Hill & Valley Gigastream, Apple's Next CEO, OpenAI's Non-Profit | Scott Nolan, Sarah Guo, Casey Handmer, Shaun Maguire, Delian Asparouhov, Zach Dell, Ryan Petersen, and Chase Lochmiller

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Today is Tuesday, March 24th. We are live from the TVPN UltraDome, the temple of technology, the fortress of finance, the capital of capital. Do you know how I got here today? I drove through the Hollywood Hills, drove through the San Fernando Valley, because we're covering hill and valley today, but we're doing it from the TVPN UltraDome. We have a whole bunch of meetings. Who doesn't like it? Anyway, what do you think about this, Jordi? Ramp.com. Time is money. Save both. Easy to use corporate cards, bill pay, accounting, and a whole lot more. All in one place. Now we are covering Hill and Valley today. We are unfortunately unable to make it in person, so we will be covering it remotely, but we have an amazing setup there with a whole bunch of folks on the ground. So if you're watching this from DC, go say hello to Tyler Cosgrove live in person at Hill and Valley. Let's pull up the Linear lineup. Linear, of course, is the system for modern software development. 70% of enterprise workspaces on Linear are using agents. We have Chase Lockmiller, Ryan Peterson, Scott Nolan, Sarah Guo, Sean McGuire, Dalyan Aspruhov, Zach Dell. We have an amazing lineup and we're very excited to talk to all of them. Starting at 11:45 today. But first, we have to recap some things. There's been a whole bunch of news. Uh, first, we had the great peptide debate of 2026. Uh, Brandon Garel on our team wrote about this in the newsletter today, tbpn.com. You can go subscribe. Uh, who do you think won? I was talking to a lot of people. Very interesting because you had scheduled this. I wasn't even really aware that there was peptide debate going on. We talked to some other folks on the show about peptides and how there was a debate, and I was aware of the meme, like the Chinese peptides in Silicon Valley, all of that stuff, but I wasn't aware of like that the debate was boiling to a particular point and that there were a lot of people that were discussing it. So it was great timing. So thank you for organizing that, and thank you to our guests, Max and Martin, who took the time to come and talk to us, and I thought did a really good job of being simultaneously entertaining And also very cordial. Like they weren't actually going at each other's throats. They were scoring points. But I don't think that either of them crossed any lines. Yeah, there was some, there was some discussion over like, should we have done more fact-checking? I genuinely, I generally think that the chat is good for fact-checking or the experts. Yeah, it's kind of like your view, but I don't know.

Yeah, there was a bunch of, there's a bunch of people that made very fair points.

Yeah.

Pointing out a study here or a patent here. And I don't think we actually got, we don't think we, it would've been great if we got to a conclusion yesterday and it was like, yeah, this is all bad and it should all be banned or no, they're all good or figured it out. But that's where we started.

We started with like, yeah, everyone there agrees that GLP-1s that are owned by pharmaceutical companies are, probably not beneficial, blah, blah, blah. And then the really far out stuff that hasn't been studied, that's made in a basement is probably risky. And we actually had a good friend of the show sum it up. Creatine Cycle Atlas, of course, said the peptide debate is as follows. Against, I would be worried about unknown unknowns. Pro, while there isn't much human data, the anecdotal evidence is pretty strong. Against, anecdotes are not enough for me. Pro, fair. It is for me, against. Okay, fair. And I think that's a good point. And truthfully, you know, people can make their own decisions here. I do think interjecting with a ton of fact-checking during the debate would be disruptive. I'm not a fan of that. I sort of just like having one person, like the guest, the debater fact-check the other person because if they know the fact and, the other person who they're debating against drops something that's not factual, that's their opportunity to come in and say, "No, that's not accurate." Throw that canister, whatever Martin had. Throw it. Throw the flashbang, throw the smoke grenade. But I do, so I like leaving some of the fact-checking up to them and then just trying to recenter the debate as a moderator. But I don't know, should we do more of these? Let us know. It seemed like a lot of people had a lot of fun with it and were entertained. It's hard to come up with, you know, if we were gonna try and do this weekly, it'd be very hard to come up with like 52 really hot topics that everyone cares about and there are two opposing experts who are willing to hash it out and be entertaining on a live show. Probably not gonna happen all that much, but when the time is right, I think there's an opportunity for us to do another debate 'cause it was a lot of fun. And it wasn't our first one. We've done the slob versus steel debate between Ev Randall and Dallin Asbrook, former colleagues turned bitter rivals. And that was fun. Because it was like the most insider of insider topics around like, you know, wrapper multiples and AI companies versus hard tech. And we're gonna be talking to Deleon later today. But it was— that was really fun. That was very cordial. I think that one was less viral because there aren't that many people who are in the chair of I need you. I need you to decide how to—

It's so personal too. So it becomes hyper-political.

Hyper-political.

How dare you? Try to ban something that I benefited from. Totally, totally. I totally see that side of it, but yeah.

And there's the other side, which is there just aren't that many people that are in the seat of, how will I allocate capital between hard tech companies in the private markets and AI software companies and SaaS companies in the private markets? It's just a little bit more niche, but it was really fun, and I hope we can do more there. Someone was saying we should do an accelerationist versus decelerationist. Debate. I think Beth Jezos was proposing that. I think that would be sort of interesting. I think I could maybe sit in the middle of that and have some interesting discussions there.

Kind of like 60 miles per hour, stay under the speed limit kind of acceleration.

Yes, yes, yes. On that vector, I am an extreme accelerationist. Let's see what else Brandon Garel wrote in the newsletter today. So leading up to the debate yesterday, we had several guests on the show discuss peptides. In February, Andrew Huberman came on and predicted that RETA, essentially a more aggressive Ozempic, would become a trillion-dollar drug. That same day, we had longevity entrepreneur Bryan Johnson on the show. He encouraged people thinking about taking peptides to be cautious because we don't know what the negative effects of these drugs are. And last week, Maximus CEO Cameron Maximus, which I don't think is his real name. Is his last name Maximus? No, it's not. It's— it's— it can't. But I mean, I like to think of him as Dr. Cameron Maximus.

That is his name on X. Oh, okay.

Okay. That makes sense. He argued that there's no real reason to be taking RETA, not FDA approved, only available on the gray market, when they could be taking— when people who are, you know, in the market or, or, you know, their doctor recommends something, they could be taking tirzepatide, which essentially has the same benefits, can be bought legally, and it's FDA approved. So yesterday, Shkreli argued— Martin Shkreli argued that the current peptide craze is more psychology driven than science driven and is essentially a passing fad among Silicon Valley elites who aren't really, what is that, who aren't among Silicon Valley elites, who aren't really expert trusters. In his view, there is no rational reason to experiment with compounds like Retta when proven regulated drugs like Ozempic already exist. He thinks gray markets should be shut down entirely. And there was a big debate over how feasible is it to actually try and shut down the gray markets. Gray markets have existed in a whole bunch of other, other categories. I'm very familiar with the, the gray market for illegal flavored vaporizers because they have been the bane of the legitimate industry, the nicotine industries. It's been the bane of their existence. And so Martin argued that the FDA's rigorous approval process exists for a reason. Now, we had Max arguing the Peptide Bull case. He argued that he doesn't believe all peptides are safe and effective, but that a subset of them likely have real therapeutic value. He said that since people are already using peptides, a regulated white market would reduce harm compared to the current gray market. So lots to debate there. We'll let you make your own decisions. You can go listen to the full debate and you can see where you weigh in. Before we move on to our next story, let me tell you about Shopify. Shopify is the commerce platform that grows with your business and lets you sell in seconds online, in-store, on mobile, on social, on marketplaces, and now with agents. And let's also tell you about Vibe.co, where D2C brands, B2B startups, and AI companies advertise on streaming TV. Pick channels, target audiences, and measure sales just like on Meta. And man, not having Tyler Cosgrove in the TVP and UltraDome is— it's a death knell for our clapping during the ad read strategy. We need to get some soundboard going. We need to show these supporters, these sponsors some love because we're fighting 2 men down right now, maybe 3 men down. We're on our last leg over here in the TVP. VPN Ultra. Anyway, Apple is in a completely different situation. They have their heir apparent, John Ternus, the nice guy, potentially taking the reins. Maybe this year, maybe next year. It could happen any day now. Tim Cook doesn't want to talk about retirement, but John Ternus is emerging as his most likely successor. This is from friend of the show Mark Gurman in Bloomberg. Go subscribe. And there's an interesting, this is an interesting profile of John Ternus from March 22nd, 2026, just 2 days ago this was published, 5:00 PM Eastern. And it tells an interesting story of John Ternus. And I think Gurman does a great job of going deeper than some of the other reporting that had like one quote from an employee that left Apple a decade ago and was sort of vague. And that person doesn't have like any sort of profile. And it was very hard to read into who is John Ternus as a person. I think we're getting a clearer picture now. So thank you to Mark Gurman for this reporting. So let's read through some of this and then I want you to cosplay as John Ternus and let me know, would you do things differently? Do you agree with his management style? Because this might be the management style of all of Apple soon if he takes the reins.

We're basically recreating a live version of the Ternus simulator.

Yeah, we're getting into an armchair and we're going to be quarterbacking. We're going to be armchair quarterbacking Apple. So During an all-hands meeting at Apple in January, an employee asked about, about a spate of executive moves. The company's chief operating officer recently retired. The CFO and general counsel took smaller roles as a way to prepare for their own retirements. And in a single week in December, its heads of artificial intelligence, user interfaces, and environmental initiatives all announced their departures. While part of the exodus was related to Apple Inc.'s well-documented struggles in AI, it also reflected a logical transition at a company that turns 50 on April 1st. Wow. Apple was founded on April Fool's Day. That's amazing.

It's a great date.

Apple stock made everyone at the top of its org chart fabulously wealthy, and many are entering the stage of life that often inspires people to prioritize family, spending some time, finally spending some time with their families instead of the next generation of iPhones. In his response to the employee's question, Tim Cook, the company's 65-year-old CEO, struck an atypically reflective tone. He said, when people get to a certain age, some, he said, are going to retire, letting the word some hang out there in a way that suggested he wasn't talking about himself, drawing laughter from the audience. It's like some people, they can't hang. But look at Warren Buffett, 65 to 95, most productive era of his career.

Tim Cook generational run starts now.

I like the idea of Cook for the next 30 years. I'm still bullish Tim Cook. I mean, I love John Ternus, but I think, I think the 30-year run from Tim Cook going 65 to 95 would be particularly fun to watch.

Anyway, Cook was going to retire. Then he started experimenting with some Chinese pep.

Oh, you think that's what's going on?

He's always looked good. Now he's like, I actually got another few decades in me.

I hope so. He's like, actually, it's BPC-157 having remarkable effects on me. So he said the thing we have to do is to make sure that Apple moves on. Reaches the next level and the next level and the next level, Cook added. And he said he spends a lot of time thinking about who's in the room in 5, 10, 15 years. I'm obsessed with this. This is Tim Cook at his best. This guy can't leave. They can't leave. He's firing me up here.

I'm somebody who's been listening to Senra.

Yes, it's amazing. So Cook, who's run Apple since taking over from co-founder Steve Jobs in 2011, probably doesn't expect to be in the room himself for another 15 years.

But I do.

I'm betting on him. Well, While he's given no indication of an imminent transition, he's made it clear he wants his heir to come from within the company so he can serve as a mentor. The central candidate is John Ternus, senior vice president for hardware engineering, who oversees development of the devices that generate roughly 80% of Apple's revenue. At 50, Ternus is also younger than many of the company's other senior leaders, meaning he could be in the top job longer. Ternus has spent about half of his life at Apple. Half of his life, generational run. He cut his teeth developing computer monitors, oversaw product design for the original iPad, and eventually took over development of the Mac, getting the top hardware engineering role in 2021. He's overseen an expansion in Apple's product lineup, improving quality and focusing on functional improvements around battery life, performance, and connectivity. Earlier this month, when Apple held an event in New York to announce the MacBook Neo, a $599 laptop, it was Ternus, not Cook, who did the big reveal. A little foreshadowing there.

A little trial run.

The next day, Ternus also appeared on Good Morning America to talk up the device, the type of media appearance Cook has generally done himself. Such public signs of confidence in Ternus have been accompanied by steady expansion of his portfolio. Last year, he took control of a secretive unit developing robot robots, including a tabletop device with a screen that swirls to focus on a speaker moving around the room. The smart lamp. Is this what it is? No, it's not a smart lamp.

It's the iPad that on a swivel arm.

Yeah, the iPad that follows you around so that you can ask it questions and FaceTime with your friends from anywhere.

I think there's a rumor that it can do kickflips, but.

I'd be super into that. I mean, if it has a motor, you've seen those motor, those robots that are on the bikes and it's just a big battery pack with like a robotic arm that's attached to it. Have you seen this? Oh, this is amazing.

Apple comes out with a smart, iPad device that's just called a bicycle for the iPad. It's just a little bicycle.

No, no, no. If you have a weight up here and you have a robotic arm that can hinge down, if you pull that up really quickly, you can actually jump up. And so, there's all these crazy videos of these robot bikes like jumping up onto tables and stuff. It's very fun. So, he— Ternus has taken a bigger role in Apple's product marketing, sometimes personally editing copy for the website and even product event materials, and he has become central to the company's work to make its devices more environmentally sustainable. Ternus has also assumed oversight of the hardware and software design teams, making him a key liaison between Apple's vaunted design organization and senior management, meaning he's already one of the most influential people in the company's history. Current and former executives who've worked closely with Ternus, most of whom requested anonymity, say he has made a mark on Apple's hardware portfolio, reversing a trend of declining product quality as the company prioritized thinness and sleekness over performance. Quote, he is a very meticulous engineer and a judicious executive, says Tony Blevins, the company's chief procurement officer until 2022, who described Ternus as an outstanding and obvious choice to succeed Cook. So this is sort of the other side of the Ternus story from that random quote that went into the Wall Street Journal that I was sort of like, I don't know if this person is —like, it didn't feel like they were operating on, like, the more recent run that he's been on. Like, he's been there for 25 years. If you go back a decade, like, he could be a completely different executive. So anyway, he's a car racing enthusiast. He's a cycling enthusiast. I assume cycling means performance-enhancing drugs? Cycles? Yeah, tren. Tren? Testosterone? No. He is a bicyclist and a car racing enthusiast. Ternus is known to take his colleagues to upstate Washington for off-road rally car racing. Let's go. Excellent choice, Tim Cook. I see why you picked him.

So bullish.

His love of motorsports notwithstanding, Ternus, like Cook, is risk-averse and reluctant to, as one person close to him puts it, upset the apple cart. Good pun. As one longtime executive says, if you think Tim Cook is doing a good job, then you'll think John Ternus is doing a good job too.

That also feels like an underhanded—

It's maybe a dig. I have been a staunch defender of Tim Cook Did well on the supply chain, did well on the tariffs, did well negotiating all sorts of tough things, wound up with a great partnership with Gemini, wound up in— always looks bad as you're investigating one feature on a one-month timeline, but when you zoom out over a decade, incredible amount of value created, incredible performance, and very few weaknesses in the business from my perspective. But you can take the other side of it because I know you're frustrated by every app that they release lately. But who knows? Apps, not just the operating system itself.

Also, I mean, the new material is rough.

Like, I dropped this phone a lot and it's very scratched, whereas the old one, battle scars, the old one I think was titanium and, and really like held up well. Also the blue, this is what Gurman was saying, he was saying that Like with this new material, I think it's aluminum now. It went back to aluminum. Getting the paint to actually stick on is much harder than the titanium, which couldn't have been as rich. They never could have done that bright orange phone on the titanium. But the way they like—

You should just take sandpaper to yours and turn it into silver like mine.

Yeah, maybe like the Casey Neistat style on the Ray-Bans. You know what he does where he spray paints them white and then like scratches off the white? Oh, it's really, really cool design. He's very popular for this.

All right, let's maybe skip forward and talk about kind of the— The Vision Pro. The debate that's been raging internally about some of his recent decision-making.

Okay, before we do this, I'm gonna tell you about CrowdStrike. Your business is AI, their business is security. CrowdStrike secures AI and stops breaches. And I'm also gonna talk to you about Finn.ai, the number one AI agent for customer service. If you want AI to handle your customer support, go to Finn.ai. So despite his reputation for personable management, so he's known as a very nice manager, nice guy, he's the nice guy at Apple. Ternus has at times broken with that style in ways that raised eyebrows internally. Late in the lead-up to the release of the Vision Pro headset, my favorite Apple device ever, unironically, for instance, engineers uncovered a flaw that threatened and one of the device's marquee features, which is odd because this is not one of the marquee features for me, but it's the ability to stream ultra low—

Well, you're not the average user, Jon. You use your Mac.

I'm a power user. I'm a power user.

What? Well, no, the average user doesn't use this thing.

Yeah, yeah. I'm like 5 standard deviations above on the usage. So the ability to stream ultra low latency audio from the headset to AirPods. This apparently was a capability central to Apple's pitch of a seamless experience for immersive video and gaming. And this is the real thing.

So you just bought this, this $3,500 face computer. And $3,500 was the headline price. And they're telling you—

When I bought one, it was close to 5 grand because I upgraded the storage and there were taxes and stuff. And I think I threw in a case. And so like I was up in the high 4-something. I took it back, but—

Wait, I thought you still had one.

I got a new one. Oh, I got a new one later, later, but I took like 2 years off. I'm a fake fan, fair-weather fan. They did one good Red Bull video and I was like, I got to get back in.

Okay, I just think it's so funny that they ship this, you know, $3,000 to $5,000, yes, you know, computer for your head that's super heavy, and they're like, and you're gonna need to grab some AirPods.

Yeah, yeah, well, you're not— that's the thing, you're not, because the audio quality that comes out of the actual strap on the headset is fantastic. It sounds great.

But other people can hear it.

Kind of, like barely. Like you can turn the volume down and it's so close.

It's like the headphones are like right here. You're telling me if you turn the volume down a lot and keep it really quiet, the other people can't hear.

Pretty much, unless you are truly in like a library context. In any normal scenario, the speaker, although it is exposed, and if someone were to put their ear up next to yours, they could hear what you were listening to, it's just not loud enough for anyone to hear it. So I never really use the AirPods linked to the headphones because, or the headset, because it's just like a separate thing. It's just extra stuff to put on. Anyway, it was clearly important to Apple. Apple's always prided itself on device integration, hardware integration, and they are great at that. Like you put in the AirPods and you switch over to a YouTube video on your MacBook and it just plays right there. You switch over to your phone, you take a call, it switches right back. Like the connectivity with their Bluetooth strategy and their wireless strategy has always been fantastic, but apparently it wasn't going well with the development of the Vision Pro headset. So the ability to stream ultra-low latency audio from the headset to AirPods, this was a capability central to Apple's pitch of a seamless experience for immersive video and gaming. The problem stemmed from a missing wireless frequency in the then newest AirPods Pro. The only practical fix was to ship a revised version of the earbuds, which the company did at the end of 2023. So normally the AirPod Pros were on like AirPod Pro 1, AirPod Pro 2, AirPod Pro 3, like a normal revision cycle. But that year they had to do like a half step and it was like AirPod Pro 2.5 and all it, like they only updated this one little frequency thing in the wireless connection. And so it was sort of a weird move, probably, cost them some extra money to do. It was a mistake that was, you know, caused by a particular hardware engineer on this team. So when they launched the Apple Vision Pro in February of 2024, that meant that anyone who wanted this feature, they just paid $3,500. They had to spend another $250 on new AirPods that added the ultra-low latency support and not much else. So it wasn't like, oh, you also got translation or some AI feature or better audio quality or better noise canceling. It was like the exact same thing that you had. You just have to pay an extra $250 for this. And so this was a debacle. And the debacle reverberated through multiple teams, including hardware, software, testing, and the Vision Pro group. People involved said Ternus alienated some people on staff by focusing initially on finding out whom to blame. Who did it? In the aftermath, a senior AirPods executive was reassigned The— and I'm laughing because I— so I asked Jordi this morning, I said, okay, I gave him like the overall broad strokes of what happened, and what was your first recommendation for— shut down both product lines.

Shut down both product lines.

Just shut down both entirely.

And then I would have focused on coming out with a pair of wired headsets made of wood using horse hair for the actual connectivity. Yeah, yeah. And then no wires at all. Yeah, and then sort of like with a leather—

Certainly no plastics, no macroplastics or microplastics.

Yeah, probably creating some like tallow, like some type of like tallow to make it more comfortable.

You don't want the wood to get splinters in your ears. Splinters, like a beef tallow. So you lubricate your ear canal with beef tallow.

Just go back to basics. Introducing AirPod Caveman.

Caveman, yeah, yeah, yeah, that's what you would've done.

So that's where I would've started.

That's where you would've started, okay. But then I went to Jordi Hays and I said, okay, but like assuming that Ternus, you know, had the mandate of Apple, like you gotta ship this product, it's gotta be good, you have to continue this product line, you can't pivot to beef tallow and sandalwood AirPods, what would you do?

Yeah, I think it's like a touch grass product, so basically, you know, say, hey, we're shutting down the Vision Pro, but we're just gonna sell you a little patch of grass. So if you want to be immersed in something, you can just go to your desk and—

Maybe they could become like a tour guide, a vacation guide. So if you wanna go see a beautiful vista, you can just go see it in person. That would be more of your idea. But I was trying to get at what should Ternus have done? Should he have gone softer? Because it appears that he reassigned a senior AirPods executive.

Yeah. So this issue comes down to, from my understanding, this senior executive who is responsible for, it was the AirPods, right? He did not process that the Apple Vision Pro was coming out and they were selling against this feature. Yeah, Mr. Quack. And Apple, the thing that I think they still do really well to this day, even though, you know, almost all their other software on the iPhone is a total disaster, is connectivity between the devices and syncing them and things like that. So they still do that well. And so to come out with this and in just a blatant sort of unforced error, didn't communicate properly with the other teams creating Apple products for the AirPods, which are just designed to sync perfectly with all the other It would be like if one of the cameras was blurry or something like that.

It's like, well, the iPhone, like, yeah, it's not dominating AI crazy features yet, but like everyone counts on the iPhone for having a good set of cameras. Like they're always good. And so if you mess up something that is the basis of the strategy, that is risky. And there's been this debate over, you know, is he a nice guy or is he too hard? Ternes looks at mistakes as systemic problems that could be solved with better leadership instead of by putting the onus on the engineers, someone said who worked for him. And this person adds, Ternus is a nice guy. And I think it is the nice guy thing to just reassign someone instead of like this super cutthroat culture. It also is sort of a throwback. This is what Ben Thompson was talking about today. It's a throwback to the Steve Jobs era. Like Steve Jobs would have said, hey, I demanded this. You made a mistake, heads must roll. And that was a bit of the company culture, at least in the lore. And who knows how true that is, but this doesn't seem like it goes too far into ruthless business behavior. But that's sort of where the discussion is around Ternus. Is he pure nice guy? Does he have a harder edge? I don't know. At a certain point, the buck has to stop with someone.

And you have to have— Yeah, the fact that this executive just got reassigned, they weren't— Yeah. Effectively terminated to me shows that—

Well, it depends on what role he played.

What would Steve have done?

What if they got reassigned to assembling iPhones by hand? The first American—

you're going to make the first American iPhone. It's been done.

It won't be the first because we did it here first.

By Apple. Anyway, let's move on. So anyways, I think Ternus didn't go hard enough.

Didn't go hard enough. Yeah. Yeah. Should have gone after him personally. Should have said, you caused— $50 million damages. AirPods is a $20 billion business, and we had to give people refunds and create a new product line for this. The AirPods 2.5. You owe us $200 million and we're coming after your 401(k). No, do not do that. That is far too— that is far too aggressive. And then Ternus didn't do that. You know, he reassigned the person, put a new leader in place to make sure that mistakes don't like that, don't happen like that. This is the nature of running a big company. Company that's high stakes like Apple. And overall, this profile, it still continues to give me confidence in Ternus. And honestly, Tim Cook. Really quickly, let me tell you about the New York Stock Exchange. Want to change the world? Raise capital at the New York Stock Exchange. Friendly IPO inbound. And let me also tell you about TurboPuffer, serverless vector and full-text search built from first principles and object storage. Fast, 10x cheaper, and extremely scalable. So there is a whole bunch of other news. We're in Fast Company. We are on the COVID of the Fast Company.

It's hard to see, but that is John.

No, this is Steve Huffman, who came on our show last week. We had a very fun conversation with him. But we were featured in the world's 50 most innovative companies, the definitive guide to the future of business. We're up there with 2B, Google, Walmart, BYD. These are some big companies. Ramp got a nod and TVPN got a nod right next to Ramp. And, and they sent us a very nice letter. And we are sitting here with a nice little mural of a bunch of our guests. Who do we get? We got Brian Armstrong, Amazon CEO.

Tell me, tell me who we got beat out. We were the number 2 media company.

We were the number 2 most innovative media company. We got beat out by a CDN. Matthew Prince over at Cloudflare. Smoked us. Smoked us. Smoked us. We didn't stand a chance. Just look at the scale of Cloudflare. They distribute so much media. That's what— it's a content delivery network. They deliver content. We try and deliver content. We deliver 3 hours a day. They deliver probably billions of hours a second. I can't even imagine the scale of that business. It's everywhere. But Matthew Prince is a very innovative leader, and I completely agree with the ranking that he should be.

But we're coming for you next year.

We're coming next year, Matthew. It's on. It's on. But this is a fun, fun, fun article. We gave them some quotes. Producers at CNBC wake up in the morning to look at the public markets in order to plan the day's lineup. John Coogan and Jordi Hays, co-hosts of TBPn, a daily talk show devoted to the business of technology, wake up and look at what's trending on X. That's true. And then they gab. That's us. Quote says Hays, we cover something like 50 to 100 topics rapid fire, 55 days a week in bespoke suits. The duo riff on the news for 3 interrupted hours, accompanied by a revolving cast of venture investors, startup founders, and the occasional single-name elite like Zuck. On good days, the livestream draws more than 130,000 simultaneous viewers. Millions more watch the highlighted clips and listen to the podcast. We basically leverage the algorithms, Jordi Hays says of TBP's programming strategy. Love them or hate them, they do a really good job of sorting what people are interested in. Anyway, you can go check it out.

They did. Yeah, this was a cool moment.

That's fun.

I, uh, as, as a boy, I subscribed to the print edition of Fast Company and always looked forward to getting it in the physical mailbox at home and reading through it.

Unwell, Alex Cooper's network is 23, so how— she must be media. She must be higher than us.

What's the category though? Oh, I don't know, because if Cloudflare is a media company, Unwell might be—

it might be a CDN. Who knows? Let's see. Unwell was ranked— oh, Unwell is in the advertising and marketing category, but not media news. Cloudflare is media news, and we are second behind Cloudflare. That is interesting. I would say Unwell beat us fair and square.

All I have to say is, in the words of the Canadian Olympic team, John, silver shines just as bright.

We've been on a bit of a silver tear lately. We're the second highest ranked technology show on Spotify. Thank you to everyone who's been subscribing and leaving us 5-star reviews over there.

And yeah, thank you to Team Canada for pioneering, making it a little bit more pioneering.

Cope is a strategy, it's a marketing strategy. Walmart's in here. Databricks is in here. Adidas is in here. Of course, Ramp is in here. 50+ businesses.

Ramp is in the lemonade category.

Yes, definitely. It actually does look like the lemonade lemon category because the accompanying image has some yellow circles. But that's not ramp-related. This is, of course, related to Mackenzie Bezos, who's been donating money for funding American colleges and universities. So very, very fun. Sundar Pichai got a nice photo spread. He's done a ton of good stuff at Google. But it leads with Sundar Pichai.

Blindsided by Chad. Matic was number 3 most innovative company in Consumer Electronics.

Yeah, there's some other good, there's some other good stuff.

This is innovative too, lists inside of lists.

Oh yeah, there's lists inside of lists. Oh wait, oh, the category, category rank. Yeah, um, Unitree Robotics is at 39. I'm really disappointed that we couldn't beat Unitree, but I love that IMAX beat Unitree. American excellence right there. We're gonna do it. Uh, Diplo's Run Club is at 50. Uh, The Onion We beat The Onion. That's crazy. I love The Onion. The Onion was foundational to me. Anyway, lots of fun in the Fast Company rankings.

Yeah, thank you to the Fast Company team. Let me tell you about Consul.

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OpenAI's new nonprofit foundation announces plans to spend $1 billion this year and has appointed OpenAI co-founder Wojciech. Am I saying that correctly? Woj. Woj. Yeah. Woj and Jacob of Coefficient Giving to leadership positions. Still searching for an executive director. Mm-hmm. Sam says AI will help discover new science such as cures for diseases, which is perhaps the most important way to increase quality of life long term. AI will also present new threats to society that we have to address. No company can sufficiently mitigate these on their own. We will need a society-wide response to things like novel biothreats, a massive and fast change to the economy, extremely capable models causing complex emergent effects across society, and more. So it's great that this has gotten set up. I know you can imagine just how much has gone into this.

I would love to see them. I mean, they have a lot of money here. They're going to be donating a lot of money. I think it's going to be the best-funded nonprofit in the history of humanity. That's very exciting. I would love just a little carve-out for developing, like, consumer apps or consumer technology.

Just a little bit. Or at least foundational technology that could be spun out.

Yeah. I would like this. I mean, they've had so much success. Spinning things out, it's funded the nonprofit so effectively.

[Speaker:TREY_LOCKERBIE] Why not keep it going?

[Speaker:MIKE GREEN] Yeah, why change horses in the middle of a stream? If it ain't broke, don't fix it. I'd like to see a little bit there. Then also, some high-frequency trading probably, because you got to do something with the balance sheet. Why not get some Jane Street folks in there and start eking out fractions of a penny on every trade? Uh, in other news, what else?

Andrew Bosworth is taking over supervision of the company's efforts to become AI native. That's going to be overseeing Meta's AI for Work initiative that was previously led by another exec.

He is— he has been, he's been, uh, with, uh, trusted general. Yeah, he's been there for so long.

Yes, for work is their internal initiatives. These are I think like internal products that help the company operate more efficiently. And of course, this signals a shift, a deprioritization of the metaverse, which has been obviously in the works in different ways for quite a while. But I love Boz. I think he's a great fit to lead this internally. In other news, Ares and Apollo cap private credit fund withdrawals as exodus grows.

This is in the news every day now. We've been nibbling at the edges of this story, because it's intriguing. A lot of people aren't familiar with these names, because they're, of course, private, or they invest in private credit. It's, it's, it's, you know, increasingly more and more.

Yeah, it's a big enough story. If you have any, any personal exposure to private credit, you probably are thinking, hey, I'd like to reduce some of that exposure.

Yeah, totally. So two in the two of the biggest names in private credit, Ares Management and Apollo Global, blocked investors from getting even half of the money they wanted out of their funds, a sign of the mounting strain on the $1.8 trillion market. The 10 billion Ares Strategic Income Fund limited withdrawals to 5% of shares after clients sought to redeem 11.6%. So that's not total like run. Some of this has been framed like people are trying to withdraw 50%. It's they're trying to withdraw 11.6% and Ares limited that to 5%. There's $15.1 billion business development company Apollo Debt Solutions, which said it was imposing the same cap after requests to pull 11.2%. So very similar numbers. The redemption requests larger on a percentage basis than those earlier this month at Blackstone and BlackRock suggests that investors are growing anxious about a liquidity squeeze, squeeze in the illiquid private credit market. The world's largest alternative asset managers, which for years have fueled the private credit boom, are suddenly grappling with investors skittish about the industry's lending practices and exposure to businesses vulnerable to artificial intelligence. It was very interesting talking to the CEO of BNY yesterday where he— I asked him a pretty broad question about private credit exposure and risks, and he gave a little bit of backstory and history, which was helpful, but sort of agreed with the Jamie Dimon take that when a lot of people are talking about cockroaches and jitters, that like there's probably where there's smoke, there's fire was how I interpreted his answer. Money managers are handling the surge of negative sentiment in a variety of ways. Funds from Blue Owl Capital moved to sell assets and Blackstone injected employee cash to help meet redemption requests. For the most part, however, managers have limited redemptions and emphasized the benefits of doing so. At one point Tuesday, The latest wave of investor jitters wiped out $10 billion of market cap from the likes of Ares, Apollo, and rivals Blackstone and KKR, as shares of all four asset managers fell more than 2%. At the same time, inflows into the asset class have slowed, weakening demand, and more investors looking to cash out could constrain liquidity further for the fund, making it harder to underwrite new loans. Limiting redemptions could also increase negative sentiment. Investment in non-traded business development companies was down around 43% last month compared to prior— the year prior. Ares, for its part, emphasized that only a small portion of shareholders sought to redeem. Notably, the majority of repurchase requests were made by a limited number of family offices and smaller institutions in select geographies that represent less than 1% of our over 200— our are 20,000 shareholders. What do you think they mean by select geographies? Is that the Middle East that they're trying to gesture towards that there's more liquidity demands amongst wealthy families and family offices in the Middle East? And so that it might be more of a geopolitical issue than— I don't know. Select geographies just feels like choice language deliberately meant to point the finger or the arrow somewhere. But it's unclear. I don't know. I wonder if we will see more reporting from what the sovereign wealth funds are doing, what the family offices in the Middle East are doing, because certainly, there's new requirements and money needs to flow all over the place. The firm expects the granted redemptions to amount to roughly $524.5 million. Ares said that the fund had around $5 billion in undrawn capacity, including debt facilities, repayments from existing investors, inflows, and a performing liquid credit sleeve. Some money managers are already indicating that they're ready for the strain to continue. Apollo Debt Solutions and Ares Strategic Income Fund both said they will offer withdrawals of up to 5% of shares again next quarter. Anyway, let me tell you about Figma. Agents, meet the canvas. Your AI agents can now create and modify your Figma files with design system context. It's in beta starting today. Go check it out. And let me also tell you about Restream. One livestream, 30+ destinations. If you want to multistream, go to restream.com.

So, Dreamer—

what's going on? Is joining Meta Superintelligence Labs. Interesting. David Singleton shared, excited to announce that his founder, his co-founders, and the entire team over at Dreamer are joining Meta. The last few The last 6 months have been extraordinary. We built Dreamer, put the beta in the world just a month ago, and saw magic come to life for real people. Since then, thousands of people have used Dreamer to build personal intelligent software with our sidekick in the world's newest and most popular programming language, English. Huh. They're building and sharing agents to manage email, calendar, to-dos, create learning tools for their kids, learn new languages, plan trips with friends, become better cooks, help them with work, achieve their health goals, or simply to creatively express themselves. All sorts of surprising and unique personal needs. These agents are as— are— these are agents as unique as the people building them because they're built exactly the way people— that each person wants them to meet. We've captured some of our favorites, and let's go over here. They, uh, yeah, people are building timers, receipt scanners, citation assistant. This is great if you're using ChatGPT to do your homework. You can build a little citation assistant. People are building personal financial apps. Yeah, I'm curious, again, with any of these sort of Meta MSL acquisitions, you have to wonder, is this, can you read into their product direction at all with the acquisition? Is Meta gonna be making, is Meta AI gonna have the ability to make your own? Agents, that is still to be seen. But congratulations to the whole team.

Well, let me tell you about ElevenLabs. Build intelligent real-time conversational agents. Reimagine human technology with ElevenLabs. And let me also tell you about Vanta. Automate compliance and security. Vanta is the leading AI trust management platform. So I mean, I think with that, most people will think like Aquahire, rolled into Manus, rolled into other products. At the same time, there is an interesting like diffusion in consumer question that's going on that I think might be a little bit underrated. Just the question of what will adoption and retention be like when you don't have to buy a MacBook or a Mac Mini, when you don't have to, you know, get any API keys at all versus it's an app on your phone versus it's in ChatGPT or it's in, It's in Instagram, like bundling those things together actually. You know, we never really got firm data on how much LLaMA's been used.

I really wanna build an agent that can predict which videos, funny videos that I would send to you and just have it do it automatically. 'Cause I think our feeds are pretty synced up right now where sometimes John will send me a video and then 10 minutes later, I'll send him the same video, but I didn't see that he sent it. Then you look at it. And then we can both log off forever.

Well, let's, let's go over to the Chinese billionaire who says America's EV market is doomed without him. Not a problem because we're building V8s and V12s over here, baby. We're going back. We're going back. No, this is serious.

Bad timing for all of this. Bad timing for our desires to get the Tesla Roadster to have a naturally aspirated V12. Well, maybe good timing. Given energy prices.

Yeah, yeah, it's rough. Uh, anyway, Robin, uh, Zhang of CATL, CATL, can't build a factory in America, but Tesla, Ford, and GM rely on its technology. Uh, inside a headquarters that's shaped like a giant battery cell. You got to give it to them. That's design. That's what we need to be seeing from our tech leaders. Apple did it well with the UFO campus. I want to see more headquarters that are shaped like the product that you sell. The billionaire who runs the world's largest battery company is confident that Americans will come calling eventually. We will return to the story later in the show, but without further ado, we have Chase Lockmiller from Crusoe in the Newsroom waiting room. Chase, how are you doing? What's up, guys? How you doing? We're doing great. Great. How is Helen Valley? You're the first person that we've talked to today. Give us a read on what's happening on the ground. How are How are you feeling?

You know, it's great. It's great to see the partnership between Silicon Valley and D.C. really come together. Yeah, I think, you know, you can really feel that there's a very pro-business climate here and a lot of members of the administration here, you know, helping support a lot of the big technology initiatives across, you know, everything from AI to defense tech to, you know, other, other software businesses. I think it's very, very good vibes here.

How are you introducing Crusoe when you meet new folks in Capitol Hill today? I mean, there's the company has been— how many years have you been working on this? It's been a number of years, correct?

Yes. So the company is about 8 years old.

Okay. Overnight success. There we go. Overnight success. But yes.

How are you introducing it? Up and to the right. Yeah. It's, you know, I really introduced the company as a vertically integrated infrastructure business where, you know, we focus on both the physical aspects of bringing AI infrastructure to life— land, power, data center development, design, engineering, and deployment of large-scale clusters of GPUs— as well as the software aspects of bringing AI to life between orchestration of workloads across large clusters of GPUs, management of GPU clusters with, you know, self-healing aspects like our AutoClusters product. Interesting. And our managed Kubernetes product, as well as, you know, serving applications as they scale with things like our Crusoe managed inference product where we can serve and host models and really, you know, give, give the key AI applications the tokens they need.

We've been talking a ton about bottlenecks. You outlined sort of like like 4 or 5 pieces of the stack there. It feels like the managed Kubernetes cluster, the software development, maybe that's getting easier with AI. It feels like we have a lot of land. Is our energy and chips the real bottleneck for you these days? Like what are you seeing in terms of things that need to be unblocked, things that the industry needs to be focused on going forward over the next few years?

I think data center capacity writ large is absolutely a bottleneck. And, you know, with that broad bottleneck, I think there's a lot of underlying aspects, whether it's, you know, the power to energize the data center, the people to build the facility. So like labor is a major constraint. And, you know, I think there's incredible blue-collar workforce opportunities across the entire ecosystem to help build this infrastructure of intelligence for the future. You know, I think chips, chips are not a bottleneck today necessarily, but energized chips are. So, again, it comes back to this power and data centers really being the critical bottlenecks.

Is there something that equates to a 10x engineer in electricians? Is there a 10x electrician? And are there recruiters that can help you find those people or is it a whole new game?

So, there are definitely like, you know, like anything, there's like dispersion amongst performance for, you know, folks like electricians. But I would say the impact of it is different than, you know, in engineering. Like, you know, with a 10x engineer, you know, sometimes it's like that's the difference between actually being able to build a product and not being able to build a product. Sure. You know, I think with a, you know, the call it a 2x engineer or 2x electrician or something like that. Yeah. You know, it's the difference between like this thing taking, you know, 40 hours and it taking 30 hours or something like that. Sure, sure. So it's less of a, you know, game-changing aspect versus like it just may take more time.

Do you have thoughts on what we as a society anything as a tech industry, as a country, can do to reskill, upskill towards this like higher-end blue-collar work? Do there need to be new training programs? Do more taxpayer funds need to flow into retraining programs? Like, I've seen some policy proposals kicked around. They all seem exciting, but is there anything that sticks out to you as particularly beneficial over the next few years?

Absolutely. This is something that, you know, I'm personally spending quite a bit of time on is like, how do we, you know, reskill the labor force to, you know, prepare them for this, you know, incredible opportunity that's, you know, underway in sort of the big AI data center buildout. I think, you know, look, there's existing trade school programs and there are, a lot of them are older. They're, you know, sort of, of these very legacy training programs. And it's great, and we need people to go through them, but I think there are certainly incredible opportunities to innovate across that trade school training program. I think like, you know, looking at a model like Alpha School and what they were able to do in terms of accelerating personalized education journeys and development journeys to, you know, have really high-performing students in sort of, the core K through 12 metrics. I think applying that same sense of AI-driven teaching, assisted teaching and curriculums, I think can be a huge unlock to get the folks we need here. And as well as I think we're exploring ways to have, and naturally I think a lot of trades sort of work this way, but we're exploring ways to basically have we have, you know, apprenticeship programs where there's a lot of on-the-job training and, you know, there's huge projects that these folks can be a part of and really learn by doing. And, you know, I think there's ways we can sort of guarantee jobs, you know, when they graduate and, you know, things like what Lambda School did for coding. I think, you know, there's an opportunity similar here in the blue-collar trades. And then the final piece is like, I think in the K-12 education programs, we've got gotten away from a lot of the, you know, working with your hands programs, like things like auto shop and wood shop and, you know, where people are building things with their hands and being taught that in, you know—

I would love to take data center shop class. Data center shop class. Yeah. That's great. Unironically, that would be —like, the higher class.

Yeah, I— sorry, Jordi, you have a question?

Yeah, I want to— so with the conflict in the Middle East impacting energy markets, capital markets, what are you paying most attention to? What are you— what is Crusoe doing to kind of mitigate any of that impact? Obviously, it's, you know, very unknown how long it'll last right now, but I'm sure it's, you know, extremely top of mind.

Yeah, this has actually been pretty amazing because You know, while oil markets have reacted quite a bit and you've seen oil prices go up and gasoline prices as a result going up quite a bit, natural gas really hasn't. And that's largely because of the energy independence that's been achieved here in the United States through investments from the energy innovators and private sector, as well as support from the Trump administration to to be a more energy-independent nation. And so what you saw in the natural gas market was that there was initially a big spike up in, in the price of gas, uh, natural gas, and then it came right back down to basically where it was, uh, before the conflict started. And, um, you know, I think that speaks volumes to, um, you know, the investments the administration's made and the private sector's made in terms of creating that energy independence for America and it's insulated folks like us from massive price fluctuations in one of the key operating expenses for these data centers, which is the cost of power.

Interesting. Talk to us about the ratepayer protection pledge. Yeah, Jordi Hays.

Before we go any further, I'm just curious, like, you know, with so much of global production and supply being taken offline, how long How long can you realistically expect prices in the US to stay stable? Is there some dynamic?

Well, I mean, that's my point is like natural gas is inherently more regionally price driven. Like it's more affected by regional supply demand aspects. Like the global price market really is only impacted if you're entirely reliant on LNG. Markets like Japan are more LNG-driven, but domestically here in the US, the main spot market people are focused on is Henry Hub. And Henry Hub is really driven—

And that's because we're producing a lot of natural gas and we're consuming that natural gas, which is different than the oil markets where we might be fracking, but then we are dependent. We're not necessarily refining it and consuming it locally. Do I have that correct?

There's a couple of different dynamics there. The US is a net exporter of natural gas via LNG, but the difference between gas and oil is that with gas, the, the, the LNG process where you're actually liquefying the gas, that is a huge expense. So, so, so it basically upticks sort of the overall cost of that gas versus oil. You don't have that same challenge, right? So So if oil, if there's a shortage, even if we produce all the oil we need here in the United States to serve American consumers, we're more impacted by the global market. Because we could basically export that oil and it's not a huge cost uplift. If the price is so much higher to sell oil in Europe or whatever, you just put it on a barge and send it across the ocean.

Right.

Okay. But with natural gas, you have to liquefy it. That's a big cost increase. And so it kind of evens out and normalizes.

Exactly. So we're, you know, because of the amount of production of natural gas and the natural gas resources we have here in the United States, we've been pretty insulated against some of these, you know, conflict-driven commodity price action.

Okay. Last question. We'll let you get back to Hill and Valley Conference. Ratepayer Protection Program. This feels like what Crusoe was built to to do and your experience has been generating power on site, going back to flared natural gas. But walk me through how you've processed the actual rollout of that pledge, how feasible it is, how realistic is it for all the different market participants to adhere to it? Because it is just a pledge. It doesn't feel like it's a law, not yet at least. But how have you interpreting it and how optimistic are you that it will have the intended effects?

Look, I think it's a wonderful trend. You know, I think the technology industry as a whole, the last thing we want to do is drive up the cost of power for grandma, right? That's like not at all, you know, the intent of the technology industry and sort of the investments that are being made by AI. So I think We have some of the most well-capitalized businesses in the history of business that are, you know, making huge investments in the future of infrastructure. And they're willing to make those investments across the data centers, the chips, as well as the power. And to me, this is a generational opportunity for society at large to basically upgrade, you know, generation infrastructure, upgrade transmission infrastructure, upgrade the grid to be able to support far more capacity than we have in the past. And, you know, the ratepayer protection pledge basically, I think, helps create a platform for companies to be investing in the energy to power these AI, you know, these AI factories. And, you know, this has been sort of the Crusoe philosophy all along. I think the trend is going to be, you know, a new term that I've, I've been using is, is this term called across the meter. And people maybe heard behind-the-meter power, where you have like power gen on-site behind the meter. The notion of across-the-meter is that you have both a generation resource that can be a gas power plant, it could be a wind farm, it could be a solar farm, it could be a battery, a large cluster of batteries. You have a load, which is a data center. And then you have a point of interconnection. And, you know, the load can basically consume all of the power that's generated on-site that it needs. Any shortfalls can be pulled in and be firmed up by the grid interconnection. And then any excess power that you have from, you know, the on-site generation can actually be supplied back to the grid. And so you get this like bidirectional aspect of the grid interconnection point, and that's really why it's called called across the meter. But, you know, this— why this is beneficial is, you know, the investment in AI data centers ultimately leads to energy abundance because you actually have all this onsite generation where you're not using a lot of it some portion of the time. And that excess energy can be supplied to the grid and actually drive down the cost for local ratepayers. So that's kind of the, you know, the future and the vision that we're really building towards.

Yeah, I'm extremely excited I'm really excited about it and it feels like just the perfect thing at the right time where a lot of Americans are asking for an answer and this is like the first step in the right direction.

Yeah, if that can be done at scale, the people are like, hey, I actually like these AI videos after all. They're driving my costs down. They're driving my rates down.

Well, thank you so much for taking the time to join us. Have a fantastic remainder of your day. Of Hill and Valley, and we'll see you soon. Our best, everyone.

Thanks, guys. Talk to you soon.

Goodbye. Let me tell you about Graphite.dev. Code review for the age of AI. Graphite helps teams on GitHub ship higher quality software faster. And let me tell you about Lambda. Lambda is the superintelligence cloud building AI supercomputers for training inference that scale from one GPU to hundreds of thousands.

Sabrina Halper says easy tell at Hill Hill and valley. Briefcase equals hill. Backpack equals valley.

What is the third option? What is the third option? What's the and? Remova. Briefcase. Not briefcase, the full luggage. Did you bring your full luggage with you? How do you stand out? Backpacker, backpack.

What about trunks? We gotta bring trunks back.

Yes, yes. Have a porter with you that brings your trunk. 4 porters. 4 porters. Is it like Louis Vuitton that's known for doing those huge trunks? Is that it? Yeah. Yeah, we got to do that. Anyway, our next guest is Ryan Peterson from Flexport. He is now in the Restream waiting room, so we'll bring him in the TV panel. Ryan, how are you doing?

Oh, look at this setup, you guys.

You look like, you look like president material. You look presidential. This is—

that's my president. This is my president. Ryan, great to see you. How are you doing?

What's new? I'm great, man. I'm back in my— people don't know this is my hometown. I'm in Washington, D.C.

I didn't know this was your hometown.

Yeah, I'm son of a government economist.

Really? No way. There you go.

Born to be president, forced to handle global logistics for fast-growing companies.

Okay, well, I mean, the first question that everyone's gotta be asking you is like, how is the geopolitical geopolitical conflict affecting your business? Because a lot of the Flexport stuff that happens, I imagine, is across the Pacific, across the Atlantic. You're not moving crude oil, but is it affecting you? What are the knock-on effects? Have you been processing the last couple of weeks? How are you holding up?

We gotta print out a picture of Ryan with his face on Ben Affleck, you know, smoking a cigarette, 'cause I feel like you should just put that up in the office. Yeah. 'Cause like every day—

There are so many— You're just completely insulated from the, yeah, I run a SaaS company, you know, the 99% dollar retention. And you're like, whatever happened on the front page of the journal affects me. But take me through it.

Like a month and a half ago, I told my comms team, hey guys, I'm gonna take a break. I'm not gonna do any press. I just wanna lock in on AI. I'm just gonna, we gotta apply AI everywhere in our business. And then since then we had the tariffs get overturned and now this straight of horror moves. And I've been asked to do press more than in my whole life ever combined almost. So, but, you know, in fact, the impact on container shipping, which is what a lot of people think about, Flexport is relatively negligible. Like prices have gone up. But other than that, it's not that big of a deal. Yeah. The reality is that Strait of Hormuz and the Persian Gulf is a cul-de-sac. It's, it's really not that important that you go in there. Yeah. For container shipping, it's a huge deal for oil.

And of course, for a lot of the price increases due to fuel costs.

Fuel costs in like, yeah, people get away with what they can get away with in logistics. So some of it is just like, ah, you know, disruption, let's raise the prices. Sure, sure. The bigger impact is actually on the air freight market.

Okay.

Where the Middle Eastern airlines own up about 18% of the world's air cargo capacity. So air freight prices have doubled and we're a big air freight provider too. So that's been, helping companies navigate that, especially air freight. Asia to Europe is really disrupted. A lot of that would fly into Dubai and kind of get, planes would refuel, get transshipped and then sent on. So we've actually built like a new product that's actually working really well where we ship cargo via ocean from Asia to Los Angeles and then hotshot truck it to LAX and put it on a plane to Europe. Which is very strange, but apparently it saves people a lot of money and time versus air freight direct from Asia to Europe.

What does hotshot mean?

What does that mean? It's like, it's this concept where the truck doesn't make any stops, it just goes directly to the head. Yeah, I love it. I might've made that up.

I know, it sounds good to me. Talk to me about the tool you rolled out for tariff refunds. Was that the first AI-driven product? I mean, I imagine you've been using AI for years, but was that the first like, wow, okay, we built something something new very, very quickly moment for you? Because I know you've been doing a ton of investing in AI tooling, AI software development, all sorts of things. And I want to get into that, but I want to focus on the tariff tool first.

Yeah, well, we've been— there's a ton of stuff that we do with AI that's a lot. Not all of it's customer-facing. In fact, most of it's just automating work and making ourselves cheaper and more reliable. But the tariff refund calculator, not that much AI actually. What we do is basically just take your data from the government. Whenever you import something, you have a record that sits with Customs and Border Protection in their technology system. It's not a very easy to use system. They'll give it to you as a CSV file. Okay. And then we clean that CSV file and give you a report showing exactly what you're owed. Yeah, it's not, not rocket science, but we were able to build it really quickly thanks to AI. So we launched it. I think it came out— the tariffs were announced on a Friday. We launched this on Monday. Yeah, I was very proud of it because Monday we worked all weekend and Monday morning at 7 AM I was on CNBC talking about our new tariff refund calculator, which is pretty showing you, I think, how, how the modern world's going to look like. You got to be really good at responding to what's happening in your industry. And if you're that fast, you know, I don't, I think it'll be a long time before our competitors have anything comparable.

Are Flexport employees allowed to buy tariff refunds?

Buying refunds? I don't know if our employees are, but Flexport is. We will be announcing— no, I can't announce it right now, but we will be announcing a program to buy people's refunds at a discount and get them cash up front.

Yeah, makes sense for businesses.

So that's something we're actively working on. It's a very hot market right now, but I think we can build something unique because, you know, the secondary market for this is very interesting. It was trading in the 20 cents on the dollar range, 20, 25 cents. $0.30. And then the day of the Supreme Court ruling, it went to $0.50. And it's now in the $0.60s. And even I'm hearing some trades in the $0.70s, if your claim is big enough, $0.70 on the dollar to get paid now. But I think those guys are going to run into real problems because they have an agency problem. Like if you're a hedge fund, you bought someone's tariff refund, how hard is that guy going to work to actually go get the refund when push comes to shove?

Like, you're going to have to file paper paperwork and the government's going to reject your claim and then you got to file more paperwork and like, oh, because the original, the original owner of the refund still has to go fight for it, but they've already sold it, so they're not incentivized to go work. Whereas like, it's not like you're trading the claim and the hedge fund can go fight it because I feel like the hedge fund would be very motivated to get that claim, but they don't have the right to it.

Ultimately, it's the original importer that still has to go get the claim. And so we're going to be there to hold your, you know, hold the hand and make sure we actually go get the claim. So I think we're uniquely positioned to help with that, and that's very exciting, kind of create the trust across the market. So we, yeah, we're going to try to launch that soon. We're very active right now.

Yeah, talk to me about the other AI initiatives.

Yeah, what's your approach? Is it to just tell every employee, like, buy as many AI products as you can, do a million demos, or is it more like focus on And I'm joking there, it sounds like something you would never do, but is it more like, you have like an internal team that's focused on shipping experiments? I'm assuming it's like more internal tools because Flexport customers don't necessarily care what's happening. They just want things fast and cheap and all that stuff.

Yeah, we're in this incredible moment. I declared code red a few months ago around AI because what we saw, we built this product in for AI audit of customs back in October. We launched it in October of last year. And basically what we did, we, we're a customs brokerage, we help people clear customs. So we built this and as a customs brokerage, you have to review, we review about 5% of all customs entries a second time with a human. Human compliance team. And our error rate in that process was 1.8%. It doesn't mean that we violated customs law 1.8% of the time, just to clarify. It's like, oh, maybe we didn't declare like some free trade agreement that it was eligible for, etc. Those types of things. So, we then built, in October, we launched this AI auditor. So, now we audit 100% of entries before we transmit it to the government. And then by November, we started to see the data, we were, we had gotten our error rate down to 0.2%. So it's 10 times better than the humans are. That's crazy. And, and that was like the first giant wake-up call. You're like, oh my God. And there's a lot of work at our company that looks like a customs audit. Totally. Like you're like wrangling unstructured data, doing some reasoning about it. Yeah. Submitting, you know, moving documents around, submitting data to a government or some other party. So we, by early Q1, as you're like, oh, it's code red. Like if we, we have to be the company that takes AI and automates and does everything with AI and with AI agents in particular in this industry. And we have massive, like if we don't do it, it's only 'cause of ourselves. Like, and I'm paranoid as hell. Sure. That we're like a boomer company that can't get this done because we've got a lot of people who don't have these skillset. And like a lot of people who are set in their ways. And so I've been just like leading from the front on this. We've got small teams that are kind of really cracked and building stuff and some proofs of concept where the AI agents can do most of the work that people do. And we're telling everyone at Flexport like, yo, this is the new reality of our business. And if you're not ahead of the curve in learning how to use AI, how to automate work, how to make yourself more productive, yeah, like let's just live in reality. Everybody's job's at risk, including mine. Like if I'm not in able to lead from the front and be the best at this, then someone else needs to be the CEO of the company.

Yeah, someone's gonna build the AI native, truly AI native Flexport. Like, you're not gonna let it be anyone else.

One tip, I think it'll be us, but there's a chance that it's not, right? And like, we're either become the most valuable company in the world or we're worthless. Like, it's crazy, crazy fork in the road.

One tip, instead of doing, we're trying to push companies, instead of doing code reds, like Matt will do code red, to do a Baja blast. Baja Blast instead. So you declare a Baja Blast when you get back to the office. Yes. Yeah. Okay. It's just like a little bit more like positive messaging.

No, no, no, it's okay. It's okay to declare code red, but every code red must be followed by a Baja Blast. Okay. All right. Once, once, once things are really turning and you're Baja blasting, just rolling out feature after AI feature, you need to declare Baja Blast. And then everyone doubles down and goes even harder on everything, but at least you know that you're operating from an even stronger position of strength. That's the goal.

Yes. Yeah. Well, I'll tell you, I talked to— I've been texting. One of my jobs here is to go learn who's the best at this. And it's very interesting. There's not that much consensus. I've texted probably 10 CEOs of really well-established tech companies that they don't look like Flexport, but they have profiles where there's some manual labor and processes and compliance and things like this. There's a lot of figuring it out right now and everybody's, the CEOs are super energized and leading from the front, but I don't think there's yet a playbook. Yeah. For how to come in and use AI agents to do most of the work in a company. But the companies that figure this out are gonna run through the economy. Yeah. And I think you're gonna be able to, whole industries are gonna get replaced by companies that are good at this or the company, you know, the companies that are in the industry have to be the ones doing that. Yeah. And that's our, if we don't do it, I really think I think the company could be worthless in a few years. So it's kind of a crazy moment.

Yeah, you have so many assets and so much experience. Like it's definitely your fight to win. Are you updating your timelines on more self-driving technology or automation in the physical world based on what you're seeing with Waymo, what you're seeing with GPT models getting better and better? Like it just feels like— Flexport, mass driver. Yeah. Are you going to the moon?

We are, we are, we are very close to that space. So we operate 5 sort of mega fulfillment centers, 5 million square feet of fulfillment, and they're pretty manual operations right now. I've been a robot skeptic in, in these buildings. Yeah. I just think our, our teams in those buildings are not that expensive and they're pretty good. Like if you someone, I mean, I'm on the record saying like if you have a humanoid robot that has the IQ of, you know, AGI of a human and it's only $20 an hour, like I'll hire 1,000 of them in each of my buildings. And that's kind of what we've done. That said, it sort of messes with the aura of the company. If we've got AI everything, automated everything, and then the cargo shows up at this building full of workers picking items manually and putting away. So there's some argument there. We've been spending a lot of time with our robotics fulfillment center. Limits companies that, that have pitches here. It seems kind of commodified. The ROI pitches are pretty good, like maybe too good. I'm a skeptic. Um, and, uh, we'll probably be investing in that space and we'll be a consumer of it. I don't really see us building the robots. Like, I think they're very competitive market. So that makes sense.

Yeah. And, and, and they're— I, I think the main, the main question is like, how do these— how do the robot companies actually price this? Are they going to basically lease them to you on some type of hourly rate based on runtime? Are they going to ask you to actually shell out like $20,000, $30,000, $40,000, $50,000 for these things? And then you have to be running the math on, okay, how quickly is this thing going to depreciate? How often am I going to have to replace all these motors? And I'm sure there's a bunch of different things they can do to mitigate that.

Yeah, and I don't think humanoid form factor is right for fulfillment centers anyways. Like, I mean, you just want wheels. Yeah. Um, and conveyor belts.

That's like the number one demo that at least one humanoid company is doing. I, I don't get it.

I mean, you just— you don't need the feet. Like, you just need the arm, uh, and, and then wheels to bring you the items. You can ride a hoverboard around.

You just add the wheels and, you know, we have hoverboard technology. $200 Temu hoverboard. Gets it done. No, I don't know. I don't know that. That's a good idea. I mean, there are a lot of companies working on a lot of different things.

What happened to the hoverboards, by the way? They just disappeared.

They just disappeared.

Yeah. They came and went so fast.

You can't commute on them. If there's any cracks in the street, you'll fall on your face. It's not good. You need to be in a warehouse, basically. That's the only use case.

Were you a hoverboard user, John? We had a hoverboard.

You know Rob? He actually injured himself on one. It was very dramatic at the office. Yes. And then we had a ban issued on hoverboards in the office because we were like, I don't know if you have a photo of Rob on it.

Uh, I think I do.

Text me that, please. Yes. Yeah, yeah, yeah. It was, it was a dramatic day where we were like, I don't know if our insurance policy covers this. It's mostly for like carpal tunnel because a lot of people on keyboards, not many people on hoverboards. And so we'll stick to the keyboards. Anyway, have a fantastic time in DC, Ryan. We hope to see you soon. Great to see you. Have a great day.

Thank you.

Thanks for having me on. Goodbye. See you guys there.

Cheers. Let me tell you about Cognition.

They're the makers of Devin the AI Software Engineer. Crush your backlog with your personal AI engineering team. And let me also tell you about Okta. Okta helps you assign every AI agent a trusted identity so you get the power of AI without the risk. Secure every agent, secure any agent with Okta. Our next guest is Scott Nolan from General Matter. We will be bringing him in just a minute. We can, we can go to back to the timeline. There was a very important post in here that we need to see. A gentleman got a tattoo that we need to investigate. So someone got a 2020, 2026 Louis Vuitton glasses as a tattoo. And we will have to pull up this video because a lot of people have been wondering what tattoo they should get as a first tattoo. And Louis Vuitton glasses looks great. It looks great.

And, and I like the monogram across the forehead too.

This is ad space that has previously been unconsidered. No one's, no one's thought about this before. NASA Administrator Jared Isaacman announced a $20 billion plan to build a permanent US base on the moon. We can move on from the Louis Vuitton glasses. Thank you. Over the next 7 years, NASA is canceling plans to deploy a space station into lunar orbit. The quote here is, NASA is committed to achieving the near impossible once again, to return to the moon before the end of President Trump's term, build a moon base, establish an enduring presence, and do the other things that needed to ensure American leadership in space.

Did he say anything about making it a state?

Not yet, but there are some very interesting— the moon is sort of up for grabs. Whoever lands there first, whenever you land, you kick up a bunch of dust and you, by default in international space law, you sort of claim like a number of miles in every direction that you land. And so you can sort of just rush the moon This is a controversial strategy, but—

Let's see how it plays out for us.

No, no, no. So you can't claim the moon according to space law, which is sort of flimsy, but you can't just say, "Hey, we planted the flag, it's ours," or "We claim this part of the territory." But when you land, by law, I can't just land on top of you because I would just destroy whatever you built. And so if I build up a bunch of stuff, then I sort of claimed it. And so there is, It is a new space race afoot, but we will come back to that story later because we have Scott Nolan, who is the founder and CEO of General Matter, in the Restream waiting room. Let's bring Scott in. How are you doing? Good. Thank you guys. Thanks for having me. Good to see you. Thanks so much for taking the time on such a busy day. How is Hill and Valley going for you?

Hill and Valley's great. It seems like everyone's here. Yeah. But great discussions, great event.

What is the latest and greatest from General Matter? Can you get us up to speed on the development every time we talk to you. Yeah, is the job finished? Yeah, is the job finished?

Not yet, no. It's going to be a few years. As you guys know, we're aiming for production before the end of the decade, but it's— there's a lot of work to do to get there. The latest updates on our end are really January, we got a contract from the DOE. Yeah, I think we've talked about that in the past. Yeah, that's $900 million to build our capacity in Paducah, Kentucky. A week ago, we actually announced a new deal with Ex-Im Bank working together towards financing of offtake in Japan and Korea. So that's going to be our first international markets and moving into there to provide enriched uranium to our allies so that they don't have to depend on our adversaries. So step one is really domestic. Yeah, domestic production for needs at home and then overseas is the latest update.

Double-click on offtake for me. What exactly is happening there? Because I know the uranium's in the ground, it gets refined eventually, eventually it goes into a nuclear reactor. There's a couple other steps. That's right.

Yeah, we should, we should give the overall update again. But the big picture is every reactor that you hear about needs fuel. Yeah. And it needs one of two types of fuel, either low-enriched or higher-enriched fuel to 20%. And to make fuel, there's 5 steps. It's really get it out of the ground, mine it, turn it into a gas, enrich it, turn it back into a solid, and then make your fuel pellets. That middle step is one that the US used to be the world leader in, 86%. Of worldwide production and now we're less than 1%. Yeah. And so we're trying to bring that back, doing that in Kentucky, all clean sheet engineering, just focus on cost and scalability. So yeah, that's what we're doing. The offtake is we have this, you know, capacity to sell and to enrich. And so utilities work with us, you know, they'll contract with us for us to take their uranium and enrich it to the level they need it to operate in a reactor.

Okay. Yeah, that makes sense. Makes sense. Has the— is the— do you think the ratepayer protection plan or pledge is going to be overall bullish for the nuclear industry? I imagine that as we move towards more behind-the-meter energy production, people should be thinking more nuclear. But is that how the energy market will play out in the United States?

I think it's a genius move. So we were talking about concepts like this even before that announcement, where, you know, you started to see things where communities were starting to get concerned about data centers coming to their community, driving up electricity prices. It's just, you know, when you're, when you're talking about how much you're spending in a data center, why not just produce a little bit more energy production capacity? Maybe produce 110% of what you need. And internally we nicknamed that bring your own energy. And so I think that's the way that you get data centers to be not just neutral, but highly beneficial to the communities that they're in. Reduce rates for everybody. I don't think it's just ratepayer protection. I think it's ratepayer reduction. Yeah. And so that's, that's how we should be getting to cheaper rates on the meter and how we should actually build out the grid again. So I think that's, I think that's a genius move. Yeah, I think nuclear should be a big part of it. I think enrichment is going to be the bottleneck to scaling that, which is why we're trying to solve enrichment.

Yeah. Whenever we talk about actually turning uranium into energy, at some point we start talking about new reactor development. We talked to Doug Bernauer from Radian. We've talked to Isaiah from Volar. Is there another side of the industry that's waking up? Are we going to be seeing new things from the Westinghouses of the world, these old companies that maybe the capital markets are more receptive to, regulation's more receptive to, and they have a unique product that can actually generate generate hundreds of megawatts. I don't know how big the biggest Westinghouse reactors are, but the criticism has not been for a while, they don't work. It's been, they take too long or they're too expensive and maybe something's changing in the economy or the energy landscape.

Yeah, I think it's just like people talk about all the above energy. I think it's all the above reactors. So micro reactors might work in one area, but a gigawatt scale like AP1000 reactor is going to work on the grid. And so that side of things has always been about how do we do faster, more affordable, more predictable construction projects for those gigawatt-scale reactors. Everything else is about how do we build it in a, in a factory, how do we bring down the cost of the reactor. And so the world really is divided into those two camps, either, hey, we're committed to it being a construction project, let's do that better. And there's companies working on doing that better. And then there's all the reactor companies that are focused on either like 1 megawatt, 10 to 50 megawatt, a little bit bigger than that for data centers and tiling those together. So I think there's a lot of people with different strategies and all of them can make sense for their own end markets.

Curious to ask, how, how does, how do nuclear energy providers respond to, you know, geopolitical events the last week where you have, you know, fluctuating energy prices in, you know, the LNG markets, is it possible for nuclear energy providers in, let's say, China to see rising fuel costs and react to that? Or are we more talking about they just are kind of steadily providing energy as they always do, and it's less of a sector that can be kind of responsive to changes in global fuel costs?

Yeah, I think it's just on the nuclear side, it's just extremely stable, more of the same. I think you see the volatility in the fossil fuel markets and I think that if anything, is probably viewed as a tailwind for nuclear where, hey, nuclear is going to be here. You know, you buy a reactor, you buy a few years of inventory on fuel which can easily be stored, and you're going to have predictability in your energy costs. And for the really big reactors, the fuel cost is not a major cost. So they haven't worried about it as, as much. Really on their mind is how do we get diversification and a stable supply base. On the advanced reactor side, the fuel cost is actually pretty meaningful. And so that's why we're really focused on not just scalability and reliability, but also cost structure. So nuclear in general, I think the more volatility there is in the fossil fuel space, the more, the more obvious it is that that needs to be a huge part of the grid. And then the fuel for nuclear is, you know, we're trying to produce more of it and we're bringing the cost down so that the advanced reactor companies can at some point potentially beat fossil fuels on a cost basis, not just on a safety and low carbon basis.

And remind me about the actual mining landscape. Is this a scenario where America has enough deposits of uranium and other fuels that we're purely limited on refining capabilities and manufacturing manufacturing capabilities, or is there a world where America actually runs out of the raw material?

No, it's really a limit on enrichment and on reactor construction. Yeah. Now, on mining, the US doesn't have as good of deposits as like a Canada or Australia. They're not as ore rich. And so the price at which it makes sense to do mining in the US is a little bit higher than it would be in Canada. But it's still coming online at these prices, and we see producers in Texas, Wyoming coming back online, bringing new mines online. You have still mining operations happening in Utah, Colorado.

So— And even those foreign countries are very geopolitically stable. They're allied countries. So a lot less, a lot less long-term risk. Yeah, I mean, you've been working in the nuclear industry for a number of years now since before Christopher Nolan's Oppenheimer movie. Was that movie educational? Did it make your job easier Or was the net effect like more fear around nuclear in your opinion? I thought maybe neither.

Okay. When I went to go see the movie, I was hoping it would be more inspirational in some way, get into more of the tech, like make it about the work that they had to do. You know, it was more of a character study in a lot of ways. Totally. And so, yeah, I think it was neutral. I think the one scene from the movie that was relevant was, if you remember when he's in the, I think in a classroom or in a, in a setting like that and he's filling up the bowls with marbles. The big bowl of marbles was uranium enrichment. So we explain that to people, we're making the marbles that go into the nuclear reactors, not into anything they were doing.

There's not nearly enough marbles in the bowl right now. Well, thank you so much for taking the time to come chat with us. Great to be here. Have a fantastic rest of your time at Hill Valley and we'll see you soon.

Say hi to everyone. Will do. Have a good one.

Goodbye. Let me tell you about Gusto, the unified platform for payroll benefits and HR built to evolve with small and medium-sized businesses. And let me also tell you about Gemini 3.1 Pro. Gemini 3.1 Pro is here with a more capable baseline. It's great for, for super complex tasks like visualizing difficult concepts, synthesizing data into a single view, or bringing creative projects to life. I have a challenge. Hit me. I want to teach you. An Australian accent, and here's how you do it. You say this out loud exactly as it's written. Have you been to Spice Lightly? Have you been to Spice Lightly? Have you been to Spice Lightly? Really, you have to read this because the words are—

Say it out loud wherever you are in the world, even if you're in the middle of your office.

Spice, like cinnamon, lightly, as opposed to heavy. Heavily, but when you say, have you beaned a spice lightly, you sound Australian. It's crazy. It's like an optical illusion for your mouth, I suppose. Anyway, there's plenty of other news while we wait for our next guest to join. Let's see what else is in the news. Have you heard, speaking of manufacturing, can we pull up this video of this gentleman who runs a bowling alley? Because this is a fascinating case study in the American manufacturing and industrial capabilities. Listen to this video, Jordi. I don't think you've seen this.

So people always ask me, what's the hardest part about owning a bowling alley? It's not managing a bar or even the crazy property taxes on a building this big. It's actually these machines. These are Brunswick's A-2 pinsetters, built in the 1960s. Running here for almost a decade.

Each machine has over 2,000 moving parts.

That's the problem.

Just like anything their age, they start breaking down. And while the parts are becoming hard to find, the mechanics who grew up servicing these are even more rare, which is why we're starting to see more and more houses convert to the string pin machine. But just like any industry, innovation is often met with skepticism.

Bowlers claim that potentially switch to pin setters that have strings, which bowlers don't like because the pins don't flop.

The crash and the free fall. Well, we don't know how to make bowling machines.

We actually don't know how to make bowling machines in this country anymore.

Only American dynamism category I care about.

Yeah, move over General Motors. Sorry, General Motors. Yeah, sorry, Andorral.

This needs to come.

We need the Bowling Company of America.

The bowling That's the only category that I approve of a new name in that style.

Yes, but it does tell a very interesting story because these niche long-tail manufacturing organizations are very difficult. There's a whole bunch of bespoke gears and switches and electronics and all sorts of different machinery in there that's been difficult to make, and it is a victim of the deindustrialization process that we've been suffering through for the last few decades. But it was just interesting to see it in like a viral Instagram reel. Anyway, we have our next guest, Sarah Guo, from Conviction in the Restream waiting room. Let's bring her into the TV.

Sarah, how are you doing?

Welcome to the show. I'm great. Hey, guys.

What's happening? Great to see you.

We like the hot drop. We like bringing you in just as soon as you're ready. But great to see you. How is your Hill How's the Silicon Valley going?

It's amazing. It is much bigger than it's been in prior years, but there's a lot of work to be done and it's a great group that they've assembled here.

Does everyone understand what a Neo Lab is? You introduced me to this during our Christmas episode, which you had a fantastic costume for. And I— very serious person.

Yeah, it was.

It was all very serious people. But have Neo Labs as a concept gone mainstream?

Mainstream? I don't know that everybody here is paying attention to that, but the impact of the capability improvement from the labs and lots of other projects in AI, I think Washington's definitely paying attention to.

And what specifically? I mean, we talked, we talked previously about some of the admin's work on, you know, protecting children and giving parental controls. But what are the other areas There's obviously the Ratepayer Protection Pledge. There's energy. What are the other conversations around AI that might actually ripple down to a startup founder or somebody in your portfolio, a Neo Lab, or even a lab lead?

Yeah, I think one of the areas that has come to the fore is this idea that we need to have more industrial capacity in the United States to manufacture things from munitions to chips, to parts for robots. And there are a lot of different strategic areas that America has given up in the supply chain. In order to reclaim them, the path has to be automation, right? Just in terms of cost of labor. And I think there's growing recognition amongst both people in the administration, policymakers, and private companies working on it now.

And, and what's at the top of the list? There's, there's like zoning requirements, funding bills, tax incentives. There's so many levers that you can pull. What are people actually excited about?

I think one of the basic blockers is just going to be the ability to build faster in areas that have been traditionally very regulated. Right. And that could be generation, it could be transmission lines. A lot of it is about energy, actually, but some of it is about labor. Let's talk about that, too. Brad from OpenAI was pointing out that the bottlenecks to increased that limit AI capacity in the United States are very real world and then they're very human, like they're labor-centric. And the ability to unblock, let's say, more electricians or more folks standing up data centers or more power generation is actually something that Washington has control over. So it's something we have to work on together.

Yeah, we were talking to Chase at Crusoe about this, about retraining, upskilling. And I'm wondering, like, do you Do you see that as a venture-scale opportunity? If somebody came to you and said, I wanna build a trade school or even just like—

I wanna create 55 electricians, 55 plumbers.

Yeah, or even just like a website, an app, an online course. I don't even know the shape of it, but is that a startup opportunity or is that something that like we firmly need to put back on the university system or the trade schools or the government?

Personally, I want somebody, who built a startup previously to go work for the government and do something like that. Bring, bring the speed.

But yeah, what do you think?

I think it's all of the above. It's funny you should ask. I didn't plant this question, but I am in fact a longtime investor in a company called Uplimit that focuses on reskilling. And they work with lots of great companies on, you know, skilling for the AI age as well, mostly digital today versus the trades. But I think it has to be a combination of these things. And I would say even if, you know, reskilling is something we should clearly do and make a huge investment in from both the public and the private front, it's not enough. Right. When you think about the demand in this race where, as Congressman Molinar said, like, we cannot lose because it represents the future productivity of the global economy, it is happening very quickly. Right. So even if we invest in upskilling, which we should do with startups, with universities, with government programs, we need like 10 times as many electricians like next year, right? If you just think about the capacity growth. And so there are some very real limits to how quickly you can move capability in humans. And so I think we need to go to automation for parts of this.

Yeah. Jordi?

I'm curious if you've picked up on the Hills' information diet. Like, how are they learning? Hopefully they're watching every episode of No Priors, indulging in Duarte Cash. But like, where are they getting their information? Obviously, the event is a great place to kind of like understand these different categories. But like, what narratives are they tracking? And who is most influential from a, you know, kind of an information standpoint?

Well, I hope they're listening to TVPN all the time as well. That would educate them. I think one of the things that is always going to be clear is in order to take the risks that you need to in terms of understanding what's going on at the frontier and listening to different audiences that are not always going to be super open, nor is every every one of the narratives of these different audiences supported by the mainstream media, you have to, you have to go talk to the people. Right. And the thing I'm really encouraged by with something like Hill and Valley or with, you know, I've been in D.C. like 4 times over the last 6 months, which is more than 5 years ago by, by far. But you also see like the ecosystem coming here. And increasingly, like we see lawmakers come visit us when they're out in the Bay Area. And so I think a lot of it is in person. I think that's, like, excellent in terms of education.

How have you been talking to founders in your portfolio, founders you work with, about the SaaSpocalypse, if they're in tech, but they're not a Foundation Lab, a Neo Lab, and they're watching maybe the dinosaur that they were eating one bite at a time, the multiples compressing over there, are there and they're sort of thinking about their strategy, how AI native they should be, what they should do, how they should think about their valuation. What type of conversations are you having around that?

One of the most useful things a board member can do is provide market context and like actually sound the, the red alarm. Yeah. Once in a very long while. Right. And so here, I think I think if, if people have not dramatically changed their strategy according to what's happening in the market with capability in software over the last 3 or 4 years, like the vast majority of them have a real problem. Right. And so I would like to think that the companies that we work with know that. And a lot of really smart founders and CEOs know that. But one thing, one distinction I would draw is I don't think the entire world collapses into a few labs. Labs. I think the world is very big in terms of capabilities we need to go work on, from getting people their, you know, prescription drug treatments with companies like Leighton Health to work in AI or contact center like Harvey and Sierra. It is not clear at all to me that that is in the pathway of the research work that the labs want to do and the largely productivity and code-focused products that they've built.

Yeah. How are you thinking about actual deployment of just like AI tools being AI first if you're sort of a growth stage CEO 5 or 10 years into your journey and you need to go and sort of revitalize the company? Are you more of a fan of, you know, crack, like labs type team that has the authority to go and rewrite systems systems and vibe code tools and try and speed things up within the legacy structure? Or is it sort of the all-hands meeting and everyone is going to be onboarding to AI tools today or they're going to get left behind? How do you think about the trade-off between like verticalization versus horizontalization within a company?

I think that there's, there's probably like 3 elements you need to really upgrade a software company for the AI age, right? You need, first of all, the urgency, which is if you were an enterprise software company in the last decade before ChatGPT and you had kind of won your market in terms of adoption or lighthouse customers at, let's say, scale of more than $100 million run rate, you felt pretty good about the future, right? Barring, you know, limits to your market size at some point. I think everything has become much more challenging for workflow software companies. And here's where the willingness to back founder-led companies— and you see founders coming back in and getting much more active about this at companies, at technology companies of all scales, where they have the moral authority and the urgency to say we need to operate very differently. And so I think that's element one. The second point is what you said, which is given it's a general capability, then you actually want every, you know, great companies. It's not just like one function is good. Often you are good at everything, right? You are good at finance and G&A. You are great at sales and marketing. You are great at building product. You, you know, are really smart about strategy. And so I think in every dimension of the company, maybe it's the all-hands you describe, or maybe it's hackathon, maybe it's just like allowing for internal use and experimentation and making that a norm, but you need everybody to do it. And then I think the third piece is like, how do you create this compounding motion where you get a huge part of the business to be driven by AI such that you can make these very really, you know, kind of innovator's dilemma decisions about where to invest and even how to price. Maybe that is a labs team. Maybe it is a founder with the moral authority to do things like Simon at Notion. Maybe it's an acquisition if the company is lacking the talent. But I do think you have to do all three of these things at once.

ChatGPT moment in robotics. Has it already happened with Waymo? Do you think it'll look like something else? Do you think it can look like that given that physical AI can't just be instantly distributed through every iPhone? How are you thinking about, you know, physical AI broadly and kind of breakout moments?

I think we will see it in the next 2 years. And Waymo and robo-taxis, these are absolutely the first version of autonomous robotics that most people will see. But it's a very large physical world. And we still don't— like, I think the— in certain communities, in, you know, big cities in California, the acceptance speed— consumers are hilarious, right? They're like, I am never going to get in a Waymo. That looks unsafe. And then the second time they sit in the Waymo, they're like, oh, you know, maybe I'll like pull up my phone because I'm already distracted. Right. And third time you get in the Waymo, you're like, I can't believe that this thing doesn't go any faster. And like, it went to this point in my driveway instead of right here. Yeah. And so I, I, I do think we're gonna have that transition very quickly. And it's a huge opportunity the way, you know, the 900 million users, uh, are now on ChatGPT or more. Yeah. Um, but, uh, but I think we're gonna see it in different functional areas, right? And so I sit on the board of a company called Sunday Robotics. You guys have met Tony. Love them. Uh, and, and so whether it's them or somebody else, we're gonna when we're going to see them. I think we're going to see robots in the home, and that'll be the first time people believe that it's possible for a robot to do general work as well as in manufacturing. We really need it in manufacturing and industrial environments as well.

That's very cool. Another sort of prediction. Ben Thompson called ChatGPT or OpenAI like the accidental consumer company. They were very much like a Neo in the sense they were just doing research and then they just wound up with a consumer product. Do you think it's possible that we'll see another consumer application emerge from a Neo lab or something like it?

Yeah, I'm betting on it. And so I absolutely think that the chat box, the ability to interact with information in sort of mostly a single turn, but sometimes a conversational way, where, yes, you increasingly add data sources actively is one way that consumers will interact with AI, obviously. But the open claw was this very interesting phenomenon where the— it was a combination of a bunch of really interesting ideas that still hasn't penetrated the mainstream consumer, even though tech audiences are very excited about it. And so I think that's just, you know, one signal of what's to come when you have long-running agents with some idea of memory and persistence and ability to do things on people's behalf. And we'll see other examples of this as well.

Yeah. Jordi, anything else? Yeah, this was great. Enjoy the rest of Hill and Valley. Thank you so much for taking the time to come. Great to see you. Great to see you.

Good to see you guys. Have a good one.

Goodbye. Let me tell you about Sentry. Sentry shows developers what's broken and helps them fix it fast. That's why 150,000 organizations use it to keep their apps working. And let me also tell you about Labelbox. RL environments, voice robotics, evals, and expert human data. Labelbox is the data factory behind the world's leading AI teams.

Let's pull up this video from Elliot Potter. Okay, says, we've raised $27 million for this moment. Starting today, your agents get an iPhone and can talk like a friend. Texting is a universal interface. Millions of people text every day. But until now, developers have been restricted from building on the most powerful channel to ever exist. Link is a single API for iMessage, RCS, SMS, voice, and even FaceTime and Find My. Nothing for users to download, nothing new to learn. We're already powering InterAction, Pika, Lindy, Zoho, Dimension, Tomo, and others we can't name yet to bring this new ecosystem to life. Join them and start building for free in our sandbox linked below. Let's pull up the video with some sound, please. Can we start over?

Apps are the past. We're already in territory where— that's us, President Mark. That's the Germinator.

And that's the move forward.

First, we learned to click.

You've got mail. All right, so here we are, one of the first YouTube videos at the zoo. We learned to tap.

A revolutionary product: the Mac, the iPod, and now the iPhone.

For decades, we've been trapped speaking the language of the machine until today. The era of the user interface is over, and finally, technology is a conversation. Link is a single unified API for building conversational experiences. We give you direct access to iMessage, RCS, SMS, and voice. I'm very interested in how long this will work, how happy Apple is about this. This feels like something Apple wants control control over. They love their— the walls around their garden. Uh, and a lot of companies that have done this have kind of gone up against the folks in Cupertino and got cooked. They got cooked sometimes. I don't know. Uh, of course, I mean, there is a way that, that they do a deal with Apple, and Apple loves it. Uh, there's been some— there's been some back and forth on the timeline because potentially this post was, uh, was paid to be promoted. And we were not paid, by the way, to react to that. But Shiel Monat, friend of the show, received a DM asking if he would comment or quote tweet. Nikita Beer chimed in and said, are any comments on this post real? Because he is fighting a fight against sort of astroturfed content where startup launch videos will go to a number of people. This is like an old playbook. You send something to your friends, say, hey, I launched today, like, would love you to show me some love. And that's fine, I think, according to X's terms and conditions. But I believe that you cannot pay someone to comment, engage, retweet, or like your post without disclosing that. And so Nikita has been very quick to roll out And that's just the law. That is the law that you can't pay someone to like your post, I imagine.

I don't know. Oh, I was talking about just in general, if somebody pays you to promote something. Yes, yes. The person promoting it has to disclose it.

Yeah, I know that from FTC rules, like I can't tell you like, oh, Applovin, like, do you know, maybe they're a sponsor, maybe they're not. Profitable advertising made easy with Axon.ai. Get access to over 1 billion daily active users and grow your business. Like, I have to tell you that TVPN is powered by AppLovin, sponsored by AppLovin. We put AppLovin all over our gong. AppLovin's on the ticker. You know what's going on here. It's a promoted post. It's a sponsored integration. They're an advertising partner of ours. We love them. But we can't just secretly be doing that. And there's been a lot of that on X and there's been a lot of fear around what that would mean for the X ecosystem if every time you saw a viral post, We were like, "Yeah, this was amplified artificially without disclosure." And so Nikita Beer rolled out the paid post tag. I'm still a little vague about it because like, if I do mention Ramp in an essay and I post about it, but they didn't pay me to include them and I'm picking them off the shelf, but I picked them 'cause they sponsor the show, like, do I need to disclose the whole thing as a paid promotion or can I not mention Ramp data without that?

[Speaker] But if you're mentioning someone in an essay— No. Is not. Yeah.

Or like if I talk about Rampage, or most— Rampage commercials. Yeah. So it's all a little bit iffy. I mean, hopefully people see our disclosures and know that, you know, we have a number of advertising partners and we're very transparent about this. But there certainly is a push to be even more transparent, which I think is good.

John, we have some breaking news. What is the breaking news? From the New York Post. What's this? Squirrels are vaping e-cigarettes after mistaking fruity aromas for food. And let's, let's pull this up. We need to, clearly.

This is so important. You have a video? There is.

How'd you even find this? Just pull up this picture. Here we go. This squirrel was caught.

This is hard-hitting reporting. This is a story you need to know about.

Oh, this is so sad. Very sad. This is devastating.

Yeah, we got to keep these off the streets. Did you know that the way that illegal vapor products, like probably those that are pictured in that image of the squirrel vaping, the way that the illicit market is measured is actually through trash surveys? So companies and regulatory bodies will pay surveyors to go out, pick up bags bags of trash in, let's say, Manhattan, and dig through them and say out of how many legal products did they find and then how many illegal products did they find, because the people who buy illicit, you know, not FDA-approved vapor products might use them— they throw them away at the same rate as a legal product. No one's like, oh, I bought this at a corner store. It doesn't have FDA approval. Approval, so I better squirrel it away, no pun intended. I need to, I'll just throw it away like any other product. And so they will survey through the trash and figure out that, wait, for every Juul that we saw, we saw 3 puff bars, which are not approved, or something like that. And then they will know the ratio. Anyway, without further ado, we have Sean McGuire. Nope, Casey Hammer. Oh, Casey Hammer's here. Surprise guest. Oh, fantastic, surprise guest. Sorry, Casey, great to see you.

How you doing?

I'm very well, definitely not Sean Maguire though.

Sean Maguire's coming on in about 10 minutes. Thank you so much for joining. This is such a treat. This is even a surprise to me. Anyway, for those who don't know, reintroduce yourself for everyone.

Hi, my name's Casey and I'm the founder and CEO of Terraform Industries. Longtime fan of the show.

Longtime fan of you. Thank you for the tour of your amazing castle. Of our all-time favorite guests. I don't wanna dox your location, but Casey has like the coolest office I've ever seen. It's amazing. How is progress going? Or have you outgrown that facility? How many, like what are you building and how many of them have you built?

We are bursting at the seams, which is a lot of fun. Yeah, yeah. And we've got machinery through all the parking lots. You should come and visit again sometime. I would love to. Bring the camera. We'll do a candid walkthrough. That'd be amazing. Yeah, it's a lot of progress. It's really exciting actually getting to, stand up our own in-house manufacturing machinery. Yeah, really like having to decide, do we spend half a million dollars on buying this machine from somewhere or just get an intern or two to like build one and learn how to do it from scratch? And almost always it's better just to like let the American engineer like kind of learn how to do it. And then we own that information forever. It's super cool.

Yeah, yeah, yeah. We were watching a video of a man who owns a bowling alley and was lamenting the fact that his machines are from the '60s and he can't figure out to fix them and the parts aren't available anymore. But I think with a little elbow grease, he'll be able to keep those working for another 50 years. Remind us the actual product rollout strategy, the thesis and the actual value prop of your company.

Yeah. So TerraForm Industries makes synthetic fuel from sunlight and air. So we're making methane and natural gas. And we're also making methanol now, which is a precursor to liquid hydrocarbons. So these are all in the news recently. And it turns out that historically, if you didn't have any underground, you had to depend on getting them from somewhere else and really hope that the US Navy stood between there and here to make sure that the fuel got there safely. Yeah. So for my fellow Australians still at home in Australia, kind of staring at a, you know, monitoring the situation type website with about 30 days of fuel left for the whole country. Yeah. And that's not the case. You can actually, with modern technology, you can synthesize as much synthetic fuel as you could possibly want using nothing but sunlight and air. And that's what we're working on.

And so obviously there's like a pretty sizable R&D effort because this capacity does not exist at scale in America yet. Where are you in the research and development cycle versus deployment cycle versus testing, scaling? How are you thinking about the next few years of the business?

Yeah, that's a great question. So technology has actually been around in one form or another for more than a century, but the real challenge is innovating on cost because, you know, America's frackers got really good at making oil and gas quite cheap, which is great for all of us. But if we want to participate in that market, we've got to match them on price. Yeah. As far as participation goes, we've been hard at work for more than 4 years now in R&D and we've really basically managed to We've solved all the major technical problems. We're right now in the process of building and integrating full-scale system on our test site in Burbank. And actually, this is breaking news here on TVPN as far as the wider world is concerned. We've broken ground on a test site in the desert as well. So we'll be—

That's great news.

Yeah, so what they tell you about permitting in California is mostly true, but you can prevail and get through, which we've been able to do with the help of our friends and partners over at Kern County Permitting, which is super helpful of them. Really appreciate it. It's very, very exciting. It's— we get to go out in the desert and kind of do the vision quest and actually build this thing and have real honest-to-God synthetic methane and methanol in our hands from sunlight. Not, you know, kind of the whole process end to end.

It's a really exciting thing. It's amazing.

Yeah, I wanted— in a perfect world, world, you could clone yourself and have one version of you just posting about energy and energy markets, and then the other version of you building your business. But since we have you here, how, you know, give us an update on current kind of LNG shortages globally, how you think the market will kind of react and evolve to so much supply coming offline. You mentioned Australia, but is everything priced in yet? Is it not priced in? What are you watching?

It's really hard to say.

Australia is actually a net LNG exporter, but for the liquid products there, they're obviously importers. And Australia, like New Zealand and California and a lot of the rest of the world, has really neglected the necessity of having onshore refining capability. So you're able to take in a wide variety of different crude products from a wide variety of different exporters and then process that into usable fuels to keep your economy working. And it's been very hard to justify maintaining those capabilities with the the environmental problems they cause and overwhelming cost in some cases, when, you know, you can just buy it from Singapore or somewhere and just hope that, you know, your term in office is not the term in office when the wheels come off. And we're kind of seeing, you know, this foundation has become more shaky in recent years. It's very frustrating to me because I'm someone who understands the sheer necessity of energy sovereignty for, you know, well-being of people, particularly in the developed parts of the world and the Western world. Oil, where, you know, every man, woman, child consumes an average of about 11 gallons— sorry, 11 barrels of oil per person per year. It's really important. And unfortunately, this has happened so suddenly, it's very difficult to adapt that quickly. You'll probably hear the newspapers and TV and so on saying, oh, it's going to take years and years and years to rebuild this refinery capacity. I don't believe that's actually true. I think if you wanted to do it as quickly as possible, you could actually do it in months, not years. We know this because the Nazis The Nazis were able to kind of build coal to fuel refinery processes, you know, in the midst of horrific bombardment in the Second World War, which is almost 80 years ago. So it is possible to do, but it requires a kind of different focus, different approach to, you know, permitting and construction that is really kind of a muscle that the West has largely lost in the last few years. They're really going to have to find it again, I think.

Interesting. I love that tour of your office. I was in your office, there was something interesting about your company culture. You had something pinned to the wall or a pole. Can you talk a little bit about the company culture?

You might have to be more specific. We do have a sign on the wall that says, "We do this not because it's easy, but because we thought it was easy." Didn't you have like $100 bills taped?

Oh yeah, yeah, yeah.

Explain that. Yeah, okay. So I mean, from the perspective of a business owner and operator, We have basically fixed costs and then we have variable costs. And the fixed costs are things like payroll and rent and all the rest. And then the variable costs are when my engineers spend a lot of money buying a machine, which I actually like because at the end of the day, we're trying to maximize output per input. And the fixed costs buy you zero output. They're just all costs. And so I have this ability to kind of increase people's salary on a kind of biweekly basis. Much the same way that the Nucor, the American steel company, does by agreeing to a series of milestones in advance. And then, and then if we hit them, which we do about a third of the time, everyone gets a, you know, basically the person who gets to hand out the fake money to everyone. We write on it what it was for. And then the cash lands in your account and you go and spend it and feel good about yourself. But then the money you stick up by your computer and it reminds you that, you know, even though we're kind of in this interminable grind to try and make this technology work, and, you know, sometimes you have weeks and even months of like really banging your head against the wall. In the past, you were able to succeed kind of doing almost impossible things on impossible timelines and budgets, and you can do it again and you will do it again. And it's really important to kind of internalize that, you know, you just gotta keep on grinding away until you solve the problem mentality.

Yeah, I love it. It's such a great like visual representation of progress. Well, congratulations on the progress. I would love to come by and see the latest and greatest greatest at the HQ and have a great rest of your Silicon Valley on the new site. We'll talk to you soon. Yeah, see you soon. Have a good one. Goodbye. Let me tell you about MongoDB. What's the only thing faster than the AI market? Your business on MongoDB. Don't just build AI, own the data platform that, that powers it. We have some news out of Cupertino. We've been, we've been deep diving Apple today. Apple shipped ads in Apple Maps. Maps.

Let's, uh, let's hit the gong first. There we go.

Congratulations. Uh, I'm sure people love it. I'm sure people— I'm sure no one's upset about this. Uh, no. Uh, uh, this is from Mark Gurman, of course, the Gurmanator. Uh, Apple is launching ads in Apple Maps in search this summer in major advertising expansion. It'll be announced as early as this month they have been pushing this. Siri ads would go really hard.

Unfortunately, I can't help you about that, with that, but I can tell you about MyPillow. It's just ads. It just can't do anything except, uh, it'll take a shot at it and serve you that.

I think we have, uh, we have Sean McGuire in the Restream waiting room. Uh, let's bring him in if he's ready to go. Let's bring in Sean McGuire. Sean, how are you doing?

What's up, team? How we doing?

What's going on? Fantastic. Great to see you.

You look great. I believe we— the first time we met in person was 2 years ago at Hill and Valley, right?

I think that's correct. This is the only location where I'll look as dapper as you gentlemen.

Yes, I put on a tie just for you.

Oh, yeah. It's a good day.

Just for me. How is Hill and Valley this year? What's changed? What are the focal topics? What are you focused on? It's bigger. Bigger.

Bigger and better. Okay. Jacob, Delian, Christian deserve a lot of credit. They built something that definitely exceeded my wildest expectations for them. I'm proud of them. They crushed it. And I got to say, you just had Casey Handmer on. Yeah. Casey is a galaxy brain. Yeah. We did our PhD together.

You guys were at Caltech together, right?

Not, not just at Caltech. I mean, his now wife was my housemate for a couple of years. So anyways, he's a smart dude. He taught me a lot. Yeah, uh, it's also a little eccentric. He loves doing night hikes, like literally when full moon. So he used to go hike up, hike up mountains with him.

It's on purpose. I buy that.

Makes sense. He's like, there's actually no rules that say you can't hike at night.

Yeah, yeah, that was, uh, it was a good indoctrination for me and thinking out of the box.

Yeah, wait, aren't you a surfer?

No, you're not a surfer? I grew up in a town where everyone surfs, but I was a computer nerd. Yeah. So yes, I can surf. Okay. But like, I can probably surf better than you guys. But I— whoa, shots fired. But I'm horrible compared to— now we have to surf off.

Now we have to surf.

We have to surf. I cannot surf.

So I think a lot of—

but I think Jordi's very serious.

But, uh, Nightshade's also like 6'5" and, uh, is coming out today.

6, 8. 6, 8.

Let's, let's keep it straight. But who's counting?

Uh, okay, I want to get into, I want to get into Mass Drivers and, uh, Elon. We, we watched his presentation on Saturday. I'm sure you did as well. Uh, walk us through how you processed it. You came out with an essay that you said you edited for the first time. Okay, um, so yeah, walk us through your reaction and then how you've been been processing the general response.

Yeah, well, on the editing essay, which is obviously not the point, I started my UC college admissions essays that had an electronic deadline 2 hours before they were due and single-shot shipped it. My mom was standing over my shoulder losing her mind. We talked about it yesterday. It was pretty funny. That's amazing. Look, mass drive on the moon. I know it sounds crazy, but I think it's kind of the inevitable evolution or the inevitable next step. It's not the final state, but it's the next step. And if you have, like, if you have Starship and if you have Optimus with those two things, like if you have a lot of those things, I think build, that's basically having humans, you know, digital, like synthetic humans you could put anywhere. The Moon is a place. There's a lot of raw materials there. And so if you can build a fab on Earth and the supply chain, you can build it on the Moon with Optimus. And so, I mean, look, I think we're about to have both Starship and Optimus. So I think the mass drive on the Moon is kind of inevitable just due to economics. And I think it— I saw your amazing question, John, around when it will happen. I can't tell you. I would guess not within 15 years, but I think it will happen within 25.

Yeah, yeah, that's sort of where I got. And I think it's almost uncharacteristic in Silicon Valley for founders to actually think in decades and propose anything more than 10 years out.

Yeah, everyone's like, think in decades, think in decades. But no one actually says, this is what I'm gonna do in 20 years. No, not like that. No, not like that.

Yeah, no, no, no, it's true. Ambitious.

Yeah. And I think— I don't know. I came away from it being like, being like, yeah, it is crazy. Yeah, it is decades away. But what better North Star to have than something that is actually life's work level mission that can go on? That's not just the same thing. That's not just the next iteration of what you've already built and you've done successfully. It's something completely net new that will take a He has an incredible force of will, and so I don't know. It is interesting to me, like, how much can that philosophy scale to other founders? Like, I imagine that if a Series B founder came into your office and said, "Okay, I'm laying out this, like, 40-year timeline," you might be like, "Okay, like, let's focus on just keeping the company alive for the next 2 years." But maybe we need more of that, I don't know. How do you think about it in terms of, like, just the founder psyche, where we are in this, like, in this weird moment of AI doing everything, who knows what the next few years will look like? How do you think about this scaling to just the founders that you work with broadly?

As you guys know, I jump around a lot. So just going back to the mass driver, I'll just say one thing that I think people don't understand about it that I was trying to make this point, I didn't make it very clearly. I think the single hardest thing we're about to have done, which is Starship and Optimus. Yeah. I think that what you actually build on the moon is not very hard. Like the mass driver itself is not very hard. Building fabs and the entire supply chain to do that is a lot of work, but we've done it on Earth. And so it's like, I think that we're about to having all the raw ingredients put together and then it's just gonna take a lot of time and effort to do it. But I think people are probably overestimating how much how much future difficulty is required and underestimating how much past difficulty we've already kind of surpassed. Yeah. So anyway, sorry, I just had to make that point. Yeah. In terms of where we are, I wrote a hardware manifesto about 3 and a half years ago that I sent internally at Sequoia. And I sent it probably to like 100 people in Silicon Valley, you know, around then, but I never posted it publicly because I felt like there was there was too much alpha in it.

And kind of, it was kind of like a personal thing.

You know, it's like trying to make money for my firm and my friends.

Sure.

Anyways, the core argument I made was a few things, but like, I was trying to argue that in the case of Sequoia, 50-year-old firm at the time, now 54 years old, for the first 25 years of the firm, we made almost all of our money in hardware. Hardware. For the last 25 years, we made almost all of our money in software. I was trying to argue that I think the next 25 years we're going to make our money in hardware again. Like something like AI is unbelievable. One of the biggest revolutions ever. Like literally in this essay, I said that I think a lot of the money in AI will be made at the hardware layer. And as we, as we enter kind of a world where for digital intelligence as abundance before physical intelligence. Like my personal forecast is I think the abundance of digital intelligence is about 10 years ahead of physical intelligence, not in terms of like the state of the art of what it can do, but in terms of the full rollout, like the, you know, the total deployment, or as Dario would say, the diffusion rate. Sure. And so I think there's like this 10-year moment where hardware's not commodified at all and software kind of will be. And a couple of the other points I made, one is that if you just think logically, every software revolution is preceded by a hardware revolution. Like to have the iOS, you know, App Store that enabled Uber and DoorDash and all these great companies, you needed to have the iPhone. The iPhone took 20 years of, you know, you needed Qualcomm, you needed Broadcom, you needed, you know, fiber layouts, you needed 4G, you needed, you know, CPUs getting smaller and, you know, battery, touchscreen, you need battery density getting better, etc. This is true for any software revolution. Literally by definition is preceded by a hardware revolution. And this AI revolution, We're seeing what it can do from the software layer, but it's still limited by hardware. I think that's like at least 10 more years. And then when you go beyond that, like, I think we're kind of next point is I think we're entering like a phase transition where the hardware we were doing for a long time was kind of all following Moore's Law. Like it was all like the branching out of this decision in the mid-1950s to go all in on the silicon supply chain, and that has created magic. There's still a couple orders of magnitude of juice to squeeze, but we hit fundamental physics limits, Dennard scaling, things like that, that I think this tech tree is kind of branching into humanoid robots, into silicon photonics, into orbital data centers, all these new hardware areas where there's going to be 20-plus years of progress we get to make. And there's going to be, you know, just incredible businesses built on the back of this. And a lot of dumpster fires.

Yeah. Are you seeing hardware companies pivot into AI? We've talked to Blake Scholl at Boom about moving into, I think, natural gas turbine production. And I'm wondering about some of your other space investments that might say, hey, maybe we want to get into the data data center boom in space. Like where else are you seeing energy reallocate towards other products into being more aligned with the AI boom?

You know, I like pushing people's buttons and, you know, I remember the good old days when crypto and AI were friends. And I'll just remind you guys that a lot of these, you know, incredibly groundbreaking AI data center companies like Crusoe. I know you had Chase on this on the show earlier today. Yeah. You know, or CoolWeaver. There's like both of those were Bitcoin miners in the early days. Yep. And pivoted into AI. But I actually view this differently. I think that like AI and crypto have a shared history. And I'm not going to— I've articulated that online before. I'm not going to go into that whole thing. But I think that, yeah, we will see anyone that was an energy company is becoming an AI company. But I think that's naturally, I think that's natural. I think that it's not like a hard pivot. I would frame it the other way, that AI is becoming an energy industry. I think that in Silicon Valley, like it's almost this Copernican principle where people used to believe that the world revolved around the sun. Or sorry, revolved around the Earth and then, you know, realized that it revolves around the Sun, at least our solar system. I think that there's a Silicon Valley parallel where people think that all of technology, all of industry revolves around Silicon Valley, but it's actually kind of the opposite. Silicon Valley is Earth and there's these much bigger forces, you know, and bodies, which includes energy and, you know, chemicals industry, these giant supply chains, semiconductor industry, which has been around for a very long time. It was pretty advanced, and people in Silicon Valley forgot about it, even though, you know, we played a big role in building it.

Producing mirrors for the lithography machines, that's something that is— you're never going to see talked about in Silicon Valley until now.

Yeah, or making chemicals, you know, to make ultra-pure, you know, wafers And anyways, I just, I don't like the language of other industries pivoting into AI. I actually think it's the opposite. I think it's like Silicon Valley is waking up from its toddlerhood and realizing that there were these giant industries that we underestimated and they're actually really freaking good at what they do. And we can all benefit by working together. And so I just It's a different twist on how you even ask the question, but yes, there are many industries merging together and hardware is coming back just to the root of every, the way you think about every business in the Valley.

Last question for me, prediction around a ChatGPT-esque moment for robotics. Do you think we're on a 2-year timeline, 1 year, 5 year? Where do you sit?

So I actually think we're going to see this moment in video, like in AI video, before we see it in robotics. My forecast, like I may be wrong, it's just me forecasting. I think that within the next 12 months, we're going to see the ChatGPT moment for AI video. I think that right now we're almost in like the GPT-3 era where for the people that are really insiders, they know that the models have gotten really good, but they haven't quite been packaged in that form factor that just breaks out in the consumer psyche massively and you just have this like extreme deployment. So I think I would say ChatGPT video moment in the next 12 months. And then the robotics moment, I think will be a little bit longer than that. It's 100% coming, but my guess would be it's 3 years. Personally, this is my own personal forecast. Yeah, yeah.

No, I like it.

I think that's about right. And let me just say that almost in the definition of the question, it's like from a consumer perspective, I think that things like Optimus will be doing very useful things inside factories, but that's not the ChatGPT moment. That's not like when the public is like, oh, wow, this thing is changing my life. I want to use this thing. It's ubiquitous. I think that's probably a few years behind, like, useful things in private.

Yeah, that makes sense.

Very cool. Well, great stuff. So much for taking the time. Have a great rest of the time at, at Hill and Valley, and we will talk to you soon.

Say hi to everyone. Thank you, guys.

See you soon. Goodbye. Let me tell you about Phantom Cash. Fund your wallet without exchanges or middlemen and spend with the Phantom card.

Brett Adcock is excited to introduce Hart Robotics, a new AI lab lab building the most advanced personal intelligence in the world. He says, we've been in stealth for 8 months assembling one of the greatest AI and hardware teams on the planet. I want to explain why I started Hark and what we're focused on. Says, I've spent the last 3 years working on the hardest AI challenge imaginable, giving AI a humanoid body. On the digital side, I've been using all the existing LLM chatbots, and I have to say, they feel incredibly to me. AGI in the limit should feel like a sci-fi movie. It should be able to listen and talk. It should have persistent memory and be highly personalized. It should see and touch the world. But we're far from this today. We're crafting a new interface to AGI intelligence that lets you offload your mental workload into a system that begins to think like you, and sometimes, John, ahead of you. We started Hark with one goal: build build the world's most advanced personal intelligence paired with next-gen hardware designed to serve as a universal interface between humans and machines. Did they launch a model?

Like, can you actually— oh, you can request access. Because I imagine that there's really no getting away from benchmarking and people digging into the model, understanding if it's distilled from something or— trained on something. And then also just like the vibe and the smell and like how people actually interact with the bot and chat with it and interact with it and put it to use and see if they get value from it. It will be interesting to see where that goes.

On my side, I'm very excited about robots. And I think it's interesting to, you know, I don't think the job's finished on the robot. Side. He says, I've spent the last 3 years working on the hardest AI challenge imaginable, giving AI a humanoid body, but, uh, job is certainly not finished. So, uh, we'll see. Uh, Brett is certainly ambitious and so wants to get in the arena with everyone else.

There's a lot of labs, every other giga, giga Chad.

Mark Zuckerberg. Yeah. Sam Altman. I mean— Dario Amadei.

Yeah, this was in the news today. Like Amazon launched a new AI thing and—

And getting into, yeah, yeah, it's so interesting. Like, is this primarily gonna be a hardware device that's like, you know, attached to some sort of harness that uses other models?

It's also interesting that it's not vertically integrated. Like they were already training, AI models. So, you know, Brett uses the end-to-end, you know, neural network. Like, he clearly has GPUs that train models at Figure.

Yeah, it's like, it would be breaking that out. It'd be cool. Like, yeah, I struggle to see why, why it should be a second company. Yeah, it's like, I would assume— I'm sure they can work together, but if he's building a hardware device, could that not be like the brain of Figure? And maybe like, maybe he's in I'm just thinking like, okay, what happens if you've got Figure and they're awesome, but then you gotta go fly somewhere and you don't wanna get a second plane ticket for your humanoid next to you. Should be able to just bring the brain. But again, it's hard to be super bullish on this, at least personally, but I'm excited to see what they work on.

Are you bullish on fruit? Fruit Love Island. Sean McGuire was talking about video generation. There's an AI-powered TikTok account that produces a show called Fruit Love Island, and the series is already the fastest growing ever, gaining 3 million followers in 9 days since launching on March 13th. It has videos hitting tens of millions of views within hours and a rapidly growing fandom. People are not happy with this. There's a bunch of community notes that say it's AI slop. I think that's the point. It is. It is, you know, slop. But people are clearly watching it and the TikTok algorithm loves it. They call it AI cinema, which will of course be hotly debated. Udi Wertheimer says the most expensive mistake you'll ever make is ignoring this. In 2026, you can create new intellectual property from your basement and reach hundreds of millions of fans in a week. I don't know that it's exactly there. This is people that might be morbidly curious. They might also be, you know, they might be true fans. There might be fans who aren't subscribed but watch every video. That's the nature of TikTok. Instead, you choose to be fake geopolitics expert on X. It's very dramatically worded, but Apple's App Store is also drowning in it.

AI slop. People are, according to Shirish, people are treating the App Store like a Medium blog, spitting out apps one after another, all with zero users and zero revenue. Apple reviews that used to take hours are now stretching into weeks and even months. More than half a million apps were submitted just last year, highest in over—

Well, we have Delian Asparuhov in the Restream waiting room. Let's bring him into the TV Pen UltraDome. Delian, how are you doing? Congratulations. Congratulations on this year's Hill and Valley. Give us the update. How are things going?

You know, I think somehow best one yet. Sorry to miss you boys on this one. You got to miss out on my childhood, you know, basically wet dream. I got to be on stage with Jared Isaacman. I know.

So I try to think of— yes. Yes. So we had him on the show. Electric. Thank you for making the introduction. One of the best moments on TVPN to date. But what was the focus of your conversation with Jared Isaacman?

I think what was exciting was today was the day that Jared decided to unveil, I believe it was called the Ignition set of policies, where it's probably the broadest change to the space policies in the United States in the past 20 years, in particular about a set of different projects. One, how to basically win the lunar space race. I think even on prior TV appearances, I've talked about how I would love to see NASA go from basically landing a lander once every year to instead once every quarter, once every month, and send robots out ahead of the humans to go establish that infrastructure. Today, Jared literally announced that that's basically the official policy. They literally, starting in 2027, want to be landing robots on the moon every month. And yeah, it's going to be experimentation on paving and energy and communications and things like that, and maybe even trying to use the regolith to form some structures. But that type of testing is what's going to get us to the point when the humans are there, they already have a bunch of experiments that have sort of gone well. The second was around, he is calling it the SR-1, or SR Freedom mission, where they're gonna build the first nuclear-powered spaceship to basically go from Earth to Mars. And then when it gets to Mars, they're basically going to open up the reentry vehicle and fly 4 helicopters out onto Mars and land them, which is just like, the coolest sci-fi thing ever. And then the third area is basically igniting the low-Earth orbit economy. Obviously with my Vardar hat on, it's super exciting to see Administrator Isaacman sort of prioritizing that. It's something that obviously people have talked about for a long time, but I think we're finally getting to ignite it. And then lastly, I think of this as sort of like round one of my sort of future NASA administrator interview. So I think I passed, but my goal is Jared is the youngest administrator ever confirmed. I've got 10 years to make sure that I beat him and take that record away.

That would be amazing. Yeah, the experimentation on the Moon seems super important because NASA's great at doing science and the uneconomical things. And if we can go get some data on what makes sense on the Moon, then industry can flow. Elon put out this presentation about a mass driver on the Moon. I think you've been talking about this for a while. And it feels like this is years away, but anything we can do to de-risk that, to understand is that the thing that we should be doing with Starship and Optimus, then there will be more excitement. But I wanna know from your perspective, there is a new like crazy thing going on in space, the mass driver on the moon. Does that make your job easier at Varda? 'Cause you're like just doing biopharmaceuticals in space now?

Yeah, it does make it a lot easier in that if you think about what it takes to like make a drug in space, there's for sure some super complicated ingredients that we kind of we kind of have to bring from the ground. There's a lot that we do up there though that requires water just to flush out the bioreactor after each run. Right now we just bring the water from Earth. As you can imagine, bringing water from Earth up on a rocket into a satellite, pretty damn expensive. Mining water on the surface of the Moon, sending that for free via a mass driver directly to our station in low Earth orbit, that's a heck of a lot cheaper. And so I get really excited by some of these lunar things in that it's not a place where you can to do microgravity manufacturing because there is gravity on the moon, so it kind of destroys the whole point. But there's a bunch of these like, you know, sort of simpler precursor things. Like, you know, the area that I think will take a long time is like, we're not going to be making, I think, like solar panels or chips, you know, anytime soon on the moon. Like that stuff's pretty complicated. But like basic metal structures, water, you know, propellant, things like that, that'll actually, I think, like happen relatively near term. Like I don't think it'd be crazy to imagine that in like 2027, there's going to be like a rover that has a little ice melting operation that then turns that ice potentially into liquid hydrogen that a future Starship might use for fuel. That is actually doable literally next year, which by the way is an insane thing to say. It's crazy. I'm 19 years old telling you it's literally actually possible to make hydrogen fuel on the Moon with what we are currently doing today. That is not sci-fi. Yeah, that's crazy.

Talk to me about the— I think it was really fun investigating the mass driver. Is it 15 Is it 10? Is it 20? Whatever. But it's just cool to hear someone— 500, maybe, who knows? But it's just cool to see an entrepreneur that everyone knows actually think in decades. And I'm wondering about, first off, like, do you think about Varda on those terms? Do you think about, like, what will you be doing in 20 years? And then sort of in the advice for founders VC hat, like, there are risks to coming out there on a ledge vision standing on stage and saying, I'm going to do this in 20 years, and everyone's like, yeah, it's sci-fi, he's trying to pump or whatever. Talk to me about how you process thinking really long-term and then actually sharing that with your investors, your community, your customers, the world, et cetera.

I'd say the thing that I'm proud about at Varda is like we have had the exact same vision from day one, and we've basically hit the exact timeline that we always both promised, like investors, our employee base, our customers, customers, which has just been this like—

you weren't aggressive enough. Travis is saying you weren't aggressive enough. Anyway, so you've been on track.

Yeah. And like our 20-year vision was always we want to create the like first industrial outpost in low Earth orbit. The reason being that we believe that it's going to be the invisible hand that lifts humanity off the surface of the planet, not just bigger rockets and exploration budgets. But we've taken a very pragmatic step-by-step approach, which isn't like, let's go launch the industrial station from day one. It's like, go do these sort of like, you know, proof point missions, start to get revenue flowing through the system, get pharmaceutical customers on board. I'm super excited to say, can't announce the name today, but within the next week we are going to be announcing that Varda now has a publicly traded pharmaceutical client where we're going to be regularly producing drugs for them in space. And they're like a tens of billions, you know, massive, you know, sort of corporation. Let's bang the gong.

Congratulations. Congratulations. Preemptive gong.

Whoa. Bang, bang, bang.

I mean, and I see that as like, that's the starting line. You know what I mean? Like when you talk about like a 20-year-long vision, it's like, it's been 5 and a half years to get to this point. The whole point of starting Varda was that we would actually go make space drugs for drug developers. We're finally there. We've got the first handful of those, but like we still have a long ways to go. There are plenty of software companies that get 5 and a half years in, they've literally basically built the entire product and that's basically it and they're coasting on it for the rest of their lives. We literally have just gotten to the starting line. We have made our V0.5 of the product. We've laid out to all of our, you know, sort of employees and customers and investors what V1 through V20 look like. And we know what they look like. It's just you can't just skip to V20. You have to go, you know, one step along the way. Next version, yeah, right now we've got these like satellites with pods, by the way, 5 feet to the side of me. We've got actually a flown reentry vehicle here at Hill Valley, which is pretty cool. Next version is going to look like, you know, sort of mini space planes, bigger bioreactors.

Cool. Very cool. Did we—

A state actor took you offline. Okay, we're good.

Sorry about that. We're back. We're back.

I was worried there. But yeah, Helmand Valley Forum 2029, we're gonna have a full space plane here with bioreactors on board.

I can't wait. Jordi? Amazing. Sorry. No. I was cutting you off. What is the— What else should people be tracking in space? Everyone's interested in space data centers. Everyone's interested in manufacturing stuff in space. Is there a next next thing that you're starting starting to hear rumblings of either in the academic community or in the early-stage startup? I've seen some stuff about like put solar panels up there, beam down the energy. It feels like it's pretty useful if you have the energy up there, just do stuff up there. But what else are you interested in exploring or at least like hearing a pitch for?

I think one macro trend that I point out and then I'll describe some pitches. The macro trend is like, look, when you look at the market caps of all space companies before today, that were like publicly traded. Yeah. You're talking about maybe like, you know, $15, $20, $25 billion like total. Yeah. SpaceX is about to go out at anywhere from like a $1 to $2 trillion valuation. Just the amount of capital flows that are about to happen that are both people obviously buying into SpaceX, folks that are rotating from their SpaceX position to potentially next-gen sort of application areas that they're interested in. This entire field is just going to have a like huge amount of attention, you know, basically brought to it. Yeah. And so, yeah, we're definitely paying attention to the next application areas. I like to think of space in some ways like a highway where it's like, you know, when you first only had a handful of cars there, everybody kind of had to bring their own gas tank. Once you got thousands of cars up there, well, now all of a sudden you can start to invest into a gas station, right? And start to have supply chains around it. Heck, even like, you know, there's people starting to think about not just beaming solar power down to the Earth, but also beaming solar power to other satellites. And so you start to think about like, what do power utilities look like? You know, folks like Brigitte Mendler at Northwood that are thinking about, okay, Starlink provides internet to everybody on the ground. Yeah, but like at Varda, we don't have internet on our satellite. We get to talk to it like for, you know, 15, 30 minutes once every 3.5 hours. Yeah, Brigitte Mendler is hopefully going to make it so that I have 24/7 internet basically in space and can talk to my satellite whenever. And so I think we think about these things as sort of like there's like layers of infrastructure, and as you build up each layer— reusable rockets, space factories, gas stations, ground stations— now you start to get to do the application layers on top of And so I look forward to— I think one day you'll see Founders Fund lead around in a lunar ice mining operation. I don't think, you know, we're quite ready for that in terms of all the infrastructure. But like, I also don't think that's like 10 years away. Like, I would bet that in the next 5 years we lead a like $10+ million financing round into a lunar ice mining operation.

I can't wait for it.

There's also a satellite bus company that you invested in. How are they doing?

EnduroSat. The CEO's, you know, sort of here. They're rocking and rolling. They like continue to somehow be profitable, EBITDA positive, you know, north of 2x revenue growth, you know, sort of year over year. By the way, there's like literally no other company that's at their scale, you know, sort of doing that. And so, yeah, he's deeply impressive. He's got this like huge 250,000-square-foot facility in Bulgaria, obviously out of all places, but it is like the most modern, looks like Samsung Electronics manufacturing line, and he's literally pumping out like satellites left and right. So they're rocking and rolling. That's amazing.

Well, congratulations on another successful Silicon Valley. Thank you so much for taking the time to come chat with us.

Yeah, thank you for putting on a suit.

Yes, you look fantastic.

It's a great, very bipartisan suit. You know, we love Republicans, we love Democrats.

Do you have one, one red shoe, one blue shoe or something?

No, no, I just stick to all green today.

You know, all green, money, money, baby. Green is our signature color. Well, thank you so much. Have a great rest of your day. We'll talk to you soon. Goodbye, boys. Bye. Let me tell you about Cisco. Unlock critical infrastructure Infrastructure for the AI era. You can unlock seamless real-time experiences and new value with Cisco. And let me also tell you about Railway. Railway is the all-in-one intelligent cloud provider. Use your favorite agent to deploy web apps, servers, databases, and more while Railway automatically takes care of scaling, monitoring, and security. Our last guest is Zach Dell from BasePower. We're very excited to talk to him. I believe he's getting set up, so we will bring him in in just a few minutes, but stay with us, stay tuned.

Breaking news is that Sora, from the Sora account, we are saying goodbye to Sora. It's everyone who created with Sora, shared it, and built community around it. Thank you. What you made with Sora mattered, and we know this news is disappointing. We'll share more soon, including timelines for the app and API and details on preserving your work. The Sora team. I think this makes sense. Just roll. It's an amazing creative tool. Roll that functionality into the app that already has has about a billion people using it. It was a very cool experiment. Bill Peebles and the team crushed it, broke the internet, but the tool will live on. So I think it makes a lot of sense.

This red lighting is really getting dramatic. Red alert. I like it. The production team's been working overtime, so thank you to everyone there. Well, back to the debate about AI-powered video. Somewhat sore related. Kyle Harrison said people will call this the future of media, referring to the AI Love Island, but that inclination needs to be aggressively disagreed with. Content creators will fill the market. Don't push to stop creation from trending towards slop. Push to lift the global conscience to be hungry for more than slop. And Olivia Moore from Andreessen Horowitz pushes back, says going to respectfully disagree with Kyle on this one. There's a lot of AI slop out there, but this series has has consistent characters, a coherent and entertaining narrative, and real creative production. In my opinion, you could argue that the human Love Island is more slop than this. So there's a debate over which is sloppier, the AI Love Island or the real Love Island. We'll let you be the judge. But we have Zach Dell from FacePower in the Restream waiting room. Let's bring him into the TV and Ultra Room. Zach, how are you doing? I'm great. Okay, you're— you are certainly running. You're running. You're running. Just— it look— I mean, I mean, you're— you're looking like a president. So you're running?

I can neither confirm nor deny the allegations. Well, you know, I'm a patriot and I'm glad to be here in our nation's capital. Yes.

For those— for those who will learn about your presidential campaign in a number of years. In the meantime, tell us what you're doing to bide your time before you take the national stage.

I'm the co-founder and CEO of Base Power, and we are a vertically integrated technology company working to provide more affordable and reliable power to the country. So we build power plants out of batteries and software, and we do it in the deregulated competitive markets in Texas and soon in other parts of the country and also in the regulated markets for utilities. Okay.

And what's the shape of the business? Because I'm familiar with, with, you know, energy products, battery storage that can go on a single family home. And then obviously there's a massive data center boom and people need We need gigawatts and gigawatts of electricity stored. Is, is one the focus? Are you doing both? How is it evolving?

It's a great question. So our product today is electricity for homeowners. So you sign up with Base and we sell you power. We install a battery on your home that serves the grid when the grid's up and running. And when the grid goes out, you get that battery to back up your home. So you get all the benefits of home backup without the high upfront cost of a home battery or home generator. And then we're able to save you on the order of 10 to 15% on your electricity bill. Now, we also build battery, battery deployments or distributed power plants in the regulated utility parts of the market. So in those, in those parts of the market, we're actually not your utility. We build a power plant for the utility. So we say, hey, utility, you'd like a power plant, 10 megawatts, 20 megawatts, 100 megawatts. We'll go build that power plant for you faster and cheaper than you could otherwise. Otherwise build a gas plant or a coal plant or a utility-scale battery plant, and then we'll give you the keys to that power plant. Now, the interesting thing is we can actually use this capacity to accelerate the AI infrastructure buildout. So we can deploy batteries around data centers, discharge those batteries in peak hours when data centers are pulling power, offset the load of the data center, and add headroom to the system so we can deploy more compute on the existing system.

And how should I think about the path to like the gigawatt scale? You know, you see these numbers around every AI company. I imagine, I mean, as a young company, you're growing very fast, but how are you thinking about getting to, you know, data center scale? It feels like an entirely new challenge compared to home power, but maybe I just have the scale wrong.

Well, we've been thinking in gigawatts since day one. On. So we'll deploy a gigawatt-hour of storage this year. We're actually starting production on Monday at our factory in Austin. Okay. We'd love to have you guys come by and see it up close and personal. It'll be capable of 4 gigawatt-hours a year. We have a second factory coming behind it, which will be much larger, and we'll be ready to talk publicly about that soon. Yeah, but we'll be deploying gigawatt-hours of storage on the grid in Texas and beyond this year and in the next couple years.

And yeah, Jordi, last time we talked off air, I asked you why is now still early at Base Power? You gave an amazing answer. I wanted to ask you live so everyone else could hear it.

Well, you know, we are in the middle of a paradigm shift in the energy industry, and the last 50 years of energy have really been defined by coal and natural gas. And we believe the next 50 years are going to be defined by solar and storage. And the existing companies in this space are not necessarily technology-focused, engineering-led, or R&D-driven. And we are exactly that, right? So we are the modern technology company oriented around this new paradigm. And we think the opportunity is to become the largest energy technology company in the world built on this new paradigm of solar and storage, built around the strategy of engineering-led, technology-driven -driven and R&D-focused. So we're going to deploy hundreds of gigawatts, hopefully over the next couple of years in Texas, in the U.S., across the globe, in other, in other countries as well. It's a really exciting time to be at the company and it's a really exciting time to be building in power.

What does the supply chain look like today, in the future? Where are the— where are your supply chain bottlenecks? We talk about chips all the time in AI, but I imagine that there's a whole process. We've talked to, you know, about a number of Tesla and Amazon. They're buying mines, they're buying refinery equipment. Like, it's a really deep supply chain until you can actually deliver a battery pack. Where does all this go and where are the key bottlenecks that we need to be thinking about as we scale battery production in America?

You just have to vertically integrate to control costs and control the inputs. So that's why we're building our our first factory in Austin, and we'll have a second factory coming right behind that, is so we can control as many of the inputs as possible. So producing these products is very difficult, and you need all kinds of different inputs. And the bill of materials is very long, right? And you get the different products from different parts of the market, different parts of the economy. And the more you can control it yourself, the better. The more you can have security over that supply chain, you can drive those costs down. So there's not any one piece that's particularly constrained where, oh, we can't get memory or certain things that you're seeing show up in the compute supply chain crunch. We feel pretty good about our supply chain. We spent the last 3 years building out our supply chain, building relationships with suppliers because we had this vertically integrated strategy from day one.

What do you think about the, like, the best case scenario decade or two decades just in the battery industry broadly? Like, I remember when the iPhone came out and it was like, wow, like this thing can run all day long. It's been 20 years. It still has about a one-day battery. I know that that's, we're doing more with it. We're, you drawing more energy, but is there some sort of breakthrough that's maybe deeper in the academic literature that you think could unlock like the 1-week-long iPhone battery or something like that? I don't even know if we demand that because we just charge them every night, but like, is there something that we can do to get on like a Moore's Law type of curve for battery storage capacity, or is it purely just production cost for the current energy densities?

Yeah, so there's definitely good work being done in the battery chemistry part of this. Of the scientific literature and there's, you know, interesting new chemistries coming out that I think will be longer duration and more efficient, lower, lower cost to develop and better in different ways. The reality is LFP technology, which has kind of emerged as the dominant technology, lithium iron phosphate, is really performant. And the reality is the cost to deploy a battery is mostly not the cell. It's kind of everything above the cell. It's, you know, the pack and the power electronics and the deployment. And the customer acquisition and the maintenance and all the things around it. And so, you know, to drive down the landed cost of power, to deliver low-cost capacity quickly, which is our mission at the company, why we exist and what we think it will take to win in this industry, you have to do everything well, right? You have to do, you have to, you know, build the brand, you have to have the deployments, you have to be able to do manufacturing, logistics, warehousing. You need to be able to understand the policy implications You have to build the software to interface with the wholesale market. So you really have to build this vertically integrated company to drive costs down at the system level. And I don't think it's going to be, you know, a whiz-bang breakthrough in new physics that's going to break open the industry. It's going to be a company that comes in and innovates on all different parts of the stack and wins kind of at the system level.

If you do that, will you be able to supply electric batteries to cars?

We're not really focused on the auto value chain today. We think that's pretty well served. Why?

Why is that? Is there something fundamentally different about— because I imagine you just take a battery pack that's on the side of the side of the house and strap some wheels to it and you're good to go. But it's obviously more complicated. But like, help me understand, like, is that, is that just like more competitive because there's more suppliers? Or it's more deeply integrated, would require different machinery to actually produce batteries of a certain size?

Our mission as a company is to make energy affordable and reliable, increase energy abundance in the country and eventually across the globe for humanity. And building cars doesn't really further that mission. So that's not really where we're focused.

Yeah, that makes sense.

A lot of talk around energy costs and data centers There's obviously a bunch of data centers in Texas. Are any of the markets that BasePower is in dealing with any of these dynamics? What are you seeing? What, what are you seeing like actually on the ground?

Yeah, I mean, there's a massive data center buildout basically anywhere where there is fiber, power, and land. And, you know, Dallas has emerged as I think the second largest data center data center destination behind Northern Virginia in the country. That's obviously a core market of ours. And we are working with data center developers in the state and also in other states outside of Texas on solutions whereby we can accelerate interconnection of AI data centers by deploying distributed batteries around those data centers. So massive AI buildout. You know, there are tons of people, I'm sure, who've come on the show who are, you know, know more and are more well-versed in the data infrastructure built out than I am. But if I was a betting man, I would, I would say I'm quite long compute. And I think, you know, the compute wave that's coming is, is not a wave, it's a tsunami. And it's going to, you know, not slow down anytime soon.

What's the shape of your workforce? What are you hiring for? How much of it is blue collar, white collar, some sort of hybrid? What does BasePower look like in a few years?

Yeah, we're hiring software Software engineers, electrical engineers, mechanical engineers, folks, you know, in accounting and finance, in business operations, you know, deal guys, idea guys, you know, everything. We got room for you guys. We're looking for people who can communicate, creatives. You know, we're building a vertically integrated technology company and we genuinely believe it can be one of the largest companies in the world. And to do that, we're going to have, you know, a really compelling consumer brand, a manufacturing organization, a design engineering organization, a deployments organization. So yes, we're hiring tons of electricians. We're hiring warehouse technicians. It's going to take a village. And it's really, you know, one of the most fun parts of the job. We've got, I think, you know, one of the best teams in technology. And, you know, it's a lot of fun to work with them.

Yeah, I can't wait to visit. Yeah. What has it been like building a company in Texas?

That's my last question.

It's an incredibly It's a really good place to build. Texas is very pro-business. And I, you know, note to all you founders out there on the coast, come on down to Texas. We'd love to have you. I picked up a lot of interesting neighbors in the last couple of weeks and months, and we hope more people come down and come build with us in Austin.

Fantastic. Well, have a great rest of Hill and Valley, and we will talk to you soon.

Great to see you. Thanks, everyone. Always a pleasure. Goodbye. Cheers. Bye.

Well, That concludes our Hill and Valley coverage for today.

No more guests. I got a great post from Gary Tan that we can cap the show off with. He says, "I guess the amazing thing that my haters don't understand is you have no idea how much I eat your hate for breakfast. I am uniquely a person who is driven by all the energy you give me in particular." Love it, love it.

Prime Agent says, G-Stack Barry. Gary better than M&M Gary. This is fantastic. And congrats to Gary Tan on another YC Demo Day, which happened today. We're going to be recapping with him and some other folks from YC over the coming days and reviewing the companies that come out of that batch. I saw some news from some folks who were writing checks and investing in some companies. There's a lot of exciting stuff coming out of YC Demo Day 2026.

And we'll end the show with a note I have a note from Naval. He says a lot of software is about to get a lot better right before it becomes unnecessary. Interesting. What does he mean by this? Who knows?

Who knows? We'll let you figure it out. We'll let you figure it out. Well, thank you for tuning in. Leave us 5 stars on Apple Podcasts and Spotify. Sign up for our newsletter at tbn.com, and we will see you tomorrow at 11:00 AM sharp Pacific. Pacific time. Throw some flashbangs.

We love you. Get ready tomorrow. Goodbye.