YC Demo Day Lightning Round, New Snap AR Glasses, SpaceX Rips | Garry Tan, Andrew Lee, Stamatios Floratos, Hugo Frisk, Efraín Torres, Russell Smith, Payton Case, Akshay Trikha, Diana Hu, Harj Taggar, Connor Hayes, Luke Burgis, Anda Gansca

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Today's Tuesday, June 16th, 2026. We are live from the TVPN Ultra Dome, the temple of technology, fortress of finance, capital of capital. Let me tell you about Ramp. Time is money, save both. Easy to use corporate cards, bill pay, accounting, and a whole lot more all in one place. Sorry about the delay. We had a little bit of a technical issue. Glad everyone's here. Thank you for tuning in. It's YC Demo Day.

Thank you for never doubting.

Never doubt us ever. No, it's okay. Every once in a while you can—

You can doubt us a little bit.

Pop off in the comments, pop off in the chat. But we have YC Demo Day. We have 1, 2, 3, 4, 5, 6, 7 YC founders joining, then 3 YC partners. And then we're going around the horn talking to some other folks. Threads just hit 500 million monthly active users. We're having Connor Hayes back on the show for that. Luke Burgess is here. Burgess is here with his new book. The One and the 99. And so we'll go through that. Not a lot of time for the news, but we'll take you through it anyway.

And in the middle of guests, we'll jump in for a little news.

Exactly.

We love, we love, love the news. The big news—

Big news, Jordi.

Is that SpaceX ran like absolute crazy after hours last night. I kept getting push notifications and thinking that can't be right. And then I would double-click in, check a little bit, and I would say—

Yeah, the headlines are crazy.

So yeah, so the big one is SpaceX.

There's so many of it, just like it's passing this company, passing this company, passing that company, and you're like, whoa, this is a crazy, crazy time.

So SpaceX— Bigger than Amazon. Sitting comfortably in the top 5 company.

You got NVIDIA at $5 trillion, Alphabet and Apple right around $4 trillion. $4.5, then Microsoft and SpaceX neck and neck, just shy of $3 trillion. And it basically makes their, their Cursor acquisition free. They paid $60 billion in new stock for the company and their market cap, SpaceX's market cap, more than quadrupled and added, more than 4x'd the price of Cursor acquisition.

I believe they had until Q4 to actually pull trigger on the Cursor deal. Like they built in a window.

They did it now?

I bet you there was some terms that weren't public that Cursor would've wanted to make sure that they got in as quickly as possible.

Sure, sure. Because— If the stock's running, you wanna get in.

It's done really well. Who knows where SpaceX will net out? I mean, I thought we'd be at $2.4 trillion by the middle, by basically the last hour of trading on Friday. I was incorrect at the time,, but it's obviously continued to run. And there was another scenario where SpaceX could have effectively acquired Cursor at an even higher, at an even higher valuation. But I think it's a great, fantastic outcome for the Cursor team. Obviously, OpenAI is a big Cursor investor, Thrive, A16Z, Coatue, and others that, that I'm unfortunately forgetting, but—

What was Paramag saying about this? He said it's the biggest VC-backed— in the past 5 days, we've seen the biggest VC-backed IPO ever and the biggest VC-backed strategic sale ever. We've never had an M&A of a VC-backed company, young startup, north of $50 billion. Like, $60 billion is so, so big. We sort of lose sight of it because we're talking about a trillion dollars for this company, $3 trillion. For that company, but $60 billion is beyond a home run.

Yeah.

And it happened in an M&A, which is crazy.

And there's, I would assume, a large number of the retail investors investing in SpaceX were not necessarily even that familiar with Cursor up until today. I did see that. So if you're waking up today, you're like, wait, SpaceX just acquired one of the hottest AI companies in the world. Coding apps. with billions of dollars in revenue. Like, this is so bullish. Obviously, a lot of the more institutional investors or people that had been following the company privately were well aware that they had the option to do this, that they would almost certainly take it.

Yeah.

The takes are all over the timeline. Quinn Thompson says, this is brilliant corporate finance. Use your newly printed low float retail inflated currency to acquire real businesses ahead of the lockup expiring. Probably the most creative, accretive way to sell as much equity possible into IPO pump. I wonder what acquisition is next. That's very interesting. Nick Carter fires back and says, you'd think the people buying the equity would also be aware of this. And that's a good point. But the question is like, are there more acquisitions in the pipeline? Because Tesla has not done a lot of acquisitions. Elon's always been a build, not buy operator or founder. Right.

Tesla itself.

Yeah, that's a very different scenario. What I'm talking about is like, there are companies, Meta is very acquisitive, Google, Apple. Apple's like on the smaller side, but they still do deals more frequently. It would be very interesting if we're seeing, you know, one deal a month and he's sort of putting together the pieces of buying up Neo Labs and compute capacity and Neo Clouds and rolling everything up. That would just be a completely different operating philosophy, but, given where the stock is, given how smooth this deal went and where the market cap of SpaceX is, it's not the craziest thing. It would be a big pivot in his strategy though. Business Insider has a deep dive on Cursor's wild ride. Michael Truel didn't pay himself for years. Interestingly, Cursor once made up 40 to 50% of Anthropic's revenue. That is a crazy— —giration in the market just shows you how quickly things are changing. Went from it's all Cursor, that business is just funneling to Cursor, Cursor's the front door to this business. Then it's like, oh, it's all these hyperscalers that are spending $1 billion, $500 million a month. And so the whole landscape is changing. Nothing tells that more than Anthropic telling Cursor that Cloud Code was just a research effort. This goes back to the Dylan Field, like, were they consistently candid? Or maybe they really just did think, hey, yeah, this is just a research effort. You do you, and then realized later, like, whoa, whoa, whoa, we need to be a player in this. We cannot be in the middle of this situation. So we gotta do our own thing.

Owning the end customer relationship.

Yeah, and so wild, wild ride.

Yeah, similar to, I think, the messaging to Figma and Canva around Anthropic's design tool.

Yeah, it's tricky. Every AI company is a general use technology. They're using it for everything. Questions about like, will you maintain value if you're in the token path? Do you need to be like, do not build a company that depends on the models getting better, but if the models get really, really good, like what can't they do? And so constantly we see every company competing with every other company as every hyperscaler has an LLM at this point and every SaaS product has other products 'cause they can launch features faster. And so the competition is heating up across. All these different companies.

Next time we have Michael on the show, we got to ask how he paid the bills for all those years.

Yeah, what's he doing? Crashing on couches or something?

Gotta ask.

I don't know.

Taking out massive loans against the company, maybe.

Anyways, 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 powers it.

Snap, snap. Also has some big news today. We're gonna get to it.

We'll get to that after our first interview with Andrew Lee from Tasklet. He's the founder and CEO. Andrew, welcome to the show. Thank you for the patience and joining us on such a busy day. How is Demo Day going? How are you?

I'm doing great. Thanks for having me. I wanna be upfront. I can neither confirm nor deny the SpaceX acquisition rumors.

Oh, okay.

But they're flying around.

I see, they're flying around.

They're flying around Demo Day.

Elon's probably there at Demo Day shaking hands, trying to scoop up, roll up the entire scratch, maybe. Who knows? He's got the stock to do it.

No comment. Demo Day is great. We're having a good time. There's 1,000 people here. There's 200 companies. Wow. It's a good time.

Amazing.

Did you pitch already, or is that ahead of you still?

Not yet. We're in Group 4, which is going to be this afternoon, and it's actually my co-founder who's going to be up on stage giving the talk.

Cool.

I'll just be the pretty face over on the side.

OK. Well, give us some backstory on yourself and tell us about the business.

Yeah. So, uh, as background, I was, uh, the thing I'm probably best known for is I was one of the founders of Firebase.

Oh, yeah.

So, this is my second time through YC. I did, uh, the summer 2011 batch.

Yeah.

Um, we sold that company to Google in 2014.

Cool. Yeah.

I was there for about 3 years. Um, this, this company has been a very interesting story. We actually started in 2020 as a better Gmail. Like, we tried to build a new email experience. Raised a bunch of money, hired a team.

So you quit Google to try to, to try to eat Gmail alive.

Yeah.

I had already left Google a couple of years before, but I saw them shut down Inbox. And I was like, man, what are these? This is a huge, huge product. Like, what are these guys doing? We should do a better job. This is a terrible idea. Don't do it. Don't invest in it. But just as we were getting ready to shut that thing down, LLMs got good. And we're like, holy crap, we can take all of this data that you have and we can feed into a language model and we can like draft emails for you and we can do interesting types of search and we can do categorization. So we started kind of pulling that string. And around about this time last year, we had this really good agent inside our email client and we had a bunch of users being like, hey, I love your product, but could you just get rid of all this inbox crap, right? Like the UI is getting in the way.

Yeah.

And so we spun it out and we had a, like, it's a totally new product, totally new code base. And this is Tasklet., and we launched that in October, and that's gone super, super well. And that's, you know, that's why we're in YC, um, that, and that's gone, you know, at the beginning of the year we were at about a third of a million run rate. We're at a $7 million run rate now, so it's like a nice, nice fast ramp.

Um, and— Is that the bar now? Like, is, is there, you know, are you meeting other companies in the batch that are, that have been able to ramp that, that quickly?

I, I think we have the highest revenue of the batch.

There we go.

Let's go.

There we go.

Well, why don't we go hit the gong?

Oh, yes.

And then we can— boom. That's for you. Love that. Love that. So this feels like— so we were looking at our little summary here. AI agents that connect across work tools, run 24/7, and take ownership of recurring workflows.

Does big tech hate you? Like, because I feel like the whole point is walled gardens, that's what creates value accrual, that's what keeps the value accruing to the work tools that big company CEOs love and extract a lot of value from. And you're coming in here and digging a hole under the wall of the garden and throwing a ladder over the top and digging a hole right through. The walled garden.

Absolutely.

How do you maintain those integrations if the actual platform is maybe hostile? We've seen reporting about this where different companies have tried to integrate across, and then they've wound up with sharp elbows. I think a lot of them have figured it out. But how do you think about working copacetically with the work tools that you integrate with?

Totally. So AI has totally changed the game. 2 years ago, if you wanted to integrate with a bunch of stuff, you had to hand-code a bunch of integrations. And there were companies like AnyDen and Zapier that just did that. That was their moat. And our secret sauce is that we can dynamically generate the integrations with AI, like when you need them.

Sure.

So we have a bunch of canned integrations. Some of them we've hand-coded and made them really, really nice. But even if you ask for an integration we don't have, the AI can generate one for you. And this is super powerful, not just because it lets you go outside the walled garden, but because it lets you connect to things that might not be public at all. So if you're a company, a lot of times you have internal APIs., and you're like, hey, I wanna have some integration that hooks up to like Notion and HubSpot and Gmail, but then also like my random bespoke, like internal API. And you can't do that with, you know, any of the products from, from, you know, big tech. You can't do that with, you know, Claude or, uh, or OpenAI. Yeah. But our product, yeah, sure. You can integrate, you know, via API with this thing, with MCP, with this thing, with a, a pre-canned connector with this other thing, and they can all work together.

Mm-hmm. What's the state of search these days? I feel like we've seen incredible progress in AI and agents. And then when I have the same frustration that you had when you were thinking about working on email, I'll type in some keyword, you know, like YC, and I will get some cookie, some string that's stuffed in a receipt from some coffee shop, and it has nothing to do with Y Combinator. The context isn't there. Apple Intelligence is rolling out. It takes like 5 days just to index everything into some sort of RAG database. Like— Yeah. —why are we falling behind there? Is that a key—is that key to your strategy, or is it something that it's a problem for someone else to work on?

So I think agents, again, have totally changed the game here. So in Shortwave, our email client, the way we did search was the, you know, the vector database approach, right? We embedded all your emails, we stuck them in a vector database, we had this interesting search stack, and the goal there was to have, like, the search results be good.

Yeah.

And it turns out With— if you have a really smart model and you have an agent, you don't actually care that much if the search results are good as long as you can run lots of searches. So what we found in Tasklet is we don't need to like ingest all your email and index it. We can hook up to the regular APIs and just run a whole bunch of queries in parallel, look at the results, adapt, iterate.

Just keep refining.

And so the results are almost as good without any infrastructure. So it's a lot cheaper, you can connect to more stuff. So I think if you find— use Tasklet, you can kind of hook it up to anything.

Yeah.

And you'll get surprisingly good search results without any special backend support.

But I imagine that that's sort of slow right now. And for a company like Google to roll that out to a billion users, you know, for free immediately, that's gonna be really expensive. So that's still a ways out. They need to actually chop through that. But we could expect that search will get faster and better over the next couple years.

Yeah, I think that is the big drawback. And like, as an example, for,— for prep for Demo Day, I wanted to make sure that I chatted with the folks that were here that had reached out to me. And I've had people reaching out over a period of months. And so, I took Fable 5 back when that was still a thing.

Sure.

And I pointed that at my Gmail and I said, "Go find everyone who has cold emailed me in the last N months who might be at Demo Day and like give me a spreadsheet with those folks." And it spent like— and stack rank them, right? Like I want to know who should I talk to first and so on., and it spent like half an hour. It spent like $60 running this thing, right? But the end of it, I had this spreadsheet of like 100+ folks that was like carefully researched and like ordered, and like it found every— like there was no one I could think of that it didn't find in that process. So if you're willing to spend $60, if it's worth it to you, like, great.

I love it.

Are you—

last question— are you capital constrained?

Hmm.

Like, I'm assuming you have a bunch of offers. Maybe you already finished your fundraise. But why even raise? It feels like you guys seem to be making, I would imagine with that kind of revenue ramp, it'd be hard to not be making money right now.

We are not capital constrained. We actually already closed a $20 million round in April with USV and Lightspeed and some other folks. But they're, you know, we're competing directly with Anthropic and OpenAI. They've obviously raised a lot more money and I think we can put it to use. So we are raising more money now.

I like just saying the actual reality 'cause there's a lot of founders that would come on come on and be like, well, actually, like, we do something that, like, you know, and it's like, no, everyone is competing all the time. And, uh, it's better to just accept it and, uh, play the game.

So 100%. And I think Corgi set a new bar with, you know, 3 weeks from, from what was it, Series B to C or whatever they did there. So, you know, why wait?

3 days. Do it in 3 days.

3 days. I love it. Uh, awesome. Thank you for coming on.

Yeah. Great to meet you, Andrew. Congratulations. Congrats on all the hard work.

We'll talk to you soon.

Talk soon.

Thanks for having me.

Have a good one.

Cheers.

Let me tell you all about the New York Stock Exchange. You wanna change the world? Raise capital at the New York Stock Exchange. Our next guest will be sitting in that same seat, slotting in in just a second. We have Stathios—

Andy will be working on—

Eden Robotics.

The microphone.

Oh yes, yes, yes.

Good Alexander says, "I pay for Starlink." It's a great product. Cursor is also a great product. Codex is a great product. And Claude with Fable is ridiculous product. That's the main difference between now and 1999. All of this stuff is awesome.

So total white pill, then read the follow-up.

I don't think you can really compare this to 1999. I think it's actually unprecedented. If AI doesn't work, the global debt bomb explodes and there's a Great Depression. The 1999 tech bubble popped and things were generally—

Fine. Yeah. So it is higher stakes, but it's more impactful. So he's, I mean, it's a good point to not try and draw too much comparison to 1999 just because it's technology, it's a technology-driven boom. It is very, very different in terms of the financial structure and also the impact, the revenues, the rollout, the opportunity. All of these things were just in higher stakes territory, I suppose. Anyway. We have our next guest from Eden Robotics in the YC Demo Day stage. How are you doing? Welcome to the show.

Hey guys, all good. How about yourselves?

We're doing great. We're doing great. Thank you so much. Introduce yourself and the company.

Yeah, so I'm Sam, CEO and co-founder of Eden Robotics. We're making general purpose robots for manufacturing, warehousing initially, and everything else right after that.

How general? Are we going humanoid? Are we going wheels? Are we going robot arms? Semi-humanoid. Semi-humanoid? What does that mean, centaur?

Yeah, centaur. So the body, the legs are, there's 4 legs like a horse and a human.

But yeah, what does that actually mean?

So that means it's a wheeled base robot. So it has wheels, but it has 2 arms which are placed like a human in our shoulders, same way we have. And it also doesn't have Dexter's hand, it has grippers. Which fun fact can do more than 80% of work in industry.

Interesting. What about the wheels are important to decide? Like a lot of manufacturing facilities have very flat floors. So I imagine you don't need really any stair climbing ability, which some wheeled robots can do, but do you need to be omnidirectional? Do you need to change path? Is it just about optimizing battery life? Like what are the trade-offs that you decide when you're building the base?

Yeah, so when you're building a base, really, when you're going with wheeled, it's not going to be as general purpose as legs. Like legs could go anywhere. But it doesn't have to be. And you have a massive gain in both cost and energy. Legs are extremely expensive in terms of energy and also in terms of like simply cost.

And also I imagine you can put way more battery pack on top of like the wheeled base, right?

Yeah.

Half our base is just the battery. Yeah. So half the base is just the battery and then the other half is the compute.

Yeah.

And that's it. So how long, is there some sort of like sweet spot for once you have a robot that can roll around and do work in a manufacturing plant for 6 hours without needing to recharge, that's the sweet spot? You know how like 300 miles of range was like the sweet spot for electric vehicles and under that you start getting range anxiety?

Yeah, so I think 6 hours is too low. Right now our robot is using a car battery. It can run for 12 hours. But with our own—

Not an electric car battery, just like one of those like bricks that's a car battery?

Exactly, one of just a really big car battery. And with our own battery design, it can go for 20 hours and optimize charging for like these 4 hours and not have to like stop for 4 and work for 20, but like optimize throughout the time to charge enough.

You got a car battery in there. You thinking about putting a V8 in there maybe? Why not?

Probably not. Probably not.

Terrible, terrible quality in the factory.

So one of the, You know, we've had a bunch of robotics founders on. I've been trying to understand what some of the kind of like economic challenges there's gonna be to rolling out humanoid-esque robots. When I see some of these humanoid form factors, I'm thinking like, look how many different motors it has, how much wear is each of the motors gonna be taking at any given point? And then trying to run the numbers on what is the cost of the unit, what is the depreciation gonna look like over the year, how often are you gonna have to be repairing different components to actually make it competitive with a human, which you can hire for, let's say, $30,000 to $40,000 a year depending on minimum wage in a certain area or type of role. Because the— aside from humans being cool and funny, they also go home after work and they feed themselves and they repair, they sort of are repairing them, repairing themselves while they're sleeping, right? So that's like sort of off balance sheet sort of like activity that's happening that ultimately benefits the business because somebody goes home, eats, sleeps, and then they come back to work refreshed, ready to go.

Yeah.

That's a crazy way to describe human workers, but I get it.

But yeah, just like comparing these two things, a robot, it doesn't go home at the end of the day. It might need to be repaired, it might need to be updated, and it doesn't happen unless the company actually pays for it.

So the biggest kind of like hardware risk factor is just the actuators. Really nothing else would require maintenance. Everything else would be able to last pretty long time. Right now, we're at this point where you have actuators that are actually good enough to last like 3 years and last this overusage. It used to be that these actuators would overheat very quickly, and you would be able to run for a very short amount of time. And there are some humanoids today, like for example, Unitree robots, they're very famous for overheating very, very quickly.

Mm-hmm.

But there are actuators in the market, and we are using such actuators that actually can sustain long hours of operation. We run it for for example, for 10 hours during Alumni Demo Day. It didn't— there was no hardware issue when it came to the actuators, and it went pretty reliably. We expect that these kind of actuators would have a useful life of about 3 years. And in the case of the maintenance, so our whole thing, by the way, is we're not selling these robots. So we're selling the labor. And in fact, we're not even leasing them on a monthly basis. We're charging per hour.

Hmm.

So we're charging $10 per hour. Which is actually found that customers love that idea much more than they love the lease idea, 'cause they have no mental framework, right? They have the mental framework of a human worker. And so how the maintenance would go is if a customer has a robot somehow breaks, there's a problem with it.

And sorry, is it per hour that the robot is actually running?

Yes, so it's per hour.

Okay, so you're not just saying, "I'm gonna charge you 24 hours a day for this period."— they're only paying if they're getting actual time.

It's like a Waymo. You're used to paying $20 to get across town. You pay $20 to get across town.

Exactly. We do set minimums, obviously, 'cause we need to keep the hardware at the facility, but it's just whatever is enough for us to keep the hardware there. Everything else is adapting based on usage.

Mm-hmm, mm-hmm. Well, congratulations. Thank you so much for coming.

Did you already get the round done?

Not yet, but we're very close.

Good luck.

Love it.

Good luck.

Great to meet you. Come back on soon. Have a great one.

Thank you. Have a good one. We'll talk to you soon. While we bring in our next guest, 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.

Breaking from Semaphore.

Yes.

Netflix lost out to Fox in pursuit of Roku.

How is that possible? I mean, yeah, it is interesting the lore there. Netflix sort of created Roku, but the real question is, like, why would Netflix want to buy Roku? Like, the boxes? That just seems like it makes so much less sense. So in terms of lost out, I can imagine.

It's a platform. They sit as an application on a platform that represents like 40% of connected streaming hours.

Yeah. I don't know. I'm not surprised they lost out because I would I would be surprised if Netflix— like, when Netflix was bidding for Warner Brothers, that made a lot more sense to me. More library, more studio production for Netflix to distribute. But finding a second distributor when they're already competing in the ads-based model, they're moving towards a cheaper distribution thing. They're already installed by default on most connected TVs.

I just think it's a way to expand overall engagement watch hours. They're already getting into ads. Why would they not want to have like more, basically like more watch hours to monetize?

Maybe, maybe, maybe. It seems like way in— Roku is in way better hands with Fox than Netflix. So it makes sense why the deal broke that way. Anyway, let's bring in our next guest, Hugo Frisk from Tenet Industries. He's the co-founder and CEO. Hugo, how are you doing?

What's going on? I'm doing great over here. Yeah.

Thank you so much for your time. Introduce yourself and the company. How are you doing?

Yeah, so I'm Hugo, I'm co-founder of Tenet Industries, and we are focusing on mass producibility and low cost for the defense system, basically commoditizing it. So I'm from the electronics manufacturing industry, and my co-founder, we're 3 co-founders, but one of them is from the automotive industry. So basically taking this like mass producibility, those concepts, and bringing them to the defense industry.

—How low cost do you want to go? I mean, we're all familiar with like the couple hundred dollar price point for a DJI product. Where do you want to sit?

Yeah, that's about it. It depends on the customer really. But yeah, we want to match, cheaper than China is our slogan.

Okay. And then how are you thinking about the actual product? We've been hearing a lot about the fiber optic controlled drones that don't need to deal with, wireless jamming or anything like that? Like, where is the demand for the next generation product? Or is it just what we know from a DJI quadrotor, what we saw there? Are there any specific demands for the defense context that make it a little bit different than what's already out there?

Yeah, there's the, the main factor is the range. Basically it's range and the lift power. How much can you lift? What's the payload weight? So it's all about increasing the range. And the main limiting factor for the range is oftentimes the radio, right? So what you want, that's why they're using like this fiber radios or these fiber optic cables because then you get longer range without getting jammed. But unfortunately, I think the fiber market, it's only relevant for this bubble in time because to increase the range, which is the main, like what customers want, they want, you can do either a better radio basically, you can develop better radios.

Yeah.

That's maybe the first step. And the next step is doing autonomy, right? If you have autonomy, then why do you need any contact at all?

Sure. Yeah, everything. How are you capable of, or do you think it's going to be possible to do on-device autonomy on a drone that size? 2 kilograms, that's not enough to run some serious GPU, but what is possible these days?

No, exactly.

You can put an NVIDIA Jetson on it, but the NVIDIA Jetson, it's like 5 times as expensive as the drone itself.

Sure.

So then it's not really a one-time use kind of deal. Yeah. So, but there are these embedded chips for AI. It's just you can't run an LLM model on it. You can do some visual recognition and maybe you can do some like prioritization of different targets. But the main factor here about the autonomy is not really the vision model. That's like a solved problem. This is possible. The main problem there is navigation. How do you get to the near vicinity to your target? How do you arrive in, like navigating for 20 kilometers without the GPS, because you can't use a GPS on the frontline. It's not possible. It's jammed out. It's super easy to jam out GPS and to spoof it. They will say that you're in China or something while you're in Ukraine or you're in Sweden or wherever. So that's the main problem. How do you navigate without the GPS? Because the last mile, which is basically targeting, that's a solved problem. That was solved in the '60s with missiles. I don't get the companies that are pitching that.

What is your business model going to look like? Or what does it look like today? You're trying to commoditize the category, push pricing down as much as possible, but you know, what are your margins going to look like and how do you expect to structure deals with different buyers?

So right now it's kind of this pipeline. How do you scale a defense company? Because it's not really possible to get this, this as a new startup, as deals straight to the state. At least not where we're looking in Europe. But so what you want to do is you start with the private companies, you sell to them. So we're selling to these counter-US companies. This month we went from 5 orders to 350 orders. And then you start selling to this subprime, it's called.

Yeah.

Like basically you're selling to a company that's selling directly to the government. And those are really interesting because they have already the channels to sell to these governments. And then once you have established like your manufacturing line and your capability and people trust you, then you can sell directly to the governments.

Chat asks, how does, how does their drone survive high-power microwave machines like Leonidas? Is the answer that it doesn't, but you can produce at such scale that— you can kind of—

Or there just aren't high-power microwave machines rolled out everywhere. But what is your take on microwave as a counter-UAS force right now?

I think microwave is— like, we've tested with these people having shotguns and shooting down our drones with shotguns, like, radar-controlled shotguns, basically. And it's a short-range system. It only reaches— that system only reaches 100 meters. I don't know about this microwave, how long is the reach at. There, but I would guess it's pretty small. So then you need a lot of these systems and people don't have that. They don't have these systems every 100 meters.

Yeah, yeah, yeah. Not every military installation or unit is going to have every possible counter-UAS. So it's sort of a game of rock-paper-scissors on the battlefield these days.

Makes sense.

And then the other thing is, like you said, like, just send more.

Yeah, yeah.

That's what I was saying. It's like you have, you know, your 5 exquisite systems, well, we're gonna, you know, outproduce.

Yeah. Is everything hand-built right now? Are you already working on automation? I imagine that low-cost manufacturability means more on supply chain and design, but what does the actual rollout look like over time?

Yeah, so when we started this, we wanted to produce with robots, still do, But basically, our background is this manufacturing background. So we're really good at designing for manufacturing, designing it so it's really easy to assemble. So we designed it. So how would it be easy for a robot to build this? Well, then it needs a few parts, and it needs a few screws, and no soldering, and it needs to be assembled all from one side. So that was the starting. And then it turns out once you do that, it's very, very easy to assemble. So it takes 2 minutes for a human to assemble it. Wow. So then why do you need a robot?

Good point.

Well, your batchmate will have to make the pitch for you.

How's investor interest so far? You've been busy the last couple weeks, or are you starting a process now?

Yeah, yeah, super busy. It's actually my co-founder Emil who's doing that, so he's always on call, and I'm doing customer demos and stuff. Yeah.

Very cool. Well, congratulations.

Great to meet you, Hugo.

Thank you so much for taking the time to come on the show.

Congrats on all the progress.

We'll talk to you soon.

Yeah, no problem.

Cheers. Goodbye.

Ryan Peterson says, with yesterday's 20% SpaceX pop, Elon made more money than Warren Buffett made in his entire career.

These headlines are going to get crazy because I mean, I see some of them getting community noted, but it's like a single day will move more than like all of Bill Gates' current net worth, that type of thing. Those headlines are gonna pop off consistently. The crazy one is like, —there's going to be down days. Like, there's going to be just random—

Elon lost more money today than any person in history can buy.

He lost more money than Brazil makes in a trillion years, you know? And because, like, whenever the big numbers get contextualized, it's always very entertaining. It was up another 14% after hours, though. But the numbers are staggering when you're in the $1 trillion $100 club.

JB says, is this everyone's first IPO? It's silly now as it approaches Amazon valuation. Well, we passed that, but the float is low until the lockup of nearly every retail investor on earth wants to be involved. You're gonna get stupid moves. Then the float opens up and all the retail people are stuck for years.

What does that mean?

Just say you haven't seen the Mass Driver demo, buddy.

Or the next data center. I mean, that's the really interesting thing thing with Cursor, there's all this debate over like they have a deal with Anthropic, they have a deal with Google. Cursor obviously wants to compute, but talking to Gavin Baker, it sounds like there might be a lot more terrestrial compute coming online in the very short term. And that is valuable. They're monetizing this very effectively. And so you could see a short-term revenue ramp just driven from sort of the boring NeoCloud stuff that monetizes really well. And then that provides, you know, it's like the Model 3. It's going to be the economic engine that provides the capital for data centers in space, mass driver on the moon, all that stuff needs fuel for the fire.

Anyway. Ad Ludlow has some data. SpaceX, the current approximate price to sales is 150x. Amazon is 3.6, Microsoft 9.2.

See, people read this as a bearish SpaceX take, but imagine if if Amazon started trading at SpaceX's price to sales?

Yeah.

It'd probably be like a $100 trillion company. Anyway, our next guest might be building the next $100 trillion company. We have Payton Case from Dispatch here, building reentry vehicles for returning space-manufactured payloads in semiconductors, biotech, and pharma. Welcome to the show, Payton. How you doing? Oh wait, sorry. Do I have the wrong person?

Wrong.

I think they mixed up the names.

Oh, we switched around. Efrain Torres. Yes. Thank you. Please introduce yourself for us so we get it correct.

Yeah. So, hi everyone. My name is Dr. Frank Torres. We're from Adiolante, building whole body mobile MRIs for cancer screening.

Amazing. There we go. Are there any downsides to constantly getting MRIs? No.

So MRI is non-cancer causing radiation. Okay. CT and X-ray, there's limitations. Got it. But MRI, I mean, I've scanned myself thousands of times.

Okay. So—

Are you the most scanned person in history? No, my professor takes that one. He's—

He likes to tout he's the most scanned and published brain in the history of mankind.

5 times a day or something.

Yeah, that's how you get it, yeah.

How mobile are we talking? Are we talking mobile like it can be in a truck that comes to the town and you go like getting your body fat measured in a water tank? Or are we talking like Fitbit, I clip it to my waistband and I'm constantly getting MRI'd?

Yeah, no, we're talking trailer. So pulled by like a Ford 350, shows up outside of a clinic.

Let's give it up. I like the Ford 350. There you go, right? We actually calculated it just for that. Yeah, okay.

And this whole body screen, $250, and there you go.

$250, okay, okay. So what, I'm getting a little feedback right now, can we deal with that? Thank you. So, yeah, sorry.

What does a normal MRI cost?

Yeah, I mean, Prenuvo, if you look at their pricing, they're $2,500, and it can go up to $3,500, so we're around 10 times cheaper than everything on the market.

And what is, —driving that?

Yeah, so there's two things. The first thing is our technology. Like, our system is 80% lighter, consumes 60% less power. It's actually 8 times quieter too. And all of this lets us have the operational gains. So we don't sell the systems, we sell scans. So it makes our internal operation costs really low.

Interesting.

And the shelf life of these systems are 10 to 12 years. So we can charge $250 a scan, and actually our gross margin actually ends up being 55% because of how long these systems last.

Do you have to go through medical device approval with the FDA?

Yeah, no, we're going through medical device approval next year as a Class II 510(k). 510(k). It's a fairly straightforward path because of the fact that there's a lot of regulatory precedent.

Yeah.

Where there's regulatory risk arises when you're like the first MRI, first therapeutic, and things like that.

Well then what about patents?

Okay, so what's the backstory on the company and the IP? Did you cook this up with your professor? Is he involved with the business? What's the history?

Yeah, no, not the professor. He's not involved. So me and my co-founder, we've known each other 10 years, went to grad school together, specifically to spin out a startup to disrupt the MRI industry, if you think about it. And so we developed an IP in grad school, got that patent issued. Adelante has exclusive rights to it. And yeah, so it's been cooking for a good bit here. But MRI is a hard problem to solve, and that's why it's taken us But yeah, doing well.

Very cool. So you're going through FDA approval. Can you actually sell the product in some advanced form yet, or is it just like demonstration for medical, for like research purposes at this point?

Yeah, so I love this question because it gets to one of the creativity of our company. We are deploying this year, but it's with traditional MRIs.

Oh.

The traditional MRIs, we're gonna put them in semi-trucks and it's all FDA cleared.

Okay.

We can go to our customers. We have 11 LOIs already, $19.75 million. And start building that distribution channel now.

Yeah.

And over the next year, right, we're going to get 5 to 10 of these trailers out there, all breaking even. But then come Q1 2028, when our product is cleared, you just switch it and it's like a lever to profitability.

That's amazing. Wow. Congratulations.

You're good.

Thank you. How's the fundraising been going?

It's been going well. We have— we only have a small amount of allocation left of our non-LEADS. Having a lot of exciting conversations with potential leads.

Are you more, are you seeing more interest from investors who have invested in health tech, medical tech, FDA-approved devices, that crowd? Because, or are there tech investors who are sort of exhausted with the AI stuff and want to broaden their horizons?

Yeah, honestly, we're getting a lot of interest from deep tech, generalists, and just tech. Because MRI is very well known in this space. You have Prenuvo. Everyone has a story of someone that didn't get an MRI in time, whether it be from like a sports injury to something more severe, like the cancer wasn't caught in time. And so we've had interest from deep tech, tech investors, generalists, health tech as well.

Well, congratulations.

Where's the name from? I got to know.

Yeah, so all credit goes to my wife. So Adi Alante stands for a couple of things. Our scientific approaches are known as radio frequency adiabatic pulses. And my parents' saying is "sigue pa'lante," which in Spanish is "keep going forward," also tattooed on my forearm here.

There we go.

And so "adielante" is very close to "adelante," which means "go forward" in Spanish. And it kind of goes that no matter what happens to us, we're just going to keep on making progress every single day.

Very cool. Thank you so much for coming on the show.

Logo chest piece.

No, no, no, this is wrapping it really nice. There you go, yeah. Have a great rest of your demo day. We'll talk to you soon. Yeah, have a good one.

Bye, guys.

Up next, we have a good buddy of mine, Russell Smith from Nine Mothers. He's back in YC. I went through YC with him in summer of 2012, 14 years ago. Overnight success.

Overnight success.

There we go. But I'm excited to catch up with Russell Smith, introduce him to everyone.

Tyler West. Was what, 1 or 2?

He was probably 7 years old or something.

Just a boy.

8 years old, yeah. But he's working on AI mission systems for defense. Can we get Tyler in here for a little bit? Focus on counter-drone protection. Yeah, yeah. In between the next guest, let's slot in some Tyler for sure. Anyway, we have Russ Smith from Nine Mothers in the TVPN UltraDome in at YC Demo Day. How you doing, Russ? Hey, good to be here. Good to see you. Long time. Been way too long. Thank you so much for taking the time. I'm glad we can make this happen. For those who don't know you, introduce yourself. Give us a little bit of the YC history, the entrepreneurial backstory, how long you've been an entrepreneur, and then take us through the current company.

Yeah, I mean, I was an entrepreneur before I did YC, so like in the UK, but got into YC in the same batch as you. That's how we met in summer '12. The batch that basically broke YC at the time and made them rechange it.

70 companies, looks— Wait, how did I—

So, YC had been like 30. Yeah, yeah, you can tell it.

Yeah, it scaled and then they decided to change how it worked. And it's the genesis of how they do groups now, right? It was basically a free-for-all at the time where the loudest companies or the most like intense ones would get the most— well, not deliberately the most attention, but would—

Yeah, it's sort of natural.

Yeah, get the most love, right?

It's funny because it was the YC batch that broke YC. Everyone said, "Oh, YC's over it." It's gotten too big. And then it was like Coinbase, Airbnb, or Coinbase, Instacart, Zapier, a couple other companies that became huge.

Clever.

Clever, yeah.

Benchling. Like a bunch of—

There were a bunch of great companies that came out.

A bunch of decacorns and unicorns in that batch. Yeah, it was good. And more silent as well, right? As in, I remember going to your Tenderloin office and carrying bags of your early product out in little bags.

$1,500 a month for 3 people to live in San Francisco.

I remember that. You guys, didn't you move in there when you had like $18 grand or something?

Yeah, I think we had like $20 grand left in the bank. And you were like, "Good, this will last us like 18 months." Yeah, yeah, yeah. We paid our rent a year in advance, owned our laptops. We just had to pay internet and food and that was it.

And then that's where Soylent came from, right?

Yeah, yeah.

It's like, just eat that, it's cheaper.

Anyway, we're not here to reminisce about the old times. Tell us about Nine Mothers.

Yeah, so we make AI mission systems for the DOD and our first product is counter-drone. And we make a very small robot. So it's 35 pounds, we sell it for about $150K and it's capable of defeating multiple fast-moving drones day or night. Kinetically? Kinetically defeat. So yeah, it's basically a gun on a robot. And then we build all of the models for day, night, build acoustic sensors, build models for that, and then basically capable of shooting down small, fast targets.

Interesting.

Can we pull up the video? Because I have no idea what this robot looks like.

Yeah, let's pull up the video.

I have it.

Oh yeah, yeah. We'll have the team pull up the video. I'm curious about What about the decision around acoustic models versus video models? There's so much energy around—

We do all of it.

You do all of it?

And so, the key here is that no sensor is perfect, right? And so, multiple sensors gives you more chance at finding something. And then, for instance, acoustics is bad on some of the projects we're doing that are around turbines, right? On Chinooks or other vehicles because it gets drowned out. —then radar is bad in some environments and vision is bad in some. And so, the fusion, the ability to fuse all that together into coherent picture and also adapt to new sensors means that we can stop more things, right? Yeah. And the key here is that this is kind of like the same problem that you saw in Iraq with— or Afghanistan with IEDs. These are just now flying IEDs. And all the demos you've seen existingly almost all of slow-moving targets, so like sub-10 meters a second, sub-10 miles an hour in some cases, drones people are struggling to shoot down. And that's just not reality, right? As in, we've been shooting and demoing, as in we shoot faster internally, but demoing 65-mile-an-hour small drones repeatedly. Like, and that's way closer to reality, if that makes sense.

Where does the name come from?

Dude, it's It's Norse mythology. So we're nerds and then our product names are all around the same mythology.

Okay, I like it.

And so naming's hard, but yeah, that's where it came from.

That's the story.

That's good. What does it actually shoot? Is it shooting like 5.56, like some commodity round?

We can adapt to anything, as in we can do 5.56, but the thing that works the best is 12-gauge. And so we make— our own— we use a gun off the shelf at the moment. We're also developing our own belt-fed shotgun system, like as in the world's first belt-fed, and that will be first firing in the next 3 weeks. We also make ammo, right?

You make ammo?

Yeah, it's basically closer to match grade, which is like tighter tolerances and then slightly higher pressure. But owning everything, like the full stack, that means— it means we have better results. —for defense, right?

I mean, you're obviously a very experienced founder. Where's the company right now? Do you already have facilities set up, staff hired? Like, I imagine that you're pretty far along.

For YC, we're a little later on. So we've sold like $1.6 million of stuff to the DoD, as in direct sales of units, not not research and dev stuff, like actual sales, delivered units to DoD, and then we're expecting to sell over 100 units this year and 1,000 next year. Have multiple believable paths to both. But yeah, aim is to do over $100 mil of rev next year, and it's looking completely believable. Should hit $50 this year.

Super impressive. Question for you. How— let's say there's a front line and you set up a— you know, I imagine, you know, let's say the US military sets up a bunch of these drones are flying over, how do you manage, uh, friend— like, uh, like—

It's a great question.

Friendly fire.

Like, let's say a drone passes the line, there's actual troops back here, and you want to take out the drone, but you're effectively shooting rounds into the air.

Yeah.

How do you—

It's a great question. And it— the— the— it's a complicated answer. And it depends on the mode the system's in. We can ignore stuff that's flying away from us and only prioritize stuff that's coming towards us. We can also take signals off networks they have if they know which drones are theirs. Really, the common thing is that they don't actually have that kind of data. And so the operator can choose to not run it full automatic and then choose which targets. But mostly they will shoot them because of blue-on-blue risk. If it's not drones they are physically flying in the same group, right? It's— that's the problem, is, is it a friendly drone that's misidentified you or not? If it's on a network and we know it's not, has it still misidentified you? Uh, that's where you get into the problem of this at this kind of range, right?

Well, congratulations on the progress, really exciting growth. Great to catch up. Come back on our show and we'll talk more soon. Have a great one.

Yeah, see you. Great to catch up.

See you soon. Goodbye. Let me tell you about CrowdStrike. Your business is AI, their business is securing it. CrowdStrike secures AI and stops breaches. Our next guest is Payton Case from Dispatch. I accidentally introduced him a little bit too soon, but we got him sitting down in the YC Demo Day.

What's going on?

How you doing?

Yeah, it's good to be here. Good to see you guys. Good to see you too. Introduce yourself, introduce the company, tell us what you're building.

Yeah, so I'm Payton, I'm the founder of Dispatch Space. We build satellites for manufacturing products in space. And these are for the most advanced materials in the world that can only be made in microgravity. And we bring them back down to Earth.

What specifically are you building? Because the space economy has gotten so fractured at this point. There's, you know, multiple launch providers, there's satellite bus, providers. There's Impulse Space. Tom Mueller has an extra propulsion system that you can bolt on. Like, what is the key product that you're focused on for this early stage of the company?

Yeah, we build the reentry vehicles. So this is the satellite is in space, you've made your product, and now you need to get back down to Earth. You're flying at Mach 25, you're surrounded by a plasma that's 3,000 degrees, and we build the heat shields and satellites that can survive that environment.

Who is doing stuff in space? Like, I live in the world of Varda very closely.

Yeah, yeah.

It seems like—

Elephant in the room is that we are very familiar with—

Very close with DeLorean.

Because DeLorean's our friend.

And it seems like obviously they're going vertically integrated, building the reentry vehicle and also doing the contracts with biotech companies and pharmaceutical companies. But it does seem like the industry is expanding. So who are the other buyers that— aren't working with Varda that you have an opportunity to work with?

Yeah, the biggest players are semiconductors, pharmaceutical, and biotech. Varda is very vertical in that pharmaceutical application. We're the biggest bulls on the semiconductor space. We think that the regulatory environment makes it so that you can come to market a lot faster. And the applications of growing those gallium nitride and indium selenide crystals in space are, massive, and that's where we're bullish on it.

Massive, I'm down. Everything that touches semiconductors is massive. You say semiconductor, you're a trillion-dollar company, but timelines, the timelines, like it feels like we're a decade away from making a chip in space, making a chip on the moon. Like even the big SpaceX bulls are saying like, okay, actually doing the mass driver, that's maybe more than 10 years away. Let's focus on the short-term stuff.

And so maybe another question is like, what traction are you talking about this Demo Day? Yeah, yeah, yeah.

What are you looking at?

Yeah, so we have a pilot mission that we're flying with a paying customer to grow semiconductor crystals in space.

Whoa.

And we're not talking about doing like the lithography or assembly on iPhones in space. It's about, it's earlier in the supply chain. So chips come from wafers. Wafers actually come from these cylindrical crystals.

Oh.

And when you grow those in microgravity, you get up to 1,000 times fewer defects. So you grow those crystals in space, bring them back down to Earth, and then you cut them into wafers. And that is actually happening now on the ISS. And these companies are looking to scale. They just don't have the vehicles to do it.

Oh, very cool.

How did you make your first dollar?

The first dollar was the deposit on the pilot program.

No, no, no, in life, in life. I want the founder origin.

Oh yeah, it was probably working in a smoothie shop that I totally loved the smoothies of, wink wink. I was, you know, I made a few tips. That was about it.

You realized you weren't cut out for the smoothie business.

Gotta go to the semis.

So you were meant to go to the heavens.

Yeah, fabs in space are a little easier than getting tips at a smoothie shop for me.

That's amazing. What's the state of the space investors that have attended Demo Day? Are you seeing traction? How's the fundraise going?

Yeah, the fundraising's going great. Obviously, IPOs are very useful for us. So that's been a great indicator of where the entire market is going. We're getting close to closing out that round, which is super exciting for us. And like really that goal is getting back to work as quickly as possible and using that money to go build great things in space.

That's fantastic.

Dan in the chat said, "From smoothies to a smooth operator." I like that.

That's great. Well, thank you so much.

Great to meet you, Peyton. Congrats on all the progress.

Have a great one.

Thanks so much.

We'll talk to you soon. Cheers. Goodbye. Our next guest is Akshay from Madrone. Building cooling systems for data centers.

He is working on—

That are more power and water efficient. I'm assuming he's working on reducing water consumption in data centers so that almonds can have more water.

Oh yeah, yeah, yeah. This guy's an almond industry plant for sure. Anyway, let me tell you about Railway first. 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.

Whoo!

Thank you, Jordi. Let's bring in Akshay from Madrone. How are you doing? Welcome to the show. Thank you for taking the time.

What's up?

Hey guys, huge fans, so appreciate the opportunity to talk to you guys.

Fantastic. Great to have you on the show. Introduce yourself, introduce the company. I have tons of questions, but let's start with the basics.

Sounds good. So I'm building Modrone. We're building hyper-efficient cooling for data centers. So specifically, we've engineered a thermodynamic process that works really well in hot and dry climates, which is where most of the hyperscaling is happening right now.

Okay.

And yeah, it's, we have our demo that's running live at Demo Day today. So we're actually really excited to show people in person. But the big problem really is that data centers are limited today by power and not by chips or land. So cooling and power are two sides of the same coin. If you can save power on cooling, that's more power for your flops and that's where our real value unlock is. So people can install more GPUs given the same grid permit, which takes years to get. To give you a sense of the scale of the problem, last year in Texas, Semianalysis said that there were 150 gigawatts worth of load requests Texas grid on a good day, 60 gigawatts and only 1.5 gigawatts worth of those requests were actually approved by the local utilities. So it's a crazy scrambling time. Like Elon Musk was probably the first person to kind of come up with a method of putting engines on the back of trucks, rolling them onto data centers for power. You know, Boom Supersonic, whose ultimate goal is to be building supersonic jet planes, has had a slight pivot to selling supersonic jet engines and apparently they're crushing it.

Mm-hmm.

So it's a crazy time and it's the first time in a long time where a new company comes in could come into the market and build a thermal industrial company.

So what is the bottleneck for you? Is it figuring out where your system, what data centers your system can fit in? Is it actually just how you have the demand and you're trying to meet it? Like what does your supply chain look like? Like what's standing between you and let's say not this round right now, but the next one?

Yeah, it's a great question. So we actually scaled our 1-kilowatt prototype 100 times during the batch to 100-kilowatt prototype. Prototype. We're going to be deploying our 1-megawatt version very, very soon. The 100-kilowatt prototype that's actually running live at Demo Day right now is going to be running our first pilot in 2 months. So really, it's going to be between the 100-kilowatt and the 1-megawatt prototype. It's going to be figuring out how to elongate it and make it taller. So we've done the really hard work so far, but really it's just building a physical big version of it so that we've talked to hyperscalers. Their feedback is they just want a bigger version so they can— because they have such a huge demand, they're not really interested in 100 kilowatts. They're interested in 100— 1 megawatt.

[MUSIC] Okay, so 1 megawatt will be enough to get your first real orders, revenues with hyperscaler type customers.

Yeah, all the data center campuses will say, I'll take 10,000 please because I'm building 10 gigawatts. I mean, basically chain them together, right? But this is, I mean, we saw in the video, it looks like a shipping container and essentially the input output, the output is just cold water, it takes in water. So you are agnostic to the design of what happens happens in the data center, I imagine. You're not dependent on any particular chip or rack design.

Yeah.

But then what energy is actually going into your system?

Yes, exactly. It's a great question. So the energy is used to be the fans and the pumps. So actually circulating the fluids through the system. If I may brag about my co-founder a bit, we don't just design the physical box. He actually designed the thermodynamics, the mechanical structure, the electronics to power it all, and then also the software to control it. We do this all in-house. We're big Tesla fanboys. All our competitors are outsourcing every single level of this engineering out, and they're just integrating that and selling that as a product. So we've been able to get a lot of efficiency gains by just designing this all in-house with 2 people so far. We're fundraising and we're going to hire some more people, hire our friends in the Bay Area, and building the 1-megawatt one with our own hands.

Fantastic.

Amazing. And so there's already a lot of energy on these campuses. Resources that you can draw from. So whether it's natural gas powered, powered from the grid, powered from nuclear or solar, whatever's going on, you're drawing from that, but your goal is to just draw more efficiently and take less of the power. So that can probably just go into the chips, right?

Exactly, yeah. You get a lot more inference value out of redirecting that power to your flops.

Okay, and then in terms of how you're pitching yourself at Demo Day, are you, on the path to LOIs with hyperscalers? Are you working backwards from, are you doing business with NeoClouds? Like what's the walk, crawl, run to actually create the economic flywheel to raise money and then go build this thing?

Yeah, great question. So we've already started conversations with 2 hyperscalers. We're actually talking to a 3rd one this week after Demo Day, which is super excited about. Let's go. One of our investors actually, we closed the check today. They're actually building $20 billion worth of data centers in Texas. So that's been really nice. But the really first—

That's good news.

Yeah, fantastic. The first thing for us is really going to be focusing on that pilot, just demonstrating that we can plug into an AI data center at scale, do it reliably, reliably, and at scale with our investor that we just partnered with today.

Yeah. And then what type of efficiency number actually draws the attention of a potential buyer? Are we— is 1% enough? Is it 10%? Is it 20%? 50%? Like what's reasonable? 'Cause I imagine we come in, we're 99% more efficient, everyone's like, "Yeah, that's not real." But is 1%, are we doing basis points here? Like how much of an impact do you need to have to actually move the needle? 'Cause some of these projects are so big, their bill for electricity might be, you know, hundreds of millions of dollars.

Yeah, exactly. Like guys, it's so crazy. My competitors are 100-year-old companies that have been designing the same thing for decades. There's this thing called the mechanical chiller. Yeah. It's literally the same thing as your refrigerator at home and it costs $500 million per gigawatt.

Wow.

So people are really desperate to get away from these chillers and look for different types of cooling because that's actually eating up your grid permit. So that's a thing that actually costs 30% of your grid permit and we can do it for cheaper and we can actually have better OPEX as well. So really any percentage is okay. I think that like you can't quote like 0.1% gain, but like, you know, people are thrilled if you have a 10% efficiency gain.

And then also we're just in a supply crunch. So even if you just said, hey, we have the exact same thing, but it actually will ship in the next couple months, a lot of people might jump at that. So that's the benefit of being in model mode.

What were you doing before this?

Yeah, so I was actually scaling manufacturing at QuantumScape. So I was doing computer vision, working directly under the CTO, Tim Holm, founder CTO, took it all the way from inception to IPO. And I also did grad school at Berkeley studying material science. There's a material choice to this company we didn't get to talk about today, but we're, we're doing something cool.

Very cool.

Very cool.

Well, thank you so much.

I'll come back on after you raise, and it was great to meet you.

Yeah, fantastic.

Awesome. Thanks, guys.

We'll talk to you soon. We're gonna bring on some YC partners in about 4 minutes. Stay tuned. In the meantime, we can go back to the timeline. Back to news.

Let's talk about specs.

Talk about specs. This is from Evans Eagle. The German Eagle. Yes, and the German Eagle reported.

Snap specs are official. $2,195 all-in-one AR glasses. That Evan Spiegel has dubbed the next computer.

$2,200. That's almost Apple Vision Pro numbers. That's expensive. Uh, it's gonna be a lift. I feel like it's a lot. It, it seems, it seems like a lot of money. Um, it's got to be—

Apple Vision Pro starts at $3,499, so a bit of a But this is a product that seemingly is trying to compete in the realm of like a, it's a mobile device. It's naturally a mobile device. Unlike the Apple Vision Pro, which obviously is some viral images on launch of people walking around with it.

I'm just thinking about like, there are a lot of Apple fanboys who buy every— Get this.

What? Get this guy on right now.

What?

Pull him up.

Hey, what do you say? Are you buying The Snap Specs, $2,200. Are you spending your paycheck on that? I mean, I think they actually do look really cool.

I don't know, like I was looking at some of the product demos earlier. Some like the game features look really cool.

There's like ping pong.

Yeah. $2.2K is like a little pricey personally. But if you can watch Lawrence of Arabia from start to finish.

If we bought it, if we traded you your phone for a pair of these for a week? Would you demo them? Would you demo them for a week? No phone.

No phone.

Would you commit to it? Can you do like texting on it?

Can you call?

You don't need it. You can go without texting for a week.

You have Lawrence of Arabia. You don't need a phone.

That's true.

I can watch Lawrence of Arabia like, you know, 5 times a week.

What's the battery life? What is it? Snap specs battery life. Specs battery life. I gotta know.

So what happened? Wasn't there some conversation that Snap that SPACs might spin out.

Up to 4 hours! That's Lords of Arabia right there, with a little intermission.

If I remember correctly, there was some rumors that SPACs would be spun out. I remember at least one article. That has not happened.

I don't think so.

And so, the stock is down 7% today.

I don't know. The trick is that But you have Apple fanboys who, of, you know, they have a lot of Apple fans, but some of them are wealthy. Some of them buy every product. They buy a new phone, a new iPhone every year. They buy the top-of-the-line MacBook. They have the Mac Studio and the Mac Mini just for fun. And like, that's a whole class of consumer for Apple. And so when they come in with something that's a little crazy, like a $10,000 gold Apple Watch, like they'll sell a couple of them. When they come in with a $3,000 VR headset, like a couple people will just be like, "Yeah, I'll give it a try." When you're talking about a new company entering hardware, Meta, I think, did a better job coming in with like, "Yeah, it's just a pair of sunglasses. You need a pair of sunglasses anywhere, anyway." We put a camera in it. We put a camera in it. It's $100 for the version that you know and love, the Ray-Ban Wayfarers that don't have a camera in them. Ours are add a couple hundred extra bucks. It's still something you could give as a gift.

And Meta can afford to lose money on every single device effectively forever.

Totally, totally, yeah. And so it's a lot easier to get into that like Meta ecosystem, just saying like, yeah, throw a camera on my Ray-Bans, I'll give it a try, maybe I'll churn. But if it's collecting dust in the cabinet or in the sock drawer, you're a lot less like, ah, I really got burned. And like the Apple fanboys You know, a lot of them took them back, but they're like, yeah, that was still like a cool experience, except me. Because I gotta watch.

Well, Tyler, once you're back in town—

Wait, what was that? Lord of the Rings Extended Cut. I think that's even longer than Lord of the Rings. You can't watch the whole thing though.

Well, let's do this.

Once you're back in town, let's pick up a pair. Tyler can live with them. We won't say a week, we'll say 48 hours.

Exclusively.

Exclusive.

Do everything.

We take the phone.

I think you need the phone to— to do anything. I think a lot of the compute happens— 48 hours, I think, is actually not very hard. That's just a digital detox.

Okay, then you're down. One weekend, you're down?

I could do a week. I could do a week.

That's like 10 showings of Lawrence of Arabia.

I'm not asking you to do a week. If you want to do a week, we can do it. Okay, he's doing it.

I'm here in 4 weeks. I'm here in a full month now.

4 weeks. All right, it was great to see you, Tyler. We miss you.

Great to see you.

I'll see you.

Old Troom Troom's not the same without you.

Yeah, it really is. John and I were We were kind of messing around.

Kind of quiet in here today.

And we realized when Tyler's not here, there's nobody super close by to laugh at our bad jokes. Yeah.

It's a bit rough. Spiegel called the specs both very, very wearable and highly capable, which he said gives Snap an opportunity in a market that's focused on either very large and clunky headsets that are super capable or very lightweight glasses that really don't do much. So it is interesting. I was reading the coverage of— there's some videos here in UploadVR, and it shows sort of the process of this. The HoloLens 1 from Microsoft, 2016, was 580 grams. Snapbacks are 132 grams, so they are light. Now, the Meta Ray-Ban display is 70 grams, so about half as heavy. Yeah. So these are heavier, but they're nowhere as heavy as a HoloLens or a real VR headset. And it checks a lot of the boxes on field of view. And we'll see, we'll see what the developer ecosystem's like. I hope someone comes up with some interesting thing. I hope that there's a YC company that builds on top of this exclusively and has some sort of breakthrough user interface experience, some killer use case that comes from the community.

Yeah, gotta wait to see how many of these—

Not possible. —Yes, that will be, that will be very—

You're gonna need, I mean, even with a million sold, it's not a very big user base.

It's a lot of money. Let me tell you about Consul. Consul builds AI agents that automate 70% of IT, HR, and finance support, giving employees instant resolution for access requests and password resets. And without further ado, let's bring in Diana Hu from YC. She's a managing partner. Diana, welcome to the show. How are you doing?

Good. Thanks for having us.

So much for taking the time.

How is today? Yeah, how's Demo Day going?

The energy and vibes are immaculate.

Mm-hmm. What is it, how does it compare to your YC experience, your entrepreneurial journey? Tell us a little bit about that and then take us through how you're talking to today's entrepreneurs about what's changed, what's the same.

It's kind of fun that you were just talking about Snap because my company was building augmented reality the SDK for game devs back in the era of HoloLens.

Yeah.

My company went through the batch back in summer '17. Back then, it was different. It's way smaller than what it is now, and AR still taking time to get to the headset. When we went through it, Demo Day was back in the Computer History Museum. —that came out to be. And now we got our campus here in San Francisco and have way more investors, and companies are raising a lot of amount that probably was more Series A when I was running my company.

What was the mood like around platform risk, building on top of something else? Obviously, a lot of the augmented reality companies Niantic built on top of the iPhone, on top of smartphones. And then now we see AR sort of trying to break in through new devices, specifically spectacles, headsets, wearables. But was that a risk factor that came up in pitching VCs? Or was there sort of like, "OK, there's enough of an ecosystem here. There's enough of a—" an enterprise play that you'll be able to be a winner no matter if there's one platform that breaks out?

I think it's a very good question. I think it's the same question right now that a lot of the AI companies are wondering whether they're on the path of the roadmap for the big labs.

Yeah.

We had the same issue when one fun fact, maybe not so fun, but On the first day of the batch when we went through it, we basically had built the same platform that Apple ARKit released.

Yeah.

Exactly same. It was the same SDK.

Oh no.

And on that first day of the batch, we actually freaked out because you have this giant company that has infinite amount of money that could just crush you. And I think what that forced us to do was was to really accelerate a lot of our roadmap because we had thought of building basically this SDK that would enable anyone to build code once and run on any hardware. So we were the first SDK that could enable running it across, you, you build the code once and it would ship on Android and iOS and eventually also got it to headset. Then later on, our company had an exit and got acquired by Niantic, the makers of Pokémon Go. Mm-hmm. Was the biggest user of AR back then. And then I ended up running a lot of the AR and engineering teams for Niantic.

We had Andrew Lee from Tasklit on first, and I really appreciated how he just straight up said, he's like, yeah, we are in the path of Anthropic and OpenAI. Oh yeah, we're competing. And we are competing. We're duking it out. Sort of accepting that, and workflow automation, what they're doing, such a big category, can obviously with great execution build a big company even despite of that. What are some of the key themes for the batch? How does this batch compare to the last batch? What kind of trends are you seeing overall?

I think this batch is following a similar trend to the Winter '26 batch. Where things that have been happening, a lot of these companies are the first one that are basically riding the wave with agent decoding working. It is, it has become the norm where company, well, the norm has become more common that companies can go to zero to seven figures in revenue within just three months, which when I did the batch, that would've been impossible. I don't think any company companies did that. The best companies back then would grow, let's say, 10% week on week, which is what, let's say, Airbnb did back then. And that would get them to a couple hundred thousand in ARR, which is a very good, very, very, very impressive accomplishment back then. But now companies get to 7 figures because the companies are able to build a more mature product a lot quicker with, with agented coding. Mm-hmm. If they the right user and customers and sales and nail on that, people can really speed through this right now.

How often do you find yourself talking to a company in office hours that you think shouldn't be optimizing for that? Because there's a lot of companies that we've talked to today, like Madrone, for example, like very important sort of product category, clearly massive TAM, and they should go as fast as possible. But if they just optimize for revenue traction right away, it would take them on the wrong path, I imagine.

Oh, absolutely. So this is where we give very custom advice depending on the type of company. If you're building, let's say, core infrastructure or defense type of applications, It's more important that you deploy deeply into few customers and doesn't matter if the revenue is small, but it has a lot of opportunity for growth. And it, it really depends on the journey. So this is not advice for all the companies, for, for some of them.

The YC has gone through waves of like consumer boom in the early days with Airbnb, Airbnb, and a lot of consumer companies, and then sort of swung to business-to-business products and companies. And there's been Demo Days that we've been to where it's a lot of stuff that's deeper in the token path, which is a great place to be, enabling agentic workflows deeper in the stack. There's a lot of hard tech this time. But I'm wondering how you're viewing the opportunity opportunity in consumer, in gaming. We're just seeing so many Vibe-coded games that are remarkable demos, and it feels like with a YC team on an actual deadline to get to real functionality, real adoption, revenue traction, uh, the tools are there now where previously to make something that looked anything like a breakout game, you'd see these companies and you'd and you'd hear, "Oh, well, you know, Epic Games was grinding in the dark for 5 years building their engine before they released a game," or, you know, so many companies, Roblox, it took a long time. Now it feels like you can move faster, and that might make it more— the end state might be that all of this turns into, you know, there's no fundraising at all and it's all just indie devs, but it does feel like there's an opportunity here. But how are you seeing consumer either in gaming or just broadly develop over the next couple of years at YC?

I think it's still very early. We haven't seen these companies break out yet.

Yeah.

And I mean, this whole era of AI right now, which is one of the most fun eras in tech right now.

Yeah.

There's still so many patterns that we're figuring out. And with regard to consumers, I think there's gonna be a lot of big category winners. That we don't know what the shape of them could be. Mm-hmm. It's sort of like trying to predict the Airbnb or DoorDash back in the 2010s would be very hard. And with regards to gaming, having worked in gaming myself and know a lot of these AAA studios that you mentioned that take a long time to get game out there because they build the engine and there's just so much technical complexity. A lot of that, yes, the barrier of that is entry is lower. But I think the thing that's still in short supply is the ability to encode fun. The thing why you could build lots of games today, which I've tried and vibecoded some games, but it's hard to build actually game loops that people keep coming back and have fun. Those are new patterns that we haven't discovered. I mean, you could imagine now in the era where a lot of games could be in an agentic loop and based on a lot of the metrics of the usage, they could self-improve and it could be more fun. But I don't think people figure out how to build those because you have to be able to measure fun, which I'm not sure if there's an easy way to do that. It really depends game per game.

Yeah, yeah.

Yeah, that's a good point. That makes a lot of sense.

Anyway, thank you so much for taking the time to come chat with us. Have a great rest of the show.

Yeah, great to meet you and great work this batch. There's a lot of fun companies.

Yeah, we'll talk to you soon.

All right, guys.

Have a good one. Good to see you. Cheers.

Goodbye.

Well, Manitas is getting himself in trouble for—

Again?

—debating the world's population. He says, "Population is max 500 million global. Earth is max 50 million." 15,000 years old. People are asking if it's bait. He's going back and forth with a bunch of people. He's pointing out that there are some economic incentives to certain countries to misreport population numbers if they're getting economic incentives or distributions based on that. He's having fun on the timeline. You can go dig into his posts and make a call for yourself. Anyway— Yeah. Okay, over in China, one of the most populous countries in the world, allegedly, the final boss of ADHD has been spotted. The guy is simultaneously watching TikTok, chatting in a messenger, and playing a game. This is what a foldable smartphone is for. There's pushback against smartphones now. Imagine what foldable smartphones will do. Is it gonna be even worse? Who knows? This is an absolutely crazy setup to be rocking. And is he pausing? Is this a single-player game that he pauses, or?

Yeah, it kind of seems like he's LARPing.

Yeah, this seems performative, right?

This is a LARP.

This is a LARP, yeah.

This is a LARP.

I don't think this is real. I got in trouble for my game knowledge. I apparently used min-maxing improperly, although there was some debate over whether or not min-maxing has transformed into the definition that I used, whether I was using a more modern interpretation of that term. But anyway, you can go and dig into Citrini's post and make your own justification on where you sit on token maxing, token minning, token min-maxing. The clear point is that you've gotta focus on ROI like any other business process.

Andrew Gao sharing some data. Andrew's over at Cognition. He says, this isn't public, but Stanford CS degrees dropped 42% year over year, Berkeley down 61%. All of the propaganda, like you don't need to learn to code anymore, seems to be working.

I mean, it's gotta dramatically change the experience and like the fun of being, like part of the fun of taking a computer science course is doing an exercise and working through the code and like solving the puzzle. That is the code challenge. And when you can just one-shot that with any frontier model, it gets a lot less fun. And so you have to imagine that people moved over to other more amorphous, more rewarding disciplines. But it does seem silly because I'm sure that if you, if you go really deep in a CS degree and you're AI-enabled as well, you can both find a job and also have a really, really interesting and rewarding experience. But certainly a reaction to the fact that the existing path of just like someone tells me exactly what to implement and then I go and implement that and I make 6 figures forever is less and less clear. And so people are reacting to that by going to other places. I wanna see the data on where these students went. What are they studying? Yeah.— if not CS, did they bleed into everything else? Because sometimes you read these and it's like, oh, they're not studying computer science anymore, they're studying computer engineering now. And it's like, yeah, that's kind of the same thing. Like, you saw that, like, computer programming declined but computer science jobs increased or something like that?

Yeah, they're studying—

Computer engineering. They're studying AI, ML.

Yeah, yeah, yeah. I mean, a lot of the AI track has always been in symbolic systems anyway, not CS, at least at Stanford. That's what a lot of the early Facebook employees and a lot of those folks studied. There's a lot of other folks that study physics or math or all sorts of things. And it's gotta be more fun to study a really hard topic like physics or math because you have an AI tutor and you can use AI to close that gap, to bridge that gap. But we should ask Harsh Togar from YC. Yes. Ready to chat with us. We can ask him about what you should major in if you wanna build the next great company. What do you think, Harsh? Did you study computer science? What was your major?

I didn't actually as an undergrad. I started in law school and then I dropped out and then I taught myself to program.

A lawyer becoming successful. Anything is possible.

Yeah, it's true.

It was a bad start, but it ended up being good. It's remarkable. Yeah, no, no, obviously, It's a fantastic background. It speaks to the diversity of backgrounds that lead people to success in Silicon Valley. What do you make of this decline in CS degrees? What are you seeing in the YC founders that join the latest batches? Is there, are you experiencing more diversity of backgrounds? It feels like YC's always been pulling from all over the place. The best case in point is Airbnb. It's a bunch of design students. And that was not a feeder school for, it was not a unicorn factory, RISD, and yet we got Airbnb out of it. So what's going on at YC in terms of educational background these days?

It's good, you know, I was actually this weekend, I was with a group of college students that we were meeting, and hopefully they'll do YC one day. And this was definitely something they said, is that they are seeing their smart friends enroll in computer science less. People want to do more physics and math, and first principle stuff. So that definitely, I think that's a leading indicator. So I would definitely expect over the next few years, we might see more of the Spark founders come in with like a math or some sort of like thinking, STEM-y background that's not pure CS. And then like, I don't know, use the coding models to actually write the code.

Yeah, yeah, it doesn't, there's one read on this where it's like, oh, no one's going into tech. And I think it's like, no, people are gonna be like even sharper about about using these tools and even more, you know, ground truth in what matters, in what's not changing, in the math and physics stuff. Anyway, other trends that you're seeing?

Yeah, yeah, I wanted to get into like the psyche of this batch. If you zoom out, so many companies are having like this sort of like often, you know, if they're a later stage company, midlife crisis, if they're a younger startup that's kind of in the path of the lab, they're wondering, it feels like even the last— you know, few weeks, like the narrative is kind of flipped and we're seeing like a lot of the application layer companies say like, hey, we have an opportunity to sort of orchestrate a variety of models and maybe get efficiency for companies that were token maxing. So what is the psyche of the current batch? Where are they finding opportunity? I'm sure, you know, you had a few office hours where founders were saying like, is it over? Should I just, you know, pack it up and— join a lab. But, and of course, the YC way would be to say like, no, there's always going to be opportunity for, you know, smart, focused people. But take us through it.

Yeah, I mean, it definitely ebbs and flows. I would say when Claude Code first launched earlier this year, I feel like it really did flow towards the, oh wow, like the labs are going to take way more of the value and like, are they just going to own everything? And I think that was a little bit in the, in the psyche. I feel like now it's flowed back towards, you know, you don't— you want to try and have a little bit of thought around are you going to be in the path of labs or not? But mostly, I just think the founders here are doing their thing. And they're not— they're not currently like worried about that as much. So much more. And I think like largely they're trying to figure out what are kind of maybe the boring but valuable things that the labs are just not going to focus in on. And I think there you see a lot of— it's funny, it's like we used to talk about like making stuff that people want. Now I feel like it's a lot of making things that agents want. And so especially at like the infrastructure level, it's like how do you set up sandboxes for agents that go into the nitty-gritty detail of giving them all the tooling that they need to use to actually perform tasks and actually to do things. And it's the kind of stuff that the labs themselves are just unlikely to go into depth on.

Yeah, it's funny that somewhat It's like somewhat a new framing. Think about what the big companies aren't gonna do is too off the beaten path for them. But if you go back, I'm like, well, the hotel industry wasn't thinking about Airbnb and the big banks weren't thinking about Bitcoin and you get Coinbase. And so there's something there that's like always been true and is just sort of resurfacing and is actually maybe a ground truth that you need to pull back to constantly. But it is potentially more relevant than ever. Has the Gavin Baker meme of being in the token path taken hold this batch? This idea that you wanna be deeper in the bottleneck, that if you're not in the downstream path of the labs, the safest place might be upstream, deeper in the supply chain. We talked to a founder who's working on Cooling for data centers, that's clearly something that's very aligned with the broad trend, but what's happening there in terms of token path thought?

I don't, I don't know, at least I don't think that has trickled down to like the founders starting these companies and figuring out what ideas to work on. I do think some of that framework fits, like you're certainly seeing things further into like the physical world, like actually, you know, building physical things. But I think that's actually more to do being inspired by Elon and Palmer Luckey at Anduril on the founder side that people want to work on like physical, like working atoms. So we've got a team in this batch building like a nuclear reactor.

Sure.

Like that, that I think is just inspired by, hey, like we want to build real things.

Yeah.

And then I think on the other side of the marketplace, investors typically really didn't want to invest in hardware companies. So we used to see this, I always used to brace the hardware or the hard tech companies, hey, you're going to have to like be ready for it because no one's going to want to invest in you. You're going to have to grind it out. It might be years before you raise the money that you need. And now, I think, again, since Claude Code, there's been this real shift of, oh, like, SaaS is dead. Maybe software is not going to be as valuable. Suddenly, investors all want to invest in hard tech stuff, which is— I'm happy about it. But it does also just show how fickle that side of the marketplace can be as well.

Have you seen any change to average burn rates with— or anyone in the batch token maxing so hard that you to say like, hey, you should probably, you know, I expect you to raise, you know, after Demo Day, but, you know, maybe, maybe don't spend a lot.

No, not yet. You know, I'm a bit reluctant to say this. I don't want it to change, but I don't think I have that much control. Like, I actually think on the ground, the founders feel like the subscription plans from the big lab companies are actually very generous. And so they're able to actually get as much token usage as they want largely out of those plans. It's sort of been what I've seen. We do internally talk about this. Like, we do wonder if there's some training we need to do to, like, push the founders to spend more on tokens, and that maybe they're thinking about tokens as something you should conserve spend on. Whereas, like, I think I and a bunch of the other YC partners really think about it, it's a lot more like rent. Like, you don't say, I'm not moving to San Francisco to build my tech startup because the rent's expensive. Like, yes, it's expensive, but it's it's the place to be, like you don't conserve on that. You like wanna be, you actually wanna spend money on that. There's other things you save money on. And so I do feel like because so many of the founders, especially if they're younger, they just don't have the budgets to use the latest models and be like cost insensitive and token max. So they're just used to conserving and trying to do more with less. And I think that may well change, but at least currently, I agree. Yeah. I don't feel like the burn rate is going up because people trying to get to product market fit are spending way more on tokens.

Yeah, it's interesting. It's like maybe you can delay hiring the incremental engineer, which actually can be very good because it's way easier to pivot if you have just the founders, right? Versus once you start adding. What about trends on the business model side? Last year I feel like the— classic VC blog post would be like, sell the work, not the product. We've seen some companies get to the point, let's, there's like a legal startup that's like actually just doing the contracts. They basically, they sell executed contracts effectively, but it hasn't maybe been as popular as I think a lot of people had imagined, at least so far. But what are you seeing?

I don't think the business models have fully switched over to like sort of pay-per-work yet. It's certainly pay-per-usage, but I don't think it's pay-per-work yet. And I think that's just because the agents as yet haven't quite been good enough to actually consistently deliver like the final contract in a way that makes the startups feel good about charging that way. I do think we're right on the cusp of that changing though. Like this batch really does feel like one where it's, it's not just sort of agents to review things or human in the loop or getting stuff teed up. It's really starting to be more end-to-end. And you're getting to the point where the agents are just doing all of the work. And at that point, yeah, you may well switch over. But I feel like maybe that's going to be a batch or two away.

Are we going to see a revenge of the network effect? It feels like in a world where software is mutable, and maybe like the million lines of code that you and your team built are not as defensible as you thought. The original SaaSpocalypse thesis, network effects businesses should do really well. I don't know if more founders are talking about that, but what's your interpretation? Because it is sort of the hardest moat to construct, happens sort of randomly sometimes, but if you can get it done, it feels like you'll be very, you'll be in a very strong position.

You know, you mentioned like the late-stage companies having like maybe midlife crises. That's where I hear network effects talked about more honestly. It's like some of those companies, if you're Whatnot or Kaushey at the moment, like, yeah, or Coinbase, like you're feeling pretty good about the fact that you are a marketplace business with real network effects and you're not worried about sort of someone vibe coding a competitor to you. So I think that's where I hear it. But I will say, like, yeah, again, on the ground floor here on the batches, I don't— we haven't seen as many founders, like, build pure marketplace businesses as you would expect based on that thesis. And I think it's just because obviously people are really excited to work with AI and build AI tools. They're not really thinking about it as, hey, like, what's got, like, a network effect moat, and how can I build that business?

Yeah. What about gaming? We talked to Diana a little bit about this. This, but it feels like we— you were seeing incredible demos of vibe-coded games. When I see them, I'm like, "I would love for a team of YC founders to work on that for 3 months to get it actually to a place where it's a real game instead of just a demo." And— but the underwriting for the game industry has always been different than the traditional SaaS venture capital flow. Is there a world where YC is more open to just pure games companies? We're just going to make a hit game. We're going to scale it into a AAA game studio. We're going to develop IP. That's a very different motion, but are you open to that? Is there momentum there, or is that something that you think is farther off?

Yeah, I mean, we would totally be open to it. Diana's definitely got the gaming background and the gaming expertise there. But yeah, I think we would be totally open to it and just, Like the reason you typically as a startup investor don't wanna invest in games is it's so hits-driven. Even if you get one hit, how do you know you get another one? What's replicable? But yeah, like, you know, these days, like if you can build some recipe for actually consistent producing games, and I feel like Zynga got the closest to that, though arguably that was more about like they sort of productized the distribution mechanism and the viral mechanics more than like the gameplay. But I know that seems plausible in AI. It seems like if you can actually build an AI or an agent that can consistently produce high-quality games. And also, you just be able to run so many of those experiments in parallel, so many more experiments in parallel than you could before. I think that'd be really interesting. Again, with us, it's the same thing. We need to see founders who seem like they've got some insight at that level, like they're thinking about it beyond just, hey, I really love playing third-person shooters and I want to build like a really cool third-person shooter game. We'd probably have to hear that in the interview, like, hey, like, I'm thinking of how this would like generalize and build out. And here's like where the the technology could be interesting.

I'm wondering if, I mean, I'm wondering if there's a lesson from, I mean, Hollywood is probably behind YC in terms of the forward-lookingness, but there's this interesting case study with Backrooms and Obsession, these YouTubers who went and made like classic Hollywood films, low budgets, but real budgets, and they put up huge numbers and they're massive successes in Hollywood now, driving a lot of attention. And it's interesting to think about like, what is the next category that gets unlocked that's more of like indie dev world, but now has the ability to scale through like the YC venture capital model?

Yeah, I think that's gonna be really interesting. I think that's where you might end up seeing, I don't know if we'll see like the one person, well, you might see the one person unicorns, but you certainly feels like you're gonna start seeing the one person, like $100 million revenue companies in a bunch of verticals because you've just got agents doing the core business functions.

Yeah. Have you ever had an Office Hours where a founder comes in, they're like, all right, I think I'm that company. I think I'm the one person $100 million company. Because everyone's been talking about this forever, but there's such a much stronger incentive to just hire the incremental person if it can make you— like, I just don't know that it will ever— I just, like, maybe it has.

You just want a buddy.

But, yeah, there's such a strong incentive, like, do I want to be the company that— I can do it all, but I got to have a friend around. Yeah, like, do you want to be the company that gets an award that doesn't matter, or do you want to win?

Yeah, good point.

Or not even a real award. It's just, like, it's something that you can say on the internet, and then people will debate it and be like, well, you hired this freelancer. You have a lawyer. Does that really count? I feel like it will never actually happen because it will already always be debated.

Sure, sure.

I personally have not worked with a founder who's come in with the dead set, like, I never want to hire anyone. I want to only work for myself. I mean, my guess is someone like that is not going to gravitate towards a community product, which is essentially what YC is. And so it could happen. Who knows? The thing that I'm seeing is 100%, you can get to Series A. You can get to $1 million or $2 million. $2 million of revenue without hiring anyone and being way leaner than you've ever seen before. But after you've raised the A or the B, it does seem like hiring is essentially the same as it's always been. Like, who knows whether that's because like, there's just more work to do or whether just like, it's like, you know, once then you have like your investors and they're like running the same playbook. But I definitely am not seeing any evidence yet of like those companies really slowing down on hiring. Yeah.

Can you give us the lore on the Paul Buchheit $100 billion question?

That's a funny— yeah, for sure. I mean, what's the lore? Like, you know, we do this thing at YC called Group Office Hours, where it's just a couple of partners and a group of the startups, and you kind of— it's sort of like a group discussion. Hey, like, what's going on? What are your problems? And sometimes, Google prompt with, hey, like, let's think about this. Again, everyone could like chime in. And Paul always had this great prompt, which was, don't just think about how you're going to be like a billion-dollar company where you get to like $100 million in revenue. Think about like, what's the next act from that? Like, how do you get to $100 billion? You know, like Google started off with search and then became so much more. Meta's the same. And so it's sort of like a— It's sort of like a mind-expanding exercise. And it's useful to do at stage because you get a sense for how much ambition and vision do the founders actually have. And sometimes it helps them get more excited about their own company when they realize, oh, wow, like, this is like, you know, I was thinking about it as like, how do we like build this one product that gets us to like, you know, $100 million revenue, but actually, I didn't even realize there's 6 other things we could do. I just have to like get there.

Yeah. Is it too small? Do you need a 10x? We got trillion-dollar companies now.

It's true.

It's inflation.

Even Elon.

Small time.

He just wants to sit around just knocking base hits to $100 billion. Are you swinging for the fences or not, Harsh?

Maybe I'll bring it back and call it the trillion-dollar—

It has a nice ring to it.

I'll brand it as my thing.

You should, you should. Sorry, PB.

Jordi, what was Harsh saying?

No, I was just saying Elon was saying on Sunday he would be surprised if they don't have a trillion of revenue by 2031.

I agree, I agree. What's the math?

The market's space-time, so you can't beat that.

Yeah.

That's right.

Anyway, we're gonna hop on with Gary. Thank you so much for hopping on the show. Yeah, it's good to see you guys again. Great to see you. Congrats on Demo Day. We'll talk to you soon.

Cheers.

See you guys in a bit. Let me tell you about Public.com, investing for those who take it seriously. They got stocks, options, bonds, crypto, treasuries, and more with great customer service. Absolutely, we gotta hit Gary with the flashbangs.

Right away.

As soon as he comes in. Gary. Jordi, how are you doing? Welcome to the show. He's now here. It's demo day. Watch out, there's a flashbang!

Ah!

Great to see you. Great to see you. How are you doing? Take us through it. How's the day been?

Too long.

Oh, it's awesome. I mean, it's always the big show here in San Francisco.

I mean, it's a beautiful, gorgeous day.

And you know, who doesn't like to go check out a nuclear reactor in our back parking lot? No uranium, don't worry.

Whoa. This is like the second or third nuclear company though, right?

I mean, I think we kind of need all of them, right?

Let's do all of them. What's stopping them from going critical in the parking lot?

Oh, well, luckily no uranium.

No uranium.

No Geiger counter needed. You're all good.

That's great. How much is hard tech booming? Do you have any like stats? It feels like every year there's a slightly more people taking the hardware isn't that hard. They say hardware is hard, but I'm going to try it. And it feels like that's been a trend that's been growing steadily. Am I correct to read that into the trends over Demo Days over the last couple of years?

Yeah, man, I got to call out my buddy Brett Gibson over at Initialized Capital. I mean, right when CodeGen first started happening, Brett was my first friend who said, you know, obviously, you gotta, you know, fund the bangers and it's not like they stopped doing B2B SaaS.

Yeah.

But, you know, Initialize was one of the first people to do the pivot to say, you know what, like hard tech is the way it's gonna go. And, you know, things like Flock Safety were sort of the first things we did that really, really became huge. And, you know, computer vision is in. And then now with AI, like everything is open. It's so much easier. I mean, you can do mechanical engineering, you could do electrical engineering. If you don't understand it, you can build it. You can find every vendor, like the supply chain management can happen right there, all in OpenClaw now. I mean, we're just in a new age.

Yeah, I mean, we've even seen people like optimizing their home Wi-Fi speed. Oh yeah. Like, you know, different—

Yeah, yeah, OpenClaw, it's crazy. A lot of the hard tech boom, I feel like, has been driven by Elon, Palmer Luckey, just sort of breaking the glass on like, it's possible for this to happen. And that's led to a lot of like defense tech startups, but I'm interested in the intersection. What are you seeing and how much conversation is there around hardware and AI data centers, stuff that's in the token path, but not in the direct path, not one-shottable by a, by a frontier model?

Oh my God. I mean, honestly, you should probably get Ashton Kutcher's here today. You should go talk to him. He's got a whole thesis around AI, solar. You know, he's actually pretty bearish on fusion, which is interesting. You should ask him about that. Okay.

Well, yeah, I think that's, that's news.

That's going to hit.

Yeah. Ashton Kutcher bearish on fusion.

He is like He went all the way, like he met everyone. So, I mean, Ashton has been an incredible investor, especially for hard tech. But anyway, I mean, I think what we've been seeing, there's like more, there's more defense here in this batch than the entire last year. Yeah.

And then— But there's also more geopolitical conflict. So there's more energy to purchase and the government's sort of changed a lot of the ways stuff is procured. And so, uh, the old adage, yeah, you need to be a billionaire to start a defense tech company, sort of gone.

The Palmers, the software singularity, and then hardware.

Who?

So it's, uh, Emil Michael, and, uh, it's our friends who are actually in the Trump administration who are like changing everything, like the DIU, like it's a new Department of War, like this has never You know, I think that there is actually an awareness that cost-plus, you know, cost-plus was originally designed to be something that created more innovation. And, you know, here we are 50, 80 years later, and, you know, what was needed for 50 or 80 years ago, it's the wrong thing now. You know, you have the defense primes that are just not actually innovating. They can't, like it's sort of structural. There's sort of these, you know, it's the equivalent of big tech tech bureaucracy. Like I think, you know, I think of iPhone, how stupid Siri is and how terrible it is, or even like Alexa over at Amazon. It's like unbelievable—

She ought to be fired.

—how incompetent. You know, I mean, these are very competent people put into a system that is structurally unable to deliver technology that is actually what people really, really want. And so, when you talk about consumer technology, like, you know, it's not that big a deal. Like, you know, my life is 20% worse, 10% worse, because I can't use a Siri that actually uses large language models properly, you know, years after it was designed. And I usually, you know, when I go to DC, I like to tell politicians that. It's like, hey, like, here's this thing that doesn't make sense in society. But, you know, it's consumer tech. It's— no one's going to really, like— probably very few people have died because of it. But when I really— what makes me mad, though, is when you think about, like, there are service members who are going to die in, in service of our country to defend liberty, and they're giving their lives because defense primes are not doing the job that they're supposed to be doing.

Sure, sure.

Right? They're not innovating. They're not bringing these new technologies to fore, and it's structural. And it's not like individual people trying to do it. It's structural, right? Like, just as the people who work on Siri, like, actually, we funded a number of them who have come and done YC. Delightful, wonderful people, like the people who work at these companies are incredible. Yeah. I never want to attack the engineers working on this stuff. It's actually structure.

Yeah.

Like you have big tech and you have, you know, big anything.

Yeah.

Right? It becomes structural where here's the thing that should happen. It does not happen. Why? You know, I think cost plus is one of those things.

Yeah.

Like it's just systematically instead of trying to create something that's better, it's like how do we maximize shareholder value? Value. And, you know, I get it. But also, why are we doing it this way? And so, you know, credit to the Department of War. Like, they are actually, for the first time in, like, decades, easily, like, they're actually open to a team of 10 or 20 people, whether it's, you know, in Boston, in Austin, even down the street in San Francisco, in Gundo. Shout out to our Gundo bros out there.

Yeah, we talked to Dan Durskall about this, about just, like having range days where any startup can come and pitch and they'll just buy the best product right there. It feels like it's an entirely new day in terms of procurement. Switching gears to software is like, I could prompt that with one prompt, I could build that, or it's just directly in the path of the labs, it's so easy to build. Is that the new, like, what if Google builds it? Like I have a feeling— Yeah.— I have a suspicion that we might've over-rotated on the, oh, like it's easy to build that particular product or vibe code that particular product. And it's like, yeah, but you didn't. And then this team did, and they went and did all the other hard things to get customers and understand the user and actually build a great product. And so, yes, you could clone it, but they have momentum. And so maybe they would maybe it won't be a trillion-dollar business, but there might be some beautiful businesses that are accelerated, and they look like SaaS, and they look like they could be cloned, but there's something secret there that's still going on. How do you think about that? Do you push back, or do you agree?

No, I think that, you know what, like, being in San Francisco and being friends with people at the labs, and being able to see, like, the inside, like, you know, being able to see the inside of, like, you know, what Codex and Claude code is going to be incredible, right? And then these are all 200 IQ people building 200 IQ models. And, you know, it's going to keep going. I mean, it's going to be, you know, true AGI. The takeoff is happening.

Sure.

And the thing you have to realize is like everywhere else, like, well, those 200 IQ people can't really interface the way that they need to with the 100 the 150 IQ people and the 130 IQ people and the 100 IQ people and like the mass of humanity.

Room temp.

Room temp, you need a room temp guy to build a great business. No, you talk to a lot of entrepreneurs and it's like, yeah, this person just worked really hard and found an interesting niche and just delivered.

Yeah, bring it down to my level, room temp.

But like, you know, we're joking, but on the, you know, on the other hand, like the world actually cannot interface with these things. The models will be too complex.

Totally.

The UI will be too complex. The more complicated you make any given solution, the less likely someone's actually going to be able to take advantage of it and implement it and use it.

Yeah.

And so, that's where all of the value is in business. It's like, how do you take this new tech that nobody has, that very few people understand, and then bring it to them them in a way that actually helps their lives. And, you know, I mean, obviously on a 5 or 10-year basis with, you know, superintelligence becoming what it is, you know, all bets could be off on like a long enough timeframe. But certainly for the next like 18, 24, 36 months, that's not happening. And for now, hey man, I— We're going to fight for the little guy and for, you know, the person who has nothing sitting in front of a recycled MacBook Pro to be able to make anything, to make prosperity happen. Like, that's what this logo is, right? I love it. That's what we're about. Like, this is, as long as this is a flag that flies, like, I will to my dying day will fight. I love it. For the startups and for startup founders and for people to be able to create something from nothing. And, you know, I think it's gonna be a while before we really have to worry about, are there going to be jobs and things like that.

No, I completely agree.

What, out of the current requests for startups, is there any category that comes to mind? Are you working on a new request for startups list?

Yeah, absolutely. I mean, we're always doing that. I don't know. I'm trying to convince Ashton to do the call for solar and reindustrialize America with me, so maybe you'll see that. Joe Gebbia, Chief Design Officer in the United States, he sent me the one about agriculture. You know, we're— I think that we're realizing that like YC has a real convening power and people really shouldn't have to just go and work on an— you know, nothing wrong with B2B SaaS and we love it.

Yeah.

But also like, you know, if you've got something in you that isn't that, like we can actually try to harness harness like all that brain power—

Totally.

—and all that AI power into basically everything. I mean, that's my— the number one philosophy that I think people have not absorbed yet enough and that I want everyone to hear and I will shout from every hill is that it's time to boil the oceans, guys. Like, everyone else is out there trying to figure out like, "Oh, let me like lay off all these people and haha, like the machines are better than humans." I was like, you know, we live in— broken, completely just— it's like a backward world, right? Like, if we could accelerate technology fast enough, it would solve a lot more problems. People would have a lot more prosperity. And now, like, the biggest— one of the biggest things, the blocker is not even money. It hasn't been money for some time. It's definitely not right now. Like, it's just pure agency. Like, do you have an idea? Like, can you prompt it? Like, can you actually— do you actually know how to use this stuff? And what do you want? Like, what do you want to manifest in the world? And if we do that, and we do that like 10 or 100 times or 1,000 times more than we have been, and we have, you know, and then going back to what we were saying earlier, like, it's actually about the systems, right? A startup is the defining system where either you do it or you don't. Like, either you have a customer that loves it or a customer that like doesn't buy it. Yeah. And like most of the time, frankly, like people love to bag on startups, is because those startups don't make something people want, right? That's why our t-shirt is literally "Make something people want." It's not more complicated than that. We actually give away the secrets on our frickin' t-shirts, gray t-shirt that you get on your first day at YC. But like, it's surprising how hard it is to do that. And then, but if we did that, you know, instead of trying to replace jobs, instead of trying to say like, you know, "Haha, I could like lower my cost by 90%." Yeah. Like, the thing is, that's why I love markets. Like, if you have— you know, just to take it— take like a big tech swing again. When you have a moat that is so unassailable, that is basically like regulatory capture. Like, you basically— if the government says like, actually, Apple, you can just not have multiple app stores, then you know what the government just granted? The government is okay with the monopoly. And when you have a monopoly, you have no choice. Choice, and then that's what we have. Like, we do not have choice about what messenger we use. Like, why is iMessage so stupid? If you had LLMs embedded in that, you would have— you know, we could actually literally save time by having that level inside our phone. But I guarantee you—

Personally, I like when I'm searching for like a very specific message that I know I sent and I can't find it. Personally, I just—

Where is the bar for big tech now? Where's the bar for big tech? Because SpaceX is now a $3 trillion company. If you're just hanging out at just $1 trillion, are you little tech now? Are you a $100 billion little tech company?

It's toddler tech.

Where is the line?

Honestly, it's like after people are like $10 billion valuation, I'm like, God bless you. Okay. Please don't, please don't mess up for the next.

Mess it up for everyone.

Yeah, please don't screw it up for the next generation. —you know.

Decacorn is the graduation.

That's just my experience, right?

Yeah, no, that makes sense.

You become a decacorn, you start hiring these Google PMs who come in and, you know, the same people who closed off the platforms on App Store and things like that, you start hiring those PMs and then it's over, guys, you know?

Oh, wow.

Which is fine. Like, as long as— the thing is, like, as long as there are markets, as long as there's choice, like—

Yeah, of course.

There's gonna be a check on that, right? And so that's my fractal. I'm like, hey, man, let's boil the oceans.

I've always enjoyed the public agenda. I think it's great.

Let's make so many more people— I mean, you want to get political? I don't know. I have a thing about that.

Not particularly.

Okay, no politics today. No politics today.

I would rather talk about gaming.

You're running. That's it. You're running for president. For president of the United States.

I'm Canadian. Sorry, guys.

Oh, interesting. I didn't know that for some reason. —reason.

I was born in Winnipeg. I'm naturalized though. God bless America.

Talk— what I actually want to know about is G-Stack. I want to know about G-Stack in the context of YC. I feel like YC, the whole goal, the whole system is built to allow the founders to talk to their customers, to build something people want. And that's why there's Bookface with investor reviews, because you could see a founder getting distracted and being like, I need to optimize my fundraising, so I should go build a database and interview everyone about what funds are the best. They don't need to because it's been done for every YC company that's gone through the batch.

True.

And is there a lens where I can view some of the research, some of the work, some of the experiments that you're doing around vibe coding, around G-Stack, as let me sort of like do the unhobbling, but fall on the sword of like optimizing sales systems and experimenting so that that burden doesn't go on to every single YC founder that's token maxing in the back.

Absolutely. Yeah, absolutely. Okay. So, GStack was sort of my project from like January through March. I'm still maintaining it and fixing it. But like, my new thing is GBrain, which I actually want it to be like the Postgres for agents. So, the thing I realized is that like, you know, when an agent, you know, a human can only keep like 7 plus or minus 3 things in their head, right? Like a phone number is about it, right?

That's generous.

But yeah.

I can keep hundreds of things, but yes, I understand.

That's very nice. Some of us are special. John, you're very special. And but a computer with an LLM, it can keep about 3 Harry Potter books in their head. And so—

It doesn't sound that impressive when you say it that way.

I mean, it's like a stack of books.

No, no, no. I understand. It's just way better when you say like like it can contain like 75 Erdős problems or like some complex math. That's right. Harry Potter, I'm like— but yes, I understand the context window is significant and especially when compared to a human. It's massive. Yeah.

And then when you think about like what most computer systems are, like actually you should think of like the Library of Alexandria, right? Like thousands of books, tens of maybe millions of books. Like actually it's even bigger than that. It's like the whole internet, right? And then, that's what like sort of like Carpathia's knowledge wikis are. People are talking about company brains. Like, you can basically take all of the relevant info about customers and everything that you've ever, any person that like any one of the companies ever even met. Like, that's what a CRM is. You can have that in like 100,000 or a million Markdown files that like comprises everything that that business is.

Yeah.

So, that's basically what G-Brain can do.

Yeah, I think people misunderstand that like YC has been building software to help batch participating companies for over a decade at this point, I think, probably longer, maybe 15 years. And so that is in the lineage.

Yeah, we're building that in.

Yeah, exactly.

I mean, actually, I think, you know, now we have all these tools that are gonna be built directly into YC Bookface. So, you know, you're gonna wanna be a part of the community.

Yeah, I've been seeing it's been getting better. Like the pace of The pace of software development on Bookface and YC's internal tools is accelerating. It's been refreshing to see that it's— people often have a window into it, and they see, like, oh, there's this demo. But there is an internal product that is evolving and getting better, which is great.

So the magic moment for GBrain is basically being able to take any book that exists in your entire business and then making sure the 3 books that really matter for the thing you're trying to do are loaded.

Yeah.

And then that's basically ASI. Like, you don't have to write software anymore. You can just straight up use Hermes Agent or OpenClaw plus this. Uh, I am trying to make it work with Codex and, um, you know, Cowork, but honestly, I think that those are like Hondas. And honestly, I mean, OpenClaw is still Ferrari, man.

Okay.

It's still the Ferrari, but, you know, open.

That's good. Very, very fun. What are the trends that you're seeing in applications? Are applications increasing in the age of AI? More people wanting to do startups? Are people coming from big tech?

Applications as in like people.

Applications to YC, like people trying to start companies. Like it feels like in all this anxiety of like big tech layoffs and stuff, like the flip side of that is that there's more entrepreneurial opportunity. Opportunity because we see—

Yeah, I find myself just pointing people to the YC website when they're— maybe they're not a software developer and they decide to build their first app in the last 6 months, which there's been many. I'm just like, go follow this, even if you're not going to apply. Like, this is what works.

Yeah. Did you see PG came out and said it? He's like, if you're non-technical, just stop calling yourself that. —because you shouldn't. I mean, why limit yourself, actually?

I completely agree.

I don't know. I think we're seeing—

Non-technical was always like— because obviously, like, it's not a binary. Like, I learned Python and a little bit of C++, and I could, like, sort of deploy a website. But, like, I'm, like, levels below, like, a true, like, you know, incredible computer scientist who's, like, creating Python. Python. But I would just sort of like be like, yeah, okay, I'm technical because that's good. But it's like there's obviously levels to these things. And the more you can get away from that stigma—

If you sit in front of Claude Code, I guarantee you could fix some bugs in Python and submit a PR that would be accepted. Yeah, everyone can. That wasn't true a year ago.

Personally, I think John could solve continual learning.

That would be great.

You could do it. It's just a matter of will.

I got a podcast to run. I'm trying to be low agency, low taste right now.

Low taste.

Low taste. Anyway, thank you, Gary. Congratulations on Demo Day.

Yeah, great to see you.

It's always fantastic catching up.

Good to catch up.

We'll talk to you soon.

Catch you guys.

Have a good rest of your day. Did you see—

I like the all black.

All black looks good.

I like the all black.

Did you see the Rolex opened a new boutique on the Swiss Alps inside of a former telecommunications tower. It looks like a Modern Warfare 2 map. Look at this building. This is an incredible place to hold a boutique. I guess you have to hike up here, but look inside. This is a Rolex boutique. You go in there, they show you some watches, but this looks like Modern Warfare 2.

Nick Carter says, "Imagine being told they have nothing in stock here. You both know very well they have watches." is in stock.

Yes.

What actual resort is it on?

I don't know if this is a resort. I think this is a telecommunications tower, but I gotta know more about this. We gotta get someone to call in from this particular boutique because this is an absolutely wild, wild, wild scene. But what a great brand activation. It does have a Bond villain aura, but I think it looks great.

Imagine hosting threads from here.

Imagine posting threads. You know what? Every time Connor Hayes comes on the show, he's like, you guys don't post on threads. I posted twice about this interview. So Connor Hayes, get in here and tell us what's new with threads.

What's up, gentlemen?

What's up? Good to see you again.

I'm doing great, man. Yeah, I do. I appreciated the post today, John.

I love it. I love it. We have been getting better. We've been posting a lot more on threads. We're having fun. And also, this is the weird thing. Is that like, I think, and you'll tell me, but I think what's driving Threads' success and the growth is the differentiation. Like I go there for car community, I go there for all sorts of different sub-communities around TV shows and different things that aren't really there. It's not work for me when I'm there, when I'm on X or YouTube or even Instagram now. My Instagram, my personal Instagram is just my personal brand, my work product. Yeah. But Threads has, it's more fractured, but in a good way, if that makes sense. But you tell me, what's driving all the growth?

First of all, can we just hit the gong?

Absolutely, absolutely.

For half a billion.

I was kind of waiting. Half a billion.

Congratulations. That was a big swing too.

That was a big swing.

It's a warmup swing.

Big swing for you, yeah.

The real swing's coming later in the show.

Yeah, so we announced 500 million monthly today. Huge. I mean, the— John, I'll get to your question in a second. But the other thing which I know we've talked in the past when I was on the show about growth coming from promoting the app and Facebook and Instagram. Yeah. You know, another thing that we were sharing today is the proportion of people that are coming to Threads not from those promotions has been going up quite a bit in the last year. And that's been a big focus for us. And we're doing it while deepening engagement. So we're up like 130% year over year on time spent in Japan, 80% year over year in Korea. So part of the playbook that we've been running is to pick these verticals and communities kind of one at a time and just blitz them from a go-to-market perspective and a product perspective altogether. And sorry if you guys get background noise, I'm literally like at a team party for this right now. Huge, amazing. So we got the entire Threads team surrounding me while I'm talking to you.

Non-family of apps referral traffic, is that links being shared on the open web? Screenshots? Is that referral like invite your friend or share a link in a DM?

Yeah, often actually the initial new user install comes from those. And then what we try to do is get people to come back to the app without a promotion the second time, the third time, et cetera.

Got it.

So that's been the thing that we've been most successful at. And that's just through like making the content better, getting you better connections in the app, launching messaging, which sends you notifications when you get DMs. And just having good content-based notifications too.

Yep. Yeah, I've transitioned from someone maybe a year ago that would click over to Threads when there was like, I was almost getting clickbaited by something to now just like a lurker because there's like good—

Oh, he's in the lurker category.

I'm in the lurker category.

You transitioned from lurker to reply.

No, I know, but every reply guy, starts as a lurker, right? I have to build up, I have to build up the confidence to move into that. But no, it's been, it's seriously impressive. And yeah, the car stuff is what I've been following most closely.

Yeah, yeah. Oh, that's so cool to hear. We've been doing a bunch with F1 too. I don't know if you guys are F1 fans, but we have this new feature called live chats. So we're trying to do like, one of the things people love about Threads is they call it the quiet app. Like you're in a, world right now where every single app you go to is like a sound-on video feed.

Yep.

You go to Threads, you can just like quietly scroll, read things that are going on. One of the things that we're trying to do is make Threads the live second screen that is still quiet while you're watching something on TV.

Yeah.

So we had a, like a Q&A with Lewis Hamilton and Ferrari last week. There's like him and a bunch of fans in a chat that thousands of people can follow along with, react to the messages, asking questions, We've done this for NBA Finals. So yeah, it's, we're just trying to be the best platform for public conversation. And that just means we have to lean into these live events.

Yeah, so it's, you're basically taking like what's great about the chat on, let's say like a Twitch livestream, right? It's like this real-time flow of information and ideas, but then making that like disconnecting it effectively from the programming.

Yep, tie it to a live event and put like authoritative voices in charge of it. We were talking, John, I think a little while ago about just how well we've done with reality TV. I don't know if you guys are into the "Summer House" lore, but that kind of like lives on Threads right now.

Is it Mike Solana?

I saw, yeah, I saw Mike Solana on Threads discussing some reality TV show. Maybe it was "The Traitors" or the, is that the one where they play like mafia? "The Traitors" is a good one. Yeah, there's a couple of these. And it's just so interesting when you bump run into someone who you know in a different context and they're on Threads and they're just like, they're sort of like wearing a different, it's a more casual outfit basically.

Yeah.

And like the posture can be very political on other apps or very defensive or very aggressive, or maybe they're a particular influencer and they're always, you know, this just killed this on LinkedIn, but then they come over to Threads and they're just sort of just being a normal person in some ways. If that makes sense.

It works. I mean, I think a lot of it is just because people want to wear that hat sometimes. I mean, you were talking about it with like your stuff too. There's something very like human about building an app that's for conversation and leaning into that. And I think in a world where like increasingly so conversation is just very hard to have or the person isn't a human, you know, we're trying to make that the case on Thread. So that's really fun.

What is the KPI culture like? 'Cause you're the quiet app now, it's working, it seems great, but like, it feels like there's gonna be a moment where it's like, okay, well, let's A/B test vertical endless scrolling video, and it's gonna outperform, and you're gonna be like, yeah, we're no longer the quiet app, we're actually just like the second Instagram, and like, and it just maths out. But like, it feels like that's not the mission, that's not the goal, but like, how will this actually play out?

Yeah.

I mean, I think that's the difference between metrics and goals. Like if the, you know, the goal is for us to be the best app for public conversation. I know that I could tomorrow pump time spent on Threads by putting more video in the feed. Sure. But that wouldn't make us the best app for public conversation. So we try to find metrics that give us as best the possible proxy for that goal. And a lot of times actually it is like how much is there back and forth reply happening on a top level post? Yeah. You know, in terms of growth, the main KPI that the team works on is what we call threads-driven DAO. It's like people that are coming back, not because they saw a promotion.

Sure.

So, you know, my job is to like set those goals, give them the best incentives possible, but then just know that the metrics are going to be imperfect. And sometimes I need to come in and, you know, make a strategic decision to do something that might be against the metric. Like, to your point, with vertical video, we're not going to do— we're not going to do a vertical video tab in Threads. Like, that's not part of the plan.

It's gonna be a horizontal video. You will turn your phone and it will be the entire Lord of the Rings extended edition. We're getting 10 hours. It's gonna be—

Yeah, 1996 NBA Finals Game 4, front to back.

How do you think about building your own kind of culture within Meta? Like, is that a thing? Is that something that's encouraged? Or is it like, you know, all big, you know, one big team? Or are there— do you guys like, do you guys have like a nickname for people working on Threads? Like—

They're not Meta Mates, they're Threaders.

Threads.

Threads. Threads.

Okay.

Yeah. We have a very unique culture. I mean, I think like all good cultures, it kind of like happened on its own based on the people that were excited to work on the app. Because I think if you're coming to work on Threads, you want to be on a smaller, scrappier team. You probably care a lot about culture and pop culture and the types of things that we spend our time on. We just had actually a team of people in here talking about how we do that. So I would say it's encouraged inasmuch as you're building value around the culture. But it's really important for us to not build the culture around the idea that we're different and special because we get so much value from being at Instagram and at Meta. Yeah. Like all of the infrastructure that we use, all of the integrity teams that we leverage, the monetization that we do comes from an ads team that's inside Instagram. And so it's like you're trying to strike this balance between making sure people feel like they identify with the app and the stuff that we're doing, but appreciate, you know, being inside the bigger company where we just get so much value.

Instagram Pro recently launched $3.99 a month, I believe, for some premium features. I upgraded Instantly, some fun details I haven't even dug into.

Who's viewing your story twice?

Oh yeah, that's one of the features that they show. I like the fact, I don't post on my story that often. I like the fact that I can extend it to 48 hours because I'm not a daily story person. I'm only sharing like news about the show on there when someone else tags me. And so just extending it a little longer, that felt like a valuable feature. But are you looking to that for, more premium subscriptions there? Are you more focused on the ad product on the monetization side? Like, because it's a new surface area, it's sort of unexplored. Where do you want all that to go?

More focused on ads. Like, we're not currently working on Threads as a part of the Meta subscription.

Thank goodness.

We love ads. Ads is a really good high-margin business.

I completely agree. No, I like the subscription too, but I see it as, A yes and for sure, because the ads business should be so good.

I think if Threads gets big enough and we have good offerings to people for something like a subscription, why not? But it's not something we're working on right now. We launched ads globally 4 months ago and have just been like slowly scaling it in line with the engagement going up, just trying to be careful about it.

Yeah.

Yeah. What is different about a conversational or kind of a news-driven platform like like Threads or like X versus like a more passive product. Like, you know—

People say lean forward versus lean back.

I think the big question is like the question that people have always had with Twitter and X is like, why wasn't the ad product like amazing for advertisers? Why did it never really maybe scale to—

Like, was it an ad matching problem or was it a behavioral problem?

There's been this like,— the audience on Twitter historically was so valuable. The user base was always smaller, but some of the most important people in the world are on there as their primary application. And so the big question was, why was it never a great ads business? Do you have any theories? You could say it was execution, or I could say that.

You could knock me higher. Connor Hayes says— Connor Hayes doesn't disagree Jordi?

He sat silently. I don't think it's the format because we know from years and years of experience. I mean, think about Facebook ads before the app was so video-centric. That feed format is kind of similar to what you have in like a Threads or an X today. And that was one of the most efficiently monetized surfaces ever in the history of technology. So I'm pretty confident that we'll be able to—

Yeah, let's go.

I'm pretty confident that we'll be able to get Threads ads into a really good place there. The other thing that matters is like, you know, obviously it's like how much attention are people paying to the content that they see in a feed, but also how much content do they view? Like the more shots you have to show them something relevant, the better you're going to do. So you're going to monetize more effectively if people are viewing 100 things a day versus 50 things a day.

Mm-hmm.

So, you know, to your point on KPIs, John, like one of the big ones that our team has is just like like how many impressions of content do people have in the app?

Yeah.

And then we try to make that as deep as possible by giving them more relevant stuff. And eventually some percentage of those will just be ads that hopefully are really good because they come from the Instagram and Facebook ad inventory. Like advertisers can just opt into their demand going to our surface. It's a checkbox in the flow where they create all the IG and Facebook stuff. So I don't know, I think we're set up for that to do pretty well, but we're just again trying to be careful and not scale it too quickly while we're still making the product great. It's been under 3 years at this point. So I think sometimes people lose sight of the fact that we're still a bit of a young app in the ecosystem.

Totally. Will AI-generated ads be more difficult to crack on Threads? I'm thinking that if I'm on Instagram and I have, you know, maybe it's Manus or some MSI or MSL like agent that can go take screenshots from my website, reinstantiate them, and put that in an Instagram flow, like you're showing me the product, job maybe finished, might convert well. But if I'm advertising on Threads and I need a really punchy hook and I actually need to think about like 140, 280 characters that are really, really high skill ceiling type writing, that historically has been hard. And that's why like brands come off as like cringey often on these short text-based— Yeah. Mediums, and I'm wondering, even though we have all this crazy acceleration in AI, I haven't followed an account where I'm like, "Oh yeah, like this model is really good at writing tweets or posts that are 180 characters." They're honestly better at the deep reasoning. I think that's part of what keeps us— Yeah.

That's part of what keeps us popular, I think. You know, like if there's, especially when you're optimizing for conversation, it's at least right now, humans are pretty good at telling when they're conversing with another human. And also there's a lot of metadata, right? They have a profile, they have a username, and they might be verified. I think for ad creative, you know, on the organic side, posts with photos in them do really well on Threads. It's a pretty high percentage of our top performing content. I think it's probably similar on X. And so my sense is that as AI-generated ads get more prevalent, it'll probably be through the image path more than the text path. Sure. And I don't know, I'm not pulling off of any data besides personal experience on this, But, you know, usually for me, the image is the hook when I'm thinking about buying something or getting, you know, more fond of a brand. Obviously the content matters at some point, but I think the image is gonna be what pull people in.

Jordi?

How much do you think about what Starlink will do to global connectivity? There's a bunch of people that don't have internet today that are gonna have like reliable, fast internet over the next 10 years, people coming onto the internet for the first time. Is that something that you're thinking about, or is there just enough people that haven't tried the app yet that are obviously taking more of the focus?

I think probably more of the latter. Like, we're not at the point with growing Threads where we're worried about, you know, lacking more opportunity at the top of the funnel for people that are already online, or maybe even already online and using similar services. The other thing is we tend to be pretty market-focused. We, like I was mentioning before, have been really focused on Southeast Asia. Japan, Korea are two of the biggest ad markets in the world. We are very US-focused. And so in these early stages, I think it's actually really easy, especially if you track a top-line global number, to see that go up, but not actually build an app that's like meaningful and makes sense and is a big part of people's lives every day in a country. Mm-hmm. So I look at success more as like tipping individual countries into Threads being the app of record for public conversation. Right now, that's starting to happen in Southeast Asia. And then the US is our biggest focus outside of that. So from that lens, I think in those countries, the connectivity is quite high at this point. So we worry less about that opportunity.

What's the plan to get @Connor on Threads? You got an underscore sitting there. How did you get sniped? You're the head of Threads.

Craziest part about this is the Connor is an Instagram employee, I think, or he was at some point.

Yeah, so he's locked it down.

Wow.

Wow.

Johnny-come-lately to their platform. Yeah.

That's hilarious. It's over. It's over. You're never getting in.

Walk me through the process of spinning up a little, like, I don't know if you call them like micro features or something. Like, a year ago, you launched sort of like disappearing ink text, like sort of glows and you put spoilers and these little features are, they seem so simple. They're probably getting easier to build because of AI tooling, but at the same time, like your code base can be kind of a mess. 25 people want to do different things with text at the same time. Like how do you think about those? What's the importance of that in terms of the growth?

So we have actually like, done a bunch of work to get the process on this right. I think social products often, there's so much work that is just getting the details right, executing well, but there's a bunch of work that's just like a hits business. Yeah. Look at Instagram, getting Instants to work. It's just you got to take a bunch of shots on goal with small creative teams. So a lot of the stuff that you see in the app that feels a little bit more fun, the music attachment feature we did, animated Stickers. These are like pods of 3 or 4, you know, technical but creative people that we just give a bunch of space to. We talk to them like once a week or once every 2 weeks about the ideas they have, give a bit of feedback, and then they've just been coming up with hits. So the way that— and your point about AI making that easier is true. I mean, the— I think one of the fun things that we've seen is that design talent has been getting more technical, which has made these things easier. To build. So whereas in the past you would have two people sparring over how to build a feature, now the really creative designer with great taste can actually develop the thing on their own.

That makes a ton of sense. Well, congratulations on hitting 500 million monthly active users. Thank you guys. Fantastic.

500 billion soon.

500 billion soon.

Hey, with Starlink, you never know.

Economic imperative, solve the fertility crisis because you need more users in That's the fastest way to get more. Everyone should be having 10, the 10-child policy rolled out globally. For Threads. Yeah, for Threads.

Great to see you, Connor. Congrats to the whole team. Thank you.

We'll talk to you soon.

Great work.

Have a good one. Incredible. AI Futures does it again. This is a post from Bronson Schoen. It says, mid-2026, France wakes up. Europe's leading lab releases le chaton factuel. Their latest open source Frontier model, it's state of the art. The US and China scramble wildly to catch up. The mainstream narrative around AI has changed from maybe the hype will blow over to I guess this is the next big thing. The US enters talks with France to hopefully gain access, but without much success. I like a little twist on the China wakes up from AI 2027, a funny copy pasta at this point, but still again, congrats to Ms. Straw. Thank you. On launching le chaton fat.

This is important before we're joined by author Luke Burgess. We have a safety alert from the US Embassy in Nassau. Ambassador Herschel Walker has an important message for Americans visiting the Bahamas. Jet ski rentals pose a serious risk of injury, death, and death. US government employees are banned from renting them. That's how serious they are.

Wow.

And you should avoid them too. Really taking shots at the jet ski industrial.

A lot of people were surprised to see Herschel Walker. He's a famous football running back. This is how they found out that he is in fact the ambassador. But fun story.

Is the risk worth it?

Jet ski? I don't know.

Are you a big jet ski guy?

No, not really. I'm fine. I prefer scuba if I'm on the water. On the water.

Every time I'm on a jet ski, euphoria. Good, you like it. Yeah, it's incredible.

They're fun.

I think they're underrated.

I think they're underrated.

They feel like very highly rated.

No, but highly rated, but are people organizing their life around jet skiing at scale?

It is nice that it's sort of the experience of a motorcycle with a lot lower stakes, right?

Goldrock says jet skis and vibe coding are a golden combo.

Yeah. Anyway, let me tell you about Cisco. Critical infrastructure for the AI era. Unlock seamless real-time experiences and new value with Cisco. Our next guest is the author of "The One and the 99: Forging Identity in the Age of Social Contagion." Ben, welcome to the show. How you doing?

Hey, what's up guys?

What do you think about jet skis?

Where you stand on jet skis?

We gotta start there.

We gotta start with jet skis.

As one who spends the summer literally on Lake Michigan, I'm offended by that warning big time. Oh, you love jet skis. I need to generate some positive mimetic desire for jet skis.

Okay, here we go. See?

I think they're still underrated relative to how fun they are. Don't buy them though. Rent them. Buying a jet ski is idiotic. Rent, rent.

Okay. Wait, wait, wait. Why? Why? I feel like when people say don't buy, they say don't buy the boat. Boat because the boat requires so much maintenance. Feels like the jet ski, you just pull it out of the water. It's not, it's gonna dry out. It's not gonna need a million dollars in maintenance every year.

It's just like a boat. It's like a boat.

Yeah, I mean, it's just what everybody, it's still a relatively large piece of equipment that I don't want in my garage.

I guess you don't wanna own it because you're probably not organizing your life around jet skiing. But if you are and you're gonna be jet skiing 200, 250 days a year, 300 days a year, then you might wanna own it.

That economic calculus might change. Problem of Malibu is lack of jet ski launch points.

Okay.

It makes it— it's good for the natural environment that there aren't, but it's tough to be—

You need a catapult from the bluffs to just launch you straight in.

Anyway, more importantly, let's talk about the book.

Give us the thesis, but first, can you explain what you mean by social contagion? What are some examples? Why that phrase?

Yeah, well, first of all, the book that I wrote 4 years ago was about mimetic desire. So I want to congratulate both of you for doing more than anybody in the history of media to generate mimetic desire by talking about founders and who's investing in who and the size of exits. I don't know if you—

Yeah, the gong.

—built your business that way, but— and the gong. So you literally are a mimetic machine.

Yes, I did work at Founders Fund. So maybe some of it rubbed off. Who knows?

Yeah, yeah.

Awesome.

People ask us, like, how do we book so many guests? And early on, we saw a pretty extreme flywheel, right? It's like people see someone they know or someone they like or a company they like, and then it just created this really crazy flywheel. And now it's been, for the last year and a half, it's been more about managing—

It's a perpetual motion machine. That's very good. Basically.

Yeah, yeah, yeah.

Fascination with things. Anyway, take us through it.

So this book, I mean, in "Wanting," I had one job, and my job, I think, was to explain the ideas of this obscure French thinker in an accessible way to the world at like an 8th-grade reading level, and I think I did my job. But it meant that I had one thing to do, and there was a lot of things that didn't make it into the book, unless my publisher was— he'd be very mad if I wrote a, you know, 600-page book. So I took that, all the things that didn't make it into that book, and I applied some of the ideas of mimesis and mimetic desire to the family, to the education system, to technology, to politics, and to religion. And, one of the most interesting things about— and what is social contagion, you asked me. Social contagion is just the unconscious way that we catch the desires of other people, the ideas and beliefs and emotions of others, and we integrate them into our sense of self and the way that we move through the world without really realizing that we caught these things from other people.

Is contagion bad? Because it feels like contagious, it feels like I caught a cold or a flu. It feels like a negative twist on mimetic desire. Desire feels like something that could take you in a bad place, but also could be good. And just this idea of pulling something you want, what someone else wants, like that can be good. Someone else wants to go to the gym, be healthy, healthy, do something like you wanna do that too, that's probably fine. But contagion feels like it's mimetic desire, but only in the negative. Is that the way I should be thinking about it?

No, no, no. I mean, I'm very clear in the book. Like there's such a thing as good contagion, right? There's things, the desires that I wanna catch, right? Like if I wanna be more ambitious and take more risks, maybe I should move to Silicon Valley, right? So I think there's definitely good contagions out there.

Okay, so you wanna jet ski more, maybe you move to the Bahamas.

You move to the Bahamas, right? Or yeah, move next door to you.

Yeah.

Yeah, totally. So, and one of the interesting things about AI in the book is I'm wondering if it's actually contributing to contagion and mimesis in a way that we don't fully understand, right? Like, did you guys see that Tim Ferriss blog?

Yes.

About what's happening to his nonfiction books, right?

Yes, I know exactly what you're talking about.

So he's talking about, yeah, like he had an 80% drop in sales of his book.

Yep.

And it coincided with like, 2022 when ChatGPT came out. And he's saying like, why would somebody read prescriptive how-to nonfiction when they can go to, you know, ChatGPT or a chatbot and ask, well, here's my life, here are all the things that are going on for me, apply, like what should I do? And by the way, like summarize Tim Ferriss's book.

Yeah.

But make it highly personalized to me. Like why would you read the book?

Yeah.

You get instantaneous, highly personalized, customized advice. So I wonder though if that is actually going to lead to, a form of contagion that we don't even understand because there's something happening in, in, in the AI. Even the engineers don't fully understand what it's doing and it's giving us back something that feels really personalized to us. But the inputs are obviously being drawn by what, you know, large language models and what other people are putting into it. So I wonder if it's— we're entering like a Pluribus, you know, the Apple Show kind of situation where the AI is actually, while seeming highly personalized, it's actually sort of contributing to some form of social contagion.

Yeah, I feel like we are in the sort of like, we're just starting to diagnose the social contagion that breeds on social media. And we're just starting to understand the effects of what seeing certain videos or political biases or even memetics, just like you see a sports car and you want a sports car and that changes your perception of things. And with AI, it feels like we're in this unknown, unknown period where it could wind up creating more the pluribus. It also could wind up being more personal. And so everyone sort of goes into their own world. There's this weird stat where like the, I think it's like over 50% of high school students are a super fan of some creator. Mm-hmm. That none of their friends know about. And so they are in this like niche internet micro celebrity world, NIM cells, where they know everything about this one Instagrammer or this one TikToker, this one YouTuber's life, their repertoire, their whole catalog of work. And they talk to their friends and they're like, No, I've never heard of, you know, Markiplier or whoever is like their choice. Or you're a Doug DeMuro fan and you run into someone run into a car fan and they're like, "I've never heard of Doug DeMuro," because you're in this niche world. But at the same time, you do have this, like, you know, like ideas do spread extremely quickly. And we're just starting to diagnose that. And with AI, it's somewhat similar where, but potentially even more removed, 'cause you might be getting fed Tim Ferriss insights, but it's sanitized of Tim Ferriss's name. And so, it feels like it's personalized to you, but you're you're actually doing what everyone else who's asking the same question is. It's very hard to diagnose. It's very hard to, to track the actual outputs. What do you look for in, in the book in terms of like, just level setting on like, how things are going in America, the state of things, whether we're on the uptrend or downtrend on a particular category, or even just like the level of momentum? Yeah. That's something that I can't really, I don't have an economic factor for. I can't trace it to GDP or incomes or anything like that.

Yeah, I mean, it seems like the book is basically about the relationship between the self and groups in various communities, right? And to what extent can we be in something without becoming completely of it? Whether that's a political party or a city, you know, if I live in, I could live in Vegas, which I did. There are certain things that I really like about living in Vegas, but there's other parts of Las Vegas that I don't want to permeate me, right?

Sure.

So, it's like, how do we be part of something and take the best from it and give our best without it completely forming us and determining everything about us? So, when it comes to the state of the US, I mean, I'm finding that maybe it's because of social isolation, but I'm finding people over-identifying with very various communities, whether it's national-level politics.

Yeah.

It seems like when people don't have a solid sense of self, which is a term that I use throughout the book, a solid sense of self as opposed to a pseudo-self that is constantly adapting to expectations and conforming as we walk into different rooms and move to different cities. It's kind of the malleable version of ourselves. It seems like to the extent that people don't have a solid sense they're much more likely to be sort of liable to capture by the first group, party, whatever, company that comes to them and tells them how special they are. And I sort of noticed this over-identification, right, that worries me quite a bit. And it's like groups want everything from us. They want complete loyalty, which, you know, like right from the very beginning, right? It'd be like meeting a girl at the bar and like, she's asking for a full commitment right in the beginning or else you don't love me kind of a thing. It's like, no, we actually need to take time to test things and get to know each other. And it's probably not a good thing to completely identify. We like to situate people and people like to situate us. And some people own those labels and some people are kind of repelled by those labels. So the book is kind of looking at identity and the way that we— how easy it is to situate people and how we how can we become a little bit immune from being overly situated ourselves? And the most interesting people to me, I don't know, like a Taleb kind of a figure, are those people that are really difficult to situate, like politically, that you never quite know what they're gonna say. They're the most interesting people for me to follow.

Yeah, Renaissance man maxing. What do you think of the maxer culture? Because that feels like the, in many ways, like the worst case scenario. Of what you're describing, where whether it's looksmaxing or fitnessmaxing or whatever maxing you're doing, it's like everything else about the identity has to go by the wayside. And we saw this very interesting clip with Clavicular, the popular looksmaxer, where they ask him about politics and he doesn't even have a read on any politics whatsoever because it's completely irrelevant to what he actually cares about, which is just looks. Yeah. Looks, and it feels like there's the inverse of that, which is someone who's politics maxing or left-wing maxing or right-wing maxing, and they don't have an opinion about anything outside of their political domain. And if you ask them about health, they would have to toe their particular party line. And that, it feels like in the competitive sphere, maybe that's something that's going on with maxing. But how have you been processing that trend of maxing?

Yeah.

Yeah, yeah, my colleague and friend Jordi Hays did a whole thing on clavicular, who you've seen on the show.

Yeah, he's great.

Which is worth watching. I mean, my book is an anti-maxing book and I think maxing is evidence of exactly what I'm talking about because when you max anything, like what are you giving up in order to do that? Like you can't max everything, right? So I'm pro like maxing in my marriage, I'm pro maxing love. But apart from those things, like there's really nothing that I wanna max because it turns me into an individual that— I mean, what's interesting to me is that there's some people that just max one thing and then they get exhausted and then they just look for another thing to max. I mean, that was me throughout my 20s, right? I was maxing on a company so hard that I didn't even— and I didn't even like it, right? And I would get bored with it and then move on and start another one and max on that one. It's like maxing cannot be an end in itself.

I went through this with health. Like, there was a period of my life life in college where I would, it felt like 80% of my attention and energy was just going towards being healthy. And I eventually got to the point where I was like, okay, the point of, at least for me, the point of being healthy is so that I have energy to do other things. And I can feel good day to day, hopefully live a long time. And I just went from, I went from like 80% down to like 10%. 10%, and I probably got a little bit less healthy, but it just freed up all this energy to do other things. But the benefit of going through that maxing period is I learned like a lifetime's worth that I now still get the benefits of. Yeah. And that's part of what probably keeps me higher from a health standpoint than my previous baseline. So I would say for me, it's like going through periods of obsession has been healthy, but it's like, how do you eventually figure out the time to remove yourself?

It's fun to grind, but you don't want to get lost in the sauce.

Periods of obsession is the keyword there, right? Periods of obsession. I don't know if anybody's done some kind of empirical research study on this, but I would guess that a very low proportion of hardcore maxers have children.

You know what I mean?

No, I know.

That's been a game changer for me.

Instinctually, I think everyone agrees with you.

If you had to turn your book into a Tim Ferriss-style self-help book that would then be summarized by an LLM, what would the output say?

Well, it's not a prescriptive how-to book, first of all. But I bet if you turn it into one. If it were.

No, but to me, like periods of obsession. Periods of obsession. Boston obsession.

Well-rounding maxing and Renaissance man maxing.

Yeah. I mean, it would probably tell, you know, I think that we're really bad at leisure and especially like ambitious entrepreneurs and founders. And I've been one for most of my life. So, one of the things that it would probably tell people to do is actually think of leisure as a skill that you actually have to get good at. I suck at it. I remember being on a beach in Thailand when I was starting one of my companies and I could not rest. I could not sit still. I could not have any fun at all. So one of the things that we do at the Clooney Institute, which Jordi and I run together, is we quite literally offer really busy founders and people the opportunity to come on like humanities retreats and chill out for a couple of days and think about the human person and think about important questions with the promise that they're going to go back refreshed and with a better sense of what they actually want— might want to max out on for a couple of days, actually. But wait. Leisure is not a popular thing to talk about in this world, but learning to do it well has been one of the most important innovations in my life.

All ties back to the jet ski. I do my best thinking on the jet ski.

Yeah.

You gotta be able to turn off. It is really, really hard. Where do you stand on digital detoxes, dumb phones, black and white screens, those sort of like dopamine, dopamine fasting little mini techniques that people like. Sometimes they can go, they can become their own pursuit and their own obsession. But where do you stand on all that? Like what is the secret to like unplugging, I guess?

Yeah, I mean, I think you've gotta know yourself. The micro mini little tools have never worked for me 'cause I guess I'm like an all or nothing kind of guy. So I have to like go hike the community trail I don't need to go to Santiago for 30 days to witness any change whatsoever, right? For better or worse, that's just like the kind of guy I am. If there's like some incremental n+1 change that I'm making to like, you know, I don't know, the background of my screen, it doesn't do anything for me. So like, but to each his own on that stuff.

Well, thank you so much for coming on the show. The book— Thanks for sending it. —is "The One and the 99 Go Pack." Pick it up wherever books are sold. Thank you, Ben, for coming on the show and chatting with us.

Yeah, let's do it again soon.

We gotta do this again soon. This is a really great conversation. We'll talk to you soon. Have a good rest of your day. And 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 AI agents. And without further ado—

Speaking of agents.

Our final guest of the show, Anna Graszka from Meta. Notch. She's the co-founder and CEO. Anda.

What's going on?

Welcome to the show. How are you doing?

Great to see you.

Hey guys, I'm good. Good to see you too, Jordi. Good to meet you, John.

Good to meet you. It's an honor to have you on the show on a big day.

Take us through the news. But first, introduce yourself for everyone. Introduce the company a little bit.

Yeah, thank you. Hey guys, my name is Anda. I'm the co-founder and CEO of Notch. Notch has been the leading digital intelligence and optimization platform for Fortune 500 brands for the past 6 years or so. And our news today coming live to you from the Guggenheim, actually.

The Guggenheim.

Where we've taken over the Guggenheim for the day is that we just announced ACE, which is infrastructure that makes websites convert both humans and agents.

Okay. So what, what is the, what, what was the first big client that you brought on board? The first big logo? What did you actually try move the needle for them? How much of that is focused on e-commerce conversion versus brand building, broadly marketing? Like, where's the surface area of the impact of the product?

So when we started going to market, we actually moved from Silicon Valley to New York with my co-founder, and some of our first clients were the biggest banks. They still are. If you can think of the biggest bank in the, in the world, they're our client. Our surface area of your impact, look, we track our audience's journey through digital experiences and we help brands understand what's resonating with these audiences, what's not, and how they can ultimately gain more customers by making better content and better digital experiences.

With Ace, this feels like a product that people have realized that they need really acutely over the last year,— we had Matthew Prince on, I believe it was maybe the middle of last week, and he had recently shared that there's more web traffic from agents now than humans. That flip came even faster than he was expecting, and so now there's a bunch of Fortune 500s that you guys are working with that are kind of waking up to this, realizing that they need a solution. But I guess talk about kind of the, the origin of the new product.

What we saw across the biggest websites in the world, which we measure with Notch, what we saw was the same thing. There were more agents starting to come to websites than humans. And about a year ago, every single CMO became obsessed with GEO or AEO, which is how do I make my website readable to agents? But ultimately, LLMs cannot be gamified. And the trick of GEO, which is publish another 100 blog posts and 10 other product FAQ pages and whatever, it ended up really destroying the human experience. So in the last 6 months, we've actually seen crazy high immediate bounce rates, like human beings that actually arrive to websites and are getting a horrible experience because they're presented with this agent-ready, agent-first content. So ACE, the origin story was really how do we build a system that can we can personalize for each of these audiences without taking away from the experience of the other.

And that's making the agent side invisible to humans and vice versa? Like how does it actually work?

Yeah, so let me tell you how it works. So ACEs, first of all, we have to ingest all of a brand's knowledge from currently it's sitting in silos. The website is just one area where that knowledge exists. So we ingest that knowledge alongside brand guidelines, governance, et cetera. That knowledge gets vectorized and atomized, and then it gets semantically tagged. This step is really important because what you want is to enable both the humans and the agents to retrieve this information through natural language.

Mm-hmm.

Then we start to reassemble the information based on implicit inputs. Like, these are kind of the data signals that we've been capturing through Notch for the past 6 years, and that reassembly enables for a really personalized human experience as well as a personalized agent experience. So for example, I'm a mom. I've been looking for an electric car that doesn't look like a mom van, and I've been doing my research in LLMs and I know nothing about cars, unlike my husband. And so I type in electric car that doesn't look like mom van, and it's telling me to go to, you know, gm.com, rivian.com, et cetera. When I get to that website, which I will still go on because I want to validate the information, I wanna see like, is this brand the brand that represents me? What I get is really static, really generic, essentially a dumb website that doesn't actually speak to me. And so it's a very jarring difference. And LLMs have really conditioned us to expect conversational experiences and the ability to really command these experiences through semantic intent. So what we've built with Ace is the ability to give GM the, uh, capacity to allow people to just copy-paste their research from an LLM. Mm-hmm. Them, put it on the site, or just simply say, I'm here to, you know, find an electric car that doesn't look like a mom van. And then the site reassembles with dynamic atoms in response to what you just said. So the whole website comes to the homepage. There's no more pages. It's really just dynamic reassembly based on your semantic input. When an agent shows up, the same thing happens. It's the same knowledge base. It's just visualized differently. It's a different modality. It's really just code.

Very cool. Yeah, there's so many people talking about generative software, software that's created on the fly, but forgetting that websites in their current form mostly have just been effectively digital catalogs that are kind of, you know, there's just one version of it. But that's very cool. I wonder, yeah, the idea of like, you know, And that's like, in some ways, I've like stopped going to a lot of websites because I know it's easier to get the information that I really want. But the thing is, then the brand is losing full control over how they're being displayed. Maybe they want to be showing images at different points that— and obviously the chat app or whatever a consumer's using is— You know, they don't have any control over kind of that whole service area, which is rough.

Yeah, they really don't. I think the website as we know it today is definitely dead. I think we have to replace the word too. Like, I'm, I'm starting to play with knowledge site because I think what really matters in tomorrow's world, whether or not humans still come to your experience, right? What matters is that you have that knowledge in a knowledge base that can speak to agents. Right now, what brands are doing is they're just cramming a bunch of crappy content into the same website. And it's not personalized for humans and it's not personalized for agents. And so the experience, of course, is gonna turn people off and people are gonna stop going to websites. So we gotta enter a new era where websites are dead and long live the knowledge site.

What's the long-term, sorry.

Oh yeah, no, my immediate thought is like you want the, you want like the source of truth and then you want to be able to effectively just prompt the, and be able to get the answer information that only matters to you. But what were you gonna say, John?

I was gonna ask about just the, obviously you've seen a ton of success in the enterprise. Are you thinking about going downmarket? How do you think about that? What are the decisions that would lead you to work with smaller companies, or is there just so much valuable, so much value and such a unique problem in the enterprise that that's where the company will, be firmly placed for the long term?

We're gonna go everywhere, John. We have big ambitions. I think this product that we built can serve everyone. And actually, if you go to our website, it's running on ACE now, and we've built it in the past 48 hours because, you know, we're a startup, so we leave things last minute.

I love it.

But if you go to our website and start prompting it, I'm sure, like, I just said this, and so many people are gonna go try to break it. So, you know, knock yourself out and send us feedback if you manage. But yeah, I believe that any company needs to have a knowledge base that's accessible by agents that they can control and maintain in a really structured, governed way. I also believe humans are not going away. Like every time there's been a new tech trend, whether it's social media or something else, we've always been like, guys, this is it. All we need is a Facebook page. I don't, I don't believe in zero-click marketing. I believe humans like choice.

Mm-hmm.

I believe especially especially for high-intent purchases, we really like to do our research. And so I believe websites are going to be around because, you know, it's kind of a yes and situation with marketing. It's always LLMs are just another channel really to optimize for.

Yeah, I just went to notch.com, as you said, and tried it. And very cool to have the bar on the bottom. You can just, and then they basically just creates a section that's just like effectively generating whatever information you want, which is like, John's talked about this before, like RAMP, who we work with, like it's nice to have access to language models within the application, right? You don't, sometimes you want to take it—

Totally.

You know, back to your preferred agent, but having intelligence where you are already makes a lot of sense. And I wouldn't be surprised if this is like, you know, hopefully you guys capture as much value as possible with this like new paradigm, but I'm sure a lot of other people will happily follow suit.

Yeah. Well, Jordi, I think there's actually a great use case for TBPN as well. So if you guys want to be customers, I'm all ears. I mean, you guys create so much great content, and you're truncating it in a really great way, making it accessible in a way that enables you guys to just give people the information they really came there for would be cool too. So let's talk.

Yeah, totally. Transcripting.

Let's do it.

I love it. Well, thank you so much.

So great to finally have you on the show.

What's up, Doc?

OK. Go check it out and get the demo today. Thank you so much for coming on. Yeah, great hanging.

Thank you guys.

We'll talk to you soon.

Really appreciate you having me on. Bye.

Have a great rest of your day. Let me tell you about Codex. Codex is a powerful workspace for getting work done with AI agents, whether you're writing code, analyzing data, creating content, or automating business workflows. Codex helps you move projects forward from start to finish.

Over on X, Daniel's advocating for banning social media for over 65s.

Yes, yes, the inverse of the Hays. Do you think the UK's project or the UK's initiative to ban social media for under 16— over 65, I think that would ruffle some feathers— that would probably be pushed back on more by the social media companies because the purchasing power from 65 onward is so high. There's so much wealth with the boomer generation. That would actually be very devastating to Facebook YouTube and TikTok even. The young folks, I think all the social media companies have an incentive to get those users as early as possible, keep them on the platform. But I think more than anything, they want a level playing field. So Connor Hayes can duke it out with every other social media site as soon as someone turns 16, try and acquire them, try and get them on board. But we'll see as that rolls out. Thank you. Out and where the guardrails are set.

We'll close out the show with Sean Frank. Everyone is doubting Meta. Spenders are mad at bugs and model changes. Investors think they're missing AI, like the AR saga all over again. But as a large-ish customer who will spend something like $100 million with them this year, Meta is working and no ad space comes close to their level of scale. Don't doubt the Zuck. The fact that you can buy, that you could have one SpaceX or two Metas for the same price is pretty unbelievable. And certainly not something that most people would have guessed even a year ago.

Yeah, it is a crazy, crazy situation. At the same time, rockets, they're inspiring. And social media is inspiring.

Totally. I mean, I can see how we got here, but it's still surprising.

But yeah, obviously fantastic business. And yeah, people probably need to reality check with Sean Frank, because he's in the trenches. He understands the business better than most. So go pay attention to him. Anyway, thank you for tuning into TBPn today.

It's been an honor and a privilege.

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Cheers.