EP 2: Wordle, Wordcels & Shape Rotators, Miami Tech, and FB Earnings

Welcome to the second episode of Three Cartoon Avatars. I'm your host, Logan Bartlett, and I'm joined today by my esteemed co hosts, Nikita Beer and Zach Kukoff. Guys, we did it. We made it through the first episode.

We did it. We did it. Joe.

Thanks to everyone for making it through with us. Hopefully that was the worst episode we're ever going to do, and we'll only get better from here. I just want to say we really appreciate all the feedback. Please do keep it coming. And I guess based on the response that we got, largely, it feels like the world might actually need another podcast of VC bros talking to each other. So thanks everyone that subscribed and listened and rated and all that good stuff. Zach, Nikita, any. Any comments from the first episode?

I think a lot of people are upset that we took the last podcast spot that was available.

That was. Yes, podcasts are infinitely scalable, so I would encourage anyone to potentially sign up if they do, if they. If they want to start their own.

No, no, no, no. This is a finite resource. There's only one podcast allowed a year, and it's ours. So sorry. To anyone else.

Yes. Well, no, I appreciate it. Nikita, how. How did it feel to come out as a Jewish white man and not a. Not an Indian woman for your Twitter followers?

It wouldn't be the first time in college I actually got booked in a women's dorm because of my name. It's kind of an awkward first day.

Was that freshman. Freshman year coming in? How did that happen?

Yeah, Freshman year at Berkeley. I guess they thought, Nikita, that must be an Indian woman.

How did that get unwound? Was that your dorm for all the freshman year, or did they realize the error of their ways?

I just had to go talk to the person managing it, but it was an awkward first day.

That's good stuff. Well, Dak, what about you? Any funny things from last week's episode?

Yeah, I had a lot of follow up on our chat about Calendly last week. I don't know if you guys heard anything from folks on Calendly, but weirdly, I had a lot of people come inbound. One of my buddies sent me what was like a saga of him trying to get something scheduled. So he was at another venture fund and he was chasing after a deal in the context here is it's sort of a, you know, classic super hot deal. Call it like 36 hours between first meeting the company and having to put in a term sheet. Right. Something that certainly Logan and I know nothing about. He comes in, he Meets the company once. Great first meeting. Okay, I want you to meet a couple of my partners and more senior partners and come in and get to know more of our team. So the founder sends him a calendly fine to like the most senior partners in the firm, which, like, fine, whatever. I respect that power move. The calendly has one time slot available and. And it's 15 minutes long, which I think is really incredible. Like, he's like, I wanna get the whole partnership around to meet you. And he sends him one 15 minute time slot and that's it. Shockingly, they did not win the deal.

Was that intentional, you think? Or was that. Was that actually just like the default setting?

That sounds like a flex to me.

Yeah, that's a big flex.

Was this Nikita actually? Was this guy?

Yeah, Nikita's like, I was racing for my new company last week and weirdly, I also sent somebody one 15 minute calendly slot.

I mean, when we were ranked number one in the app store and we were getting denial of service attack By like every VC in town, you know, there were VCs that were just like, we'll drive the whole partnership to your office and pitch in your office. And I just said, look, if you can wire money in 72 hours, then you're in. So I mean, I raised the entire round, I think over text message during that period time.

That's wild.

Yeah, that's impressive.

Well, I guess my biggest update was Big P. Marca finally unblocked me. I don't know if it was related to our episode or if it was. I'd heard he had been doing like a. A little bit of a purge, coming back for the people that he had blocked in the past. So I don't know causation correlation here. But yeah, podcast, mission accomplished now. So all good on that front.

I think we can shut down. That's it. We're done.

So I guess one other piece of feedback, Zach, something we. We probably need to talk about is what is that noise you make when laughing at times on the podcast, I had more than one person ask me who was squealing at times with laughter.

I had a former manager once called it my dolphin chirp. Although I don't think that was meant to be a compliment at all. It is my go to laugh, unfortunately, and it's a burden. It's my cross the bear that I can't laugh normally. But I appreciate that everyone now has come along for the ride.

We all have our things and. Yeah, I know. I mean, I feel like for the People that are. That are listening, hopefully they're committed to bearing with us and the occasional dolphin noise.

I'm sorry if you can't handle me at my dolphin. You don't deserve me at my thought leadership.

It's hard. Nikita's coming out as a Jewish man. You're coming out as bald and a dolphin noisemaker.

I don't think I was ever hiding that I was a Jewish man. To be clear, I don't think I was hiding that I was bald either. I think that was public knowledge. Just not Twitter. Public knowledge perhaps.

I didn't even realize there were distinctions between those two. Yeah, Twitter actually is my entire world, so I guess that was my framing here. So news this week broke that wordle, a game that's not playing, has increasingly become a defining characteristic of my personality, is being acquired by the New York Times. So just a little bit of background if you've been living in a cave over the last few weeks. The game was released in October 2021. It's rocketed up usage in the last few weeks, and now they have several million daily players. The acquisition price was rum to be in the low seven figures, which is obviously a great payday for one guy, I guess first and foremost, guys, do you play wordle?

I do, yeah.

I. And, And Nikita, what's your typical score on wordle?

I. I got the last one in. Three guesses. I was pretty proud of it.

Wow, that's pretty good.

Send it to everyone I knew.

It feels like you've accomplished it, but it's so much more luck. Like you could never get a crossword all in one try. But if I got wordle in one try, even though it's totally locked, I'd probably just tell everybody in my contact list, like, take the day off. I want to fucking ticker tape parade. I'd want a lot of like a huge achievement.

Hey, general catalyst, like a email all. I got wordle in two guesses or whatever.

Like, yeah, yeah, I'm texting him on directly. Like, hey, heads up. I just got wordle one guest, so I'm not going to come in today. Just.

I know we. I know we have that presentation tomorrow. The company's coming in, but I.

That's not going to work for me. Yeah, I'm taking a lap today. I give up.

I'm sure he'd be probably an understanding guy about that type of stuff.

Yeah, exactly. We're all a famously relaxed group here.

Nikita, maybe take. I mean, you've gone through this moment of lightning in a bottle Kind of app taking off, maybe take us through, like what's actually interesting about wordle that's made people identify with sharing this product over and over again. And then also just what's going through this guy's mind.

Yeah, I mean, I think wordle is a classic viral product story. It's products that build distribution into the product flow that really take off. And when you play it, you want to share it. Like that's part of the game. Every time you finish, you want to give it another shot because you either failed miserably or you did well and now you think you're some kind of genius. Those mechanics are similar to Fortnite, where round after round you're getting roped back in, but they were pretty clever by staggering it out each game day by day, so that you are seeing it constantly on a routine basis. And I've always told founders the only way you can get habit formation is recurring exposure on third party networks. And you're seeing it on Twitter and on Facebook newsfeed daily. And it's really hard to forget about it. And they don't, they don't need push notifications because, you know, it's, it's there.

And Nikita, don't you feel like it shows? There's a pretty big market for these kind of games where you have, maybe you're not smart, but you have the appearance of feeling smart, right? Like, you don't actually have to be all that smart to get wordle to work, but you do have to be pretty smart to do like a crossword puzzle or to do Scrabble or even like Bananagrams.

In some ways, the appearance of feeling smart is basically like, that's the way I define myself in general. So it seems like a game that I actually should, should get into. Y.

That's actually why I log on to Twitter every day, is to feel smart.

I think that's like a textbook reason people share on any social product, like either to be funny or to be smart. And wordle, what they do is they make this like little one minute task that can make you look smart. And I think that's, they've perfectly packaged it similar to Twitter. You know, you write 140 characters and then suddenly everyone thinks you're a stand up comedian or the next Einstein. But they've done it in a way where anyone can do it in a very constrained manner where you don't actually have to be that smart to. To get a high school.

Yeah, I definitely don't feel smart and yet my score would reflect that I'm a serious word sal.

Yes, yes, we'll get to that in a second. Zach, Nikita, if you're, if you're the wordle guy, what's going through your mind right now? Why tap out? Why the decision to sell to the New York Times.

I think this guy's probably experiencing like extreme, like emotional trau and stress right now. Like, he's probably sleeping like two hours a day. A one man shop running something of that scale. There's probably a crisis like every few hours. And so I think he wanted to tap out. I know I did. When we were adding 380,000 users a day, it was, you know, there was always something that I needed to deal with in the middle of the night. So. Yeah, so I think he probably wanted out. But at the same time, you know, the. We did hear the price was in, you know, the, in the seven figure range. That seemed low, but it. He probably signed that term sheet at the beginning of January because you announce an acquisition when the definitive merger agreement is signed then that's. That was just recently at the end of January. So I think that the bulk of the growth probably occurred during that closing process. And it didn't really. It didn't really price it in to the price he was getting. But I'm sure he's certainly happy. Like it's game. Like games are hits driven that you never know how long they're going to last. So I think for him, you know, one man thing with no investors. I mean, you could probably buy a house wherever he wants to live now.

Yeah. It's your point. I think there's sort of a mirage baked into this sometimes. Nikita, like to the point is made, they bought, they signed this agreement right before a lot of the growth. You sign it, you get the endorphin hit, like a ton of the growth coming on. And then three months later, four months later, maybe not in this case, because the times is a good mechanism for this, but three, four months later, a lot of the growth disappears, right? So you get sort of almost this head fake early.

Isn't that a case with a lot of these apps? Like, you could have said the same thing with Instagram, right? And then they threw it within Facebook. Everyone made fun of it at that. At that. When they paid $1 billion. Right. And now it's whatever, it's worth 100 billion within the company. So sometimes you catch it on the right side. I, you know, Clubhouse certainly had its viral moment and who knows? I mean, they seem like great people. I'm sure. That are working hard to figure out what the next act is going to be for them, but they did around at whatever $4 billion it was rumored Twitter was going to buy them and they decided to go down the other path. And so I don't know. I think sometimes you get this stuff right and sometimes you get the stuff wrong.

And by the way, I do feel compelled to defend clubhouse. They have a lot of international growth right now, so we'll see. I feel like I'm the contrarian here, but we'll see. There might be an act too.

Zach, last week you were giving me a hard time for simping for Andreessen, and here you are on the podcast Simping for Andreessen.

I think with the case with wordle is that it's a game. So they're definitely going to. They're spiking right now in terms of engagement, adoption, obsession. The mania is there, but it's definitely going to flatten out, I think, at a certain point. And given that the new. It's the New York Times is the buyer, I think they're going to treat it like the jumble or the crossword puzzle where you're going to eventually have this durable base of people who do it like every day as their routine. I would just be skeptical if people continue to share it in feeds after the next month.

I sure fucking hope not. Like, I cannot. I don't know if you can mute blocks or characters or whatever. I don't know how to do it, but I certainly would. Now I'm waiting for lib propaganda to be. Start. Start going through and people getting really, really anti w on the new words that are coming out. Right. It's in the last wordle.

The word was Jews. It was really. I was kind of offended, you know, as. As a Jew.

It was.

I actually think Jews are probably the best wordle players. And just FYI for listeners, Nikita and I both are proud members of the tribe on this one, but I do feel like Jews probably overperform on wordle.

Yeah, yeah.

Logan doesn't get to laugh at any of these Jew jokes, by the way. LOGAN laughs. We know.

I laughed really hard and then caught myself right there. I. Yeah.

We already sent this clip to the American Defamation League.

I was going to say.

That's right. ADL's on your ass.

We'll figure out how to edit that. That my laugh out. Right. If anyone watches this on video, it'll just be my mouth open with no audio coming out. Well, okay, so, Zach, you referenced this a second ago, but it's a decent segue I guess to the topic of shape rotators versus word cells. I was honestly hesitant to to cover this as a topic because I don't want our podcast to basically become us recapping whatever the hell Mark Andreessen's tweeting about in a given week. But it feels like it's become sort of ubiquitous in Twitter over the last seven days or so. So for people that have seen this and I've actually gotten questions, hey, are you going to cover what the hell's going on with this at some point? Just because I think a lot of people are confused. Basically what has happened I think is in mid late December, Rune on Twitter. We can put a link to his Twitter in the show notes came up with these two terms, shape rotators and word cells and basically roughly maps to engineering, math, science on the shape rotator side and liberal arts types on the word cell side. And so it's basically gone viral. Marc Andreessen, as he's want to do, has turned this into a bunch of a bunch of memes. Rune went through and explained a lot of this in a post that we can also link in the show notes. But I don't know your guys reaction to 1. Why has this taken off in the way that it has? Why has it gotten the curiosity of billionaires sort of tweeting about this? Would love to get your guys perspective.

I think it's fucking hilarious. It really captures the animosity that I think technical people in tech feel towards non technical people as non contributors. And it's also funny it came from I think one of the most interesting clusters of Twitter, which is the pseudonymous group of accounts because they actually tweet really funny shit. That's my favorite group. And it seems like they've become the most followed accounts by all the billionaires. And I mean what we're talking about is these are likely your classic neck beards in tech, like infrastructure engineers, machine learning experts. And it's just funny to see them co op the language of a bunch of like anime avatars and them to become like minor celebrities overnight.

Hey Rahul and Roon, if you're listening, I don't think you're a neckbeard. Okay, Nikita might think you're a neckbeard, but I'm a big fan genuinely of

the two of you. I say there's nothing wrong with being a neckbeard.

That's what he's saying that you're not. In the chat with us for Hul and Roo no, your real friend on the podcast is okay, not Nikita.

Zach and I will ride or die. Especially if you guys are starting companies. You can send us an email, right? Yeah.

If you want to start Zach, he him a company, feel free to send it away.

Yeah, exactly. Honestly, we won't even judge the hair on your neck. No, I do, I, I do think this is kind of the last like bastion of, of Twitter coming together of like purity of not giving a fuck. It's basically the, the anonymous accounts that are making all these, making all these terms up or whatever, and then the billionaires who are kind of at the uncancel point, and the two of them coming together and basically ganging up on these terms. It's actually a fascinating sort of confluence of groups coming together.

It's sort of the perfect us versus them narrative, right? To Nikita's point. Like, it's not just contributor versus non contributors. It's also like the, as Andreessen put it, like, it's the whole east coast media elite who are perceived to be gatekeepers and better with language versus a whole world of people who build things. And by the way, we should point out shape rotators in this case is very literal. Have you guys done the shape rotation test?

Yes, I have.

Okay, so here's the question. Did you guys pass the shape rotation test? Are you a shape rotator or are you a word cell?

I pass, but I still think I'm a word cell.

That's what Nikita. I actually disagree with that. I think you are a shape rotator. I also.

Big shape rotator energy.

I also passed. But I, there is no question that I am a word cell. I went to when I got a liberal arts degree. Had had this term existed, like, it wouldn't have liberal arts on it. It would have said word soul. Now I, I'm a self loathing word cell. I, I wish I were a shape rotator. I, I. In another place.

You know, I, I don't like you either, Logan.

Yeah, that's. That's actually loathing. Self loathing is me. Loathing is you. Yeah.

I'm about to reclaim the phrase word sell. I'm a word sal, but I'm proud of it. And by the way, I'm gonna put it out there. I found that shaped rotator test hard. I couldn't figure it out. I looked at it, I was like, I don't know, these all look the same to me. I can't figure out what any of these shapes are supposed to be, but I think it's not a Bad thing to be a word sell. I don't think it's pejorative.

You know what? It's actually funny that this has now gone through this Burning man life cycle to some extent, where it starts with this niche, cool group, and then slowly expands to billionaires that are coming in and maybe ruining the fun to some extent. I feel like Art Basel kind of went through this. And so we had Burning man originally. Then we have Art Basil. Now we have Word Cells and Shape Rotators, all the very normal extensions here.

Well, someone tweeted at me, there's no alpha left once the VCs get into it. And that was, unfortunately, before Mark jumped in.

But I think the ones that are like Toby from Shopify, Mark Andreessen, I think they, you know, they have the Shape Rotator vibe to them. The alpha's still there because, I mean, it hasn't crossed into Patagonia Vest VC yet.

Well, yeah. And of course, obviously, Logan and I are way cooler than that crowd.

Yeah, way, way cooler. It's only with the cool VCs right now and not with the Patagonia best VCs. Guys, another topic that is near and dear, I think, to all of our worlds is the Miami tech scene. So inevitably, we were going to hit this as a topic at some point. It felt topical because, Nikita, you were there this past weekend. Zach, you were there for Hereticon, what was it, 10 days ago or whatever. So maybe for a little bit of background. I assume anyone that's listening to this kind of understands what's going on. But just to give the short version, Keith, or Boy, an investor at Founders Fund, they were actually going out and looking at a place. Him and his husband were frustrated with San Francisco and California, and so they went out looking for a place. Interestingly, Keith told me their first option that they considered was Nashville, which is actually where I was born, where my family is from, where I actually was this weekend. And so it's a shame, I think, for the Nashville tech ecosystem, that they didn't end up landing there. I think the airport wasn't big enough to support flights that they wanted out to San Francisco on a regular basis or whatever. I forget the details of it, but now Miami has been sort of willed into this thing. It's become something of a meme. They'll let me know if I can be helpful with Francis Suarez, the mayor. So I would love to hear from you guys, having been there in the last two weeks, where you stand on the very polarizing topic of Miami tech.

I had an Amazing time there. I was out until 5am Three nights in a row. Quite a bender. It was for Miami Hack Week. I gave a talk on a panel on Web3 with Mike Arrington. I certainly wasn't qualified to be on that panel. But what I think is interesting about Miami is that the pecking order, like the status pecking order for people in tech hasn't been established yet. So if you're new in tech, you can actually hang out with relatively successful people. And like I saw interns having conversations with like literally sent to millionaires and going to high profile events on yachts. You know, if you were in San Francisco, you know, and you're just coming as a new grad, you're at the bottom of the totem pole. You know, tech is a meritocracy, but in a mature city that has its status order defined already, it's going to be an uphill battle. So I think it's actually like a really great place if you're just starting out and there's enough people there that I think it has a lot of potential. But it's very crypto. I think people don't realize like 90% of the companies I met were doing something in crypto.

Yeah. Nikita, your comment is my problem with it, Right. You're saying you were out till 5am Three nights in a row. That's exactly my. I like Miami, by the way. In short stints. I have a good time in Miami in short stints. The idea of living in Miami full time, knowing that so much of it is around, as you said, Nikita, staying out really late all the time. And by the way, in a world where outside of crypto, you basically don't have critical mass of founders, you have critical mass of VCs and finance guys. That to me is sort of a harder sell.

Yeah. Zach Kukoff, a 27 year old

with

a 55 year old's mindset here.

A 55 year old hairline too. Thanks.

55 year old hairline and mindset.

And that's right. I'm going for the George Costanza lane here.

Yeah, the George Costanza vc. Zach Kukoff here. No, I will say Miami definitely has this big freshman college dorm energy where everyone's out partying, everyone's like sleeping with each other. It feels like, you know, everyone's just excited to be here. It has this like energy of when you first move into a college dorm and it's like so nice to meet you. It's great. Like a very equalizing sort of playing field of all the People that have moved there. And I will say everyone's been very accessible. Right. I know for a long time, Keith, if anyone DM'd him, he would get together with them for a meeting. Right. And I think everyone's, like, trying to court you into the Miami tech mindset. I feel like I have to come clean. This is something I've kept to my family and close friends only. I wasn't comfortable enough sharing broadly, but it feels like the appropriate forum to say this. I'm a Miami enthusiast. Whoa, whoa, whoa, whoa.

Jesus.

I felt. It felt like something that I've kept to myself for a long enough time. I started Miami curious and now after having spent a lot of time there, I am. I am a full on Miami enthusiast.

You know, I still will accept you for who you are, but this has been a really disappointing moment for me.

Yeah. Logan, we love you. We accept you. We honor your experience, wrong as it may be, but still honor your experience nonetheless.

You know, I am still a New Yorker, like, and that's where I really consider home for me. But it's, it's, it's such a good, like, energy. I love the warm weather. It feels like there's an optimism there that other cities don't have. I don't know. I. There's going to be mistakes and it's going to take a long time for it to actually get to the. The point that it is an ecosystem. Anything more than just like loud people on Twitter. But I think it's going to get there. Like, I really do. And I think people are going to will this into an existence. And so it is a bummer that like, like, you know, where I was born, Nashville, Tennessee isn't going to benefit from this. But I feel like Miami has really embraced it and everyone's kind of leaned into it.

I don't know if I agree with your take 100%. Like, here's my problem with Miami. Well, besides the going to 11 until 5am that Nikita apparently experienced, my other problem with Miami is it feels like everybody who moves down there only hangs out with other people who move down there recently. It's like moving to Paris and only going to the American bar. Hanging out with expats all the time. I had dinner with somebody down there and who is a classic, you know, finance guy who moved down with his much younger girlfriend. The nice thing is, by the way, that describes like 80% of the people who I met down there. So that's actually so broadly applicable. It could be anybody. They all just hang out with Each other. Like none of them have friends outside of the tech crypto world.

This isn't so specific. They're going to be like, zach's talking about me. There's like 15 people that are like,

there's like my entire itinerary is going to be like, Zack's talking about me. And I'm like, maybe, maybe I am.

I was in Miami 10 years ago and the tech scene was like 10 people. It was Austin Bunsen. And that was it. Like really, that was like the entirety of the tech scene. And I hadn't gone since. And I totally realized why everyone there is an expat, because it was basically non existent. So I think, you know, even if you hung out with everybody in an equal representation, you're probably still going to talk to like 90% expats.

But then at that point, why not stay somewhere else? Like this, this is the thing that was a head scratcher for me. If you, if really all you want is to save on taxes, which, hey, I be the last person to throw stones out of the glass house here, it sounds great. But if really all you want is to save taxes, it doesn't have to be a crusade to go save taxes, right? Just go down there. At least the guys in finance have the decency to move down there quietly, not make a big deal out of it and just save their money. What I don't love is like the elevation of moving down there is a moral good thing when it's maybe a tax play.

Well, to be clear, the tax thing, you have to at least give wonderful warm weather in the winter and the tax benefit. But I'll go a step further and there is just like a, there is an optimism there, right? And like people are moving there and they're enthusiastic about it. And it's not the cynicism that you see in San Francisco or on Twitter or whatever. Like, there's just a friendly, much more welcoming vibe to it. And so I hear your point on not like embracing the tech or the existing ecosystem. And that certainly has elements of truth, I'm sure. But to Nikita's point, one, there wasn't really one there. So it's like, how do you ingratiate yourself with something that doesn't totally exist? And two, it's hard for me to throw too many stones at this when there's so many other really cynical cities that aren't appreciative of having smart people move in, create jobs, all that stuff.

Who cares about the ecosystem? My point is they don't have friends who are outside of tech or outside of finance. Like, if everybody you are like, maybe you both have this. I don't know. But if everybody you're friends with also works in tech or also works in VC or also works in finance, and then you move to a city where everyone you meet also works in those fields, I think I would miss having normal people.

Wait, hold up, hold up, Zach. Are there other people?

Yeah, that's the point, right? This is like,

I have plenty of friends from high school. I don't really know what you're talking about.

What are you going on about, actually? I mean, I understand in LA you have people in entertainment, you have people in real estate that mingle with the same groups. In Miami, it's like tech summer camp.

We've all seen selling Sunset Nikita. We know the two different buckets of people in la. Now, I will say one of the things that I do enjoy about New York and Zach, I guess to your point is like, I remember one time I was at a holiday party for a venture firm, like, five or six years ago, and Mark Pincus from Zynga and Al Gore were there, and everyone was like, oh, my gosh. And maybe Reid Hoffman or something. And everyone's like, oh, my gosh. Reid Hoffman and Mark Pincus and Al Gore. And I'm like, those aren't, like, cool people, you know, I mean, I'm sure they're wonderful.

Speak for yourself, man. I love Al Gore. He invented the Internet. Maybe you've heard of that.

But, you know, being in New York, you get with, like, you go to a bar and people are excited because Leonardo DiCaprio's there or Derek Jeter's there or Lorne Michaels is there or whatever. It's just a much higher level of perspective of what cool is. It's not in this little bubble. And so I hear that point, but I think that is to discredit. There are a lot of other industries that exist in Miami. It is insular, I think, the tech scene a little bit. And that will. Hopefully it brings along the different industries that are already there, the different people that are already there. I think there's a nice opportunity to marry those two together. So I guess, updating from a topic of Last week, Bolt founder Ryan Breslow announced that he's transitioning to an executive chairman role, which I've never exactly known what an executive chairman does. It feels like kind of a role exclusively reserved for when you don't know what to do with a founder. I saw a bunch of conspiracy theories out there about what he was planning and all this stuff. I assume this didn't. There's kind of only one of two paths in my mind. One was this is all preplanned and this was some guerrilla marketing to some end. Right. Or the other one of the board saying, what the fuck? Like, dude, we cannot have you doing this right now. Those were kind of the only two options there.

I mean, he went on the My First Million podcast and his, his explanation was that he was stepping up to executive chairman, not stepping down. I love that.

Yeah, that's me saying I'm no longer scooping ice cream. I've stepping up to eating ice, as a matter of fact. Got fired.

Yeah, no, exactly. It's like when a toddler comes over and asks you can they help with whatever you're doing? So you give them a piece of paper and just have them draw in the corner. It's like, sure, yeah, you're helping. Yeah, you're doing a great job over there. Yeah. I don't know exactly what the intent of all this was, but it's interesting. There was some speculation. Austin Reif from Morning Brew tweeted out some links to some of the stuff that he had posted previously that, that Ryan is maybe going to start a incubator and that he was kind of laying breadcrumbs to that, that he was going to start a YC competitor. I don't know what your guys perspective

on that is how much that do you think is him after the fact saying, God, I have all this attention now I can do something with it versus how much do you guys think was pre planned and premeditated?

I don't think it was after the, like whatever this was, was either very pre planned and this was a methodical, like he was buying ads on his name. Right. And like all this stuff. And so it's, it's either very pre planned or, or like it's just a total disaster. And so I don't think he would have been leaving breadcrumbs of like, you know, conspiring up against YC or whatever and then also been ousted momentary, like at a moment's notice.

Yeah, I totally agree. I feel like my, my guess is the most likely outcome here is the firing was perhaps not premeditated. The YC part was also perhaps not premeditated. And he caught a tiger by the tail a little bit to some extent and felt like, okay, what can I do with this now?

Yeah, no, that totally makes sense.

Yeah, I think that like with this new incubator that he's creating. I can't see any incubator really taking off in 2022. I think the whole funding of like Pre Seed has. The funding landscape has changed where applying to YC is now just showing what you're building on Twitter, showcasing it, getting people's attention, getting in the DMs, and then instead of giving up 7% of your company, there's a host of like Tier 1 VCs who will invest at a 30 million valuation on a Pre Seed deal as long as you're competent and you can generate enough hype. So I think things have become a lot more implicit in that inception state of a company versus this formal, almost college application process.

You're kind of implying there though that there's no lessons learned or camaraderie in a batch or network around selling into this group that comes from it. Is it really an either or thing? I mean, I understand as a repeat founder you wouldn't go through it, but it feels like there is more than just the capital and the visibility to it. Or am I being naive?

I mean I didn't get into yc, but I did go through techstars and the biggest of value add was just the volume of meetings that they booked. So like the first 30 days, I think I met 90 investors and they front load all the worst investors so you could get the kinks out of your pitch. So by the end, when you're pitching General Catalyst,

notably not Redpoint included there, by the way, I like that. That was nice. I like at the end, the beginning

is when there's General Catalyst and then at the end Redpoint. No, no, no, your words got mixed up.

Yeah, it's funny as, as a techstars alum myself, I can tell you, Logan, it was certainly Red Point first and then General.

Yeah, I'm sure, I'm sure in Boston actually General Catalyst was the last day of meetings and so. But I just remember how terrible I was at pitching at the beginning. And then, you know, at the end it was just like I was getting it check after, check after, check after. And I think you can actually get that experience today in like the post Covid world where you're just doing all the pitches over zoom because you could stack meetings and meet with like 20 VCs in a single day.

For all of our listeners at home, just note that Nikita said General Catalyst was the single best investor by that metric of all the people who came in for techstars. Just note that for yourself.

Yeah, I was about to say what I heard in that whole thing was, I heard Boston and actually I think Zach Kukoff maybe is the last venture investor left in Boston. So it totally makes sense that in the Boston batch I like to think

I'm just the best venture investor, not the last venture investor. But it's, it's, you know, the, maybe the best venture investor.

You're a big fish in a small pond, Zach, and we're really proud of you.

Can we cut me saying the best venture investor in Boston? That's going to play like I'm a huge fucking asshole.

No, I don't.

Sure, we can cut it. We got it. So I guess another topic to hit, kind of a mixed bag of, of earnings over the last few days. So Meta, Facebook took quite a bloodbath, down 26% after hours, which I think, I think translates to something like $250 billion of equity value. Just wiped out. Snapchat smoked earnings, they were up 55% after hours. Pinterest blew out earnings 25%. Amazon was up 18%. Some of these are the lag of days factored in because Facebook was the one to go first and then so pulled down some of these other businesses and then obviously all these businesses are impacted differently in some way. So Zach, I don't know if you have any perspective on any of these specifically. Facebook and Snapchat seem to dominate the earnings. So any thoughts from you would be awesome.

Yeah, I mean, it's not a huge shock to me that Facebook's earnings are down. You know, we all know that Facebook Apple struck a pretty big blow to Facebook by restricting the IDFA that Facebook uses. Actually, the more the funnier point here is in some ways, you know, Snap's targeting has never been all that great. And so it's not a huge shock that Snap has done pretty well in a world where Facebook now has to move from hyper specific hyper targeted advertising to more general advertising. The bigger question I think is what's going to happen to all the small businesses who are reliant upon Facebook, both venture backed and not for access to a really cheap, really high quality source of customers.

Yeah, it's so interesting. People frame this as like a privacy thing without the trade offs and considerations of who the beneficiaries are of this. And so yeah, to your point, like Snapchat's never been great at direct, direct response advertising where Facebook has built all the infrastructure, both with Instagram and Facebook, the blue app, to really target in a micro level. And so people always think about Cambridge Analytica and like, oh, this is all this political targeting and manipulation. But in truth, the big beneficiaries of this are small businesses that can reach their customers in a way that wasn't possible in the past. And so it's interesting to see in consecutive days like Snapchat as a beneficiary of shitty ad targeting and Facebook getting crushed with it. Nikita, as a former employee of Facebook, would be super interesting to hear your perspective on kind of what's going on inside the machine.

I mean Facebook's in a pretty tough position and I felt this for a while. They've built this well oiled machine to grow products but not create them. And at the current stage, all their existing products have been fully monetized. And now we're actually now at the end of that life cycle where the mature products are actually experiencing a lot of churn from coastal wealthy users who bring in the bulk of the revenue. So, and this was the first or this was the second quarter that had a consecutive user loss. And in parallel to the churn happening in coastal areas, engagement's dropping too because competition is coming in fast like, like TikTok is now like the primary place where people get entertainment. But I think what's even more threatening is imessage because they have close friends and that's a serious competitive threat to like what Facebook has. Facebook has never really owned close friends. They've tried to with Messenger. It's always been a loose tie network. But imessage is a crazy wedge. And this sounds crazy, but I think one day if they ever had stories it would like, it would really tank Facebook stock. And the other challenging thing here is that they can't acquire anymore. I mean the FTC and the antitrust scrutiny they're experiencing. So of course they'd want to acquire a product like Discord, but the regulators aren't going to allow it. So not only can they not acquire, they have they experience this kind of decay on their products. It's tough for them to build too because I mean very few big tech companies have done zero to one product development. So I think it's like a perfect storm that they're in. But like having said that, I still think Zuck is like one of the greatest operators of all time. And maybe this metaverse play will play out sooner than people think. But I think realistically we're about 10 years out before face. Computers are things that the normies start using.

You left out like all their best talent, their former acquired products, the best talent walking out the door and leaving threads of all the lessons that they've learned, like you did when you left Nikita, that. Yeah, I mean, Logan, who.

Yeah, who do you mean by that, Logan? That was unclear to me. It could be any. Anybody who left Facebook.

I mean, this was the first quarter. I wasn't there on the roof, so,

yeah, causation, correlation, it's hard. Who's to say which one this was Nikita resting.

Investing was the only thing stopping Facebook from getting decimated by earnings.

The glue holding the org together was Nikita's feet on the desk. All right, well, that's a wrap. Thank you for joining the second episode of Three Cartoon Avatars.

All right, we will be here next week, probably, unless we get canceled this week covering news, drama, etc. Etc. So if you're on tech Twitter, try to create some problems for us to discuss.

See you next week.

And Nikita, are you gonna tease. Tease your app for everyone? Give it. Give it. Give a preview of what you're actually building.

Yeah, I felt like I let everyone hang in, so I. I do want to say what I'm building I'm currently working on.