History’s Largest Oil Disruption, Oil & AI, Sundar's New Pay Deal | Alex Epstein, Dr. Alex Wissner-Gross, Charles Lamanna, Julien Bek, Eoghan McCabe, Michelle Volz

Sign up for TBPN’s daily newsletter at TBPN.com (02:43) - Ships in Gulf Declare Themselves Chinese to Dodge Attack (04:32) - Largest Oil Disruption in History Reactions (16:18) - Oil & AI (41:22) - Sundar's New Pay Deal (50:12) - Four Loko For Sale (01:02:01) - Dr. Alex Wissner-Gross, co-founder of Eon Systems, discusses the company's recent achievement in creating the first multi-behavior upload of a fruit fly brain, marking a significant advancement in whole-brain emulation. He explains how Eon integrated existing research, including the FlyWire connectome and NeuroMechFly simulation, to emulate the fruit fly's neural activity and motor functions, resulting in naturalistic behaviors like walking and grooming in a virtual environment. Dr. Alex emphasizes the potential of this work to pave the way for future emulations of more complex brains, such as those of mice and humans, aiming to enable human and non-human minds to operate in the cloud. (01:21:47) - Charles Lamanna, President of Business & Industry Copilot at Microsoft, leads the development of intelligent business applications and low-code platforms with generative AI. In his recent discussion, he introduced Copilot Cowork, an AI assistant that automates tasks across Microsoft 365 apps, integrating Anthropic's Claude model to enhance functionality. He also highlighted the upcoming Microsoft 365 E7 suite, which combines Copilot, Agent 365, and advanced security features to provide a comprehensive AI-powered productivity solution. (01:36:33) - 𝕏 Timeline Reactions (01:40:59) - Julien Bek, a partner at Sequoia Capital based in London, began his entrepreneurial journey in high school, building hardware companies before transitioning to software investments. In the conversation, he discusses the impact of AI on software businesses, emphasizing the shift from selling tools to delivering outcomes, and highlights the importance of combining AI's intelligence with human judgment to create defensible, service-oriented companies. He also shares insights on leveraging AI to enhance venture capital workflows, such as automating meeting analyses to improve decision-making and prioritization. (02:01:12) - Eoghan McCabe, co-founder and CEO of Intercom, discusses the company's recent $250 million funding round aimed at expanding their AI-driven customer service platform, FIN, which has achieved nearly $100 million in annual recurring revenue with 8,000 paying customers. He highlights the evolution of FIN from handling basic customer queries to addressing complex problems, emphasizing its ability to provide faster, more accurate, and cost-effective responses compared to human agents. McCabe outlines plans to extend FIN's capabilities across the entire customer lifecycle, transforming it into a comprehensive customer agent that enhances interactions from initial inquiries to post-purchase support. (02:14:34) - Alex Epstein, author of *Fossil Future*, discusses the critical importance of keeping the Strait of Hormuz open, as it facilitates the passage of approximately 20% of the world's oil supply. He emphasizes that any disruption could lead to significantly higher oil prices and global economic instability. Epstein also explores potential strategies to ensure the strait remains accessible, including military action, international alliances, and addressing threats like mines and drones. (02:44:45) - Michelle Volz, founder and managing partner of PAX, a $50 million early-stage venture fund, discusses her transition from Andreessen Horowitz's American Dynamism team to launching her own fund focused on foundational categories. She emphasizes the importance of founders being magnets for capital and talent, especially in sectors requiring significant early investment without immediate proof points. Volz also highlights the need for storytelling in hard tech industries, where traditional software metrics don't apply, and underscores the significance of progress in people, product, and traction to attract investors. (02:58:00) - 𝕏 Timeline Reactions TBPN.com is made possible by: Ramp - https://Ramp.com https://ramp.com/ AppLovin - https://axon.ai https://axon.ai/ Cisco - https://www.cisco.com https://www.cisco.com/ Cognition - https://cognition.ai https://cognition.ai/ Console - https://console.com https://console.com/ CrowdStrike - https://crowdstrike.com https://crowdstrike.com/ ElevenLabs - https://elevenlabs.io https://elevenlabs.io/ Figma - https://figma.com https://figma.com/ Fin - https://fin.ai https://fin.ai/ Gemini - https://gemini.google.com https://gemini.google.com/ Graphite - https://graphite.com https://graphite.com/ Gusto - https://gusto.com/tbpn Kalshi - https://kalshi.com https://kalshi.com/ Labelbox - https://labelbox.com https://labelbox.com/ Lambda - https://lambda.ai Linear - https://linear.app https://linear.app/ MongoDB - https://mongodb.com https://mongodb.com/ NYSE - https://nyse.com https://nyse.com/ Okta - https://www.okta.com https://www.okta.com/ Phantom - https://phantom.com/cash Plaid - https://plaid.com https://plaid.com/ Public - https://public.com https://public.com/ Railway - https://railway.com https://railway.com/ Restream - https://restream.io https://restream.io/ Sentry - https://sentry.io https://sentry.io/ Shopify - https://shopify.com/tbpn Turbopuffer - https://turbopuffer.com https://turbopuffer.com/ Vanta - https://vanta.com https://vanta.com/ Vibe - https://vibe.co Follow TBPN: https://TBPN.com https://x.com/tbpn https://open.spotify.com/show/2L6WMqY3GUPCGBD0dX6p00?si=674252d53acf4231 https://podcasts.apple.com/us/podcast/technology-brothers/id1772360235 https://www.youtube.com/@TBPNLive

Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

• 0:00John Coogan?

  You're watching TVPN. Today is Monday, March 9th. We are live from the TVPN UltraDome. Temple of Technology, Fortune's Finance, Ramp.com, Time is Money, Safeway, Business Cards, Bill Pay, Accounting, and a whole lot more, all in one place. We have a fantastic show. We were able to get Alex Epstein to come down to the UltraDome in person on short notice to get us up to speed on what's happening in the oil markets. Of course, oil is all, it's, uh, it's gushing all over the timeline, all over the Financial Times, all over the Wall Street Journal, uh, as part of the

• 0:33Jordi Hays?

  And Alex had a feeling that oil would be important in the future when he wrote the book Fossil Future.

• 0:39John Coogan?

  Yes, which we have right here, uh, which if you haven't given it a read, go pick a copy up, uh, and stay tuned for him joining us at 110 today. Let's pull up Linear lineup and tell you who we have coming on the show today. Linear, of course, is the system for modern software development. 70% of enterprise workspaces on Linear are using agents now.

• 0:58Jordi Hays?

  We have Dr. Alex Whistler Gross, uh, over on Eon Systems. He went very viral over the weekend for connecting a biologically derived fruit fly connectum to a Mujiuco physics simulated body. Uh, and, uh, we're going to be talking all about simulating fruit flies and what will come after that.

• 1:25John Coogan?

  And we're also going over Microsoft Copilot, Cowork, Julian.

• 1:29Jordi Hays?

  Which we're going to call Sequoia.

• 1:30John Coogan?

  Coco, okay. Uh, Disney might like a word. They have IP in that space in particular, but we'll see.

• 1:36Jordi Hays?

  But do they have it in the enterprise?

• 1:37John Coogan?

  I don't think so. Um, uh, Julian's joining from Sequoia Capital. Owen McCabe from, from Intercom, our partner, is joining because they just raised a massive round.

• 1:48Jordi Hays?

  Cleaned 250.

• 1:49John Coogan?

  And Michelle Voels is launching Pax VC. She's, uh, she left Andreessen Horowitz, I think about a year ago, and has been, uh, is now launching a new early-stage fund. Uh, anyway, let's go through the timeline and see how people are processing the news of the straight of Hormuz and the oil price spikes. Uh, we

• 2:06Jordi Hays?

  Fox News this morning, they were saying just basically their advice to the, to the captains was the man up. And just send it.

• 2:16John Coogan?

  Yeah, send it, send it. That seems crazy.

• 2:18Jordi Hays?

  Effectively their advice. I'll read the.

• 2:20John Coogan?

  Please stay safe.

• 2:22Jordi Hays?

  I'll read the actual quote. A guy, Brian, said, "If you want to diminish the Iranian threat, if you want to make sure this ends with complete capitulation, show some guts and go through that straight."

• 2:33John Coogan?

  That seems very, very risky right now. Stay safe out there if you are on a shipping vessel. Do whatever is responsible. There are some crazy twists happening. So apparently ships in the Gulf are declaring themselves as Chinese vessels to dodge attack. This is from the Financial, the Financial Times. "At least 10 vessels have changed transponder messages in an apparent attempt to avoid becoming targets. A clutch of vessels trapped in the Gulf under enemy fire are adopting a tried and tested ruse to avoid attacks. They're changing flags, using transponders to declare themselves to be Chinese." There's, there's always been a very odd, like, just like tug of war between how ships

• 3:18John Coogan?

  identify themselves because often for tax reasons, they're bought in one country, operated by individuals from another company, but they fly a different flag to be able to go from one place to another. And it's all based on like the port systems. I don't fully understand it, but it is very interesting. At least 10 ships over the past week have altered their destination signal to read Chinese owner, all Chinese crew, or Chinese crew on board. About 1,000 ships are currently shut inside the Gulf and its immediate surroundings with a cumulative value of $25 billion.

• 3:47Jordi Hays?

  And I don't know, I don't know if you've seen some of the, the maps that show the strait where it, it looks like nothing is actually moving through.

• 3:54John Coogan?

  Yeah.

• 3:55Jordi Hays?

  I think in actuality, a number of the ships are actually turning off their transponders.

• 3:59John Coogan?

  Oh.

• 3:59Jordi Hays?

  So you can't see the movement.

• 4:01John Coogan?

  Yeah.

• 4:02Jordi Hays?

  Uh, because they're basically moving a little bit, going through the strait. And then, uh, turning back on again.

• 4:07John Coogan?

  Well, there are, there are plenty of, uh, outlets that are covering the, uh, the Iran conflict in detail. Um, we of course will be focused on the, the business and technology impacts. I wrote about, uh, what oil, uh, what, what oil prices mean for the AI build out and data centers. It's just sort of interesting to dig into the deeper supply chain of artificial intelligence.

• 4:29John Coogan?

  But there are some posts that we should go through around the oil story. So crude oil is five standard deviations above its 50-day moving average. Statistically speaking, this occurs every 9,500 years. So the last time would have been about 6,000 years before Moses parted the Red Sea. Imagine what that did to shipping in the area. Fancyful. What else is going on? Kobe SC, the Kobe SC letter has been posting a lot about oil prices. U.S. oil prices are now expected to rise above $100 a barrel this month. That already happened. This was posted on March 6th with markets pricing a 66% chance that it happens. The last time oil prices were above 100 was July of 2022.

• 5:12Jordi Hays?

  Let's pull up this clip from Landman.

• 5:13John Coogan?

  I haven't seen Landman. Have you watched it? Is it good? Let's, uh...

• 5:17Speaker 02

  Well, you want oil to live above 60 but below 90. And don't get me wrong, we're still printing money at 90, but gas gets up over 350 a gallon, it starts to pinch. It hits 100, every product in America has to readjust its price. $78 a barrel, that's about perfect. It brings enough profit to keep exploring, but it don't sting as much to pump. Unless, of course, you're in California. I mean, they tax the shit out of it out there. It could be $45 a barrel, and it's still $4 to pump. I don't know how those son of bitches do it out there.

• 5:51John Coogan?

  It's Movida.

• 5:52Speaker 02

  2020.

• 5:53John Coogan?

  TVN again.

• 5:54Speaker 02

  A barrel of oil is worthless. This place became a ghost town. And nobody's immune. Kids have to quit college. Trucks get sold or repoed.

• 6:06Jordi Hays?

  We can pause it now. We got, we got the gist of it.

• 6:09John Coogan?

  Yeah. Well, this is the largest...

• 6:11Jordi Hays?

  Dude, how, how old were you when you discovered that gas is really expensive in California? Not just because there's a lot of demand for it out here.

• 6:18John Coogan?

  I mean, I discovered it when I was filling up in Montana, and it was like $2 a gallon, and it's like $5 a gallon here. That was pretty wild. The, the first major gas price shock that I noticed was Hurricane Katrina in my life. I think it was in high school. Because I was too young.

• 6:34Jordi Hays?

  I was talking about, I was talking about just the fact, realizing that it's so expensive because of the taxes that California puts on it.

• 6:41John Coogan?

  Yeah, because it's nice to drive around here. Put the top down, the weather's good. So they're like, yeah, you're gonna pay, you're gonna pay more for the joys of driving and a, an internal combustion engine car. No, the price in California is is aggressive. I don't know the structure of the prices, though. Is it percentage based or fixed? Because that affects how much the price will move based on oil price shocks. So because if the price per barrel doubles, but the but the tax is flat, you don't feel it as much here as you do other places. So I don't know. Anyway.

• 7:17Jordi Hays?

  I'm pulling it up, but you can run through.

• 7:18John Coogan?

  It's the largest supply shock by a factor of four. So the Hormuz blockade, which is current, 20 million barrels were lost in supply. The Iranian revolution in 1978 was 5.6 million. The Yom Kippur War embargoes in 73 was 4.4. The Iraq Kuwait War was 4.3 in 1990. The Iran Iraq War in 1980 was 4.0. And the Ukraine Russia invasion in 2022, which is the last time that oil spiked over $100 a barrel, was 1 to 3. So an absolutely huge supply shock, and I'm sure we'll have a lot of implications all over the economy.

• 7:59John Coogan?

  With triple digit prices, here's what's going to happen now, says Policy Tensor. Markets will scream when they open tomorrow. VIX will surge to levels beyond what we saw in April. The sell off will continue for some time as intermediaries shed risk. And the markets are red. They have been screaming today. The VIX futures curve already has inverted, bid up by dealers looking for insurance. This predicts a massive sell off. The pressure on this captured White House now, the pressure on this captured White House now beings in earnest, that's kind of sort of oddly written. Anyone can tell them that if this persists for very long, it will destroy the Trump presidency and gut the GOP for a generation.

• 8:42John Coogan?

  The controlling factor here, as I have told you over and over again, is that the United States does not have the military means to reopen Hormuz. There's no military solution in sight. This means that not only does Iran have the strategic upper hand now, it means that Iran enjoys the unambiguous strategic advantage. All they need to do is keep the thing closed until he capitulates. I put my neck out far to call this in advance. And someone told him yesterday I was in the minority, perhaps even a minority of one. No longer. I was correct. Just calling a shot. The blob heads and scribes were incorrect in their assessment of the strategic situation and now markets will price to reflect reality. And we were,

• 9:23John Coogan?

  we briefly touched on Scott Sumner's blog post on Substack at the end of Thursday's show, maybe Friday's show. We didn't get a chance to read it. I actually read through it earlier today. It's pretty interesting. It basically makes the case, you know, it has a very controversial tendency to freak out. And, and, and the, and the thought is that like he's doom posting, maybe it's about AI, maybe it's about this particular conflict. He is more just reflecting on this dynamic between when the market freaks out, it acts as a moderating effect to policy. And so he gives a number of examples around like tariffs.

• 9:58Jordi Hays?

  Or more specifically, the admin.

• 10:00John Coogan?

  Yeah, yeah. Like, like, like the tariffs caused this massive circuit breaker, 5% sell off in the market. And then that was internalized and, and very quickly adjusted. And there were a whole bunch of different carve outs to sort of like create soft landings. And so he's actually, and what he's getting at is that after the fact, a lot of people say, look, you didn't need to freak out because the taco happened. Trump always chickens out. The, the, the actual proposed policy effect didn't go into, didn't go into effect. And his point is that, well, it's precisely because people freaked out that it didn't go into effect. So freaking out is good in Scott Sumner's mind, at least. Anyway, I love this.

• 10:40Jordi Hays?

  Yeah, we have a solution.

• 10:42John Coogan?

  We have a solution. If, if you're feeling the pain at the pump, pivot and get a horse. At oil at 110, the urban horse is the only option. Pulling up to the gas station on a horse is, is truly elite. I, I do want to know, what's the TCO on a horse with the food and the stables versus, you know, just keeping a, what is that, a Ford Taurus in your, I don't know, that's something else. You know, in your garage. The horse really mogs at the, at the gas station in particular, right? Because it's just making everyone feel so stupid.

• 11:17Jordi Hays?

  It really does.

• 11:18John Coogan?

  Yeah, we got to go back. One horsepower is all you need. Nick Carter says, seeing a lot of non-processed trusting panic-ins on the TL.

• 11:31John Coogan?

  And then he followed up by saying, that's what I thought because the oil prices spiked up and then they fell down and we did not get $120 a barrel oil. We got exactly 100, which was still-

• 11:43Jordi Hays?

  It's not like it's way, way, way too early to celebrate or anything.

• 11:47John Coogan?

  Yeah, exactly. There's an interesting chart here, a really shocking chart from Oliver Grobe, unreal numbers about Germany's nuclear power generation. So if you scroll down, look at this curve. This is truly the bell curve meme or something like that. JP Morgan estimates that had Germany not phased out nuclear power, the country would have generated 50% less electricity from fossil fuels and 84% less electricity from natural gas in 2024. Electricity prices in Germany would have been around 25% lower and the country would have imported half as much electricity. And just complete rise and fall of nuclear

• 12:31John Coogan?

  power generation in Germany. One of the craziest graphs. You don't see graphs like that very often in new technologies. Typically, you see S-curves or you see exponentials. No one considers the models get better and then they get dumber. That's certainly the funniest outcome.

• 12:47Jordi Hays?

  Yeah.

• 12:48John Coogan?

  Very, very rough. Goldman Sachs sent a note to investors saying, if oil prices increased by $10 and remain elevated for three months, US year-over-year headline CPI inflation would likely rise from 2.4% in January to 3% in May. Those are small numbers, but we're looking at a oil price increase of maybe $30, $40 over the baseline, potentially higher. We don't know where oil's gonna land. And so you have this weird tug-of-war right now with the Fed where if oil prices go up, inflation goes up, the Fed has a mandate to curb inflation. That means higher interest rates. At a time when the labor market is

• 13:29John Coogan?

  shedding jobs, you would expect a Fed rate cut or a lot of people are- Optimistic about a rate cut. Trump certainly wants rate cuts. But if inflation is climbing, there's really no solution other than keeping rates high or even raising them further. So a real jam in terms of federal monetary policy, Fed monetary policy. Here's Art Cashin at the opening bell. This is a historical video. When was this? This was a long time ago. Let's play this clip.

• 14:01Speaker 03

  This may be it. First, let me start out, moratorium salut Thomas essay. And you know, that's the Gladiator salute. We who are about to die salute you. So it's going to be a tough morning. This may be it.

• 14:14John Coogan?

  We who are about to die.

• 14:17Jordi Hays?

  Salute you.

• 14:18John Coogan?

  Insane, insane aura for, you know, CNBC really doesn't get enough credit for being so innovative in terms of broadcasting and entertainment. Really, some of the, some of the greatest clips.

• 14:29Jordi Hays?

  I love one of the, one of the top comments. This is an old clip.

• 14:33John Coogan?

  Obviously.

• 14:34Jordi Hays?

  Brother.

• 14:35John Coogan?

  480p. It's probably from the 90s. So Zero Hedge says, you know, with oil at 111, total panic. And Memetic Sissavas shares a clip that says, half of this site for the last week has sounded like this. Let's.

• 14:50Speaker 04

  Producers are telling me there is breaking news. The Asian financial markets have just opened to a huge sell off. And we're going to switch to that story right now. Good. I'm glad I'm here. Your thoughts, Tracy Jordan, on how this is going to impact Wall Street? Larry, I'm not an expert, but I do have a strong opinion. New York as we know it will no longer exist tomorrow. Producers are telling me there is.

• 15:17John Coogan?

  Is this from 30 Rock? That's so good.

• 15:21John Coogan?

  That's so funny. Oil came way, came way in from its overnight highs, says Joe Weisenthal. The quote post is, Chris Paul.

• 15:31Jordi Hays?

  Hits a huge three to cut down the lead to 42.

• 15:35John Coogan?

  Absolutely, absolutely brutal. So, uh, let me tell you about Gusto, the unified platform for payroll benefits and HR built to evolve with smodern mall and sm- with modern, small and medium sized businesses. Stop making fun of me.

• 15:49Jordi Hays?

  We're somewhat of a smodern business. We're small and modern.

• 15:52John Coogan?

  Small and modern, smodern. Let me also tell you about CrowdStrike. Your business is AI, their business is securing it. CrowdStrike secures AI and stops breaches. So.

• 16:01Jordi Hays?

  Uh, we gotta give you the shout out to George Kurtz for, uh, the Mercedes performance yesterday.

• 16:06John Coogan?

  Oh, yeah.

• 16:07Jordi Hays?

  One, two, one, two.

• 16:08John Coogan?

  Really good. George Kurtz on that.

• 16:10Jordi Hays?

  Would you look at that? Takes a stake in the team. Suddenly they're at the top.

• 16:13John Coogan?

  Yeah, he's on to something. Um, well, uh, the, uh, my essay this morning was titled, "Why Is No One Talking About Oil?" Uh, of course, everyone is talking about oil. Uh, oil discourse gushed onto the timeline this weekend. Uh, and crude prices spiked to nearly a hundred and twenty dollars a barrel as a broadening war in Iran threatens both transportation routes and production. The geopolitical and economic analyses are flowing, but what does this mean for AGI timelines? And a lot of people in, in the AI world are sort of tuning all of this out because they see recursive self-improvement, AGI, ASI, the build out as more important. And I just wanted to sort of reality check the AI supply chain to understand

• 16:55John Coogan?

  how does oil actually affect data center construction, AI production, token pricing? Like, is there any effect? My conclusion was that it's, it's very moderate, but there are some interesting effects in the financial markets that are probably the bigger takeaway. But it's still interesting to hear about, like, yes, oil actually does, is used in the production of AI, at least a little bit. Um, so, uh, power has been at the forefront of the AI pushback. Like, everyone's worried about these local energy prices, these electricity prices increasing near the data centers. But, and it's been, it's been, become like a political issue, but. Pain at the pump might become a bigger story as gasoline prices spike. And that has been pain at the pump.

• 17:39John Coogan?

  Oh, it's been the most tangible sign of inflation. It moves so quickly. You know, one, one jitter in the economy.

• 17:47Jordi Hays?

  And it's a huge component. You know, people on the coast, people in tech don't have a good sense for this, right? Gas, gas, for a lot of people, gas could quadruple. And it wouldn't, they wouldn't really notice it.

• 17:58John Coogan?

  No, no.

• 17:59Jordi Hays?

  But if you actually look into the average American, how gasoline fits into their budget. It's a meaningful component of their monthly budget. So they feel it super intensely. And. It's variable.

• 18:10John Coogan?

  Yeah.

• 18:11Jordi Hays?

  Costs.

• 18:11John Coogan?

  There are, there are so many different ways where a lot of Americans go on driving vacations. That obviously is directly impacted by gas prices. And then also just psychologically, there's, there's something about filling up at the gas tank where you see the number ticking up and you're doing that on a every week basis or so. And it's just so visceral. It's this thing that you have to stop and then go experience and watch the money flow out of your account like in real time. It's very, it's very visual. It's very interactive.

• 18:40Jordi Hays?

  Yeah, I remember, I remember I, I must've been probably 18 at this point where I would just go and I would like, for a long time, I just put, I'd like, you know, prepay for a certain amount of gas.

• 18:51John Coogan?

  I got 20 bucks. Let's see how much I got.

• 18:53Jordi Hays?

  And I felt like really, like I felt like the king of the castle. Exactly. I just put my card down and let it run up.

• 18:58John Coogan?

  Yeah, yeah, yeah, yeah.

• 18:59Jordi Hays?

  How far it'd go.

• 19:00John Coogan?

  No, no, totally. So pain of the pump's been like a big, broad economic issue. It's so visceral, like the actual phrase has a lot of power in politics and in like attack ads, like your, your gas prices are going up under this person. That's why you gotta vote for me. This is, this is common. But in AI circles, the discussion's been much more focused on RSI now is the new acronym that everyone's focusing on, not AGI. AGI is here, we know, artificial general intelligence. We passed the Turing test. The models can do things generally intelligently. But can they recursively self-improve? Are they RSI? Are we in RSI now? Is it a coming? Is this going to be a fast takeoff? Is this going to be a slow takeoff?

• 19:45John Coogan?

  Well, something's taken off. Dylan Patel said, being in SF is like being in Wuhan right before the pandemic. Something is happening, it's going to hit everywhere, but so few people know it. So he's sort of echoing that something big is happening mentality. This idea of like recursive self-improvement, being AGI-pilled. Lot of, a lot of smart people agree, there's definitely something happening. There's still this question of like, what is sticky? What, where will diffusion take longer? What will be sort of AGI-resistant or ASI-resistant for a variety of reasons? Even if they're completely irrational and you could get a better thing from a computer, but people like the human version or whatever.

• 20:27Jordi Hays?

  The irony is that, that George Hart's hitting the timeline to raise money.

• 20:34John Coogan?

  Yeah.

• 20:34Jordi Hays?

  Makes me more bullish on acceleration.

• 20:37John Coogan?

  Yeah.

• 20:37Jordi Hays?

  Right? Because if not, he's obviously not historically been a huge fan of venture, venture capitalists.

• 20:44John Coogan?

  Well, he's not raising from traditional VCs, he said. He, he specifically said he wants to raise from like, like basically like friends and family type of round. He does want 20 million. We have this in the timeline somewhere. Where is this post from George?

• 20:57Jordi Hays?

  I'll pull it up if you want to keep.

• 20:59John Coogan?

  At Tiny Corp. He said that he's raising $20 million to buy a building. He's, but he's going to buy a building. Here it is. If, so he said, this is from Tiny Corp. The makers of Tiny Grad and the Tiny Box. If Tiny Corp was raising $20 million at $200 million valuation, who'd be interested? Business model is basically this. Buy an $11.5 million building with five megawatts of power. Link in our Discord. Wait for AMD to launch the RDNA 596 gigabyte cards mid 2027. Pre-order 3,000 cards. Hopefully we can negotiate for $2,500 each.

• 21:38John Coogan?

  Build 520,000 tiny boxes with six of the cards in, in each box. Run all the Chinese LLMs. Make $600,000 per month revenue selling tokens on OpenRouter. Market depth is there. This is 1% of OpenRouter. Improvements to Tiny Grad yield revenue. Improvements due to how power is priced in Oregon. It's only like $50,000 for the electric bill before the four megawatts before they price for peak, not usage. We get like 3C kilowatt hour power, three cents per kilowatt hour. We can also make $100,000 per month leasing colocation space to comma. Building and cards paid off in three years max and investment made back.

• 22:22John Coogan?

  Low risk of being undercut since we're using consumer GPUs and running the cheapest colo you can believe. If someone chill wants in, I do it. I'm not gonna fake hype. I'm not gonna hype fake tech, but demand for tokens is gonna skyrocket. Look at the open claw install numbers with crazy good optimizations. We could potentially get 3X more from the machines and we have electricity for 3X more machines. 5.4 revenue per month, then continue to scale from there, custom chips, et cetera. He's starting a NeoCloud. Are you starting a... Yeah, he's gonna be serving tokens. So that was, that was incredibly bullish. Demand is definitely there. At the same time, he sort of took the other side of like, this is different. This is crazy.

• 23:06John Coogan?

  He says, there's no AGI. There's no magic threshold. You guys see auto research change the random seed from 42 to 137 and OMG, it's AGI, it's over. Yet you critique the junior engineer for the same stuff. The cost of development is falling. Overpaid engineering struggles to compete. That's the story. And he says humanity has been recursively self-improving for centuries. So everything new is old.

• 23:32Jordi Hays?

  I don't know. I obviously have a huge amount of respect for George, but at the same time, saying there is no artificial general intelligence when you're also arguing that engineers are struggling to compete with new technology that is replacing them.

• 23:49Jordi Hays?

  This is, how is this not

• 23:51John Coogan?

  Yeah.

• 23:51Jordi Hays?

  Artificial intelligence competing with?

• 23:54John Coogan?

  Yeah, so, so I think he is, he is agreeing with that, but it's that, it's that there is an immense amount of, of desire for this binary moment. This is the singular.

• 24:06Jordi Hays?

  Yeah.

• 24:06John Coogan?

  This is AGI, this is ASI, the RSI is here. This thing is happening right now and there's before and after and everything has changed. And, and, and he just doesn't see it that way, I think. I think he sees it much more like the internet, the mobile phone, like other technologies that have been rolled out.

• 24:21Jordi Hays?

  Continuum.

• 24:22John Coogan?

  Electricity, yes, there is like a before and after, but you can only really, you know, define the period by maybe a decade and you need a few decades to understand that moment. It's very hard to go back and, you know, there is like the iPhone moment and there is like, you know, the first launch of, I don't know, AOL. Like, I don't even know, I don't even know what the iPhone moment of the internet was, just because it was sort of a slow rollout. Anyway, uh, live GPU clusters. Um, where's Jordy going? Oh, you're moving the goalposts, okay. Jordy's moving the goalposts. Where are you moving the goalposts to?

• 24:55Jordi Hays?

  Just over here.

• 24:56John Coogan?

  Okay, but why? Is there a reason?

• 24:59Jordi Hays?

  Well, I mean, they have to be moved. George is moving the goalposts.

• 25:01John Coogan?

  Oh, okay, okay, okay. He's moving the goalposts. Uh, so I said, uh, you know, i- it's clear that the AI industry continues to grow and continues to need more and more power and compute, as we've seen from George Hatz's new project. Uh, that means large data center campuses. Uh, but if they're not in, uh, random office buildings that George is picking up for, on the cheap, uh, they're probably going to be built with construction equipment. So what does this mean? They, they don't just drop from the heavens. Uh, they require building, which requires oil, but how much oil? And is oil a serious, in, is a serious oil shock enough to impact the AI build out in a meaningful way?

• 25:40John Coogan?

  Spoiler, basically no. But live GPU clusters in the United States do not use much oil directly. Only 0.6% of US electricity in 2024 came from petroleum. We're much, much more dependent on natural gas, something like 42% of US electricity is natural gas. And so, America ramped up natural gas production significantly over the past two decades. A lot of that was in reaction to the wars in the Middle East. Hey, we need to be less dependent on foreign oil. We need to be energy independent. And so you have the fracking boom, the natural gas boom. And that's where a lot of our fossil fuels come from today, I believe.

• 26:23John Coogan?

  Data centers only consume a single-digit percent of US electricity. So you're looking at 0.6% of a few percent is like the actual impact. So the short-term impact of high oil prices should be very limited on AI. Building out new capacity is much more expensive.

• 26:39Jordi Hays?

  That's worth noting. I think it's something like Qatar produces something like 20% of the world's liquefied natural gas, right?

• 26:48John Coogan?

  But not for us.

• 26:49Jordi Hays?

  Yeah, not for us. So we're in a good spot. But this is going to impact the data center build-outs or active data centers across the rest of the world if this continues.

• 27:01John Coogan?

  Yeah. So when you're talking about building new capacity, building new data centers, oil is a little bit more involved. So diesel powers trucks, trains, boats, barges, generators, pumps, compressors, excavators, and tons more construction equipment.

• 27:20John Coogan?

  Petroleum is also broadly used for plastics, polyurethane, and solvents that all work their way into the data center supply chain. The biggest problem is delaying already tight schedules because of narrowly available components going out of stock.

• 27:35John Coogan?

  The price of oil goes up, there's one marginal factory that can't produce one ingredient that goes into the rack and that slows things down. You have to wait a week while you find another supplier. That stuff can add up to just a little bit of a delay. This happened during COVID and the AI industry was already experiencing something similar with transformers. And so you don't want products getting stuck in transit or going out of stock. But the bigger problem and the one that people should be talking about, and I think you were debating with Dan Primack at Axios about this, is macroeconomics. So higher prices, higher oil prices lead to higher inflation. If the Fed has to raise rates to control inflation, capital formation for mega projects gets a lot harder. So JLL has this estimate, the

• 28:15John Coogan?

  next 100 gigawatts of data center capacity could require about $870 billion of new debt financing. And so using this rough number, every extra 50 basis points of borrowing cost on 870 billion is 4.35 billion in annual interest expense. And so that's, I don't know if that's a huge squeeze on cash flow, but it's certainly a squeeze on cash flow if you're a hyperscaler and you're going gig along AI capex now and you're like, yeah, we're going to do 200 billion this year, we're going to do 500 billion next year or whatever across a couple of companies. You start looking at interest expense bills that

• 28:57John Coogan?

  are already huge, but then they're going to go up by 5 billion or up by a full more, a full extra billion, just with a 50% basis, 50 basis point increase, half a percent. So half a percent change in the Fed funds rate can echo through. Even a quarter percent could probably, could probably be amplified into, you know, a multi-billion dollar, like cost line on your, on your balance sheet or on your income statement as you're servicing that debt. Overall, higher oil prices do make the AI rollout harder, but not really for existing AI capacity. I wouldn't expect Token pricing to change based on the price of oil. But there is this more, there's this bigger question of macroeconomic resilience during a time where our largest tech companies are digging through the couch cushions to find

• 29:40John Coogan?

  every penny to win the AI future. Middle Eastern investors pulling back, I agree with you. I do think that this is a significant risk because if they pull back on big investments, makes these mega rounds more difficult. Retail investors could fly to oil stocks or defense stocks if they think that this is like going to be a thing for months and months and months. It could all flip if there's a quick resolution though, which is what I'm hoping for. But if things continue, the AI industry walks in even tighter tight rope.

• 30:07Jordi Hays?

  Yeah, I mean, the, the big question right now is the hundreds of billions of dollars of, of sovereign AI projects in the Middle East, right? I think a lot of those people are going to be like, eh, do we want to send, you know, billions of dollars of GPUs?

• 30:21John Coogan?

  Over there and then also the money coming here is another thing where you might want to spend it elsewhere. Quickly, let me tell you about Turmoil Puffer, serverless vector and full tech surge, built from first principles and object storage, fast, 10x cheaper and extremely scalable. And let me also tell you about public investing for those who take it seriously. Stocks, options, bonds, crypto, treasuries and more with great customer service, whatever your investing strategy is.

• 30:41Jordi Hays?

  And we have to say happy to birthday, happy birthday to Trey.

• 30:44John Coogan?

  Happy birthday Trey.

• 30:45Jordi Hays?

  We love you.

• 30:46John Coogan?

  Very excited to have you. Thank you.

• 30:48Jordi Hays?

  One of our strongest soldiers.

• 30:49John Coogan?

  We appreciate you.

• 30:50Jordi Hays?

  It's been an honor.

• 30:51John Coogan?

  And have you been noticing that it's been hotter in Los Angeles?

• 30:54Jordi Hays?

  I have.

• 30:55John Coogan?

  Downtown Los Angeles is forecasted to approach 100 degrees Fahrenheit on Thursday and Friday in March.

• 31:03Jordi Hays?

  Which is why.

• 31:04John Coogan?

  Not good.

• 31:05Jordi Hays?

  We're going to do the weather. New segment for you today. We're doing the weather on TBPN. We have our very own Ben.

• 31:12John Coogan?

  We have Ben.

• 31:13Speaker 05

  Hello, guys. How are you?

• 31:15John Coogan?

  We're doing great. Tell us about the weather.

• 31:17Jordi Hays?

  What's happening?

• 31:18Speaker 05

  Well, I want to start off by saying, as you can see, the weather today for the low, low of today is going to be 75 degrees Fahrenheit up there, high of 100 degrees Fahrenheit down there. But there's something I actually wanted to point out that I saw and I thought that was quite interesting. As you can see up here, there's a localized low-pressure area up there and a localized high-pressure area right down there, if you can see that right there.

• 31:37John Coogan?

  Does that mean rain?

• 31:38Speaker 05

  The issue, that's not normally an issue and not a cause for concern, and it's not very common for this time of the year. However, today, later in the afternoon, these two areas are going to collide, and they're going to hit each other.

• 31:47John Coogan?

  Really?

• 31:48Speaker 05

  And what that's going to cause is a barometric pressure inversion.

• 31:51John Coogan?

  Okay.

• 31:52Speaker 05

  It might sound a little bit scary, but I guarantee there's no cause for concern. All that means is that hot air rushing in from the west is going to collide with that cold air rushing in from the east, and it's going to cause a bunch of turbulence in the sky, moving all the airwaves around and oscillations in the sky. However, I want to add one more point. A byproduct of this effect is that all that humidity that dropped after that hot air moved to the bottom is going to raise up because of the water cycle, you know, evaporation and stuff. It's going to raise up into the sky, into those clouds, it's going to cause big clouds in the sky, and eventually, all that water's going to fall down onto the ground. We're going to have a big rain later in the afternoon.

• 32:25John Coogan?

  Wait, it's actually going to rain in LA?

• 32:29Speaker 05

  Yeah, it might sound crazy, but I just want it for all you guys at home, I definitely tried to step outside with a jacket today, maybe a hoodie, just in case the rain comes. Don't try to be a big shot.

• 32:37John Coogan?

  I'm fact-checking you right now, and the weather app says it's going to be sunny all week. Is this just complete fake news?

• 32:45Speaker 05

  My team, those are the numbers my team gave me.

• 32:47John Coogan?

  This is complete fake news.

• 32:48Speaker 05

  No, no, no, no.

• 32:49John Coogan?

  This is the fakest news I've ever heard.

• 32:51Speaker 05

  No, no.

• 32:52John Coogan?

  Literally.

• 32:53Jordi Hays?

  John, John, I don't trust your app, I trust the weather.

• 32:58John Coogan?

  Apple says it's not going to rain the entire month. There's zero chance of rain.

• 33:04Speaker 05

  Did you look at the transatlantic current?

• 33:05John Coogan?

  No. Precipitation, zero inches today, zero inches tomorrow, zero inches on Wednesday.

• 33:11Jordi Hays?

  John, you're really going to, you're really going to trust an app, you're really going to trust an application that was probably vibe-coded yesterday over Ben, who's doing the weather.

• 33:22John Coogan?

  How did he get here? What happened here?

• 33:24Speaker 05

  Yeah, I got a, no. If you look right there, you can see a localized high-pressure area, that's a localized high turbulence.

• 33:30John Coogan?

  This is an over-eager weatherman who's just looking for drama in the most boring weather market in America, which is Los Angeles.

• 33:36Jordi Hays?

  I think, I think this is the most important story in the world.

• 33:41John Coogan?

  This is ridiculous.

• 33:42Speaker 05

  You guys can look at the jet streams, they're coming in from the west.

• 33:43John Coogan?

  I don't want to hear any more mumbo jumbo about jet streams, get out of here. You're done.

• 33:48Jordi Hays?

  Great work, Ben.

• 33:49John Coogan?

  Thank you, Ben. The fake news weather will return, maybe never, who knows? Let me tell you about Restream, one livestream, 30+ destinations. If you want to multi-stream, go to Restream.com. And let me also tell you about Gemini 3.1 Pro. With a more capable baseline, it's great for super complex tasks like visualizing difficult concepts, synthesizing data into a single view, or bringing creative projects to life.

• 34:13Jordi Hays?

  This is the future of the weather. You have a weatherman who gets into a live altercation with one of the other hosts, who's just constantly fact-checking.

• 34:21John Coogan?

  It's on-site, next time, Ben. It's on-site. If you pull up with some fake news on TVPN's weather report, it's on-site.

• 34:28Jordi Hays?

  Ben, you crushed it.

• 34:30John Coogan?

  Good job. So, it is, it's not Adam Smith's birthday, it's the 25th anniversary of the publication, 250th, sorry, 250th anniversary of the publication of The Wealth of Nations. Tyler, you have a copy?

• 34:46Speaker 06

  I have two of our copies here. I didn't bring, so, yeah, usually I have one with me, but I didn't bring one to work because we have a, we have a few here.

• 34:52John Coogan?

  Yeah, yeah, yeah, yeah, obviously. For those who don't know, give us the pitch for Wealth of Nations. Why should people read Wealth of Nations in 2026?

• 35:01Speaker 06

  Yeah, I mean, this is kind of the OG, you know, economics book, right?

• 35:05Jordi Hays?

  It was, it was, like, put it into, like, AI terms. This is, like, situational awareness type of, or not that specific.

• 35:12Speaker 06

  This is, like, attention is all you need.

• 35:13John Coogan?

  It was like the ChatGPT moment for capitalism.

• 35:16Speaker 06

  Yes, yes. But I would like to, you know, I have a few quotes I would like to read.

• 35:21John Coogan?

  Okay.

• 35:21Speaker 06

  All right, let me open them.

• 35:24John Coogan?

  Let's see. It's a big book. It's like 800 pages.

• 35:27Speaker 06

  It's very long.

• 35:27John Coogan?

  And it's really, really dry. I mean, it reads like it was written 250 years ago.

• 35:32Speaker 06

  Okay, so this is, I think this is kind of one of my favorite quotes.

• 35:34John Coogan?

  Yeah.

• 35:35Speaker 06

  Kind of the, you know, seminal. "Every individual necessarily labors to render the annual revenue of the society as great as he can. He generally, indeed, neither intends to promote the public interest..." Nor knows how much he is promoting it.

• 35:49John Coogan?

  Yes.

• 35:51Speaker 06

  He intends only his own gain.

• 35:53John Coogan?

  Yes.

• 35:54Speaker 06

  And he is in this, as in many other cases, led by an invisible hand to promote an end which was no part of his intention.

• 36:01John Coogan?

  Yeah. Rational economic actors, homo economicus, thinking of the value for societies created by rational self-interest. And he's sort of this spin on like greed is good. It was like, he was like an OG of that, of that thesis.

• 36:17Speaker 06

  A greed Maxer.

• 36:17John Coogan?

  Uh, yeah, productive labor, efficient markets, free markets, don't hold gold, don't control trade. An important read in 2026. Somewhat heretical. There are many people that disregard that book. Maybe they should not. Maybe they should give it a crack.

• 36:32Speaker 06

  Evergreen.

• 36:33John Coogan?

  I think it's evergreen. I think it's evergreen. I mean, there was that debate over like Tyler Cowen over the weekend. And somebody was taking shots at Stubborn Attachments for being like not, like not advancing the discipline of economics. And my pushback to that was that I actually think it is incredibly, it's just a fun read. It's like really well-written and it's very entertaining and it's very thoughtful. But it's particularly interesting to hear someone sort of just rehash the tenets of liberal democratic capitalism in 2020. I think he read it in 2023, 2022, something like that. But like, like there, there, there are a lot of voices out there who are anti-capitalist,

• 37:16John Coogan?

  anti-democratic, anti-liberal, and Tyler Cowen is just retreating to like a time-tested, time-honored economic philosophy that is deliberately not revolutionary. And I thought that it was a great book for that reason, and that's why I recommend Stubborn Attachments to so many people and so widely. But if you want to crack open the real, the real, the real hard stuff, pick up a copy of The Wealth of Nations. Why is one of those copies so much smaller? Is the font size just smaller?

• 37:52Speaker 06

  Yeah, it's super small. It's also two columns.

• 37:54John Coogan?

  Oh, two columns, wow. Yeah, if you can get through that, you're truly, you're truly elite in the global economy. What does the timeline have to say about the, the master work that is turning 250? It's now needed more than ever, says the Washington Post. On March 9th, 1776, four months before the American colonies broke with Britain over the issue of taxation, a little-known Scottish thinker published a long, dense book with an unpromising title, shots fired. "An Inquiry Into the Nature and Causes of the Wealth of Nations." 250 years later, the Adam Smith is by any objective measure easily the most widely cited and widely quoted economist who ever lived.

• 38:39John Coogan?

  Astonishingly, astonishingly, his work still frames the central questions we face. Not just about free markets, trade, and capitalism, but about the nature of human society itself and even what it is to be human at all. Smith was born in 1723 in Kirkcaldy, Scotland, educated at the universities of Glasgow and Oxford. He initially made his name not as an economist, but as a moral philosopher. His first published book, "The Theory of Moral Sentiments," offered a radical theory of how we form moral judgments. Radical because it derived from the creation of moral values, not from scripture or divine grace, but from human sympathy and mutual regard. "The Wealth of Nations," as his second work, second major work came to be known, was an extension of that product.

• 39:23John Coogan?

  The book is not, as sometimes believed, a hymn to greed, a pain to market fundamentalism, or red-in-the-tooth-claw capitalism. It was an attempt to understand how a commercial society could generate prosperity without collapsing into corruption. This 25th, this 250th anniversary is not a moment for hagiography. It is an opportunity to recover a way of thinking that is directly relevant, indeed urgent, to the economic, social, and political challenges we face today. Begin with trade. In his own time, Smith's great target was mercantilism, or what he called the mercantile system, the idea that wealth consists of hoarded bullion and that trade is a zero-sum contest. Governments granted monopolies, imposed tariffs, and manipulated

• 40:06John Coogan?

  commerce in the purported pursuit of national strength. Producers were widely protected, consumers often ignored altogether. Against this, Smith-

• 40:14Jordi Hays?

  One of these days, we should have Tyler just do a speed reading of The Wealth of Nations live on the show.

• 40:20John Coogan?

  Speed run? Yeah, Wealth of Nations speed run, any percent glitchless. You need to do glitchless, though. For sure, a glitchless run is the only way we can do it. No glitching, no AI summaries. I think that would take you probably five days. Probably five days. It's so dense.

• 40:43Jordi Hays?

  Have you seen how fast he can rip a Rubik's Cube? This edition is 488 pages around.

• 40:47John Coogan?

  Oh, yeah. I guess you don't have to read all the footnotes and stuff. You can kind of skip through it. But it is a thick book. But the way it's written is just really not fun to read. It's like, it reads like it's 250 years old. It's not like a page turner.

• 41:02Jordi Hays?

  Well, we need to talk about the wealth-

• 41:05John Coogan?

  But first, vibe.co. We're DTC brands, B2B startups, and AI companies advertise on streaming TV. Pick channels, target audiences, and measure sales, just like on Meta. And let's also tell you about fin.ai, the number one AI agent for customer service. If you want AI to handle your customer support, go to fin.ai.

• 41:21Jordi Hays?

  We need to talk about the wealth of Sundar Pichai.

• 41:25John Coogan?

  Pitch AI.

• 41:26Jordi Hays?

  His new pay deal worth up to 692 million.

• 41:31John Coogan?

  Is this like 10 times what Tim Cook's making? No, it must be over time, right?

• 41:37Jordi Hays?

  Cook's making around 70 a year.

• 41:40John Coogan?

  70 a year.

• 41:41Jordi Hays?

  Combined.

• 41:42John Coogan?

  So if he works for 10 years, he makes what Sundar makes in three? This is gonna be a conversation.

• 41:47Jordi Hays?

  It is. I mean, but this is what we've been, we've been.

• 41:50John Coogan?

  We've been advocating for this. So this is good. Yeah, no, no, we're, we're, we're, we're in support.

• 41:55Jordi Hays?

  Yeah, Google has increased Sundar's potential pay to 692 million over the next three years.

• 41:59John Coogan?

  You know that Tim Cook dropped this in the Apple board members group chat as soon as it hit. He was just like, dude, this is, this is a cool article. You should read this.

• 42:07Jordi Hays?

  Drops it in.

• 42:08John Coogan?

  Just drops it.

• 42:08Jordi Hays?

  Thoughts?

• 42:09John Coogan?

  Yeah, exactly.

• 42:11Jordi Hays?

  The bulk of his package comes in performance units with a target value of 126 million, split evenly into two branches. The PSUs are valued by the parent company, blah, blah, blah. It could pay out as much as twice the target, a quarter billion if it outperforms significantly or nothing if it lags behind.

• 42:29John Coogan?

  Got to beat the S and P 100.

• 42:32Jordi Hays?

  Pichai will receive Waymo stock with a target, stock in Waymo with a target value of 130 million and 45 million in wing aviation. That's their, um, uh, their, their drone delivery.

• 42:44John Coogan?

  Drone delivery platform.

• 42:45Jordi Hays?

  Platform.

• 42:47Jordi Hays?

  Uh, again, both can pay out up to 200% of the target.

• 42:53John Coogan?

  They've got a lot of incentive pay. Like if, if he delivers and the, and the company does well, um, he should, he should be richly rewarded. Uh, Barron's was writing about the, the death of the Mag 7. Mag 7's over. Uh, up and down Wall Street, the Mag 7 era ends. The Barron's is calling it. They said, stick a fork in it. Turn out the lights. Hasta la vista. Say it any way you'd like. The simple truth is the Mag 7 trade is over. Finito. I love Barron's writing. Dead. The collective stock market outperformance of those seven tech icons, Alphabet, Amazon.com, Apple, Meta Platforms, Nvidia, Microsoft and Tesla is now a thing of the past. The group may still do okay.

• 43:38John Coogan?

  And some of the individual stocks may even kill it, but the slam dunk, set it and forget it, run circles around the market era of the Mag 7 is gone with the wind. Recall that B of A Securities Analyst, Michael Harnett coined the term Mag 7 in 2023, pretty recently. Referring to the 1970s John Sturges Western gunslinger flick, an adaptation of Akira Kurosawa's 1954 film, Seven Samurai. Have you seen Seven Samurai?

• 44:07Jordi Hays?

  No.

• 44:08John Coogan?

  Have you seen The Magnificent Seven?

• 44:12Jordi Hays?

  The stocks?

• 44:13John Coogan?

  No, the movie, the movie, The Western.

• 44:16Jordi Hays?

  No.

• 44:16John Coogan?

  He's talking about Seven Samurai.

• 44:18Jordi Hays?

  In what world?

• 44:19John Coogan?

  Production team, has anyone seen either of those movies?

• 44:22Speaker 06

  I think we watched them in school.

• 44:23John Coogan?

  Okay, okay.

• 44:24Jordi Hays?

  You're saying you didn't watch them, you studied them?

• 44:28John Coogan?

  Well, yeah, yeah, yeah.

• 44:29Speaker 06

  Haven't seen them in a while.

• 44:29John Coogan?

  Which ones have you seen, Tyler?

• 44:31Speaker 06

  Seven Samurai.

• 44:31John Coogan?

  Seven Samurai, it's a great one. It's a very, it's a very good movie. Anyway, Barron's is bearish on the Mac 7, but Sundar Pichai is Dublin. It does sound like Coke. I think the Mac 7 will do.

• 44:42Jordi Hays?

  It's like, the large, it's over for the largest and most profitable companies in history that stand to benefit.

• 44:49John Coogan?

  Yep. The actual, the actual argument was the growth to value narrative, the loss of cash flow as they increasingly invest in CapEx. The, the financials will look very different. There'll be a margin compression, that type of thing. It, it's not an unreasonable take, but it is, it is just funny, the, the way it's written. Anyway. Sundar Pichai took over as CEO in August of 2015. He's going on 11 years in the seat. Google's market cap has increased almost sevenfold from half a trillion to 3.6 trillion, briefly topping 4 trillion in January. This surge has made the Indian-born 53-year-old former McKinsey consultant a billionaire. He joined in 2004 and made his name developing the Chrome browser and leading the Android division.

• 45:33John Coogan?

  He had been criticized for being too slow to adopt AI at the search giant, allowing OpenAI to release the first, first hit product, ChatGPT, in late 2022. But he has since bounced back, releasing cutting-edge AI models and integrating the technology into its dominant search engine. Yes, he's done very, very well on that front. Pichai has also navigated a duo of antitrust cases brought against Google's search and app store businesses, avoiding the worst-case scenario of forced breakup. A third lawsuit is pending against the advertising network. Tyler, do you think that DeepMind counts as, as RSI capable at this point?

• 46:11John Coogan?

  recursive self-improvement. So there was a take on the timeline where basically someone was making the argument that XAI is cooked because while Anthropic is using Claude to build Claude and OpenAI is using Codex to build Codex. So both of those leading private AI labs are recursively self-improving. XAI was using Claude code to build Grok and so they don't have the same flywheel of the tools that build the tools build the tools.

• 46:41Speaker 06

  Yeah, because I think they lost access to Claude code.

• 46:44John Coogan?

  Yes.

• 46:44Speaker 06

  But then they still have access to Codex.

• 46:45John Coogan?

  Okay.

• 46:46Speaker 06

  So you can, it's kind of like, do you count that as RSI because it's not like really internal?

• 46:50John Coogan?

  Yeah.

• 46:51Speaker 06

  But is Gemini, that's the question.

• 46:53John Coogan?

  Yeah, yeah.

• 46:54Speaker 06

  I'm sure people at Gemini are using Gemini. I mean, there is a Gemini CLI.

• 46:58John Coogan?

  Yeah.

• 46:59Speaker 06

  People don't talk about it as much.

• 47:00John Coogan?

  Yeah, yeah, yeah.

• 47:00Speaker 06

  I mean, the model is very good, right?

• 47:01John Coogan?

  Yeah, yeah.

• 47:02Speaker 06

  I assume it is.

• 47:03John Coogan?

  It would be interesting. I feel like we don't get as many little data points from the Gemini and DeepMind team because it's a public company and they need to, you know, maybe break out financials at some point.

• 47:14Speaker 06

  Yeah, I think like vague posting is probably, you know, more heavily looked at.

• 47:19John Coogan?

  Exactly, exactly. Because you would, yeah, yeah, because it's totally possible that they're doing the same thing. I mean, Demis has been extremely, just very clear about the path this goes and he's very AGI pilled. He understands the exponentials and whatnot. So he certainly messaged it at a high level without actually saying, you know, definitively, yes, like we are at a point where we're not writing any code by hand, that type of phrasing that you see in the RSI crowd. Anyway, Pichai got, last got a stock award in December of 2022 worth 218 million, which was structured in the same way. His earnings are topped up by his personal security costs, which rose to 8.3

• 47:59John Coogan?

  million in 2024. Earlier in the week, he sold 32,500 Class C shares at an average price of $303, worth roughly $10 million. The Bloomberg Billionaires Index estimates that he has sold about $650 million in stock since becoming CEO. They still own, along with his wife, he owns 1.67 million shares of Google, worth half a billion at the latest stock price. And Google's founders, Sergey Brin and Larry Page, still control the company through their ownership of super voting Class B stock, which gives them 56% of decision-making power. Interesting.

• 48:39John Coogan?

  I think you gotta give Miami.

• 48:40Jordi Hays?

  Paperhands?

• 48:42John Coogan?

  Oh.

• 48:43Jordi Hays?

  He sold 650 million of stock.

• 48:45John Coogan?

  No, no, no. He's sold that, but he's, uh, oh, and he only owns half a billion. So, yeah, he sold more than half.

• 48:52Jordi Hays?

  Hopefully, hopefully, hopefully he put it all into video.

• 48:58John Coogan?

  Paperhands, but he's getting topped up and he's diamond handings, the new, he's diamond.

• 49:02Jordi Hays?

  I know. I'm just saying, I'm just saying, looking at the stock charts since 2015, when he became CEO, would have done pretty well just to not do anything and trust, trust his own process.

• 49:11John Coogan?

  Hey, hey, maybe he has amazing car collection or something, you know, there's a lot of things.

• 49:16Jordi Hays?

  Rotate into metal, maybe.

• 49:17John Coogan?

  You can't drive a Google class, class A share. You can't, you can't sleep on a bed of class C shares, Jordy. You gotta, you gotta get liquid. No, you gotta give Miami Tech its due because everyone's saying, oh, Miami Tech, they don't have any startups. There's no funding there. There's no, Miami Tech isn't panning out. Well, Google is now counts as a Miami tech company. Because the Google founders bought houses there. You also gotta count Meta as a Miami tech company. Because Mark Zuckerberg has a house there. So you put Meta and Google, that's like $6 trillion in market cap for tech company.

• 49:54Jordi Hays?

  All in Miami.

• 49:55John Coogan?

  I count it. I count it. Anyway.

• 49:58Jordi Hays?

  Uh, owner of Four Loko is exploring a sale of a storied alcohol brand, sources say.

• 50:05John Coogan?

  Wow. Let's dig into this, but first let me tell you about Plaid. Plaid powers the apps you use to spend, save, borrow, and invest securely connecting bank accounts to move money, fight fraud, and improve lending now with AI. And let me also tell you about cognition. They're the makers of Devon, the AI software engineer. Crush your backlog with your personal AI engineering team. So.

• 50:22Jordi Hays?

  The parent company of Four Loko, the canned alcoholic beverage that became a college campus sensation in the late 2000s, before being reformulated under regulatory pressure, is exploring. I cannot believe they nerfed Four Loko.

• 50:37John Coogan?

  It was too powerful. It was too powerful.

• 50:39Jordi Hays?

  Like, you can just imagine the trajectory of the United States if it hadn't been nerfed. And then-

• 50:44John Coogan?

  Straight downward.

• 50:46Jordi Hays?

  Really?

• 50:46John Coogan?

  Yes. It was so bad. It was so-

• 50:49Jordi Hays?

  I thought people were having like, heart attacks.

• 50:51John Coogan?

  Yes, it was terrible. So-

• 50:52Jordi Hays?

  Oh, really?

• 50:53John Coogan?

  Four Loko was a 24 ounce can, so twice the size of a normal alcoholic beverage.

• 50:58Jordi Hays?

  Trey, the birthday boy, says it was amazing.

• 51:00John Coogan?

  It was amazing, okay. Now we have buzz balls, that's true. So, Four Loko, the original formulation was twice as big as a normal can of Bud Light, or Miller Lite, or Coors Light, your normal beer, something that you would grab. So, it was two drinks that way, and then instead of it being 3.2% alcohol, or 4.5% alcohol, it was like 10% alcohol. It was the strength of like, wine, almost. And so, a single Four Loko was like, four or five beers in one can. And then they also added like, 200mg of caffeine. So, you were, you would, you would become incredibly intoxicated and inebriated, but then also incredibly stimulated from all the caffeine.

• 51:46John Coogan?

  And that spelled doom for many people. People would be very high functioning, but completely inebriated and discombobulated. And so, they would, you know, get into all sorts of trouble. Whether or not it was behind a motor vehicle, or-

• 52:00Jordi Hays?

  A discombobulator.

• 52:01John Coogan?

  It was the, it was the discombobulator. It was also wildly illegal from an FDA perspective. You can't mix alcohol and caffeine in a single product. That's just a rule that they chose not to follow, and they figured out how to make it. And then, the FDA eventually gave them a warning letter, and they pulled the caffeine out, and that of course, killed the viral sensation that was Four Loko. But apparently, the company continued to sell products that were compliant with the current FDA regulation.

• 52:33Jordi Hays?

  Nerf.

• 52:33John Coogan?

  That's nerfed. The nerf for Loko continued to-

• 52:37Jordi Hays?

  Somehow, they're looking to, and potentially will capture somewhere around 400 million on-

• 52:45Jordi Hays?

  The sale.

• 52:45John Coogan?

  The brand value. So people, it's hilarious that they're working with JP Morgan on this. That's wild. So Fusion Products is the owner of the brand. They're working with JP Morgan on the sale process. The potential sale underscores how ready to drink beverages have emerged as a growth category in an otherwise sluggish alcohol market. U.S. beer and wine, U.S. beer, wine and spirit sales declined in 2025. We've talked to a number of guests about the declining alcohol sales as folks move over to more functional beverages.

• 53:16Jordi Hays?

  Here's what the CMO had to say. For over a decade, our sales have been the leading flavored malted beverage have have been leading the flavored malted beverage market by embracing bold innovation, unconventional marketing, and a risk-taking attitude that delivers results year after year.

• 53:35John Coogan?

  I guess they kept building. They also own.

• 53:37Jordi Hays?

  The parent company also owns Mavisas, Pirate Water.

• 53:41John Coogan?

  Pirate Water.

• 53:42Jordi Hays?

  Bossico Tequila and just Earthquake.

• 53:45John Coogan?

  Earthquake. Earthquake seems like something you definitely want.

• 53:48Jordi Hays?

  From the makers of Four Loko, Earthquake.

• 53:53John Coogan?

  Pirate Water is a wild name for a brand too. I mean, it's a distinctive can. It looks remarkable. It jumps off the shelves. When these, when the Four Loko nerf went into effect and they pulled them from the shelves, because before they reformulated without the caffeine, they had to pull them from the shelves entirely. They were a hot commodity and folks would go around stockpiling them before they were banned and, and they were the, one of the most guarded resources in all of college campuses.

• 54:20Jordi Hays?

  Wow, Earthquake is just a can that's just 10% alcohol.

• 54:24John Coogan?

  Wow. Do not recommend. Very risky.

• 54:28Jordi Hays?

  Never quake.

• 54:29John Coogan?

  Anyway, in 2010, the FDA sent warning letters to caffeinated alcohol beverage makers, including Four Loko, saying that the caffeine in their products constituted an unsafe food additive. So the FDA has specific categories for regulation around, around what is an alcoholic beverage, what is a caffeinated beverage, and they'd never, the two shall mix. So they don't let you put these two things together. Of course, vodka Red Bull was the precursor to this where folks would order a, a Red Bull and then they would put vodka in it, I think, but at a bar, which is made at the time of sale. And so that was legal, I believe. And this might be fake news, but I remember hearing a story that at one point.

• 55:12John Coogan?

  Red Bull was sued because a gentleman had purchased a series of vodka Red Bulls, become incredibly inebriated, gotten behind the wheel of the car, of a car, gotten into some sort of accident and wound up in front of a judge. And the argument was that he wanted Red Bull to be held liable for his actions while inebriated behind the motor vehicle. And his argument was that it was only because of the product Red Bull had been mixed with the vodka that he made the decision that he was alert enough, stimulated enough from the caffeine, to get behind the car wheel in the first place.

• 55:52John Coogan?

  And this might be apocryphal, but the story goes that Red Bull made the argument that the caffeine actually made him more capable to drive, not less capable to drive, and actually increased the safety of the driver and the vehicle, and so they were held not responsible. But I don't know, it's just like an old wives tale in CPG. I don't know if it's true. Anyway, let's move on to Phantom Cash. Fund your wallet without exchanges or middlemen and spend with the Phantom Card. And let me also tell you about Labelbox. RL environments, voice, robotics, evals, and expert human data. Labelbox is the data factory behind the world's leading AI teams. So, we're all preparing for the singularity. What is this, doing dishes?

• 56:34John Coogan?

  Just like, oh, if you're doing dishes, you're not worried about Dylan Patel's viral post saying that being in SF is like being in Wuhan right before the pandemic, something is happening, it's gonna hit everywhere, but so few people know it. And that is the question of, are we in a software-only singularity where the dishwasher is life as normal? And every time I go to the COVID analogy, I start a clock. Because I remember tracking COVID in January, and I remember the viral post, Bology posted in February going viral. And then in March, the NBA shut down, and in April, everyone was locked down. And so every time I see one of these, it's like COVID. I'm like, okay.

• 57:18John Coogan?

  Let's see what it, let's see, let's see what it's like in eight weeks. Like eight weeks is not that long. In eight weeks, if, if I, if I go outside and things look radically different and you talk to random people and it's wildly different, then we're like, okay, yes, that analogy was correct. But if it's more like in eight weeks, we're like, oh yeah, like, you know, technology is getting more exciting and like, tech companies are changing and like the market's moving, but like, you know, the, the, the, the, the dishwasher is unaffected, the, the, the pizza place on the corner is unaffected. That, that's always how I, I, I just think people underrate like, how crazy a global plague was. Like, it's literally like a once in a hundred, like the most insane thing ever. It's the, the craziest change to,

• 57:59John Coogan?

  literally everything from the sports that you watch, you couldn't go to the movie theater, you couldn't go to dinner, like everything was changed for like a full year. It was like, complete upheaval in our society and might happen, but eight weeks, eight weeks is a little fast for me.

• 58:15Jordi Hays?

  And if you live in LA, probably still be able to go to the beach.

• 58:19John Coogan?

  I think so.

• 58:20Jordi Hays?

  So that's.

• 58:21John Coogan?

  But maybe not, maybe everything's.

• 58:22Jordi Hays?

  Uh, I did have a funny moment yesterday. I was telling you, but I'll, I'll share it again. Uh, I was talking with my, my, uh, car detailer who's, uh, become a dear friend and, uh, he was telling me that, uh, the people in my area, uh, cancel their appointments at a much higher rate than, uh, the people in the rest of LA. And he was talking about running analytics, iMessage, and I was like, oh, how are you, how do you do? Uh, how, how do you do that? And he's like, he's fully running, uh, OpenClaw. So he's now running, using OpenClaw to run, uh, his, uh, like car detailing business. He's like, yeah, just, just always running in the background. It's, it's, uh, some, to him, he was like, it's some combination of having like an EA.

• 59:05John Coogan?

  Yep.

• 59:05Jordi Hays?

  Or a CEO, like helping me manage the calendar, helping with comms, helping me make smarter decisions on routing and scheduling and all these things.

• 59:14John Coogan?

  So when you book. A detailing, meaning that this gentleman is coming to your house and cleaning your car, you send an iMessage to him, correct?

• 59:23Jordi Hays?

  Yeah.

• 59:24John Coogan?

  And that is what is so interesting about OpenClaw is that there were probably a thousand companies that were like, we're vertical SaaS for auto detailing. You gotta do everything over email. And they just got eaten alive because people use iMessage and iMessage has been this closed ecosystem that private companies could never access before. But it makes so much sense for him to say, hey, run through all my iMessages. And if I'm talking to my friends about the F1 race, just discard that. But if I'm talking to a client about potentially booking a detailing, put that in a spreadsheet, organize that, and then run some analytics and tell me what the patterns are.

• 1:00:05John Coogan?

  And that's just something that should have been SaaS for a decade, but Apple has a walled garden that has now been smashed down by OpenClaw. And I think it's really cool. And I think that that's what we're seeing the first like use cases for OpenClaw. It's like things that could not happen for business reasons, for logical reasons, sometimes for legal reasons, if you're talking about like downloading illegal films, like the Napster analogy, but a lot of times it's just, it's just, Apple didn't want to do a deal to integrate iMessage into Salesforce.

• 1:00:36Jordi Hays?

  The way to break down the walled garden was just to have a digital guy.

• 1:00:39John Coogan?

  Basically, yeah, who just combs over all this. So is that a new type of software that should have existed that now is unlocked? Is it disruptive? Like, it's not like he, it's not like he stopped using his previous CRM, probably didn't have anything. So now he has something?

• 1:00:56Jordi Hays?

  Yeah, he's pretty tech forward. He's tried every single SaaS tool that there is, but like, at the end of the day, having like a digital guy that has access to all of your tools is just a much better experience.

• 1:01:09John Coogan?

  And so I want to know what his bill is.

• 1:01:12Jordi Hays?

  He said he spent a decent amount.

• 1:01:14John Coogan?

  Okay, I want to know what it is this month, and then I want to know what it is in like a year. Because sometimes the maintenance of these systems can be really, really big. And then there's a question about, are we going to see per token deflation? Or are we going to see prices? Are prices being artificially held low because of competitive dynamics? So in a year, will he be spending more or less? Will he still be getting the value? These are all interesting questions, but I'm just excited that a digital product now exists that could not or didn't exist before. And that feels incredibly positive and cool. So very exciting. Anyway, we have our first guest of the show in the Restream waiting room. Let me tell you about console.com. Console-built AI agents, 70% of IT, HR and finance support, giving employees instant

• 1:01:59John Coogan?

  resolution for access requests and password resets. And without further ado, Dr. Alex Wistgen-Gross, welcome to the show. How are you doing?

• 1:02:06Jordi Hays?

  It's happening.

• 1:02:07Speaker 07

  Doing really well. Thank you, John. Thank you, Jordy.

• 1:02:09John Coogan?

  Thank you so much for taking the time to come chat with us. Congratulations on all the virality. For those who haven't followed along so far, can you introduce yourself and the project broadly? And then I have a ton of questions, but I'll let you kick it off with an intro.

• 1:02:24Speaker 07

  Absolutely. So quick background on myself, originally from New York, undergrad MIT, studied physics, electrical engineering, computer science, math, PhD physics, Harvard.

• 1:02:33John Coogan?

  Was there anything you didn't study? You studied everything.

• 1:02:36Speaker 07

  Didn't study the humanities.

• 1:02:37John Coogan?

  Okay.

• 1:02:38Speaker 07

  Considered going to Cambridge to study chemistry and biology for a while to start it. Was told physics is a game for the young.

• 1:02:44John Coogan?

  Okay.

• 1:02:44Speaker 07

  So stayed in the US, did my PhD in physics, focusing on AI and nanotech.

• 1:02:48John Coogan?

  Cool.

• 1:02:49Speaker 07

  I've started, invested in, advised, managed dozens of companies at this point. I've had a number of exits. And at this point, most of my time is focused on smoothing out the singularity, as you guys were just discussing. So most recently, as you were gesturing, a company that I helped found, Eon Systems, Public Benefit Corporation, just announced what we've been characterizing as the first multi-behavior. Upload, if you will, more on that in a second, of a fruit fly, which we think is a major step forward for the field. And quite frankly, in an era when I do another podcast, the Moonshots podcast with my friend Peter, I talk all the time about tiling the earth

• 1:03:30Speaker 07

  with compute. Right now, all of this AI infra buildout that we're doing to the tunes of trillions of dollars of CapEx, all of this is going to artificial minds. And EON is playing, I think, a very important role in doing some early pioneering experiments and developments to try to level the playing field of the future, not just artificial minds playing on all of this trillions of dollars of infra and data centers, but enabling emulations and, if you will, uploads of human minds, non-human animal minds, at the moment, starting with fruit flies and aspirationally working towards mice and humans and getting the brains of a variety of human and non-human animals to operate in the cloud.

• 1:04:16John Coogan?

  So walk us through the fruit fly experiment, why it was so exciting for you.

• 1:04:21Speaker 07

  It's really interesting. If you think back, remember back with the launch of ChatGPT, that was just a side experiment. That wasn't the main focus of OpenAI at the time. Some have characterized that as an unhobbling, if you will. GPT-3, the leadership of OpenAI thought at the time was sort of the main entree, if you will. Similarly, within EON, I don't mind saying this was more of a side project that we thought it would be somewhat interesting to the world, but I think the level of response and virality probably even took most of EON by surprise. So this is a video demonstration of an internal project

• 1:05:03Speaker 07

  to take a bunch of building blocks that were already sitting around for the past one to two years and put them together for the first time. So one of these was a paper that a senior scientist at EON, Philip Xu, published in Nature in 2024, demonstrating that just from an emulation perspective, that you could take the flywire, which was a well-funded project to capture the connectome of the fruit fly brain, that you could emulate certain circuits within the fruit fly brain. Fruit fly brain. We've had that for a year and a half or so. Another project, NeuroMechFly version two.

• 1:05:40Speaker 07

  It's an excellent project to be able to formulate simulations in realistic mechanical environments of fruit flies. Another project from Erzdal et al. to formulate coordinated motor actuation of fruit flies. And then AI. So in summary, EON was really the first to put all these building blocks together that were sort of lying around. This is actually tiny subset of what EON is working on. EON is working on scanning the connectomes of of human and non-human animals at scale and achieving whole-brain emulation, which is the holy grail of the field. There have been many projects in the past that have attempted human whole-brain emulation.

• 1:06:23Speaker 07

  EON is leveraging advances in AI, expansion microscopy, a variety of other techniques. But it was really just putting the pieces together. So we're quite honestly astonished by the level of interest in just this one demo.

• 1:06:35John Coogan?

  I love it. I have a million questions. Let's start with I/O. Like the inputs and outputs, like what are you simulating? When I pull up the Sims, that is somewhat of a simulation of a human. The, you know, a basic for loop over a bunch of random probabilities to say, are you hungry? If hungry, eat, go over to the stove, cook food. That's obviously nowhere near the level of detail at which a human operates. Is there an abstraction layer here where the output is quantized to things that you would think a fly would do? Like move a, like move a wing? Or are you operating at the level of like choose to fly?

• 1:07:20John Coogan?

  Or how, at what level of abstraction is the fly's output happening?

• 1:07:27Speaker 07

  Yeah, this is what I was gesturing at a moment ago. So it's a paper by Erstil et al. That bundles motor actuations in terms of high level representations.

• 1:07:38John Coogan?

  Got it.

• 1:07:38Speaker 07

  So a lot of people, sort of the people who got perhaps most excited in the neuroscience community about this video, some of them, I think, didn't bother to read Erstil's excellent paper. So a lot of those, this is why I'm saying a lot of the pieces were sort of lying on the ground, waiting for us to pick up and put together. So these like, these abstract motor movements were already available. Just no one had ever, prior to this, bothered to wire them up.

• 1:08:04John Coogan?

  That's cool. Then what is the, do you need a system prompt? Like, do you need like an initialization function? Or once you, once you synthesize the connectome, synthesize the connections in the brain, things just start firing? Do you have to trigger something to, to start the process of consciousness, or whatever you call whatever the fly is doing?

• 1:08:30Speaker 07

  No system prompt needed. On the other hand, in the early days of ChatGPT, before instruction tuning, there was no system prompt either. In the days of early language models, no one had thought of prompt engineering. So it's entirely possible that maybe in the future, some sort of prompt engineering equivalent for, for whole brain emulation will be essential. But at the moment, there, there's no direct analog of that.

• 1:08:57John Coogan?

  Help me compare some of the scales that we're talking about on complexity of a fly, complexity of a mouse, complexity of a human. I imagine that we're on some sort of exponential here, but how many orders of magnitude in complexity, size, number of neurons, something like that, whatever the, the metric is, how far away are we from humanity?

• 1:09:20Speaker 07

  We're many orders of magnitude away. So the canonical estimate for the human brain is, depending on how you count brain cells, and there are multiple types of brain cells, call it order of magnitude 100 to 200 billion cells in the brain. We're many, many orders of magnitude, many orders of magnitude away from that. So this isn't going to happen immediately. We're not going to get human whole-brain emulation immediately. On the other hand, I think it's important, I think back to the early days of driverless cars and autonomous vehicles. And what the world is missing right now is, I think, sort of a scale or a framework for starting to think about what that future looks like. We're at the earliest stages of that, call it level one or level two uploading.

• 1:10:05Speaker 07

  A lot of people even get triggered by the term uploading. They prefer something else. And I think we need to start having these conversations in a critical, thoughtful way, and start to define what is a framework for multiple levels of fidelity for uploading or emulation, or maybe we come up with a new term. But right now, we're starting that discussion, and we're trying to do it in a thoughtful, responsible way.

• 1:10:27John Coogan?

  So you like the term uploading because you did not choose a random structure or an average structure of this particular fly's brain. You chose the exact structure of a particular fly's brain?

• 1:10:41Speaker 07

  This is a very expensive structure of a very particular fly's brain. This structure was, again, captured through the Flywire project at great expense.

• 1:10:52John Coogan?

  So that's like a clone, digital twin type of thing, right?

• 1:10:57Speaker 07

  Aspirationally. I mean, again, we're at the earliest stages. I don't want to oversell. This is just a prototype, and quite frankly, this is a sliver of everything that Eon is doing. But the fact that Eon was able to put a few of these pieces together, build a prototype with relatively small effort, suggests that, you know, we talk in the AI community all the time about overhangs. Many people thought that the arrival of large language models was, in some sense, a technological overhang. We could have, one could imagine a thought experiment, could we have had large language models 20 years ago if we simply knew what we should have been building? I think probably...

• 1:11:35John Coogan?

  I thought we were very GPU gated on that.

• 1:11:39Speaker 07

  Well, the GPUs were being spent on video games for the first few decades. So we could have, in principle, like Markov models, we knew how to build Markov Babblers. I was building Markov Babblers in the 90s and early 2000s.

• 1:11:52John Coogan?

  Yeah, it just feels like even if you, even if you try and port back Frontier models now to a, you know, 1080 Ti, which was a graphics card for gaming, you're gonna have a bad time.

• 1:12:05Speaker 07

  Well, I mean, with the rise of SLMs and some of the amazing deflationary properties of algorithmic progress in SLMs, I think we will find ourselves in the world next few years where some of the earliest PCs could probably have hosted non-trivial conversations with LLMs. There's just that much algorithmic progress.

• 1:12:27John Coogan?

  Extremely bullish for Apple. Anyway, not to put it in hardware terms.

• 1:12:32Jordi Hays?

  What do you want to do? What do you want to do next? Like, where do you, where do you go from here? I know it's a, I know it's a, it's like one of the

• 1:12:38John Coogan?

  More flies or straight to mouse?

• 1:12:41Speaker 07

  It's such a profoundly interesting question. So Eon is beginning fundraising. Eon wants to tackle both mice and men. And I, I think the timescale will be determined by both technical capability increases and also fundraising abilities. So I think it's an interesting time. I like to say, you know, on my other pod, that the singularity looks like all sci-fi tropes happening everywhere all at once. And one of these, one of these sci-fi tropes is most definitely mind uploading. And I'm doing my best, vis a vis Eon Systems, to push that part a little bit to the left so that the AIs don't have the Dyson Swarm all to themselves.

• 1:13:25John Coogan?

  Interesting. Architecturally, what does the neural network look like that you've built for the fly? Is it, is it similar to a large language model, like Transformer-based architecture? Or are you a beneficiary of it?

• 1:13:41Speaker 07

  Totally unlike the Transformers.

• 1:13:45Speaker 07

  Totally unlike the transformer. So transformer architecture, if you subtract off the encoder and decoder layers, looks, it comes in many variants, but the most vanilla variant looks like alternating linear and attention layers. So totally unlike the transformer architecture, at least if you look at it, it looks like, more like, a little bit more like a graph neural network, but really, that's such an AI way of framing it, it looks like a leaky integrating fire, LIF model of, that we've had for decades from the neuroscience world. So it's just a graph of nodes that have leaky integrating fire dynamics, and they're firing at each other.

• 1:14:22John Coogan?

  So what does that tell you about the nature of synthetic human intelligence? Like, do you think that there is a path to human-level AGI that does not involve the transformer, and instead falls along your path and your architecture?

• 1:14:41Speaker 07

  Oh, sure. Well, first of all, I would argue, we've had AGI for at least six years now, five to six years, at the very latest, since summer of 2020, when OpenAI published their language models, or a few shot learners paper, yeah, GPT-3, I would argue that was an AGI. So I think there are many ways, my bet is, there are many ways to achieve generality of intelligence. I published a paper a number of years ago, arguing that not only is intelligent behavior a general process, I went further and argued that it is a general physical process, that you can even formulate intelligent behavior in pure thermodynamic terms. So my bet is, intelligence is this very, very general effect, and lots of ways to implement it.

• 1:15:24John Coogan?

  Interesting. Do you, so, I mean, you've mentioned AGI six years ago, singularity here, and you're smoothing it. Do you have other sort of binary benchmarks that you're looking towards, like ASI, recursive self-improvement? Are any of these terms useful to you?

• 1:15:43Speaker 07

  Oh, we're already there. I mean, we're already in the era of recursive self-improvement. All of the frontier labs are pretty public about it. At this point, I'm looking past the singularity. So I spend most of my time on bets for what the post-singularity world looks like. So Eon is one of those bets. Another bet, I have a company, physical superintelligence, that's trying to solve all of physics with AI and doing an amazing job. I just wrote a book with Peter called Solve Everything, arguing that entire disciplines are going to get steamrolled by superintelligence and that what matters now is what disciplines we aim the superintelligence at. Interesting.

• 1:16:20Jordi Hays?

  What decisions do you make in your personal life, in the way that you live, that are based around your beliefs around technological progress?

• 1:16:33Speaker 07

  There are a few that come to mind. So one is, I'm hoping not to die. It would be a shame if I died sometime soon, get to miss the most exciting developments.

• 1:16:45Speaker 07

  Same. That's what gets the applause? That's great. Yeah. That's a white pill. White pill. Very good. Brian Johnson thanks me in advance. So, but I think also, I mean, there are so many other angles. Another is not trying to bet against the collective intelligence of the market. I've had a number of friends who thought they could outsmart all of the AI algo traders and day trade. And when they inevitably fail, they attribute it to bad luck or something other than than just fundamentally betting against progress and betting against AI intelligence. So trying not to make the mistake of betting against

• 1:17:28Speaker 07

  collective intelligence of civilization and AI capabilities. I also, I'm trying to make bets assuming that the AI capabilities keep increasing to the point where they're ontologically shocking and trying not to duplicate effort of frontier labs. And I think that's perhaps something I don't see enough of in the venture community. So many new startups being formed now just aren't being ambitious enough. I have startups that newly formed or recently formed that are literally trying to grow new islands and new coastlines with AI. That would have been unthinkable years ago. I have startups that's working-

• 1:18:07Jordi Hays?

  That's with physical AI? Or they're just dreaming them up?

• 1:18:13Speaker 07

  It's with AI reaching into the physical world to steer ocean currents and grow new islands and new coastlines. That would not have been possible a few years ago. That's now starting to become possible. I have a startup that's working on solving interspecies communication, starting with dogs. That would not have been possible a few years ago. So I spend a lot of my time thinking about what the post-singularity state of the world looks like and how to smooth that out and bring it here sooner.

• 1:18:38John Coogan?

  Yeah, what does the post-singularity world look like where you are able to upload yourself? I assume that feels like there's a copy of Alex in the cloud and then you still exist and not in the cloud. How do you think that that interfaces?

• 1:18:55Speaker 07

  In my mind, if we wind up having the copy question come about, that's almost a failure mode. Speaking for myself, I don't want a copy of myself. I want myself. And Hans Moravec and others have written about this. What I would like to see in the space and what Eon is working toward, at least aspirationally, is this idea of a continuous transfer of consciousness so that it really is you. It's not a copy of you. It's not a low-fidelity facsimile of you. It should be a better, expanded version of you that's still you. And whether that looks like moving from what Eon's doing right now with fruit flies to maybe replacing a single cell

• 1:19:35Speaker 07

  in a brain at a time, invasively or non-invasively, with a substrate independent or substrate migrated implementation, some variant of that, I suspect, is where all of this will go so that you never have to worry, is it really myself or not? It will, by construction, be yourself. And I'm not sure of the precise timetable, but I think five, 10 years from now, I think the world will see marked progress on the problem of not just whole-brain emulation, but also transfer of human intelligence to new substrates.

• 1:20:09John Coogan?

  That's very exciting. This is

• 1:20:12Jordi Hays?

  New sci fi corner.

• 1:20:13John Coogan?

  I love it. Uh, well, congratulations.

• 1:20:15Speaker 07

  Sci fi trope everywhere all at once.

• 1:20:18John Coogan?

  Time travel?

• 1:20:19Jordi Hays?

  Good framing.

• 1:20:19John Coogan?

  Is time travel on the table?

• 1:20:21Speaker 07

  We don't know yet. So it's an interesting question. We don't know whether the physics of our universe are compatible with, I think, what most folks would construe as as time travel. There are, there are versions of temporal non locality that are consistent with the physics that we have right now, but not in a useful way that you would, that would be worth filming a sci fi movie over.

• 1:20:40John Coogan?

  What about, uh, faster than light travel?

• 1:20:44Speaker 07

  We don't know yet. It's the same problem, in in some sense, I exactly the same problem as time travel. We don't know whether the physics of our universe will ultimately allow that.

• 1:20:52John Coogan?

  Cause it seems like if you don't get FTL, like there's a, it's gonna be a boring travel to go to another solar system.

• 1:21:00Speaker 07

  I, I will say this, I think odds are pretty good that AI in the next few years will tell us whether the, the laws of physics of our universe are compatible with that or not and help us solve this. One of the reasons why I helped found physical superintelligence to, to discover any of such laws.

• 1:21:15John Coogan?

  Very cool. Well, thank you so much for taking the time to come chat with us.

• 1:21:18Jordi Hays?

  Yeah, great to meet you.

• 1:21:19John Coogan?

  Congratulations on the progress.

• 1:21:20Jordi Hays?

  Fascinating stuff.

• 1:21:21Speaker 07

  Thank you. Likewise.

• 1:21:22John Coogan?

  We'll talk to you soon.

• 1:21:22Jordi Hays?

  Cheers.

• 1:21:23John Coogan?

  Have a good one. Let me tell you about Figma. No matter where your idea starts, Figma make, Claude code, Codex, or a sketch, the Figma canvas is where ideas connect and products take shape, build in the right direction with Figma. And let me also tell you about Cisco. Critical infrastructure for the AI era. Unlock seamless, real time experiences and new value with Cisco. And without further ado, we have Charles Lamanna from Microsoft in the Rooster Radio Room. Now he's in the TV from, Charles, how are you doing?

• 1:21:56Speaker 08

  Good. Thanks for having me on, guys.

• 1:21:57John Coogan?

  Thanks so much for coming on the show. Uh, why don't you give us a little bit of an introduction on yourself and then we can get into the news.

• 1:22:05Speaker 08

  Sure thing. I'm on the product engineering side at Microsoft. My team builds out things like agents, a bunch of the platform work and our business applications and some low code stuff. So a bunch of odds and ends.

• 1:22:16John Coogan?

  And what's the latest and greatest in your world?

• 1:22:20Speaker 08

  Yes, a lot of big news today. So today we announced Copilot Cowork, which really takes Copilot beyond chat. So it can take actions and automate tasks and pick delegation, basically. We had some new agentic capabilities in the Office apps and a bunch of agent management solutions.

• 1:22:35John Coogan?

  Yeah. How are you thinking about the the OpenClaw boom, people writing code locally versus Microsoft has Azure? Like, it's so easy to throw everything in the cloud. And I feel like one of the barriers that a lot of people have is like, do I need to go get a Mac Mini? Can I just delegate to the cloud? Some of the apps don't just by default build an app in the cloud or they don't have functionality. How are you feeling about that trade off these days?

• 1:23:04Speaker 08

  Yeah, I mean, we're super excited by OpenClaw and all that means. I think it's like the resurgence of the PC. Like, what's the best thing you can give an agent? A computer. Let it run the apps, let it login as you, let it messages you. I think like a Windows PC in the cloud is probably the main way people will ultimately use something like OpenClaw at work.

• 1:23:24John Coogan?

  Yeah. How do you think about model selection? Obviously, Microsoft has a has a time honored partnership with OpenAI at this point. But, you know, Microsoft has their own AI lab and you can get pretty much any model on Azure. Do customers want to pick models? How do you think about what is what's the best tool for the job in the products that you're building? But then also, how much do you want to give to the user? Because there's sometimes when I go into a chat app and I'm like, I just want auto. You should be figuring this out. I know the details of pro versus thinking, but I don't want to think at all.

• 1:24:01Speaker 08

  Yeah, so that's one of the things that we think is super important for Copilot and a lot of our products. The fact that it's multimodal. And the reason is because the best model for a given kind of task is not always the same. And it's not even the same from month to month or quarter to quarter. Like if I look at Microsoft 365 Copilot, chat is like the main way people interact with it. Our auto router is going to put you in OpenAI models because that's what we think works best with our work grounding and our work context. But then if you go to cowork, the new announcement today and you fire off a task and you want it to run for a long period of time in the background, use a bunch of tools, maybe generate some code, use like the terminal and stuff. That uses the Claude family of models. And I go to Copilot one place and get both.

• 1:24:43Speaker 08

  And then we're going to keep adding more models, models like from MAI and other places where it makes sense. But it's really about the experience the user wants, not so much picking exactly the version or the type.

• 1:24:54John Coogan?

  Yeah. How have conversations been with business leaders in terms of deploying a product like Copilot Cowork? Because the ramp up for software engineers was smooth and everyone was aware of it, tracking everything and going from, you know, better autocomplete to agentic coding was was pretty intelligible at every step of the way for most software developers. But for someone who's lived their life in spreadsheets and email and maybe not really thought about building automations all that often, what does actual deployment of these tools look like?

• 1:25:34Speaker 08

  Yeah, it's such a great question because I think there's like two pieces to it. The first is you have IT teams which are nervous with, if you imagine every single employee spinning up a whole bunch of agents that can create documents, send emails, run workflows. So they want to make sure they have the right governance and controls in place. That's why another big part of the announcement today was something called Agent 365, which makes it easy for IT teams to manage and deploy agents from Microsoft and other companies. So that's one part. And then you have the end users. How do you teach a typical Excel or PowerPoint or Outlook user this idea of agentic working? Even in coders, it's taken time and it's probably not fully diffuse.

• 1:26:15Speaker 08

  So that's the thing that we think we're in a really unique position at Microsoft in terms of being able to do. Because we can bring things like cowork to users where they already spend their time. Inside of the Office apps, inside of Windows and increasingly inside the Copilot app. And we can present it in a way where it's digestible to hundreds of millions of Office users, not just tens of millions of coders.

• 1:26:39John Coogan?

  Is the majority of your business model still seat-based at this point? Because I imagine that there will be a transition at some point. How much of that transition is already happening?

• 1:26:49Speaker 08

  Yeah, we're, we're still very seat-based on like the M365 side, but like the good news at Microsoft, we kind of know how to do consumption businesses because we got Azure.

• 1:26:58John Coogan?

  Yeah.

• 1:26:58Speaker 08

  We got a bunch of other very large capacity businesses. So the fact that we have user licensing and then consumption and pay-as-you-go licensing for capacity, all integrated with one commercial kind of vehicle with customers. We think we're in a pretty good position to make that transition over the next couple of years.

• 1:27:15John Coogan?

  There was some, uh, there was some chatter on X this weekend over, how different labs are pricing tokens and plans, potentially to take market share from each other. There's a little bit of a capital fight playing out. How are you communicating?

• 1:27:31Speaker 08

  Yeah, more specifically competing with the application layer.

• 1:27:33John Coogan?

  Yes, yeah. And so, and so, uh, my question is, how are you talking to business leaders, CTOs, about how they should think about forecasting token budgets and spend and compute budgets? If they, if they're used to, okay, I have licenses and licenses maybe go up in price and my headcount goes up and I'm used to that. But all of a sudden, it's like, well, everyone's paying $200 a month, but it might be $5,000 a month in a couple of months. But also the models are getting cheaper and the inference is getting cheaper and the capabilities are going up. And it's very hard to predict. What are you talking to? Wha- what are you telling to business leaders and, uh, CTOs?

• 1:28:10Speaker 08

  Yeah, so I, the, the first thing is you have to embrace this technology. Otherwise, you're going to be left behind right now because the productivity gains are just so significant. And if you go talk to a coder, and you told them, hey, I'm going to take away like GitHub Copilot and the agentic coding capabilities, they'd be like, I refuse to work in this environment. Like, it's just, it's just inhumane almost. So, so I think the, the same type of thing. It's going to happen for all information work, all office work. So nine months from now, I think if you went to somebody and said, we're going to take away your agentic tools like Copilot, Cowork, they'd be like, no way, I'm not going to go back to the old way of working. So, so I think the first is that there's a degree of inevitability because the benefit

• 1:28:52Speaker 08

  is so large and there's such strong pull from the end users. That said, you, everybody has budgets. So what you're going to see and what you're already starting to see is a bunch of controls where IT teams can start to manage exactly how many tokens or how much dollars each user can spend and they're going to allocate that in a way based on where they think they're getting return and diminishing return and it'll probably be like a expense report approval hierarchy type thing. So you'll see all of that show up, but part of just doing work now is you need a token budget. That, that's the future of how we think about and how you budget for a team or a department.

• 1:29:32John Coogan?

  Where, do you have any exciting case studies on the non-software engineering agentic work side of the business? Because when, when agentic coding came to software development, you know, there was a shift in a lot of software developers workflows where they went from writing a lot of code to reading a lot of code, reviewing PRs. They, they started operating at higher and higher levels of abstraction, but the decision what to build, how to prioritize things, how to build features, there's still conversations and software engineers are still doing work. What does that look like in the context of, of a finance department or an operations department or a sales group?

• 1:30:15John Coogan?

  Like where, when the rubber meets the road, like where are you seeing like, okay, this, this is ready, this is the next, this is the next sub area or category that will really, really benefit from the productivity gains from agentic workflows?

• 1:30:31Speaker 08

  Yeah, I mean, a general thing, and then maybe a more specific thing. What we're seeing is like, how do you measure productivity? Is itself a challenge? I mean, this is, this predates AI, but right? Like, lines of code, number of pull requests, number of bugs fixed. Though, I don't think I've ever heard a good engineering leader say, that's how I measure the success of my team, right? It shows up in other ways. Do you have a great product people love? Is your cost structure good? What's your install base look like? So, so I think we have to get better at capturing that final business outcome. Cause that's what's going to get the CFO to open up the pocketbook and continue to invest in more tokens and more AI.

• 1:31:09Speaker 08

  So if I go then, take that and apply to kind of other disciplines, like you, what you don't want to say is, oh, our salespeople send a lot more emails. Or our finance professionals create a hundred more spreadsheets. Like, that's more like of a nightmare scenario for AI. One billion spreadsheets per company.

• 1:31:27John Coogan?

  No, no, I mean, we saw someone on the timeline say that their, their token budget went way up, but their revenue didn't go up. And so they're like, I don't know if it's, if it's worth it. Like, you gotta show results.

• 1:31:38Speaker 08

  Exactly. So that, that is what the question's going to be everywhere. But the, the good, the good news is, engineers historically have resisted clear measurement of impact. Cause you know, there's a little bit of art to it. But like, sales professionals, or finance professionals, or customer service and, and support reps, they are so metric driven. Like, if I'm a sales rep, what's my quota? What's my attainment? What's my revenue per head? Every single sales department has all of those things instrumented. And we've seen with M365 Copilot, we kind of did a bunch of experiments. We published a white paper on it, like an almost 10% increase in revenue per seller, just by giving them this, the family of M365 Copilot tools and things like our sales extension.

• 1:32:22Speaker 08

  That's real dollars in the bank. Same thing for like back office finance processes. We've seen people use like our agents to do like accounts reconciliation. And we have like a great case study we did there where it's like 30% of all back office finance was automated out by this thing. So tho- those are examples of real top line and bottom line benefit. And that that's what everybody's going to be talking about the next couple of years. It's not going to be, you know, emails, documents, files, et cetera.

• 1:32:50John Coogan?

  Yeah, yeah. I mean, you're in a you're in a high level business role yourself. I find myself doing a lot of like knowledge retrieval, deep research reports. But have you personally been using Agentic, I mean, this product specifically in your day to day? Like even as something as simple as like a Sam Altman told us that he has a self. He has some sort of like to do list that does itself or something. I still don't understand exactly what that product is, but how are you using these tools these days?

• 1:33:19Speaker 08

  Yeah, so the for like Copilot, CoWork, for example, I I've loved that. Like my favorite magic moment has been around calendar management. I was telling the story to someone like I go look out three months in the future and try to see, you know, how crazy is my calendar and travel look like?

• 1:33:36John Coogan?

  Interesting.

• 1:33:36Speaker 08

  And I was able to decline 17 meetings for me.

• 1:33:39John Coogan?

  Okay, that's productivity right there.

• 1:33:41Speaker 08

  Yes, exactly.

• 1:33:42John Coogan?

  Nothing gives me more joy than declining a meeting. You sold me.

• 1:33:46Speaker 08

  Yes. And I'd say like I went to Outlook and just saw all the meetings disappear. And it was like such a serene moment for me. And and like it did a deep analysis. It it went and said like, who's my manager? Who do I work with? Am I optional or required? What's the topic? And it recommended the 17. And I went through all 17 and said, you know what? Decline. And it was right. I mean, so like, that's one thing that I use it for. Like another thing that I like right now is, I mean, I'm an engineering background, so I'm not going to go create the most beautiful content all the time. So I use it now to pull together information, design docs, meeting notes, and then go create either like the architecture diagrams, presentations, or spreadsheets or docs. And I mean, I know it's just more doc generation, but it's very much more kind of like fire and forget. So it works really well.

• 1:34:31John Coogan?

  Yeah, yeah. I mean, even if it's just like the bones of a PowerPoint presentation with the actual data pre-populated, that would just previously be a lot of copy paste, go run this analysis, copy it over, make sure it's the same font. Like, there's so much grunt work that can be automated with these tools. I'm super excited for that. I, where do you see the, the design PowerPoint generation, uh, tool use? I mean, people have been talking about like, it's hard to create an RL environment with a verifiable reward around a great PDF, but it's easy to do that with coding. Do you, do you have like an internal data set of like the best PowerPoints ever created and you're, that you're like RLing against? Or where do you see that going?

• 1:35:15Speaker 08

  Yeah, I mean, I think that is something that, that there's a little bit of taste in all of this, cause like depending on the company, some companies like lots of infographics and lots of colors. Other companies like super fact-based, no images. So like, you know, there's a little bit of an eye of the beholder, but absolutely we have a very robust harness and like gym environment where we're able to quickly evaluate models, prompts, tools, in our own like fine-tuning efforts to see if it's producing better content. So I think like this, like uh, PowerPoints, Word documents, spreadsheets, it's gonna be like code. And you're starting to see it already, but it's gonna be like code for sure.

• 1:35:54John Coogan?

  Yeah, I, I mean, it, like it, a lot of these things are like XML under the hood anyway, and, and can be puppeteered like code anyway. Uh, well, congratulations on the launch, uh, Jordi.

• 1:36:05Jordi Hays?

  I hope you don't mind, I've been calling, uh, co-pilot, co-er, Coco.

• 1:36:09John Coogan?

  Coco.

• 1:36:09Jordi Hays?

  So hopefully it doesn't stick unless you like it.

• 1:36:13John Coogan?

  It's very cute. Yeah, it's a, it's a very cute name.

• 1:36:16Jordi Hays?

  Uh, but congrats, congrats on the launch and great to meet you.

• 1:36:19John Coogan?

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

• 1:36:21Speaker 08

  Thanks, guys.

• 1:36:22John Coogan?

  We'll talk to you soon. 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. And let me also tell you about Graphite, code review for the age of AI. Graphite helps teams on GitHub ship higher quality software faster. Uh, there's an interesting data point from Apollo, featured by restructuring here. Uh, AI is making, starting a business easier and the numbers confirm it. Did you see this? Weekly business formation is exploding higher. So, uh, Previously.

• 1:36:55Jordi Hays?

  This matches what the Carlson Brothers said when they had the show.

• 1:36:58John Coogan?

  Yeah.

• 1:36:58Jordi Hays?

  They're seeing not just more business formation, but businesses growing faster.

• 1:37:03John Coogan?

  Is this, it could be that AI is actually making businesses harder to start, but Stripe Atlas is making it so much easier that we're seeing an upward trend and it's fighting back against AI. Now, of course, these are.

• 1:37:16Jordi Hays?

  Jeff Weinstein is just.

• 1:37:18John Coogan?

  These are multiplicative, very clearly, but Stripe Atlas does make it very easy to start a business. U.S. business applications jumped insanely after the COVID pandemic. In 2019, we were seeing about 60,000, 70,000 new business applications. I think a four-week moving average. We've been over 120K for years now and AI seems to be driving that trend upwards by about 20% over the last two years, which is great news. More, more small businesses, they are extremely edifying, extremely valuable. I highly recommend.

• 1:37:54Jordi Hays?

  And we got another white pill.

• 1:37:55John Coogan?

  Give it to me.

• 1:37:56Jordi Hays?

  The data center buildout has allowed Luden County to lower property taxes by 38% since 2010, translating to average savings of about $3,400 per year for homeowners.

• 1:38:09John Coogan?

  This is great.

• 1:38:10Jordi Hays?

  Love it.

• 1:38:11John Coogan?

  What's happening here? Data center square footage in the millions has gone from 5 million square feet to 40 million square feet. That's a huge jump.

• 1:38:21Speaker 06

  Yes, this is like Northern Virginia. This is like AWS East One.

• 1:38:25John Coogan?

  Okay, okay.

• 1:38:26Speaker 06

  Yeah.

• 1:38:26John Coogan?

  So, so homeowners are paying, they went from 1.2% of whatever their house is. So if they have a million dollar house, they will be paying $12,000 a year. And now they're at 0.8% property tax rate because they're taxing those data centers. This is the easiest solution to every AI problem. If the companies are profitable, tax them. If the, if we already tax every business, we tax them by default. If somebody makes a lot of money on an AI stock, taxes is capital gains. You get the money. The money shall flow and so good news for the folks over in Luden County.

• 1:39:04Jordi Hays?

  Jacob says, "America once named things plainly: place, trade, surname." You had business, international business machines, long-distance telephone.

• 1:39:16John Coogan?

  Studebaker.

• 1:39:17Jordi Hays?

  Studebaker.

• 1:39:18John Coogan?

  And Bethlehem Steel.

• 1:39:19Jordi Hays?

  Steel.

• 1:39:20John Coogan?

  That International Business Machines logo is

• 1:39:24Jordi Hays?

  Goes unbelievably hard.

• 1:39:26John Coogan?

  Is this real? Or is this like a reimagining of what the IBM logo could have been? Because I love this logo. What a very cool thing.

• 1:39:36Jordi Hays?

  That is apparently the original IBM logo.

• 1:39:39John Coogan?

  IBM logo, wow. We don't know how to make logos like that in this country anymore, seriously. I mean, that's what kicked all this off. Somebody was upset about the granola rebound.

• 1:39:49Jordi Hays?

  America's innovation slowdown is primarily due to the amount of Lord of the Rings that founders have to flip through before identifying a name they can raise off of.

• 1:39:56John Coogan?

  No, you can just start a company and name it International Business Machines. Whatever you want to do, just name the company exactly that. Technology and Business Programming Network. It's that easy. In other news, Two Chainz.

• 1:40:09Jordi Hays?

  Uh, Two Chainz revealed he was an early investor in SpaceX.

• 1:40:12John Coogan?

  This is huge.

• 1:40:13Jordi Hays?

  He says, it just felt like I got in like early Bitcoin.

• 1:40:16John Coogan?

  There are some crazy early SpaceX investors. I don't know what Elon was doing with that early roadshow. We know some of these folks. Very cool community, early SpaceX.

• 1:40:26Jordi Hays?

  Get me Two Chainz.

• 1:40:26John Coogan?

  Get me Two Chainz. Two Chainz got in at some point. And Gabriel over at OpenAI says Two Chainz is about to be Three Chainz. Well, let me tell you about Okta.

• 1:40:38John Coogan?

  Okta helps you assign every AI agent a trusted identity. So you get the power of AI without the risk. Secure every agent, secure any agent. Let me also tell you about the New York Stock Exchange. Hopefully we'll be seeing SpaceX there soon. Want to change the world? Raise capital at the New York Stock Exchange. Can you imagine Two Chainz and Elon ringing the bell at the New York Stock Exchange? I can, I hope it happens. Well, we have our next guest in the stream right here. Julian back from Sequoia Capital. His partner there. Welcome to the show.

• 1:41:07Jordi Hays?

  What's happening?

• 1:41:08John Coogan?

  Julian, good to meet you.

• 1:41:09Speaker 09

  Hey guys.

• 1:41:10John Coogan?

  How you doing?

• 1:41:11Speaker 09

  Nice to see you. We also hope we can ring the bell very soon.

• 1:41:14John Coogan?

  Holy, holy logo mog.

• 1:41:16Jordi Hays?

  Yeah.

• 1:41:16John Coogan?

  Holy logo mog.

• 1:41:18Jordi Hays?

  A few of those companies.

• 1:41:19John Coogan?

  I do. We're partnered with Cisco. Thank you for backing them early, making TVPN possible.

• 1:41:24Jordi Hays?

  Through your.

• 1:41:24John Coogan?

  Thirty years ago.

• 1:41:27Speaker 09

  You saved the wave.

• 1:41:28John Coogan?

  Sid, this is the first time in the show. Why don't you give us just a brief backstory on yourself? How you wound up at Sequoia? What you focus on? What your day to day is like?

• 1:41:36Speaker 09

  Sure. So first, thank you both for having me. It's an honor to be there. I know you had a lot of my partners as well, so we're very excited to be on the show. My name is Julian. I'm a partner on the team. I'm based in London, but I spent a lot of time going back and forth to spend time with the rest of the team in California. And I started as a founder a very, very long time ago in high school, built companies in hardware before. And so that's why I've been investing mostly in software for most of my career. Wow, you were like, this stuff, I gotta get out of here. I was like, man, it's hard.

• 1:42:14John Coogan?

  Are you thinking about going back to hardware? Is software dead? What are you thinking?

• 1:42:20Speaker 09

  Yeah, well, I mean, two things can be true at once. I think hardware is really interesting. I'm spending a lot of time thinking about physical AI. But at the same time, I've been investing for the last 10 years in application software. So I want to remain true to that. And this is kind of the things I've been spending time on recently.

• 1:42:41John Coogan?

  Yeah, take me through your current thesis on how software is changing in the age of AI, in the age of, you know,

• 1:42:51John Coogan?

  maybe some sort of takeoff. AGI is here, according to Sequoia Capital, amongst many other people. The labs are recursively self-improving and it seems like, you know, Sam Altman made the claim that like, if you want to build a startup, you shouldn't build a company that is in the direct path, while more and more products seem to be in the path of AI and AGI. How are you thinking about the changing dynamic with software as we know it?

• 1:43:21Speaker 09

  Yeah, that's a really important question. And I think we've been listening to Sam a lot as shareholders. And recently, Just talking to our founders, a lot of them are wondering if they're just an iteration away from the models replacing what they're doing.

• 1:43:37John Coogan?

  Yeah.

• 1:43:38Speaker 09

  And it it puts us in the position of thinking, what is coming next? What what is going to be defensible?

• 1:43:43John Coogan?

  Yeah.

• 1:43:44Speaker 09

  And for us, we we've been making that prediction last week that the next trillion-dollar company will be a software business that masquerades as a services firm. And we shared that thesis with with everyone online. The the reality is, if you sell tools today, you're really in the line of sight for the models. And you're effectively competing with the next generation that they're they're going to launch. Whereas if you sell the work, you're actually benefiting from what the models are doing and all the billions of dollars that are going towards AI. So part of that prediction was saying, for every dollar that's spent on software, six

• 1:44:29Speaker 09

  dollars are spent on services.

• 1:44:30John Coogan?

  Sure.

• 1:44:31Speaker 09

  Until now, we could only really go after the one dollars because we were building tools. Now that we can actually deliver outcomes, companies should think about capturing those six dollars instead.

• 1:44:43John Coogan?

  So the, I mean, the obvious, like, first step is just get to outcome-based pricing, move away from a seat-based model, probably. Would you agree with that as sort of like the most immediate change in business structure that needs to happen? Or if you're starting a new company, maybe don't start with seat-based pricing on day one? Or is the, like, seat-based pricing is dead? Maybe maybe that's like an overblown characterization? How do you how do you think about just like the business model moving forward?

• 1:45:15Speaker 09

  Yeah, we we think both can work. They just serve different purposes.

• 1:45:19John Coogan?

  Okay.

• 1:45:20Speaker 09

  We have companies in our portfolio that start as these co-pilots, right? That are helping the workers. And then we call them autopilots, the one who, you know, do everything end to end. Many of them are transitioning from co-pilot to autopilot to to do what you're describing. A company that comes to mind is a business called Sierra that was started by Brett Taylor that basically helps companies with customer support, which is Pretty direct bullseye use case of AI. And in this example, they're actually charging the customers per outcome, right? Per resolved ticket. And so if you spend twenty dollars per ticket resolved with humans, they charge you, say, five dollars instead, right?

• 1:46:04Speaker 09

  And that's driving ROI for the company, it's driving an outcome that's very measurable. And so that's the first more obvious company that's really working doing that. Frankly, until recently, outside of software engineering, we haven't seen a lot of this sort of, you know, fully own end-to-end outcome driving. But the models are really progressing quickly. And for everyone who's been vibe coding the last couple of months, I think we've all been impressed that we can code a full website just end-to-end without any skills, frankly. And basically, our prediction is that this is going to happen to other categories.

• 1:46:45Speaker 09

  And we've been mapping out these categories and helping founders come up with frameworks to prioritize where to attack them and how to do it.

• 1:46:53Jordi Hays?

  Yeah. Sorry to interrupt. One thing I'd be curious to get your take on. So if a company is just selling enterprise software that helps people accomplish a task, that feels very threatened by, you know, a foundation model company that maybe makes an agent that can also do said task and then you don't even need the software. So if a company transitions to just selling, selling the work, selling the service, like you're saying,

• 1:47:21Jordi Hays?

  you would agree that they're still going to be under threat from the labs, who will also presumably be selling intelligence or agents that can go and do the work. But you're saying it will maybe be more closer to a fair fight. Is that, is that the right way to think of it? Because I still think, let's say if somebody is like spinning up a, instead of making a legal AI tool, they make an AI-native law firm and they're selling the work. I could still go to a ChatGPT, a Claude, a Gemini, and a future version of the model, I can just say like, hey, I need to do this thing, can you help me do it? So there's still going to be that competition. But you're saying that's a much better sort of competitive environment to be in than just selling like

• 1:48:06Jordi Hays?

  the software that enables somebody to do the task. Is that, is that roughly right? Or is there something I'm missing?

• 1:48:14Speaker 09

  Yeah, I'll just add one framework that I think is helpful for people to clarify what that means. Basically, everyone is conflating the model's intelligence with what humans are really good at, which is judgment. And I think if you strip those two concepts, that you really understand what the future will look like. And so, right now, the models are becoming really good at everything intelligence-related. So, think of tasks that are, you know, rules-based, where just logic gets you to the goal, right? Whereas, the judgment is everything the humans really spike at, which is more harder to define, right? It's instinct, people call it taste, call it experience.

• 1:48:59Speaker 09

  And those things are things we think the humans will remain really good at for a very long time, until intelligence is able to absorb these skills into it. But it's just really hard, right? Because we give the models a lot of credit for their intelligence, but they're just trained on set amounts of data. And so, we actually think that this hybrid motion of coupling the intelligence from the model with the judgment from the humans is going to help you build the next generation of companies, which we call these autopilots, right? So, to your example, in the law firm, you will automate a lot of the intelligence work that's very much codified, which is what the model will do. If you put the employee at the center, someone who's really experienced, who can talk to

• 1:49:44Speaker 09

  a jury, who can, you know, mark a pause when, at the right time, those are all the things that you learn only from real-world experience, that a top lawyer will be able to experiment, but that the models might, will omit today. Does that make sense?

• 1:50:00Jordi Hays?

  Yeah. I still, I still, I like, you know, maybe, maybe I'm too AGI-pilled, but I, but I just assume that a sufficiently advanced agent would be able to capture and accumulate, you know, the abilities to-

• 1:50:15John Coogan?

  Jordi has two AGI pills. Just talked to Dr. Alex Whistler for 30 minutes, and he's like, I'm uploading my brain right now.

• 1:50:24Jordi Hays?

  No, it's not that, but it's just the idea of like a, you know, you put a smart person into an organization where they don't have any experience and they start doing things and they start getting feedback from other humans in the organization and over time they accumulate enough knowledge and domain expertise that they're able to excel at something that even using, even using the customer service example, you know, you can, you can, you've always been able to outsource customer service and you can go work with a firm that is excellent at customer service. The alternative has always been to effectively hire a really great leader for that part of the organization, have them build out a team and a structure

• 1:51:07Jordi Hays?

  and an approach and execute something that would be a similar result. There's like a cost trade-off, but...

• 1:51:15John Coogan?

  It does feel like overall there's like maybe some pressure on the B to B to B model or like the B to B to C model. If instead of, to use your example of customer support, there was a time when, when software companies would sell Phone Tree software to, not to companies directly to do customer support, but to customer support outsourcing agencies that would then deploy that. And now you're seeing more companies go directly to like the, the, the firm that makes the, the, the customer support experience end-to-end, go directly to the company that

• 1:51:58John Coogan?

  needs customer support as opposed to having this like middle level. And it almost makes me feel like we're, we're maybe going to rotate even a little bit further into D to C. When I think about law, there's a lot of stuff where the software would go to the lawyer, the law firm goes to the person, and if the person can go straight to the law firm or the, the legal model, you, you wind up with a little bit more B to C activity, a little bit more company directly to, to the, the service provider or the technology provider.

• 1:52:29John Coogan?

  But again, this feels a little bit dependent on specific market dynamics. I'm interested to know your reaction to that, but also what does hold in your mind in the near-term AGI scenario? Because there's been a lot of debate over how will marketplaces perform? Or are network effects still super sticky in a world of AGI? Or what are the powers, the seven powers?

• 1:52:56Jordi Hays?

  Yeah, I guess part of it, to kind of close out my thoughts. It's like, I agree with the entire thesis in like the relative short term, like the one to two years. But then beyond that, there's still some uncertainty.

• 1:53:09John Coogan?

  There always is, yeah.

• 1:53:11Jordi Hays?

  Around, like, I don't think it solves the sort of discount that even traditional SaaS companies are getting.

• 1:53:20John Coogan?

  Sure, sure, sure, yeah.

• 1:53:22Speaker 09

  On that point, I think you're right. And basically what we realize is that no one really knows. I've been in many partner meetings recently where everyone just is astonished at how quickly things are moving. I've been doing that for 10 years and it's just by far the fastest rate of change I've noticed. But some of my partners, you know, Alfred Lin, Pat Grady, they've been doing that for a lot longer and they also acknowledge that everything is moving so quickly. And so what we're trying to figure out is also not what is going to change, but what are the things that will remain true no matter what, right? Customers will always want things faster, better, cheaper, right? And so that's kind of the thesis that we're describing.

• 1:54:07Speaker 09

  There are just categories that require more intelligence than judgment. And so we think that in the immediate, the ones that require more intelligence will be actually really interesting for these autopilots. Because you can have, you know, instead of having 10 humans in one AI, you have one human and 10 AIs, right? And just that that ratio is just going to shift as the models get better and are able to absorb what we used to call judgment from the humans that are, that is turning to intelligence. And just to put like a practical framework to that, you mentioned outsourcing. It's actually the best wedge right now is just to focus on outsourcing if you want to capture this services span. Because there's three reasons. The first one is that

• 1:54:52Speaker 09

  Outsourcing has already been agreed to a third party. So it's very, very easy to sell, right? Because it's already a vendor that's external to the company.

• 1:55:01John Coogan?

  Yeah.

• 1:55:02Speaker 09

  The second is that there's an existing budget that's assigned to it, which you can peg yourself against. And, and the third is that it, it's actually very straightforward to swap a supplier. It's not so straightforward to reorganize your company, right? We all talk about headcount reduction, you know, in terms of ROI, but actually putting that in practice takes time. Whereas swapping a vendor is very quick. So I actually think that, and that's the prediction is that the, the companies that will succeed very well with this autopilot model will start with where there's a lot of labor spend that's being outsourced today. We mentioned customer support. We'll mention also things like accounting, tax, insurance, and so on, so forth.

• 1:55:48John Coogan?

  Is there a world where in the next five years or something like venture capitalists truly shift away from software and go back into rare metal mining or something crazy like that? Like, I just keep, I just keep coming back to like the, like Daniel Gross, now at Meta, you know, venture capitalist. I think one of his first AGI trades, the first bet was like, in the world of AGI, is copper mispriced? And it was, it doubled in price over two years.

• 1:56:18Speaker 09

  Yeah.

• 1:56:19John Coogan?

  And I'm just reflecting on this idea that like, if the job of venture capitalist is to back software companies, that's one thing. But if it's, if it's just to allocate capital in, in a way that can have exponential upside.

• 1:56:31Jordi Hays?

  Well, the thing that I've been thinking, you said, would it, would it ever make sense to stop, stop investing in software?

• 1:56:37John Coogan?

  Yeah.

• 1:56:38Jordi Hays?

  I would hate that because we obviously love enterprise software. But it, it has been funny. A lot of people have been pushing like, you know, the models are so good, we just need better harnesses.

• 1:56:48John Coogan?

  Yeah.

• 1:56:49Jordi Hays?

  And to me, this is giving me flashbacks to early GPT days where people were like, chat, GPT is really powerful. You just need the right harness.

• 1:56:59John Coogan?

  Right rapper.

• 1:56:59Jordi Hays?

  All these like rappers.

• 1:57:00John Coogan?

  Yeah, yeah.

• 1:57:01Jordi Hays?

  That had explosive growth.

• 1:57:03John Coogan?

  Yeah.

• 1:57:03Jordi Hays?

  Very momentarily.

• 1:57:04John Coogan?

  Yeah.

• 1:57:04Jordi Hays?

  Until, and, and so I do.

• 1:57:07John Coogan?

  Most AGI pill person ever over here. I love it. But, but, but what, what do you think about, about like, you know?

• 1:57:17John Coogan?

  The more physical aspects of the job, rare metal mining, for example, does that does that seem like something people will be working on in a couple of years?

• 1:57:26Speaker 09

  Yeah, I mean, everyone's talking about the fact that energy will be the biggest bottleneck, right, to train these models. So it's very natural that you would go there. Personally, that's not really where my skill set is. So I really hope you're wrong and that we'll find other areas in between.

• 1:57:43John Coogan?

  I think the real path will be somewhere in the middle.

• 1:57:47Speaker 09

  Hopefully, right? And my way of doing things has always been to focus on talent. And so right now, I'm just always asking the smartest people I know, who do you know who's the smartest person, what are they working on? And you're right, more and more people are going more into the physical world. But right now, that probably means things like robotics and things like that. People are making a lot of money trading commodities, but that's a different world.

• 1:58:16John Coogan?

  Yeah. Who knows? Maybe that's the job of the venture capitalist in 2030, just trading copper all day long. You mentioned using AI to build a website despite maybe skills that have languished since your time in software or hardware. But how are you using AI tools these days? Are you still doing mostly like knowledge retrieval, market research for your job in venture capital? Or have you actually built tools that have accelerated certain things? Have you automated any of your workflows? I'm just kind of curious how people are using AI these days.

• 1:58:52Speaker 09

  Yeah, well, I don't know. I hope my competitors are not listening, so.

• 1:58:57John Coogan?

  They are. So you could say, I haven't touched it, actually. It's useless.

• 1:59:02Speaker 09

  Yeah, exactly.

• 1:59:03John Coogan?

  You should uninstall.

• 1:59:04Jordi Hays?

  Stick to organic, organic capital allocation.

• 1:59:07John Coogan?

  Pen and paper, actually, is underrated.

• 1:59:09Speaker 09

  Exactly. Back to the basics, pen and paper, and don't try cloud code. It's really, really great. Jokes aside, it's been really a transformation, and particularly the first quarter of this year. I mean, I use it for all kinds. You know, the work is basically sourcing picking winning company building and harvesting right then I really have workflows that fit all these boxes so it goes from things as you know at the end of the week it will just like scan my entire calendar look at all the meetings I took look at the granola notes which is a transcript um do an analysis and and help me you know try and find the key questions and the due diligence um and you know it'll help me just prioritize right because this job is

• 1:59:54Speaker 09

  just so much about prioritizing it's a power law right there's only three meetings in the year that will really that could change your the course of your career um and and so making sure that you're attuned in those meetings is really important uh so so that's really what I would say Claude has helped me do right now uh and I'm sure you know when I will really something next month that will be amazing and so on and you just have to experiment right then I think I think that's also like what we've seen with things like open claw being so top of mind is like this culture of experimentation is not just in software engineering now but it's it's transpired across the entire uh knowledge workforce um and you know venture capitalists are not an exception

• 2:00:40John Coogan?

  I love it well thank you so much for taking the time to come shout out to us

• 2:00:42Jordi Hays?

  great to meet you

• 2:00:43John Coogan?

  have a great rest of your day

• 2:00:44Speaker 09

  thanks guys

• 2:00:44John Coogan?

  we'll talk to you soon

• 2:00:46Speaker 09

  thanks for doing that

• 2:00:47Jordi Hays?

  great to hang

• 2:00:47John Coogan?

  let me tell you about 11 labs build intelligent real-time conversational agents reimagine human technology interaction with 11 labs you know I if I was a venture capitalist open claw every morning at 5am text me the name and market cap of the company that I passed on three years ago I need inspiration to grind harder that's the secret to success as is lambda lambda is the super intelligence cloud building AI super computers for training and inference that scale from one GPU to hundreds of thousands and without further ado we have Owen McCabe the CEO of their com uh a huge supporter of TVP as well welcome to the show how are you doing

• 2:01:23Jordi Hays?

  great to see you

• 2:01:24John Coogan?

  great to see you again

• 2:01:25Eoghan McCabe?

  great to see you both also

• 2:01:26Jordi Hays?

  it's been too long

• 2:01:27John Coogan?

  it's been too long

• 2:01:28Jordi Hays?

  man you have you just have a voice for for radio

• 2:01:32John Coogan?

  live streams podcasts all

• 2:01:33Jordi Hays?

  it's incredibly uh calming I love it

• 2:01:37John Coogan?

  yes I love it

• 2:01:38Eoghan McCabe?

  okay what would you like me to say I can record a meditation for us we could

• 2:01:41John Coogan?

  ooh yes

• 2:01:43Eoghan McCabe?

  kind of start up the hour that way

• 2:01:43Jordi Hays?

  do you have time do you have time to meditate

• 2:01:45John Coogan?

  ASMR funding announcement

• 2:01:46Jordi Hays?

  do you have time to meditate these days

• 2:01:48Eoghan McCabe?

  it's kind of the only thing that keeps me sane

• 2:01:50John Coogan?

  that's good Uh, well, you have some new funding for new project. Break us down. What happened? What's the plan? How much did you raise? Take us through it.

• 2:02:00Eoghan McCabe?

  Yeah, so we raised $250 million.

• 2:02:02John Coogan?

  Let me hit the gong.

• 2:02:08Eoghan McCabe?

  Did that gong get bigger since I was here?

• 2:02:11John Coogan?

  It did get bigger.

• 2:02:13Eoghan McCabe?

  It will be cool if it got bigger every, every single season, right?

• 2:02:16John Coogan?

  Fast takeoff.

• 2:02:18Jordi Hays?

  Just wait. There's a fast takeoff.

• 2:02:19John Coogan?

  There's a fast takeoff in gong size over here. It's growing exponentially.

• 2:02:22Jordi Hays?

  Except this was actually, I think, the largest we could find in the U.S. So we gotta go.

• 2:02:26Eoghan McCabe?

  Yeah, no, there's always bigger. I kind of have gong envy right now. I wish I had a gong.

• 2:02:30John Coogan?

  We'll send one over.

• 2:02:31Eoghan McCabe?

  Let's talk about that later.

• 2:02:32Jordi Hays?

  Well, we'll talk. We'll talk.

• 2:02:33John Coogan?

  So $250 million. What's the plan?

• 2:02:36Eoghan McCabe?

  Yeah, yeah. So, I mean, we've been building this thing called Finn for three years now. Service was just this obvious place where AI was gonna, you know, blow up. And also, everyone else started to chase it. We were about a year ahead of everyone else. And we started doing, you know, customer queries and then more complex problems. Originally, it was answering questions for customers, and it's fantastic, you know? The typical response rate with a human was one to two days. You'd have to deal with the beautiful imperfections of humans. Unfortunately, these bots are just far more perfect than humans, and they answer in seconds. And of course, they're cheaper too. So we, we started to say better, faster, cheaper. These things are really better, faster, cheaper. So that was a tremendous success.

• 2:03:18Eoghan McCabe?

  Finn is the biggest service agent in our category, nearly 100 million A R O, 80% paying customers. You know, some of the biggest, lowest in the game. Thank you from Anthropic to, I don't know, Snowflake, the cool guys like Polly Market and Vent, and everyone else around Finn. Um, so wonderful. Um, but where does it go next? You know, clearly, it's just so obvious as each of these categories develop that there's just more to explore. There's none of these categories are in any way fully baked. And that's one of the interesting things about kind of all these AI spaces that we're still kind of pulling the thread and seeing what's going to show up next. And the next big play for Finn is not just answering service queries, but really getting deep into every stage in the customer lifecycle.

• 2:04:02Eoghan McCabe?

  And so we call that the customer agent, and this money will primarily bring the customer agent to market.

• 2:04:07John Coogan?

  Okay, so when I

• 2:04:10John Coogan?

  Want great customer service for a company that I'm running. I want, yeah, you know, search the knowledge base, answer the obvious questions, handle the refunds, track. That's part of the customer journey. Are there other touchpoints that are unlocked by AI along that journey?

• 2:04:28Eoghan McCabe?

  Absolutely and completely. Yes. From day zero on the website, when the customer has very basic questions and they get more interesting. When the business wants to start to qualify and understand who that customer is. When the customer actually then wants their hand held when they sign up or they want to actually engage and learn and meet salespeople. They want to book a demo or they want to talk to a virtual salesperson. I mean, that's just the very top of the funnel alone. But to get into the application, if it's B to B, there's all the onboarding, all the detailed help required to get something successful. If it's e-commerce, it's actually buying products and getting it into the cart and bringing them back for more shopping. So there is really the, literally the full customer lifecycle of work to be done by agents.

• 2:05:11Eoghan McCabe?

  And customer service was just the little sliver. I want to know what's happening off camera though.

• 2:05:17John Coogan?

  Oh, we just have our next guest walking in into the studio.

• 2:05:21Eoghan McCabe?

  So I'm just Hopefully they're less interesting to me.

• 2:05:23John Coogan?

  Yes. I want to talk about some of the best customer service agents that I've hired have sort of wound up Real people. Real people have wound up in sales roles almost like they have a fish on the line. They're reeling them in saying, you don't want to cancel. We actually, this product does exactly what you want. And that the fact that it was delivered one day late, we're happy to refund you. But it seems like the underlying issue is that you actually want this product. So this product, why don't we get you over here? And that's this like sort of different skillset that comes out in the best customer service agents. How are you thinking about actually driving incremental sales through customer service agents?

• 2:06:08Eoghan McCabe?

  Yeah, I think one of the interesting things is that a lot of the work in these functions isn't entirely separate. We just needed to draw lines between them when we were running human organizations because you can't possibly have one person who's outstanding at service, sales, marketing, success, et cetera.

• 2:06:23Jordi Hays?

  Yeah. And the SaaS market would make the SaaS market maps too complicated.

• 2:06:28Eoghan McCabe?

  Totally. A pain in the ass. But unfortunately, that pain in the ass is coming with AI because I just don't believe you're going to have these separate sales agents and marketing agents. You're not going to have these things fighting with each other, having different context and information, different memory in different parts of the customer lifecycle, different messengers, not going to happen. There's going to be vendors that will provide one seamless solution across the customer lifecycle. And that's a big thing we're passionate about. And one of the very fascinating things we've seen, we've been building this for quite a number of months now, and we're going to launch the first part of it next month. One of the fascinating things we've seen is that when there's an underlying relationship

• 2:07:11Eoghan McCabe?

  with the agent, and then there's actual connection in the moment, and then there's clear intent, the context is primed for selling and encouraging the user to do something next. If you're on a website and you get a super annoying pop-up that says, hey, John or Jordy, in fact, they're not even going to use your name. They're going to say, do you want to learn more about our whatever? And you're like, get out of here. It's like not the right time or place. Whereas if you're actively discussing, it can ask you questions back, and it's so much more effective. And so we've seen just these things, the service agent, when it starts to do sales, for example, and vice versa, they're far more effective.

• 2:07:55Eoghan McCabe?

  And so the real magic from AI across the board, and of course, this agent world, is going to be when the agents can do things that humans can't.

• 2:08:03Jordi Hays?

  Yeah, one thing that stands out is like, right now, you have this spikiness in dialogue as a customer of a business, right?

• 2:08:11Eoghan McCabe?

  Right, exactly.

• 2:08:12Jordi Hays?

  You might have a question coming in, and it like creates a moment, and then it goes away. And then you get maybe transition to someone else, and you're talking to a real human. You talked with them a little bit, and you get passed to someone else. And like, there's something about creating, I think, the customer experience of having this continuous conversation with the organization that you're a customer of, that I think will be super powerful because it just means that... You know, a split second away the entire time. I I was talking with some guys that owned a number of like big car dealerships recently. And I was talking to them about AI and they weren't fully sold yet because they they use like chat GPT. But but they haven't had anything spread across their whole organization.

• 2:08:55Jordi Hays?

  And I was explaining to them how there's so many different moments where like a customer lands on their website. And they want to know if a car is available, but somebody gets back to them too slowly. And like they they the light was like finally going off for them. Do you think that there's a number? How many industries out there have been kind of resistant to even using software from Silicon Valley to date? That are going to kind of take a second look at all the different tools and things like Finn? Now that they maybe have had a cool experience with AI in their in their personal life. And they're basically saying they're they're willing to kind of look because maybe the the historical SaaS platforms, they tried them. But it wasn't quite magical yet.

• 2:09:41Eoghan McCabe?

  Yeah, there'll be so many spaces, so many verticals that some smart entrepreneurs will benefit from bringing sexy technology to that aren't immediately obvious to those of us in Silicon Valley. You know, we tend to sell to ourselves. It's really insular. So all the names I just mentioned there, like Anthropic and Snowflake, they're all the cool brands in our world. However, there's like car dealerships that are, you know, I don't know, maybe it's not as big as Anthropic, but they're pretty damn big.

• 2:10:10John Coogan?

  Depending on the car dealership, I I would put car dealership above Anthropic and Snowflake personally. If it's like a Ferrari dealership, Lamborghini dealership, like just on the cool side, we gotta give it.

• 2:10:19Eoghan McCabe?

  On on on the aura factor, sure.

• 2:10:22John Coogan?

  For sure.

• 2:10:22Eoghan McCabe?

  Maybe not on on the economic factor.

• 2:10:25John Coogan?

  Yeah.

• 2:10:25Eoghan McCabe?

  But there are, there are so many industries that just don't have our attention. And so there will be, you know, there'll be companies like ours selling to many verticals. But really, you know, we'll focus on all of the verticals that are adjacent to ours. And there's, you know, tens of billions of dollars of opportunity just in that alone.

• 2:10:42John Coogan?

  Yeah.

• 2:10:42Eoghan McCabe?

  But there'll be people who will say, we're going to make gadgets for dentists, car dealerships or certain government bodies, maybe even for tax bodies. Like there'll be people who'll do this because. So much of the effort is not just in building the technology, it's actually creating the trust, as you say, Jordy, with the actual people who will have to deploy this technology and make it work for them with their legacy system. So there's a lot of very unsexy work that will be rich and rewarding for some people who bring it to these places.

• 2:11:12Jordi Hays?

  Talk about the decision to raise debt instead of equity, not something you see.

• 2:11:17Eoghan McCabe?

  Yeah, I mean, yeah, I know. I just realized I had this kind of blind spot for this as an option for for capital. And there's just so much equity opportunities out there. We raised a bunch last year for a secondary. But

• 2:11:35Eoghan McCabe?

  when you're in our dynamic where you're accelerating as quickly as we are, like every every year, we're doubling our our rate of growth, pretty much. There's no way we're going to be able to achieve our the valuation that we're pretty confident we'll get next year. And so any equity raise is going to just be massively dilutive. We calculated that raising this in debt is going to cost us about a tenth the kind of price to shareholders that it would cost in equity. So this is, you know, the incumbents have disadvantages. They tend to move a little slower. They have older businesses they need to wrangle with. But they have access to an abnormal amount of debt, like 250 million is a relatively small amount of debt for the size of our business. And I think that you're going to

• 2:12:20Eoghan McCabe?

  start to see a lot of these older SaaS companies as they pivot to AI and they actually find new growth, start to lean on debt as an opportunity to invest rather than, you know, super dilutive equity. And honestly, I just think it takes a little bit of maturity to take that route. There's so much pressure from employees.

• 2:12:40Jordi Hays?

  It's confidence.

• 2:12:41Eoghan McCabe?

  Yeah, to know your business. Well, I like to think so, but the reason I say maturity is that there is so much temptation to go and attain that latest, hottest valuation. Your employees want it, your previous investors want it, media wants it. But if you're able to tell them, we don't need it, actually, it's way cheaper for us to get a lot more capital with far less effort, then you can actually thread a needle in a way that I think is going to work much better for big companies like ours.

• 2:13:12John Coogan?

  The gong over here rings just as loud for debt as it does for equity. So don't let the media tell you.

• 2:13:17Jordi Hays?

  You guys are hiring a ton. You said you're bringing on 650 new people this year?

• 2:13:23Eoghan McCabe?

  Yes. Yeah. So that's gross. I think net it'll be a little less than that. It's a phenomenal amount of hiring. I fear it. I celebrate it with great caution. There are just countless stories of the hubris of CEOs who've posted about how many people they've hired and it's all ended in tears. So it's actually not a point of pride, frankly. I think small is beautiful, but we are growing incredibly fast and we need all the help we can get.

• 2:13:54John Coogan?

  And you've been at this long enough to know the impact of what, 100 people, 600 people, what impact that will have on your organization. So I have the full faith in you.

• 2:14:08Eoghan McCabe?

  Thank you for that.

• 2:14:09John Coogan?

  Thank you so much for taking the time to come chat with us.

• 2:14:11Jordi Hays?

  Great to see you.

• 2:14:12John Coogan?

  Congratulations.

• 2:14:12Eoghan McCabe?

  Good to see you both.

• 2:14:13John Coogan?

  Well, talk to you soon.

• 2:14:14Eoghan McCabe?

  Take care. Keep doing your thing. All the best.

• 2:14:15Jordi Hays?

  Amazing stuff.

• 2:14:16John Coogan?

  Goodbye. Let me tell you our railway. Railway is the all-in-one intelligent cloud provider. Use your favorite agent to deploy apps, servers, databases, and more while Railway automatically takes care of scaling, monitoring, and security. And let me also tell you about Sentry. Sentry shows developers what's broken and helps them fix it fast. That's why 150,000 organizations use it to keep their apps working. And without further ado, we have Alex Epstein. He's the author of Fossil Future, live in the TVP and Altrudum. Welcome to the show. Good to see you. Thank you so much for coming down on short notice.

• 2:14:47Jordi Hays?

  What are your texts been like the last 48 hours?

• 2:14:50John Coogan?

  This is over.

• 2:14:52Jordi Hays?

  Because you're, because John and I were... Thinking, who's our oil guy? We had one, we had one.

• 2:14:59Alex Epstein?

  Yeah, I'm local too. Yeah, if I'm in town, it's great. I always like coming in person versus

• 2:15:04John Coogan?

  Thank you so much.

• 2:15:05Jordi Hays?

  So much better.

• 2:15:05Alex Epstein?

  The other stuff, yeah.

• 2:15:06John Coogan?

  Appreciate it.

• 2:15:07Alex Epstein?

  So I got lots, I mean, there's so much in energy, but

• 2:15:09John Coogan?

  I'm happy to just let you lead the conversation however you think it should go. What are, what's going on? What, what, how should we even be thinking about oil prices right now? The impact of the war in Iran? How do we, how should we be processing this news?

• 2:15:27Alex Epstein?

  Okay, so we did this, so there's a million things to comment on. So I'm going to try to segment what I comment on. But we did get involved militarily in Iran, which I would just say in my non-area of expertise, in general, that is a good idea. I think it's a better idea to have Congress involved if you can get them involved. And I think it's a good idea to have a lot of expertise on international oil markets being brought to bear.

• 2:15:54John Coogan?

  Sure.

• 2:15:54Alex Epstein?

  When you do this. And I think this administration does a lot of good stuff on energy. But I think it's pretty clear at this point that there was not maximum expertise brought in on this. And so the, the standard issue when you're talking

• 2:16:07Jordi Hays?

  And like indicators there would be like the Strategic Petroleum Reserve hadn't been refilled.

• 2:16:12Alex Epstein?

  I mean, we, we can talk about that. So let's, let's make sure to get back to that one. But the main thing is just, you know, rough numbers. You know, Strait of Hormuz, which Iran has control over is 20% of the world's oil production is flowing through that every day. And so whether you're looking backward or looking forward, there is no replacement whatsoever for opening that strait and keeping it open. And one of the things we've heard from different people is, oh, we have a lot of options on the table. Like, there's a lot of things that we can do. There are definite things that you can do, but none of them is 20 million. Right? So it's just, I mean, that's, that's more than US oil production just flowing through that one place. So there, yeah, we can talk about the other things.

• 2:16:55Alex Epstein?

  But I think the first thing people need to recognize is if you do not get that thing open, then you have dramatically higher oil prices. And then the other thing to get is oil prices really matter.

• 2:17:06John Coogan?

  Straight from muse, on the Strait of Hormuz, dumb question, can't you just go around?

• 2:17:11Alex Epstein?

  I mean, you can, you can try to some extent, but there's a reason why 20 million a day are being routed through. Because it actually comes out of there as well, right? Yeah, there's just, I mean, all of these things are very, very optimized. One of the thing about just understanding the energy industry is like, things are just very optimized in terms of where the infrastructure is. You're doing all of these things. So it's, there are other, and we'll talk about this. I mean, there are certain pipelines, you can pipe more oil through their alternate routes, but we're talking even the millions a day, maybe. Yeah. Most of our other options are sort of in the one to two million barrels a day. Sure. And just so people know barrels, 42 gallons, so you're talking about almost 100 million gallons a day for this stuff. But yeah, so, so you don't have a lot of great options. And I think that's, that's very important for, I'm going to give some options, but the

• 2:17:56Alex Epstein?

  number one option is keep that thing open. And there are basically two ways to do that. One is you just win the war, if you want to call it that a lot more quickly. Like if you get some form of surrender and you have friendly people controlling it, then guess what? It can open. That's one thing. And so I'm not an expert on how to do that, but schematically, doing that is very effective. The other thing, which is a little bit-

• 2:18:21Jordi Hays?

  But game, game theory for Iran is they actually benefit from global markets being in turmoil because it gives them some leverage over, over any type of negotiation.

• 2:18:35Alex Epstein?

  I mean, this is the biggest damage that they can do. I mean, clearly we've seen they're not going to do, you're not going to send missiles to Israel and get rid of Israel, let alone do anything to the US. But they have this incredible control of the, one of the centers of the world economy. And they have a bunch of stuff going on there. So let's talk about that. So option one is you get a surrender and they don't use all of their options. But then let's talk about their options. So they have mines in this thing. So they can blow up mines. They have missiles. Maybe the worst thing they have, and this is a change in recent years, and you've had Palmer on here and Ethan on here, like the drone thing is just a total- Game changer because you can have a small vehicle, you can launch one of these, you know,

• 2:19:17Alex Epstein?

  Shaw heads out of the back of a truck, they can go really far and that's a lot harder to deal with than a fixed installation.

• 2:19:24Jordi Hays?

  Yeah, they have something like 500 miles of range on a typical.

• 2:19:28Alex Epstein?

  Yeah, depending on, yeah, right.

• 2:19:30John Coogan?

  Truck drives up to a beach, drone launches as soon as it finds that cargo tanker that has a bunch of oil on it and hits it.

• 2:19:36Alex Epstein?

  Yeah, and then, and then there's the, you're, you're worried about that.

• 2:19:39John Coogan?

  Sure. As you're not even gonna go.

• 2:19:41Alex Epstein?

  As, as you're going through. So you have, you have to think about, those are the kinds of threats you face. So how do you deal with that? I mean, basically you need the US to lead some sort of convoy where people have sufficient security and economic assurances that it'll go through. So what's involved in that? Well, one thing is, if possible, you want to get allies involved and it's, it's even possible you get unconventional allies like China who has, well, they depend on this. Now, they have a bunch of, unlike us, you want to go back to SPR, they've been filling up their reserves. So they have more reserves relative to their imports than we do relative to ours. If you think about ours, we have about 400 in the SPR and we can release about 4 million a day.

• 2:20:22Alex Epstein?

  So we don't have as much, but, but still, they, they really care about this and a protracted thing is bad. So, but for sure, Japan, South Korea, India. So one thing is just at a high level, if you're doing this convoy, can we get these countries that are aligned economically, maybe China, but definitely these others? Can we get them involved? Because then it's an addition, they have military presence there. That's an additional threat to Iran if they attack one of their ships. So, but that's a macro thing is just can you do this alone or can you do it with allies? I think ideally you would do it with allies. Then there's a question of what you do about these, these various things. And I think the biggest, I mean, the other macro thing you can do is just in some way credibly threaten Iran and say, hey, if you.

• 2:21:06Alex Epstein?

  And I can't give the details of how to do it, but if you attack us, if you attack in the Strait of Hormuz, it's going to be very, very bad for you. So just at a high level, can you make that threat? So they understand this is going to be very, very, now, you know, wiped out a couple of layers of leadership. So they might be taking these things seriously. After that, I think the biggest thing from what I've heard from military experts is just these drones. Like, what do you do about these drones? How do you give any kinds of assurances? And as far as I can tell, we don't have any one perfect solution, but you can do a certain amount of stuff from the air. You can do a certain amount of stuff from the ground, although it's very, very expensive. And then most cost effective where you can do it is you can take

• 2:21:48Alex Epstein?

  out certain stockpiles and facilities with the proviso that these things are decentralized. And of course, I have no specific knowledge about where they are.

• 2:21:54John Coogan?

  But in theory, if there's the suicide drone, the Shahed, that's there's a factory and you take out that factory, you have reduced that.

• 2:22:02Alex Epstein?

  Right. So that's going to be it. And you know, I know you guys had on Ethan Thornton, who I'm friends with, and, you know, he talks about this a lot, is just this cost asymmetry issue, is you just want to be doing things, even if you're way wealthier, you do not want to be spending $3 million to take out $30,000.

• 2:22:17John Coogan?

  Which might be what's happening with a Patriot missile.

• 2:22:20Alex Epstein?

  This, this, this, yeah, that's the kind of thing that happens. So you need, you need a combination of those kinds of things. And then the other thing, so that's all the security stuff. So you get the allies involved, you take these actions specifically against drones. I think the, what was I going to say about the, the other thing you can do, I'm just make sure.

• 2:22:38John Coogan?

  They're still just.

• 2:22:39Jordi Hays?

  Well, like the other big.

• 2:22:40Alex Epstein?

  Oh, the insurance.

• 2:22:41Jordi Hays?

  Okay, insurance.

• 2:22:41Alex Epstein?

  Yeah, the insurance. So, and this, this has been floated by the president, and it's a reasonable idea, but my understanding is the insurance vehicle we have, the Development Corporation, does not have enough funding. So you might need to go to Congress. But basically, you want to be able to say, hey, you, it's, we're going to lead this as the United States. We're going to lead it with allies. If Iran does anything, it's big trouble for them, and we can counter their specific attacks. And if something goes wrong, you're insured. You're trying to create that confidence to get enough people going through, and then you get a certain amount of stability, and then you start to get closer to your 20 million barrels a day. Either that, or you just defeat them really quickly, or both.

• 2:23:19Jordi Hays?

  So, so the other factor is just the loss of production, disruption to production, plants shutting down, plants being damages, damaged.

• 2:23:30Jordi Hays?

  How does that factor in? Do refineries get brought back? And I'm talking about an allied country.

• 2:23:39Alex Epstein?

  You mean just the trend over time or what?

• 2:23:41Jordi Hays?

  Yeah, generally, I mean, just seeing the videos coming out. You've seen places, I think, like Qatar, Kuwait. Yeah, basically just saying like, yeah, we're going to pause production because we don't even have a place to store this. And/or they're suffering damages. And it doesn't make sense to keep refineries online.

• 2:24:01Alex Epstein?

  This is all, but this is all just downstream of do you have the route open?

• 2:24:05John Coogan?

  Yeah, got it.

• 2:24:06Alex Epstein?

  Like, if you have the route open,

• 2:24:07John Coogan?

  Then you're good.

• 2:24:08Alex Epstein?

  It solves everything. If you don't, the way to think of the other things, so we do have some other interesting options. We have to think of them as these are temporary stopgaps. Like, if anyone says, I mean, you hear some crazy things. People are like, oh, Venezuela. And we talked about this last time. Venezuela is less than a million. I mean, it's beyond crazy. It's just impossible. It's not like Venezuela has the ability to just increase their oil production by any significant amount in the near future. I mean, we're talking about companies considering going in harm's way to get some incremental boost. So Venezuela is essentially useless.

• 2:24:39John Coogan?

  So best case scenario, in the next year, Venezuela goes from under a million to 2 million?

• 2:24:44Alex Epstein?

  No, I mean, 2 million would be, I mean, if we made it our entire goal in life, I don't know. But why would you for that?

• 2:24:51John Coogan?

  Venezuela was at like 3 million, like?

• 2:24:53Alex Epstein?

  Yeah, yeah, some, yeah, some years ago. Yeah, yeah, right, but there's so many.

• 2:24:57John Coogan?

  But there's a lot there. It's not gonna happen.

• 2:24:59Alex Epstein?

  It's just, yeah, so Venezuela, I would not even, that's just in the category of, it's not even a bad idea. It's just not an idea. There's nothing, there's nothing, there's nothing there.

• 2:25:09John Coogan?

  No, no, that's right.

• 2:25:09Alex Epstein?

  So the bad, the bad ideas, by the way, are, the worst idea imaginable is ban oil exports from the United States, which I have heard floated in conversation.

• 2:25:18John Coogan?

  Seems somewhat reasonable. I want the oil.

• 2:25:20Alex Epstein?

  Yeah, of course, because we have oil, so we don't want to sell.

• 2:25:24Alex Epstein?

  I mean, so many different things, but one obvious one, not obvious one, but it's obvious if you know how these things work is the refiners in the US do not match up well to the oil produced in the United States. The refineries in the United States are based on heavier crude, like crude is rated in terms of weight and sourness.

• 2:25:42John Coogan?

  Okay.

• 2:25:42Alex Epstein?

  And so our refineries are mostly for heavier crude. It's actually one reason why Venezuela has some appeal. Canada has a lot of appeal.

• 2:25:49John Coogan?

  Because they have heavier crude.

• 2:25:50Alex Epstein?

  Yeah, and we're going to talk about Canada.

• 2:25:51John Coogan?

  And we're good at refining it.

• 2:25:52Alex Epstein?

  We're good at refining it.

• 2:25:53John Coogan?

  But we produce a lighter crude here.

• 2:25:54Alex Epstein?

  Yes, because the shale revolution was just this dramatic shift.

• 2:25:57John Coogan?

  Yeah.

• 2:25:58Alex Epstein?

  Very quickly in oil production. So our refineries are not primarily equipped. That's why when we ended the crude export oil ban, I forget, it was 2014 or something like that, it was just this huge unlock.

• 2:26:07John Coogan?

  So.

• 2:26:07Alex Epstein?

  Because it allows the global market, it allows us to produce for a global market.

• 2:26:11John Coogan?

  So you can't, you can't look at American oil production as a monolith.

• 2:26:14Alex Epstein?

  Yeah, it's not, it's not fungible.

• 2:26:15John Coogan?

  We import heavy crude and export light crude. Is that roughly correct?

• 2:26:19Alex Epstein?

  Yeah, that's roughly correct. Yeah, yeah. So that's one thing is it's just insane to do that. But in general, think about it. What is the value of higher prices? Is it stimulates production? We're going to talk about all these different ways where we want to unlock oil.

• 2:26:31John Coogan?

  Yep.

• 2:26:32Alex Epstein?

  So you want to tell American oil producers, hey, we're going to actually totally screw you over. It's actually going to be worse for you maybe than it was before.

• 2:26:38John Coogan?

  You're going to produce less.

• 2:26:38Alex Epstein?

  Because you don't even have a market.

• 2:26:39John Coogan?

  Yeah.

• 2:26:39Alex Epstein?

  So you're going to strand all this oil. So that's, that's terrible. There's also this financial manipulation idea, which has been floated. I think it's terrible of, hey, let's manipulate the financial markets basically in a way that we're, you're selling futures short on a certain time period and then you're buying them. What you're trying to do is lower the near-term price.

• 2:26:56John Coogan?

  Oh, like Fed, like Fed policy, basically.

• 2:26:58Alex Epstein?

  Or Treasury, yeah.

• 2:26:59Jordi Hays?

  It's a very American way to try to solve a real-world problem.

• 2:27:03John Coogan?

  A lot of people that like that.

• 2:27:04Alex Epstein?

  The only solutions involve unlocking oil in one way or another. You do not want to screw up the markets.

• 2:27:10John Coogan?

  Okay.

• 2:27:11Alex Epstein?

  So that people are less inclined to unlock oil, nor do you want to screw up the markets to destroy information. So again, the main unlock is reopen that straight. There's no way around that. But then we can talk about other things. So one category is what you call spare or emergency capacity.

• 2:27:28John Coogan?

  Okay.

• 2:27:28Alex Epstein?

  And this is, there's some uncertainty here, but it-

• 2:27:31John Coogan?

  Quickly, this is separate from the strategic reserve?

• 2:27:34Alex Epstein?

  Yeah, yeah. So, well, emergency capacity is the strategic reserve.

• 2:27:36John Coogan?

  Oh, it is.

• 2:27:37Alex Epstein?

  So spare means you could be, you could pretty easily be producing more per day, but you're not because you're not happy with the price. And this is mainly Saudi Arabia is considered Exhibit A in terms of amount of this. Now, there's debate among experts about how much they have.

• 2:27:52John Coogan?

  Yeah.

• 2:27:52Alex Epstein?

  But, you know, some people estimate they have one, two, three million barrels a day of spare capacity. They could ramp up on some kind of-

• 2:27:58John Coogan?

  And do they know how much capacity they have and they're just not sharing it? Or does no one know?

• 2:28:03Jordi Hays?

  I mean, that's always been the story, that's been the story of the Gulf, right? They're not gonna, if they just flooded the market with every single barrel that they could possibly produce, they would be getting a worse, a much worse price.

• 2:28:14Alex Epstein?

  Yeah, and there's this cartel arrangement that does. I mean, in a sense, everyone has this on different time scales. You think about US shale producers. If prices were sustained at a hundred dollars, guess what? There's a whole bunch of shale deposits that they could produce at seventy-five dollars a barrel and make a fortune on that they're not gonna do-

• 2:28:31John Coogan?

  Got it.

• 2:28:31Alex Epstein?

  -four weeks ago when it was around sixty dollars a barrel. But, but in terms of, the thing about the Saudi oil is it's produced at a much lower cost.

• 2:28:38John Coogan?

  Okay.

• 2:28:39Alex Epstein?

  So this is them saying, hey, we have some of this on the table. And then the question is, you need to be able to produce it, and then you need to be able to transport it. So you have estimates around maybe you could get one to two million barrels a day.

• 2:28:51John Coogan?

  Yeah.

• 2:28:51Alex Epstein?

  So that's one of them. In terms of emergency, if you look around the world, you don't have a lot of immediate spare capacity besides that. So we have what's called emergency capacity or strategic petroleum reserve. You know, it's, Jordy mentioned that we didn't fill up our strategic petroleum reserve. I think this is unequivocally a mistake. I mean, if you look at, the whole thing of the strategic petroleum reserve is you want it for when you need it, and the best possible time to fill it up is when prices are low.

• 2:29:17John Coogan?

  And is that physically a place with a bunch of barrels that we-

• 2:29:21Alex Epstein?

  There's a bunch of different parts of it.

• 2:29:22John Coogan?

  It's like the Fort Knox of oil?

• 2:29:24Alex Epstein?

  Well, there's multiple different places. But, but you can think of it roughly that way.

• 2:29:28John Coogan?

  But we basically cache the physical oil in America or somewhere we own it. Or can access it.

• 2:29:32Alex Epstein?

  Yeah, yes.

• 2:29:33John Coogan?

  And it's sitting there going unused until we're.

• 2:29:36Alex Epstein?

  Yeah, now there's issues of Biden Biden definitely misused it. So they they used it to basically have lower gasoline prices during midterm elections.

• 2:29:45John Coogan?

  Okay.

• 2:29:46Alex Epstein?

  Even though parenthetically, their entire policy goal was get rid of fossil fuels, which means you want the price to go up. So people can't afford it.

• 2:29:52John Coogan?

  Yeah.

• 2:29:52Alex Epstein?

  It's a very cynical kind of move.

• 2:29:54John Coogan?

  Got it.

• 2:29:54Alex Epstein?

  They did it in a way that degraded the facilities. So let's say we're at about 4 million barrels a day. We can get out of that thing. We have 400 million in there. We should have over 700 million. We could have easily filled it up. I mean, it was a perfect time when you're talking about $50 a barrel oil, $60 a barrel of oil.

• 2:30:09John Coogan?

  Yeah.

• 2:30:10Alex Epstein?

  Now, it's.

• 2:30:10John Coogan?

  And can I do the basic arithmetic of 4 million a day, 400 million in the reserve, 100 days of oil? But that's not actually if we're talking about like relieving price pressure, you could you could trickle it out over a year and have 120 or 1/4 of the effect.

• 2:30:28Alex Epstein?

  But just think about 100 million dollars a day, 100 million barrels a day is roughly the global market.

• 2:30:32John Coogan?

  Okay, okay.

• 2:30:33Alex Epstein?

  So 4 million is just that's its maximum.

• 2:30:35John Coogan?

  Throughput.

• 2:30:36Alex Epstein?

  Capacity.

• 2:30:36John Coogan?

  Got it.

• 2:30:37Alex Epstein?

  It's kind of an analogy to batteries.

• 2:30:38John Coogan?

  Sure.

• 2:30:38Alex Epstein?

  We're talking about batteries. So there's a certain amount like with a battery. If you hear there's a 4 gig, there's a 1 gigawatt battery installation. That means that's the it usually means there's 1 gigawatt for 4 hours.

• 2:30:49John Coogan?

  Sure.

• 2:30:49Alex Epstein?

  But if you wanted to do half a gigawatt, then you could do 8 hours.

• 2:30:52John Coogan?

  Yeah.

• 2:30:52Alex Epstein?

  Right?

• 2:30:52John Coogan?

  Yeah.

• 2:30:53Alex Epstein?

  It's the same deal with this.

• 2:30:54John Coogan?

  Okay.

• 2:30:54Alex Epstein?

  But keep in mind, this is not 100 days of US oil demand. And by the way, for the refinery reasons, we can't just supply it all with our SPR. It's just the maximum output is but you know, 4 million barrels a day is something we're talking. That's 1/5 of what's flowing through the street of Hormuz. So if, yeah, it's it's a thing. But but yeah, you can think of, yeah, maybe we'd be willing to do 1 to 2 million barrels a day from ours. Now, interestingly, the International Energy Agency, we are part of the International Energy Agency Reserve Program. So we have about 400, but they have about 1.4 400 million. They have 1.4 billion. So we have allies around the world.

• 2:31:31John Coogan?

  Okay.

• 2:31:31Alex Epstein?

  That can also release this oil. So maybe we could get 1 to 2 million from them. Now, last, at least last I checked the news, they hadn't agreed to do this because they don't think it's an emergency.

• 2:31:40John Coogan?

  Sure.

• 2:31:40Alex Epstein?

  But that's what it's there for.

• 2:31:42John Coogan?

  Yeah.

• 2:31:42Alex Epstein?

  So notice the pattern is.

• 2:31:43Jordi Hays?

  At what point would they think it's an emergency?

• 2:31:46Alex Epstein?

  I don't know. I mean, and we, you know, we can put pressure on them. I think, I think some of these determinations have to be made in conjunction with the military determinations. You can't make them in isolation. Because if you think about what's the military objective? How close are we to that? Or how close are we at least to opening this up via? High security and financially backed convoys? Then you can think about the timetable here. If you think about, well, the Strait of Hormuz is going to be closed for five years. Let's just get used to being poor.

• 2:32:17John Coogan?

  Black bill.

• 2:32:19Alex Epstein?

  No, I mean, this is, but this is, people don't get oil. Like, oil is, there's a reason why I focus a lot of my life on oil. Like, there is nothing more, there's no material in the world of energy that is more valuable than oil. Because oil is just so unique in terms of it has this very high energy density and portability. And there, there's nothing like, I mean, nuclear has higher.

• 2:32:39John Coogan?

  What about plutonium?

• 2:32:40Alex Epstein?

  Yeah, yeah. It doesn't have the same portability.

• 2:32:43John Coogan?

  We're gonna be rich. We're gonna have energy too cheap to meter in five years. I talked to a lot of nuclear founders.

• 2:32:47Alex Epstein?

  Well, look, I love nuclear as much as anyone. They don't, they don't even have a portability solution, though, for the near future, unless you're talking about aircraft carrier or an icebreaker or something like that. So I'm just saying, the world runs on mobility. And oil is ideal for mobility.

• 2:33:01John Coogan?

  Oh, portability in the sense of like using nuclear to actually power trade and commerce and moving ships around?

• 2:33:06Alex Epstein?

  Yeah, yeah, I mean.

• 2:33:07John Coogan?

  Even if you can power the grid, you will be poor because you will not be able to trade.

• 2:33:12Alex Epstein?

  Yeah, trade is really important.

• 2:33:13John Coogan?

  Trade is really important.

• 2:33:14Alex Epstein?

  Trade is, trade, and well, and also it's within the country, too. We don't have the nuclear trucks to move things around.

• 2:33:19John Coogan?

  Sure, sure, sure.

• 2:33:20Alex Epstein?

  Yes, obviously, you want super cheap electricity and you want super cheap transport fuel. And for, and, and we want to see if we can electrify some of this stuff.

• 2:33:28John Coogan?

  Yeah.

• 2:33:29Alex Epstein?

  If you can do it cost effectively, it's just.

• 2:33:31John Coogan?

  There's some people working on like electric bulldozers, for example. It's very hard and I don't know the time.

• 2:33:36Alex Epstein?

  By the way, guess what? You need a lot of oil to even get that whole supply chain started because you need the mine.

• 2:33:40John Coogan?

  Yep.

• 2:33:40Alex Epstein?

  So, anyway, bottom line, yes, I, I meant that thing about we can all be poor, very seriously. Very seriously. So we have, if you look at the spare capacity, I think that's all of them. So we have the I, the rest of the IEA, we have ours. And then to my knowledge, we have Saudi slash UAE, them using spare capacity and them piping it where they can. So maybe combined, we're talking about six million a day. If you use all of those, I mean, somebody could imagine 10 million a day. And all of these have time, particularly the emergency reserve things, these all. Like the, at least the Saudi one is you're sort of, you have a deposit, a big deposit. Here, it's just you have a small reserve. So you can't do this forever.

• 2:34:19John Coogan?

  Sure.

• 2:34:20Alex Epstein?

  And of course, there's a risk of if you deplete the SPR more.

• 2:34:23John Coogan?

  Yeah.

• 2:34:23Alex Epstein?

  What if you really, really?

• 2:34:24John Coogan?

  Need it.

• 2:34:25Alex Epstein?

  Need it in the future. And then there's a bunch of nearer term stuff that you can do. And some of which I like just because it could be done anyway. So number one to piss a whole bunch of people off is let's stop using this Jones Act. Do you know what this Jones Act thing is?

• 2:34:38John Coogan?

  I've heard of it, but explain.

• 2:34:39Alex Epstein?

  So the Jones Act is a set of restrictions that say that you can only transport things among ports in the United States if you have, everything is basically American. So it's owned by an American, it's run, I don't know, all the, it is all this.

• 2:34:54Jordi Hays?

  Yeah, it's basically American ship, American crew.

• 2:34:56John Coogan?

  Yes.

• 2:34:56Alex Epstein?

  Yes. So it's, it's, it leads to all these crazy, crazy things. Like we end up importing things from, like instead of importing it from one part of the country to another, you end up importing it from some really far away place. It leads to that kind of thing. But in this case, in particular, this, this, as Californians, we should all recognize this. We don't have oil being piped into California.

• 2:35:18John Coogan?

  Yeah.

• 2:35:18Alex Epstein?

  So we want very efficient maritime transportation. And if you suspend the Jones Act, then you can get more efficient transportation, which means we can at least have lower prices here and we can have less of a price shock. But in general, I want people to get used to having no Jones Act because I want there to be no Jones Act.

• 2:35:35John Coogan?

  Sure, sure.

• 2:35:35Alex Epstein?

  So that's, that's a good thing to do. My favorite idea here is.

• 2:35:40Jordi Hays?

  And, and the, the, I imagine there's a bunch of powerful lobbies that will fight and kill for the Jones Act because there's.

• 2:35:48Alex Epstein?

  Correct.

• 2:35:48Jordi Hays?

  Entire industry built around.

• 2:35:50Alex Epstein?

  Yeah, there's the idea that we can only have a good shipbuilding industry. Like, I don't know what people think is happening with our shipping, like our shipbuilding industry is not going as well as other people's.

• 2:36:00Jordi Hays?

  It didn't exactly, it didn't exactly work.

• 2:36:02Alex Epstein?

  Yeah, I mean, it worked to protect certain people's.

• 2:36:04Jordi Hays?

  I'm just saying, if you look at American shipbuilding, it's, it certainly has.

• 2:36:08Alex Epstein?

  Yes.

• 2:36:08Jordi Hays?

  Allowed us to be competitive on, on a global stage.

• 2:36:11John Coogan?

  The shipbuilders would say we're early, but I take your point.

• 2:36:15Jordi Hays?

  Early, but you've seen, but I'm just saying like, you know, how many decades of declines?

• 2:36:20Alex Epstein?

  Yeah, okay, well.

• 2:36:20Jordi Hays?

  You need.

• 2:36:21Alex Epstein?

  I, I think.

• 2:36:22Jordi Hays?

  John's like, we're still early.

• 2:36:24John Coogan?

  It's like, it's like a smiling curve, like churn. It goes down and then goes back up.

• 2:36:28Alex Epstein?

  So.

• 2:36:29John Coogan?

  That's, that's the bulk case.

• 2:36:30Alex Epstein?

  That's, that's the, uh, all right. Well, it's, it's definitely not going to help us. So, so they kind of, here's the most interesting thing, which I, is a pet issue of mine is we're, we're like this administration, I should say, does a lot of good stuff on energy. I say that I, you know, I'm in a fortunate position where I get a lot of people ask for advice and stuff like that. I feel like one of my jobs is to tell people things they're not doing. A lot of things they'll just do right on their own. But, but Canada is not one of those things right now. We are just absolutely sleeping on Canada as an opportunity. So Canada has no people and infinite resources and is really friendly.

• 2:37:06John Coogan?

  Yeah.

• 2:37:06Alex Epstein?

  So you did, they have these oil sands. You know what these things are?

• 2:37:09John Coogan?

  No, explain.

• 2:37:09Alex Epstein?

  So, so they're just like these deposits of oil. It's like nature basically committed an oil spill. Is the way to think of it.

• 2:37:16John Coogan?

  Okay.

• 2:37:16Alex Epstein?

  So there's all these oil sands. For years, they were not very useful.

• 2:37:19John Coogan?

  They weren't viable because it's not just you drill down, black gold comes up. It's like buried in the sands need to be refined.

• 2:37:25Alex Epstein?

  There are different kinds of things. You can mine it out directly, or you can do what's called in situ, which is you heat it up underground.

• 2:37:31John Coogan?

  Oh, and it liquefies.

• 2:37:32Alex Epstein?

  In any case, we, they have just this unbelievable oil seep. They have way more oil deposits than we do, way more oil reserves. But they have on the order of a third of the production. And in part because they have absolutely terrible policies, which are their fault. But in part, we have had terrible policies, including getting rid of the Keystone XL pipeline and this kind of thing. So, but if you just think of Canada, it's just, we should be so, they have water. I mean, they get no people, one tenth the population, infinite raw materials. They got everything. They got timber, they got his natural gas, they got oil, like, and we're talking about Venezuela. They're a friendly country, right? They got smart people there. They're, they haven't been driven out of the country because they're afraid of getting killed by Chavez or Maduro or whatever.

• 2:38:16Alex Epstein?

  So this is an opportunity to say, hey, Canada, let's work, let's have a task force. You guys are at a low in terms of, we don't have pipelines. But we can do rail, at least we can do rail, maybe trucks, but at least rail. Rail transports from Canada are really low right now. So let's have an initiative where maybe you bring a couple hundred thousand, depending on your expectations. Maybe we can add a couple hundred thousand barrels a day. So that's one that excites me because I want to be like the US, Canada superpower thing is this huge opportunity that we're sleeping on because of the idea of, oh, we should only be doing it in quote, America. But this is just by the unbelievable, I think they have the best uranium in the world.

• 2:38:55John Coogan?

  Yeah.

• 2:38:56Alex Epstein?

  It's a.

• 2:38:57John Coogan?

  Maple syrup's up there.

• 2:38:58Alex Epstein?

  Yeah, I don't have a Canadian personality, but I love that place.

• 2:39:01John Coogan?

  No, strategically, it makes a ton of sense.

• 2:39:03Alex Epstein?

  And they're very friendly.

• 2:39:04John Coogan?

  Yes.

• 2:39:04Alex Epstein?

  They're very friendly.

• 2:39:05John Coogan?

  Maybe we should be friendlier.

• 2:39:06Alex Epstein?

  Yes, you know, no, we should, and we have trade agreements coming up.

• 2:39:09John Coogan?

  Yes, yes.

• 2:39:10Alex Epstein?

  The other thing is we have some, you know, we can increase capacity here, as I mentioned, depending on prices going up.

• 2:39:17John Coogan?

  Yeah.

• 2:39:17Alex Epstein?

  So there's that, but that might be a couple hundred thousand dollars barrels a day. But so high level, open the Strait of Hormuz, that's the only thing that really works. Then you can talk about Saudi, Mideast spare capacity, our emergency capacity and IEA emergency capacity, and then below that you have Canada Jones Act and US.

• 2:39:36John Coogan?

  That's great.

• 2:39:37Alex Epstein?

  Production.

• 2:39:38John Coogan?

  That's a really, really thorough list. Thank you. I appreciate that. Anything else, Jordy?

• 2:39:42Jordi Hays?

  What are you, what are you going to be paying attention to most closely?

• 2:39:46John Coogan?

  Do you watch the price chart? Is that important to you?

• 2:39:48Alex Epstein?

  Well, it's important. I mean, I'm, it's weird. I work with, I run like a kind of a network of energy executives, but I'm focused on the policy side of things. So I'm often laughably out of touch. I mean, I know in general, within $10 usually what it is.

• 2:40:05John Coogan?

  Yeah.

• 2:40:05Alex Epstein?

  But I, as a policy, I don't, I don't invest in energy.

• 2:40:08John Coogan?

  You're looking at longer term, five, 10 year plans.

• 2:40:11Alex Epstein?

  Like I'm deliberately avoiding exposure to the commercial part of it.

• 2:40:14John Coogan?

  Of course, of course. Yeah, you want to be independent.

• 2:40:16Alex Epstein?

  Yeah, I want to be independent. So, yeah, I'm not, but. At the moment, yes, I am looking, I am looking at the prices.

• 2:40:22John Coogan?

  Okay.

• 2:40:23Alex Epstein?

  But I don't do predictions, but I'm just saying, I think there's a service right now in just laying out the options for people, because even in the government, I mean, you know, not everyone has a lot of expertise in oil, and this is the kind of thing where, yeah, it's kind of why I think you texted me this morning, I mean, sometimes you need to know, sometimes you need to know about oil today, and sometimes you don't, but when you need to know, you need to, you really need to know.

• 2:40:45John Coogan?

  Yeah, well, it seems like whether you're in the business community, or just, you know, humanitarian, everyone should be rooting for a swift and peaceful resolution.

• 2:40:55Jordi Hays?

  Yeah, do you have any insight, this might be totally out of your wheelhouse, but insight into how, how people running businesses that are most impacted by fluctuations in oil prices, like, are they, were they, have they been actively hedging over the last couple of weeks, are they doing, like, how do you run your business when your input costs can go up dramatically, potentially at a much higher rate than you can adjust your own prices?

• 2:41:22Alex Epstein?

  I mean, just in general, these guys are sophisticated, I think, within the bounds of doing it, I don't think you can hedge indefinitely for this big a price, kind of differential, like somebody is gonna say, I mean, but it's also, you think about, there's on the consumer side, but on the production side is even more dramatic, if you just look at the margins of these guys, I mean, the oil industry is just, just fascinating, I just remember anecdotally, when I came out with my first major book, The Moral Case for Fossil Fuels, in 2014, even I could see speaking engagements correlated to these prices, because you had a big price crash around them, and then you think, wow, like...

• 2:42:01Jordi Hays?

  We don't need, we don't need Alex.

• 2:42:02Alex Epstein?

  Yeah, it might be nice to keep the troops motivated, but, you know, I'd probably rather be employed, but it's, it's a hard, it's a hard business, and one of these things is you just, the people who survive have a very strong... Constitution and and they they they can manage the risk very, very well. I was talking with a bunch of these these guys and actually people we know in common and like some of the better ones, some of the two of the young superstars in in the industry, they're just saying like, like, we love the chaos because we can just know we can handle it like when the prices go down.

• 2:42:40John Coogan?

  Sure.

• 2:42:40Alex Epstein?

  Because that that's you think about what they've been dealing with over the last year. They've increased production, prices have gone down and and you look at this this administration is very focused, I would say too much focused on having prices go low. This is this is one of the variables here is although the administration, I don't think was fully was not fully prepared for this situation. In general, they are maniacal about prices going low like Trump in his mind has a very strong focus on $50 a barrel, which I think he feels like that's always the perfect price for oil.

• 2:43:11John Coogan?

  Sure.

• 2:43:11Alex Epstein?

  And the people in the oil industry say, wait a second, like we had inflation of everything else. Why does our one product have to stay at $50? And that's part of the appeal of Venezuela, rightly or wrongly, because it's not going to make a big difference soon. But it's like, how do we keep oil prices?

• 2:43:24John Coogan?

  Low.

• 2:43:25Alex Epstein?

  Low. But that's that's hard to be in that industry as a consumer, as a producer, rather, and it's hard as a consumer. So they have financial instruments. But the main thing is you just you need to you need to just have the flexibility in your business in your business model. And it's it's oil is again, it's the most valuable material in the world of energy, which is why everyone uses it. But it's also why it's so inelastic and you have these price fluctuations. So you just need to come to terms with that or somebody needs to figure out something better. But it's it's really hard. And of course, policy wise, we can have better policy to make it more stable, but it's still that thing where it's so valuable that guess what? You get a little extra demand, a little less

• 2:44:09Alex Epstein?

  supply, price goes up a lot. It's it's different than other things which you can substitute for much more rapidly.

• 2:44:15John Coogan?

  You're out of a job when we build the Dyson sphere.

• 2:44:19Alex Epstein?

  Oh, man, I got, I'm, I'm working on this AI thought leader thing we talked about last time. So I got, I got plenty to do.

• 2:44:25John Coogan?

  We'll cross that bridge when we come through.

• 2:44:26Alex Epstein?

  I got plenty to do with my time.

• 2:44:28John Coogan?

  Thank you.

• 2:44:28Jordi Hays?

  As long as we need energy, you'll, you'll be doing just fine.

• 2:44:31Alex Epstein?

  I guess.

• 2:44:32John Coogan?

  Thank you so much for coming on the show. 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 let me also tell you about AppLovin', profitable advertising made easy with axon.ai. Get access to over 1 billion daily active users and grow your business today. And without further ado, we have our next in-person guest live in the UltraDome, Michelle Vols. How are you doing?

• 2:44:57Speaker 12

  Good.

• 2:44:58John Coogan?

  Good to see you.

• 2:44:58Speaker 12

  Good to see you guys.

• 2:44:59John Coogan?

  Thank you so much for coming down to the TVP UltraDome.

• 2:45:00Speaker 12

  Yeah, no, happy to be here.

• 2:45:01John Coogan?

  For those who aren't familiar with your venture capital career and your marathon running career, introduce yourself.

• 2:45:08Speaker 12

  Yeah, so I am Michelle. I was previously at Andreessen Horowitz. I just launched my own fund, PAX, which is a $50 million early-stage venture fund focused on foundational categories. So I was on the American Dynamism team at Andreessen Horowitz, similar themes to that, just earlier stage.

• 2:45:26John Coogan?

  Biggest lessons from Andreessen Horowitz?

• 2:45:28Jordi Hays?

  Can we hit the gong first?

• 2:45:29John Coogan?

  Oh, yes, we gotta hit the gong.

• 2:45:30Jordi Hays?

  I think, I think Michelle should hit it herself.

• 2:45:33John Coogan?

  Here we go, hit the gong.

• 2:45:34Jordi Hays?

  We're here in person. Go for it.

• 2:45:36John Coogan?

  The gong, it's already sort of broke.

• 2:45:37Jordi Hays?

  You won't break it.

• 2:45:38John Coogan?

  Smash that.

• 2:45:39Jordi Hays?

  He's, he's in kind of tennis form.

• 2:45:45John Coogan?

  That was good, that was good. Anyway, let's, let's start with like lessons from Andreessen Horowitz. Like what did you learn? What are your biggest takeaways? What are, what's the playbook that you think you will be continuing? And then we can go into what you think might be different.

• 2:45:59Speaker 12

  Yeah, I mean, I think in the categories that I look at, it is common for founders to need to raise a lot of capital.

• 2:46:07John Coogan?

  Okay.

• 2:46:07Speaker 12

  And the ability to be able to fundraise for that capital ahead of maybe what are traditional milestones in software investing is very important.

• 2:46:17John Coogan?

  Totally.

• 2:46:17Speaker 12

  You need to be able to be a magnet for capital, for talent, and sell a vision, because what you're doing is like very hard with, with fewer obvious proof points, maybe, at the early days.

• 2:46:27John Coogan?

  Yeah.

• 2:46:28Speaker 12

  And I think Identifying that in founders early is something that Enrez and Horowitz is very good at.

• 2:46:33John Coogan?

  Yeah, in American dynamism companies, hard tech companies, it does feel like there's like high CapEx requirements, high human capital requirements, you're not going to automate everyone on your supply chain on day one. And so there is this, like, how you talk about growth, how you talk about scaling and success and finding product market fit, it's, it almost feels back to like the, okay, we're scaling DAU and we're, let's focus on that metric instead of like profit in software. What does it look like in hard tech? Is that the, okay, we have a program of record, or we have these SBRs coming in, or we have

• 2:47:15John Coogan?

  this long contract that is very solid, but we're not going to draw down on it for a few years, so we have a capital need. But how do you think founders in hard tech should be talking about what progress looks like at top line, or whatever top line means?

• 2:47:30Speaker 12

  Yeah, I mean, I think that's the hardest part. Like, in software, there's such a structured set of metrics that everybody has been trained around, like growth rate, like weekly active users, revenue. It is so different, company by company, in these sectors, and that's why the storytelling is important, because if you're talking to later-stage investors, they might be trying to make a pattern recognition off of a pattern that doesn't quite exist yet. And so in defense companies, like, yes, there are government contracts you should be trying to get, you should be working towards programs of record, but there are like different intermediate proof points before that. I usually explain it to founders as like, the three things you're trying to make progress on are people, product, and then like revenue or traction.

• 2:48:14Speaker 12

  And so it's like, are you hiring the best people and the people that are experts in the different categories that you need? So maybe you need a mechanical engineering hire, maybe you need a government sales hire, maybe you need software as well. Are you making progress on people? Are you making progress on product that's tangible? Like, can you show that there's like developments? Maybe that's like you've built something and it's like test, like gotten to a test milestone. Maybe it's in the hands of users. Like, are you making product progress? And then are you getting some sort of signs from customers that like they are willing to pay for this? Like, are you getting contracts? Are you getting LOIs? Like, are you getting something that shows that there's a commercial use case for this? I think sometimes in like hard tech, there's a million names, hard tech, deep tech, frontier tech, American dynamism.

• 2:48:56Speaker 12

  I think sometimes people skew more towards thinking it's just deep tech, which is like, I would describe. Exactly, like science risk. Like, nuclear fusion is probably like the most extreme example.

• 2:49:08John Coogan?

  Yeah.

• 2:49:08Speaker 12

  That's hard. Like, it's like, of course, there's a customer if you can do this. But like, we'll see what the timeline is, hopefully soon. But I think in a lot of the categories I look at, there are commercial proof points you can make. Like, there's usually a latent demand or like, or an immediate demand. It's like, how do you show that you can get those customers and they can like, signal that they will buy from you?

• 2:49:28John Coogan?

  Yeah. There was this viral Citrini article that said, "Software is dead, sell everything." How are LPs thinking about hard tech as a category with that backdrop of like the SaaSpocalypse? I imagine it makes things easier for you, but has it actually rippled through the LP community to the degree that your investors are more excited than ever to have a hedge against chaos in automatable software, all of that?

• 2:50:00Speaker 12

  Yes. I, I will say this with love to all of my LPs. I think founders are typically like leading indicators in categories. Like, they, they are at the cutting edge, like they are seeing around corners. Often, like, great founders will see something before VCs do. Like, VCs are lagging indicators. Like, once something is hypey, it's like usually too late to find a good early-stage investment. LPs are lagging, lagging indicators.

• 2:50:23John Coogan?

  Sure.

• 2:50:24Speaker 12

  That once something is very mainstream and there starts to be some signs of returns, then they're like, we should pay attention to this category.

• 2:50:32John Coogan?

  Got it.

• 2:50:32Speaker 12

  And so I would say, a thing that was more surprising, partly because I live in my own echo chamber and constantly hear about like all of these great companies building in like defense tech, hard tech, and like industrial tech. LPs weren't as familiar as I expected. So like there was a level of education. I think there's still some weariness of like there haven't been a ton of exits yet.

• 2:50:54John Coogan?

  Yeah.

• 2:50:54Speaker 12

  I mean, I think that might change if SpaceX IPOs.

• 2:50:57John Coogan?

  Yep.

• 2:50:58Speaker 12

  Be one of the biggest IPOs ever in history.

• 2:51:01John Coogan?

  Yeah.

• 2:51:01Speaker 12

  But I would say like the, the appetite for it grew over time as I was fundraising.

• 2:51:07John Coogan?

  On SpaceX, uh, yeah, I mean, great point. It's, it could be like 1.75 trillion is the number that's being floated. It's staggering amount. It's going to return like not just like one venture capital fund. It's going to return like 20 venture capital funds. Like everyone who invested at early stage is going to see their fund return from that. But all the LPs had to go on a 20 year journey with like a million continuation vehicles. How are you thinking about timeline messaging to LPs? Because 10 to 12 years is what I've heard recently is kind of standard. But I've talked to some VCs and say, yeah, like most of my LPs want their money back in like six to seven years. And yet in hard tech, it feels like it might be longer.

• 2:51:48John Coogan?

  Are you communicating a particular timeline or is that even a relevant conversation?

• 2:51:53Speaker 12

  Yeah, I think like every, every fund roughly pitches 10 to 12 years.

• 2:51:57John Coogan?

  Sure.

• 2:51:58Speaker 12

  Sort of the expectation.

• 2:51:59John Coogan?

  Yeah.

• 2:52:00Speaker 12

  I think it's actually an interesting catch 22 because if you had ownership in SpaceX, your LPs actually like, we're like, hold on to that.

• 2:52:08John Coogan?

  Yeah, totally.

• 2:52:08Speaker 12

  Like, keep that. I think it's going to keep going up. But maybe you would have an option to take some off the table.

• 2:52:14John Coogan?

  Sure.

• 2:52:14Speaker 12

  And return some, you know, money to LPs if that's what they wanted. But often if it's like a really, really good deal, LPs are like, oh, I think it's going to keep going up. But I, I think it's like case by case.

• 2:52:25John Coogan?

  Yeah.

• 2:52:25Speaker 12

  I actually just was talking to LPs about this and they were like, sometimes it makes sense and sometimes like hold on. And I think if you build a lot of trust with your LPs, like they're usually along the ride with you.

• 2:52:35Jordi Hays?

  What, what GOs are you spending the most time right now? Obviously, the, uh, it feels like we have so many, so many founders that are just like in, in our kind of neck of the woods here, but are you spending a bunch of time in Texas, Bay Area? Where, where do you expect to deploy most of your dollars?

• 2:52:52Speaker 12

  Yeah, I think like there's five GOs. It's San Francisco, LA, uh, Austin, New York, and DC. I'm actually seeing like a significant amount of companies in DC.

• 2:53:02John Coogan?

  In DC.

• 2:53:02Speaker 12

  Austin, I would say though, is the biggest surprise for me. I know people have been trying to make Austin happen for a while, and I, I was skeptical, and now I think, like, it's sort of been an explosion of great companies.

• 2:53:13John Coogan?

  It was kind of the same thing with LA. Like, there was this long LA movement a while ago. Snapchat was sort of like the first big, like, you know, public tech company, or one of them to come out of LA. And then the El Segundo thing just happened like completely organically, without any of those people that were cheering for LA, and it just sort of popped up, and it seems like, uh, Austin's going through a similar thing. Uh, what's unique about the companies that are building in DC? Are they thinking more demand generation first, more, more work on Capitol Hill first, and then maybe they'll set up a satellite manufacturing office, or work with like a contract manufacturer to deliver their capability?

• 2:53:48Speaker 12

  Yeah, I think, like, you're seeing founders who are working at companies, like, like Palantir, for example, that have a big office in DC.

• 2:53:56John Coogan?

  Oh, sure.

• 2:53:56Speaker 12

  They've been relocated to DC. They're close to their customers, and then they spin out, start a company. Um, usually, these companies will end up opening an office in New York as well. Um, it's just a deeper pool for engineers. But there's a surprising amount of really strong engineering talent in DC that is like pretty fixed. Like, they want to stay in DC, they have a life, they have a house, they have a family. Um, so it, it can be a very good place to start a company.

• 2:54:21John Coogan?

  What's the view on shipbuilding? Jordy says it's impossible to build a ship in this country. He was saying it can't be done. Is it possible?

• 2:54:28Speaker 12

  We, we need to figure it out. The parts are gonna be behind. I think, I mean, like, the optimistic take would be, like, we can make it possible.

• 2:54:36John Coogan?

  Sure.

• 2:54:37Speaker 12

  Um, we should make it possible. The pessimistic take is if we don't make any changes into the regulatory environment, or the cost of building these things, um, it might not be, and that would be a shame.

• 2:54:47John Coogan?

  Yeah, that makes sense.

• 2:54:49Jordi Hays?

  Strategy with the fund.

• 2:54:51John Coogan?

  Yeah.

• 2:54:51Jordi Hays?

  These like two million dollar lead, three seed type checks. What's the deal?

• 2:54:57Speaker 12

  Yeah, on average, one to two million dollar checks, like early stage, try to be in like the pre-seed, seed, occasionally a little bit later rounds. Like to partner really closely with founders. And I think the special thing about the early stage, which is just my favorite stage of company, is you get to be very aligned. It's like a significant check for me if I put, you know, one to two million dollars into your company and I'm very motivated to help you be successful to get to the next round. And then for that next round, I can be much more strategic in helping you get there because I can't lead your next round. Whereas I think sometimes at the multi-stage funds, it can be a little bit tricky to give advice for future fundraises because you might be able to participate.

• 2:55:41Speaker 12

  And so you have to be like more delicate about it at a big fund and as a small fund, you just get to like be totally aligned with the founder.

• 2:55:49John Coogan?

  One last question about sort of the category targeting. American Dynamism made a lot of sense as like a theme around defense tech and hard tech. And you put a manufacturing company in there. One of the interesting subcategories of AD that I always, that always popped out to me was something around education, like reeducating workforce, education, also just like education technology broadly. Do you think that that's within your purview or is that something that you're sort of carving out and focusing more on the deep tech, hard tech, physical products?

• 2:56:23Speaker 12

  Yeah, I would say I like to look at things that sit at the infrastructure layer of society, which could include education and housing, sometimes even healthcare. Often things at the intersection of hardware and software or tech and government, or just like doing something fundamentally important for like the broad majority of Americans. I think American Dynamism is this beautiful phrase that can be an umbrella phrase as well. I sort of embrace that as well with PACS. But at the early stage, like what you're really betting on is people. Like there is so little to understand except like the team in a dream. Like are you building something in a category that's very exciting or you're taking the big swing? Do you sort of have a right to win in that category and some sort of unfair advantage?

• 2:57:05Speaker 12

  I like founders that have like worked in the industries that they are building in before. And do I believe you can be that magnet for capital and talent and everything?

• 2:57:15John Coogan?

  Yeah, where are the big talent pools these days? There's the SpaceX mafia, the Palantir mafia. It feels like there's an Anduril mafia now. Where else?

• 2:57:22Jordi Hays?

  Tesla mafia. Base Power mafia.

• 2:57:24John Coogan?

  Base Power maybe in Austin.

• 2:57:26Jordi Hays?

  In Austin eventually.

• 2:57:27Speaker 12

  Yeah, I think Base, I think Serronic is starting to see a few things. Basically, any company that's that's like reaching escape velocity or like escape velocity and product market fit has grown really quickly, has hired exceptional people. There are some people that really love that zero to one stage and the company gets big. Like I think we're seeing it at Anduril. We saw it at Palantir. We continue to see it at Palantir. People people learn how to grow quickly and then want to apply that to their own company.

• 2:57:55John Coogan?

  Amazing. Well, thank you so much for coming by.

• 2:57:57Jordi Hays?

  Congratulations.

• 2:57:58Speaker 12

  Thank you.

• 2:57:58Jordi Hays?

  Have a great rest of your day. We'll have a lot of your companies on.

• 2:58:01John Coogan?

  Let me tell you about Vanta, automated compliance and security. Vanta is the leading AI trust management platform. And let's go over to some hard tech that's happening with Stargate.

• 2:58:15Jordi Hays?

  By the way, John, apparently Trump said something to the effect of, I think the Iran war is very complete, pretty much.

• 2:58:24John Coogan?

  Oh, okay.

• 2:58:25Jordi Hays?

  So we may be on the verge of new era of peace.

• 2:58:30Speaker 06

  Crude is back down to like pre like Friday, pre weekend prices.

• 2:58:34John Coogan?

  Eighty, ninety?

• 2:58:35Jordi Hays?

  Eighty-three.

• 2:58:36John Coogan?

  Okay, eighty-three. Okay, well, maybe he was watching. Maybe he was watching Alex Epstein. And Alex said, hey, we gotta, we gotta wrap this up. We gotta stop.

• 2:58:47John Coogan?

  The price is too, too darn high, says Alex Epstein. Oracle and OpenAI allegedly dropped their Stargate expansion lease. Meta swooped in the same day. Ben Puledean says, that's not weakness, that's a hot real estate market. And then he goes on to comment that the real story is OpenAI passed on six additional buildings because power won't be ready for a year. The power is, is, is the gating factor here, not the chips, interestingly. We are in the power bottleneck, the energy bottleneck. And by then, Ruben replaces Blackwell. So why are you gonna build a Blackwell data center when you could build a Ruben data center? So why expand with last gen chips?

• 2:59:29John Coogan?

  The eight building, 400,000 GPU base build continues. This is smart capital allocation, he says. And so this is based on reporting from the information about Oracle and OpenAI sort of adjusting the plan for Stargate. I am particularly interested in digging into the Stargate of China. They have a project that's the Chinese Stargate, funded to the tune of 36 billion, not up at half a trillion, but still.

• 3:00:03Jordi Hays?

  Very big number.

• 3:00:04John Coogan?

  It's a big number and it's growing. And I've been digging into it a little bit, trying to learn as much as I can. We'll do a deep dive, probably with someone at Samae Analysis who knows a lot more.

• 3:00:13Jordi Hays?

  And ChatGPT is back at the top.

• 3:00:17John Coogan?

  No way.

• 3:00:17Jordi Hays?

  The App Store leaderboard.

• 3:00:19John Coogan?

  You know, we do have to.

• 3:00:20Jordi Hays?

  Adam GPT says GPT 5.4.

• 3:00:23John Coogan?

  Sudden, it's for gods. You know what that meme is from? Big Chungus? It's a good one. Anyway.

• 3:00:30Jordi Hays?

  Yeah, so I'm kind of surprised by this for the one reason being I expected Anthropic's been spending a ton of money on marketing. They started ramping it up.

• 3:00:40John Coogan?

  Yeah, I see that.

• 3:00:41Jordi Hays?

  Around the time of the Super Bowl. I expected them to basically be willing to spend whatever it took to stay on top.

• 3:00:48John Coogan?

  Yeah, but I mean, it's capital war. So both sides are gonna spend a lot of money.

• 3:00:51Jordi Hays?

  Yeah.

• 3:00:52John Coogan?

  And, you know, there was, what?

• 3:00:55Jordi Hays?

  Wasn't the rise in the Claude ranking just because of the DOW news? And now that's like not on the front page?

• 3:01:01John Coogan?

  So, yeah, I was getting it. It was like when the Super Bowl ad dropped and we had some harsh words for the nature of the characterization around ads, our favorite thing in Claude. led us to launching Claude with ads. But our question was, will this Super Bowl ad move the needle for the consumer app? Like, a Super Bowl ad is a massive campaign. Millions, tens of millions of people will see this. It went viral. Like, it's, will it work on people? Will people see this ad that's like, sort of deep in the weeds around how ads work in L L Ms? Like, will this be enough for people to go and hit the download button? There's a hurdle there, will they do it? And they did it a little bit. It wa- I think Claude went from like, like, twenty-sixth to eighteenth, or it started climbing then.

• 3:01:46John Coogan?

  And then, you're right, the Department of War narrative really, really shot up. But as with any, any story in tech, it has to go back and forth and back and forth. And the memo that came out on last Wednesday probably sort of reset the narrative there and changed how people were thinking about that. And also, these charts are based on momentum, and so it's very, very hard to say.

• 3:02:11Jordi Hays?

  Yeah, Claude had gotten to something like a million downloads a day, according to Mike Krieger.

• 3:02:16John Coogan?

  Oh, yeah.

• 3:02:16Jordi Hays?

  And at the same time, ChatGPT last month, I think, did like fifty-five million downloads. So it's still not outpacing ChatGPT's last month.

• 3:02:24John Coogan?

  Paramount Plus is number four in the free apps. Although, how can it be free when you have to subscribe? It's sort of odd.

• 3:02:31Jordi Hays?

  Yeah, that's the whole thing.

• 3:02:32John Coogan?

  But bullish for the Ellison team.

• 3:02:35Jordi Hays?

  Krish says U M F's ruined agency so bad that I'm gonna have to start using, saying gumption.

• 3:02:40John Coogan?

  Gumption. Gumption is really good. I like gumption.

• 3:02:46Jordi Hays?

  We hire for gumption.

• 3:02:48John Coogan?

  A I gumption. A I agents.

• 3:02:50Jordi Hays?

  We only hire for gumption here.

• 3:02:52John Coogan?

  What's the noun version of gumption? I don't know.

• 3:02:54Jordi Hays?

  A friend of the show, Amjad, said not having coding experience is becoming an advantage. And Shurya says not knowing how to cook is becoming an advantage. C E O of McDonald's.

• 3:03:06John Coogan?

  I love it. Almjad has some great takes, though. This is just easy riff. It's all in good fun. What else is going on? Lots of debate over the singularity pricing, as Will Depew put it. Because Barely AI, which I believe is Trung Phan, says cursors' internal analysis shows how hard Anthropic is subsidizing Claude code. Last year, a $200 monthly subscription could use $2,000 in compute. Now, the same $200 a monthly plan can consume $5,000 in compute. It does feel like there's a capital war. I'm very interested to dig into the history of capital wars in winner-take-all markets,

• 3:03:51John Coogan?

  but also in oligopoly markets.

• 3:03:54Jordi Hays?

  You should write a book on capital wars.

• 3:03:57John Coogan?

  Capital wars are fascinating. I lived through it during the Uber and Lyft era. There was a flippanting for a little bit where Lyft was at the top of the charts.

• 3:04:06Jordi Hays?

  The friendly, the friendly rideshare company.

• 3:04:09John Coogan?

  It was very friendly. The cars would pull up with a pink mustache on them. It had a very, very fun, whimsical branding. And you would sit in the front seat of the car because you were friends with the driver.

• 3:04:19Jordi Hays?

  I could see Claude with a pink mustache.

• 3:04:21John Coogan?

  This is a real thing.

• 3:04:22Jordi Hays?

  That's what I'm supposed to do.

• 3:04:23John Coogan?

  So when Lyft launched, people see Lyft and Uber as commodities at the time. But Lyft was revolutionary, and people were super blackbilled on Uber. Because Uber, at the time, was only black cars. So they didn't allow anyone to just hop on the network. Like, it was not a three-sided marketplace or whatever, a two-sided marketplace. Like, you had to have a livery TCV number. I forget what it's called. But you had to be registered as a limo driver. And you had an Escalade. And normally, someone would call you and say, hey, there's a wedding, and we want you to come shuttle people around at this wedding. And they would pay you for that. And Uber went to those folks, and they said, hey, you are registered to legally drive

• 3:05:07John Coogan?

  this car as a professional driver. We want to book you through our app. And so the black car became Uber's main product, their only product. And then Lyft figured out, through some interesting strategy, how to allow people to just show up with a Prius, or a Toyota Camry, or a Corolla, or whatever. And so drivers on launch day, I remember the launch week in San Francisco. Would just show up in just some random car, but Lyft gave them all pink mustaches, huge pink mustaches. The team can pull up a picture of the huge pink mustaches on the front of the Lyft cars that were very whimsical and, and it was remarkably cheap because Uber

• 3:05:51John Coogan?

  had been somewhat subsidizing the black cars. They hadn't been taking a huge margin. They were losing money, but the Lyft cars were way cheaper because someone was just showing up with like their Toyota Corolla or whatever with their pink mustache on it. And so, so you would hop in the front seat because thi- this driver was your friend.

• 3:06:08Jordi Hays?

  There you go.

• 3:06:09John Coogan?

  There you go. The pink mustache on top of the, what is that, a CRV or something? And so, and so you would hop in the front seat. You, th- they would ask you to pound the driver. Give him, give him the knuckles.

• 3:06:20Jordi Hays?

  Give him knucks?

• 3:06:21John Coogan?

  Give him knucks. This is the thing. I'm, I'm almost sure. So you'd be like, what's up? And then you would get in the front seat and they would drive you. Of course, if you had a group, you'd be in the backseat, but then-

• 3:06:29Jordi Hays?

  Everyone had to give knucks or just-

• 3:06:30John Coogan?

  I, I think the knucks might've been optional, but ra- encouraged, recommended because it was like, hey, we're buddies and we're, and we're fighting the war on the bork. We're going up against Uber.

• 3:06:38Jordi Hays?

  But you were encouraged to get in the front seat?

• 3:06:40John Coogan?

  Front seat, front seat in the, in the Lyft. In the Lyft, when you're taking a Lyft, your friendly Lyft driver shows up, you sit in the front seat, you give him knucks. This is the thing. Pink mustache. Chungus.

• 3:06:50Jordi Hays?

  That's crazy.

• 3:06:51John Coogan?

  Big Chungus sends his regards.

• 3:06:52Jordi Hays?

  Alright, alright. You gotta, you gotta hire a car, but you have to be absolute boys for the driver.

• 3:06:56John Coogan?

  You do. But, but truth be told, like a lot of the early Lyft drivers were like super cool tech forward San Francisco people. And so like you'd have a lot to talk about because like the people were like, they, they, it wasn't professionalized at all yet. It was very much like, like two-sided marketplace. You'd make a lot of money as a driver. Like there was no margin compression yet. It was like free money everywhere for everyone. And it was a capital war and Lyft raised a ton of money and gave, and came into the market with a disruptively cheap product and, uh, and wound up delivering a really fun experience that was very, very cheap. And then Uber sort of fast followed and launched, uh, Uber, what's it called? The normal one, not black.

• 3:07:38John Coogan?

  Uber X, Uber X, yes, Uber X. And Uber X was bring your own car. And then, and then the rest of the game played out. And it became a capital fight. And for a while, like, the meta was, oh, you're, you're, you're, you need a lift, you need a, you need a ride, you open Lyft and you check the price, and then you open Uber and you check the price. And people would check both prices constantly. And then, and then over time, like, the liquidity and, and power law stuff came into it.

• 3:08:01Jordi Hays?

  John, do you remember Uber helicopter?

• 3:08:03John Coogan?

  Yes, that was a partnership with Blade. I think that was a partnership with Blade, which was the Uber for helicopters. And it was a thing, but in, in like, you know, for a few weeks or something.

• 3:08:13Jordi Hays?

  Did you ever do it?

• 3:08:14John Coogan?

  No.

• 3:08:15Jordi Hays?

  No.

• 3:08:15John Coogan?

  Because Uber, Uber's had a whole bunch of different, like, stunty products, like, Uber, you know, Uber yachts, or Uber, they did Uber ice cream, where you could get ice cream delivered. That was like, the precursor to Uber Eats. They did an ice cream delivery truck, where they all, they, they, every Uber driver checked in with the, the field office, got a cooler in the back with a bunch of dry ice and a bunch of ice cream, and you could press a button in for like, $2, they would bring you an ice cream. They even did, I think, Uber kittens, and you could ask Uber to bring

• 3:08:47Jordi Hays?

  Yeah, Uber dogs or something?

• 3:08:49John Coogan?

  Cats or dogs or something?

• 3:08:50Jordi Hays?

  Yeah, I remember that.

• 3:08:51John Coogan?

  Yeah, it was very funny. Anyway, lots of stunts, lots of ways to get attention, go viral, and that was sort of the, the launch strategy. They would do that for, whenever they'd launch new markets. They would come in and they'd be like, we need to go viral on the local news, we need to let the town know that we've arrived, and so. Lots of, lots of back and forth in the capital wars of 2023, 2024. It was fun times. I lived, I fought through them. What else is going on?

• 3:09:16Jordi Hays?

  I think that's a good place to call it.

• 3:09:18John Coogan?

  Well, thank you so much for listening. We will see you tomorrow at 11 a.m. sharp. Leave us five stars on Apple Podcasts and Spotify. Sign up for our newsletter, tbpn.com, and have a great rest of your day.

• 3:09:30Jordi Hays?

  It has been an honor and a privilege.

• 3:09:32John Coogan?

  It has.

• 3:09:32Jordi Hays?

  And I hope by the time the show goes live tomorrow, the war is over.

• 3:09:36John Coogan?

  Me too, me too.

• 3:09:37Jordi Hays?

  That would be

• 3:09:38John Coogan?

  I would love that.

• 3:09:38Jordi Hays?

  That'd be quite nice.

• 3:09:40John Coogan?

  Thank you.

• 3:09:40Jordi Hays?

  Thank you.

• 3:09:41John Coogan?

  Goodbye.

• 3:09:41Jordi Hays?

  Cheers.