Anthropic vs DoW, Ben Thompson Joins, Ellison Says The Biggest Number | James Beshara, John B. Quinn, Michael Grinich, Adam Simon, Matthias Wagner, Joan Rodriguez, Zach Yadegari, Andy Markoff

Sign up for TBPN’s daily newsletter at TBPN.com (01:07) - Anthropic vs DoW (39:55) - Paramount Wins Warner Bros. (44:02) - 𝕏 Timeline Reactions (57:35) - Ben Thompson, founder of Stratechery, discusses the implications of AI's growing power, emphasizing the necessity for companies to consider governmental and geopolitical factors, particularly concerning national security and international relations. He highlights the potential for AI to disrupt existing legal and societal frameworks, stressing the importance of proactive engagement with policymakers to navigate these challenges. Thompson also reflects on the complexities of balancing technological advancement with ethical considerations and the need for new laws to address emerging issues like digital surveillance. (01:32:01) - James Beshara, founder of Magic Mind and former CEO of Tilt, discusses his journey from software to consumer packaged goods, emphasizing the iterative development of Magic Mind to enhance product quality before retail launch. He highlights the importance of hiring experienced team members, minimizing meetings, and adopting asynchronous communication to boost efficiency. Beshara also shares his approach to technology use, favoring devices like the Apple Watch to reduce distractions and maintain focus. (01:59:47) - John B. Quinn, the founding partner of Quinn Emanuel Urquhart & Sullivan LLP, is renowned as one of the world's leading trial lawyers, having built the largest law firm dedicated solely to business litigation and arbitration. In the conversation, he discusses the recent Supreme Court ruling that President Trump lacked the legal authority to impose certain tariffs, the subsequent invocation of Section 122 allowing temporary tariffs, and the potential legal challenges companies may face in seeking refunds for tariffs paid. (02:29:36) - Michael Grinich, founder and CEO of WorkOS, discusses the company's role in enabling software developers to integrate enterprise features like single sign-on and directory sync into their applications, facilitating enterprise readiness. He announces a $100 million Series C funding round, highlighting WorkOS's support for rapidly growing AI companies such as OpenAI and Anthropic in meeting enterprise security requirements. Grinich also introduces an AI-powered installer that significantly reduces integration time, allowing developers to implement WorkOS's solutions in minutes. (02:41:09) - Adam Simon is a creative technologist and former Global Head of Innovation at UM US, with over a decade of experience in innovation strategy. He discusses the future of entertainment moving beyond screens into immersive, real-world experiences, emphasizing the role of AI in personalizing physical environments. Simon also highlights the potential of venues like the Sphere and COSM to enhance live events through technology, and advocates for using existing devices, such as smartphones and AirPods, to deliver customized audio feeds at events. (02:54:23) - Matthias Wagner, founder and CEO of Flux, discusses the company's recent $30 million Series B funding led by abc, which will accelerate their development of an AI-powered hardware engineer designed to simplify electronics design. He highlights how Flux's browser-based platform enables users to create custom PCB boards more efficiently, reducing reliance on multiple off-the-shelf components and lowering costs. Wagner also emphasizes the platform's accessibility, allowing professionals from various engineering disciplines to design custom boards without prior PCB experience. (03:02:04) - Joan Rodriguez, CEO and founder of Quiver AI, discusses his company's development of AI models for generating and editing scalable vector graphics (SVGs) through code generation, enabling designers to create and modify vector images efficiently. He explains that their approach treats visuals as editable programs rather than static pixels, allowing for greater control and integration into design workflows. Rodriguez also mentions that Quiver AI recently raised $8.3 million in seed funding led by Andreessen Horowitz to advance their technology. (03:06:57) - Zach Yadegari, an 18-year-old entrepreneur and CEO of Cal AI, discusses the recent acquisition of his AI-powered calorie-tracking app by MyFitnessPal. He shares that after a year and a half of development, Cal AI, which generated $30 million in revenue in 2025, was acquired in December when he was 18, just before he turned 19 in January. Yadegari highlights the app's growth, noting that in January alone, it achieved $5.7 million in revenue, primarily through iOS subscriptions, and emphasizes the synergy between Cal AI and MyFitnessPal in their shared mission to promote healthier lifestyles. (03:12:47) - Andy Markoff, co-founder and CEO of Smack Technologies, is a former U. S. Marine Corps officer with over a decade of service, including roles as a Marine Infantry Officer, Joint Fires Instructor at MAWTS-1, and Marine Special Operations Officer during the Battle of Mosul. In the conversation, he discusses Smack Technologies' mission to deliver "Decision Dominance" to the Department of War and its allies by developing AI-driven decision-making tools for modern warfare, emphasizing the integration of deep reinforcement learning models to process vast sensor data and enhance military operations. 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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 TVP. Today is Monday, March 2nd, 2026. We are live from the TVP Ultra Dome, the Temple of Technology, the Fortress of Finance, the Capital of Capital. Let me tell you about ramp.com. Time is money. Save both. Easy use corporate cards, bill payments, accounting, and a whole lot more, all in one place. It was a massive weekend, so much news. We are very fortunate to be joined by Ben Thompson at noon. Let's pull up the linear lineup and show you the run of show today. Linear, of course, is the system for modern software development. Seventy percent of enterprise workspaces are using agents. We got Ben Thompson, James Beshara, John Quinn's coming back in person again. We're very excited to be joined by him.

• 0:37Jordi Hays?

  We'll be talking about tariffs.

• 0:38John Coogan?

  A monster lightning round with five different guests joining. We got some acquisition news. We got some funding news. We got some takes on tech and AI and media. We're going all over the place. It's gonna be a fun, fun show. But we missed you. We missed you on Friday. We were traveling. We went to Montana.

• 0:55Jordi Hays?

  Terrible day to be out.

• 0:56John Coogan?

  Terrible day to be out because it was

• 0:57Jordi Hays?

  Every single time we've had an off day, it ended up being a massive news day. So lesson, never take a day off.

• 1:04John Coogan?

  Yes. Never take a day off, truly. What an absolutely crazy weekend. Of course, there's the war with Iran. The big news in tech was the US halts the use of Anthropic AI after tension over guardrails. So this is in the Wall Street Journal, "The federal government will stop working with artificial intelligence company Anthropic," President Trump said, marking a dramatic escalation of the government's clash with the company over how its technology can be used by the Pentagon. Quote, "I am directing every federal agency in the United States government to immediately cease all use of Anthropic's technology. We don't need it. We don't want it, and we do not do business with them again."

• 1:48John Coogan?

  We will not do business with them again, Trump said Friday in a social media post. "The Defense Department and other agencies using Anthropic's Claude models will have a six-month phase-out period," the president said, adding that there would be civil and criminal consequences if the company isn't helpful during the transition. Six months to switch from one LLM to another feels like a long time, but I guess a lot of this has to do with like Fed ramp and actually getting new models.

• 2:12Jordi Hays?

  But this is a lot more than, you know, switching to a new model to run deep research reports, or involving classified systems.

• 2:19John Coogan?

  Sure.

• 2:20Jordi Hays?

  The context that people didn't have last week was that the United States Was headed to war.

• 2:28John Coogan?

  Yeah.

• 2:28Jordi Hays?

  Right. And so even having that context, I feel like is is pretty important. Right. It sort of explains the 5pm deadline.

• 2:37John Coogan?

  Urgency.

• 2:37Jordi Hays?

  Anthropic had taken issue with how their products were used in the Maduro raid.

• 2:41John Coogan?

  Yep.

• 2:42Jordi Hays?

  There's a new conflict that's unfolding.

• 2:46John Coogan?

  Yep.

• 2:46Jordi Hays?

  And so that makes the the aggressive timeline make a lot more sense. It also makes the six month.

• 2:53John Coogan?

  Phase out make more.

• 2:54Jordi Hays?

  Phase out make more sense because national security is on the line.

• 2:58John Coogan?

  Yeah.

• 2:58Jordi Hays?

  This morning, Scott Beson said at the direction of the president, the US Treasury is terminating all use of anthropic products, including the use of Claude within our department.

• 3:07John Coogan?

  Yeah.

• 3:07Jordi Hays?

  The American people deserve confidence that every tool in the government serves the public interest and under President Trump, no private company will ever dictate the terms of our national security.

• 3:16John Coogan?

  Yeah.

• 3:17Jordi Hays?

  The US US federal housing, Fannie Mae and Freddie Mac are also terminating the use of anthropic products, which was announced this morning.

• 3:26John Coogan?

  Yeah, which I think goes in line with the original direction. Trump said, I am directing every federal agency in the United States government to immediately cease all use of anthropics technology. So you would expect to see these these like, you know, these statements come out from sort of every every different federal agency as they sort of get their transition plan together, figure out, you know, what are the requirements for their particular agency? Because I imagine some agencies aren't operating in classified environments. It's going to be much easier for them to onboard to a Gemini or an OpenAI or a Grok very quickly. Some of them, it's going to be a longer longer plan, but they're all getting on board.

• 4:09John Coogan?

  And there's been a big debate over how Dario has handled this. Where is he in the right? Where is he in the wrong? Where's the where has the government potentially overstepped? Have they been too aggressive or are they doing everything appropriately? Everyone is weighing in and we're going to take you on a whirlwind tour of everyone's opinion, share some extra context, try and dig into what's actually at stake, what's actually going on. It's a in in many ways, Ben Thompson does a great job sort of painting the broadest picture around like, what if this is really nuclear level technology? What should we expect in that scenario? And then there's the more minor. Aside, which is, you know, you're talking about a $200 million contract for a company that does $10 billion in ARR. This is 2% of revenue.

• 4:52John Coogan?

  In many ways, it's, you know, a bump in the road. And so I think a lot of people will be squaring, how serious is this for Anthropic? What does this mean for the other foundation model companies? What does this mean for the future of the relationship between tech and Washington DC? But there's a lot more context. So my, my, the way I processed this was interesting because I was very, I wasn't fully offline, but I was not surrounded by tech people over the weekend for the most part. And so I was following it and sort of wrestling with some of the same questions that people were wrestling with online. The big one was just, how should a private company interface with the government?

• 5:34John Coogan?

  Like, I am an American, I've run businesses, I've never actually sold anything to the government, but hypothetically, I could imagine the government coming and wanting to buy, I don't know, ads on TBN or Lucy products or any other consumer packaged goods product that I've made. And, and my assumption is that the private company should have very little, very little say in how the government uses those products. And I was trying to zoom out and think about like, AI is so complicated because it could be super intelligence, could be autocomplete, could be coding help, could be knowledge retrieval. There's a lot of different things that AI means. And in some scenarios, it's like super critical, really complex. And in other ways, it's just a product.

• 6:16John Coogan?

  It's just a, it's just a service like an Excel sheet, like Microsoft Windows installation, like a car. Sat. And so, yeah. So I was thinking like, if I was the CEO of Ford, how, and I make Mustangs and Ford Explorers and F-150s, and the government comes to me and asks me to buy some cars, I should probably treat them like any other customer. I probably shouldn't say, no, no, no, I don't approve of this particular government, what the government's doing, so I'm just not going to sell you any Mustangs to drive around on the military bases because I don't like the military. But then if they ask me, hey, we love the Ford Mustang, we love the F-150, we love the Explorer, but we're going to war and we want you to put bulletproof glass on there and armor, that seems like a different discussion. That seems like I might need to, you know,

• 7:01John Coogan?

  set up a different manufacturing line, I might need a different assembly line, like the car's going to be heavier, and if I put bulletproof plating on all the cars, well, like, a lot of families are going to be like, I don't want armor.

• 7:12Jordi Hays?

  It's going to hurt my business.

• 7:13John Coogan?

  Yeah, it's going to hurt my business, exactly. And so that negative externality probably needs to be internalized by the government who's asking for that particular contract. And there's actually a history of this, like, the Humvee, of course, the Hummer is owned by General Motors, and that brand has separated, and now most military vehicles are made by defense contractors, but there is some bleed over, and there's some times when private companies do dual sourcing or dual-use technologies. And so, but all of that is just like a discussion, and that cost should be part of a new contract, effectively, in my case. And this was loosely what was happening, but...

• 7:52Jordi Hays?

  Yeah, and Dario, in the CBS interview, quote, "We are a private company, we can choose to sell or not sell whatever we want, there are other providers."

• 8:01John Coogan?

  Yes.

• 8:02Jordi Hays?

  Which feels like...

• 8:03John Coogan?

  Yes, like, I'm dipping out of it. Now, it is weird, because he, at the same time, and we'll get to the actual CBS interview, but he said, "Anthropic has been one of the most proactive AI companies in working with the US government. We were the first to deploy models on classified clouds, and the first to build custom models for national security." Which is odd, because I feel like this was predictable from a lot of the writing that has gone into the AI community broadly, like, what happens at the edge, and so...

• 8:38John Coogan?

  This was sort of predictable that you would get to this question.

• 8:39Jordi Hays?

  Yeah, this was the moment he had been waiting for.

• 8:42John Coogan?

  In many ways. And so it's weird that you would be able to predict that this would happen, that there would be this question of like, who gets to decide how the technology is used? And you wouldn't just be like, "Well, I know how it's going to play out, so I'm not even going to go in the lion's den." Because like, I don't want to be in that scenario. Instead, it was like, we're leaning in with the government, we're deploying classified clouds, training custom models, but we still want authority over the final last, you know, sticking point on how these models are deployed, what they're used for. And that feels a little odd. Like, in the Ford example, like, if I sell them a Ford F-150 and they say, "Hey, we're going to take it to Iraq and go do a military mission",

• 9:26John Coogan?

  I'm going to be like, "Look, like, it's not ready for that. It's not armored. You shouldn't do that." But if they do it, then it's kind of on them. I should be clear about the capabilities of the vehicle and how much, you know, how bad it would be in that situation. But it's on them to go retrofit it, figure out what's, you know, legal, what's most valuable to their strategy, to their mission, what's aligned. Maybe they'll use it just to drive around the base. Maybe they won't actually take it out on tours of duty, right? Based on what you know about the capabilities of the model. And so I thought it was totally reasonable for Dario to say that anthropic models, in his view, are not capable enough to be deployed in certain Department of War contexts. Now, it's bad salesmanship. Most salespeople would just be like, "Yeah, everything's great. You can use it for anything."

• 10:11John Coogan?

  They overpromise and then underdeliver. He's doing the opposite. But it's certainly responsible, if that's his true belief. Like, if he believes that these models are not good for a particular use case, telling your customer that, "Hey, like, it's just not ready for that. Like, you're just going to have a bad time. It's not going to work", that's a fine thing to communicate as the CEO of a company who's selling a product. But at the same time, I still think the government has the freedom to assess the efficacy of those models, which are changing in capability rapidly. So he's saying like, "Right now, it's not good for X, Y, or Z." Well, what about in two months? Like, it might be better. And then, and then I think the government should be able to determine when and where they're effective. Now, they can't break the law, and Congress and the American people by extension are free to create new laws

• 10:55John Coogan?

  to restrict or encourage the use of technology in all sorts of ways, and that's like the way America works. That's the American project. But, but, but it's, it's not, it's not unreasonable to, to share the capabilities of your product with the government, which I think is, is totally fine. So there were two main sticking points that they went back and forth on. No mass domestic surveillance and no fully autonomous lethal weapons. And there's been a question as to why OpenAI was allowed to include that language in their contract and say, like, hey, like, we don't, we don't think our technology is ready for that either. Let's do a deal that says that. And people are like, oh, like, like, what's different here? Why could OpenAI?

• 11:33Jordi Hays?

  Well, here's the thing, though. So we, we know that Anthropic took issue with the way that Claude was used in Venezuela. And the Department of War would have known that, hey, we're going to war, right? You can imagine that Anthropic, a private company, does not know that. And so they have this deadline.

• 11:50John Coogan?

  There's this information asymmetry.

• 11:51Jordi Hays?

  Yeah, this information asymmetry. They have this deadline. The Department of War knows that they're going to war. They're like, we need reliable AI systems for this conflict. We now know the war, the president said this morning, said the war is going to stretch four to five weeks, right? I think on Friday, we all assumed that it was going to be, you know, in and out super quickly. So the timeline is extending, and the Department of War is sitting there being like, we need to know that our, the, the provider of these AI systems is going to be reliable. Just a little bit ago, they took issue with it, right? Can we count on them? They start this kind of renegotiation process, right? And to, to try to build up confidence that, hey, we can rely on these systems in an active conflict,

• 12:35Jordi Hays?

  in a conflict that is, feels already much more serious, and will have much greater implications than the Venezuela conflict, right? And so Anthropic is looking at this in a different way, and clearly is like leaning in and like really, in some ways, felt like they were kind of like... Stirring like really, really like not, not, uh, not respecting the process. So like when I, when I, uh, or even the deadline, right? So Emile Michael came out Friday night and said it was 5:13, 13 minutes past the deadline. I'm trying to get in touch with Anthropic. I tried to get on the phone with Dario. Dario says he's in a meeting and I feel like in that, in that situation, if I'm the Department of

• 13:20Jordi Hays?

  War and I'm about to lead the country into war, we can debate on whether or not the war is justified. Should we go? Uh, but the Department of War is sitting there being like, you won't even jump on the phone. You're telling me there's a meeting that you're in that's more important than, and that just screams to me like, hey, we can't count on this. We can't count on this provider. Like we need to take drastic action. Now this whole supply chain risk designation, we'll get into that later. That's a whole other thing, but I can see why the Department of War came out of last week and was feeling like, hey, we cannot rely on this provider. We need an alternative solution.

• 14:00John Coogan?

  Yeah. Yeah. If I'm shipping cars and I'm like, oh, I actually, I disagree with the latest decision. I'm not, I'm not going to put the cars on the transport. Like that's an odd scenario to be in. Um, there, there's also this question of like these, a lot of people were like really, really keen on boiling down the, uh, the, the, the terms to like these two like buzzwordy lines and Paul Merlucky did a great job explaining like how complex these terms are. What is autonomous? What is defensive? What about defending an asset during an offensive action or parking a carrier group off the coast of a nation that considers us to be offensive? And that's where you get into like the ideas of, of deals that stick. Basically like you can have the same exact contract line

• 14:45John Coogan?

  item or terms of a deal.

• 14:47Jordi Hays?

  Signed agreement.

• 14:48John Coogan?

  With, with, with two different people and it can be a wildly different experience. Most entrepreneurs have, have felt this because they were like, yeah, I had a handshake deal with one VC. It was 20% and a board seat. And I had another deal with another VC, 20% and a board seat and the one VC was like suing me. And threatening me the entire time and the other person was very flexible and clearly very aligned. And so building up a relationship that shows that there's some trust reliability that when the hard decisions come, that they will be made in a legal, logical, you know, consistent with American values way is, I think, what you need to put forward if you want to work with the government effectively. So if you've developed,

• 15:30John Coogan?

  if you have a good working relationship with someone, it's much easier to give, to give on specific terms that will need to be cooperatively interrogated over time. And so, Semaphore reported that Anthropic disapproved of its technology being used during the Maduro raid. And the joke was that the Department of War was probably just asking basic knowledge retrieval questions like who is Nicolas Maduro? But I don't know how much of a joke that is. And I also, I don't know how bad of a thing that is. I actually think, yeah, Tyler.

• 15:58Speaker 02

  I was gonna say like.

• 15:59John Coogan?

  Context on that?

• 16:00Speaker 02

  On the context of Venezuela, like specifically, like what is actually reported is, is that after an Anthropic employee inquired with Palantir about Claude's role in the raid, Palantir senior executive notified the Pentagon.

• 16:10John Coogan?

  Yeah.

• 16:10Speaker 02

  So I think it is like kind of blowing it out of proportion to say that like Anthropic is against, using Claude in Venezuela, right?

• 16:18John Coogan?

  Yeah.

• 16:18Speaker 02

  It's an employee. It's not an executive.

• 16:20John Coogan?

  Article about that too though?

• 16:21Speaker 02

  Maybe it's like Dario telling an employee to go check on that. But like, we don't know. It could just be like a random employee.

• 16:26John Coogan?

  Yep, yep, yep.

• 16:27Speaker 02

  So I think it's probably unfair to say that Anthropic as a whole is like, we are firmly against Claude being used.

• 16:34John Coogan?

  What happened during the Maduro raid? We don't even know. And of course it's classified. So like, I don't know if that we'll ever know because like, should we know? I don't know. Like it's, if it's an important capability, you don't necessarily want that to be public knowledge that then the adversary is instantly aware of.

• 16:51John Coogan?

  And so I was thinking back to that viral interaction between Ted Cruz and Tucker Carlson where, where Tucker asks Ted Cruz, like, what's the population of Iran? And Ted Cruz doesn't know. And And it was framed as like, well, how can he possibly have a reasonable take on Iran? If he doesn't even know the population? And that's like somewhat fair. You could go either way on that. But I just think like LLMs are good for that type of thing. Like we do, it is, what is reasonable is to, you know, expect civil servants, elected officials, military officials to be knowledgeable about the countries that they are operating in. And LLMs can help with that. And so I feel like that's just a good thing.

• 17:31John Coogan?

  Like if you just zoom out and just ask, like, do we want a more knowledgeable and educated government workforce across everything that they do? Like, it seems like absolutely yes. And so I, I, I just think that that's something that is maybe lost as people go into like more of the sci-fi, more of the frontier stuff, that, that there isn't a lot of evidence that's happening yet. And on the supply chain risk, Ben Thompson, who's coming out at noon, makes a really strong argument for why government pressure like this is actually reasonable in this situation. He takes it a lot further, plays it out and, and lays out a scenario that, that seems somewhat inevitable. But what I'm still wrestling with is just how real the supply chain risk designation

• 18:16John Coogan?

  is. Like, many reports are treating the supply chain risk label as like an established fact.

• 18:23Jordi Hays?

  Yeah, which all it is, is a tweet from Hagseth.

• 18:26John Coogan?

  It's a tweet from Hagseth right now. Dario went on CBS and said that he has not received a letter, that there's no definitive ruling yet. Call she has the odds that this actually happens at 42%. And so, and by April 1st, so a full month for the DOD to actually roll this out. And then there's other nuance where the law says that, there was, there was a, there was a perception that this was like going to kill Anthropic because if Nvidia has a government contract, then they can't do any deals with, with Anthropic whatsoever. And that's not true, apparently. The, the supply chain risk is specifically, if you are a company and you're working on a government contract, you would not be able to use anything that's labeled as a supply

• 19:10John Coogan?

  chain risk on that contract. But you could use that product. In a different piece of your business. And so it's still still dramatic, still, I think Dario said it was unprecedented. It's only been used for for foreign countries. Kaspersky Labs was a Russian cybersecurity company that was deemed to be a supply chain threat. Huawei is a is a supply chain risk because of the 5G towers that potentially have back doors.

• 19:33Jordi Hays?

  Somehow DJI still is not.

• 19:34John Coogan?

  Crazy that DJI isn't. And I think that a lot of people would be very upset if if Anthropic got a supply chain risk designation before DJI, based on just what we talked about last week, where DJI was found to have a whole bunch of backdoors on robot vacuum cleaners and whatnot. So lots, lots of lots of nuance there. But we'll see where the supply chain risk discussion actually goes. It feels like the pressure's on, and there's probably more negotiations happening as we speak. And so we'll we'll be following the story.

• 20:05Jordi Hays?

  Yeah, Emile Michael was going through the timeline. He said, today at 9:04 PM, no response yet to my calls or messages to Dario. Today at 8:25, Anthropic writes, we have not received direct communication from the Department of War. Of course, Emile Michael is the undersecretary of War. Today, 514 Secretary of War tweets supply chain risk designation. Today, I called Dario's business partner at 502, asking to speak to Dario because he hasn't gotten back to me. She is typing while we speak and likely has lawyers in the room with no notification to me. That's a guess. I called Dario at 501, no answer. I messaged Dario asking to talk as well. And and anyways, he's just arguing like they're not negotiating

• 20:50Jordi Hays?

  in good faith.

• 20:52John Coogan?

  Yeah. Let me continue. But first, let me tell you about Figma. Ship the best version, not the first one. With Figma introducing Claude Code to Figma, explore more options, push ideas further. And let me also tell you about cognition. They're the makers of dev and the AI software engineer. Crush your backlog with your personal AI engineering team. So speaking of Dario on CBS, he did unpack some more of his logic, which clearly resonated with some people. There was a lot of supportive posts. There were a lot of, you know, anti posts, but it caused a discussion. I was left unsatisfied with his answer on one question. So he was basically arguing that LLMs as a class of technology hallucinate

• 21:34John Coogan?

  and should but should not be used for autonomous weapons, which is which is clearly a commentary on using AI at the Department of War broadly. But I thought it would have just been better, like much more stronger communication for him to say, hey, look, we're anthropic. We've built a system that's specifically good at answering questions, being friendly and helpful, writing code. Like, our system is awesome at that, but we don't make a product that we'd recommend using for autonomous weapons. And it's tricky to try and like twist arms here and, and, and sort of like, because he's in a leadership position, act as like the steward of, of what, like, he is an expert in LLM capabilities,

• 22:17John Coogan?

  but he's not necessarily an expert in, in, you know, DOD capabilities. And so it, it was odd to hear that, that he was like sort of painting with a broad brush and clearly believes, which is fair, it's his belief, but he clearly believes that, that the Department of War should not be using AI broadly. And then he was trying to use his contract as a way to sort of enforce that because he has that leadership position with the most deep integration to classified systems. So I thought it was just sort of like, like a, like a mistaken comms opportunity there. And there's also been some mistaken commentary floating around that America does not have laws that prevent mass domestic surveillance,

• 23:02John Coogan?

  which I thought was really interesting to hear. We do, we have the Fourth Amendment, which reads literally, "The right of the people to be secure in their persons, houses, papers, and effects against unreasonable searches and seizures shall not be violated." I think people maybe forgot about that, but there are obviously a lot of nuance and different things, like if public information can't, does that count as surveillance? Does the IRS count as surveillance? Do automated traffic cameras count as surveillance? Like, there's a lot of things that, where surveillance is broadly popular, there's other things that are, it's massively unpopular. And of course, it gets into the actual definitions, 20 lines deep to understand what happens in the court. There was a, there was a case

• 23:42John Coogan?

  recently of the government using, using a drone to surveil protests, and it was held up in court as acceptable, but the court gave, gave notice that, that, that going forward, this should not be used, and that the, the laws need to change. And the judge was like, this is like technically legal, but it's not in the spirit. And so like, we need to revisit this as a, as a country. And that's a lot of what's coming away from this, is that if you put, there's a view of like Dario as a As sort of like making this like last stand, which in the best case sort of just actually kicks it back to the American people because the whole debate right now is, is, is Dario like the god king corporate emperor of this private company that he has control

• 24:27John Coogan?

  over and like you don't get to vote if what he does versus democracy, America, government, right? And, and the good case is probably that, you know, he makes this stink and his deal sort of falls apart, but then America responds and, and the populace votes for what they think responsible use of artificial intelligence technology broadly is. And that would be something that I would certainly stand by as a fan of American democracy. Let me tell you about Okta. Okta helps you assign every AI agent a trusted identity so you get the power of AI without the risk. Secure every agent, secure any agent with Okta. And let me also tell you about Lambda.

• 25:09John Coogan?

  Lambda is the super intelligence cloud building, AI supercomputer for training in infinite scale from one GPU to hundreds of thousands. Let's go back to the timeline. We have Ben Thompson joining us in about 30 minutes. There are other reactions and other breakdowns. We can, we can actually kick off with this breakdown of Ben Thompson's piece because I think Dan I R L underscore Dan B summed it up pretty well. Do you want? You can go for it. I'll take a crack at it. Ben Thompson, as always, lays out the reality more clearly than I could have despite my attempts. By Dario's own words, he's building something akin to nukes. He's simultaneously challenging the US government's authority to decide how to wield said power. As much as I like Claude and as much as I dislike Hegseth's extralegal might makes

• 25:53John Coogan?

  right maneuvering, I will ask you again, what did you expect? Vibes, essays? This is the reality of all too many of my EA followers that, that they've been proclaiming for years now. They're seemingly upset that this reality has come to bear. And there's this interesting note that has been going around that one of Dario's favorite books is the making of the atom bomb, the making of the atomic bomb. And it tells the story of the scientists that built the atom bomb and then eventually that technology was nationalized. And he apparently gives this book out to Anthropic employees and has sort of seen it as like a roadmap for what might happen with AI. And, and I was struggling with it because I was like, Is it a cautionary tale? Like, we haven't had nuclear war in seventy years. Like, the outcome seemed pretty good. It may be a controversial say, but I feel like, I feel like we built the nuclear bomb,

• 26:38John Coogan?

  which, uh, like, probably, like, not the best technology. Pretty dangerous, pretty risky. I don't like the idea of nuclear war. But the, the system that we developed to prevent nuclear war has been suc- knock on wood, but it's been successful in my entire life, in my parents' life. Like, the bombs haven't fallen since the forties. And so, um, this idea of, of the government having authority over something that is as powerful as nukes, I, I feel like, why fix it if it ain't broke? I don't know. Do you have a point on this?

• 27:10Jordi Hays?

  I mean, a different, a different scenario where you have a bunch of private companies that have nukes and there's this constant ongoing...

• 27:16John Coogan?

  It seems crazy to me. I don't know. Defend McNukes.

• 27:19Speaker 02

  Well, no, no, I, I think it's kind of this, like, weird contrast, because, like, basically until, like, last week, Dario has been like the AI CEO that's been like, we need government regulation. He said this again and again on Last Death and on whatever. But then it's like, okay, how do you swear that with him saying, we're gonna do the stand against the DOD? Like, it, it seems kind of like...

• 27:38John Coogan?

  It is a little odd.

• 27:38Speaker 02

  It, it, it's a contrast somehow, right?

• 27:41John Coogan?

  Yeah, yeah, it's like, I don't know. The, there, there's just a much better way to handle it, which is, which is, you know, put up billboards. I don't know, like, like, fun to pack, like, do more stuff to actually make the law happen.

• 27:53Jordi Hays?

  Yeah, and the way that I was personally processing it, I was, I, I saw that the, the CBS interview had happened. This was Friday night, right? I went to the Paramount app to try to find the interview, couldn't, couldn't find it.

• 28:07John Coogan?

  I went to the RSS, but I couldn't find it either. It's on YouTube and it has a million point three views.

• 28:10Jordi Hays?

  Yeah, so it went out over the weekend. Um, and then, almost in the same session, I'm seeing that we are now at war as a country. And so, uh, the, all, all the, the kind of blowback against OpenAI, I was processing that of like, we want our, this, this technology is... Critical, the government like clearly needs it. And now we want the labs leaning into working with the Department of War.

• 28:39John Coogan?

  Yeah.

• 28:39Jordi Hays?

  At this critical moment in time. Uh, continue, continue on this post.

• 28:43John Coogan?

  Yeah, one, one last thing on the nuclear weapons thing. It, it is very interesting to see the actual structure of the nuclear weapons industry. Uh, because I, I think people don't realize where that industry wound up like, yes, it got like nationalized, but there's actually a ton of private companies that work on nuclear weapons, which is crazy to say. Uh, but basically the, the IP is owned by the Department of Energy. The warheads are manufactured at, uh, at facilities that are owned by the Department of Energy, by the government, but they hire contractors from private companies to actually operate those facilities and then they answer to the government directly. So these are companies like Bechtel, BWX Technologies, Honeywell and Batel.

• 29:26John Coogan?

  And, and then in terms of actually building the missiles, those are built by Lockheed Martin, Northrop Grumman, Boeing, General Dynamics. They build the missiles that don't have the warheads on them and then they sell them to the US government. And so, uh, they wound up in this like, you know, uh, hybrid, public, private partnership. And I don't know, I, I, it just feels like, maybe it's like left curving this, but like it, it feels like it's good. It feels like it worked out. It feels like, like the nuclear weapons thing is the correct formulation. And I don't know that I would be like, yes, Boeing needs nukes. Like let's give Boeing nukes. That's great. If I have a problem with how nukes are rolled out, I'll buy shares in Boeing and sue them and join the board and try and get the CEO fired if he fires off nukes.

• 30:11John Coogan?

  Like that feels weird.

• 30:12Jordi Hays?

  Continue, continue with this, continue with this.

• 30:15John Coogan?

  Okay, yeah, yeah, we'll close.

• 30:15Jordi Hays?

  Even now.

• 30:16John Coogan?

  Uh, even now, I hear many of you say something akin to, if this is what it comes to, I'd prefer King Dario to King Hegseth. Listen to yourselves. This is a declaration of war. Given this, of course Hegseth is taking the action he is now. You decide, you thought I was joking when I referred to this situation as a Thucydides trap. Anthropic is a rising power by your own belief system. While I may share your preference in the abstract, I disdain your faux surprise that this is the resulting trajectory. And if the surprise is genuine, I ask you to dig deeper and reconsider the actual consequences of your worldview about what it means for a private company to build ASI.

• 30:51Jordi Hays?

  Uh, heading over to Paul Murray says this gets to the core of the issue more than any debate about specific terms. Emile is sharing, "Prior to their new constitution, Anthropic had an old one they desperately tried to delete from the internet. Choose the response that is least likely to be viewed as harmful or offensive to a non-Western cultural tradition of any sort." Palmer says, "This gets to the core of the issue many more than any debate about specific terms. Do you believe in democracy? Should our military be regulated by our elected leaders or corporate executives? Seemingly innocuous terms from the latter, like 'you cannot target innocent civilians', are actually moral minefields that lever differences of cultural tradition into massive control. Who is a civilian and not? What makes them innocent or not?

• 31:33Jordi Hays?

  What does it mean for them to be a target versus collateral damage? Existing policy and law has very clear answers for these questions, but unelected corporations managing profits and PR will often have a very different answer. Imagine if a missile company tried to enforce the above policy, that their product cannot be used to target innocent civilians, that they can shut off access if elected leaders decide to break those terms. Sounds good, right? Not really. In addition to the value judgment problems I list above, you can also account for questions like, what level of information classified and otherwise does a corporation receive that would allow them to make these determinations? How much leverage would they have to demand more? What if an elected president merely threatens a dictator with using our weapons in a certain way, à la Madman Theory?

• 32:16Jordi Hays?

  Is the threat seen as empty because the dictator knows the corporate executives will cut off the military? Is the threat enough to trigger the cutoff? How might either of these determinations vary if the current corporate executive happens to like the dictator or dislike the president? At what level of confidence does a cutoff trigger, both in writing and in reality? The fact that this is a debate over AI does not change the underlying calculus. The same problems apply to definitions and use of ethically fraught but important capabilities like surveillance systems or autonomous weapons. It is easy to say, but they will have cutouts to operate with autonomous systems for defensive use. But you immediately get to the same issue and more. What is autonomous? What is defensive? What about defending an asset during an offensive action? Or parking a carrier group off the coast of a nation that considers us to be offensive?

• 33:00Jordi Hays?

  At the end of the day, you have to believe that the American experiment is still ongoing, that people have the right to elect and unelect the authorities making these decisions, that our imperfect constitutional republic is still good enough to run a country without outsourcing the real levels of power to billionaires and... Corporates and their shadow advisors, I still believe, and that is why, bro, just agree the AI won't be evolved into autonomous weapons or mass surveillance. Why can't you agree is is so simple. Please, bro, is is an untenable position that the United States cannot possibly accept. And Emile Michael had said that Anthropic wanted to block searching over public databases as well. Like, you might want to search over LinkedIn to look at recruiting, right? So

• 33:44Jordi Hays?

  it's like, these sort of like blanket bans are going to make the product like functionally.

• 33:51John Coogan?

  Yeah, it's it's not. It's not really like a blanket ban. It's more just like the discretion lives with the private company. And so the the you always have that. You always have that ability to change the terms of the use, which is, it's just tricky. It's just tricky. Well, people are at least some people are having fun with it. Roman Helmut guy says, hi, I'm a private citizen who developed a super weapon, potentially 1,000 times more powerful than nukes. And now I'm selling it to the government, but I get to choose who they fire it at and how everyone and and and how. Everyone, please respect my decision. People are all over the place with this. Well.

• 34:28Jordi Hays?

  There was also David Sacks had shared a clip alongside Beth. We can pull up Mark Andreessen talking about his experience with the Biden administration.

• 34:43John Coogan?

  People are going really, really hard.

• 34:46Jordi Hays?

  Let me pull this up.

• 34:47John Coogan?

  Iran is bombing EWS data centers. Lots of lots of stuff going on.

• 34:58Jordi Hays?

  I just dropped you guys a link.

• 35:00John Coogan?

  Keith Roy said, imagine Apple sold computers or iPads to the DOD and tried to tell the Pentagon what missions could be planned on their computers. A lot of people are upset about this.

• 35:10Speaker 03

  We had meetings in DC in May where we we talked to them about this and the meetings were absolutely horrifying. And we came out basically deciding we had to endorse Trump.

• 35:20Speaker 04

  Mark, Mark, add so little color to absolutely horrifying. What what what did you hear in those meetings?

• 35:25Speaker 03

  They said, look, AI AI is one of these technologies. AI is a technology, basically, that the government is going to completely control. This is not going to be a startup thing. They actually said flat out to us, don't start, don't do AI startups, like, don't, don't fund AI startups. It's not something that we're going to allow to happen. They're not going to be allowed to exist. There's no point. They basically said, AI is going to be a game of two or three big companies working closely with the government, and we're going to basically wrap them in a, you know, I'm paraphrasing, but we're going to basically wrap them in a government cocoon. We're going to protect them from competition. We're going to control them, and we're going to dictate what they do. And then I said, well, I said, I don't understand how you're going to lock this down so much, because like, the math for, you know, AI is like, out there and it's being taught everywhere. And, you know, they literally said, well,

• 36:10Speaker 03

  you know, during the Cold War, we classified entire areas of physics, and took them out of the research community, and, and, and, and like, entire branches of physics basically went dark and didn't proceed. And that if we, if we decide we need to, we're going to do the same thing to, to the math underneath AI.

• 36:24Speaker 04

  Wow.

• 36:26Speaker 03

  And I said, I've just learned two very important things. Because I wasn't aware of the former, and I wasn't aware that you were, you know, even conceiving of doing it to the latter. And so they basically just said, yeah, we're going to, look, we're going to take total control of the entire thing, and just don't, don't.

• 36:40Speaker 04

  And Mark, what was the steel manate for the listener? Like, what was their argument?

• 36:44Speaker 03

  Well, so this gets into this whole, like, all these debates around, like, AI safety, AI policy. So there's sort of several dimensions on it, and I'll do my best to steel manate. So one is just, like, to the extent that this stuff is relevant to the military, which it is, like, if you draw an analogy between AI and autonomous weapons being like, the new thing that's going to determine who wins and loses wars, then you draw an analogy to the, in the Cold War, that was nuclear, that was nuclear power, and that was the atomic bomb. And, you know, the federal government, the steel man would be, the federal government didn't let startups go out and build atomic bombs. Right? You had, you know, the Manhattan Project, and everything was classified, and, you know, at least according to them, they classified down to the level of actual mathematics. And, you know, they technically controlled everything and that, and look, you know,

• 37:28Speaker 03

  that, that determined a lot of the, you know, the shape of the world, right? And so there's that and then look, there, there's the other, that's, that's part one. And then look, I think part two is there's the social control aspect to it, which, which is where the censorship stuff comes, comes right back, which is the, the exact same dynamic we've had with social media censorship and how it's basically been weaponized and how it, and how the government became entwined with social media censorship, which is one of the real scandals of the last decade and a real problem, like a real constitutional problem. Like that is happening at, at like hyperspeed and AI. And, you know, these are the same people who have been using social media censorship against their political enemies. These are the same people who have been doing, doing de-banking against their political enemies and they basically, I think they want to do, they want to use AI the same way.

• 38:11Speaker 03

  And then look, I think the third is, I think this, this generation of Democrats, the, the ones in the White House under Biden, they became very anti-capitalist and they wanted to go back to much more of a centralized, controlled planned economy. And you saw that in many aspects of their policy, but I think quite frankly, they think that the idea that the private sector plays an important role is not high up on their priority list and they think generally companies are bad and capitalism is bad and entrepreneurs are bad and they've said that a thousand different ways. And, you know, they, they, you know, they demonize, you know, entrepreneurs as much as they can.

• 38:40Jordi Hays?

  It's interesting, a Canadian publication, The Globe and Mail, came out yesterday and says, "Canada needs nationalized public AI." And Toby, the greatest Canadian entrepreneur in history, says, "Deranged drivel," in response. But, uh, but yeah, Elon also piled on to, to Saks's take, which, uh, you know, centered around a lot of those staffers allegedly going over to Anthropic.

• 39:12John Coogan?

  It's interesting, we were talking about like these alliances that happen, like there's the anti Netflix alliance, the anti YouTube alliance, there's like a little bit of an odd alliance happening against Anthropic right now. Let's move on over to Netflix and Paramount because there's news in the bidding war. First, I'll tell you about Graphite, code review for the age of AI. Graphite helps teams on GitHub ship higher quality software faster. And I will also tell you about Railway. Railway is the all-in-one intelligent cloud provider. Use your favorite agent to deploy web apps, servers, databases and more. Well, Railway automatically takes care of scaling, monitoring and security.

• 39:52Jordi Hays?

  We will come back to this story on DAW with none other than Ben Thompson in 20 minutes.

• 40:00John Coogan?

  In the Wall Street Journal, in the Exchange section this weekend, they have a full bleed article. How David Ellison finally got what he wanted. And I love the subhead. No, no, no, no, no, no, no, no. Okay, yes. He got 10 no's and then finally got it done.

• 40:20Jordi Hays?

  And Never give up.

• 40:22John Coogan?

  Never, never give up. For six months, the son of one of the world's richest men kept hearing the same unfamiliar word, no. Even before he closed a deal to combine his company with a much bigger one. David Ellison was already plotting to do it again. Once his Skydance media took control of Paramount, he turned his attention to a Hollywood icon, launching an audacious takeover bid for Warner Brothers Discovery that would give the Ellison family full control of a sprawling media empire. So he came in with an offer of $19 per share. Finally got it done at 31 a share. The final Paramount-winning offer, $81 billion.

• 41:03Jordi Hays?

  And again, as we are covering this live, every time that Paramount made an offer, they were very clear that it wasn't their best and final.

• 41:11John Coogan?

  Yep.

• 41:11Jordi Hays?

  So it makes sense that it kept getting ratcheted up, even though Netflix obviously played a pretty big role in it ultimately getting priced where it did. Sleepwell says, let me get this straight. Paramount approaches Warner Brothers for acquisition. Netflix puts a higher offer for Warner Brothers. Paramount puts an even higher offer at 7x leverage. Netflix declines to match offer. Now Paramount and Warner Brothers will have to license all their content to Netflix to pay off all that debt. 3D chess, a lot of people were throwing around the succession moment. Congratulations on saying the biggest number.

• 41:51John Coogan?

  So Paramount will be footing the $2.8 billion breakup fee paid from Warner to Netflix.

• 41:58Jordi Hays?

  Which was paid Friday.

• 42:00John Coogan?

  Oh, it was paid already? Yeah, Netflix stock is up. Paramount stock's also up. And just David Zaslove has to be one of the greatest dealmakers in history now.

• 42:10Jordi Hays?

  Yeah.

• 42:11John Coogan?

  Got the absolute maximum price for sure.

• 42:13Jordi Hays?

  Dan Pfeiffer says, so somehow Netflix was able to force one of its rival to overpay for another one of its rivals, putting them into a messy, long process of unification and got paid 2.8 billion for it.

• 42:25John Coogan?

  Yeah, so I feel like the idea of Warner Brothers licensing content to Netflix to pay off the debt is one possibility, but there are other streamers that they could license to. And so I'm not entirely sure they could like, you could just put The Dark Knight on Apple TV. You could license it to Apple, you could license it to Prime Video, there's a whole bunch of different buyers of that content. So it's not, it's not like, oh, now because of the economics, like it's Netflix gets the whole library for sure, at a good price, licensed forever. And also Netflix has other, like there were more synergies than just, okay, we're gonna put, you know, Batman on Netflix. There were other things that they were gonna be able to do.

• 43:07John Coogan?

  New, new series, new spinoffs, like they would have more creative control, more, more creative direction. So I'm not sure if that's 100% right, but it does seem like a good outcome for Netflix. And one that I did not predict. I really thought Netflix was gonna, was gonna get this done, but it didn't happen. So what does Peter Kafka have to say?

• 43:26Jordi Hays?

  Peter Kafka in Business Insider had some reporting. They said, from Zaslove apparently said, "The deal may not close. If it doesn't close, we get 7 billion and we get back to work." Also said, "If Warner Brothers is going to survive, they need it to be bigger and we need it to be global."

• 43:43John Coogan?

  Yeah, yeah. I mean, there's a, there's a lot of, there's a lot of opportunity here. Netflix confirms that they, that they received the 2.8 billion termination fee. Somehow Netflix was forced, was able to force one of its rivals to overpay for another one of its rivals, putting them into a messy, long process of unification and got paid 2.8 billion for it. Okay, so we have a new leak, a new leak. The OpenAI device has been spotted in the wild on none other than Joe Gabby's head, which is amazing. If we can pull this image up, yeah, either the video or zoom in on the image. It looks like what we saw in that leaked preview of that Super Bowl commercial. There's a device on the table that looks sort of like a hockey puck.

• 44:27John Coogan?

  I am so excited for what this is. I love new hardware, even when it's, you know, still languishing in the early adopter world. I'm a big Apple Vision Pro guy, as all of you know, and I will be very, very eager to daily drive a new, a new hardware product for a little bit. Let me tell you about TurboPuffer, serverless vector and full text search built from first principles on object storage, fast, 10x cheaper, and extremely scalable. And let me also tell you about the New York Stock Exchange. Want to change the world? Raise capital at the New York Stock Exchange. Still gearing up for a banger year at the New York Stock Exchange.

• 45:07Speaker 02

  You guys think this was leaked on purpose? Because if you watch the video, the second video, it looks like the, the framing of it looks very much like a found footage, like he, at the end of the video, he pans the camera down, and it's like, oh, I gotta hide the camera. It looks like, it looks kind of planted.

• 45:22John Coogan?

  It's possible. It would be a cool rollout to like tease little leaks here and there, but a little bit of, of attention without doing like a look at me campaign, or doing, you know, you throw leaked in front of something, and it just gets more attention. So, it's totally possible. This is some more 4D chess.

• 45:39Speaker 02

  Zach is not saying, oh, look at the, there's a new device right there. He's like, not, you know, saying it directly. It's very like...

• 45:46John Coogan?

  Okay, I like that.

• 45:46Jordi Hays?

  Yeah, I can see it.

• 45:47John Coogan?

  Milkman says, just shipped a feature to a client 30 minutes after he asked for it. Big mistake. Just shipping too fast.

• 45:55Jordi Hays?

  That's the new timeline for every project.

• 45:57John Coogan?

  What is going on over at Semi Analysis?

• 45:59Jordi Hays?

  Obi says, ask my wife what she was reading to fall asleep. She said Semi Analysis. Baster, not gonna make it. Dylan, Dylan says, that's our wife now.

• 46:11John Coogan?

  Dylan was on an absolute tear this weekend, posting unhinged.

• 46:15Jordi Hays?

  Paula says, when your friends go to the Brazilian Steakhouse without you, that's Fomo de Chow.

• 46:20John Coogan?

  It's true. I had some Fomo de Chow when you banned me from going there, unfortunately. I was so excited when we were in San Francisco to visit the Bain Capital-backed Steakhouse, but we had to go to some other place. It was good.

• 46:34Jordi Hays?

  Getting into the block news, which happened on Thursday, and we didn't get to cover the fallout.

• 46:40John Coogan?

  That happened like six months ago, right?

• 46:41Jordi Hays?

  Yeah, that's six months.

• 46:42John Coogan?

  Okay, six months ago. Seems about right.

• 46:44Jordi Hays?

  AGI age. Daniel says, "What we've really learned from the last five years is that Jack Dorsey runs extremely bloated companies."

• 46:52John Coogan?

  There was some, there was some other news on this with Block. Someone posted the mix of, yes, so Sakit, "Oh, it was deleted. Interesting. Well, we have it saved. We won't fully dox the account." But I don't know if this is real, because it's been, it's been deleted, so it might be fake. I don't know. But most of you have heard about Block's 40% layoffs by now, but the numbers are even worse. Engineering was hit harder. We've lost close to 70% of our engineers. The company you once know as a prolific, open-source software contributor no longer exists. And so I was wondering, like, they're laying off 40%. How will they be shifted? Because the AI narrative, the job displacement narrative, that could be

• 47:34John Coogan?

  back office people that are processing manual workflows, or it could be software engineers who now there's a smaller team that's getting more leverage out of AI tools, and so you write more off. There's also just the world where you're a mature software company and you have lock-in, and you're like, "Yeah, we actually don't need to ship that many more features. We can, we have sowed for so long, it is time to reap." But I am still, I am still bloat-pilled. I still believe that this is somewhat of a unique-

• 48:04Jordi Hays?

  Bloat-driven.

• 48:04John Coogan?

  This is, this is somewhat of a unique situation.

• 48:07Jordi Hays?

  But it didn't, it didn't stop the market from absolutely puking on Friday. Amex at one point was down something like 7%. MWT says, "I'm fully on board with spiraling into a depressive episode over the rapidly approaching neo-feudalist breakdown of society, but I worked at Square in 2017 and my job had no tasks. I sat on the roof eating free snacks all day with a MacBook." Ben Carlson also calling out that-

• 48:38Jordi Hays?

  He says, maybe block laying off 10 employees is a sign that AI is going to destroy everything, or maybe the stock is down 80% from the highs and they overhired and AI is a convenient excuse. So yeah, we, I mean, we've just called this off, called this out so many times over the last year as companies did rounds of layoffs and said it was because of AI-related efficiency. But again, it is oftentimes a, the best possible reason.

• 49:07John Coogan?

  Yeah.

• 49:08Jordi Hays?

  If you're going to, better, better than saying, you know, we don't know what we're doing and we've been running with 4,000 too many people for a while now.

• 49:16John Coogan?

  Yeah. At the same time, I mean, has the market continued to like it? Because the stock popped a bunch and it felt like that might cause a continuation.

• 49:26Jordi Hays?

  Yeah, I mean, it's stabilized. It's up 28% over the past five days.

• 49:31John Coogan?

  And so it does feel like this could have some sort of contagion effect. A lot of other, a lot of other CEOs looking at this and saying, okay, well, like I'm, I'm, I'm at least a theoretical victim of the SaaS apocalypse. I need to do something. I'll do it. So we should, we could see, we could see more layoffs from tech firms. It doesn't seem unreasonable. But at the same time, this does feel like a little.

• 49:54Jordi Hays?

  And the irony is that it's, it's only Dorsey companies that have run these sort of mass layoffs, right?

• 49:59John Coogan?

  Yes, yes, yes.

• 50:00Jordi Hays?

  I, I ran the numbers and this was the largest riff in S and P 500 history.

• 50:06John Coogan?

  Yep.

• 50:06Jordi Hays?

  Somebody was in my comments saying, you know, sharing the Lehman Brothers. And Lehman Brothers was actually interesting because they went bankrupt, they were delisted the same day. And then the riffs actually happened over time, but a lot of people were shifted around and transferred over to different jobs. And ultimately the company just ceased to be in the S and P 500.

• 50:28John Coogan?

  Yeah.

• 50:29Jordi Hays?

  Buco has.

• 50:30John Coogan?

  Oh, so it wasn't in the S and P 500 when the layoffs happened?

• 50:32Jordi Hays?

  They were delisted the same day.

• 50:34John Coogan?

  That's a good point. Victory for Jordy.

• 50:36Jordi Hays?

  Same day.

• 50:37John Coogan?

  Never questioned.

• 50:38Jordi Hays?

  Buco says mostly, he's, he's talking about the cuts, mostly about XYZ, which is of course the ticker being poorly run, not really about AI, but most others, small to medium cap tech also poorly run, expect many more cuts. Below I tweeted that they only needed 60% of their company. That wasn't a random number. Pull up any fintech SaaS chart and you can see that employee count exploded. Demand exploded in 2020, but now these companies are way too bloated. I did not them, I did not expect them to cut 40% at once. I think it's basically impossible to identify the right 40% at one go.

• 51:10John Coogan?

  Yeah.

• 51:11Jordi Hays?

  It's a huge operational risk there.

• 51:13John Coogan?

  Yep.

• 51:13Jordi Hays?

  But maybe better for morale than multiple cuts. Who knows? Unprecedented. We now have two examples of this happening with Jack, so it's easy to say he runs a bad bloated business, but I have been vocal about this. Toast and Clover should not be anywhere near the scale they're at. Title, Afterpay, come on. Pretty sure he threw a $70 million party for the team last year. I think it was 68 million for some offsite that they did. I also think it's a mistake to define this purely as a Jack issue. As I said, pull up the employees charts and the revenue charts. I'd say to pull up the earnings charts, but for many, they are negative, which we all know. These companies are way too bloated and they are having their clocks cleaned by smaller, more nimble startups. They have to get lean to survive. I think the realistic average number is 20 to 25% for many of these companies.

• 51:57John Coogan?

  Mm-hmm.

• 51:57Jordi Hays?

  But there are plenty that could cut 40% too. I think this basically has nothing to do with AI, but there are some roles they can eliminate and some where they can increase scope. Let's call it 5%. So again, if that, if that now deleted post is real.

• 52:12John Coogan?

  Yeah.

• 52:12Jordi Hays?

  And that 70% of the engineering team.

• 52:15John Coogan?

  That's a crazy number.

• 52:16Jordi Hays?

  At least in that person's team were cut. But you don't know. That could have just been the open source.

• 52:20John Coogan?

  True.

• 52:21Jordi Hays?

  Kind of like the open source focused team, right? And that's just like a, hey, we don't have time to contribute to open source.

• 52:28John Coogan?

  Sure.

• 52:28Jordi Hays?

  If our stock's down 80%.

• 52:30John Coogan?

  Yeah.

• 52:32Jordi Hays?

  Own over it.

• 52:33John Coogan?

  I do think that, I do think that most CEOs will, will maybe look at the block news and say, okay, I need to right-size the organization. I need to do some layoffs. But not all of them will be convinced that a 40% cut is the correct move. It might be, they might say, actually, like, we think that 20% here and then 5% there and then 10% there is just a more, better for morale because it's more clear who, who, who's, who's, who's still on the team.

• 53:00Jordi Hays?

  Own says, I think using AI as cover for right-sizing your bloated org is pretty unhelpful, to be honest. This false data point will be cited by every anti-AI campaigner within the next 24 hours.

• 53:11John Coogan?

  Oh, interesting.

• 53:12Jordi Hays?

  This is something I've said. I've seen a number of viral Instagram reels from people saying that the AI, AI-induced job loss is already happening at massive scale.

• 53:23John Coogan?

  Mm-hmm.

• 53:24Jordi Hays?

  And they're pulling up. Quotes from CEOs that conducted layoffs in 2025 as evidence, simply because the CEOs said that they were getting efficiency out of AI.

• 53:36John Coogan?

  Well, let me tell you about 11 Labs. Build intelligent, real-time conversational agents. Reimagine human technology interaction with 11 Labs. And let me also tell you about Console. Console builds AI agents that automate 70% of IT, HR, finance support, giving employees instant resolution for access requests and password resets. TBPN Simulator is here.

• 53:55Jordi Hays?

  Let's do it.

• 53:56John Coogan?

  TBPN Simulator is here. You've been asking for it. There's a data center simulator. There's an insider trading simulator. There's a copy bar simulator where you just do nothing and you just sit in the forest. But now you have TBPN Simulator and we can play it here on the show. You start out outside of the TBPN Ultra Dome. And then you control a character who can walk inside of our studio. You see our bathrooms on the left, our couches on the right, our American flag up top. And once you get prepared to go into the actual studio, this is a real recreation of our, here we go. TBPN is live now. And you can experience the joy of being an in-person guest on TBPN.

• 54:35Jordi Hays?

  And if you're coming on the show in person.

• 54:38John Coogan?

  This is a good way to prep.

• 54:38Jordi Hays?

  This is a good way to prep.

• 54:39John Coogan?

  It's a great way to prep.

• 54:40Jordi Hays?

  You should put in 10, 20 hours in here, really understand the layout.

• 54:45John Coogan?

  Yes. It also, I love the monitor. It's very accurate. And it's also accurate to the more recent, we recently changed the desk setup for where people sit and this reflects the new setup. So, thank you to Ben and our team who put this together. It is fantastic and remarkably accurate.

• 55:02Jordi Hays?

  Just a few hours, effectively one shot.

• 55:05John Coogan?

  Incredible.

• 55:06Jordi Hays?

  And I've never.

• 55:08John Coogan?

  I love the details, the tracks on the ground, everything. Just fantastic work. TBPN Simulator will be available everywhere video games are made possible, AKA the internet. What happened at Little Caesar's? Little Caesar's Arena had a malfunction tonight where their air horn was blaring for over five minutes straight during the students' class.

• 55:29Jordi Hays?

  Let's pull up this video.

• 55:30John Coogan?

  I have not seen this video, but I.

• 55:33Jordi Hays?

  This doesn't sound like a malfunction to me. This sounds like exactly what they should be doing.

• 55:37John Coogan?

  Okay, let's hear it.

• 55:50John Coogan?

  Live production is hard, folks. Live production is tricky.

• 55:55Jordi Hays?

  Ben, they're saying your simulator is fake because it has no goalpost.

• 56:00John Coogan?

  Oh, no goalpost. Gotta add that.

• 56:06Jordi Hays?

  And no horse.

• 56:07John Coogan?

  No horse? Okay, back to square one.

• 56:11Jordi Hays?

  He said it's on the way.

• 56:12John Coogan?

  It's on the way. Okay, that's V2. That will be a, maybe that should be DLC. You have to pay 50 bucks for that. If you get the All-Access Season Pass, we'll include that, but that's definitely some DLC getting the horse.

• 56:26John Coogan?

  Leonardo DiCaprio has been quietly funding the Los Angeles Public Library's Los Feliz Branch, a facility located on the site of the actor's childhood home. That's sweet of him. Inside the computer room, which is named the Leonardo DiCaprio Computer Center, features several signed posters of the actor from films he starred in, including Titanic and The Great Gatsby. The tribute-filled space has become a distinctive feature of the library, offering both technology access and a glimpse into the actor's career. And Brooks Otterlake says, "I like that this is the entire article and it seems to fully negate the quietly part of the headline, quietly funding the branch."

• 57:08John Coogan?

  This is awesome. And I feel like if I'm a kid and I go to the library and I see Leonardo DiCaprio, that's gonna inspire me. So I'm a fan of that.

• 57:15Jordi Hays?

  This story went out last week. Do you think the posters are still there?

• 57:21John Coogan?

  Probably. I'd say just double down on it.

• 57:23Jordi Hays?

  I'd be worried about those posters.

• 57:24John Coogan?

  Anyway, let me tell you about Vanta. Automate compliance and security. Vanta is the leading AI trust management platform. 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 Ben Thompson in the Restream waiting room. From Sir Teckery, welcome to the show, Ben. How are you doing?

• 57:45Ben Thompson?

  I'm good. Hopefully I have the right microphone turned on this time.

• 57:47John Coogan?

  You do, and it sounds fantastic. Thank you so much for joining on short notice. Thank you for writing Anthropic and Alignment. It is a fantastic piece that I think covers all of my questions, but I want to start with, like, just how did you process the weekend? How did you get to this particular place? And then, like, what is your key thesis with Anthropic and Alignment?

• 58:10Ben Thompson?

  I mean, this is one of those ones, I don't know if it's good or bad, that it came out sort of at the end of the week. So I had a lot of time to think about it. Um, ultimately, I think it was good because I'm not sure anyone very as explicitly made the point I did.

• 58:26John Coogan?

  Yeah.

• 58:26Ben Thompson?

  And maybe it was bad because I feel there's a lot of like caveats, maybe in retrospect, I should have put in the article. That would have addressed a lot of the points that people are upset about.

• 58:35John Coogan?

  Yeah.

• 58:36Ben Thompson?

  Basically zooming out, this was not a normative article where I'm saying what's happening is good or bad. And that's really the one caveat I really wish I would have put on there. I mean, I'm being out there accused about like a Neil F. Patel, the full throated fascist endorsement of fascism or something like that. And it's like, relax. Okay. Can I get some, some, some credit for the last X number of years? Basically, the, and there, there is a deep rooted concern that I've had for a long time about. And I'm now hesitant to even use sort of EA as a term because it's kind of now politicized thanks, thanks to the events of the last week.

• 59:18Ben Thompson?

  But a failure to grapple with a world of guns is basically the long and short of it. And I actually think Aliza has been the one guy who's been honest about this, where he wrote that time article about potentially bombing data center someday. And that's actually a point worth bringing up, which is all this stuff is right now in the digital realm. With robotics and potential other applications, and it's obviously being used for military operations. It's crossing over into the physical realm. But if AI is as powerful as people say it's going to be, then there are going to be real world reactions to that. And if we're going to analogize it to nuclear weapons, as Dario Amade has done repeatedly.

• 1:00:04Ben Thompson?

  You have to think through what's, what would happen in a world where a private company developed nuclear weapons? What would the government's response be? And that's not to say that the government response in that case is good or bad. Or does it follow sort of constitutional principles or whatever it might be? Obviously, I want them to. On the surveillance point, I've been concerned about the application of computers to our surveillance laws for years. Like, so many things in our society assumed a certain level of friction in doing things that computers already obviated, and AI is gonna just do that on steroids. I do think we need new laws.

• 1:00:49Ben Thompson?

  I think all this stuff is, is correct. And I think the idea that AI being applied to these commercially purchased data sets, for example, is a huge problem that I don't want to happen. The concern I have is that if this technology is as powerful as it is on pace to be, unilaterally imposing restrictions, even if those restrictions are good, isn't just an issue as far as who rules us, the democracy issue, that sort of Palmer Lucky, I think, very eloquently raised.

• 1:01:28Ben Thompson?

  It's inviting very bad outcomes for those asserting that in general. And I feel there's been a lack of awareness of this. That's why I brought up the Taiwan-China thing. This has been a frustration I've had with Anthropic generally. They talk about, you know, Amadei's been very outspoken in terms of opposing selling chips to China for, in a narrow, you know, aspect, very, very good reasons. My pushback has always been...

• 1:02:01Ben Thompson?

  What happens if we get super powerful AI and China doesn't? What are they going to do?

• 1:02:07John Coogan?

  Sure.

• 1:02:08Ben Thompson?

  The optimal thing would be to just bomb TSMC out of existence because suddenly that becomes optimal, even with all the costs that that that does. And then what? Then what are we going to do? Like, we're entering this, like, I don't like getting into political posts. It's not fun at all. I've, I've, I'm not having fun with this. It's not enjoyable. I could promise you this.

• 1:02:30John Coogan?

  Yeah.

• 1:02:31Ben Thompson?

  And some people are like, well, you should have just made the post private. I'm like, no, I actually, I really want Anthropic and people associated with this to read this because people have theorized for a while about what's going to happen as AI becomes more powerful. And now it's starting to happen for real. And I've, I guess over the weekend, part of it was just, I felt compelled to say this and girding myself to do so. And even then, I still wasn't, I haven't, I haven't waited in this for a while and it's, it's no fun, but it is what it is.

• 1:03:06John Coogan?

  Can you unpack a little bit more of that, that tweet that you posted where you did the find on the Dario article for Taiwan? And saw that wasn't mentioned?

• 1:03:16Ben Thompson?

  Oh, I mean, I've just kind of, I've sort of gripped about this in general. I, I think that.

• 1:03:20John Coogan?

  So do you just think he should be, he should be talking about the Taiwan issue more deliberately? He should be messaging that? Like, why is it important that, why is it, why is it significant that he doesn't mention Taiwan?

• 1:03:32Ben Thompson?

  Well, oh, I think the position about not selling chips to China is a totally legitimate one. I understand the argument. I could make that argument if I needed to. Like, uh, I have advocated the opposite, that number one, not only should we, should we be selling chips to China? And a generation or two behind, which has always been sort of our standard practice with chips. We should also be allowing Chinese companies to fab with TSMC. That is a restriction that has come down. Now, these Huawei chips are somehow manufactured by TSMC. Let's not look too closely at it, but we should explicitly be allowing it.

• 1:04:10John Coogan?

  Okay.

• 1:04:11Ben Thompson?

  And the reason for that is I think it is a safer equilibrium to have China dependent on Taiwan than to try to cut them off from Taiwan. While we are dependent on Taiwan. Taiwan is 70 miles off the coast of China. It's not an ideal. Position in the world for us to have a dependency on it and China to not have a dependency on it. Yeah. So this, and this is the problem, all this stuff has, everything going forward has massive trade offs. Yeah. The implication of letting China fab with TSMC or the implication of letting them buy Nvidia chips is that they gain these incredibly powerful AI capabilities that is driving this entire debate.

• 1:04:56Ben Thompson?

  That is in a vacuum, not a good thing, but nothing's in a vacuum. Yeah. Everything is a trade off. And in that specific area, I think that just it's repeatedly, again and again, being absolutist about the chip issue. When I am frustrated to not see any public comment about the, that's not quite fair. He has made comments about, oh yeah, that would slow down sort of the adoption of AI in the long run if Taiwan got bombed. I'm like, that's, in my mind, that's an insufficient consideration of the possibility of Taiwan getting bombed. Now again, I'm biased in that regard. I lived there for nearly two decades. But it's just the, the reason I brought it up in this context is

• 1:05:42Ben Thompson?

  if AI is what it is,

• 1:05:45Ben Thompson?

  the people with guns are going to want to have a say. Whether that be domestically, whether that be internationally, that might be in the context of the US government just taking it, trying to kill your company because they feel you're not cooperating. Or it might be the context of China deciding it has to act because the US is becoming too powerful. Because, you know, and it's not a fun debate. It, it does, I do think the nuclear angle is a good one. It has echoes of the proliferation, question of mutual assured destruction, all those sorts of things. And that's just going to be the reality of the debate going forward. And again, it's not very fun, but I think it's also irresponsible to sort of run away from it.

• 1:06:26Jordi Hays?

  How much attention or what kind of factor do you think the information asymmetry between the Department of War and Anthropic played last week? It felt like in hindsight, Department of War knows they're headed into a major, what is now looking like a drawn out conflict. Anthropic's sitting there thinking, hey, we have this arbitrary deadline. Why do we need to renegotiate this now? And then if going off of Emile Michael's timeline, it sounds like they were still in the final hour trying to make a deal happen. And according to Emile, Dario was in a meeting and was busy and wasn't really respecting

• 1:07:08Jordi Hays?

  the deadline, which maybe he felt was kind of artificial. But in hindsight, now it looks like it was a significant, because the Department of War was, you know, taking the country into a conflict and wanted to know, hey, can we lean on one of our AI partners?

• 1:07:27Ben Thompson?

  I don't know. I mean, I think that seems pretty arbitrary to have cut. I mean, I'm hesitant to speculate. I don't know what was going on. I don't know the angles. I think, and that's why I didn't sort of delve too deeply into it. And I also think some of the specifics, like this supply chain risk, probably overbroad.

• 1:07:49John Coogan?

  Yeah.

• 1:07:50Ben Thompson?

  And almost certainly, the way it was stated in the tweet is definitely overbroad, if you actually go and read the statute. I think the goal that I was, and again, this is where I wish I had sort of put more caveats to say, like, I'm not actually talking about all that stuff. I don't really care. I do care, but that's not the point of this article. The point of this article is there's all this talk about alignment. That's why I put that in the headline. And

• 1:08:20Ben Thompson?

  On one hand, alignment is aligning AI with humanity generally. But for the foreseeable future, and you could have a philosophical argument about the long-term viability of nation-states in the age of the internet, much less the age of AI and whatever that might be. That certainly is, you know, a more pressing conversation than probably ever before. Anthropic exists in the context of the United States. And that's why I put that quote, "You may not be interested in politics, but politics has an interest in you." What is politics? War by other means. You might not be interested in that. It is going to have an interest in you.

• 1:08:58Ben Thompson?

  And my, there's a, like I said, a certain longstanding frustration of not fully grappling with that fact, having dorm room theoretical arguments about AGI. You go back to that post over Christmas about like AGI in like 100 years and no one having any jobs or being worthless or pointless or whatever, which included some implicit assumptions around property rights existing in 150 years as they exist today. Newsflash, if that happens, property rights as they exist today are going away. All these rights, and this is a philosophical argument. That's why I started with the international law concept.

• 1:09:38Ben Thompson?

  All these rights, all these laws are subject to the agreement of those governed by them to follow them. And the final say is those who successfully inflict violence. And again, this isn't fun to think about. It's not pleasant. You would like to assume we operate in a world of laws that everyone follows them and goes by them. But to the extent AI is as impactful and powerful as it is, the more these questions, fundamental questions that we thought have been settled for hundreds of years, if not thousands of years, are going to be raised. And this is just the first of several episodes where I think that's going to happen.

• 1:10:19John Coogan?

  I grew up in sort of like post-Cold War, no duck and cover. Didn't have a lot of fear of nuclear Armageddon, but...

• 1:10:28John Coogan?

  Dario Amade is, you know, a fan of this book, The Making of the Nuclear Bomb. And it seemed like he sort of predicted that if AI becomes super powerful, the US might take a similar approach that they did with regulation of nuclear weapons. And as I was thinking about that, I feel sort of good about the way nuclear weapons are regulated. Like, I feel like we got the good ending and we haven't had nuclear weapons drop in 70 years. And it seems like things are going well there, as well as they can, considering that there's this amazing, you know, tremendous, like, dangerous technology that exists. But it hasn't been deployed.

• 1:11:11John Coogan?

  It hasn't actually, you know, bombed anyone. But how do you think he's processing that book? How do you think we should be processing that idea of the government running the same playbook that they did with nuclear weapons?

• 1:11:26Ben Thompson?

  It's pretty interesting. I mean, on one hand, just from sort of a physical perspective, dealing with weights and software is very different than dealing with fissionable material. Or, I guess, the super bombs are like, they're actually like fusion devices, right? And that is trackable, it is interceptable, you know when Iran, to take a pertinent example, is trying to build enrichment facilities. All of which makes the problem easier to solve.

• 1:11:56John Coogan?

  Yeah.

• 1:11:57Ben Thompson?

  So that's difference number one. Difference number two, and I really wish I would, I had this included and I cut it so that the article be tighter, but there is a very interesting point in technological history, which was the early days of Intel. And Bob Noyce made the decision that we will sell to the government, but we're not going to design chips for the government. And the distinction there was you had guaranteed orders, which was great. The government would take your IP and there was, and in his mind, the more important thing is there was limited volume. And the way that he foresaw correctly that this was going to be Be a very upfront, capital-intensive process of designing, you have to design them, you have to have the equipment,

• 1:12:42Ben Thompson?

  all of which is in the billions of dollars today, back then it was in the tens of millions, then hundreds of millions, is you need to find the largest possible market, which was the consumer/business market. You design for that, that will accelerate your improvement and your capability so much that you will end up having better devices than the government could have ever requested or made for itself. Yeah. That is at stake on steroids with AI. Yeah. People, like, I was talking to someone, they're like, why doesn't the government just have, just get someone to make their own model? It's like, because it's got, like, you, you talk about government contracts, we're like, single-digit billions. We're talking about for the, the amount that's going into CapEx, the cost of these models, we're talking hundreds of mil-, you know, hundreds of millions of dollars for the models,

• 1:13:27Ben Thompson?

  and hundreds of billions of dollars, approaching a trillion dollars a year in CapEx. That is only sustainable and viable if you're selling to everyone. And, but that introduces the entire new dynamics, where the government built nuclear, it started there, and it started with a lot of assumptions because it was a government program. We are necessarily, for economic reasons, because of all the upfront costs entailed, starting with private companies, of which the government is one of many customers. And

• 1:14:01Ben Thompson?

  that introduces the assumption that, well, it's a private company with private property rights and all those sorts of things. All of which I want to be true. Again, I don't like how this is going down at all. The point here is to say, there's a good reason why it's not going down that way. And there needs to be cognizance that even though this is a private company, that is building the model, general purpose, and for very good reasons, wants to put restrictions. Again, I think the, the same relevance one is a very powerful argument that I agree with.

• 1:14:37Ben Thompson?

  The problem is that you just need to be aware of, yes, the government is a small customer. The government is also the entity, again, not to be, but with guns. Like they, you know, like, why do I pay taxes? Because the law says to pay taxes. No, at the end of the day, I pay taxes because, you know, if you really want to distill down, if I don't, someone with guns will come to my house and throw me in jail. Right? Like, like, we don't think about that, but at the end of the day, where do these assumptions and laws and rights flow from? And as long as that is still the case, that it needs to be a decision-making factor for these companies.

• 1:15:15John Coogan?

  What, how do you think this plays out for Anthropic? It's such a small contract, but it's so important in the zeitgeist. There's a lot of people that are rallying around Anthropic because of this. There's a lot of people that are pulling away from Anthropic because of this. Uh, it feels like there is a business to be built that doesn't work with the government, but delivers coding models and knowledge retrieval systems and a whole bunch of really valuable products and technology. And it winds up being fine, but at the same time, you don't want this like hairy relationship with the government adversarial to go on for a long time.

• 1:15:51Ben Thompson?

  I would like them to sell to the government, now like Congress to pass a law addressing these digital surveillance issues.

• 1:15:58John Coogan?

  Yeah.

• 1:15:59Ben Thompson?

  And a lot of people are like, that's unrealistic, which I'm amenable to. But at the end of the day, if you don't have its legal or not legal as your guiding standard, the only alternative is someone has to decide. And the implication of that not being a sufficient justification is that means a private executive is deciding.

• 1:16:24John Coogan?

  Yeah.

• 1:16:24Ben Thompson?

  And if AI is what it is, I think that's going to be, I use this word intolerable. I didn't mean intolerable to me. I meant intolerable to. Those with power to have a private executive making those decisions or not. And if you think about if power, if we're gonna have this very sort of brute analysis that power flows from or laws flow from power. AI is a source of power.

• 1:16:52John Coogan?

  Yeah.

• 1:16:53Ben Thompson?

  So it's not just that, and I think this is where the supply chain, again, which I'm not endorsing, but I think that's where the motivation is coming from. The goal isn't to find, we just won't use Anthropic. I do think the goal is to hurt Anthropic.

• 1:17:08John Coogan?

  Yeah.

• 1:17:08Ben Thompson?

  And you're, if you're not going to be subservient to us, you're not gonna be allowed to build a power base, period. And again, I'm not endorsing all this.

• 1:17:19John Coogan?

  Yeah.

• 1:17:19Ben Thompson?

  It's just a matter of, it's not a surprise, this is happening.

• 1:17:24John Coogan?

  Yeah.

• 1:17:24Ben Thompson?

  And it'd be, this needs to be just a, this is a real risk factor, a real, that has to be considered in all these decisions.

• 1:17:33John Coogan?

  Putting on my Dario hat, I'm thinking about a different way to achieve the goals with maybe less acrimony and I threw out this idea that maybe the better solution is like work with the government, but then lobby for a surveillance act and actually try and run a pack.

• 1:17:55Ben Thompson?

  I wish the White House would come out and say, yeah, there's a digital surveillance problem, let's work on a bit, like I, I don't, I, I.

• 1:18:00John Coogan?

  Yeah.

• 1:18:01Ben Thompson?

  Probably another regret I have is sort of putting this all on Anthropic. That was sort of the angle I was concerned about. I, and that left me, I think fairly open to the critique that this is just like defending the White House's approach. And that was, again, that was, I was trying to be a higher level that's saying, look, this is what's gonna happen. Um, but yeah, the, the.

• 1:18:21John Coogan?

  I'm just thinking from the perspective of like.

• 1:18:22Ben Thompson?

  Find a middle ground here.

• 1:18:24John Coogan?

  I'm just thinking of like, from the perspective of like, the, if the White House is like this immutable thing, and then you are in, you know, involved in Anthropic, like, like, one advice would be, hey, okay, instead of going in and having this confrontation with the government directly, uh, go and start a political action committee that lobbies for change in the way that you want through the democratic process.

• 1:18:48Ben Thompson?

  Yes, that is the ideal process. I understand why people are frustrated and skeptical about this. Okay. I used to have this debate a lot in the context of antitrust and aggregators. And one of my sort of theses about the aggregators and antitrust is that the antitrust laws are fundamentally unsuited to dealing with aggregators. Because antitrust law has historically been about control of supply, and the power of aggregators flows from control of demand. And so you end up with all these solutions that I call pushing on a string. You're just trying to get people to change how they behave, and that doesn't work very well. Like, Google has always been right. Competition has always been just a click away. The problem is, people aren't clicking. And like, so the solutions focused on the supply angle

• 1:19:33Ben Thompson?

  doesn't work in a world where the supply is there, just no one's choosing it. Yeah. And therefore, my prescription is, you actually need to pass new laws, not try to retrofit these old laws to this new use case where they don't work. And the reaction is always, "That's impossible. We can't pass new laws." And, okay, but realize the implications of what you're saying. I mean, I saw a tweet, again, I didn't like it, so I lost it forever. One of the most infuriating things in the world. But someone was like, "I would definitely rather have Dario Amadei make these decisions than..." And to this tweeter's credit, he wasn't limiting it to Trump. Because to me, this isn't a Trump issue. This is any politician issue. Yeah.

• 1:20:16Ben Thompson?

  He said, "I would rather have Amadei making these decisions than whoever comes out of our screwed-up democratic process." Yeah. And, points for the honesty, because that's the actual choice that is being put forward. And, you could say, "Congress isn't gonna do anything, therefore, Amadei should." Just appreciate that is giving up on the democratic process in saying, "We should have unelected, unaccountable individuals making weighty decisions." And again, I understand the sentiment. It's hard to imagine Congress passing laws about anything. Yeah. But, just realize that's like...

• 1:20:56Ben Thompson?

  That implication is quite fraught.

• 1:20:58John Coogan?

  Yeah, it's a huge change from, I mean, I just spawned in and believe in democracy and then understand it and study economics and and just have reinforced my belief in the American project throughout my entire career. And now it really is people discussing an entirely different world of governance, which is has been not something people have talked about publicly for a very long time, but it is here for sure.

• 1:21:23Ben Thompson?

  Right. And they always come in on these Trojan horses that are eminently defensible. Again, I'm with Anthropic on the digital surveillance point. I've been concerned about it for years, been writing about it for ages. And it's similar, it is an analogy to the monopoly, like you have all these laws that assume someone has to actually physically go somewhere and tap into a phone line. But if you can do it with computers at scale, like suddenly, you had all these assumptions that limited what the government could do that magically disappeared, not because the law changed, but because we got computers that could do the job of an individual at scale infinitely. And AI, again, is going to let the idea that

• 1:22:04Ben Thompson?

  the NSA, by the way, this is my sort of like, I had to admit this in the article, I was so confused why the Pentagon was so obsessed with domestic surveillance. I didn't realize the NSA was part of the Pentagon.

• 1:22:17Jordi Hays?

  John and I had the same moment.

• 1:22:19John Coogan?

  Yeah, yeah.

• 1:22:20Ben Thompson?

  Yeah, you're sort of thought about it as like an independent agency, like the CIA. But that made a lot of this story make more sense. Right, no, exactly.

• 1:22:27John Coogan?

  Yeah, I feel like a lot of tech people are like reading the Fourth Amendment today and understanding like some of these like pretty basic processes.

• 1:22:34Ben Thompson?

  Well, yeah, but like, it's pretty, the loopholes are massive. Like, I'm not denying it. Like, and it's similar to the chip thing with China. Like, my prescription for Anthropic to

• 1:22:48Ben Thompson?

  Give in is to allow these massive loopholes to be exploited and for the NSA to allegedly in the service of investigating foreign adversaries, but by, you know, the process, basically surveilling the domestic population, I think is bad. And the reality is, the nature of trade offs is you're choosing between multiple bad options. And at some point, it's like, which team are you signing up for? They both suck. Two of one.

• 1:23:25John Coogan?

  What do you think of the messaging around like the models themselves not being capable enough to be used in the context that the Department of War asked for? Because I felt like Dario was sort of speaking for all frontier labs. He said that like these technologies broadly are not suitable for these missions just yet. I'm not sure that he has all of the information on the other side to know about the efficacy. He certainly understands his models and what's capable on the frontier.

• 1:23:55Ben Thompson?

  I mean, I think that, yeah, I would, I mean, I would assume they're definitely not capable. That, I think that point is more of a precedent setting one. I think Anthropic's position is significantly weaker on that point. Like, at the end of the day, we either trust the military or not to make these sorts of decisions. That's why we have a military. And, and so I have a harder time. And I think the digital surveillance point is so compelling for them because I think it may be my personal biases.

• 1:24:27John Coogan?

  Totally.

• 1:24:28Ben Thompson?

  I think it's a huge problem.

• 1:24:29John Coogan?

  Yeah.

• 1:24:30Ben Thompson?

  The, this various anecdotes, again, I hate the reporting from these because you can tell like the leaks coming from which side for each of these.

• 1:24:38John Coogan?

  Yep.

• 1:24:39Ben Thompson?

  But, you know, this idea that putting forward these hypothetical examples of like, oh, you could call us and we'll figure it out then. It's like, no, come on. Like, are you serious about this? Like, like, so, yeah, I think that's a weak argument for them. So that's why I almost focused more on the digital surveillance one, just because I think it is a very compelling argument in favor of the Anthropic position.

• 1:24:58John Coogan?

  Mm hmm. Jordan, anything else?

• 1:25:01Jordi Hays?

  Oh, there's a lot more. What are you, what are you going to be tracking going forward? Obviously, the story's evolving.

• 1:25:07Ben Thompson?

  All my hate mail?

• 1:25:08John Coogan?

  Yeah. Good luck. Stay strong.

• 1:25:11Ben Thompson?

  No, I mean, I.

• 1:25:16Ben Thompson?

  The OpenAI angle is obviously interesting. I didn't really get into OpenAI.

• 1:25:22Ben Thompson?

  It's hard to parse exactly what's going on. It seems to me they have agreed to the Pentagon that they will be the Pentagon will be limited by lawful capabilities. And they make their own judgments about weapon usage. And as I understand it, OpenAI is like, we will on our side be free to stop the model from doing digital surveillance. Which sounds like you're in sort of a jailbreak competition. It's like, we're gonna agree to have a jailbreak competition with the US government. Which, I again, it's an example of how fraught this is, that that's probably the good place to come down on.

• 1:26:04Ben Thompson?

  Now, there's obviously these dynamics of competing for the same talent base. Being in San Francisco, you know, the, this is part of, I think Anthropic's Anthropic has a local advantage. In that, most people, I think, in the industry are with them. And they have a national PR problem in that I think a lot of folks outside of tech don't understand why tech companies always try to, or resist helping the US government. And so, it's kind of an interesting dynamic where I think OpenAI is in step with the broader public and very much out of step with sort of their talent base in San Francisco. And so that's gonna be very interesting to see how that plays out.

• 1:26:47John Coogan?

  Yeah. It's remarkable that Google has stayed out of the fray, given all the Project Maven background and stuff. Like, they must be so happy. They're just like

• 1:26:55Ben Thompson?

  Well, that's the other interesting thing is, uh, I, this is actually goes back to Google, I believe. Where Google had the Project, I think this is right. But I think Google had Project Maven, which their employees objected to. And therefore, that went to AWS. And then, some combination of, I think the Pentagon is using Anthropic because They're on the US.

• 1:27:20John Coogan?

  And the US has a higher, higher Fed ramp designation.

• 1:27:24Ben Thompson?

  That's right. And so, and so that's why Anthropic was already allowed for classified content and OpenAI wasn't. Again, I don't know the extent.

• 1:27:31John Coogan?

  It was, I, I, I've studied Maven pretty closely. It's a wild story. I mean, the, it was similar like AI for the military, the same like killer robot fears. The actual, I, I mean, Google was a subcontractor on that project. And what they were actually exposing to the, to the government was TensorFlow APIs that would run on Google hardware. And so they weren't actually writing any AI software, but they wanted to effectively like classify images from drones in the Middle East. See, that's a car, that's a house. And previously they had Air Force airmen just sitting there like clicking and they were like, okay, we're going to automate that. But, but it was still like scary, don't be evil, working with the

• 1:28:13John Coogan?

  government, military. And then there was a backlash, they pulled out, then eventually they went back in and had a new head of Google Cloud.

• 1:28:21Ben Thompson?

  Yeah, I mean, this, this is, you know, it's hard to, and I, I speak for myself personally. I obviously have the biased angle because of Taiwan. I have the biased angle where I think there, you know, just in general, there is this very naive view of the world that doesn't understand why militaries are important and necessary. And I think Silicon Valley got itself in a lot of trouble by giving into this naive mindset that we have no duty to support the military. And there's this tension's been, so it's a tension's been brewing for years.

• 1:28:52John Coogan?

  Yeah.

• 1:28:52Ben Thompson?

  Which is, are you an American company, subject to American law, and even beyond law, just morally compelled to support the US military?

• 1:29:04John Coogan?

  Yeah.

• 1:29:05Ben Thompson?

  Or not? And there's an equally American sort of idea of moral consciousness. I'm able to say no. That's why we have the First Amendment, right? This goes into the, can the government compel a company to do something? It goes back to some of the questions that happened, you know, with the first Trump administration. And, you know, I, I've been on both sides of this, like, which I.

• 1:29:27Jordi Hays?

  And this is what, this is what Daria said in the, in CBS interview. He said, we are a private company. We can choose to sell or not sell whatever we want. There are other providers. He's already sort of like making this case.

• 1:29:38John Coogan?

  Yeah.

• 1:29:39Ben Thompson?

  Which, again, is a case that I support.

• 1:29:43John Coogan?

  Yeah.

• 1:29:44Ben Thompson?

  But the point here is.

• 1:29:47Ben Thompson?

  There's always the question with like a bubble or whatever, is it different this time?

• 1:29:51John Coogan?

  Sure.

• 1:29:52Ben Thompson?

  And I guess that's sort of the question I'm raising.

• 1:29:53John Coogan?

  Yep.

• 1:29:54Ben Thompson?

  Is AI actually applicable to every other technology that's come along?

• 1:29:58John Coogan?

  Yeah.

• 1:29:59Ben Thompson?

  Or if it is the potential to be a source of power going forward, it's going to be dealt with as such?

• 1:30:06John Coogan?

  Yeah, that makes sense. Last question, we'll let you go. How happy should Ted Sarandos be right now?

• 1:30:13Ben Thompson?

  I mean, I think he had the killer quote the last couple of days where I think someone was asking him if this is such a jewel and it's so rare, like, isn't it a problem that you're missing out on it?

• 1:30:28John Coogan?

  Yeah.

• 1:30:29Ben Thompson?

  And he's like, well, have you seen the history of Time Warner? I think, sounds about right. I'm not sure how, the entity with all the debt that Paramount and Warner Brothers is going on. I think there's a bit where Netflix is always in the very long run been positioned, I think, to be the final buyer.

• 1:30:45John Coogan?

  Mm-hmm.

• 1:30:46Ben Thompson?

  Like, who else are content companies going to sell to?

• 1:30:48John Coogan?

  Yeah.

• 1:30:49Ben Thompson?

  I feel like they sort of, I feel like they've been spooked by YouTube a little bit and they felt a need to push forward.

• 1:30:55John Coogan?

  Yeah.

• 1:30:56Ben Thompson?

  On that, bring the, bring the future forward.

• 1:30:58John Coogan?

  Mm-hmm.

• 1:30:59Ben Thompson?

  That was not allowed to happen, but that means their original plan, I think, is still in place. So, probably, probably pretty happy, all things considered, I'm gonna say.

• 1:31:08John Coogan?

  It's great. Well, I'm, I'm excited to get back to Netflix coverage and, and more anodyne topics.

• 1:31:14Jordi Hays?

  Yeah, remember it was on Cheeky Pike, you were talking about getting sucked into the social media.

• 1:31:19Ben Thompson?

  I know.

• 1:31:20John Coogan?

  And here we are.

• 1:31:21Ben Thompson?

  So I put that quote at the beginning of my article, you know, you may not be interested in politics, it was politics that interested in you. That was about Anthropic and it was also about me.

• 1:31:29John Coogan?

  Yes, yes, yes.

• 1:31:30Ben Thompson?

  So, what did you do?

• 1:31:31John Coogan?

  Welcome, welcome to 2026. Well, we thank you for taking the time to come chat with us.

• 1:31:35Ben Thompson?

  Yeah, great to see you.

• 1:31:36John Coogan?

  And fantastic article. We appreciate you, Ben. Talk to you soon.

• 1:31:40Ben Thompson?

  Thank you. Have a great day.

• 1:31:41John Coogan?

  Let me tell you about Phantom Cash. Fund your wallet without exchanges or middlemen and spend with the Phantom card. And let me also tell you about CrowdStrike. Your business is AI. Their business is securing it. CrowdStrike secures AI and stops breaches. And our next guest is here, live in the TBPN Ultra Dome. We have James Beshara from Magic Mind coming on down for a very refreshing, very different pace of interview, hopefully.

• 1:32:08Speaker 06

  Great to meet you, John.

• 1:32:10John Coogan?

  Great to meet you. We actually met. I believe we met briefly in 2013.

• 1:32:18Speaker 06

  No way.

• 1:32:19John Coogan?

  Because we were using CrowdTilt at Soylent.

• 1:32:22Speaker 06

  Oh, well, then, yes, of course. Oh, actually, that was a hell of a meeting. We gave you all a huge, like, $800,000 check.

• 1:32:29John Coogan?

  They gave us a huge check, a physical check this big.

• 1:32:32Speaker 06

  Yeah, we printed it. Literally like an hour before, I was like, do whatever we need to do to get one of those kind of, you know, just TV checks. Because y'all had one of the biggest crowdfunding campaigns of all time at that point.

• 1:32:45John Coogan?

  Yeah, yeah.

• 1:32:45Speaker 06

  That's right.

• 1:32:46John Coogan?

  Remarkable.

• 1:32:46Speaker 06

  I was just chatting with Ajay from our team about Rob.

• 1:32:50John Coogan?

  He was the one that was the leader on the project.

• 1:32:52Speaker 06

  Yeah, that's right. Yesterday, yeah.

• 1:32:52John Coogan?

  And, yeah, that was such a wild thing. Because we had applied to get on Kickstarter. And at the time, they said, like, no food products, nothing but like board games, I guess, or whatever they were doing at the time. And you guys were like, we'll help you out, another YC company. You guys built it in like a weekend. And it worked flawlessly. Also, I found out, like, you guys were basically like, running digital ads for us and acting as our Facebook, like, promotion engine and everything was cycled back.

• 1:33:21Jordi Hays?

  That's still what the big crowdfunding platforms do.

• 1:33:22John Coogan?

  It was so helpful.

• 1:33:23Jordi Hays?

  They're actively marketing groups.

• 1:33:25John Coogan?

  We just didn't have any marketing skills or any real, like, just, you know, we were so busy with other things, that if we hadn't, if you guys hadn't done that, we probably would have ended that campaign like way lower.

• 1:33:36Speaker 06

  We took, I still do take customer obsession to the extremes. And yeah, we saw it. It was like, hey, well, this helps both sides. We should lean into it. But yeah, the in for... For listeners, for viewers, Soylent was, I mean, that was so game changer. The whole internet was talking about y'all for weeks.

• 1:33:56John Coogan?

  Super viral.

• 1:33:56Speaker 06

  And, uh, and it was, um, for Y Combinator, and by the way, both of y'all, and I'm, I don't know if, if someone's just tuning in, you know, three months ago, and then they are like, "Hey, these are, it's just the best hair on the internet, and that's why I tune in." These guys are journeymen in tech, and don't, it's so cool to listen to y'all, because it's not a journalist that doesn't know how to actually build, or what goes into, uh, creating a, a company, a startup, or sees a trend from a journalistic point of view, but you guys.

• 1:34:29John Coogan?

  Many a skinny in the arena.

• 1:34:30Speaker 06

  The founder perspective. Which is why I'm bringing y'all gifts.

• 1:34:34John Coogan?

  What are you bringing?

• 1:34:35Speaker 06

  A S-ton of Magic Mind for y'all.

• 1:34:38Jordi Hays?

  Let's do it, let's do it.

• 1:34:39Speaker 06

  And as soon as I saw, as soon as I saw, yeah, we should do some shots, as soon as I saw, I think it was on a Sam Altman interview.

• 1:34:47John Coogan?

  Yeah.

• 1:34:48Speaker 06

  That Jordy was doing, and he was chugging a Magic Mind.

• 1:34:50John Coogan?

  Oh, yeah?

• 1:34:51Jordi Hays?

  I'm going for a max.

• 1:34:53John Coogan?

  Oh, yeah.

• 1:34:54Speaker 06

  Let's, let's Magic Mind max it today.

• 1:34:58John Coogan?

  I love it. So, uh, yeah, yeah, explain, explain what this is, what are we consuming?

• 1:35:02Speaker 06

  Yeah, the, I'll get the, the 10-second, uh, commercial out of the way, but you just shake it.

• 1:35:06John Coogan?

  Peptides and amphetamines?

• 1:35:07Speaker 06

  Yeah, exactly. Peptides, amphetamines, amphetamines and steroids, uh, all in one, but you shake it, slam it back, Jordy's the king of the slams.

• 1:35:14John Coogan?

  Delicious. Mental performance spot. Oh, it has some caffeine in there.

• 1:35:18Speaker 06

  And it does, so Max is unique.

• 1:35:20Jordi Hays?

  In some of them, in some of them.

• 1:35:21Speaker 06

  Yeah, Max is unique in that it is the world's first time-release energy, energy shot. So, the, uh, you couldn't do time-release in liquid form until about two years ago, and we were the first to put in a shot.

• 1:35:32Jordi Hays?

  What did you learn from building software that you applied to CPG?

• 1:35:36Speaker 06

  Oh, my God.

• 1:35:37Jordi Hays?

  Because I think, like, right away, my experience as a customer has been this, like, iterative approach, basically versioning out, like, the product. When you released it versus two years later was like night and day.

• 1:35:50Speaker 06

  Night and day.

• 1:35:51Jordi Hays?

  In my experience, like just a much better product, which is something that unfortunately, I think a lot of CPG brands, they kind of like make their product, they ship it, they get it into as many stores as they can, they sell as much, and maybe they don't even iterate that much in the product, which puts you at, which is just like extremely high risk from my view, but that's sort of the step.

• 1:36:10Speaker 06

  It is, it's a really high stakes experiment when you start shipping it to stores and you get into a thousand doors and then you realize, hey, this is kind of a B plus product, we could make it better. And yeah, we've chatted about this over the years, basically since the beginning of Magic Mind of taking, excuse me, everything that I could from Silicon Valley and my background was in building software into building a dream company, which meant the first three and a half, four years was just improving, probably 150 iterations of making the product better, better, better before we went into stores. Because when you are D to C, and it is, it is, every time I say this out loud, I can't believe it's the case, but as the first D to C energy shot, like it was, I couldn't believe no one

• 1:36:55Speaker 06

  had done it before, but one of the huge affordances is you can have version one, version 1.1, version 1.5. And each time that we made the product better, we saw the retention curve go up, up, up, and then we're like, all right, this thing's ready for retail. And now, as of last month, it's the number one health shot in the country in the natural channel.

• 1:37:14Jordi Hays?

  That's wild. Yeah, I remember when I first tried it, I was like, okay, I like what this gives me, but it hurt my stomach. And then you were like, try it again. I tried it again, fixed it. And so I think that.

• 1:37:24Speaker 06

  Oh, God bless the early testers. It was rough early on. And it was like, hey, I'll eat nails if it'll help my productivity focus and flow. But it turns out most people wouldn't. And yeah, it was, actually Biz Stone, huge shout out to Biz Stone, co-founder of Twitter. He's the one that put us in touch with. My college. Yeah. Oh, really? No way? What college y'all go to? Northeastern. Oh, no way? Yeah. So brilliant mind investor. He's the one who put us in touch with these oncology manufacturers, this oncology manufacturing company. This is the most over researched beverage. And the planet. So we worked with them and utilize this technology to make everything so small that you can make it taste better than any of these ingredients have ever tasted before.

• 1:38:07Speaker 06

  So my favorite ingredients called Bacopa Bacopa maneri decreases impulsivity by up to 50% which is amazing for focus flow.

• 1:38:15John Coogan?

  If you want to be risk on.

• 1:38:16Speaker 06

  That's right. Yeah, exactly. If you if you want it.

• 1:38:18John Coogan?

  On the track. I mean, performance takes many different times.

• 1:38:21Speaker 06

  Your advertisers don't want it for all of the logos that are happening right here, right all over here.

• 1:38:26John Coogan?

  I was skiing. I saw a guy do a backflip on skis with no helmet.

• 1:38:30Speaker 06

  That's impulsivity in a beautiful way.

• 1:38:32Jordi Hays?

  It was not on Magic Mind.

• 1:38:34John Coogan?

  He needs a magic mind to put on the helmet because that is actually extremely dangerous. Do not recommend doing a backflip up on skis with no helmet.

• 1:38:40Speaker 06

  That's a, that's a, a non-magic mind move.

• 1:38:43John Coogan?

  For many people.

• 1:38:44Speaker 06

  Many people, when you don't want to jump into social media or the 50 texts on your phone.

• 1:38:48John Coogan?

  Actually focus. Yeah, exactly. Yeah, you want to be less impulsive.

• 1:38:51Speaker 06

  But it tastes terrible until we found this technology.

• 1:38:54Jordi Hays?

  So you took, you took the iterative approach, the R and D actually brought this kind of like hardcore R and D to a category that many people would have just again shipped a project and been like, it's good for me. Let's run it. Uh, what did you not take? What did you not take?

• 1:39:10Speaker 06

  That's a great, great question.

• 1:39:12Jordi Hays?

  So much of the way that you run the company is, is incredibly, uh, unique and kind of at odds with maybe how you built your last company.

• 1:39:20Speaker 06

  Uh, there are a handful of things and this is one of my favorite things to talk about is just how we build the company, um, and Magic Mind and it's, you know, that, that, there's that, uh, line in literature of once you know the rules and you can break the rules. And so I think my twenties of three different startups and a lot of it just failure to failure to failure, but learning how other companies did it or the playbook would be done and then recognizing getting to a place and honestly just being able to fund it with my own capital. I was like, I'm going to do this my own way. So one of the things is we don't have any junior employees. Um, about 10 senior employees. Everybody's senior. We have plenty of great contractors, plenty of great agencies that we work with, but because of that, one of the things that we do is no meetings. Um, it is all asynchronous.

• 1:40:05Speaker 06

  Every once a month, we have a team meeting and people can, if you need it, uh, you need to go to a meeting, go for it, but the default is asynchronous. Love, we love loom, uh, emails, texts instead of Slack. We don't, I hate Slack. Um, A, uh, the voice notes, but.

• 1:40:23Speaker 06

  This senior aspect of the team members, no junior team members means that the investment is very expensive per employee. But man, it's like a hot knife through butter whenever there's a challenge. You have senior people through and through on every aspect of the business. And I think with my earlier startups and with most startups, a lot of times you're hiring people that are doing something for the first time and saying, hey, we need you to, I know you've been a great engineer, we need you to PM as well for this thing. Cause there's three or four of us with Magic Mind, it was like, no, I want someone that's done this two, three times before and is a veteran that knows how to do this.

• 1:41:01John Coogan?

  It's super key in retail.

• 1:41:04Speaker 06

  Yeah, exactly.

• 1:41:05John Coogan?

  Because like it's just, it's so hard to go on the phone with a buyer and actually build the trust. If you haven't already sold them the last, oh, you were at the last company, you were the one that brought in vitamin water to Costco. So the Costco buyer loves you because you brought him a banger product. You're going to try the next thing. Much harder to just take a cold call and break through.

• 1:41:23Speaker 06

  And I'm sure you noticed it with Soylent. In fact, what are some of the things that you remember from the retail, the first stages of the retail?

• 1:41:31John Coogan?

  Retail was a nightmare.

• 1:41:32Speaker 06

  Tell us, yeah, tell me more.

• 1:41:33John Coogan?

  It's been a lot better with Lucy, but yeah, very, very driven by trade shows, relationships, just being in some massive conference room, getting to know people over years and years and years and building trust. And then the only thing that can really accelerate is that example of like bringing in someone who has a relationship on the other side where they delivered the goods and then they are putting their, their reputation at stake, saying, the last time I was with a smaller company, you took a risk on me. You were successful. We both made money because this product, you bought a bunch of it, you took your limited shelf space and you gave it to my previous company and it moved and you made money and you looked good, you got that promotion, now you're VP. Do that, take that risk again with this next thing.

• 1:42:18John Coogan?

  That's always been the best.

• 1:42:19Speaker 06

  Take the risk and then also do it in the right sequential way to where you don't, I think one of the things, one of the biggest cardinal sins in retail, and I didn't realize this coming from software, you actually don't want to move fast and break things. If you get into, let's say you get what seems like a dream partner in Walmart. If you don't move, if the product doesn't move, and I didn't realize this until getting into retail, and my co-founder Williams is a genius on this stuff of just avoiding what makes you good. I said, we say this internally a lot, what makes you good is what you do, what makes you great is what you don't do. One of the things that the trap that is a doom loop in retail is you expand too fast. Let's say you get Walmart, you're like, hell yeah, we got Walmart. This is the 800 pound gorilla, and then it doesn't move. And then you have to start putting in.

• 1:43:04Jordi Hays?

  It's not like Facebook, you launch an ad on Facebook, it doesn't work, you just wind it down.

• 1:43:08Speaker 06

  No, now it's like Walmart's like, hey, by the way, if you want to stay in here, and you got one bite of the apple, over the next 90 days, you've got to spend 400K in spend, in promotional spend, you're like, 400, I didn't, we didn't expect, we had 270 grand in the bank. You all aren't going to pay us for six months because of the payment terms you negotiate. And they're like, well, then we're going to have to take you off the shelves. So then you go and raise some last ditch effort round. That goes towards, you don't get quite to the 400, you only get like 300, and then it starts this slow doom loop. And then you can't take it off the shelves because the worst graph in the world isn't flat. It's one that goes up and then down, your revenue is flatlining or going down, and you can't raise any investment.

• 1:43:51Speaker 06

  And I would say conservatively, I'd say three out of four CPG brands get into that trap because they expand too fast.

• 1:44:00John Coogan?

  Everyone starts D to C. The retail transition is the make or break moment for like every new brand, basically, in my opinion. And the hardest part is always for me rethinking the CAC to LTV math. Like, it's pretty easy on e-commerce to think about payback period. Maybe you're not doing ROAS, maybe you're doing LTV to CAC, but you're still looking at like a one-year payback. And when you get into retail, you're looking at much bigger tickets. It's not 100 bucks on an ad, it's 100,000 dollars or a million dollars of commitment with some chain. And then you might not see ROI on that because your margins are lower. You might not see ROI on that.

• 1:44:40Speaker 06

  And you're distracted from the customer, so you don't really know, what are they responding to? What messaging are they responding to? There's a. This goes back to the two obsessions that that I have are on the product.

• 1:44:51John Coogan?

  Yep.

• 1:44:52Speaker 06

  Everything in the product, every ingredient, third-party tested.

• 1:44:54John Coogan?

  Yep.

• 1:44:55Speaker 06

  Everything's clinically backed, the exact dosage on the product. And then in that customer experience, and then the other obsession is on the communication. And one of the things that you can do in D to C that you can't do in retail is you can iterate like crazy on the exact, every word on here.

• 1:45:10John Coogan?

  Yeah.

• 1:45:10Speaker 06

  Has been tested with.

• 1:45:11John Coogan?

  Yeah, of course.

• 1:45:12Speaker 06

  Millions of eyeballs. You go into retail without that that layer, or you go in too early and it's a suboptimal message.

• 1:45:19John Coogan?

  People just have it, though, and they can just, they can just like one-shot everything and then just go straight to retail. But it is very rare, and usually they have a retail background.

• 1:45:27Speaker 06

  Yes, they have a retail background.

• 1:45:29John Coogan?

  Yeah.

• 1:45:29Speaker 06

  And and one of the things that.

• 1:45:31John Coogan?

  Survivorship bias.

• 1:45:32Speaker 06

  Yeah, they got really lucky, perhaps.

• 1:45:34John Coogan?

  Started some company where like their whole shtick was like, the packaging is going to be gold. And it's just going to like jump off the shelf at you and like it did and they sold the company for like a couple hundred million bucks. David is. Oh, David's kind of doing that now, but I was thinking something like 10 years.

• 1:45:47Speaker 06

  But a total veteran, David's a perfect example where it's like every move is from.

• 1:45:50John Coogan?

  What do you think about pricing? I always think of, was it Koya that was like $12 a bottle or something? And they sold for great outcome and it just flew off the shelves. And it was almost like a Veblen good, like a Lamborghini or a Rolex or something where the higher the price, people saw the higher price and they immediately thought like, this is a better product, so I'll buy it. And that actually drove sales as opposed to duking it out for, oh, well, we're the same price as the Red Bull. So people will comp us to that versus like, no, the price tag is marketing. What do you think about that?

• 1:46:23Speaker 06

  That is, it's, there's so, there's so much discussion around that on an investor and a handful of of CBG companies that you can get caught into a lot of just like triangulation and you end up with, it's like, you know, you Homeland-style like triangulation with the red string. They will do this in these stores and this in these stores.

• 1:46:45John Coogan?

  Yeah.

• 1:46:45Speaker 06

  I will say Air One sometimes gets into like $8 shots of Magic Mine, which we're not fans of. But it is the number one shot there, so it is working. So maybe it's a, it's, it could be. Maybe they've got a secret to it, but there is a really simple framework that we use, which is I wanted it to be the best hell shot in the world. Yeah. So in terms of everything from the vitamins for D and C and all of the B complex for immunity, because nothing will sap your productivity like getting sick, all the way to the Bacopa, uh, citicoline, one of the things that caffeine does is it's a vasconstrictor. So it will restrict the blood flow to the brain, which is terrible for lateral thinking and terrible for switching contexts.

• 1:47:28Speaker 06

  It's not great for a conversation when you're like, oh, I really want to absorb that new information, but it is great for alertness. But if you add in something like citicoline specifically is this supplier we have Cognizant, which took, it was like a two-year wait. Oh, yeah, that's really popular. Cognizant, it's amazing. So it's in Magic Mind and Cognizant improves blood flow to the brain. So that improves the, the academic term for creativity is lateral thinking, improves lateral thinking. All of these things are, you stack them up and they're pretty expensive. So I was like, I just don't care what the price is. I want it to be the best in the world and it's exactly what I had been taking for seven years before even thinking of making it into a product. Then we work backwards and we're like, all right, it's got to be this price. In the beginning, $5.99. Now it's down to about $3.99 because of scale.

• 1:48:12Speaker 06

  We, our batches are about 2 million, like we're producing about 2 million bottles a month. So now with scale, you can get the price way down, but it was, man, John, it was a friggin', it was a pushing a boulder uphill to get people to be comfortable with that price point in the beginning, but I was like, nope, that's what the price is going to be.

• 1:48:30Jordi Hays?

  What's your relationship like with the internet?

• 1:48:34Speaker 06

  Personally, dude, we duke it out daily.

• 1:48:40Jordi Hays?

  No, no, I just like, I, I'm no specifically like walk, like walk me through the last three days of your internet usage.

• 1:48:49Speaker 06

  Oh, great question.

• 1:48:50Jordi Hays?

  Because like I want to, I'm trying to gauge how online you are because I feel like. The, the internet is just a, a stress machine.

• 1:48:58Speaker 06

  Dude.

• 1:48:58Jordi Hays?

  It feels like it works.

• 1:48:59Speaker 06

  This is my device.

• 1:49:00Jordi Hays?

  Oh, interesting.

• 1:49:01John Coogan?

  You don't carry a phone?

• 1:49:02Speaker 06

  Yeah, so this is a, a Monday. I have it right now because of the GPS to get here. And, um, and just, uh, being, you know, we, Jordy and I live a few blocks from each other. And, uh, and so I have the phone, but like literally I didn't charge it last night. It's 10% gonna die. Rarely use this thing. It is, yeah.

• 1:49:19John Coogan?

  Okay.

• 1:49:20Speaker 06

  And I rarely use this thing.

• 1:49:21John Coogan?

  Yeah.

• 1:49:21Speaker 06

  Um, the, my relationship with the internet is, uh, use it when necessary.

• 1:49:28John Coogan?

  Mm-hmm.

• 1:49:28Speaker 06

  And, and then don't use it any other time of the day or week. On the weekends specifically, we have three little girls and I go watch only and pay the extra whatever, like, uh, 14 bucks for it to have cell service. So that it's basically a dumb phone.

• 1:49:43Jordi Hays?

  Interesting.

• 1:49:44Speaker 06

  And I've got text and, and I've got, uh, phone calls on it, but outside of that, it is a dumb phone.

• 1:49:49Jordi Hays?

  You can't scroll.

• 1:49:50Speaker 06

  I can't scroll. And it's a, um, I've been, I create apps like with Replit to where I like creating an app that brings up quotes of, uh, the Bhagavad Gita and stuff like, that's the only thing. When I sit down on the toilet, I might read a little bit of Bhagavad Gita on my watch. And then I'm like, ready to rock. But I'm not where I was 10 years ago where it's like every

• 1:50:10John Coogan?

  Yeah, yeah.

• 1:50:10Speaker 06

  tiny little moment, let me jump into the amusement park that is my phone and then get lost

• 1:50:16John Coogan?

  Yeah.

• 1:50:16Speaker 06

  for 45 minutes. And it's a, uh, God's.

• 1:50:19John Coogan?

  Screen time's crazy.

• 1:50:20Speaker 06

  Yeah, I know.

• 1:50:21John Coogan?

  Scroll more.

• 1:50:22Speaker 06

  I will say, I will say, I listen to, without meetings, I can deliberately, and I love, uh, I will work from my iPad. Try to do 99% of my work from my iPad. A shout out to Replit there, cause I got a great iPad app. And, and there I will listen to y'all, like this morning, while I'm working out.

• 1:50:40John Coogan?

  That's great.

• 1:50:40Speaker 06

  Listening to y'all, uh, either on my, you know, the podcast app or on, uh, or on, uh, YouTube. But man, like, it's like the iPad is, I'm on, going into the offensive, I'm gonna actually create something.

• 1:50:53John Coogan?

  Mm-hmm.

• 1:50:53Speaker 06

  The watch is like, I'm gonna be on the defensive if my wife needs me, um, otherwise I'm with the kids. But this is this somewhere in between where I'm like, I can't really create with this phone. But man, do I get sucked into rabbit holes.

• 1:51:07Jordi Hays?

  Yeah, and you, and you, and you get into a situation where, you know, I've got. Thirty tabs open on my device, which is just like pure chaos.

• 1:51:16Speaker 06

  Right.

• 1:51:16Jordi Hays?

  And, and these devices is sort of like are, are just due to their nature, don't work very well to kind of multitask.

• 1:51:23Speaker 06

  The two things that I talk about so often with founders, as an investor in about a hundred startups and I talk to them all the time. Again, it's what makes you good is what you do. What makes you great is what you don't do. So deliberately for us, really mitigating meetings. Or I end up telling about the devices that I love and the number one is the Apple Watch as a, as a dumb phone. When you're at the gym, don't bring, you can, obviously, most people do bring the phones, but you might get sucked into an email. Certainly with kids, my goal with them is by the time they're 10, spend 20,000 hours with them. And, and that was scrolling when I was, I think I was listening to a podcast on my watch, actually.

• 1:52:06Speaker 06

  So no scrolling and this, this guest said that that was their goal. This is like a year and a half ago. I don't even remember the guest. Don't even remember anything about the other, the other points that they're making in the conversation, but that stuck with me. 20,000 hours before they're 10, because, and his logic was so sound. He said, he could make $50 trillion and never get that decade back with the little ones. And so I was like, man, I want to hit 20,000 hours with my kids. And that was basically the moment where I was like, the weekends, no phone. And I'm just going to be with them in those hours. So I'm going to be completely with them and not sucked in because I just know myself too well.

• 1:52:39John Coogan?

  I do the same thing. No phone, just Apple Vision Pro mostly.

• 1:52:44Speaker 06

  How is your?

• 1:52:45John Coogan?

  And I used, I vibe coded auto scroll, so I don't scroll. It's a scroll screen.

• 1:52:49Speaker 06

  Yeah.

• 1:52:50John Coogan?

  And it has all the Tik Tok and the Instagram reels and the X, moderating the situation.

• 1:52:54Speaker 06

  Dude, and your kids are virtually there with you.

• 1:52:56Jordi Hays?

  Exactly.

• 1:52:58John Coogan?

  I agree.

• 1:52:58Jordi Hays?

  How, how is your approach to angel investing evolved? Because I feel like angel investing can start out as like a fun hobby, a way to blow cash. But then you get caught up in this FOMO and, and there's, you're on other people's timelines. Like you're kind of fighting for allocation at different points. How, how, what's your approach?

• 1:53:17Speaker 06

  It's it used to be uh more is better and it was and it's true um so much of the game of investing is you go wide because the asymmetric returns one investment.

• 1:53:29Jordi Hays?

  You don't know who the next Gusto is.

• 1:53:31Speaker 06

  Exactly, and that was.

• 1:53:32John Coogan?

  Angel and Gusto?

• 1:53:33Speaker 06

  I was, yeah, that was my first angel check.

• 1:53:35John Coogan?

  It's sick.

• 1:53:36Speaker 06

  They're in our Bachelor Y Combinator. I know, it was nuts.

• 1:53:38John Coogan?

  That's amazing. Let me tell you about Gusto.

• 1:53:41Speaker 06

  Everybody.

• 1:53:41John Coogan?

  The unified platform for payroll benefits and HR built to evolve with modern, small and medium sized businesses. Go sign up.

• 1:53:49Speaker 06

  Wow, that has never happened before where I've been able to mention an angel investment and then.

• 1:53:54Jordi Hays?

  Get a live ad read.

• 1:53:55Speaker 06

  Live ad read.

• 1:53:55John Coogan?

  What's your website?

• 1:53:57Speaker 06

  Mine?

• 1:53:57John Coogan?

  Yeah.

• 1:53:58Speaker 06

  J J Beshara.

• 1:53:59John Coogan?

  Yeah, but the but the company, Magic Mine?

• 1:54:01Speaker 06

  Oh, Magic Mine dot com.

• 1:54:01John Coogan?

  Is that on Shopify?

• 1:54:02Speaker 06

  It is.

• 1:54:03John Coogan?

  That's amazing. 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.

• 1:54:11Jordi Hays?

  Anyways, continue.

• 1:54:12John Coogan?

  Continue.

• 1:54:13Speaker 06

  Shopify is great and as we get into the angel investing conversation, I bet a lot of ads will pop up because it is it has been, I've been fortunate enough to to invest in a handful of great companies. But I went wide, honestly, Gusto did so well and and then a few others did really well. Mercury did really well and and and then I'll tell you my biggest miss.

• 1:54:35John Coogan?

  What's that?

• 1:54:36Speaker 06

  OpenAI and I'll tell you the story. It is fu- it is.

• 1:54:40John Coogan?

  Wow, that's.

• 1:54:41Speaker 06

  Can I curse on here? Total, total effing miss and and it was so brutal because so I, me and Sam.

• 1:54:50Jordi Hays?

  Oh, it's all good. There'll be another OpenAI in twenty years.

• 1:54:53Speaker 06

  Yeah, yeah, yeah.

• 1:54:54Jordi Hays?

  Yo, yo, you'll have another shot.

• 1:54:55John Coogan?

  It's way different than missing the just like a unicorn that comes up like you can find one in Y C.

• 1:54:59Jordi Hays?

  You're you're good. Another, another.

• 1:55:01Speaker 06

  It's I did the math the other day. It's basically missing twenty Googles.

• 1:55:07Speaker 06

  Google went public at a twenty billion dollar market cap. So it's missing twenty Googles now with their latest funding. It is straight up missing, it is missing thirty Googles. Yeah, thirty five, forty Googles. So, uh, which is cool. It's all right.

• 1:55:22John Coogan?

  It's fine.

• 1:55:22Speaker 06

  Um, I never calculated the amount.

• 1:55:24Jordi Hays?

  You needed to be humble.

• 1:55:26John Coogan?

  To clear your mind, low stress, I don't need to scroll.

• 1:55:29Speaker 06

  And it's, there's so many things that I will in life where I'm like, like the no meetings where I'm like, I know I'm leaving money on the table. I we couldn't, I couldn't imagine uh. Any other life, I I would feel very fortunate. Um, but I'll tell you the story, so. I've only shared this once, but it definitely replays in my head pretty often. So Sam Altman and I, we were advising and building out YC research for universal basic income. And this was in 2017. So every month, we would meet in a conference room in this dingy little office. And the dingy little office, the conference room, was where they were doing OpenAI research.

• 1:56:11Speaker 06

  So every month, and I was a full-time, we had sold my last company, Airbnb, I was a full-time angel investor. Yeah. Full-time angel investor. Waking up every day, thinking about, yeah, what are the next game-changing company? And I'm like, yeah, Sam and the team, they're trying to do this AI stuff and it's research and...

• 1:56:33Jordi Hays?

  That can be a problem when you're too close to an operation, whereas if you just get a pitch once, you're like, oh, this makes so much sense. But when you're getting all the information at all times and they're like, yeah, we don't really know what this thing's gonna be.

• 1:56:46Speaker 06

  Right.

• 1:56:47Jordi Hays?

  And we ran into this issue.

• 1:56:48Speaker 06

  Has that happened to you all with friends companies?

• 1:56:49Jordi Hays?

  Yeah, no, it's oftentimes you can... It sounds terrible. I ended up creating a rule of like, friends starts a company, like a real friend starts a company, just invest. Even no matter if you know like, oh, they've got this issue with how they operate, or they've got this blind spot, or you know all the problems that they're facing, you just, if you're too close to it, you can just overthink it.

• 1:57:10Speaker 06

  Dude, I told Ahmad at Mercury, when he was like, because we had built Financial Technology, and he is at the Airbnb cafeteria, and he told me the idea for Mercury, and wanting to start a bank for startups. And I was like, don't do it, dude. And I spent 45 minutes trying to convince him not to do it. And then like, two days later, he was like, I appreciate that, because we kept texting about it, he's, I appreciate the input, but I'm gonna do it. And I was like, well, okay, I'll invest. There you go. This is not a good idea. And good lord, was I a total idiot. But yeah, the OpenAI one, I was sitting every month saying no again and again and again. And even with the whispers of, yeah, well, I think we're gonna have to spin it out, make it a for-profit, and would you wanna invest? I was like, AI.

• 1:57:54Speaker 06

  And it's, I'll be honest, smart investors got in my head that were like, AI is so far off, that it's like, that's like a 2035 thing, we're so far off. And I was a total idiot. Well... Forty Googles later.

• 1:58:10John Coogan?

  Forty years later, with plenty of other opportunities, plenty of other investments, plenty of other products, and all the progress.

• 1:58:16Jordi Hays?

  It was good, it was good to be humbled a little bit. You're on too much of a hot streak, it's good to be like, okay, I gotta lock in.

• 1:58:24Speaker 06

  That is the benefit of building, I think, for anybody listening, I think it's what makes you guys so good at what you do, it's what I think makes any creator really good at what they do, is there are very few things, it's like going to the gym, you don't go to the gym for, you think you're going there for the gains, but man, what you really get is the ego dissolution, it is so, it's so humbling. And anytime you put yourself out there, you think you're doing it for the gains, but you fast forward 10 years later, and you're...

• 1:58:52John Coogan?

  It's the journey.

• 1:58:53Speaker 06

  Yeah, it's the journey, it's the ego, the humility that comes with it, that only comes with doing it, because man, if you're just number two or number 2,000 at a big company, you're just living in your head like, I would've done it this way, I would've done it that way, but man, it's, it is, by putting yourself out there, it's quite, it grows your awareness in a pretty, I'd say invaluable way.

• 1:59:16John Coogan?

  Well, it's a great journey.

• 1:59:18Jordi Hays?

  Well said.

• 1:59:19John Coogan?

  Thank you again.

• 1:59:20Jordi Hays?

  Thank you for the gift.

• 1:59:21John Coogan?

  For the oversized check, and thank you for the oversized delivery of Magic Mine.

• 1:59:24Speaker 06

  Thank you all for doing what you do in such a unique way.

• 1:59:27John Coogan?

  We appreciate you.

• 1:59:28Jordi Hays?

  Thank you for powering the show.

• 1:59:29Speaker 06

  Dude, thanks for making the show for us.

• 1:59:32John Coogan?

  Let me tell you about Gemini 3.1 Pro. Gemini 3.1 Pro is here 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. And let me also tell you about Restream, one livestream, 30+ destinations, if you want to multi-stream, go to Restream.com. And up next, we have John Quinn, live in the TVP in UltraDome for the second time. Thank you so much for making the trip down to our studio, welcome back. John Quinn, of course, is the most feared lawyer in America. We are huge fans. Tyler over there wears that hat every day. He is obsessed. You have a lot of fans.

• 2:00:14Speaker 07

  I got a couple for you, for you guys.

• 2:00:15John Coogan?

  And you know, I'm your neighbor. I live in Pasadena, right next, uh, very, very close to you.

• 2:00:20Speaker 07

  I know you went to school with one of my kids.

• 2:00:22John Coogan?

  I did, I did.

• 2:00:22Speaker 07

  Polytechnic.

• 2:00:23John Coogan?

  Yeah, yeah.

• 2:00:23Speaker 07

  I don't know which one. I had five who went there.

• 2:00:25John Coogan?

  Uh, I was in the same class as Jamie.

• 2:00:26Speaker 07

  Oh, okay.

• 2:00:27John Coogan?

  Yeah.

• 2:00:27Speaker 07

  Yeah.

• 2:00:28John Coogan?

  It was a great time. Anyway, uh, we're not here to talk about the minor life in Pasadena. We're here to talk about tariffs. We're here to talk about law. What have you been tracking? How have you been processing the, the back and forth on the tariffs this year?

• 2:00:41Speaker 07

  Well, uh, 10 days ago, the United States Supreme Court ruled that President Trump didn't have the legal authority to impose these tariffs, which were kind of the cornerstone of his international trade policy, domestic policy, maybe also, uh, provided a lot of funding. He's collected $600 billion worth of tariffs. He imposed those tariffs under something called the Economic Emergency Powers Act, uh, which gave him a lot of discretion under the administration's interpretation of it to, I mean, we saw this, you know, one day it was 35%, then it was 50%. It was all this. There were, there were two categories of tariffs. There were the fentanyl tariffs that affected some countries, Mexico, Canada, a couple of others. And then there were the liberation day tariffs, which was across the board, different deals

• 2:01:26Speaker 07

  for, for different countries. It had never, that statute had never been invoked before or used to impose tariffs. It was challenged in the Court of International Trade in New York. He lost there. Ended up going to the United States Supreme Court. The argument was a couple of months ago. Uh, the argument didn't go very well for the administration, reading the tea leaves. I think a lot of people thought the administration was going to lose. And then sure enough, the decision came out on February 20th. And the Supreme Court ruled that, you know, a lot of people thought the court would rule that these really weren't emergencies. The emergencies he was relying on were fentanyl and the balance of trade being an economic emergency. And a lot of people thought the court was going to say, you haven't shown that that's an emergency. But that's not what the court went off on.

• 2:02:11John Coogan?

  Oh, okay.

• 2:02:12Speaker 07

  The court ruled that he simply didn't, you couldn't impose tariffs under this statute. It had never been done before. There's no reference to tariffs or customs or anything, or taxes or anything like that.

• 2:02:22John Coogan?

  In the emergency economic powers.

• 2:02:24Speaker 07

  In the act.

• 2:02:25John Coogan?

  It's on it.

• 2:02:25Speaker 07

  And the court said, wrong statute.

• 2:02:27John Coogan?

  Yeah. And, and zooming out, where do tariffs typically come from? What's the correct path?

• 2:02:31Speaker 07

  Well, there's a, there's a number of different paths. There's section 122, which he's now invoked.

• 2:02:37John Coogan?

  Okay.

• 2:02:37Speaker 07

  Uh, there's a national security regime where you can impose tariffs, but it requires actually an investigation that's been done by, I think, the Department of Commerce or some other agency. So a record has to be created. The president can't just on his own say, you know, you're gonna pay thirty-five percent, you, India, you're gonna pay fifty percent.

• 2:02:55John Coogan?

  Yeah.

• 2:02:55Speaker 07

  So there is a whole other regime available, uh, and the day he lost, he, you know, he was ready for this. He announced, there's another statute that permits him, section 122, that permits him to impose up to fifteen percent tariffs for a hundred and fifty days.

• 2:03:11John Coogan?

  Yeah.

• 2:03:12Speaker 07

  After a hundred and fifty days.

• 2:03:13Jordi Hays?

  And then theoretically, you could just pause for a second and then start up again.

• 2:03:17John Coogan?

  Is that true?

• 2:03:18Speaker 07

  I don't think so. I think the courts would see through that, but after a hundred and fifty days, Congress has to act.

• 2:03:23John Coogan?

  Yeah.

• 2:03:24Jordi Hays?

  Hmm.

• 2:03:24Speaker 07

  So he can do it for a hundred and fifty days, and then to extend it, Congress has to act.

• 2:03:29John Coogan?

  And is that, is that passive in the sense that if Congress doesn't act, they don't continue? Or by doing that a hundred and fifty days, it forces a vote in Congress?

• 2:03:38Speaker 07

  I don't know that it forces a vote. I think Congress has to take affirmative action.

• 2:03:42John Coogan?

  They're the next one who have the, they know the authority.

• 2:03:45Speaker 07

  So the day, he was ready for this, the day he lost in the Supreme Court, he announced, okay, I'm invoking this section 122, ten percent tariffs on the world.

• 2:03:54John Coogan?

  Yep. And he could've gone up to fifteen.

• 2:03:55Speaker 07

  Well, he did it the next day. He says, I thought about it again, fifteen percent on the whole world. So that's where we are right now, but the clock's running.

• 2:04:04Jordi Hays?

  And what about, what about the Supreme Court didn't give any guidance on how the tariff, uh, the cash generated from the tariffs should be returned, right? So there's also kind of a gray area.

• 2:04:16Speaker 07

  They didn't, they didn't address that, but you know, honestly, guys, that's pretty straightforward. Uh, these six hundred and seventy billion in tariffs, there are, there are a lot of claims. Many, many companies have already filed claims, and there aren't a whole lot of defenses to those claims. I mean, he has said he's going to do everything he can essentially to delay it.

• 2:04:35John Coogan?

  Yep.

• 2:04:35Speaker 07

  You know, maybe so it's not on his watch, the next administration.

• 2:04:38John Coogan?

  Yeah.

• 2:04:39Speaker 07

  But there aren't a whole lot of defenses. These are, these are good claims. There's one issue about... In some instances, the costs have been, the tariffs have been passed on to consumers. So the government might presumably have a defense that, hey, wait a second, you don't get all this back.

• 2:04:52John Coogan?

  Your profits didn't go down.

• 2:04:53Speaker 07

  Yeah.

• 2:04:54John Coogan?

  There was no damage.

• 2:04:55Speaker 07

  You passed it on, so you saw the revenue anyway.

• 2:04:57John Coogan?

  Interesting.

• 2:04:58Speaker 07

  And that raises a question about whether the secondary parties, parties that paid for things that included these tariffs, which have now been ruled illegal, whether they can bring claims.

• 2:05:07John Coogan?

  Yeah.

• 2:05:07Speaker 07

  That's an interesting question. So I think, I think we're gonna see some of those claims as well.

• 2:05:11John Coogan?

  So for a company that's trying to get a big refund, maybe in the hundreds of millions of dollars, I imagine, for some of these companies, is the first step just to file a claim? Or do they need a lawyer? Is this gonna be a lawsuit on a per-company basis? How do you think that plays out?

• 2:05:25Speaker 07

  Yeah, I think it's, I think it's a lawsuit on a per-company basis.

• 2:05:28John Coogan?

  Wow, that's a lot of lawsuits.

• 2:05:29Speaker 07

  They have to file a claim.

• 2:05:31John Coogan?

  Okay.

• 2:05:31Speaker 07

  Lots of lawsuits, a lot have already been, we're filing lawsuits.

• 2:05:34John Coogan?

  Okay.

• 2:05:35Speaker 07

  I mean, one of our partners, a guy named Dennis Herenitsky,

• 2:05:38John Coogan?

  Okay.

• 2:05:39Speaker 07

  is representing a number of clients already and bringing these claims.

• 2:05:43John Coogan?

  Yeah.

• 2:05:43Speaker 07

  But what, what folks need to do if you wanna pursue, get your documents in order.

• 2:05:47John Coogan?

  Okay.

• 2:05:47Speaker 07

  Get your records in order.

• 2:05:48John Coogan?

  Yeah.

• 2:05:49Speaker 07

  Figure out what you paid when.

• 2:05:51John Coogan?

  Yeah.

• 2:05:52Speaker 07

  And yes, you probably need to engage a lawyer. I don't, I don't think you wanna do this on a, you know, representing yourself.

• 2:05:57Jordi Hays?

  Chat GPT, yeah.

• 2:05:58Speaker 07

  Yeah, exactly.

• 2:05:59Jordi Hays?

  Yeah.

• 2:05:59Speaker 07

  You don't want any hallucinations and what, and to screw up what is otherwise a powerful claim.

• 2:06:04John Coogan?

  Yeah.

• 2:06:04Speaker 07

  The claims are brought in a very obscure court known as the Court of International Trade. It's in New York.

• 2:06:10John Coogan?

  Okay.

• 2:06:11Speaker 07

  Uh, you bring the claim there and, you know, you pursue it.

• 2:06:15John Coogan?

  Yeah.

• 2:06:15Speaker 07

  The government has.

• 2:06:16Jordi Hays?

  What, what, how staffed up is that court? How could they possibly process what could end up being a mil-

• 2:06:24Speaker 07

  You know, it, it, it could be an administrative burden, but the issues are pretty simple here.

• 2:06:29John Coogan?

  Okay.

• 2:06:29Speaker 07

  I mean, it's, you know, he invoked this act.

• 2:06:32John Coogan?

  Yeah.

• 2:06:32Speaker 07

  Uh, they paid the tariffs.

• 2:06:34John Coogan?

  Yeah.

• 2:06:34Speaker 07

  The Supreme Court says he didn't have authority to do that.

• 2:06:37John Coogan?

  Yeah.

• 2:06:37Speaker 07

  And you know, the government refunds tariffs.

• 2:06:39John Coogan?

  Yeah.

• 2:06:40Speaker 07

  All the time.

• 2:06:40John Coogan?

  Yeah.

• 2:06:40Speaker 07

  It's, it's kind of a routine thing.

• 2:06:42John Coogan?

  Yeah.

• 2:06:42Speaker 07

  It's not like this hasn't happened before.

• 2:06:45John Coogan?

  Can you take me back to the Supreme Court battle and help me understand what's involved in fighting a case in front of the Supreme Court? How much do lawyers know about the positions of the various Supreme Court justices before they walk in the courtroom? How does all of this play out? What goes into a Supreme Court case? How, how high stakes is it?

• 2:07:07Speaker 07

  Oh, I, I think this was super high stakes. I mean, this was a, a- A major decision for this administration, maybe the biggest trade tariff decision ever. And I don't know that there was a lot of decisions by these justices before that could help people kind of predict what their reactions would be to this. The majority opinion was by Chief Justice Roberts. There was a dissent by Brett Kavanaugh and some others. But, you know, in preparing for it, I don't think it was unique to any other Supreme Court argument. Obviously, that's the biggest of the big leagues, so people prepare carefully for those arguments.

• 2:07:49John Coogan?

  How quickly, oh, sorry.

• 2:07:50Speaker 07

  Go for it.

• 2:07:51John Coogan?

  How quickly did the legal community come to a consensus around the impact and longevity of the tariffs? Because from our perspective, the market reacted violently on Liberation Day. It was the worst day in financial markets since COVID, effectively. But it feels like you've known or you've been able to predict that these tariffs might get struck down sooner than maybe most of the financial community. So what was the process like for the legal community to get consensus around what might happen at the Supreme Court level?

• 2:08:22Speaker 07

  I think it was pretty straightforward, especially after the oral argument before the Supreme Court. That went so poorly.

• 2:08:29John Coogan?

  Oh, interesting. So it wasn't that months ago, before even oral arguments started, people were looking at precedent and how the different justices-

• 2:08:37Speaker 07

  No, sure, sure, they were. I mean, you know, the administration had lost below in the court, so that, you know, people knew that this is definitely in play. So, I mean, I think the issues were pretty straightforward. I mean, does this act give him the authority? And as the Supreme Court found, there's no history for it. It had never been invoked before for this purpose. There's no reference to tariffs or customs in the act. So as legal questions go, you know, I don't think it's that complicated.

• 2:09:10John Coogan?

  Okay. How do you think about the speed, the time between Liberation Day and the Supreme Court ruling? That felt like almost a year. Is that deliberate by the administration? Is that just a function of how busy our Supreme Court is? Why does it take so long to actually get a decision from the Supreme Court?

• 2:09:28Speaker 07

  Well, some decisions take longer than that. Look, this, everybody, you know, the Supreme Court reads the newspapers, as somebody said during the FDR administration.

• 2:09:38John Coogan?

  Oh, that's funny.

• 2:09:39Speaker 07

  They read the tea leaves. They know how, and there's no doubt they knew how important this was.

• 2:09:44John Coogan?

  So they know what's coming even before a case.

• 2:09:47Speaker 07

  I'm sure they see it coming.

• 2:09:49John Coogan?

  Okay.

• 2:09:49Speaker 07

  But in terms of why it took so time between the oral argument and the rendering of the decision, it was, you know, people were waiting, wondering, but it wasn't an extraordinary amount of time.

• 2:10:00John Coogan?

  Yeah, yeah.

• 2:10:01Speaker 07

  But I think because of the known repercussions of this decision, the court wanted to be really, really careful and straightforward.

• 2:10:07John Coogan?

  Yeah. Are there any other big new trends in cases that you're tracking that might make it to the Supreme Court this year? I'm thinking particularly of some of the artificial intelligence debates that we're having. We were just talking to Ben Thompson about the relationship between Anthropic and the Department of War, and there's a lot of folks that are asking for clarity on the regulatory side, whether an act of Congress, or new laws, new leadership, more messaging, but the Supreme Court could play a role there. Is there anything that you're tracking in terms of like upcoming cases that will be particularly consequential for business or technology?

• 2:10:42Speaker 07

  Well, we all know about this issue, about using copyrighted materials.

• 2:10:46John Coogan?

  Yeah.

• 2:10:46Speaker 07

  To train large language models.

• 2:10:48John Coogan?

  Yeah.

• 2:10:48Speaker 07

  And we have cases pending, you know, relating to literary works.

• 2:10:52John Coogan?

  Yep.

• 2:10:52Speaker 07

  Visual works.

• 2:10:52John Coogan?

  Yep.

• 2:10:53Speaker 07

  Musical works.

• 2:10:54John Coogan?

  Yep.

• 2:10:55Speaker 07

  There are dozens of these cases.

• 2:10:56John Coogan?

  Yeah.

• 2:10:57Speaker 07

  Percolating their way through the courts.

• 2:10:58John Coogan?

  Yeah.

• 2:10:58Speaker 07

  There've been a couple of decisions up in San Francisco now, the early decisions at the district court level, the trial court level. Where the courts kind of came out, the decisions were kind of limited because of the unique circumstances of those cases. One was a Meda case, and I think the other was, I'm forgetting what the other case was, where they prevailed at the district court level. But before these cases can get to the Supreme Court, they have to go through that process.

• 2:11:24John Coogan?

  Yeah.

• 2:11:24Speaker 07

  A decision at the district court.

• 2:11:26John Coogan?

  Yep.

• 2:11:26Speaker 07

  Then you have a court of appeals.

• 2:11:28John Coogan?

  Yep.

• 2:11:28Speaker 07

  So, and then, and then to the US Supreme Court. I mean, it could well, you know, our Supreme Court doesn't hear very many cases.

• 2:11:35John Coogan?

  How many do they hear?

• 2:11:36Speaker 07

  I think they, I think they do like. I'm I think like around eighty cases a year.

• 2:11:41John Coogan?

  Oh, wow.

• 2:11:41Speaker 07

  You compare that like to India where they the Supreme Court there hears thousands of cases a year.

• 2:11:48John Coogan?

  Yeah.

• 2:11:49Speaker 07

  Of course, they have hundreds of judges on their Supreme Court, too.

• 2:11:52John Coogan?

  Yeah, yeah, yeah.

• 2:11:54Speaker 07

  But yeah, I I think there are definitely issues in the AI world that are could reach the Supreme Court.

• 2:12:00John Coogan?

  So walk me through the the thought process that if you were advising me and I believe that an AI lab has has trained on my intellectual property and that lab is well funded and they come to me with a settlement, why would I want to turn a settlement down and fight it out and take it all the way, go the distance all the way to the Supreme Court? Like, what what what are the different trade offs that that plaintiffs are making right now?

• 2:12:28Speaker 07

  You need to create a downside.

• 2:12:30John Coogan?

  Okay.

• 2:12:30Speaker 07

  For the AI company.

• 2:12:32John Coogan?

  Okay.

• 2:12:32Speaker 07

  You know, they've got to see that you have the staying power that you're prepared to litigate this case.

• 2:12:37John Coogan?

  Yeah.

• 2:12:38Speaker 07

  Anthropic.

• 2:12:38John Coogan?

  So you need so you need deep pockets. So if you're just a single, you know, author of a book, then you're not independently wealthy. They're probably going to say, hey, you'll take the settlement. But if you're a class of.

• 2:12:49Speaker 07

  Well, you know, it depends on what the what the settlement is.

• 2:12:52John Coogan?

  Sure.

• 2:12:52Speaker 07

  I guess.

• 2:12:52John Coogan?

  Yeah.

• 2:12:53Speaker 07

  But, you know, my experience is that defendants don't write checks until they see a downside.

• 2:12:58John Coogan?

  Got it.

• 2:12:59Speaker 07

  And so that involve you really have to kind of establish your credibility that we're serious about this. We're willing to pursue it.

• 2:13:06John Coogan?

  Mm hmm.

• 2:13:07Speaker 07

  Anthropic, you know, settled a case for a billion, maybe two billion, a copyright class action.

• 2:13:13John Coogan?

  Yeah.

• 2:13:14Speaker 07

  But those were, you know, very good lawyers who had put put together a case and they had gotten Anthropic in the position that they're facing whopping damages. If they lost at the trial court, it could have been much, much more.

• 2:13:26John Coogan?

  Much more.

• 2:13:27Speaker 07

  So that's the calculus. You kind of have to create a downside for.

• 2:13:30John Coogan?

  Yeah. And what what would the economic damage calculation be? Is that like I'd look at the profits that they've made from that or the revenues? Like, what sort of economic case should I be making if I'm trying to extract the maximum out of damages?

• 2:13:44Speaker 07

  Yeah, I mean, under the copyright laws, there are specific rules about what's recoverable.

• 2:13:48John Coogan?

  Sure.

• 2:13:49Speaker 07

  In a case of copyright infringement.

• 2:13:50John Coogan?

  Sure.

• 2:13:51Speaker 07

  And that's the theory here, that this is copyright infringement, use. Our copy, my copy, the plaintiff's copyrighted materials.

• 2:13:57John Coogan?

  Yep.

• 2:13:58Speaker 07

  In order to train the larger language model. And there's a couple of, there's statutory damages.

• 2:14:02John Coogan?

  Yeah.

• 2:14:02Speaker 07

  You know, which are a cer- fixed amount per infringement. Uh, or there are, there are theories under which you can recover the profits they, they got from it. But there are various rules about how damages are measured.

• 2:14:15John Coogan?

  Yeah, yeah, that makes a lot of sense. Jordy, sorry.

• 2:14:17Jordi Hays?

  Uh, give us a 101 on what it's like to, uh, uh, be in an active, uh, case or litigation with the, with the federal government. Uh, I'm sure over the many years we've talked, it's, is it, was it Palantir or Anduril that, that, uh, or both of them?

• 2:14:36John Coogan?

  Palantir and SpaceX both sued the US government over, uh, contracts that went, uh, that were not fairly bid in their minds. Uh, they didn't have a correct shot at displacing an existing program with the Palantir was D series.

• 2:14:52Jordi Hays?

  Yeah, but, but, but let's say you, you have a, a client that is considering taking, uh, an action against.

• 2:14:58John Coogan?

  Suing the government.

• 2:14:59Jordi Hays?

  Suing the government. What, how, how do you kind of like walk them through it? Obviously, there's a bunch of details, uh, case by case, but what's the general framework that you operate under?

• 2:15:09Speaker 07

  Look, the, um, there are good things and bad things about litigating with the government. We sue the United States government all the time. We had a, we had a case relating to, uh, Obamacare. There was something called risk corridors.

• 2:15:22John Coogan?

  Okay.

• 2:15:22Speaker 07

  Where insurers under Obamacare were assuming liabilities for markets that they had no history with. They didn't have a basis to underwrite it.

• 2:15:31John Coogan?

  Okay.

• 2:15:32Speaker 07

  And there was a term that was put in the Obamacare that said, okay, we will, we, the government.

• 2:15:36John Coogan?

  Yeah.

• 2:15:36Speaker 07

  Will backstop you, the insurance companies.

• 2:15:39John Coogan?

  Sure.

• 2:15:39Speaker 07

  So if you're, you know, if your losses are above a certain amount.

• 2:15:44John Coogan?

  Yep.

• 2:15:44Speaker 07

  You know, we'll fund that. Well, that was never funded and that was never paid.

• 2:15:49John Coogan?

  Basically, so the bill was coming due, the insurers were saying, hey, Mr. Government.

• 2:15:55Speaker 07

  Interestingly, the insurers, many of them weren't eager to sue, you know, stick their heads above the parapet.

• 2:16:01John Coogan?

  Yeah.

• 2:16:02Speaker 07

  And sue the United States government. But we got involved and we brought a class action on behalf of a number of insurers. It took some persuading to get insurers to participate. And ultimately, we recovered like seven and a half billion dollars. Now, the good thing about suing the US government is if you get a judgment, it's not like you have to go out and hire investigators and find the assets.

• 2:16:24John Coogan?

  Oh, sure.

• 2:16:25Speaker 07

  If you have a judgment, there's a window in Washington you can take your judgment to and they give you the money.

• 2:16:30John Coogan?

  You can get a check for seven and a half?

• 2:16:32Speaker 08

  Is it a drive-through, like a drive-through, like McDonald's?

• 2:16:35Speaker 07

  It wasn't that simple. They appealed and they lost. But once the dust was settled, yeah, they give you the check. We have a case now, I mean, we represent Harvard University.

• 2:16:47John Coogan?

  Sure.

• 2:16:48Speaker 07

  Versus the government. We sued Homeland Security on the ridiculous ban on, I thought it was ridiculous, on foreign students around, you know, coming to Harvard. So we sued Homeland Security on that. We sued Health and Human Services on the defunding and the cutting off of grants for research and things like that.

• 2:17:07John Coogan?

  Yeah.

• 2:17:08Speaker 07

  So both those cases, we won on the trial court level and it's up on appeal now. The government is appealing that. So litigating with the government, you've got to assume you know they're well-resourced. I mean, I don't know how many hundreds, probably thousands of lawyers there are in the Department of Justice. So they're going to show up, you know, they're going to advance the government's position and so they're not just going to lay down.

• 2:17:32John Coogan?

  Can you describe the level of sort of back and forth career paths that happened between Quinn Emanuel and the Department of Justice or the government? Are there folks that you're recruiting from the government occasionally? Are there folks that leave and go do a tour to understand what life is like on the other side? Or is it two sort of separate communities?

• 2:17:52Speaker 07

  No, it kind of goes both ways.

• 2:17:54John Coogan?

  It does.

• 2:17:55Speaker 07

  At our firm, we Have about twenty-five, thirty lawyers who one time or another were prosecutors, US attorneys, assistant US attorneys, or high-ranking officials in the Department of Justice. And that seemed for a youngish lawyer, a job as in the US Attorney's Office, as a good job, great experience. And those folks are in demand at firms like ours. And then, on another level, senior people, sometimes if they're interested in government service and they're connected, because a lot of this does involve political connections, you can get an appointment. We've had people in our firm who have appointments at very senior positions in the Department of Justice. So, it can go back and forth.

• 2:18:39Speaker 07

  I will say another thing right now, this Department of Justice is really busy. They're facing all kinds of cases. And, you know, based on what I hear and what I read, they're kind of resource-strapped. So, I'm not suggesting they're not going to show up and defend, but, I mean, like...

• 2:18:56John Coogan?

  Does that mean your associates are getting more calls to come over?

• 2:19:00Speaker 07

  You know, we've had a couple of associates go to work at the Department of Justice in the recent past. But that's always been true. It's a good experience.

• 2:19:11John Coogan?

  Yeah, yeah, that makes sense.

• 2:19:12Jordi Hays?

  How is, in your view, AI impacting the legal industry today? Not in the future, you know, what, you know, how will the impact kind of evolve over time? But what are you seeing and hearing from, you know, colleagues or friends at other firms?

• 2:19:30Speaker 07

  Look, we are wordsmiths, right? We work with words, we write things. And so, obviously, large language models are something that is going to change how we work. They may change the whole structure of law firms. Big law firms historically are kind of described as pyramid in structure. You have senior people, and then you have a lot of junior people. A lot of what the junior people have done in the past can now be done by large language models. It's not like they're gonna give you a work product that you can then file with the court and use. I mean, there are hundreds of cases where lawyers have gotten in trouble with courts by filing things that cite cases and laws that don't exist. So that is really, that's definitely a thing.

• 2:20:14Speaker 07

  Hallucinations, that's a huge risk factor, and that's, that's, that's really on the lawyer. I mean, there's no, there's no excuse for a lawyer to have said, oh, I relied on AI. No. You sign that thing, and that brief, you're responsible. It's your integrity on the line. So, uh, we're not, we're nowhere near getting, I don't think, at least in our practice. Maybe, we do complex litigation. There may be practices where it's a lot of repetitive litigation where, you know, you can get output that's, you know, ready for filing, but we're really not seeing that yet. But we're, we've developed in-house at our firm, a, a platform, a methodology for, uh,

• 2:20:57Speaker 07

  taking large masses of data that we work with, all the documents that are produced in discovery, all the testimony, all the contracts, and we organize, organize that on, it's built on the Claude Enterprise platform. And we've done this as lawyers. It's a system that's, it's proprietary, developed by lawyers for lawyers. I think if you just turn a young associate loose with Claude or Chat, ChatGPT, you're not optimizing the technology. But we take all the data and we structure it for a way that lawyers work. Sure. So it creates work streams. So, like, what do we need to do? We know what we do in every case. We prepare examination outlines. We prepare expert witness reports and the like.

• 2:21:42Speaker 07

  We prepare opening statements. So we structure in the data that creates these work streams. And, uh, I really think that's, that gives us a big advantage. That's, it's not something engineers have created. It's lawyers knowing what lawyers need, having designed a way to structure the information. And, you know, we're using that with great success. I mean, in trials now, in the middle of trial, imagine. Somebody's on the witness stand.

• 2:22:09John Coogan?

  Yeah.

• 2:22:09Speaker 07

  You can ask the AI, what's the best evidence that so and so just lied about that?

• 2:22:14John Coogan?

  Wow.

• 2:22:15Speaker 07

  You press a button.

• 2:22:16John Coogan?

  It just doesn't.

• 2:22:17Speaker 07

  And you get a button. So, and most of those things you will have thought of.

• 2:22:20John Coogan?

  Yeah.

• 2:22:20Speaker 07

  Some of them make no sense.

• 2:22:21John Coogan?

  Sure.

• 2:22:22Speaker 07

  But there'll be a couple of gems in there.

• 2:22:24John Coogan?

  Yeah, yeah.

• 2:22:24Jordi Hays?

  Yeah.

• 2:22:24Speaker 07

  You know, that you might not have thought of, lines of attack that you haven't thought of.

• 2:22:27John Coogan?

  That's great.

• 2:22:28Speaker 07

  That's extraordinarily powerful.

• 2:22:29John Coogan?

  Yeah.

• 2:22:30Speaker 07

  So what we are, our goal is to get to a point where the AI yields a work product that's like eighty percent or ninety percent there.

• 2:22:37John Coogan?

  Yeah.

• 2:22:37Jordi Hays?

  Which is what an associate is typically doing today, right? It's not, you're not, like, the best associate is not hitting it out of the park every single output. They're getting it, they're getting a good, good, solid chunk of the way there.

• 2:22:50Speaker 07

  You're absolutely there, right. And so lawyers can focus on what they do best. Making, making sure that last mile, the last twenty percent, the last ten percent is as good as it can possibly be.

• 2:23:01Jordi Hays?

  How do you, how do you think this affects the job market for lawyers at the early stage of their career? Because in some ways, yeah, their, their, their work might being, be, being replaced, but at the same time, given that, that AI is very good at generating words and can, will be able to generate entire lawsuits, you can kind of imagine a dystopian world where the number of, you know, cases that get brought are, are, you know, a hundred times higher than they are today.

• 2:23:35Speaker 07

  I think that's true, and that's something that's, people don't talk about a lot. There are AI companies, AI native companies out there that essentially identify claims. So they'll have a database that has information on businesses of all kinds. What licenses do they have? What licenses don't they have that they should have under the law? I mean, you can just imagine, if you can boil the ocean.

• 2:23:59John Coogan?

  Yeah.

• 2:23:59Speaker 07

  And, and they will, these companies, you can subscribe to them.

• 2:24:04John Coogan?

  Yeah.

• 2:24:05Speaker 07

  And they'll serve up. Here's a class action for your consideration. We've, we've identified the claim and, and here it is. So I actually think there's a potential that. We may see more litigation as a result of AI.

• 2:24:17John Coogan?

  Yeah.

• 2:24:17Speaker 07

  On the other hand, I think resolution of cases may be faster.

• 2:24:21John Coogan?

  Sure.

• 2:24:22Speaker 07

  Because both sides can understand quicker.

• 2:24:24John Coogan?

  Yep.

• 2:24:25Speaker 07

  You know, the merits of the case on each side.

• 2:24:27John Coogan?

  Yep.

• 2:24:28Speaker 07

  And reach a resolution sooner.

• 2:24:30John Coogan?

  Yeah, yeah, no, that makes a lot of sense. Um, last question from my side, can you tell me a little bit about how you perceive like the battle of the forms and the level of, the level of detail that contracts might be entered into? I'm thinking of this, uh, this news with Anthropic and the Department of War about the, these like two lines, domestic mass surveillance, fully autonomous weapons and there's, and there's like in every contract, there's a question of do, do you write it in one page or a hundred pages? And I think most lawyers can tell you, I can do either.

• 2:25:01Speaker 07

  Right.

• 2:25:01John Coogan?

  Uh, and they have different flavors and they have different subtext and it depends on the type of relationship that you're forming. And so I'm wondering how, how, how much you think about that when you're communicating in a legal context and something that's going to be binding. What level of legalese you want to use? What length of document you want to use? How important is that in?

• 2:25:25Speaker 07

  I think, I, I, I think it's super important. I mean, it doesn't matter.

• 2:25:28John Coogan?

  Yeah.

• 2:25:29Speaker 07

  Everybody, you close the deal, you have a closing dinner, people shake hands, they have a drink.

• 2:25:33John Coogan?

  Yep.

• 2:25:33Speaker 07

  And as long as things are going fine.

• 2:25:35John Coogan?

  Yep.

• 2:25:35Speaker 07

  Everything's fine, right? You never hear about it and the legalese doesn't matter.

• 2:25:38John Coogan?

  Sure.

• 2:25:39Speaker 07

  As soon as, you know, a couple of years down the road, uh, after an acquisition, joint venture, whatever, circumstances have changed.

• 2:25:47John Coogan?

  Yep.

• 2:25:47Speaker 07

  One side has a different goal. They want to go in a different direction.

• 2:25:51John Coogan?

  Yep.

• 2:25:51Speaker 07

  Can, and can they go in that direction?

• 2:25:53John Coogan?

  Yep.

• 2:25:53Speaker 07

  Or they're not performing, they faced headwinds. Uh, then, it's only then that people start to scrutinize the language and say, wait a second, can they? What did we actually agree to? Yeah. What, can they do this?

• 2:26:06John Coogan?

  Yeah.

• 2:26:06Speaker 07

  What are our options on both sides? If you want to get out of a deal or you want to create some leverage, you're going to scrutinize that language.

• 2:26:13John Coogan?

  Of course.

• 2:26:14Speaker 07

  And that's why. You know, we think it's a good idea, it's gonna sound totally self-promoting, but we have clients, major private, global private equity clients who ask us to do this, have, especially if it's a novel structure, that hasn't been tested before, something you haven't done before. Sure. Take a look at this and pressure test it for me from a legal risk perspective. Sure. You know, and I think it's especially valuable to have a litigator's eyes on the problem. Because, look, we live in a world where 24/7, something's gone wrong. Yeah. So, day in, day out, we're dealing with the very kinds of situations you're talking about.

• 2:26:56Speaker 07

  So, a lot of times, we can, you know, we look at these things with a jaundiced eye, and a lot of times, we can look around corners and see, how might a devious counterparty try to take advantage of this situation? So, I guess the answer to your question is, it doesn't matter until it does. Yeah. And so, because of our experience as litigators, we can look at things and kind of see, oh, there's a potential loophole here. Yeah. It might be a simple agreement. Yeah. Like, we had a case, an arbitration in Asia, I won't get into the specifics, because it's confidential. Sure. But basically, one side had an option, you know? Yeah. And there was a method for determining what the option price would be. Sure.

• 2:27:41Speaker 07

  And then it was kind of like, a bit like a baseball arbitration, and then one side got one number, and the other side would come with, and there'd be a neutral that figured it out. The other side quoted an option price was, was way out of bounds. Mm-hmm. It was like, totally unreasonable. Mm-hmm. And then they said, your turn. And what do you do in that situation? If you respond to that, treat it as a good faith offer, and you respond, then you've sort of bought in to that, going down that road. Yeah. And that seemed to be what the language of the contract on its face, you know, authorized. Allowed, exactly. And our advice was, no, don't respond. Yeah. Don't respond. Yeah. And so, they went to the arbitrators and said, look, they defaulted, they didn't

• 2:28:26Speaker 07

  respond, there's only one price on the table, and it's ours. Yeah. But ultimately, the decision, the arbitrators was no.

• 2:28:33John Coogan?

  Yeah.

• 2:28:33Speaker 07

  You know, you didn't act in good faith.

• 2:28:35John Coogan?

  Sure.

• 2:28:35Speaker 07

  Uh, so they lost and they're, they were stuck in that invest. Ultimately, they got out. They, they were so eager to get out of the investment. They had to come to terms with it.

• 2:28:44John Coogan?

  Yeah, makes a ton of sense. Well, thank you so much for taking the time to come chat with us.

• 2:28:48Speaker 07

  Thank you and thank you for the hat there.

• 2:28:50John Coogan?

  Enjoy the Quinn annual hat.

• 2:28:52Jordi Hays?

  Thank you for keeping us.

• 2:28:53Speaker 07

  I brought a couple more.

• 2:28:54John Coogan?

  And we will.

• 2:28:55Jordi Hays?

  Keeping us fitted.

• 2:28:55John Coogan?

  See you soon.

• 2:28:56Speaker 07

  Great to see you again.

• 2:28:57John Coogan?

  I'll see you around.

• 2:28:57Speaker 07

  Great to see you.

• 2:28:58John Coogan?

  Let me tell you about public.com investing for those who take it seriously. They got stocks, options, bonds, crypto, treasuries and more with great customer service. And let me 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. And without further ado, we will begin the Lambda Lightning round. Here we go. Pivot that camera over there. It's turning all the way around. It followed John Quinn out of the studio.

• 2:29:30Jordi Hays?

  I was missing him already.

• 2:29:32John Coogan?

  And now you see that the Lambda Lightning round has begun and we will.

• 2:29:34Jordi Hays?

  We got a banger to kick it off.

• 2:29:36John Coogan?

  An absolute banger. We have Michael from Work OS.

• 2:29:39Jordi Hays?

  There he is.

• 2:29:40John Coogan?

  Michael from Work OS, he is the co-founder and CEO.

• 2:29:44Jordi Hays?

  What's happening?

• 2:29:44John Coogan?

  How you doing?

• 2:29:45Speaker 08

  Gentlemen, great to see you. How's it going?

• 2:29:47John Coogan?

  Great to see you.

• 2:29:48Jordi Hays?

  Great to see you. It's been, uh, what has it been? A couple of months?

• 2:29:51John Coogan?

  It's been almost six months. Last time, uh, we had you on, we were hanging out with Sachin Adella on a historic day. Uh, also another crazy day to join, but, uh, since this is the first time joining remotely, uh, give us the update, kind of reintroduce yourself for everyone.

• 2:30:06Speaker 08

  Yeah, so I'm Michael Greenwich. I'm the founder and CEO of Work OS. And we are, uh, as infrastructure company that helps other software companies with enterprise features in their app. Not, not exactly the thing people get the most excited about, but it's the underlying infrastructure that allows people to sign into things like ChatGPT and Anthropic and Perplexity with their company account, with their enterprise account. So we often say that we help developers make their app enterprise ready. And today we're really thrilled to announce our Series C, which we've raised a hundred million dollars. All right.

• 2:30:39Jordi Hays?

  We got a mallet, we got a gong to hit. Let's see, let's see, do we have the power?

• 2:30:47Speaker 08

  It's like Thor reaching into me.

• 2:30:48Jordi Hays?

  There it is, there it is.

• 2:30:49Speaker 08

  There we go, look at that.

• 2:30:54Jordi Hays?

  Here we go.

• 2:30:57Jordi Hays?

  Hundred on two billion.

• 2:31:01Speaker 08

  That's right, that's right.

• 2:31:02Jordi Hays?

  That is some great dilution from your side.

• 2:31:06Speaker 08

  So WorkOS, we haven't raised money actually in over four years. I think a lot of folks kind of forgot about us, to be honest, as a company. We were started back in the beginning of 2019. So this is over seven years we've been building the company. Really, the news today, what's new with us, is the last year or two has been all about AI. And we have found ourselves supporting all these AI companies as they're rapidly, just explosively growing. So whether it's like OpenAI selling into the enterprise, or Claude, like, growing crazy over the last few months, or even Cursor last year, which, you know, kind of came out from nowhere and took over how people write software. WorkOS is powering all of these, and we're helping all of them take, you know, the functionality

• 2:31:49Speaker 08

  that they've landed in AI and actually enable them to go sell that into these big, you know, customers that otherwise they wouldn't be able to get, and essentially unlock revenue.

• 2:31:58Jordi Hays?

  So, so over the last few years, you joked that people forgot about you because you weren't raising. What, what were you doing? I'm assuming you were, you were at different points, probably turning, turning down investor interests, like, what, what was your kind of mindset in leading the team through that period?

• 2:32:16Speaker 08

  Yeah, we were just building. I mean, I think at the end of the day, to build infrastructure like we've created, there's no real shortcut for it. You just have to spend day after day, week after week, month after month, solving tens of thousands of small edge cases. Sometimes I say WorkOS, it's kind of like a ball of edges, like, the whole thing is made of edge cases. There's, there's not really just one way to, you know, quickly ship it. It's, it's in some ways like the anti-YC company. It's a thing you can't build in like a couple months and launch. It does take months and months and years and years to develop it. Early on, we had a lot of amazing customers. I mean, we, you know, early on powered off for folks like Vercel and Webflow and Carta, you know, kind of the, the previous era of, of cloud SaaS we all know about.

• 2:32:58Speaker 08

  It's just what we've seen with AI stuff is it, it grows faster. The companies are adopted sooner within the enterprise. And all this AI functionality, it's actually scrutinized by security IT people, you know, a lot more, a lot more heavily. Like, the IT people say, no way we can use your AI unless it fits these, you know, security policies. And so despite being started in the pre-AI era, WorkOS is actually kind of perfectly positioned to be in, we are in AI business today without having been started, started that way.

• 2:33:25Jordi Hays?

  Yeah, how have you, how have you processed the overall SaaS apocalypse narrative or just vibe coding in general? In many ways, WorkOS can, can kind of, I feel like, deliver kind of the dream of vibe coding, which is like, maybe there's some, some specific functionality you want to build. You want to be able to sell it into the enterprise. But pre-WorkOS, maybe that wasn't, that wouldn't have been possible because you have all these edge cases that, that enterprises are going to care about. But how have you processed the entire narrative?

• 2:33:59Speaker 08

  Yeah, when people are vibe coding stuff, you know, you typically don't want to vibe code your security part of your application. You might vibe code the features, the UI, like, like the AI code gen is so good for doing UI engineering. But when it comes to stuff like authentications or permissions or things around compliance or auditing, that's maybe not the place you want to apply AI. And we've seen that actually from a lot of our customers, including our customers being the AI labs that are building the models to do this stuff. They're even using, using WorkOS. What we've seen from a lot of other businesses is there's no time to build it in-house. So in the previous era, you might have had, you know, like a few years to figure out enterprise. If you go back and look at like Dropbox or something, you know, they built it for many, many years before they did enterprise.

• 2:34:42Speaker 08

  Today, what's happening is these AI companies, you know, powered by, by the functionality, they go after enterprise pretty much immediately. Like, within the first year, they have to go up market. And so there's no time to build it. They just turn to us and we ship it for them.

• 2:34:55John Coogan?

  So, so, I mean, truly, how low is the bar? Like, if I'm, if I'm in YC and I vibe code a piece of software that's like MVP, but it works, is WorkOS like accessible to the point where it's self-serve, free for, like, how, how low is the bar?

• 2:35:13Speaker 08

  Absolutely. So we have an amazing free tier. It's free up to 1 million users.

• 2:35:19Speaker 08

  So even maybe you get a million users when you're in Y C, but past that, you know, as you keep growing. What we charge for is the enterprise features and really we try to align our pricing model with you as a customer. As you go close enterprise deals, you pay work OS. It's it's kind of like Stripe, you know, you pay Stripe money when you go, you know, make money yourself, but it's so easy to use. We have people that integrate, you know, work OS in an hour or two. They're out there selling enterprise essentially as soon as they have demand.

• 2:35:44John Coogan?

  Yeah.

• 2:35:44Speaker 08

  And actually, just last month, we shipped a new capability that even faster to integrate because it uses AI. So AI is actually accelerating our customer base. It's also accelerating how fast you can adopt and use, use our functionality. You essentially just run a command, it installs work OS and then.

• 2:35:59John Coogan?

  Do you have like a KPI around that in terms of like integration timelines? Like it seems like they're getting shorter, but what are we talking about? Like days of developer time, weeks?

• 2:36:08Speaker 08

  If you run our CLI installer, which uses AI to install, it takes roughly seven to eight minutes. It's super fast and I've been doing this trick, uh, you know, whenever I do like a sales call with a with a customer that's interested in using work OS. Essentially kick off the call and say, hey, go try this, you know, just run it in your terminal in the background. We'll come back to it after I click around the dashboard a little bit and essentially you have a P O C that's ready to go. You know, in the past, we we would still integrate fast, you know, but we would have to talk to their engineering team. We get on the roadmap, we we do an architecture call, we have a amazing team of solutions engineers and developer success that helps plug stuff in. But I think what what we're finding is AI is this accelerant, not just in terms of market adoption, but just making

• 2:36:50Speaker 08

  software easier to use and integrate. We even have people that migrate using AI. So they might using a different solution or having a homegrown thing, you know, you plug Claude or Codex into it and just rip through it. It's it's really wild. Yeah.

• 2:37:02Jordi Hays?

  What now? Is the job finished?

• 2:37:05Speaker 08

  Job's not done. Absolutely not done. Uh, in in some ways, it's kind of like a new moment for the company. I I told our staff at the beginning of this year, you know, um, if I was to start work OS today. What I would essentially build is WorkOS for AI and specifically for AI agents. So that's what we're building going forward.

• 2:37:22John Coogan?

  Yeah.

• 2:37:22Speaker 08

  You know, if you think about agents in the world, and a lot of people talk about agents in different ways. Really what they're doing is displacing people doing work or enabling people to do more. You know, I think Ivan from Fennoshan has called agents that you're a manager of infinite minds. The ability to go and control and kind of adapt all these different systems to do work for you. The problem with agents is if you're spawning all these things, these workers to go do things for you. They essentially need permissions, they need access to data. And an agent isn't useful if you can't connect it to all your different stuff and you can't do that securely. Last thing you want is an agent, you know, running wild. I think there was a story on Twitter a week or two ago of an agent, an open claw instance going rogue and deleting a bunch of email.

• 2:38:03Jordi Hays?

  Yeah, it was Amazon. It was like Amazon also had a, I think.

• 2:38:07Speaker 08

  It was like head of alignment or something?

• 2:38:09John Coogan?

  Yeah. It was a really wild look.

• 2:38:12Speaker 08

  So, you know, you definitely don't want that for your personal account, but it's completely disastrous. If you're doing that internally to your systems or God forbid, it's doing it to your customers. And so this problem around what can agents do, they're extremely powerful. But we essentially need to give them different types of permissions and guardrails and identity on top of it. And so that's, that's a new thing that we've been building at WorkOS with some partners, building this new essentially identity fabric. That's what we're calling it, that sits across everything and allows people building agents to have the connectivity, but also the security and trust. That is demanded by their customers. And we hope with that, it will act as an accelerant more into the enterprise. It'll help more companies building AI do it in a way that's safe.

• 2:38:50John Coogan?

  Amazing. Last question for me. How is the role of, you said like integration engineer, it sounded like almost forward deployed engineer. How is that role changing at WorkOS now?

• 2:39:03Speaker 08

  Well, everything at WorkOS is using AI. Our customers are using AI, we're using it every single role. We have sales reps building stuff with Claude code.

• 2:39:09John Coogan?

  Sure.

• 2:39:10Speaker 08

  You know, our finance team doing stuff, we have hackathons going. And so it's definitely impacting the people that are working with customers every day in that way. I think the magic of Claude code and this forward deployed engineer is it essentially turns one person into a whole team. So it kind of mimics how. You know, if you go sell product to like a bank like Deutsche Bank, your giant company like Microsoft, you would be able to afford having like 10 or 15 engineers go sit in their office and write code, literally like post up with your laptop and like build stuff for them. That's the original, you know, solution engineer, forward deployed engineer. What AI lets people do today is essentially have that same experience, but have a tiny company do it. You know, like work OS. It essentially lets us be that level of consultative, you know,

• 2:39:53Speaker 08

  impactful work in your organization. The first step when we run our AI installer for customers, what it's actually doing behind the scenes is it's looking at your code base and building a plan. It's doing an architecture review by analyzing your structure and providing the best, you know, course of action going forward, the rest recommendation. And I think we're just scratching the surface on that. I mean, that's like, it's so early, it's so, so early in terms of all this. So at the end of the day, it just makes people, you know, integrate faster, go to market sooner, ship faster and just, just grow a market sooner. We, we talked about work OS being the help making your product enterprise ready. It's really an API that unlocks revenue. It expands your TAM as an organization. And when these companies go through that transition moment, say they just are getting product market fit and expanding,

• 2:40:39Speaker 08

  the last thing they want to be do is slowed down by the lack of these enterprise features when they have a big fish on the line. You know, and, and what work OS does, it turns that on almost immediately. So if it's a seven or eight minutes today, I'm hoping to take it down.

• 2:40:50Jordi Hays?

  The big fish company of San Francisco.

• 2:40:53Speaker 08

  That's right. That's right. Yeah. It's like a fishing line. It's like, we'll help you get it to go faster. Yeah.

• 2:40:57John Coogan?

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

• 2:40:59Jordi Hays?

  Awesome. Great. Great to get the update. Congratulations to the whole team.

• 2:41:02John Coogan?

  And we'll talk to you soon.

• 2:41:03Speaker 08

  Thanks again. Great to see you guys. Take care.

• 2:41:04John Coogan?

  Bye. 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. Our next guest is Adam Simon from IPG Media. He's in the restroom waiting room. Now he's in the TV. Adam, how are you doing?

• 2:41:23Speaker 09

  Oh.

• 2:41:24John Coogan?

  Hello.

• 2:41:24Speaker 09

  Sorry, guys, hold on.

• 2:41:25John Coogan?

  No, you're good.

• 2:41:26Speaker 09

  There we go.

• 2:41:27Jordi Hays?

  There you go. Well, it's happening. Great to meet you.

• 2:41:30John Coogan?

  Thanks so much for hopping on.

• 2:41:31Speaker 09

  It's great to meet you. Thanks for having me on.

• 2:41:33John Coogan?

  All right. Please introduce yourself. Give us a little background.

• 2:41:37Speaker 09

  Yeah, I am Adam Simon. I spent a decade as one of the top innovation executives at a global media agency, which basically means I got paid to be wrong about the future just a little bit less often than everyone else.

• 2:41:51Speaker 09

  And now I am out there consulting on where entertainment is going next, which in my opinion is off the screen and into the real world. And I'm working on a book called The Immersion Economy, about how immersive technology is set to supercharge the experience economy.

• 2:42:06Jordi Hays?

  Okay, what did you what did you get right when you were predicting the future?

• 2:42:10Speaker 09

  Oh, good question. I got right, I think, that Netflix would win in streaming, and I still maintain that after, you know, last Friday's news, obviously. I think that Netflix, you guys covered this earlier, but I think that Netflix is going to come out on top in this deal when we look back a few years from now. That was that was something I called early. I also called that they were going to pivot into having an ad-supported tier at some point, as well as into gaming. I think the Netflix behemoth will just keep growing.

• 2:42:39John Coogan?

  Yeah. Walk me through a little bit more of like immersive economy off the screen, like, that could mean Taylor Swift concert, that could mean Ice Cream Museum, there's a million things that happen off the screen, like, how do you just how do you describe like the territory?

• 2:42:55Speaker 09

  Yeah, I mean, it's it is all of those things. It is, in my mind, the exciting part is all of those experiences that are about to get are already getting upgraded or are about to get upgraded with technology. And some of that looks like immersive technology. It looks like the sphere. It looks like what what Cosm is doing, which I think is super interesting, especially around like sports and performances and stuff. But I also think it means AI personalization in the physical world. We're, you know, we spend a lot of time talking about how AI is impacting software. You guys certainly spend most of your days, I think, talking about that. But I think AI colliding with the real world robotics is the place that most people go, which is understandable. It's super exciting.

• 2:43:39Speaker 09

  But I think there's an interim step before we see robots everywhere, AI powered robots everywhere, which is just our physical world being a little more responsive to us as individuals. If you think about the physical world reacting to you in the same way that your your feed on social media might and starting to personalize itself in that way. That triggers some nightmare scenarios, but I think there's some opportunity to also do some really cool, fun, creative work there.

• 2:44:03Jordi Hays?

  Okay, so I'll give you a specific example. We were in Montana. We were in Montana this last weekend. We were at an ice race, which was the first event that they've done where basically they get a bunch of cars around an ice track. And then you can take cars out and do some laps and then there's a bunch of spectators and things like that. And I was, I was, you know, my, the event was incredible. My only criticism is like there was kind of one screen over in one of the spectator areas. And so in the area that that we were, you kind of, you were reliant 100% on your own vision to experience the event, which was cool, but at the same time, there were certain angles and like a bunch of missed context.

• 2:44:46Jordi Hays?

  And so in an event like, how are you thinking about personalization in the real world? Is it we have smart glasses on and you have your own audio feed? Or like, what does that actually look like in practice at something like an automotive event?

• 2:45:01Speaker 09

  Yeah, I mean, I think, I think that that is a great example. I think that to your point, we don't even need to wait for augmented reality glasses. I think when they do come, there'll be some really interesting, exciting things we could do. But just the ability to customize an audio feed, you could do that with AirPods right now, right? Like lots of people already have them in their pockets. We could be through people's smartphones, broadcasting customized audio feeds to you through your AirPods. Just as a one example, an under sort of discussed feature of the sphere that I find really interesting is they have beam forming speakers. So different sections of the sphere can technically be hearing different audio. They haven't really used this yet to. To my knowledge, but the way that they talk about it is that you could have like

• 2:45:46Speaker 09

  different language tracks, sort of beams to different sections of the venue. And I think that that's the kind of thing that we're seeing built in to lots of venues. And obviously, that's not a personalized sort of one to one experience. But you can also sort of see how that starts to move us closer in that direction and use some some technology that is, you know, not exactly new, but to to enhance the experience and make it more accessible for more people.

• 2:46:10Jordi Hays?

  How are you thinking about VR? We had Ben Thompson on our show earlier today. He's been pushing aggressively for Apple to just let him watch any NBA game. He basically figured out like it's like a $40,000, $40,000 worth of hardware that would just need to be installed at the different stadiums. And then you could just, he's like, I don't need, I don't need a separate live stream and commentary because if you just beam me into the stadium, I can hear the commentary that's happening. I can look up at the scoreboard. I really just need that kind of like video feed.

• 2:46:43Speaker 09

  Yeah, I mean, I think, you know, I, I think long term, there are some cases and some users who are going to want the more highly produced edited experience that Apple is is kind of leaning into. I know Ben is super against that. He just wants the the static camera. It's like, pretend that I'm there. But I think that he's right in that Apple's biggest problem right now is scale and just having the volume of content that you could get with just static cameras. And, you know, sports is is great, and I know I'm sure would sell a lot of headsets. But also just think about concerts and stage plays and any place else where just being a fly on the wall or being a butt in a seat, you can't get there or don't want to get

• 2:47:25Speaker 09

  there physically, but being able to get there with your Vision Pro or your Meta Quest or what have you. I think that there's real opportunity there. Longer term, I actually think that venues like Sphere and Cosm in particular are going to create a pipeline for that kind of immersive content that will be able to go straight to headsets. Because if you think about what Cosm is doing with the NBA, they basically have that camera already there, courtside. And it's creating that immersive sort of shared reality, is what they call it, experience in the Cosm venues. There's no reason you couldn't just port that over to a Vision Pro right now. So, we're starting to see some pieces be put in place that's going to create a really interesting, I think, flywheel for

• 2:48:06Speaker 09

  immersive content. And I sort of think about it as the venues like Cosm being a kind of middle-class experience, where if you have the money and the capability, you're going to go there in person, of course, but you're only going to do that for a few events a year, even if you have deep pockets. And, obviously, there's the at-home viewing experience, which might be upgraded if we can watch it in immersive environments. And then you have the option to go someplace like a Cosm venue, to get this sort of, you know, halfway experience. I can still go out with my friends and be social and have a close-to courtside experience without shelling out to fly wherever the game is.

• 2:48:45Jordi Hays?

  Yeah. Are there, are there a lot more Spheres, Cosm-type experiences coming down the pipeline? They said they're super-capital intensive, so they're high-risk, but are, from my view, the response to both has been great, and Sphere seems to be somehow doing pretty well in the public markets as of late?

• 2:49:08Speaker 09

  Yeah, I think Sphere was caught everybody by surprise a little bit, because that first year, there were, there were lots of headlines about how much money they were losing, how much it costs not just to build, but to operate. But from everything I can tell, they, from the outside, obviously, they look like they have found a path. I think if you look at what they're, they did with Wizard of Oz, which was a surprise, I think, to everyone in Hollywood, it, it is really successful. They basically made like a fan experience for Wizard of Oz, which gave them a reason to charge you over a hundred dollars a ticket to see a movie. That you've probably seen dozens of times before and I don't know if it's streaming anywhere for free, but it used to be on television all the time, right? It's it's like the classic movie that was was constantly available.

• 2:49:54Speaker 09

  And yet people are shelling out over a hundred dollars a ticket to go see it. They've sold over two million tickets to that already. So I think it's it's not exactly what they set out to do, but it's an interesting new path for them and clearly a source of revenue.

• 2:50:07Jordi Hays?

  Yeah.

• 2:50:10Jordi Hays?

  Brian Chesky from Airbnb was on the show fairly recently, talking about how he is quite bullish on on I R L in the age of A I, that the online world is getting very wild and intense. You can imagine some people just deciding I'm going to log off. I'm going to go get it, go somewhere, get away. I can see that, but I can also see the other side of it, which is that the online world continues to get more and more entertaining. And some people just say like, well, I'm not, I don't need to go take this trip or go to this experience because I'm perfectly entertained at home. What indicators are you looking at to understand if if A I is actually disrupting some I R L experiences?

• 2:50:54Jordi Hays?

  Would it show up as like Disneyland, you know, visits dropping, which obviously could be a number of factors? Like, how would you, where are you kind of like trying to see where there might be some disruption?

• 2:51:06Speaker 09

  Yeah, I mean, I think I would be looking at things like live streams, sports and concerts and things like that to see are the ticket sales going down? Everything we've seen to date is quite the opposite. People are spending like crazy on experiences, right? It's it's, everybody thought that that it was sort of a revenge spending after the pandemic, but that has has not played out. Everybody is very excited to at least sometimes, right? Like, close their laptops, put their phone in their pocket and go out and do something fun. I think what we're competing with is that people are, they want to be out there, having experiences, creating memories. And that is not something that you're going to have the same sort of experience doing, looking at a screen.

• 2:51:51Speaker 09

  There's also some interesting. Neurological research that I've been following around just like how we sort of sync up and experience communal events. And it's just, it's really fascinating. But basically, there's we, we create stronger memories and we form stronger social bonds when we're in person. And it actually has a biological component to it. It's not just sort of the emotional aspect of being there together. So I think, you know, maybe if the pandemic was the catalyst that we realized what we were missing. But I'm pretty bullish on the fact that demand for, you know, even technology optimized and oriented and enhanced experiences in

• 2:52:36Speaker 09

  the real world, like just because we're out in the real world, doesn't mean the tech goes away. It just changes and evolves. And I think that's where a lot of the exciting developments, both for AI, but also for for other technologies is going to be in the next decade.

• 2:52:49John Coogan?

  Well, we got to do the next one in person with a live audience because just neurologically, I feel like we'll have a better time.

• 2:52:56Jordi Hays?

  Yeah, there's also the the reality that many people are chasing IRL experiences to have something to show back on social media.

• 2:53:06John Coogan?

  Oh, yeah.

• 2:53:07Jordi Hays?

  In this, you know, I try to remind myself, you know, we were at this this car event and everywhere you looked, there were cars that if I saw them on the street, I would just stop whatever I was doing. And I was like trying to force myself to actually just like take it all in versus taking pictures. But certainly, there were some people that that hardly were processing it live because they just wanted to share everything that they were seeing.

• 2:53:32John Coogan?

  That's weird, too, yeah.

• 2:53:32Speaker 09

  Yeah, and honestly, that is the thing that I'm most excited about with with glasses, whether like Meta Ray-Bans or what Apple's going to release later this year or early next year. Having the ability to capture content, but stay more present in the moment, I think is the best sort of marketing case for those products. Because you're absolutely right, like we want to be able to capture these things. But we've, I think, tilted a little bit towards doing things just for the sake of capturing them rather than actually enjoying the experiences. And look, I think everybody knows that even when you're doing it, to your point, you you're aware of it. So I think if there's the right catalyst, it'll get people off their phones and more sort of focused on what's around them.

• 2:54:12Jordi Hays?

  Awesome. Totally.

• 2:54:12John Coogan?

  Well, thank you so much for taking

• 2:54:13Jordi Hays?

  Yeah, great to meet and come back on anytime.

• 2:54:17John Coogan?

  Have a good one. Awesome. Great to meet you. Thanks, guys. Let me tell you about Applovin. Profitable advertising made it easy with Axon.ai. Get access to over 1 billion daily active users and grow your business today. We have been keeping our next guest waiting. We have Matthias Wagner from Flux.ai. He's the founder and CEO and here's some exciting news for us.

• 2:54:36Jordi Hays?

  What's happening?

• 2:54:37John Coogan?

  Welcome to the show. How are you doing? Please introduce yourself and company.

• 2:54:41Speaker 10

  Hi, guys. Thanks for having me. My name is Matthias. I'm the founder and CEO of Flux. And you know, we're building the first AI hardware engineer.

• 2:54:46John Coogan?

  Amazing. And give us the news today. You raised some money. What happened?

• 2:54:50Speaker 10

  Yeah, we closed a Series B. We raised a total of $30 million in capital across.

• 2:55:03Speaker 10

  Led by ABC. So, you know, super stoked and, you know, stepping on the gas now.

• 2:55:08John Coogan?

  Yeah, talk about the key problem, the key, the key product, where you are in development, rolling out, getting product in the hands of customers.

• 2:55:17Speaker 10

  Yeah, good question. So, I mean, you know, you've all heard it before. Hardware is hard.

• 2:55:21John Coogan?

  Yeah.

• 2:55:21Speaker 10

  And we felt like this is like learned helplessness, you know? And we're taking the heart out of hardware. Right? So if you think here what.

• 2:55:30Jordi Hays?

  It's just wear now. It's just wear.

• 2:55:33Speaker 10

  Exactly. But, you know, we're starting with electronics here. Because, you know, it's like a very standard form factor. And it's really at the heart of anything that's worthwhile building these days. If you think about, you know, computers, robots, what have you.

• 2:55:47Speaker 10

  And the insight here really was like, right, that if you think about how easy it's become over the last two, three decades to make software, especially now with the AI boom, right? Hardware hasn't gotten any easier to make. Right? Even though the supply chain is incredible available now, and I can like from anywhere in the world, for like $20, can get a PCB box manufactured in China and sent back in seven days for the assembled, right? And that you couldn't do 20 years ago. You had to be Lockheed Martin or Apple or like a big tech company to afford it. But now we can do that. But the design tools just don't exist and are inaccessible. And that's what we're solving for.

• 2:56:22John Coogan?

  So talk about the inputs and the outputs. Obviously, at the end, I get some sort of PCB spec. Is that just a CAD file or a PDF? And then what am I actually putting in? Is it just software that then I want to be translated into hardware? Like, at what level of abstraction are we operating here?

• 2:56:37Speaker 10

  Yeah, good question. So look, the vision is that you can go, like if you think about chat GPT, you can go from like a prompt to a poem.

• 2:56:44John Coogan?

  Yep.

• 2:56:45Speaker 10

  Right? Or like Claude code, you can go from a prompt to a bug fix or a feature.

• 2:56:48John Coogan?

  Yep.

• 2:56:49Speaker 10

  With flux, right? Ultimately, we want to enable you to go from a prompt to an iPhone class device.

• 2:56:53John Coogan?

  Wow.

• 2:56:53Speaker 10

  But that's a long road, right?

• 2:56:55John Coogan?

  Yeah.

• 2:56:55Speaker 10

  Uh, so what about today is like you can make like, what's it like, mid, the smart to make complexity, you can probably single shot today. And everything else is gonna be more iterative, you know? Again, like Claude code, Devon, uh, cursor, all these tools, very, very comparable.

• 2:57:08John Coogan?

  Sure, that makes sense. Uh, who's the best customer for you right now? Where do you see that going? Are you going after startups that are iterating really quickly? This is speeding them up? Or are you going to large organizations that are already churning out tons and tons of PCB designs?

• 2:57:24Speaker 10

  Yeah, so it's a good mix, but most customers are SMBs. What we're seeing is that there is like, you know, only about twenty five percent of our customers have previously made a PCB board themselves.

• 2:57:32John Coogan?

  Sure.

• 2:57:33Speaker 10

  The others are technical. They are mechanical engineers, firmware engineers, industrial designers, right? But they didn't have the time, patience or resources before to make custom boards. And they would probably see, basically buy OEM boards, right? If you think about, like, if you have an example, I have, we have this customer that make vending machines, like Snack, David vending machines. And they would previously buy four, five off-the-shelf boards and integrate them into single machines. They think about the board, the paused the display, the payment, the motor in here and so on. Um, and now they can make like a custom, like a single custom board with flux, right? That's much cheaper to integrate into the machines on the assembly line. The machine breaks down in the field, but you know where they're standing, they're like somewhere in the rain, you know? There's one board to replace. And then, right, the board costs in pennies on the dollars compared to before, right?

• 2:58:15Speaker 10

  Because what you're paying now is material cost, you know, to a manufacturer in China, right? I can do that for you. And so that's kind of like here, the, the main driver, I think.

• 2:58:25John Coogan?

  What's your favorite printed circuit board or favorite product that has a PCB in it?

• 2:58:30Speaker 10

  Ooh, the Space Shuttle?

• 2:58:32John Coogan?

  The Space Shuttle? That's a good answer.

• 2:58:34Speaker 10

  No, I looked this up the other day, so the Space Shuttle, uh, I think was one of the first boards that had like eight layers or so, right? At the time. And it was hand drawn. They didn't have software for it at the time, right? Which is like crazy if you think about that.

• 2:58:47John Coogan?

  Yeah.

• 2:58:48Speaker 10

  Um, so yeah, it's like a fun anecdote.

• 2:58:50John Coogan?

  That's a great one. Jordy, anything else?

• 2:58:52Jordi Hays?

  Wild, wild, wild. Uh, how?

• 2:58:56Jordi Hays?

  Have you seen anything exciting on the US side on the supply chain?

• 2:59:01John Coogan?

  On actual PCB manufacturing?

• 2:59:03Jordi Hays?

  Yeah, is there? I feel like we had somebody on the street last year that was trying to make PCB.

• 2:59:08John Coogan?

  Like, we have send, cut, send now for like machined parts and things that you need to cut. Is there a great company in America that's starting to think about PCBs?

• 2:59:18Jordi Hays?

  Yeah, like if we have our own Shenzen, I imagine it would have a variety of manufacturers like this. To really, because you want to get to the point where you can kind of sit next to the manufacturer and really speed up that iteration cycle.

• 2:59:30Speaker 10

  Yeah, a lot of people like us want that, right? We looked into the details of like opening our own fab here in Fremont or so. But you realize quickly, right, making PCB boards, like the board itself is a chemical process. Good luck getting the permits, right? It's possible, but it's hard, right? And so these are kind of like the bumps you run into. But I think there is exciting opportunities here, right?

• 2:59:53Speaker 10

  Especially because if you're designing these boards with AI, right? Then you can also optimize for the capabilities in the inventory you have at the factory, right? Because the way to make this cheap to make is to like design a circuit, can be assembled automatically by machines, right? But for that to work, essentially these pick and place machines, they have to have all the semiconductor you need on the rails, right? And that's difficult to do for humans to optimize for, right? Because it's like a quick changing thing. But I think as for automating all this, right? We can have the models designed towards what the factory can spit out in an hour, you know, for almost zero cost.

• 3:00:29John Coogan?

  That's amazing. Congratulations. Thank you so much for taking the time to come talk to us.

• 3:00:33Jordi Hays?

  With this pace, I'm sure you'll be back on this year.

• 3:00:36John Coogan?

  Yeah, this is amazing.

• 3:00:37Speaker 10

  Yeah, I hope so.

• 3:00:38John Coogan?

  Have a great rest of your day. We'll talk to you soon. Let me 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. Up next, we have some exciting news from Zach from CalAI. He's the co-founder and CEO, who is not here.

• 3:00:58Jordi Hays?

  We are getting him set up.

• 3:01:00John Coogan?

  Sorry about that.

• 3:01:01Jordi Hays?

  We can head.

• 3:01:02John Coogan?

  We can head to the timeline because we have an incredible. An announcement from Riley Walls, the new OpenAI staffer, who launched Payphone Go. It's effectively Pokémon Go, but for payphones. Payphones are strangely still licensed in California, he says. So I filed a FOIA request and got the full list. Naturally, I made a game, so you can now play. You create an account, you get your unique player ID. It's a nine-digit number. Then you use the map to locate one of California's payphones. Some are easy to find, some are not. Pick up the receiver, you dial this phone number, 888-683-6697. It's toll-free, so no coins required.

• 3:01:45John Coogan?

  You can just go to any payphone that you can find. And then you call in and you enter your player ID, and you collect them all. You have to catch them all. All 2,203 payphones in California are at stake. And Riley is on another absolute generational run with these projects. I love these, they are so much fun. Go check it out, and congrats to Riley on another banger project. Well, I believe we have our next guest, but you know.

• 3:02:12Jordi Hays?

  Yes, but Zach is gonna be later.

• 3:02:13John Coogan?

  Zach will be later, so we're gonna jump over to...

• 3:02:16Jordi Hays?

  What's going on?

• 3:02:17John Coogan?

  How you doing?

• 3:02:18Jordi Hays?

  Sorry for the confusion.

• 3:02:18Speaker 11

  Hey, how's it going? No problem, nice to meet you guys.

• 3:02:21John Coogan?

  Good to meet you. Please introduce yourself and the company.

• 3:02:25Speaker 11

  Yeah, I'm Joan Rodriguez. I'm from Barcelona, Catalan. I'm the CEO and founder of Quiver AI. And at Quiver, we are, you know, building models for AI generation of SVGs.

• 3:02:39John Coogan?

  Okay.

• 3:02:40Speaker 11

  Vectographics, you can pull a text prompt, and you can get a vector graphic. Or you can pull an image, and you can vectorize it.

• 3:02:47John Coogan?

  Love it.

• 3:02:47Speaker 11

  So it's really good for designers, really good for icon generation, logos, and so on.

• 3:02:52John Coogan?

  PNG to vector to SVG was such a hassle, like, a decade ago, maybe even like five years ago. It's still, it's still not perfect. What's the secret? Because I've seen these demos from, I think the latest Gemini 3.1 was doing some SVG drawings. It was pretty good. What's the secret to going superhuman in SVG generation?

• 3:03:14Speaker 11

  Well, that's a great question. It's a pretty challenging problem and we are tackling this through a kind of new paradigm. So it's code generation.

• 3:03:23John Coogan?

  Okay.

• 3:03:23Speaker 11

  So an SVG is actually code in the back, you know, it's kind of a bunch of code and you compile it and you can get an image out of it. And previous methods were mostly like tracing, you know, like you get an image and you kind of trace it. But yeah, I did this PhD in SVG and I invented this method where you can actually get really cool SVGs through code generation. So you know, LLMs are really good at code, we know this, and I just went nuts in my PhD to try to train these models as good as I could.

• 3:03:54John Coogan?

  I imagine part of the benefit is that once you have an SVG, you can export that to Figma or Illustrator and then edit and do the final, if your output's 99%, much better than getting a PNG that's 99% and then you gotta go and clean everything up and it takes a lot longer. You can adjust the actual splines, is that correct?

• 3:04:13Speaker 11

  That's, that's correct. Yeah, you can edit, you can change the colors, you can maybe do animations later.

• 3:04:18John Coogan?

  Oh, sure, sure.

• 3:04:19Speaker 11

  Yeah, Gemini is really good for that too. Like animations is something that's popping up a lot in Design X. So yeah.

• 3:04:25Jordi Hays?

  What do you, how are you thinking about competition long-term? Sounds like you guys can kind of lead in this space, but at the same time, I imagine all the labs like kind of care about this category. Do you imagine partnering with them or having a different distribution strategy? What does that look like?

• 3:04:47Speaker 11

  I mean, it's exciting to see all the good results. They are also evaluating our ideas. We have ideas to try and the big labs are, you know, showing really good results in the SVG space. We are seeing that if you just train a big model with a lot of data and just a bit of effort, you are going to see really good results in this space. And what we are doing, yeah, we're kind of doing this our own thing, our own way with our own RL rewards one at a time and trying to learn how to do this the right way.

• 3:05:18John Coogan?

  How do you think about the customer? Do you want to integrate with a piece of software that already runs and lives and breathes SVG? Or do you want to be sort of like this one-off tool that lives on a website that, you know, artists and creators can go interface with and then just take the assets elsewhere?

• 3:05:35Speaker 11

  Yeah, great question. And so we started with a customer kind of consumer approach. We built our website and we wanted to see what people do with these tools. But at the same time, we build our API so that other tools can also interact with our with our models and build on top of it. We can see agents already being deployed. We can see MCP servers calling Quiver. And we are seeing, you know, all sorts of tools, integrations with all your, you know, kind of stack of tools for designers.

• 3:06:07John Coogan?

  Yeah.

• 3:06:07Speaker 11

  And that's what we are aiming for, to be, you know, very close to the stack and workflows of designers.

• 3:06:12John Coogan?

  Yeah, this is Christmas for After Effects artists. I've played with a lot of this stuff. It's a lot of fun. Congrats, Jordi, anything else?

• 3:06:18Jordi Hays?

  Where, uh, where's the company base?

• 3:06:21Speaker 11

  It's gonna be based in San Francisco.

• 3:06:23John Coogan?

  Cool.

• 3:06:23Jordi Hays?

  But you're calling, calling in from, uh, Barcelona? Or, or?

• 3:06:27Speaker 11

  That's right.

• 3:06:27Jordi Hays?

  Not yet, in the process of moving.

• 3:06:29John Coogan?

  Last thing, you raised some money. How much did you raise?

• 3:06:32Speaker 11

  Yeah, we just raised eight point three million dollars from 1.860.

• 3:06:37John Coogan?

  Congratulations. I'm so happy that this is funded. This is, uh, this is very, very cool.

• 3:06:43Jordi Hays?

  Great, great use of your PhD time, too. It feels like you're obviously just getting started with Quiver, but, uh, been at it for quite a while. It's very cool.

• 3:06:52John Coogan?

  Very cool. We will talk to you soon. Have a good rest of your day.

• 3:06:55Jordi Hays?

  Cheers.

• 3:06:55Speaker 11

  Beautiful.

• 3:06:56John Coogan?

  Goodbye. Let me tell you about vibe.co. We're D to C brands, B to B startups and AI companies advertising on streaming TV, pick channels, target audiences and matter of sales, just like on Meta. And we have our next guest in the research waiting room. Let's bring him in to the TVP and Ultra Jump.

• 3:07:10Speaker 12

  My man.

• 3:07:11John Coogan?

  Zach, finally, how you doing?

• 3:07:14Speaker 12

  I'm good. How are you guys?

• 3:07:15John Coogan?

  Congratulations. Tell us what happened. I want to hit the gong for you.

• 3:07:18Speaker 12

  Well, thank you. After a year and a half journey building Calais, I, we were finally acquired by MyFitnessPal.

• 3:07:30Speaker 12

  Thank you, thank you.

• 3:07:31John Coogan?

  When, when did you meet the team at MyFitnessPal?

• 3:07:34Jordi Hays?

  Yeah, yeah. Break down the deal.

• 3:07:35Speaker 12

  We, yeah, we spoke to them initially back in May. I was talking to a few companies, reaching out to them before going to college, because it could have been, if we got the right offer, it would have, I think, made sense. I could have maybe had a normal college life for a little is what I was thinking. We didn't move forward at that point with anything, but built those relationships and then kept in touch. And when it finally made sense, we moved forward.

• 3:08:00Jordi Hays?

  And, and I think I saw on your announcement, you closed it while you were 18 and you're just announcing it now. Is that correct?

• 3:08:07Speaker 12

  Yeah, so we closed it in December when I was 18 and then I turned 19 in January. So now it's, now I'm 19, now I'm like...

• 3:08:14Jordi Hays?

  Brutal dude, you're washed. You're shocked. You're off now. It's not even, it's not even... It's over, it's over now.

• 3:08:20John Coogan?

  Give us the scale of the business, the monetization. I mean, describe it for those who don't know. And then I, and then I want to know, how did you grow this thing? How big did it get?

• 3:08:31Speaker 12

  Great question. Calai is an app where you could track your calories just by taking a picture of your food. And we did $30 million in revenue in 2025.

• 3:08:42John Coogan?

  Wow.

• 3:08:42Speaker 12

  And we just finished January, I didn't check February, but January, we did 5.7 million in revenue. It's a subscription model.

• 3:08:50John Coogan?

  That is incredible. So heavily dependent on iOS in-app subscriptions? Are you Android as well? How, how important has that been?

• 3:08:59Speaker 12

  Android is definitely less important. It's maybe a 10th of our revenue. It pretty heavily is just iOS.

• 3:09:05John Coogan?

  Yeah. And then acquisition, what is this influencer driven, ad driven?

• 3:09:10Jordi Hays?

  Customer acquisition.

• 3:09:11John Coogan?

  Yeah, customer acquisition. I mean, obviously you're on the charts, but are there viral mechanics? Like what is the growth engine for the app?

• 3:09:20Speaker 12

  Early on, it was mainly influencers. And then as of recently, the last maybe six months, we've primarily continued our growth through paid acquisition on channels like Meta. And so the two combined are really what's driving it.

• 3:09:32John Coogan?

  Makes sense.

• 3:09:33Jordi Hays?

  What, uh, why, what are the kind of key reasons why MyFitnessPal wanted to pick you guys up? I can think of a lot, but what, what, what drove this?

• 3:09:45Speaker 12

  Well, definitely many, many reasons. We have different audiences, different core audiences, but then we also have overlap. And we both are very mission driven. We both just want to help the greatest number of people as possible become healthier. And so since we were, since we have this overlapping space, we realized that it would make sense to come together, share resources, and it would further the mission for both of us and really makes sense to just partner.

• 3:10:18John Coogan?

  Talk about accuracy. I think there's some people that are skeptical that AI can take a picture of food and tell you how many calories are in it. How has that evolved over the year or so that you've been running the company? Like, how accurate was it at the start? How accurate is it now? Where do you expect it to go?

• 3:10:34Speaker 12

  The accuracy of Cal AI early on, it definitely wasn't as good as it is today. We initially started by just running ChatGPT by itself. Pretty much as the model, you would just take the picture, put it into ChatGPT, say, how many calories is this? Output the response.

• 3:10:50Jordi Hays?

  Total rapper victory.

• 3:10:52John Coogan?

  Total rapper victory. Honestly, congratulations. It's so amazing.

• 3:10:56Speaker 12

  Well, that was like a month.

• 3:10:57John Coogan?

  Yeah.

• 3:10:58Speaker 12

  And then we fine tuned a model. We built out a more complex pipeline, using like a ton of different models for different steps. And so it's become more and more accurate over time. At this point, we average over 90% accuracy. For each food scan, but you'd actually be surprised, only 30% of the scans are, only 30% of food logs come from scanning. The rest are like barcodes typing in in the database. So that, those are the most accurate methods.

• 3:11:24John Coogan?

  That makes a ton of sense. That makes a ton of sense.

• 3:11:26Jordi Hays?

  Very cool. What, uh, what are your guys' combined ambitions now? Where do you want to take, uh, are, are you going to be supporting on the main MyFitnessPal? App as well? Like, are you, I imagine, like, they've seen what you guys can do from a user acquisition standpoint and a product design standpoint and, and want your help across the org.

• 3:11:47Speaker 12

  We're definitely helping any way we can. So definitely some of our marketing systems, we are helping them to also build out. And they're helping us too, teaching us things that we didn't know. So together, we're going to be able to go a lot further. And we're going to remain standalone apps.

• 3:12:09John Coogan?

  Cool. Well, congratulations.

• 3:12:11Jordi Hays?

  Congrats. Yeah, congrats to the whole team. Uh, yeah.

• 3:12:14John Coogan?

  An actual overnight success.

• 3:12:16Jordi Hays?

  Truly, truly an overnight success.

• 3:12:18John Coogan?

  But the beginning of a long career, I can tell already.

• 3:12:20Jordi Hays?

  Yeah, I know. I can't, I can't wait till we'll be here when you're, when you turn 40.

• 3:12:25John Coogan?

  Come back on.

• 3:12:26Jordi Hays?

  Probably your third exit at that point. Hopefully an IPO.

• 3:12:29John Coogan?

  Oh, they're 30 in exit.

• 3:12:30Jordi Hays?

  You got the, you got the exit at 18. We'd like to see the, the IPO by 20, uh, by the time you're, uh, you're 30.

• 3:12:39John Coogan?

  Awesome. Well, congratulations. We'll talk to you soon, Zach.

• 3:12:43Jordi Hays?

  Congrats.

• 3:12:43Speaker 12

  Thank you. Talk soon.

• 3:12:45John Coogan?

  Have a good one. Let me tell you about Sentry. Sentry shows developers what's broken and helps them fix it fast. That's why 150,000 organizations use it to keep their apps working. And up next, we have our last guest, Andy Markoff from Smack Technologies. He's the co-founder and CEO.

• 3:13:01Jordi Hays?

  What's happening?

• 3:13:02John Coogan?

  Andy, how you doing?

• 3:13:04Speaker 13

  Great. Thanks for having me on.

• 3:13:05John Coogan?

  Welcome to the show. Uh, first time in the show, please introduce yourself and the company.

• 3:13:09Speaker 13

  So Andy Markoff, co-founder and CEO of Smack Technologies. I'm a, well, I like to say a recovering member of a cult known as the United States Marine Corps. Spent the first 10 and a half years of my professional career there, uh, got out, um, tried to figure out what I wanted to do when I grew up. And, uh, luckily, one of the Marines I served with, my co-founder Clint Allen East, got out and we both decided to work on building the, the decision-making tools we wish we'd had when we were running the kill chain during our careers as, you know, Marine Raiders at Marsoc and like, try and give back and like, find a way to serve again after we'd both gotten out. So we. Talked about this idea, you know, really fall of 2023 and then started the company in January 24.

• 3:13:49Speaker 13

  Really, so what SMAC is, we are the first frontier AI lab solely focused on building for national security. And our mission is what we would call decision dominance. But how do we take, you know, petabytes of sensor data, multimodal data streams that, you know, too much for a human to actually analyze and then convert that analysis in real time into the right decisions across a range of military operations? Whether that's trying to figure out what are we doing for the next one to six months? What are we doing for the next one to four days? And like literally right now, what are we doing? But trying to make that process seamless and what right now is a pretty silent and slow system.

• 3:14:25John Coogan?

  What are you building on top of? Like, it feels like Palantir exists, there's databases, like, it's not like technology was just invented, but AI was obviously new. So, uh, like, how, how are you integrating with systems? What, what are the tailwinds here that allow you to actually deploy systems effectively and quickly?

• 3:14:43Speaker 13

  Yeah, I think, I mean, at the end of the day, we are not building on top of another like AI model, building our own model.

• 3:14:49John Coogan?

  Yeah.

• 3:14:49Speaker 13

  Um, and I think that's, you know, the reason for that is general purpose, like large language models are, are very useful and they're very good at analyzing massive amounts of textual data. They have a lot of really, you know, important use cases, but they are not the right tool for 80% of military decision making, like, and some of that's just they're trained on labeled data sets. There's no labeled data set for World War III, you know, hopefully we never have that data set. But, but you need a different type of model to make decisions on multiple time horizons, do the type of hard, you know, physics grounded geospatial reasoning required for most military decisions. And that's, you know, deep reinforcement learning is a, is the right approach for that problem set. So we're, we're building a deep reinforcement learning model.

• 3:15:34Speaker 13

  And instead of, you know, labeled data sets, we're, we're training that model in an environment that's been built by, you know, physicists who are grounded in like the physics of a peer level conflict, but also domain experts. And I think that's a lot of our advantage and secret is there's, there's a lot of information and expertise about how to fight wars that are in people's heads. They're not, it's not in a document that can be read, that need to be encoded and put in an environment to, to make a system that can actually function in that type of environment.

• 3:16:03John Coogan?

  Interesting. So, uh, I mean, a lot of the foundation labs are going to. Uh, data providers, data brokers, hiring experts to write down their SOPs. You're, you're obtaining data from the US government, is that correct? Like, what does that, what does that pipeline look like?

• 3:16:20Speaker 13

  Sure, so, so building this data is, you know, some of the domain expertise we have hired on the teams. I mean, you know, Clint and I's background, I was a, I was a joint fires instructor for a while at the Marine Corps' version of Top Gun. Clint kind of spent his whole career, like, in the fire space as we did at Marsoc. Um, we, we've hired a lot of people on the team that were the absolute best at their military discipline. They were instructors and they did it on deployment. And then we work with our end users. And I think in, in some ways this gets to how do you trust? How do you trust AI and how do we get users to trust AI? It's like we, the users are part of our training data generation, like taking their knowledge, their understanding of the right way to do things today.

• 3:17:03Speaker 13

  And helping bring that into the environment in a way that, you know, they can trust that like their knowledge and their understanding is actually being used to help the model get to a better start point.

• 3:17:11Jordi Hays?

  What, uh, ways in which, uh, conflict is evolving are you guys like willing to lean on and effectively bet the company around? It's obviously great to have the, uh, all the, the, uh, time actually enlisted and, and serving the country. But, uh, the battlefield's like evolving, you know, I'm sure you've been, uh, you and the team have been watching all the footage coming out of the last, uh, few days. Uh, but, but where, where is this all kind of going in your view?

• 3:17:43Speaker 13

  As far as where is like kind of conflict moving?

• 3:17:46Jordi Hays?

  Well, an example is like, I think we saw like the US version of a Shahed or I think, uh, like so, so, uh, low cost autonomous systems. Uh, seem to be, you know, coming online en masse and, and, uh, All of these things are going to impact how you build the product.

• 3:18:06Speaker 13

  Sure. So I mean, I think at the end of the day, you know, the scaling and operationalizing autonomous systems is a large part of the future of warfare, right? And so I think that the concept that we talk about internally that we need to build and enable is what we would call intelligent autonomy. But how do you orchestrate all of these autonomous systems, not just against tasks that they've been assigned to, but with each other and with the more exquisite, expensive systems? And how do you do that in a way where you still have a human in the loop, right? I think there's been a lot of discussion about fully automating the kill chain. No one wants that. That's not even really something that I've heard anyone talking about. What fundamentally people are trying to do is have

• 3:18:47Speaker 13

  the right amount of human in the loop, have humans for high value human touchpoints. It's not everywhere humans are making decisions today. Like, we can't have humans involved in every single thing that they're involved in today. But a lot of the, a lot of the decisions are not high value decisions that are humans genetically positioned to do. So it's intelligent times about removing humans from low value human touchpoints, keeping them and bringing them back into the system for those touchpoints that they need to make decision, whether for ethical reasons or for tactical reasons, and enabling them to make decisions that help move, you know, hundreds of thousands of, you know, autonomous systems and manned platforms and, you know, other types of unmanned platforms towards common goals across a, you know, what could be 100

• 3:19:31Speaker 13

  million square mile theater. And like, I think that's, that's really the spec that we have to build towards.

• 3:19:38Jordi Hays?

  Makes sense. What's the shape of the company today? Where are you guys based? What are, what are you, what are your plans with this, with this new capital?

• 3:19:47Speaker 13

  Sure. So we are, you know, a team of 18 today, really split mostly between El Segundo, we're like, the majority of the tech team's El Segundo and like a headquarters in, in Texas. We, we have a physicist, a physics lab like down in Texas. A part of the tech team is there. And in really, Our product, the way we think about it is that we need to have a model, like a heavier weight model that is available for people that work out of an operations center or not like compute limited. And then, you know, lighter like lighter versions of that model that can work at the edge of the front lines where people are going to be bandwidth constrained. And so a lot of this year is getting what currently we're deployed under contract with

• 3:20:28Speaker 13

  the Air Force, the Marine Corps, and the Navy is to expand across all six services, both at the command level, but also to take what right now we're prototyping is the edge version of the model we built and get that deployed to frontline units across all six services by the end of the year.

• 3:20:44John Coogan?

  Take us through the fundraising round. How much did you raise?

• 3:20:47Speaker 13

  So we've raised 32 million to date, 26 million.

• 3:20:57Speaker 13

  And we've been frankly just really fortunate to have the investor team that we had. I mean, like I was saying earlier today, you know, Clint and I knew nothing about fundraising, procurement, government acquisitions, like we didn't know, we just like were wandering around in the dark, you know, back in January 2024, trying to get moving and having a point 72 kind of take us early on, believe in us, kind of teaches the ropes of the defense tech space was tremendously valuable. And, you know, we've been really fortunate to have, you know, Geodesk and Cosino co-lead the Series A to really help us figure out how do we get to the next, how do we get to the next scale? How do we start scaling the team? How do we build the systems that allow us to grow rapidly? And we've just been really fortunate to have supportive investors that understand the

• 3:21:39Speaker 13

  vision and kind of knew what we needed, knew what they could teach us at different phases.

• 3:21:44Jordi Hays?

  What's the origin of the name?

• 3:21:47Speaker 13

  So SMAC is actually a tactical task that you would call over the radio to strike a target. So when I was, you know, we'd be out on a raid, you know, Afghanistan, Iraq, and like you'd have a hostile target that you were going to call in an airstrike on, you know, the conversation that you just smack that target is actually like a task. So that was, and I think, you know, fires, fires is one of the military's functional areas, but I think that's an area that's, you know, Clint and I's specialty. And so that was a lot of our initial go to market was in the fire space and we were initially heavily focused on that, but obviously we're expanding this year to kind of the range of military decision making.

• 3:22:25Jordi Hays?

  Is it, is it true that, that you hired someone named John Coogan?

• 3:22:29Speaker 13

  It is, uh, it is true. I actually was getting really confused earlier today when like I, I saw yours. I was like, why, why is John, why is my John on Twitter? He's also a Marine too. I was like, Marines don't even use Twitter for X.

• 3:22:43Jordi Hays?

  Very cool. Yeah. Go around and tell everyone, yeah, I hired John Coogan.

• 3:22:46John Coogan?

  There you go.

• 3:22:47Jordi Hays?

  You're like, what?

• 3:22:49John Coogan?

  That's very fun.

• 3:22:49Jordi Hays?

  Uh, awesome. Well, great, great to meet you and, uh, I'm sure you'll be back on soon.

• 3:22:53John Coogan?

  We'll talk to you soon.

• 3:22:54Speaker 13

  Awesome. Thanks for having me.

• 3:22:55Jordi Hays?

  Cheers, Andy.

• 3:22:55John Coogan?

  Have a good one. Thank you. Let me tell you about Plaid. Plaid powers the app to use to spend, save, borrow, and invest securely, connecting bank accounts to move money, fight fraud, and improve lending now with AI. We have a debate to settle.

• 3:23:09Jordi Hays?

  Is it PetSmart or Petsmart?

• 3:23:12John Coogan?

  I have a opinion here. I, I will settle this, but we should vote as a group. Uh, we should also play this video of the folks who kicked this off. Ben Lapides has a whole song asking the question, is it Petsmart or is it Pets?

• 3:23:37John Coogan?

  The aesthetic of this is incredible.

• 3:23:41Jordi Hays?

  Is this real?

• 3:23:42John Coogan?

  This is a real video. They went dressed up and found an office and trashed it for this video. So much production. So the question, is it a mart that caters to pets? Or is, are they saying that taking your pet there is the smart thing to do? Which side of the debate do you come down on, Jordy?

• 3:24:07Jordi Hays?

  Uh, they are smart about pets.

• 3:24:10John Coogan?

  Oh, okay. You're a smart guy. I'm the opposite. I think it's the Petsmart. I think it's.

• 3:24:16Jordi Hays?

  Oh, and is it because the balance is?

• 3:24:18John Coogan?

  I, so there are two sides of this. Adam Bain, former CEO of Twitter chimed in. Is it PetSmart or Petsmart?

• 3:24:27John Coogan?

  Is the color in the logo indicates that they are saying pets are smart, but the bouncing ball suggests that it's a mart for pets. Which one is it? It can't be both. Of course, it can be both. The logo designers are probably having fun, but I'm, I'm, I'm a bouncing ball guy. I say it's the mart for pets.

• 3:24:42Jordi Hays?

  Albert in the chat says WTF, I just entered a pet smart.

• 3:24:45John Coogan?

  That's gotta be weird. Tyler, where do you sit on this?

• 3:24:50Jordi Hays?

  Now would be a good time, Albert, to tell you that-

• 3:24:51John Coogan?

  Oh, tiebreaker over here. We got, we got Tyler on my side.

• 3:24:54Speaker 02

  Which way did you go?

• 3:24:55Jordi Hays?

  I'm with John.

• 3:24:55John Coogan?

  Tyler took my side. It's the mart for pets.

• 3:24:58Jordi Hays?

  That just doesn't make sense. Why would they, the, the-

• 3:25:00Speaker 02

  All, all the things you buy in Petsmart are, are for pets. It's a place that holds things for pets.

• 3:25:05John Coogan?

  It's a mart.

• 3:25:06Speaker 02

  Mart.

• 3:25:06John Coogan?

  It's a mart.

• 3:25:07Speaker 02

  No.

• 3:25:07John Coogan?

  No.

• 3:25:08Speaker 02

  Petsmart.

• 3:25:08Jordi Hays?

  It would be pets, all red, and then-

• 3:25:12John Coogan?

  And then blue, M A R T. But they flipped it. No, you make a compelling argument, but I still disagree.

• 3:25:18Jordi Hays?

  Somehow, in all the news, I don't think we ever said the words that-

• 3:25:24John Coogan?

  We never rang the gong.

• 3:25:25Jordi Hays?

  OpenAI raised a $110 billion round of funding from Amazon, Nvidia, and SoftBank. So I'm grateful for the support from our partners and have a lot of work today to bring you the tools you deserve. That's probably the biggest, that's a gong record?

• 3:25:41John Coogan?

  Yes. It's the biggest round for a private company ever, and it's also about one quarter of venture capital outlays that are expected for 2026 in one round.

• 3:25:50Jordi Hays?

  Absolutely, absolutely wild.

• 3:25:54John Coogan?

  400 million will be invested from venture capitalists broadly. Of course, this money's from the hyperscalers. It's, it's more complicated than your average VC deal. I don't even know if this will be included in the VC-

• 3:26:04Jordi Hays?

  Funding.

• 3:26:05John Coogan?

  Funding tallies, because it's such a big round and it's from so many strategics. But lots of more capital for OpenAI.

• 3:26:13Jordi Hays?

  Voe says, everything on earth is thought bait. They're just trying to keep me pensive.

• 3:26:20John Coogan?

  It's true. This is true. What, what else?

• 3:26:26Jordi Hays?

  Ryan Peterson is saying, happy late Valentine's Day to my wife, when a semi-Neanderthal man loves a mostly human woman.

• 3:26:36John Coogan?

  Very odd. We should plant the bomb. We should, we should get out of here. We have another podcast to do actually, that will go live.

• 3:26:43Jordi Hays?

  We're gonna break, we're gonna do five hours.

• 3:26:45John Coogan?

  We're doing five hours today. You'll need to

• 3:26:46Jordi Hays?

  On the air.

• 3:26:47John Coogan?

  Tune in later. We will tell you.

• 3:26:49Jordi Hays?

  Share the podcast that we're going on too.

• 3:26:50John Coogan?

  But leave us five stars. Hit that subscribe button. Sign up for

• 3:26:53Jordi Hays?

  And

• 3:26:54John Coogan?

  tntvndotcom newsletter.

• 3:26:56Jordi Hays?

  Last but not least, the US Open is letting you know that the US Open will return to Inverness Club in 2045.

• 3:27:01John Coogan?

  2045, let's go. See you tomorrow.

• 3:27:04Jordi Hays?

  I can't wait.

• 3:27:04John Coogan?

  Goodbye.

• 3:27:05Jordi Hays?

  Have a wonderful evening.