AI Model Showdown: Grok 4.1 vs. Gemini 3 | E2211

AI Model Showdown: Grok 4.1 vs. Gemini 3 | E2211 Register for Founder University Japan's Kickoff! https://luma.com/cm0x90mk Today's show: *Will the arrival of two hotly-anticipated, intensely powerful AI models snap the Doomer cycle? On a new TWiST, Jason and Alex consider the current AI landscape, one where cynicism about insider mega-deals, fear of job displacement, and concerns about bubble bursts seem to rule the day. Will the arrival of two powerful new models — xAI's Grok 4.1 and Google's Gemini 3 — help the industry to course-correct? And how do we decide how much these models have improved anyway? PLUS we're investigating Cloudflare's recent downtime and their acquisition of Replicate. Are we heading toward a future in which everyone runs their own models, locally? And how worried should founders get if their products or sites go down for a few hours? Finally, if you're an investor, and want to come to Jason's Dim Sum Demo Day in San Francisco, here's the link: http://launch.co/dimsum Timestamps: (2:01) Why the internet got broadly degraded when Cloudflare went down (5:00) How worried should founders become when their sites go offline? (6:44) Downtime aside, what did Cloudflare want with Replicate? (8:12) Why Jason predicts one day we'll run our own local language models (9:39) Goldbelly - Goldbelly ****ships America's most delicious, iconic foods nationwide! Get 20% off your first order by going to Goldbelly.com and using the promo code TWiST at checkout. (15:25) How to turn off "Learn From This App" on your iPhone (17:29) Will the arrival of hotly-anticipated new models stop the spread of Doomerism and AI cynicism (20:00) Every.io - For all of your incorporation, banking, payroll, benefits, accounting, taxes or other back-office administration needs, visit every.io. (23:53) Checking back in with the "Best AI Model" Polymarket… why has ChatGPT dropped so low? (29:43) Zite - Zite is the fastest way to build business software with AI. Build apps, forms, websites and portals that connect to the tools you already use. Go to zite.com/twist to get started. (31:14) ANOTHER AI mega-deal? Nvidia and Microsoft are investing in… ANTHROPIC (33:06) Why so many AI deals now include "up to…" language around investments (35:04) What Jason thinks of Dario Amodei's warning about white collar job displacement (39:39) If we all agree AI job displacement is coming… what can be done? (45:16) All about Jason's Dim Sum Investor Demo Day in San Francisco! Subscribe to the TWiST500 newsletter: https://ticker.thisweekinstartups.com Check out the TWIST500: https://www.twist500.com Subscribe to This Week in Startups on Apple: https://rb.gy/v19fcp Follow Lon: X: https://x.com/lons Follow Alex: X: https://x.com/alex LinkedIn: ⁠https://www.linkedin.com/in/alexwilhelm Follow Jason: X: https://twitter.com/Jason LinkedIn: https://www.linkedin.com/in/jasoncalacanis Thank you to our partners: (9:39) Goldbelly - Goldbelly ****ships America's most delicious, iconic foods nationwide! Get 20% off your first order by going to Goldbelly.com and using the promo code TWiST at checkout. (20:00) Every.io - For all of your incorporation, banking, payroll, benefits, accounting, taxes or other back-office administration needs, visit every.io. (29:43) Zite - Zite is the fastest way to build business software with AI. Build apps, forms, websites and portals that connect to the tools you already use. Go to zite.com/twist to get started. Great TWIST interviews: Will Guidara, Eoghan McCabe, Steve Huffman, Brian Chesky, Bob Moesta, Aaron Levie, Sophia Amoruso, Reid Hoffman, Frank Slootman, Billy McFarland

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

• 0:00Jason Calacanis?

  I heard Gemini 3 is out. I heard Grok 4.1 is out. Everything is happening so quickly in our industry.

• 0:07Speaker 01

  Look at what XAI did. Grok 4.1 is really good across a number of metrics. Compared to Grok 4 fast, it's dramatic improvement. When 4.1 was released onto the charts, it went straight to the top. And I think it just shows that there's several different AI labs here in the US that are able to successively create state of the art models. And I think it also pushes back, Jason, against some of the doomerism that's been kind of building in the last three months.

• 0:31Jason Calacanis?

  One of the great things is, I guess, that now that we have these leader boards, it's motivated all these companies and gotten these teams super excited about claiming the top spot. That's where I'm just getting a little concerned of, you know, like, are we actually making progress at solving the real world problems people have? Or are we getting good at acing the SATs? And that is a question for me.

• 0:56Speaker 01

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• 1:40Jason Calacanis?

  All right, everybody. Welcome back to This Week in Startups. There's tons going on in the news. I heard Gemini 3 is out. I heard Grok 4.1 is out. Everything is happening so quickly in our industry. I'm having a hard time keeping up.

• 1:54Speaker 01

  No, it's been really, really busy. I want to start though, Jason, with the CloudFlare outage. I don't know if you were awake or asleep. I know you've been going through some jet lag. The, the internet broke this morning. It actually made getting the docket ready kind of hard. It's funny when a news story really impacts us because services like ChatGPT and X and other kind of major planks, you might say of the podcast economy, uh, broke. And for several hours, CloudFlare had these really embarrassing downtime outages. And the good news is that now that we're here, it has been resolved. They've come out and apologized for it. If you're curious, everyone, what drove this? They said that, quote, "A latent bug in a service underpinning our bot mitigation capability started to crash after a routine configuration change we made."

• 2:35Speaker 01

  And Jason, you'll know this, that cascaded into a broad degradation of our network and other services. Sure, whatever that means. Uh, it was bad, though.

• 2:44Jason Calacanis?

  Yeah, you know, CloudFlare is this great, um, CDN, I guess, content delivery network. And if you have a website and you get these DOS attacks, these denial of service, D-DOS, where, you know, people would send, you know, tons of pings to your server, try to slow things down and cause a disruption in service, they figured out ways to, when all those attacks come in, to just drop them. And because it's a network, you know, if some hacking group has, you know, 10,000 servers or maybe even individual machines on the internet that they've hijacked to send in these denial of service attacks, just to think about it simply, they'll hijack 10,000 Windows machines, send a bunch of attacks to a website and then all of a sudden you can't read the Drudge Report or New York Times or whoever their target is.

• 3:29Jason Calacanis?

  They know those IP addresses. They know what it feels like when those kind of attacks happen. They know the signature and they just drop those requests. It's pretty sophisticated. It's pretty basic, but CloudFlare has become kind of a standard for this CDN. I remember when we were running Weblogs Inc. back in the day, this 20-year-old knowledge, but we started using these different CDNs, different caching servers. We put up our own caching servers. We were handling these issues ourselves. Now everybody abstracts it to providers. What's the value of being able to abstract it to a provider like this is, well, you can focus on other things in your business. What's the downside? If everybody trusts, everybody's got their eggs in one basket, whether it's Amazon Web Services

• 4:12Jason Calacanis?

  or Google or Azure or in CloudFlare, everybody gets affected at the same time.

• 4:19Speaker 01

  That's kind of what I want to talk about because normally this is a little bit outside of our wheelhouse, Jason, but there was a CloudFlare outage also in June. There was an AWS outage in October. There was a Google Cloud outage in June and there was an Azure outage in October. So you're a startup founder and you are running a software business as most of them are. You are using cloud services as most of them are. Communication strategies for downtime mitigation, just I'm curious what your advice is to founders as they go through this apparently recurring issue.

• 4:49Jason Calacanis?

  It's a recurring and non-consequential issue at this point. Like the downtime happens for an hour or two and frankly, we're all permanently online. So it's actually good. Everybody gets a little break. I would be concerned if your service is down for more than a couple of hours. If it gets into like, okay, it was down this morning, but it's still down this afternoon. It's still down this afternoon. That's when people start to go, wait a second, maybe I should look at another option. And you just don't want to get into the, okay, it's time for me to look for another option. If you're a startup founder and your service is down in the morning for an hour, no big deal. If it goes into the afternoon, now you got a big deal. People start looking for other solutions.

• 5:28Speaker 01

  When AWS in their US East one region went down, everyone kind of lost service. If you lose service with everyone else, Jason, is the penalty just not that high for your individual company? Cause that's good news and better than I expected.

• 5:40Jason Calacanis?

  If it was AWS, everybody gives you a million. No big deal. No harm, no foul. Now, you might, if you're a financial services company, you know, if you're a Robin Hood or you're Stripe and you go down and it costs people money, that's a whole different ball of wax. You might need to give a credit, you know, and things can get, um, yeah, a little bit ugly. People lose money. If you are selling pay-per-view and it's Netflix and it's that boxing night. Yeah, that is a big problem. So I think it, you know, it's service dependent. The financial companies have a different order of duty. But you know, if you look at the video game industry, they'll be like, hey, we're having downtime Saturday afternoon.

• 6:22Jason Calacanis?

  You can't play your game for three hours, expect downtime, and they communicate to you ahead of time.

• 6:26Speaker 01

  I don't mind that, but like, you know, Tuesday morning. I mean, I think Claude Flair likes to say they they power or protect about 20% of the websites online. That's that's a pretty big chunk of the internet to bring down yourself. Going back to what you said about their footprint and how they help protect websites from DDoS attacks. And they do content delivery around the world. Cloud Flare just bought a company called Replicate, Jason, and this is the startup that I hadn't spent enough time looking at. Raised a couple of rounds, including a series A from Andreessen and a series B from Andreessen. And what's interesting is they're kind of offering serverless AI access. So if you want to just basically not deal with an individual provider of AI services, you could go to replicate.

• 7:07Speaker 01

  And just kind of via one API hook, access a bunch of different AI models and they handled all the technical backend. And so it kind of makes sense to plug that into Cloud Flare's global infra footprint. Because then you can kind of have AI at the place of your consumers with limited lag and so forth. But like, is it kind of crazy that I didn't really know anything about replicate before this and it raised several rounds? How many companies are there doing this sort of thing?

• 7:34Jason Calacanis?

  This is a company I'm not aware of either, but yeah, being able to use an API to just send something to a model and get a result back. Is kind of how people are running these systems now. Instead of you can run your your whole application on AWS or Azure or Google Cloud, Oracle Cloud. And then just be calling APIs from Grok, Claude, you know, Anthropic or ChatGPT. That does make it a lot easier, doesn't it? You don't have to like stand up a bunch of hardware. You don't have to stand up like a bunch of instances. So it has become quite modular. I do think at a certain point in time, people are going to want to stand up their own.

• 8:19Jason Calacanis?

  Uh, language models with their own data to just not educate other L L Ms and to keep their data private. So I think the future is going to be, you know, a lot of people are running their own deep seek instance, you know, over at a Google Cloud or Really? etc. Yeah, I do think I I'm just seeing it with startups. Let's say you have a startup that does some obscure thing like, I don't know, building codes, right? Sure. And you're going to fine tune this model to do building codes and it's going to be for architects and builders, developers to understand all these different codes on a global basis. You know, your Starbucks, you're opening stores everywhere.

• 9:02Jason Calacanis?

  You need access to all these codes and you're taking all the time to go collect that data and to normalize it and train the model. Do you want to train? Chat GPT's model or Anthropic's model, have them get the benefit of it? Or do you want to just create an island, put all your data into it and not have them see the prompts, not have them learn from your prompts, not have them learn from what are the queries you're sending from your customers to them? Uh, I think people are going to become very, very cautious about the large language models becoming competitors. And I said it before on the show. Everybody listening to me knows it's going to be a big end of the year, November and December. You're trying to get a lot of

• 9:46Jason Calacanis?

  things done at work, but Thanksgiving is coming, Christmas is coming and you're going to need some help gifting and hey, getting ready for your Thanksgiving table and we've got the perfect partner. My favorite, Goldbelly. Mmm, yum, yum. Get yourself some amazing gifts for your partners. Get some amazing food for your table like Martha Stewart's salted caramel chocolate cake. How about this? John's of Bleecker Street, New York style pizza. Amazing. Lombardi's Pizza. These are some of the best pizza makers in the world. It's a great way to reward your team members. I do it. I order great stuff from around the country, uh, just surprise my team with it when we have team meetings. So if you're looking to reward your team for doing a great job in

• 10:28Jason Calacanis?

  2025, maybe you want to surprise your loved ones with a special holiday treat. Here's how you do it. You go to goldbelly.com, use the promo code TWIST and you get 20% off your first order. That's goldbelly.com and use the offer code TWIST.

• 10:44Jason Calacanis?

  Some of them are positioning themselves as like neutral third parties. They're not going to be in your business. Other ones, you know, that have to spend a trillion dollars. Quite possible they need to make $2 trillion. How are they going to make that money? I think they're going to compete with you. So for the startup that was working hypothetically in building codes and they took the time to go find all these building codes. Let's say they hired 100 researchers to, you know, full time for a year and they spent $10 million on these 100 researchers to go collect all this information, normalize it, whatever. And then they feed it into somebody else's language model and now they learn this information. Not good.

• 11:24Speaker 01

  So in that case, Jason, the corollary, the follow-up question is just, are the startups that you're seeing that are kind of rolling their own models, are they using, I presume, all models from China? Then the open source stuff from your moonshots, your deep seeks, et cetera?

• 11:38Jason Calacanis?

  I think this is the year this is happening. So TBD. But well, you know, let me ask a couple of them if they're willing to talk. So producer Marcus, like maybe we should see if there's somebody in our portfolio who's doing this. We can just ask in Founder University, et cetera, anybody working on open source AI models and training themselves and running themselves. And maybe they can come on the show and talk a little bit about it. But it is definitely a trend that's going on. And I saw Andreessen Horowitz was publicly saying, hey, a lot of our startups are using deep sea. So.

• 12:10Speaker 01

  That's what I was going to say. Martin Casado, I think, said that it's like 80% of startups they see are using open source models from China.

• 12:16Jason Calacanis?

  They're probably using other models as well, by the way. It's just.

• 12:20Speaker 01

  Not exclusively, but I mean, like, you know.

• 12:22Jason Calacanis?

  I think that's how people took that quote, though. People took it as like, oh, they're picking the open source Chinese model over OpenAI's model. I think it's in addition, or maybe they're experimenting with them. So in other words, they're aware of them. They've got an instance running and they're sending some jobs to it. And why wouldn't you? I mean, I think ultimately what's going to happen is we're going to have a large language model on our Mac mini M17. If it's an M, I think I have an M4 right now and I guess someday I'll have an M5, you know, somewhere around M10. You know, I'm going to have four M10s or an M10 will have four microprocessors in it and

• 13:03Jason Calacanis?

  some amount of bandwidth and RAM that will give it the ability to run my language model locally. Then when I do that search and I say, hey, show me all the photos of us skiing and, uh, you know, a bulldog in the background because I'm looking for those pictures of the bulldogs playing on the mountains while we're skiing. Uh, it's just going to do that locally, not in the cloud. It's going to index my photos locally. It's going to have all my Gmail local. It's gonna, you know.

• 13:28Speaker 01

  So do I then have like a server in my basement, Jason, that has like my family collection of GPUs? Or am I just running a single Mac mini pro 2015 edition or 2030 edition, whatever?

• 13:40Jason Calacanis?

  I think that the ultimate manifestation of all this is going to be, Apple will have local language models and they'll be pitching us on they're encrypted, they're private, your data's safe, just like they do for iCloud. We can't get your iCloud stuff. If the government comes and asks us to crack it open, we can't get there. Just like, you know, I guess Sam Altman gave a warning like, hey, if somebody sends us a letter, we're sending them everything you've talked about. And when this kid tragically committed suicide recently, they had all the logs, right? Like,

• 14:15Speaker 01

  Yeah.

• 14:15Jason Calacanis?

  They're going to dump the logs. So if you're in a relationship with chat GPT, you know, they have all that. Whatever you said to your chat GPT, they've got it stored.

• 14:24Speaker 01

  But the Apple point's great though, Jason, because if you wanted to have that model succeed, you would need to have a smartphone, a desktop computing experience, a slate computing experience, a headset computing experience, a future glasses computing experience, and you need to be in cars, perhaps do something like CarPlay. They literally have all the surfaces already that they would need.

• 14:43Jason Calacanis?

  Whoever has the operating system, I think is going to have a real, operating system plus privacy is going to be a really interesting combination. I've talked ad nauseam about my love of the Comet browser and watching my browser, you know, go to United Airlines and find a flight for me and put it into. You know, the shopping cart was like, hmm, that's interesting. Or I used it the other day. I said, go to Blue Sky because I don't have, I'm not following any on Blue Sky. And I just said, I think I said, follow anybody on the explore page. Who's like featured, just follow like 200 people and it went and followed like 20 people. It's like, ah, 20 is the limit. And I was like, why is 20 the limit? Okay, do it five times. It went, did it five times.

• 15:26Jason Calacanis?

  The idea that Apple is watching what you do on your phone. And there's this give Apple intelligence. I don't know if you've seen this setting, you can pull it up.

• 15:36Speaker 01

  We've talked about this, yeah.

• 15:37Jason Calacanis?

  Give Apple intelligence access to what you're doing on this app. So if you go to the settings for any app on your phone, there's a thing like give Apple intelligence access to it. What does that mean? What that means is Apple intelligence is watching how you use your phone and they're watching how you use, I don't know, the contacts app, your phone app, your superhuman app. And then over time, you're going to be able to say, go do this in the StubHub app. Go find Knicks tickets, but it will have recorded and studied it over and over again.

• 16:13Speaker 01

  People asked online quite a lot about how to turn this off. But to me, if you're going to use any sort of intelligence on your iOS device, you're going to want it to connect into other applications, Jason. So just.

• 16:22Jason Calacanis?

  So Apple Intelligence, yeah, learn from this app.

• 16:25Speaker 01

  Next on the docket, we have Grok 4.1. We'll talk about Gemini 3 in a second, but I think it's worth stopping and saying, look at what XAI did. Because this is a company, Jason, that started later than OpenAI and has really done, I'm just going to say, impressive things. I know a lot of my friend group aren't the biggest Elon fans, but I do think it's important to give credit where it's due. And Grok 4.1 is really good across a number of metrics. One, they did a lot of work on reducing hallucinations, which I think is a very important step. Compared to Grok 4 fast, it's dramatic improvement. And I think most importantly, based on the usual kind of panoply of things that Ella Marina tracks in its battleground for different AI models, when 4.1 was released onto the charts.

• 17:10Speaker 01

  Observe, it went straight to the top. Grok 4.1 and Grok 4.1 thinking took the absolute pole positions. But this is a real accomplishment. And I think it just shows that there's several different AI labs here in the US that are able to successively create state of the art models. And I think that's very encouraging for startups. I think it's encouraging for the AI economy writ large. And I think it also pushes back, Jason, against some of the the doomerism that's been kind of building in the last three months. It feels like AI needs a win, and I think this is an example of such a win.

• 17:40Jason Calacanis?

  Less hallucinations, obviously, better. And one of the great things is, I guess, that now that we have these leader boards, it's motivated all these companies and gotten these teams super excited about claiming the top spot. So yeah, kind of cool that these things, you know, somebody came up with this, this concept of the arena and all these different tests. I do wonder if building for the tests at a certain point is kind of like kids mastering the SATs and like at a certain point, maybe that's not what's important. Maybe like there are other things. So I wonder if these tests are changing.

• 18:22Jason Calacanis?

  I don't have enough information on that of like, how are these tests changing? I know early on, some of these, one of the tricks that was occurring is when you give people an incentive like a leaderboard like this, people then try to game the leaderboard. What's a way to game the leaderboard? Doing unnatural acts like if you know it's going to ask certain types of questions, then studying for those types of questions or feeding those exact questions or those, you know, multiple versions of those questions into your training set. In other words, kind of gaming the system.

• 19:00Speaker 01

  Precisely.

• 19:01Jason Calacanis?

  And, and I think that that's where I'm just getting a little concerned of, you know, like, are we actually making progress at solving the real world problems people have? Or are we getting good at acing the SATs? And that is a question for me.

• 19:16Speaker 01

  There's people are worried about, I'm trying to remember the exact phrase of this, but it's like diffusion or when the model gets like so suffused with people knowing how it asks questions that it kind of loses meaning because you can tune. And if you think back to Meta's launch of Lama 4, Jason, if you recall, they actually made a bunch of different versions of Lama 4 and then ran them through the team test to get the best results and they got mocked for this pretty mercilessly because it was clear they were trying to cook the numbers to appear impressive. The reason why I shared Ellen Marina information versus just kind of a raw rundown of individual benchmarks is that this is their users in a head to head battle, choosing which result is better with the model names masked. And so it shows what people that are actually using these models think. And I, I'm hoping that provides a better perspective on, on actual progress here.

• 20:01Jason Calacanis?

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• 20:45Jason Calacanis?

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• 21:15Speaker 01

  But anyways, let's move on to this morning's big news. Similar idea, new AI model, this time from Google. Gemini 3 Pro is out. Limited early access. It's rolling out as we speak. Earlier, Jason, you mentioned how the benchmarks are a little bit dodgy. So I don't want to overindex on this particular data set, but I think it is worth just sharing with people what the numbers show. So here's the Gemini 3 Pro benchmark results. I just wanted to talk about the difference in how things have changed. If you look at their humanities last exam results, Claude's on a 4.5 gets about 14% right versus about 38% for Gemini 3 Pro. Big improvements

• 21:54Speaker 01

  in math and screen understanding. And these numbers really are materially better than other models that are kind of currently state of the art. And I just really think this pushes back against the idea that AI improvement has slowed dramatically. So I view this all as very, very bullish. And there's a little bit of a teaser, though. One last thing here. If you take a look at this chart right here, there's an upcoming variation of Gemini 3 Pro called Gemini 3 Deep Think does even better and is crushing the ARC AGI benchmark, which I think is very important. So I believe the kids say that Google cooked here and that a lot of folks are really going to dive into this pretty much right away because this is going to be

• 22:39Jason Calacanis?

  Looks incrementally better. You know, to be honest, we need to have an expert on here to tell us if it's actually better or not, or like the actual extent. Because this history's last exam, I do know, having talked to some folks, like they are some pretty hard questions. I would like to like have an expert on here who created that. I wonder who created histories. Somebody created this. Somebody creates the new questions on it. I want to know who that person is.

• 23:04Speaker 01

  In a more real world application than Jason, to put it into more kind of functional context, browser use, it was 500 company gave it very strong marks. It said it was much better than previous models from the company. Box is Aaron Levie compared it to Gemini 2.5 Pro and found that in the box context was much better across a number of metrics. And Stripes Patrick Collison gave it pretty strong review. You might say he gave it a pretty hard task and was very impressive when it put out when they put together a compendium of recent research into genetics. So

• 23:32Jason Calacanis?

  So some people in the field are actually reporting. That's good to know. Got rave reviews from some leaders who actually use it.

• 23:40Speaker 01

  Yeah.

• 23:41Jason Calacanis?

  At their major company. So Aaron Levie likes it. Stripe boys like it. That's pretty good endorsement that they're seeing a difference.

• 23:48Speaker 01

  It's at least as good as people hoped, unlike GPT-5, which was not as good as people hoped. So at a minimum, the vibes are persisting. So that's pretty good. And then just for fun, Jason, I thought we talked about the the poly market perspective here. There's a funny little wiggle here in this poly market. If you're on the audio version, we're looking at which company has the best AI model by the end of 2025. The end date, of course, is December 31. And there was this really interesting wobble, Jason. We're zoomed into a one day context here. But look, Grok 4.1 came out. People got really excited about it. Maybe XAI is gonna win. And then Gemini 3 came out and got crushed again. So the market is once again betting that Google's gonna run the AI game through the end of 2025.

• 24:25Jason Calacanis?

  How does this one resolve? I always bring the same thing up, which is we need to understand how the bet resolves. So how do they define which one has the best AI model again?

• 24:37Speaker 01

  The market will resolve to yes, if any model owned by Google has the highest arena score based off the chatbot arena LLM leaderboard. So it's the chatbot subset of the LLM arena leaderboard that we discussed earlier. Again, head to head, no models listed. People just pick which one they think is best. So it's kind of a blind taste test and Google has to have the highest score in that area. And it didn't when Grok 4.1 came out. And now it does again, now that Gemini 3 has come out and surpassed it.

• 25:03Jason Calacanis?

  That means Google is gonna have the best model, period, full stop. Like if the sharps are saying it, there's somebody on the inside who's making this bet, I bet. I bet there's people inside the, there's some group of developers. This is my hypotheses. There's some group of developers who run LLM arena. And there's people inside of Google who are betting on themselves like a basketball. It'd be like Michael Jordan betting on himself to win a game or cover the spread. It's like it's in his control. So when I see like every that that sort of level of consensus, I kind of think it's the developers themselves

• 25:43Jason Calacanis?

  working on the language model or the person and/or the people who actually run the leaderboard who are watching the leaderboard activity and they have some inside information. This is why these, you know, poly market is like really changing the world. Because there's an opportunity to make money from your knowledge. People have some proprietary knowledge, some inside line, or they're in control of it. But this is what makes these things so interesting.

• 26:15Speaker 01

  Do you want to see a funny little addition then, Jason, while we're talking about this?

• 26:18Jason Calacanis?

  Sure.

• 26:18Speaker 01

  If you pull this, if you look at this, this is the same chart, but zoomed out to the entire year for this kind of end of year bet. And you can quite literally see people's enthusiasm for GPT-5. And then it came out and just collapsed its percent chance of being correct. So not everyone trading on here has inside information because some people are still reacting to news as it comes out to the public. But you can make a lot of money if you know what's going to happen before everyone else. You can see right there.

• 26:42Jason Calacanis?

  I think I'm with them. It does seem like Google is going to run away with it for this year. And they also have this massive advantage with their profit machine and the number of searches growing. They can build out their capex.

• 26:57Speaker 01

  Yep.

• 26:58Jason Calacanis?

  Off of profits. And so that also gives them a massive advantage in all of this. And it makes sense. They bought DeepMind back in the day and they can just keep using all the data they have from browsers, Gmail, YouTube. I mean, you think about their data advantage. Gosh, what is, and have they come out with an agentic Chrome browser yet? Have, has there been any rumor about them releasing an agentic Chrome browser?

• 27:26Speaker 01

  I think they're taking the same approach to adding AI to Chrome as Microsoft is with Windows, which is trying to slap it on the top so they don't disrupt what currently works. And I think that's why they're ripe for disruption. I know there's plugins and extensions. I don't think there's a hardcore agentic Chrome version, Jason, or at least I, no, I don't think there is.

• 27:44Jason Calacanis?

  Gemini is in Chrome, like in the top, there is like a Gemini button.

• 27:50Speaker 01

  Yeah.

• 27:51Jason Calacanis?

  That will like, I don't know, summarize the page you're on and do basic stuff like that.

• 27:56Speaker 01

  I'm not playing with this, this, okay, this is better. I never actually clicked that button until now, so sorry if I'm behind, but like, I don't think I ask, okay, you see, you can chat to Gemini inside of Chrome about your current page and you can change the tab. But this seems kind of bolted on to me and not as, as deep of an integration as we've seen with Comet, Atlas and other browsers.

• 28:17Jason Calacanis?

  Yeah, I think they'll do like some basic things like create a calendar event for you.

• 28:24Jason Calacanis?

  But I don't think you can have it go. Do a task for you like Comet does. Where you could say like, hey, go find me 10 camping. Put 10 camping supplies I should have for my camping trip this weekend into my, um, you know, shopping cart and give me two versions of each flashlight, two versions of each sleeping bag, and I'll delete the one I don't want. Give me the highest rated and average price. And I think those are the kind of features people are going to be looking for. But integrating with like, you know, summarizing your YouTube video or making a calendar event. I guess those are nice. But when they, if, if they are studying everything you do inside your browser,

• 29:08Jason Calacanis?

  we're talking about Apple Intelligence earlier, studying how you use an app. Now I think about that with your Chrome browser plus your Gmail. They're going to know everything you shop on Amazon. So then they could, every time you're, this would be super aggressive and probably trigger some anti-trust stuff. But imagine if they were studying your purchasing and then just taking that into account with an AI agent for like, hey, I can build your shopping cart for you for your groceries next week based on, you know, what I've seen you do in the past, right? I, I think you're going to be out of milk. I think you're probably needing more eggs. It'll be very interesting. Your startup needs custom software, but building your own secure, production-ready apps is hard, right?

• 29:51Jason Calacanis?

  And not every founder has the expertise or time to get started. Well, now you don't have to. Just use Zeit, Z I T E. Make whatever you need from idea to a working app in just minutes, easily, all on your own. Plus, you can fill it in with forums, apps, databases, and other automations that you need as part of your product. So many of the no-code and vibe coding tools are just flashy demos, where they work on legacy systems that take so much time and effort to learn, let alone master. But Zeit is both easy to use and powerful enough to build out the apps you want. And it quickly connects all the other tools you're already using. For example, earlier this month, they added the ability to bulk create and update records. So it's easier and faster than ever to design data-heavy apps that are constantly syncing between systems.

• 30:35Jason Calacanis?

  That's the kind of attention to detail that sets Zeit apart. Start using the number one AI-powered business software generator on the market. I'm going to give you 50% off your first project. Go to zeit.com/twist to get started. That's zeit.com/twist for 50% off your first project.

• 30:55Speaker 01

  We just did confirm, Jason, that the current instantiation of Gemini in Chrome is non-adjunct. I bet you if you count to like 35, they're going to update that because even Edge, Microsoft's current browser, has the same kind of right rail agentic interface. That's very similar to, again, Atlas and Comet from Perplexity.

• 31:15Jason Calacanis?

  Yeah.

• 31:16Speaker 01

  I'm speaking about data and which companies have it. Microsoft has a lot of data because they run, of course, the Office suite and have for 1,000 years and they are going to invest in Anthropic. This is the other enormous AI news story from today. Both Nvidia and Microsoft are going to invest into Anthropic, up to 10 billion from Nvidia, up to 5 billion from Microsoft.

• 31:37Jason Calacanis?

  Wow.

• 31:38Speaker 01

  Also, yeah, also, Microsoft is going to become a compute provider for Anthropic. So you're going to be able to use Anthropic's Claude models inside of the Azure ecosystem. And they're going to buy compute from Azure as well. So it's kind of one of these classic AI multi-part deals in which Microsoft's going to work with Anthropic and invest in it. Anthropic's going to work with Nvidia to ensure that its models can run efficiently on Nvidia GPUs. And everyone's very excited about this. This is going to be fun. Now, no matter what cloud you're on, Google Cloud, Azure, or AWS, you can get access to Claude models. I think it's the first AI company to be available on all three major clouds, which I think speaks to their business focus.

• 32:19Jason Calacanis?

  They're very much don't want to compete on an application level with their customers. They want to be a neutral third party, although they do have a coding product. I think they're not going to do what OpenAI is going to do, which is try to, you know, invest in every single space. But Microsoft investing 5 billion after just settling their OpenAI deal, I think that's probably why this is happening now.

• 32:48Speaker 01

  Yes.

• 32:48Jason Calacanis?

  Is the OpenAI deal closed and they seem to have worked that out, that they're going to go public and they have certain ownership. And now...

• 32:58Jason Calacanis?

  This drops, Microsoft investing $5 billion, Anthropic will use 30 billion worth of Azure compute potentially. So that's pretty amazing. And you know, these contracts are now starting to say, we'll invest up to. So I think people want to understand the contours of these deals a little bit more, Wall Street, that is. And so now you're starting to see that those qualifiers come in, up to 10 billion, up to 5 billion. Although they, here in the notes, it says they're going to purchase 30 billion worth of Azure. I wonder if that is actually locked in, or that's based upon, you know, certain targets being hit. But that's kind of big news.

• 33:38Speaker 01

  Anthropic has committed to purchase 30 billion of Azure compute capacity and to contract additional compute capacity up to 1 gigawatt. That's pretty sturdy language.

• 33:47Jason Calacanis?

  To my point, like, I think you're starting to see more precise language in these deals, because people are wondering, like, is this going to actually show up or not? So when they put up to, and they put committed, like, there might be, there could still be an out in that, by the way. They committed to this amount, and there could be caveats. If, you know, they can cancel this, they could push out this spend. So, you know, it could occur over 10 years, it could occur over 20 years. There's, you know, all kinds of contours and qualifiers being put on these things.

• 34:20Speaker 01

  These companies want each other to succeed. So I don't think they're going to be so hard-nosed about individual contractual things that they're going to cause a ruckus. Like, Microsoft doesn't want Anthropic to look weak, nor does Nvidia, well, Microsoft to look like it made a bad deal. They want everyone to look brilliant and profitable, and then there's just revenues raining from the sky. So I kind of presume there's some goodwill built into these, Jason. Maybe I'm being naive, but.

• 34:41Jason Calacanis?

  Um, you know, if they are making commitments to buy a certain number of Nvidia's chips, well, Nvidia needs to actually make those, so there could be outs. They're time-based, obviously. So the nature of these is a rising tide lifts all boats, and. We need more power, more GPUs. But Dario was also on 60 Minutes this weekend, and there was an interesting clip of him talking about white collar jobs. And it was exactly in line with some of the reporting I've had. He basically is saying, for the early stage,

• 35:22Jason Calacanis?

  and I'll summarize it, but he's concerned that rote work in the next couple of years, in the short term, it's going to be really cataclysmic. And he just kind of comes out and says it, which is refreshing. Let's hear the clip.

• 35:38Speaker 02

  You've said AI could wipe out half of all entry-level white collar jobs and spike unemployment to 10% to 20% in the next one to five years.

• 35:46Speaker 03

  Yes.

• 35:47Speaker 02

  That's shocking.

• 35:48Speaker 03

  That is the future we could see if we don't become aware of this problem now.

• 35:53Speaker 02

  Half of all entry-level white collar jobs?

• 35:55Speaker 03

  Well, if we look at entry-level consultants, lawyers, financial professionals, you know, many of the white collar service industries, a lot of what they do, you know, AI models are already quite good at, and without intervention. It's hard to imagine that there won't be some significant job impact there. And my worry is that it'll be broad and it'll be faster than what we've seen with previous technology.

• 36:23Jason Calacanis?

  This is interesting because he's pretty concise. Again, back to contours, qualifiers. He thinks this could be 10% unemployment. Now, we've had 10% unemployment quite recently amongst young people. It's 8% right now coming out of college. So saying 10% to 20% is basically not that 4% number you'll hear me quote all the time. That's like the sort of national. But amongst young people, unemployment is like 8%, 9% already. So going to 10% to 20% is not that big of a jump. This is the unemployment rate amongst 16- to 24-year-olds. And you can see... What's that?

• 36:58Speaker 01

  Climb from the bottom of 6.6 in April of 2023 to a high of 10.5% as of August. Recall government shutdown, data delays. That's the most recent data.

• 37:08Jason Calacanis?

  Yeah, so it's already at 10% amongst the 16 to 24 group. The higher group, which is like, I think 20 or 27, I think it's 8% or so. That group is an important one to look at because that includes like the college grads who've been in the market for a couple of years. The point is, what he's saying is not far fetched and it's not doomerism. It's actually really well thought out and you will hear people dismiss it as doomerism. And the people you hear maybe dismiss it as doomerism, maybe they have horses in the race, maybe they have political agendas, etc. And they don't want people to be as matter of fact about this. But he is exactly right.

• 37:52Jason Calacanis?

  If you were to look at an entry level PR person or an HR person or an entry level researcher, entry level apprenticeship level, accounting person or legal person. A lot of what they do is a drag on the senior people. And the senior people are now able to do that young person's grunt work with AI. So then you have to ask yourself, if you're a senior level person, do you want to mentor, you know, these two or three annoying kids? Who are just learning how to like show up at work on, and they can't even get in on time or they're goofy and they fool around or they do some stupid stuff at work. Like, everybody's had this experience, like mentoring people is hard. It takes time out of your day. Some people find it rewarding, most people find it annoying.

• 38:36Jason Calacanis?

  Sorry, it's just the reality of it. And then, you know, you could just have run a query with your LLM or use your copilot from a legal provider, a tax provider, a coding provider. Or, you know, if it's an HR person and they're like, I'm going to put people on recruiting for these new positions and writing the job descriptions. Then I've got to go edit the job descriptions. It's just easier for me to do it myself. You take a senior person like yourself, Alex, or somebody like Lon. You know, you gotta prepare the docket. You have a young person prepare the docket. You edit them, it's like, ah, I could have just done this myself with a large language model and it would have been done already.

• 39:14Speaker 01

  I think we're gonna have to make a civilizational decision here because everything you're saying, Jason, is right. Often mentoring people slows you down, it burns time, and it makes the senior person who's more expensive, less productive net because they have to go back and do a lot of busy work. But if we want people to have kids, they're gonna need employment and stable employment is better.

• 39:32Jason Calacanis?

  And yeah, so you're thinking on a societal basis, but that's not how people work. That's not how business leaders work day to day.

• 39:40Speaker 01

  But maybe, that's what I'm saying, we need to change our mindset because if we do automate these jobs away and we take a lot of careers that should start right after college and begin to accrete value and income and therefore wealth and therefore the ability to buy a house and have children, if we short circuit that process at the beginning, we're gonna have a lot of people that are just 45 with two roommates and a shared dog.

• 40:01Jason Calacanis?

  Yeah.

• 40:02Speaker 01

  It's already happening.

• 40:03Jason Calacanis?

  Yeah.

• 40:03Speaker 01

  So, I mean, these conversations that people don't want us to have because they don't want us to, you know, tell people the truth about what's coming. I mean, who's offering, is anyone even trying to find a solution to this other than just throwing their hands up? Because I agree with you and it scares me.

• 40:18Jason Calacanis?

  It doesn't need to be scary. It should be concerning that smart people building in this space, Dario, Elon.

• 40:27Speaker 01

  Yeah.

• 40:28Jason Calacanis?

  Myself, not that I'm on their levels, but and Bernie Sanders and other folks are saying, hey, that is a little bit concerning and we should be thinking about it. Individual businesses are not going to think collectively. The government is like, they're, they're never gonna be able to like get in here and solve these problems. So what I'll say is you're on your own, young people, the message to young people, you're on your own, nobody's coming to help you and you gotta figure it out for yourself. That's my best advice because businesses are just gonna do what businesses do. Which is lower costs and be more efficient. They're going to adopt the technology. They are adopting the technology.

• 41:06Speaker 01

  Oh, quickly.

• 41:07Jason Calacanis?

  Yeah. And so they are not going to think about this overall society issues. Our government has never been able to manage any of this stuff. They never will. They're not going to do it. And it'll be like 10 years in the rearview mirror by the time they get involved. I mean, they're just thinking about breaking up Google's search monopoly in year 30. So they're out to lunch.

• 41:29Speaker 01

  Government moves slow, but what about making conscious decisions, like putting together a consortium of leaders of businesses and say, hey, we are not going to stop hiring young people. We are going to keep investing in the future generations because we would like to not only have a society in 50 years, we'd like to have senior people in 50 years. Like this, this is a thing that businesses could get together and choose to do if they wanted to.

• 41:50Jason Calacanis?

  I'm trying to figure out if that there's any precedent for what you're saying. It's idealistic, but these are competitive businesses. So it would be like during the, I don't know, the banking era saying like, oh, we're going to put in, you know, teller machines. Let's all the banks get together and we'll coordinate, you know, having more tellers to do more things, which eventually exactly happened. You know, you go inside the building and they, they had more services they offered other than just counting you money and giving you a deposit. They, they worked on other, they, they moved those people to work on other offerings, I think, in some cases.

• 42:23Speaker 01

  They often have, but it's different this time. The, the thing is, I don't think this is just another introduction of a specific technology that impacts one slice of one part of the, of the labor force. Like, like ATMs are automated teller machines. They automated tellers in a machine. Tellers were not 10 to 20% of the workforce. Right? So when, when Dario says this, and you say, he's right, and he's being upfront, we are implying that we are going into a great depression level of unemployment because we're going to automate away tens of millions of jobs.

• 42:53Jason Calacanis?

  I think it would be low millions of jobs. Um, I don't think it would be tens of millions, but I think it will be low millions per year will be automated away. So then the question is like, do we catch up with new work? Just start a company. Go to Founder University. I, I think nobody's solving these problems. I think it's going to be a tragedy of the commons kind of situation. Nobody's, you know, going to be looking out for the interns and the apprentices. They're just going to adopt the technology, go faster, lower their costs. Amazon's just going to be a machine. They're not going to like think collectively about anything other than faster deliveries at a cheaper price.

• 43:32Speaker 01

  Then you better get accustomed to Mondami winning in New York City. Because, because, because what you're saying here is that there's no way for businesses to look out for their own interests. And that, that's surprising to me because you're saying essentially it has to be such short-term thinking. They can't think long-term and that's an indictment of the capital formation process.

• 43:49Jason Calacanis?

  They can't think collectively. They can think midterm, long-term, but there, it's not like Amazon's going to go, you know what? We need to keep adding staff to do this instead of robots so that our staff can buy stuff on Amazon or can go to Starbucks on their way to work. They just, that's just not how businesses think. They're just going to be radically pursuing efficiency. Now, the question is, do people want to create more companies and products and services using these new tools? If you know these tools, you're going to be infinitely employable. And that's the best advice I can give any young person who is going to be faced with, you know, 15% unemployment amongst their peer group.

• 44:30Jason Calacanis?

  I think it would be 15%, which I, I think when I graduated college in 93, I think I remember 14 or 15% unemployment amongst that 20 to 27-year-old. If you look at that.

• 44:43Speaker 01

  Okay, here's the 20 to 24-year-old unemployment rate historically.

• 44:48Jason Calacanis?

  Okay, that's interesting. That's like really graduates. If you go to the 93, it was like 12%.

• 44:53Speaker 01

  It was just starting to decline from about 10 and then it fell consistently down to six.

• 44:58Jason Calacanis?

  Right when I was graduating, it was over 10%. Now it's at under 10%. It could be faster, as he's saying, than people anticipate.

• 45:06Speaker 01

  If it's not faster than he's anticipating, then we're spending too much on AI. And if it's going to go as fast as he says it is, we're going to end up with socialists running every single major city in this country. So something for business people to think about as they approach productivity.

• 45:19Jason Calacanis?

  So we're going to host our dim sum demo day in San Francisco. We'll have. Our latest accelerator class, maybe I'll do a fireside chat with one of my friends or besties. And we'll eat some dim sum and it's just going to be great networking for investors. I'm going to invite 150 investors. Everybody from my high net worth LP base, the syndicate members who like to write 10 to 50 K checks into startups. As well as all my seed fund and venture friends in Silicon Valley. You can apply to come if you're an active investor. You have to be an active investor because there's only going to be like 150 seats, I think, or even 100.

• 45:58Jason Calacanis?

  There's no room for, you know, friends to just hang out or other founders to hang out. You have to be an investor. You have to be able to prove your investor. You can apply launch.co slash dim sum, D I M S U M, launch.co slash D I M S U M, dim sum.

• 46:14Speaker 01

  So jealous. That's gonna be so much fun. I loved in some, I loved in some in San Francisco and I love me some nerds. So that's like my three favorite things.

• 46:20Jason Calacanis?

  It's going to be in San Francisco area. I like to make it like, you know, these demo days, I think 70% of the value is to get to catch up with other investors candidly. And then 30% is to get to see the companies and get to meet them. So there's the reason to come. If you want to fly into San Francisco, you got a reason to do it December 5th. And I think December 6th is the all in holiday party. If you happen to be coming in for that. Awesome. And that'll do it for us today.