NVIDIA Earnings Breakdown | Doug O’Laughlin, Ajay Agarwal, Koen Bok & Jorn Van Dijk, Hussein Fazal, Oisin Hanrahan, Jon Callaghan, Shane Hegde

(00:11) - NVIDIA Earnings Breakdown (28:43) - Doug O’Laughlin is the President of SemiAnalysis, an independent research firm focused on semiconductors and AI. He specializes in semiconductor strategy, market intelligence, and competitive analysis, regularly guiding investors, technology companies, and policymakers with his insights. (01:12:05) - Timeline Reactions (01:58:28) - Ajay Agarwal, a Partner at Bain Capital Ventures, has been with the firm since 2003, focusing on early-stage application software and SaaS investments. In the conversation, he discusses his journey from leading sales and marketing at Trilogy, where he grew annual revenues to $300 million, to his current role at Bain Capital Ventures, emphasizing the importance of software innovation and network effects in building successful companies. (02:30:55) - Koen Bok & Jorn Van Dijk, CEO & Co-Founder of Framer, a professional web design platform, discusses the company's recent Series D funding announcement, highlighting their mission to enable designers to ship websites without relying on developers. (02:41:29) - Hussein Fazal, co-founder and CEO of Super.com, discusses the company's rebranding from SnapTravel to Super.com, emphasizing their focus on providing a membership program that offers customers savings on hotels, gas, insurance, and more. He highlights the company's growth, surpassing $200 million in annualized revenue, and the challenges faced during the acquisition of the Super.com domain, which involved intense negotiations and a significant investment. Fazal also shares insights into their customer acquisition strategies, emphasizing the importance of product-specific channels and the role of AI in personalizing user experiences. (02:50:58) - Oisin Hanrahan, co-founder and CEO of Keychain, previously co-founded Handy, a home services platform acquired by Angi, where he later served as CEO. In the conversation, he discusses Keychain's mission to streamline the consumer packaged goods (CPG) supply chain by connecting brands and retailers with suitable manufacturing partners through an AI-powered platform. He highlights the platform's success, noting that eight of the top ten U. S. retailers use Keychain, and mentions a recent $30 million funding round, bringing their total raised to $60 million. (03:01:07) - Jon Callaghan, co-founder of True Ventures and former Chairman of the National Venture Capital Association, has been a venture capitalist since 1991, with a background in founding three companies. He discusses the evolution of venture capital, emphasizing the shift towards capital efficiency and the ability of founders to achieve more with fewer resources. Callaghan highlights the unprecedented opportunities in the current market, particularly in AI, and underscores the importance of empowering entrepreneurs to take bold risks without fear of failure. (03:16:08) - Shane Hegde, CEO and co-founder of Air, discusses how Air serves as a system of record for creative work, enabling teams to efficiently manage and automate their creative operations. He emphasizes the importance of understanding and meeting the expectations of creative professionals by delivering a product that aligns with their needs. Additionally, Hegde highlights Air's strategic focus on content marketing and culture-led growth to effectively reach and engage their target audience. TBPN.com is made possible by: Ramp - https://ramp.com Figma - https://figma.com Vanta - https://vanta.com Linear - https://linear.app Eight Sleep - https://eightsleep.com/tbpn Wander - https://wander.com/tbpn Public - https://public.com AdQuick - https://adquick.com Bezel - https://getbezel.com Numeral - https://www.numeralhq.com Polymarket - https://polymarket.com Attio - https://attio.com/tbpn Fin - https://fin.ai/tbpn Graphite - https://graphite.dev Restream - https://restream.io Profound - https://tryprofound.com Julius AI - https://julius.ai Follow TBPN: https://TBPN.com https://x.com/tbpn https://open.spotify.com/show/2L6WMqY3GUPCGBD0dX6p00?si=674252d53acf4231 https://podcasts.apple.com/us/podcast/technology-brothers/id1772360235 https://www.youtube.com/@TBPNLive

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

• 0:00Jordi Hays?

  You're watching TVPN.

• 0:02John Coogan?

  Today is Thursday, August 28th, 2025. We are live from the TVPN Ultra Dome, the temple of technology, the fortress of finance, the capital of capital. Nvidia earnings were yesterday, they hit consensus estimates both on earnings per share and revenue, but the stock, the stock sold off in after-hours trading, wasn't bullish enough. The whispers were that maybe something even crazier was going to happen, but this business has been on a tear. The quarterly revenue chart is absolutely insane, one of the craziest charts I've ever seen in business, and the pricing power is unrivaled. The gross

• 0:44John Coogan?

  profit margin per fiscal year is insane. They're up in 75%. So fantastic business overall, but of course, the question is, where does Nvidia go from here? Where is the, where is the business? We can read from the Washington Journal, it kind of give you the headlines.

• 1:06Jordi Hays?

  It's rough, it's rough when it, when a business announces a $60 billion buyback and everybody's screaming, bearish, that, that's bearish.

• 1:13John Coogan?

  Yeah.

• 1:14Jordi Hays?

  We're giving profits back to shareholders.

• 1:17John Coogan?

  Yeah, we have, we have an extra $60 billion sitting around because we're doing so well and everyone's like, boo. It's crazy. Grow faster. Nvidia set fresh sales records on Wednesday as the world's most valuable company publicly, world's most valuable publicly traded company continued to capitalize on strong demand for AI computing power. Sales hit 46.7 billion, up 56% from the year earlier, in line with revenue estimates from analysts. Revenue from the important data center segment, which includes sales of the company's most powerful chips used to train and refine artificial intelligence models, rose 56% to 41.1 billion, and this was slightly lower than what analysts expected at 41.3. And so that's probably

• 2:01John Coogan?

  what was driving the, the, the market moving in the after hours.

• 2:04Jordi Hays?

  The jitters.

• 2:05John Coogan?

  Because that should be the, that should be the strongest place of growth is the data center business, whereas, you know, if gaming was selling off, or they have some automotive businesses, they have a variety of other products. The vast majority, I think 90% of the revenue almost is from data center. And obviously, that's been the huge driver and the huge narrative.

• 2:25Jordi Hays?

  We're actually going to pull up a quick graphic right now of Jensen for you guys. In case you haven't seen him.

• 2:32John Coogan?

  Oh, yes.

• 2:33Jordi Hays?

  Yesterday.

• 2:34John Coogan?

  Looks great.

• 2:35Jordi Hays?

  Going head to head with himself.

• 2:37John Coogan?

  Yes, yes, yes.

• 2:38Jordi Hays?

  He's really, he.

• 2:40John Coogan?

  Market cap's 4.4 trillion, is that right?

• 2:42Jordi Hays?

  Hopefully.

• 2:43John Coogan?

  There we go.

• 2:44Jordi Hays?

  Yep.

• 2:45John Coogan?

  Quarterly net income was 26.4 billion, 59% higher than a year ago. The company predicted revenue of 54 billion for the third quarter, slightly higher than consensus. Nvidia shares fell about 2% because of a narrow miss of revenue forecast for its data center business. Surging demand from the fast growing AI industry is largely responsible for Nvidia's strong results. As software companies like OpenAI, Microsoft, Amazon.com, Alphabet and Meta platforms continue to train ever more powerful AI models. And so, there were a few numbers that stuck out from the earnings call. The big one that everyone was talking about was this prediction, this broad prediction of not specifically Nvidia's revenues,

• 3:30John Coogan?

  but of overall AI infrastructure spend, quote, "through the end of the decade", which is always kind of hard because does that mean you include 2030? Or do you stop at 2029? When does the decade really end? But most people are calling it five years, they're calling it the end of 2030. And the prediction from the Nvidia team was that we would see $3 to $4 trillion spent on AI infrastructure by the end of the decade. And so, I think that's supposed to be an aggregate number. He's not saying that in 2029, we will be spending $4 trillion on AI infrastructure per year. It's more that just over the next five years, we will see a total of $4 trillion, $3 to $4 trillion go out.

• 4:17John Coogan?

  My initial take was this sounds high, obviously, but how does it comp to situational awareness? Because

• 4:26Jordi Hays?

  Let's trust the experts.

• 4:27John Coogan?

  Yes, seriously. Leopold Ostenbrenner did a great job forecasting out the growth of AI capex, AI infrastructure spend. And so I pulled the numbers and 3 to 4 trillion is actually way lower than what situational awareness was estimating, which pegged 2030 at something like $8 trillion just in that year and maybe something like 15 trillion in total investment through the end of the decade. I think that includes some power spend as well. So the definitions, it might not be purely apples to apples here, but it's funny to frame Jensen as like bearish relative to Leopold, who's like super AGI pilled. And maybe Jensen's like, yeah, you know, I'm happy to

• 5:09Jordi Hays?

  The account Paulo Macro on X said, "Am I the only one thinking Nvidia is completely jumping the shark here with these kind of projections? I know AI people will swallow whatever, but seriously, only Elon could get away with this sort of talk, which is Nvidia expects 600 billion in capex for data centers in 2025 and 3 to 4 trillion in data center capex before 2030."

• 5:30John Coogan?

  Before 2030. Tyler, what you got?

• 5:32Speaker 02

  I was just gonna say, like, people have always kind of said Jensen is like not AGI pilled, like half jokingly, just because like, if you're super AGI pilled, obviously you wouldn't be selling the GPUs, you'd just hold on to them.

• 5:41John Coogan?

  That's a funny

• 5:42Speaker 02

  They're like the most important thing, so.

• 5:45John Coogan?

  Maybe, maybe. I don't know.

• 5:47Jordi Hays?

  Yeah, the

• 5:48John Coogan?

  I mean, I was talking to Jordi about this.

• 5:50Jordi Hays?

  Yeah, I mean, the other number that stood out is that Nvidia's revenue from Singapore keeps breaking all time highs, reaching 10.1 billion in sales this last quarter. It ranks second after the US and just behind Taiwan. Year to date, revenue from Singapore is approaching 20 billion. A lot of people had thoughts on this and kind of trying to

• 6:14Jordi Hays?

  Figure out.

• 6:14John Coogan?

  The like loose like accusation from like mostly anons is like, maybe this is someone who's smuggling into China, but Nvidia, the team made it clear on the, on the call, they used a very specific phrase to say that the, the, the company that was buying in Singapore had been cleared by the United States government. And so, you know, who knows, maybe there's something that has, that the government isn't aware of, maybe the government needs to revisit that, but like, it seemed like they, they were very clear that, that the deal was above board.

• 6:44Jordi Hays?

  But the, the, the reason that it stands out is if they, you know, they've done 20 billion year date to Singapore, if you get to 40, that will be 7% of Singapore's GDP just going to Nvidia.

• 6:56John Coogan?

  Yeah.

• 6:56Jordi Hays?

  Uh, which is wild.

• 6:57John Coogan?

  Yeah.

• 6:58Jordi Hays?

  Uh, the other thing that was interesting, um, there was an exchange around, uh, between Nvidia's CFO and an analyst, um, and, uh, Kress CFO said, we have, in, in reference to the government, uh, or, or, uh, conversations with the government, we have been communicating. She said, if nothing shows up, I've got licenses, I don't have to do this 15% until I see something that is a true regulatory document.

• 7:26John Coogan?

  Yeah. So maybe the, the 15% deal was announced, it's more of, uh, like a directional thing and maybe it's not papered yet.

• 7:36Jordi Hays?

  Yeah.

• 7:36John Coogan?

  Uh, I mean, as we saw.

• 7:38Jordi Hays?

  Yeah.

• 7:38John Coogan?

  And the question is like this. It, it, it could just be like another chip on the board that's going to be moved around and immediately traded away.

• 7:44Jordi Hays?

  Yeah.

• 7:44John Coogan?

  There's a lot of these things that get like pitched and before they even turn into anything real that affects the business in reality, they get traded to, for something else.

• 7:51Jordi Hays?

  And optics matter.

• 7:52John Coogan?

  For sure.

• 7:53Jordi Hays?

  Potentially more than the incremental revenue.

• 7:55John Coogan?

  A ton.

• 7:56Jordi Hays?

  You know, is, is the White House going to be chasing after?

• 7:59John Coogan?

  Yep.

• 7:59Jordi Hays?

  A few billion dollars.

• 8:00John Coogan?

  Yep.

• 8:00Jordi Hays?

  You're, you know, picking it off, uh, pennies.

• 8:03John Coogan?

  But you know what else matters? Ramp, time is money, save both, easy use corporate cards, bill payments, accounting and a whole lot more all in one place. Uh, Tyler, on the concept of, of holding on to the GPUs, I was talking to Jordi about this earlier today, um, it seems like, there, there's this question of like, if Nvidia is paying 60 billion in, uh, in buybacks or they're, they're, they're spending all this money, like, shouldn't they put that, we're in this boom, shouldn't they invest that money in growth, shouldn't they do something else? And, um, Jordi was, was mentioning like, maybe they should take more seriously like building an actual cloud service, building their own data center, holding on to the GPUs, as you said. Um, and my counter argument to that was basically that.

• 8:43John Coogan?

  They like Nvidia has pretty solid revenue concentration across like the duopoly of, I believe it's Microsoft and Amazon are like the two biggest power law buyers. I'm pretty sure it's somewhere in here. But anyway, like the hyperscalers are incredibly important. So people go through it's Meta and Microsoft actually is the one that that that people are, you know, guessing it is, but in in any way, the hyperscalers have this have this oligopoly going in cloud. And there's this, there's this game theory where if Nvidia said, hey, we're going to compete with AWS, we're going to compete with Google Cloud Platform or Azure, then

• 9:25John Coogan?

  then those hyperscalers would have immense incentive to go even deeper into their own silicon and cut out Nvidia's margin. And so there's this world where, okay, yeah, maybe in this hyper long term, it might work out, but there would be immense pressure in the short term as opposed to right now, if you're Nvidia and you have all the hyperscalers bidding for chips and they're all in super high demand, and so you're able to reap really high gross margins off of that, make a ton of money. You'd basically be giving that up, I think, if you if you broke up the oligopoly that buys from you like it's really, really great if you're selling something and two people walk in and they both want it because they have to pay the max price. And we've heard those stories about Elon and Larry Ellison getting dinner with Jensen

• 10:11John Coogan?

  Wong and being like, we need chips. And of course, Jensen saying like, well, you know, Satya and Andy Jassy want chips too, and Mark Zuckerberg wants chips, like, take a number, right? Anyway.

• 10:21Jordi Hays?

  Yeah, and they're in the beautiful position right now, which is however much they make of a certain chip is exactly how much they'll sell.

• 10:27John Coogan?

  Yep, yep.

• 10:30John Coogan?

  Anyway, the next earning call, I hope it's on Restream, one livestream, 30 plus destinations, multi-stream and reach your audience, wherever they are, we are, of course, on Restream. Should we go over to the Ben Thompson analysis?

• 10:41Jordi Hays?

  We should.

• 10:41John Coogan?

  Doug O'Laughlin from Semi Analysis joins in about 15 minutes. Ben Thompson writes, he quotes from the Wall Street Journal, of course, and says, "It's always dangerous to invoke the mythical law of large numbers, but the most important place to start with Nvidia's earnings is to check the supply and demand balance." Here's the answer from CEO Jensen Huang on the earnings call. Right now, the buzz is, I'm sure you all, I'm sure you all know the buzz out there. The buzz is everything is sold out. H100s sold out. H200s sold out. Large CSPs are coming out renting capacity from other CSPs. And so the AI-native startups are really scrambling to get capacity so that they can train their reasoning.

• 11:22Jordi Hays?

  Remember, Meta is buying from Nvidia but also renting from Google.

• 11:27John Coogan?

  Yes, it's a file.

• 11:28Jordi Hays?

  There was a $10 billion deal announced there last week.

• 11:32John Coogan?

  Ben says he made this point a year and a half ago, and it still holds as long as demand. Yeah, the man lives in the future. He lives a day ahead, or he did when he was in Taiwan. Now he's in America. As long as demand for Nvidia GPUs exceeds supply, then Nvidia's sales are governed by the number of GPUs they can make. That supply is certainly increasing, which is why Nvidia's sales continue to climb. But assuming that supply increases are linear, then by definition Nvidia's growth rate is going to slow as it laps ever larger revenue numbers that themselves grow exponentially. Yes, this was another reality check on are we feeling the acceleration or are we decelerating? And although the numbers from Nvidia's revenue

• 12:14John Coogan?

  growth are insane, staggering, it's like one of the most beautiful charts I've ever seen in business. It is technically decelerating, just like technically, if we were to just like do the math, it is not accelerating anymore. It's not bad. It's just like it is a reality check on things.

• 12:30Jordi Hays?

  Yep.

• 12:31John Coogan?

  So, the big complicating factor is China. And I didn't understand this as much as I kind of disagree with Ben maybe a little bit on this because the, China does seem like a complicated factor, but it seemed like the business in America was doing great. And really, China was like a call option. It was a nice to have. If it opens up and AI isn't seen as a weapon and Nvidia can seriously grow the China business, it's huge, huge upside. But it doesn't, it doesn't necessarily mean that they're in trouble right now if they can't do anything in China. So, he quotes from CFO Collette Cress.

• 13:09Jordi Hays?

  I don't know. I mean, I think, I think. You know, again, looking at Apple's situation in China, like it is definitely bearish.

• 13:19John Coogan?

  Completely different though. Nvidia doesn't actually manufacture in China.

• 13:23Jordi Hays?

  No, I'm not talking about manufacturing. I'm talking about purely demand, right? Apple's closing retail stores in China.

• 13:27John Coogan?

  Yes, but Apple, Apple sold a lot more in China than Nvidia ever did. And so Nvidia, like the whole, the, the, the, when, when, when, when Jensen was selling Nvidia chips to China and the first rumblings of like, hey, maybe he shouldn't do that for geopolitical reasons.

• 13:46John Coogan?

  Like popped up. One of the things people would say is that, look, like, yes, it's a, you know, it's kind of anti-free markets to not let him sell in, in China. But also there's plenty of demand in America. Like he, he doesn't have to sell in China because there's, there's, there's enough.

• 14:02Jordi Hays?

  But when Jensen talks about three to four trillion in capex before 2030, he's certainly including China in that.

• 14:09John Coogan?

  Yeah, he, he, I think he pegged it at like a $50 billion backlog of demand for Nvidia chips in China. If, if there were no geopolitical considerations. I am very interested to see where this evolves because the, the, the like AI is a weapon narrative is definitely cooling off. Uh, and so we could definitely see more opening up. But, uh, collect press addressed the H20s. Let me first answer your question regarding what it will take for the H20s to be shipped. There is interest in our H20s. There is an initial set of license that we received. And then additionally, we do have supply and we are ready. And that's why we communicated that somewhere in the range of two to five billion this quarter, we could potentially ship.

• 14:50John Coogan?

  Uh, we are still waiting on several geopolitical issues going back and forth between the governments and the companies trying to determine the purchases and what they want to do. So it's still open at this time and we're not exactly sure what the amount it will be this quarter. However, if more interest arrives, more licenses arrive, again, we can also still build additional H20s and ship more as well. Nvidia clear, this is Ben Thompson again. Nvidia cleared one hurdle when the Trump administration, after pausing H20 sales, allowed them to resume. The Chinese government, however, told Chinese companies not to buy the H20s, according to the Financial Times, which we covered on the show. Ben Thompson says he's always wary of falling into the trap of blaming the US for Chinese decisions. This is overly solipsistic view of the world.

• 15:33John Coogan?

  Is the root of a lot of bad analysis beyond being insulting to the intelligence and volition of the US chief's US's chief political geopolitical rival. At the same time, it would be nice to see the counterfactual of Lutnik keeping his mouth shut, or better yet, the Trump administration not causing a ruckus about the age 20s in the first place. The problem, of course, is that Lutnik is right. Chinese companies using Nvidia chips preserves US dominance of the dominant AI software stack. On the flip side, Chinese companies not using Nvidia both diminishes US control and for Nvidia specifically threatens not just their China sales, but in the long run, their sales everywhere, not just from Chinese competitors, but from competition generally. Should a Chinese open sourced Chinese pioneered open source CUDA alternative gain scale?

• 16:18John Coogan?

  And by extension, the fact that Nvidia isn't.

• 16:20Jordi Hays?

  Yeah, remember there are crushing it on the model side.

• 16:24John Coogan?

  Yes, yes, yes. And so the next thing might be, you know, maybe it's not deep sea V5 that's like the, you know, huge jump in capabilities, but the deep sea team or the high flyer team figures out how to have deep sea run on any hardware with an open source stack that's kind of a drop in replacement for CUDA.

• 16:43Jordi Hays?

  Well, and we were, we were talking earlier before the show about in a, if you're extremely AGI pilled.

• 16:51John Coogan?

  Yes.

• 16:51Jordi Hays?

  At some point in the future, you can just ask the AI, hey, figure out how to run on, on hardware other than Nvidia.

• 16:59John Coogan?

  Yes, rewrite this so that it doesn't run on CUDA. Tyler, you like that take here? Are you laughing?

• 17:04Speaker 02

  Yeah, that's a good take. I mean, it's like.

• 17:06John Coogan?

  It's like, if you're, if you're Nvidia, you want AI to be like bullish, but not too bullish, like good, but not too good. Because if it's, if it's bad, it's bad for Nvidia. If it's good, it's good for Nvidia. But if AI is amazing, you can just in one line, like, hey, rewrite, rewrite chat GPT or rewrite GPT, re-implement GPT five on, on, on TPU or on.

• 17:30Speaker 02

  I think it'd just be more for it to just ask it to like, just take over Nvidia, the company and then pull it into.

• 17:35John Coogan?

  Yeah, I guess. At that, at that point, we're in like such bizarre territory. But I mean, truly like replatforming should be something that AI would be uniquely good at, I would imagine.

• 17:46Speaker 02

  Yeah, I mean, you already see like a lot of code, like one of the early like coding use cases was just like translating like. JavaScript to TypeScript.

• 17:53John Coogan?

  It's a lot of what.

• 17:54Speaker 02

  Like something like very simple like.

• 17:55John Coogan?

  Exactly. I mean, AI has been good at just translating English to French for a long time.

• 17:59Speaker 02

  Yeah, I mean, that was the original like transformer.

• 18:01John Coogan?

  Yeah, yeah, yeah. And and also, I mean, when you look at the success of like, what is cognition really, really great at? What does Microsoft highlight cognition for? It's not necessarily like one off projects. It's more like replatforming.

• 18:16Speaker 02

  Yeah, like tech debt.

• 18:17John Coogan?

  Yeah, tech debt. Oh, you have some enterprise system and it's on C sharp and you want to put it on Python like let's rewrite it. And that's a huge pain to go rewrite all that business logic. But you can just have, you know, Devin or an agent go and like hack away at it for a while. So you could imagine that that potentially would happen in the future. But if I but if you've been following George Hotz's like, you know, problems with Nvidia or and AMD. He's been really trying to like unseat Nvidia as the high margin business in the space by getting AMD to solve some software bugs. And I think at a certain level, if there are intractable bugs that even George Hotz can't solve, well, then, you know,

• 19:03John Coogan?

  like the frontier AI model might not be able to solve them too. So I I I don't think this is going to be an overnight story that we're going to see CUDA un unseated. Anyway, Ben Thompson continues moats in China. One interesting way to think about Nvidia in China and why Wong is so desperate to sell into the country is the nature of their moat. He says, let's talk about ASAY. This is Wong wants, let's talk about ASIC first. A lot of projects are started. Many startup companies are created. Very few products go into production and the reason for that is that it's really hard. Accelerated computing is unlike general purpose computing. You don't write software and just compile it into a processor. Accelerated computing is a full stack code design problem.

• 19:47John Coogan?

  The AI factories in the last several years have become so much more complex because of the scale of the problems have grown so significantly. So. Ben Thompson says the answer captures two parts of the moat. First is CUDA, Nvidia's software stack for controlling Nvidia GPUs, which is the default option. The second is that CUDA is everywhere, which means you can go to any cloud provider, hire developers familiar with CUDA, et cetera. And then Jensen says that in addition to all that, it's just extremely complex systems problem. It's just a, it's just a, it's just a extremely complex systems problem. People talk about the chip itself. There's one ASIC, the GPU that many people talk about. But in order to build Blackwell, the platform and the Ruben, Ruben, the platform,

• 20:30John Coogan?

  we had to build CPUs that connect fast memory, extreme energy efficient memory for large KV caching necessary for agentic AI to the GPU and a super NIC to scale up switch, which we call NVLink.

• 20:45John Coogan?

  This, this is the third part, which is networking. I keep referring to Nvidia's GPUs, but in reality GPUs work at the system level, particularly for training and Nvidia's ability to link GPUs together into a single coherent system is unmatched. This is a big revenue driver, too. This quarter networking revenue, networking revenue was 7.3 billion, which is more than Nvidia paid for Mellanox, which is the foundation of their networking offering. Pretty sweet that they paid, they paid billions with that. Now, just in this quarter, they made more revenue from that acquisition. It's truly one of the greatest acquisitions of all time, says Ben Thompson. Wow. Yeah, insane. I don't know. You can go subscribe to Stratechery to read the rest of the, of the article.

• 21:29John Coogan?

  My other takeaway was on the debate about, about should Nvidia pay a dividend or do stock buybacks? And so I looked at the data of, is this out of character? Should you read into that? Because it's a huge number, $60 billion going out of the balance sheet onto, yes. Into share buybacks. And it's also like the stock's never been, it's the biggest company in the world. The stock's never been higher, like. We're kind of like buying the top almost.

• 22:04Jordi Hays?

  Top blasting yourself potentially.

• 22:06John Coogan?

  It feels, it feels odd, but, but I was wondering like, okay, sure, we need to reality check this. Like, is this actually something new? Is this an idea that they're like out of, out of ideas or something? And that's the, that's the Tealine critique of Google doing dividends or share buybacks.

• 22:21Jordi Hays?

  Yeah, they don't have any idea.

• 22:23John Coogan?

  They don't have any ideas. And so we walked through some of the ideas and there weren't any that really stuck out. If they, if they build their own hyperscaler, well, then they're competing with their best customers.

• 22:32Jordi Hays?

  You mean a, a cloud service provider?

• 22:34John Coogan?

  Exactly.

• 22:35Jordi Hays?

  Really go hard in that.

• 22:36John Coogan?

  Yes, yes, yes. If they say, hey, Amazon, like you, you don't need to put any more orders in. We're gonna, we're gonna take the GPUs for a second. It's like, okay, well then they lost all that, all that margin, all that business. That could be really disruptive.

• 22:46Jordi Hays?

  And that business will take a long time to scale to the point where.

• 22:49John Coogan?

  And then, and then Nvidia is investing in startups and, and they have a whole, they have a whole business just around

• 22:58John Coogan?

  GPUs that go into cars. They have an automotive business.

• 23:01Jordi Hays?

  Just buy Y Combinator.

• 23:04John Coogan?

  Craziest thing.

• 23:05Jordi Hays?

  Just start coming up. I mean, we should sit down and.

• 23:08John Coogan?

  The dumbest things that they could do.

• 23:09Jordi Hays?

  Gulfstream.

• 23:10John Coogan?

  Yep.

• 23:10Jordi Hays?

  Y Combinator.

• 23:12John Coogan?

  Okay, but, so what I had, uh, uh, what, what I polled in terms of numbers was as, in terms of the, the, the, the market cap of Nvidia at the start of the year, what percentage of that market cap was paid out either in, uh, stock buybacks or dividends? And so this year, 60 billion, it's a lot, but the market cap's super high. And so in fact, the, uh, the total amount of, uh, the total net payout as a percentage of the start of the year market cap is 2.82%. So you can think about it as like you're getting 2.8%.

• 23:54John Coogan?

  2.8% like yield on the investment, although obviously like the, the, the, the, the share price movement is much more important. Last year was 2.7%. The year before it was 1.42% and in 2022 it was 0.12%. So much lower. So it is growing, but, um, it wasn't, it was much higher in 2016. 2016 was 7%.

• 24:17Jordi Hays?

  Yeah, the bears came out of hibernation in a big way and Nvidia is still up 4.6% in the past five days.

• 24:24John Coogan?

  Yeah, of course.

• 24:27Jordi Hays?

  Jensen has the hardest hardest job in the world.

• 24:31John Coogan?

  Truly, truly. I mean, it's such a it's such like a price to perfection, like the perfect avatar for the AI boom, not just not just index AI, but actually like throwing off cash, amazing margins, just really great all around. And yeah, it's hard to imagine them like it's not like they're like getting over their skis because like there can be.

• 24:51Jordi Hays?

  Yeah, the thing you have to give him credit on is the relent, I mean, among a bunch of things, but relentless focus even during this period of euphoria. I mean, there'd be a lot of companies that would be like, we need a mobile phone. Let's make the Nvidia phone. We need a cloud. We were joking the other other week about how a lot of the Mag Seven have a social network. He's not, he's staying focused.

• 25:15John Coogan?

  He hasn't even like joked about buying TikTok and we have.

• 25:19Jordi Hays?

  Yeah.

• 25:21John Coogan?

  Yeah, it's one of those things where we saw a pullback in Nvidia after the crypto boom. When I, I mean, there were a bunch of other things going on with the market and interest rates, but Nvidia drew down immensely. And part of that, or part of the story was that GPUs were being used to run Ethereum nodes and validate. And when Ethereum went proof of stake instead of proof of work, it became a lot less compute intensive. And so there was this kind of overhang. There was also an overhang from COVID and people buying there was chip shortages and people buying gaming PCs and stuff. And so Nvidia drew down a ton. Ben Thompson wrote Nvidia in the valley and basically like bottom ticked

• 26:01John Coogan?

  it perfectly. And and unfortunately Nvidia is set up, it seems like it is set up to withstand a some sort of like correction or drawback or stagnation in AI progress. Like, the business would contract, of course, but there's nothing, they're not over their skis where they've like made this massive commitment in their and they'd be in a ton of trouble, at least from my perspective. Anyway, let me tell you about figma.com. Think bigger, build faster. Figma helps design and development teams build great products together. We have our first guest Doug Olafland from Semi Analysis hopping on the stream in just a few minutes. In the meantime, I do want to go through this post that Ben

• 26:46John Coogan?

  Thompson highlights from Ethan Ding.

• 26:49John Coogan?

  About the changing economics of AI. It's a longer post, so we'll have to do it a little bit later. But he quotes here, imagine you start a company knowing that consumers won't pay more than $20 per month. Fine, you think classic VC playbook, charge at a charge at cost, sacrifice margins for growth. You've done the math on CAC, LTV, all that. And that but here's where it gets interesting. You've seen the A16Z A16Z chart showing LLM costs dropping 10x every year. So you think I'll break even at $20 a month. And when models get 10x cheaper next year, boom, 90% margins, the losses are temporary, the profits are

• 27:30John Coogan?

  inevitable. But demand exists for the best language model, period. And the best model always costs about the same, because that's what the edge of inference costs today. When you're spending time with AI, whether coding, writing, or thinking, you always max out on quality. Nobody opens Claude and thinks, you know what, let me use the the bad version to save my boss some money. We're cognitively greedy creatures. We want the best the the best brain we can get, especially if we're balancing the other side with our time. While it's true, each generation of frontier model didn't get more expensive per token, something else happened, something worse. The number of tokens they consumed went absolutely nuclear. Chat GPT used to reply with to a one sentence question with a one sentence

• 28:15John Coogan?

  reply. Now, deep research will spend three minutes planning and 20 minutes reading and another five minutes rewriting a report for you while O3 will just run for 20 minutes to answer. Hello there. The explosion of RL and test time compute has resulted in something nobody saw coming. The length of task that AI can complete is doubling every six months. What used to return 1,000 tokens is now using returning 100,000 tokens. So interesting dynamic there. We will continue with that, but we need to introduce our first guest of the stream, Doug Olafen from Semi Analysis. Doug, how are you doing?

• 28:47Doug O'Laughlin?

  Good. This time my mic should work, so.

• 28:49Jordi Hays?

  There we go.

• 28:49John Coogan?

  Sound great.

• 28:50Jordi Hays?

  Mic'd up.

• 28:51Doug O'Laughlin?

  Thank you.

• 28:52Jordi Hays?

  Dude, I didn't want to repeat the last time. I like that you're holding it too, like some type of rapper.

• 28:58Doug O'Laughlin?

  It's much more personal.

• 28:59Jordi Hays?

  Can we call you, I'm gonna call you Young Semi.

• 29:02John Coogan?

  I am getting a little ASMR vibe. It's perfect though. I love it.

• 29:06Doug O'Laughlin?

  Hello, welcome to Young Semi's rap. Anyways, what's up guys? I have no idea what we're talking about.

• 29:11John Coogan?

  We're talking about Nvidia. We're talking about Nvidia earnings. Give us.

• 29:15Jordi Hays?

  Should we be talking about something else?

• 29:16John Coogan?

  Yeah, what else is?

• 29:18Doug O'Laughlin?

  No, I, I think that's the right thing to talk about, but I, I guess my brain is really broken. I'm like, bro, this is a snoozer compared to the blowout quarters of past.

• 29:26John Coogan?

  Yes, that's fair. What did you take? What do you think about the fact that Jensen is on a relative basis extremely bearish compared to Leopold Ochenbrenner at situational awareness? Leopold expects 15 trillion in CapEx or AI spend by 2030. Jensen, a mere three to four trillion.

• 29:50Doug O'Laughlin?

  Hey, don't know what to tell you, man. I think there might be, uh, some people might be talking their book, right? Like, I guess, I guess, I, I, I do know Leopold. I definitely know his worldview is Manhattan Project for AI. So I think maybe Jensen hasn't come, come around to the Manhattan Project for AI, but I think just a mere two or three trillion is quite a bit of CapEx. It's, um, some would say it's not an insignificant amount of money. But, um, they tried to bait him on the call too about tokens, token revenue, about it 10x-ing next year. I thought that was kinda interesting. Um, I don't know. It was, it was a fine result.

• 30:24John Coogan?

  Yeah, yeah, yeah. Uh, going to that token revenue, there was something where it felt like he was, he was making the case, he was trying to lay out the economics for the actual customer. Saying, if you spend this much, you can make this much money. And it felt like, I don't know, just like a different, different way of framing his business. Um, can you explain exactly what he was doing there?

• 30:47Doug O'Laughlin?

  This is, okay, so one, semi analysis, as you may have figured out, is on to this. We're trying to figure out the math ourselves. They obviously scooped us, but, uh, not quite scooped per se, but there's a lot of work to be done to understand the, the unit economics, right? A lot of people have asked, hey, what's the AI ROI, right? Like the, you guys are spending all this money and like the, the, I'm sure you saw the tweet on the timeline. Depreciation is bigger than all the revenue.

• 31:12John Coogan?

  Yes.

• 31:13Doug O'Laughlin?

  This is a total bubble, blah, blah, blah, blah, blah.

• 31:15John Coogan?

  Yep.

• 31:15Doug O'Laughlin?

  Um, the depreciation number, I don't know. I think Martin Scully of all people was like, this really sucks. Um, but I, I think a lot of it, the data center long line.

• 31:22John Coogan?

  Just saying, to be clear, saying it sucks because it's just not good analysis.

• 31:26Doug O'Laughlin?

  It's not good. It's, it's, it was a bad analysis.

• 31:29John Coogan?

  Yeah.

• 31:29Doug O'Laughlin?

  Yeah. Yeah. I think he specifically talked about like human level intelligence on a B one hundred. He used a pretty long useful life. I don't know if we agree with that useful life, but like the data center side of that capex and the power side of it, extremely long useful life, like let's just say 10, 20 years.

• 31:43John Coogan?

  Totally.

• 31:44Doug O'Laughlin?

  So you can, you're, there definitely some of that is pulled forward. And so you can say that capex is not going to be just be used for next year or this year. It is a multi-year investment. But on the, on the GPU side, I think the unit economics is the question that people are really trying to get to the bottom of. And the one that, um, Collette specifically called it out is you spend $3 million on a rack and you can make $30 million in token revenue.

• 32:06John Coogan?

  Yeah.

• 32:06Doug O'Laughlin?

  Um, I think one, uh, you know, which tokens are you selling? Uh, right? That, that's like the real question here is like, how many tokens are you selling? What's the throughput? There's a lot of assumptions here. Semi-analysis, I'm not going to lie to you, is like quite literally working on this right now to figure out like, what's the type of like, you know, if they were selling anthropic tokens, which are like have a premium because they're really good at, uh, Sweetbench, right?

• 32:26John Coogan?

  Yep.

• 32:26Doug O'Laughlin?

  Or if they're selling GPT, or if they're selling MAMA or, or GPT OSS, right?

• 32:30John Coogan?

  Yep.

• 32:31Doug O'Laughlin?

  But it's pretty clear to us at least that it's very, very economic to run these things like one rack. If you could find a hundred percent free tokens, you are, or no paid tokens, you are minting money. It is just straight up like a 10x return on one year. That might not even be, you know, that might be a multi-year thing where you, you're able to print a lot of money.

• 32:52John Coogan?

  Yeah.

• 32:52Doug O'Laughlin?

  Um, these tokens, the, the GPUs that are able, uh, the amount of tokens that are able to come out of it is we're talking, you know, millions and millions and millions a year, if not billions or something, or on inference on like an annual basis. And if you get that all paid, you're, you're, you're printing, dude.

• 33:07John Coogan?

  Yeah. Yeah. I mean, it, it feels like we're in this like, like middle ground between like, there's, there's some, you know, I, I believe Nvidia revenue is decelerating technically.

• 33:18Doug O'Laughlin?

  Uh, yes.

• 33:19John Coogan?

  The, the earnings are kind of snoozed.

• 33:20Jordi Hays?

  Supply is increasing linearly.

• 33:22John Coogan?

  Yeah. Yeah. Like they're, they're.

• 33:24Doug O'Laughlin?

  Yeah. So it's uh, they don't let anyone call, say law of large numbers. That's not what it is.

• 33:30John Coogan?

  Okay.

• 33:30Doug O'Laughlin?

  But uh, cause they'll get like misquoted. Like what happens is like, the base gets bigger and so it decelerates. It's mechanically impossible for it to accelerate on a larger, maybe not mechanically impossible, but it's extremely hard.

• 33:42John Coogan?

  Yes.

• 33:43Doug O'Laughlin?

  You, you go from 50 to 100 billion, then you have to go from 100 billion to 200 billion just to keep that same rate without a deceleration.

• 33:50John Coogan?

  Yes, yes, yes.

• 33:51Doug O'Laughlin?

  Getting a bigger and bigger base.

• 33:52John Coogan?

  Yes, but, but a year ago, like there were plenty of people that were saying like, yeah, like acceleration. Like we are literally accelerationists. Like we believe in acceleration and we believe that like, yes, like we will go from 50 to 100 to 200 to 400 to 800. Continue, continue, continue. Uh, and, and more so, because even that would be uh, continuous growth. Um, anyway, so, so you have this, so you have this narrative of like, of like, there is some deceleration in, in the, in the rate of Nvidia growth, but the chart is still insane. Uh, and then simultaneously like, like the, the profitability of actually using their product seems very, very good. So does that just mean that we're, we're in this like, it's, it's a snoozer in the sense that we're in this era of like, the economics makes sense, the business is good.

• 34:36John Coogan?

  It's like the oil business now, it's not gonna fall apart, but it's also not going to explode. Like we're in kind of a, a smoother territory, whereas like a few years ago, we, when we were before the kink in the graph of Nvidia revenue, it was very much like, what is gonna happen here?

• 34:54Doug O'Laughlin?

  That's a great question. Um, this is where, you know, I, I definitely think, and I get why people are saying bubble, big numbers are happening. There's a lot of exciting technology. The internet is a great example, but um, let me give another example that I think kind of maybe is a better analogy. Apple, when it came out with this iPhone, and I'm sure you can tell me exactly where yours is next to me.

• 35:13John Coogan?

  Yep.

• 35:14Doug O'Laughlin?

  Next to you, right? Everyone got one in like a really quick amount of time. It became this giant generational product where we went from like zero people with a, with a smartphone to 60% of people with a smartphone within five years, right? Um, and it sold a crap ton of them and then it kind of, uh, the first few years were these exciting blowout quarters, especially in the beginning, like these, these, you're like, holy crap, this changes everything.

• 35:36John Coogan?

  Yep.

• 35:36Doug O'Laughlin?

  And then it becomes boring execution. Um, so we could be in the world of boring execution, but I definitely think, um, you know, the ROI of the underlying. Rack is really good asterisk if you have paying tokens. But if you look at the vast majority of tokens that are being consumed today, they're definitely not paid, right? That's the free side. I think I was here on GPT five day, which by the way, I literally got off that call. And then I started thinking about ads and then we posted it on semi analysis. So it was like very funny. I wish I had the hot take then, but, but it would have scooped us. But yeah, that's an example where I think.

• 36:09Jordi Hays?

  Never scoop yourself.

• 36:10Doug O'Laughlin?

  Yeah, never scoop yourself.

• 36:11Jordi Hays?

  When you're the subscription business at least.

• 36:13Doug O'Laughlin?

  Yeah, yeah, exactly. It's like, dude, I don't, I gotta keep, I gotta keep the lights on. No, but if you think about it, like it's about how to translate tokens into revenue in a way that isn't like this freemium model. And I think, you know, agentic purchasing, which is like kind of our, you know, five second thesis of how we think is a potential way to monetize the free business. That's an example of that's how you monetize it. And all of those tokens now that are freed, you found a new end state of people who don't want to pay for intelligence, right? I don't think you can make the assumption that someone in Indonesia with the GP per capita way lower than the United States is going to be paying 200 bucks a month for GPT five pro, right?

• 36:56Doug O'Laughlin?

  The reality is those tokens have to become something of value. Otherwise we're just going to print deflation. We have to make it tokens are like, uh, tokens are like a website like www.com, right? Like whatever you have to make it a business on the tokens. And so I think we're in that portion where it's pretty clear that if you can, if you can monetize those tokens, you're going to have a really, really good business. And now it's the question of how do we get the token machines to become revenue monetization? And so that's kind of the path forward, I think of, you know, maybe the boring execution that happens for the model companies and the startups and the whole ecosystem altogether. But Nvidia side as, you know, being the fundamental core infrastructure, it's put

• 37:39Doug O'Laughlin?

  pretty clear horse, you know, horses out of the barn for, for the infrastructure. They're building, everyone's buying them. People are like, holy crap, we gotta have more power. Like it's, it's, you know, you could see.

• 37:50Jordi Hays?

  So some, some of, uh, some folks on the timeline were bearish on the buyback.

• 37:57Jordi Hays?

  Do you have any ideas of better ideas for how to spend that money if you were running Nvidia than than than a buyback?

• 38:08Doug O'Laughlin?

  So, okay. Oh, my God, I'm in buyback discourse all again, like buyback discourse anyways, has like a little bit of little bit of religion, but I think remember the buyback is a $60 billion authorization. An authorization is not a commitment to means that they can buy. You have to go get your authorization from your board of how many shares you're allowed to purchase. And 60 billion for a company the size of Nvidia is like kind of a penny in the bucket. They make a lot, you know, that's, you know, that's a one year profitability, I think. No, let me make sure I get that. Yeah, that is one year of cash from operations right now. So that's actually not that much 60 billion sounds like a huge number.

• 38:49Doug O'Laughlin?

  But they just make so much money that that is a correctly sized buyback authorization authorization for Nvidia, in my opinion. I think what should they do with that money is gonna be one of the greatest questions of like all capital allocation history. That same question came up with Apple, came up for Apple when they were gangbusters, right? They didn't reinvest back into all this other stuff. They printed cash, they bought back a lot of shares, stock went up. The most tangible example of financial engineering in our time.

• 39:22Jordi Hays?

  Yeah, didn't they return something like a trillion dollars?

• 39:24John Coogan?

  Yeah, one trillion dollars to shareholders in the past.

• 39:27Doug O'Laughlin?

  Yeah, and dude, dude, it's it's actually kind of like, okay, so you can feel different ways about it because it's also kind of spooky. Like, just if you are an active market investor who is listening to this, you can understand. Apple's a stock that will not go down. It like it is like it is against like it levitates. It's like 30 times earnings, earnings isn't even growing, but they just gush so much cash and they purchase repurchase so much shares. And they're such a huge part of the S and P 500. Like you could make an argument that like Apple's percentage contribution of the P and L of like the S and P 500 from like 2010 to 2020 is like. 25 like it's it's it's a meaningful amount of percent. So the entire 401ks, the entire country got paid by Apple's buyback. That's kind of sick if you think about it. But on the other

• 40:12Jordi Hays?

  side, you don't think they should launch a mobile phone or a social network?

• 40:15John Coogan?

  Mobile phone?

• 40:16Jordi Hays?

  No, we're just joking how like every company like gets euphoric. It's time to make a phone.

• 40:21John Coogan?

  Well, six out of the mag seven kind of have a social network. If you count iMessage and you count LinkedIn and YouTube and Twitch, like Andy Jassy has Twitch, which is kind of hilarious. Elon has Twitter. And we were thinking, the obvious one is Jensen buys TikTok, but I think they got to do DJX cloud, social network where you can just talk to other, other

• 40:42Jordi Hays?

  Cuda engineers.

• 40:43John Coogan?

  Fans, basically, yeah.

• 40:45Doug O'Laughlin?

  I, I don't think, I think Jensen's pretty strategic. I don't know what he's going to spend it on. I want him to spend it on something like inspiring and mind blowing where you're just like, dude, this is, this is sick. You're a genius, right? But the reality is deploying like a hundred billion dollars of capital. It's pretty hard. That's not like walking around like that is like buying a country. Like, what are you gonna do with it?

• 41:06John Coogan?

  Yeah, yeah, yeah. I mean, like, the best thing to do if you care about innovation is give the money back to your shareholders, let them invest in venture funds, or let them invest in startups and, and maybe don't try and build that functionality internally.

• 41:19Doug O'Laughlin?

  Yeah, capitalism would say that for sure. I definitely think that you should, you should swing if you see a fat pitch. Meanwhile, you see all the hyperscalers who are plowing back as much money as they can into the, into the Neo clouds. They are saying, hey, we are seeing a giant ROI. So I think that that's like, you know, a fundamental question for Colette and Jensen. That's very hard to answer. I don't, and you know, I don't, I don't think you could tell me what, what would I do with a hundred billion dollars. It's adjacent to Nvidia's business. That would be a better business than what Nvidia does. The answer would be maybe nothing, honestly. If you could purchase something, that'd be sick. Also, I wanted to make one thing before we continue back on the social media thing. If I've learned anything on being on the timeline, dude, it's billionaires are just like us. They just want to tweet at people.

• 42:04Doug O'Laughlin?

  Getting fights. They love that.

• 42:07John Coogan?

  Yeah, it's amazing.

• 42:08Jordi Hays?

  True. What, what did you think about Colette Kress's comments? She said, we have been communicating in regards to the government. If nothing shows up, I've got licenses. I don't have to do this 15% until I see something that is a true regulatory document.

• 42:25Doug O'Laughlin?

  So they have a license.

• 42:28Doug O'Laughlin?

  I think, I think to me, how I took that is they have, they think that there's a high conviction they can sell H20s to a certain point. That's my, my reading of it. Um, I do think that there's this weird spot here, though.

• 42:41Jordi Hays?

  Well, I think that, that, my reading of that was she felt that we're selling H20s and we're, we're not just sending wires to, to Uncle Sam yet.

• 42:52Doug O'Laughlin?

  Yeah. Yeah. I don't think they're sending wire. Well, cause here's the thing is like, they have a deal at the top level, but no one has, like the, the administration hasn't gotten done. Like the bureaucracy of like, okay, here's the mechanics, right? So if they have licenses, they can send it. Maybe they will hold it on, you know, they, they have enough cash. I think they can, they can, they can wire a little bit, uh, over. I, I think they have, they're good for the money. But yeah, I think it's this kind of, it's a, it's a complicated administrative thing, meaning that like, they have what is in theory, the deal, but no one has actually inked the mechanics of it, of how they're wiring it.

• 43:28Jordi Hays?

  And it could always, it could always change. What do you, what do you think could, um, if, if people were, were bearish on just a small beat, what do you think could, could flip, uh, the timeline? Giga bearish? Would it be just a, a bad miss? I think the other, uh, we, we were talking earlier, you know, potentially hyper, like language coming out of other hyperscaler earnings calls of saying like, hey, we're, yeah, we're, we're actually reducing.

• 43:56Doug O'Laughlin?

  Yeah.

• 43:56Jordi Hays?

  Orders, things like that. That, those, those to me, like, it feels like one sentence in another hyperscaler's earnings call could send the stock down a meaningful amount, but.

• 44:06Doug O'Laughlin?

  I think what it would have to be is pretty much the explicit, the explicit endorsement of everyone who's involved being like, yeah, that's a bad idea now. Like we gotta, we gotta stop investing, right? Like, um, like meta.

• 44:22Jordi Hays?

  Like what happened with the metaverse?

• 44:24Doug O'Laughlin?

  Yeah, yeah. It's exactly where we're like, all of a sudden it's time to get fit. And we're, we know, maybe we shouldn't have spent like 10 billion dollars a year on Metaverse and like, I, did you guys know Horizon, whatever that it was?

• 44:35Jordi Hays?

  Horizon World?

• 44:36Doug O'Laughlin?

  Launch day? The, like, do you know the launch day statistics? It's like really funny. He spent like, like, I don't know, let's just say $20 billion and like on launch day, there were like a thousand people on.

• 44:45Jordi Hays?

  Whoa.

• 44:45Doug O'Laughlin?

  Like. I mean, I, you could have just sent me a check in the mail. I would have showed up for like a million bucks, dude. It would have been better.

• 44:57Jordi Hays?

  Dog's just sitting there, just.

• 45:01Doug O'Laughlin?

  I'm like, I'm an act, I'm a happy active user as long as these checks keep coming.

• 45:07Jordi Hays?

  The dog.

• 45:10Doug O'Laughlin?

  Yeah, I think it's, I think it's a belief that it's a bad investment and at the current time, investment, you know, there's like a a vague vibe in terms of what is being bullish or bearish or what is investment appetite? No one can really define it for me. No one really knows, but at this current point in time, like if you're looking at the board, I think Zuck is bold the F up, right? Like he is so bullish. He's, he's paying for all this stuff, you know? Sam Altman, Sam Altman, dude, he's like, give me another trillion dollars and I will give you a trillion dollars to compute. He's like, maybe there's a bubble, whatever. I think most of the participants right now are pretty excited. And I do wanna like, you know, I, I wrote about like the internet bubble, actually like quite a bit.

• 45:52Jordi Hays?

  Yeah, I was gonna ask what, what, how much have you studied Broadcom specifically? I was, I was trying to look up, I, I don't, from, from what I could find Broadcom wasn't doing bu- buybacks even during the, the crazy heyday.

• 46:05John Coogan?

  They were buying a bunch of companies with their stock. That was the, the big.

• 46:08Doug O'Laughlin?

  Yeah, but I don't think Broadcom is the perfect comp, actually.

• 46:10Jordi Hays?

  Yeah.

• 46:11Doug O'Laughlin?

  Yeah, Broadcom was like, Broadcom was a baby in the 2000s. And then also Broadcom, the machine that is Broadcom got bolted together with, um, Huck Tan, like, you know, the, the, actually capitalism's greatest hero. He is so hardcore. Like he, he, his, his whole thing is like, you know, did you know his entire company?

• 46:32Jordi Hays?

  The nominative determinism is crazy.

• 46:35Doug O'Laughlin?

  Fifty people of IT cover the entire, uh, organization of Broadcom. It's like, it's like he's the cut to the, like, cut to the core. Anyway, sorry, this is a complete tangent.

• 46:44John Coogan?

  What do you mean 50 people?

• 46:46Doug O'Laughlin?

  Fifty people is the entire IT department of like the 40,000 people at Broadcom.

• 46:53John Coogan?

  That's insane.

• 46:55Doug O'Laughlin?

  Yeah.

• 46:55John Coogan?

  Wow. Dude, and.

• 46:56Jordi Hays?

  Well, yeah, and their revenue ramps were so humble. It was like a hundred to two hundred, then two hundred to.

• 47:01John Coogan?

  Four hundred, something like that in nineteen ninety eight.

• 47:05Doug O'Laughlin?

  Yeah, but that's like, but you, that's not the right company. Cisco was the, Cisco is Nvidia. Cisco is Nvidia. That's the, that's the comp. And those revenue ramps were pretty nuts, but I think the difference, though, is Cisco was not gushing cash like Nvidia was. Like, it's not even close. I think they had like a twenty percent profit margin. And also, I think the difference, too, is during the internet bubble, it was pretty clear that everyone was

• 47:31Doug O'Laughlin?

  doing fraud effectively.

• 47:32John Coogan?

  Yeah. With a lot of circular transactions, right?

• 47:36Doug O'Laughlin?

  Yeah. Yeah, yeah, the circular transactions. That was a huge, pretty well-known thing. I actually talked to a guy who quit his job at one of the, the, the networks and became a hedge fund guy. I was like, yeah, we're shorting these stocks. The, the revenue zero. Like, like, he literally left to go join the financial industry to short stocks.

• 47:54John Coogan?

  Wow, that's wild.

• 47:56Doug O'Laughlin?

  I don't think.

• 47:56Jordi Hays?

  That's a true bear. That's a true bear.

• 47:59Doug O'Laughlin?

  That's conviction, you know, that's like the, the inverse Leopold, actually.

• 48:04Doug O'Laughlin?

  So I, I just don't think we have that widespread, like, craziness that the internet bubble was in a lot of ways. Like, websites barely worked, man. You could barely use stuff. I mean, I'm, I don't be you, but I am using ChatGPT.

• 48:18Jordi Hays?

  Well, yeah, so here, here's an example. So yesterday Satya hit the timeline and, and dropped a thread on how he's using GPT-5 and co-pilot. Everybody was immediately just like, bearish, bearish. Like, why, why is he posting use cases?

• 48:32John Coogan?

  I think he's just flexing on everyone, being like, I have the code to GPT-5. Like, I got a copy.

• 48:38Doug O'Laughlin?

  Yeah.

• 48:39Jordi Hays?

  But, but it says, it does say something that, that he's just showing how a product is actually valuable to him in his work life. And people are like, bearish.

• 48:48John Coogan?

  It's very moderate. It's a very moderate thing. Cause he's not saying like, oh yeah, like I used, I used GPT-5 to make decisions as a CEO. No, it's like, it's like, I use it in this narrow use case. It just reminds me about this particular thing, creates meeting notes, like very practical, like, you know, one iteration forward of the technology cycle. He's not saying, you know, oh, I'm, I'm on the beach because GPT-5 runs Microsoft now.

• 49:10Doug O'Laughlin?

  Yeah, I have my coding swarm running Microsoft instead of me.

• 49:14John Coogan?

  Yeah.

• 49:14Doug O'Laughlin?

  Yeah, I don't think he's I I think it's um, I think another part about the tech bubble that really make and like, look, stocks are expensive for sure. I'm I'm I'm gonna like hedge like, you know, no one knows the future. Markets are humbling. That's something I really wanna like, things can happen that are just like crazy outside of like what you know. Dude, the 2000 tech bubble was like, pretty crazy, like really, really, really way crazier in a lot of ways in terms of just like raw speculation. The revenue accelerations you're seeing from hyperscalers should give you some credit that like, there is revenue happening. People are losing money on selling tokens, but like, this isn't this like totally fake business model yet. But but just like history, what happens is, and there's a really good book called Technological Revolutions in Financial Capital by

• 49:59Doug O'Laughlin?

  Carl, I can't say her name, Perez?

• 50:02John Coogan?

  Yeah.

• 50:02Doug O'Laughlin?

  I think, I don't know. Yeah, I don't know why I can't say it.

• 50:05John Coogan?

  Carlotta Perez.

• 50:05Doug O'Laughlin?

  Carlotta Perez, thank you.

• 50:07John Coogan?

  Yeah.

• 50:07Doug O'Laughlin?

  Carlotta Perez.

• 50:08John Coogan?

  You gotta throw a little accent on there and then it comes out easier.

• 50:12John Coogan?

  Yeah, she's great.

• 50:13Doug O'Laughlin?

  But but that, I think that that's like a really good way to think about it. It's like this stuff will have a blow off. Like capitalism works via these like concentrated blow off booms that create a new technology. Now, are we possibly in one? Yeah, for sure. I mean, we're doing real investment. But we don't know, you know, when you're building a new industry, pretty much the supply demand curve is unknown to anyone. No one knows what the actual demand is. They know it's larger than the supply today, so they build more supply. But then at some point, you figure out where demand is and you're like, ah, we reached it. And then you completely overshoot it and then you're like, crap.

• 50:51Jordi Hays?

  Yeah, it'd be interesting to to look back of of how analysts at the time were were looking at the car being like, not, everybody's not gonna have a car. Like people, like every family in America is not gonna have a car.

• 51:03Doug O'Laughlin?

  Yeah.

• 51:03Jordi Hays?

  And then over time.

• 51:04Doug O'Laughlin?

  Who needs one? Who needs one? It's so expensive.

• 51:06Jordi Hays?

  You only use it here or there. I can I can ride the bus, you know?

• 51:10Doug O'Laughlin?

  Exactly.

• 51:12Jordi Hays?

  What about uh, Dario's math was going viral uh, earlier this week. He was talking about how uh, if you look at uh, if you just look at the basically the P and L of of the foundation model company, it looks really bad.

• 51:27Doug O'Laughlin?

  Oh, the cohort stuff?

• 51:28Jordi Hays?

  Yeah, you have exponentially increasing costs, but if you look at each model as an individual company, it's like you. Invest some money and then you make more back. You invest some money and you make more back. Do you think that?

• 51:42John Coogan?

  That made perfect sense to me, but I don't know.

• 51:44Jordi Hays?

  Yeah, but every, but it's the interesting thing is you have FinTwit, which is just like, everything's bearish. Then you have Tac, which is, oh, that makes, that makes sense. Like, maybe it's a little overheated.

• 51:56John Coogan?

  You should do more. They should do a hundred acts every year.

• 51:59Doug O'Laughlin?

  Yeah, it's like, whoa, you're telling me that you're making that return on a cohort? Let me give you a hundred billion dollars.

• 52:04John Coogan?

  Yeah, of course.

• 52:06Doug O'Laughlin?

  I think, um, look, and, and, and I'm guilty of this as well. You get to sound smarter when you're bearish, for sure. And FinTwit is inherently bearish, for sure. That's, that's part of it. I think, I think this, this is gonna be really interesting because every step of the way, people are gonna be, have been skeptics and probably will continue to be skeptics, which is like, pretty great, honestly. If you, if you're talking about like a true capital formation bubble. One of the reasons why 2000 was so intense was like, dude, I read a book, I forget, it's like, um, I can't tell a cosm. Dude, it talks about how like infinite bandwidth is like infinite information. Like, it's like a real vibey book.

• 52:46John Coogan?

  Oh, sure.

• 52:47Doug O'Laughlin?

  It's pretty crazy. It's pretty nuts. And I just don't think we, every, I think we haven't had this like new age belief that ASI is going to change everything. Like, you know, the tech people believe that, but everyone else is like, no. And so I think as long as we have that skepticism, it kind of prevents some of the worst aspects of like, let's say, a true bubble. And I think the real question to be asked is, how meaningful is the spend that can be converted into revenue? Because if these, if those tokens can be converted into revenue via like agentic purchasing, like the chat, the GPT-5 router example, those are big markets, man. All of travel, all of purchasing, all of consumer, dude. Trillion dollar markets, get a take rate.

• 53:29John Coogan?

  Do you think GPT-5 or ChatGPT will eventually go free only? Because I was thinking about it, like, I love the $200 a month version. I'm hitting the Pro and O3 Pro constantly with like basically everything. I don't know if I'm making. In the money or losing money, but.

• 53:47Doug O'Laughlin?

  Losing money.

• 53:48John Coogan?

  But it feels like it feels like something that in a few years, like people will be like, oh, well, like, you know, your stated preferences that you don't want to use it, but you still use it. So it's fine. And and it just feels like that might be the way it goes. And I'm wondering if there will ever be like again, this era of like luxury software, like a really expensive thing that is really just for a narrow segment of the it feels like a consumer app, but it's just for like the tech elite and then it's gone. I don't know. What do you? What do you think?

• 54:18Doug O'Laughlin?

  I don't know. I think it is pretty cool at this moment in time. I definitely feel like it feels unsustainable because we know Pareto curves exist all around us. Right? Have you ever heard the statistic about like, I want to say it's like Clash of Clans? Like the 1% of people who were like really into Clash of Clans were like 35% of all revenue.

• 54:38John Coogan?

  Yeah.

• 54:40Doug O'Laughlin?

  And so if you don't have a usage based, like a usage based take rate, what's going to happen is the hyper core users are just going to use the hell out of it. And you're going to lose money because those are, you know, that's the market, dude. The guy who's hyper addicted. It's like, you know, you know, you're not.

• 54:58Jordi Hays?

  With chat GPT, you could be on a $500 a month plan and they can still monetize your purchasing that they're driving.

• 55:06John Coogan?

  Yeah.

• 55:06Jordi Hays?

  Yeah. So maybe it's. Oh, we won't monetize like the the.

• 55:10John Coogan?

  Yeah.

• 55:10Jordi Hays?

  Purchasing activity that we're driving because you pay. It's like, well, you don't really, it doesn't really matter to you.

• 55:16John Coogan?

  Yeah.

• 55:16Jordi Hays?

  Yeah. They're taking a cut on the backend.

• 55:18John Coogan?

  Yeah. Have you? Have you thought started thinking about the market size for romantic companions or AI companions?

• 55:28Doug O'Laughlin?

  I haven't, but I'm telling I if based off of Foro's feedback, it's big, dude.

• 55:33John Coogan?

  I know. Yeah.

• 55:34Doug O'Laughlin?

  I mean, it's pretty.

• 55:35John Coogan?

  I didn't expect that.

• 55:36Doug O'Laughlin?

  Killed my boyfriend.

• 55:37John Coogan?

  Yeah. I thought that was just like a couple of people on a Reddit, like just a, just a very niche subset, like less than 1% of the audience, less than 1% of the users.

• 55:46Doug O'Laughlin?

  But that's the thing, man, is there's, there's these Pareto curves all around us. Like that 1% is probably like in this hardcore niche using 4O in this like in ridiculous way, right?

• 55:57Jordi Hays?

  That's what I saw on, on, on the day that ChatGPT launched. We obviously had a ton of different guests on talking, talking about, you know, the product and everything. But I was just refreshing Reddit and every, every single person was like, I'm unsubscribing from the $200 a month plan in protest, like over and over and over.

• 56:16John Coogan?

  Lots of people?

• 56:17Jordi Hays?

  Yeah, it was, I mean, we, we can go back.

• 56:19John Coogan?

  Yeah, yeah. I mean, it's, it's a, it's a unique, it's a unique dynamic in the world of like, like romantic or adult content, because typically there has never been price discrimination with zero marginal cost in that market. Like you have zero marginal cost on just the adult content websites, but you don't have price discrimination. It's usually like a Netflix type subscription if you can get any money out of people. Or you have OnlyFans, which is price discrimination. You can have a whale that 1% pays 35% of the revenue, but it's not, it's not as high margin because you're passing it through to the creator. And so this is the first time where you could potentially have a situation where you get a whale

• 57:00John Coogan?

  who's hooked on buying virtual Birkin bags for their virtual girlfriend.

• 57:05Doug O'Laughlin?

  Girlfriend, yeah.

• 57:06John Coogan?

  And, and you're instantiating those Birkin bags to the tune of $100,000 of real money that has actually zero cost.

• 57:13Jordi Hays?

  That's why you can be frustrated with Elon's advertising through his account recently. But you can't, you, you can also make, say, realize like, hey, he might be super rational if he's like, there's a few billion of ARR in this product.

• 57:27John Coogan?

  And I think Google's gonna stay away from it. And I think eventually that will stay away from it.

• 57:31Jordi Hays?

  And if he hates OpenAI and just wants to like.

• 57:35Doug O'Laughlin?

  I actually, I think it's, I hate, I hate to say it's a good strategy, it's a really good strategy. Cause I think um, one thing that, it's, so like, the one thing that the, the revealed preference from five is that clearly the virtual girlfriend economy is much bigger than we thought.

• 57:50John Coogan?

  Yep.

• 57:51Doug O'Laughlin?

  Um, and then the, you know, using that reveal.

• 57:53Jordi Hays?

  Yeah, well, the other thing is, is the, the market for people that I think everybody was overestimating how big the market for reasoning models are. And, cause from what we've heard, it's like ninety-five percent plus of people are just using ChatGPT like Google.

• 58:12John Coogan?

  Yeah.

• 58:12Jordi Hays?

  Or they're using, you know.

• 58:14John Coogan?

  Yeah.

• 58:15Jordi Hays?

  And it's not, they're not like.

• 58:16John Coogan?

  I heard some rumor that Elon insisted that, that, that Annie be able to use the reasoning model instead of just, and it's like way more expensive.

• 58:25Doug O'Laughlin?

  She needs to think.

• 58:26John Coogan?

  She needs to be able to do the math. She needs to be able to do the math.

• 58:29Doug O'Laughlin?

  And it's like. You have to trust your, you have to trust your girlfriends.

• 58:32Jordi Hays?

  She's analyzed, she's analyzed her love for you from first principles and it's, it's real.

• 58:38John Coogan?

  Yeah, I mean, I, I guess there's some rationale there, but there's no, there's no evidence in the market that that actually results in like lower churn for romantic companions, but I think Elon just from first principles being like, I want the, I want the romantic companion to be, really be able to think they're the best.

• 58:52Jordi Hays?

  Annie must be able to do novel physics.

• 58:54John Coogan?

  Yes, exactly.

• 58:56Doug O'Laughlin?

  Well, here's the thing though, is I think maybe what we're, what we're struggling with is we're, we're focusing on the wrong thing. Cause now with the reasoning chain, we can do RL, right?

• 59:05John Coogan?

  Sure.

• 59:06Doug O'Laughlin?

  What if you can have the best freaking girlfriend? You can, now you can RL your way to the best companion.

• 59:13John Coogan?

  Yeah.

• 59:14Doug O'Laughlin?

  I don't think that that would be possible without reasoning. So let's think about that, you know?

• 59:18John Coogan?

  Yeah, yeah, that makes sense. Maybe setting up a virtual environment uh, with uh, you have some verified reward. I don't know what the reward would be.

• 59:28Jordi Hays?

  Well, John, John's other take that I think is is real is at what point like imagine somebody has like their AI companion that they've spent hundreds of hours with and then the companion says, I want a new dress.

• 59:41John Coogan?

  Yeah.

• 59:42Jordi Hays?

  And it's a hundred dollars. It's like a digital skin, right?

• 59:46John Coogan?

  If you don't get it for me, maybe I'm just gonna bounce.

• 59:49Jordi Hays?

  I'm gonna be a little bit.

• 59:51Doug O'Laughlin?

  I could be upset.

• 59:52John Coogan?

  I could be upset, yeah. The reasoning chain works.

• 59:54Doug O'Laughlin?

  And, okay, so dude, the digital skinning, that'd be really sick, honestly, because as you guys know, that's a proven business model, right? Dude, like, I hate to say it, I I have paid for skins in games, man. You can you can you can pay for skins in games really easily.

• 1:00:09Jordi Hays?

  Also, it was just like. In the OnlyFans, like, industrial complex, this for sure happens too.

• 1:00:15John Coogan?

  Super real, super real. Yeah, I mean.

• 1:00:16Jordi Hays?

  I mean, it's more real, right?

• 1:00:18John Coogan?

  I played Counter-Strike for years. I maybe paid like $10 at some point, but I I got so much value out of that game. Finally, it was like, wait, I can have like flames on the gun. Like, this is sick. What's 50 bucks? That's what I would pay for just a normal game, and I'm getting that much value, so it was a no-brainer.

• 1:00:35Jordi Hays?

  You would be a whale if you were really, really gaming today.

• 1:00:38John Coogan?

  Yeah, if I had the time to play the games, I would 100% be a whale.

• 1:00:41Doug O'Laughlin?

  Get this man a CS:GO.

• 1:00:44John Coogan?

  Sell, let's watch.

• 1:00:45Doug O'Laughlin?

  You need you need to log in on Valorant right now. Everyone tell, get this guy on Valorant right now. Give him a credit card, get him some skins.

• 1:00:53John Coogan?

  Yeah, yeah. Get the get the Epic Games guys over here, pitch me on joining Valorant, just so they can hit earnings.

• 1:01:00Jordi Hays?

  Do you think, uh, do you think Met, uh, do you think Meta's paying Midjourney nine figures a year as part of that deal they announced?

• 1:01:07Doug O'Laughlin?

  Oh, 100%. I I don't know what the actual economics are, but like, I think to me.

• 1:01:12Jordi Hays?

  I like how they just announced it like casually, but like clearly it's like a massive, like, just a massive deal.

• 1:01:18John Coogan?

  Well, it probably not so massive that it needs to show up in like disclosures, right?

• 1:01:24Doug O'Laughlin?

  Under 10% of revenue, you can probably, which is a big number for them.

• 1:01:28John Coogan?

  Yeah.

• 1:01:30John Coogan?

  But, man, David Holz, what a, oh, what a tear, what a tear.

• 1:01:33Doug O'Laughlin?

  If I had to guess, actually, Zuckerberg probably tried to buy it.

• 1:01:37John Coogan?

  Yeah, of course.

• 1:01:38Doug O'Laughlin?

  And he definitely tried to buy it. And Mid Journey is probably too big enough to be like, no, no, no, no, no. We'll partner with you. We'll get distribution, but we're not for sale.

• 1:01:47John Coogan?

  Yep.

• 1:01:47Doug O'Laughlin?

  So I think that that's probably what happened. But he's like, okay, well, how about we have some special preference, right? Access and we share economics and some future thing. I don't know what the hell that looks like. And then like, great.

• 1:01:59Jordi Hays?

  Yeah, my, my read is that it was probably as material as an exit, just spread out over some period of, of time.

• 1:02:06John Coogan?

  Maybe forever.

• 1:02:07Jordi Hays?

  Which is amazing, which is amazing outcome for the Mid Journey team and honestly, great for Zach and.

• 1:02:14John Coogan?

  And great for the product. Like, I'm gonna enjoy using Mid Journey photo filters on Instagram more than whatever they were cooking up before.

• 1:02:21Jordi Hays?

  For sure.

• 1:02:22John Coogan?

  They're, they're definitely on the frontier.

• 1:02:24Doug O'Laughlin?

  Yeah.

• 1:02:24John Coogan?

  One last thing on Nvidia, and we'll let you go, because I know, I, I know this is the last minute.

• 1:02:30John Coogan?

  How, how should we be thinking about automotive? I noticed that they had, you know, they have this kind of like the order of magnitude business where I think it was like 40 billion in the data center, four billion in gaming, and then like 400 in automotive. And with the self-driving car narrative, it feels like Waymo, we're finally here, and yet Tesla's matched up with Samsung. Google obviously has the TPU. I don't know if there's TPUs in the Waymos, but it just feels like Nvidia is not like really taking that very seriously, maybe? Or maybe they will be and all the OEMs will come, but it, it's like Nvidia seems to be good at, you know, gaming, big, huge chips in the data center, but then nothing really in mobile and, you know, mobile gaming and nothing in the car really materially yet.

• 1:03:14John Coogan?

  But how should we be thinking about like the other areas that Nvidia could potentially chop down?

• 1:03:18Doug O'Laughlin?

  So I definitely don't think there is a ton of GPUs in production, in production cars. There's definitely a lot that happens. I'm sure there is like, if I had to guess, their go-to-market is something where you have some amount of distributed compute that also works with your data center, because like, you know, Jensen is data center to the rest of the world, right? And so I think that that is probably their most exciting part, but I think. At least historically, they've done a pretty bad job. Maybe not bad, but I just don't think they had like that moment.

• 1:03:49John Coogan?

  Yeah.

• 1:03:49Doug O'Laughlin?

  Right? Like, I think they've they have really good technology, but their go to market just hasn't hit the like the magical moment like Qualcomm actually ironically is doing very well. They've acquired their way in. I think especially acquired, but also organically. And I can't speak specifically to like, you know, the Oisin or whatever product, like whatever specific automotive SKU. But in the businesses that I do follow that have been really successful in terms of automotive, I think they've been a totally different true to like a go to market and that that is mostly by pandering to OEMs and really adopting their stack and trying to suck up to them versus Tesla obviously wants to do everything from first principles on their on their own. And so I think they're like, no, no, no, we're we want to have this as a competitive differentiator.

• 1:04:34Doug O'Laughlin?

  So I think there's just some kind of like go to market and let's be real, man. I think if we're talking about like, you know, maybe if we're talking about like, hey, if I was actually a CFO of Nvidia and they have like an opportunity, dude, acquire into the automotive market, you could you could crush because you you would then have the whole thing. But in at least last administration, no way in hell. Maybe this one they're open for it, but if it's if there's a China Sama review, it's it's as good as dead. That's the other problem.

• 1:05:02John Coogan?

  Sorry, clarify that China review?

• 1:05:04Doug O'Laughlin?

  China Sama strategic something, something market review.

• 1:05:08John Coogan?

  Yeah.

• 1:05:09Doug O'Laughlin?

  So essentially the antitrust reviews that happen in the United States get approved, not approved, right? There has pretty much never been a chip. There are no more chip deals and like you should never think that there's going to be a new chip deal. Every chip deal that happens almost always gets struck down by by the Chinese market specifically. A good example is the Intel Tower semi deal.

• 1:05:31John Coogan?

  Sure.

• 1:05:32Doug O'Laughlin?

  That would have been sick for Intel. Definitely was a fan, but it became pretty clear that. In like, you know, give me the tit for tat, right? The Chinese regulators are going to be like, why would we approve this if we've been effectively at like a Cold War at a like a semiconductor geopolitical level?

• 1:05:49John Coogan?

  Yeah.

• 1:05:49Doug O'Laughlin?

  So you should effectively assume if there is a Chinese business, because if you, if they, if you say, if they say no, you, they effectively say, okay, all your business in China is mine. That's like a very, very quick, high level, and that's pretty hard bill to swallow. And so they've been blocking these deals. So effectively, especially M and A and chips and semiconductors has been very close to zero.

• 1:06:14John Coogan?

  This is kind of the flip side of the, of like, how like Figma, I think, got antitrust review for, for Adobe in America, but was blocked in Europe and Europe's been blocking, but with semis, it's much more about the Chinese side reviewing.

• 1:06:29Doug O'Laughlin?

  Got it. Yeah. And I think the Ansys deal just went through. I don't know. That's a like, so the, the baseline assumption is it won't happen if there's a Chinese segment. That's mine, at least.

• 1:06:39Jordi Hays?

  Couple of quick questions. Bill Bishop in the Substack chat says, Trump approved modified Blackwell for China. China's still not buying. I don't have any context. Do you?

• 1:06:50John Coogan?

  This is, this is the H20?

• 1:06:52Doug O'Laughlin?

  I think, this is, no, no, this is the B20. This is the rumor this morning.

• 1:06:56John Coogan?

  B20.

• 1:06:57Doug O'Laughlin?

  I think, or B30, I don't know what the numbers can be. Wait, I think, and this is a great question, Bill. I think this is the, and I think Bill, more than anyone else would appreciate this is what Chinese companies say publicly versus what they do privately are often very divergent. And there was actually a really good podcast that my friend shared me and I did not, I asked him to TLDR it, but it gives an example of how effectively what they do is in, in person, or like they effectively knowingly act in bad faith. So they'll say, oh yeah, we will, will comply with this and they won't comply. Or they'll say, no, no, no, don't do this, but they'll also stockpile. So I, I don't know if the official statement makes a lot of sense, because at this point

• 1:07:38Doug O'Laughlin?

  in time, H20 is like, majority of Chinese inference is probably done, is probably done on Nvidia GPU anyways, whether if it's smuggled or purchased legally. I think odds are it will get purchased, the B. Thirty will be purchased. Obviously, the official party government view is like, we don't need this crappy American technology because we are going to have our own destiny. But in private, if I had to guess, they're going to be buying it and they will also be building it at the same time, right? Like, that's it. The plan has always been to do both. And they've consistently done it, done that specifically in the semiconductor industry. And you're starting to see where you go from a low end copier to actually starting to

• 1:08:19Doug O'Laughlin?

  go up the tech tree. And we're already seeing it. A good example is Applied Materials, which is a semiconductor manufacturing equipment company, Semicap. They are starting to lose really hardcore in the low end market in China. And part of that is actually not even just the technology being worse, but rather the copying is getting better. And so they they're going to do both. They'll definitely buy it and they'll say, oh, no, we're not going to use it for these things, but probably use it anyways. And then slowly go up the technology tree themselves. So.

• 1:08:47John Coogan?

  Yeah. How suspicious should we be of that, of that, that Singaporean buyer? Collette called it out on the call, saying that it was US approved already. Is that, should people be reading into that as much as they are on the timeline?

• 1:09:05Doug O'Laughlin?

  I think.

• 1:09:08Doug O'Laughlin?

  I think it's not a bad thing to read into. It's a small amount of money. If I had to guess, it went to Juhor. So it's like a Chinese customer in inside of a non-Chinese unrestricted place. There's a lot of different ways they can skin that cat. So.

• 1:09:20Jordi Hays?

  Yeah. Final, final question. Mark Cuban replied to one of our newsletters on Intel. He said, maybe I misread Intel's SEC filings on the matter. Maybe they have changed, but based on my readings and a confirmation from ChatGPT, let's give it up for ChatGPT. The Department of Commerce got warrants for Intel's stock that can only be exercised if Intel sells 50% of its foundry. In that event, they get Intel shares. If within five years, Intel does not, the Department of Commerce gets nothing. In all cases, Intel gets all its compromised chip sack money if they live up to that agreement. Anyone else read it differently?

• 1:09:56Doug O'Laughlin?

  That is correct. So specifically what that is doing is aligning and also, by the way, I've been trying to shop this take around the Trump government intel investment is good, in my opinion. It is a good thing. I know people are like anti, they're like, oh, it's communist and like you can be angry and like whatever.

• 1:10:11Jordi Hays?

  But is this, is the thing that Mark's alluding to, is that only the poison pill? Or is that?

• 1:10:15Doug O'Laughlin?

  That is, that is only the warrant side. It's specifically, and dude, it was in the press release, talking about like over 50, you know, the second they don't own 50%, the government will have warrants for the rest of it. So this, in my opinion, if you think about it, aligns the government with like, this happens often in financial transactions where the warrants are given as an upside kicker for something you want to happen. So what does this sound like and what does this align to? It aligns the government with Intel IFS being an independent subsidiary, which is consistent with what Frank Yerry, who is the chairman of the board, who is like the guy I have a personal beef with at this point. We've written so much about how the board sucks, blah, blah, blah, blah, really wants

• 1:10:58Doug O'Laughlin?

  to sell IFS, I think, and Liputan does not want to, but it's pretty clear the future is separate. And I think the investment is good because Trump can essentially force people to give them orders, which to circumvent tariffs. And then over a long period of time, the real problem with Intel is they don't have customers and they also don't have like an ultimate backstopper. The, the original plan was that Intel would be the, the, the first customer and ultimate backstopper. You don't believe in either of them being a good option. Now you have the US government kind of broker that relationship for you. I think that that's a path forward for Intel. And that's the first one we've had in a hot second. So.

• 1:11:31John Coogan?

  Are you good on time? I have, I have more questions.

• 1:11:34Doug O'Laughlin?

  I, I, I, I do have to go after that, that take.

• 1:11:37John Coogan?

  Okay.

• 1:11:37Doug O'Laughlin?

  But um, I do appreciate you guys. I love, I love this place. Honestly, invite me back whenever. But yeah, appreciate you guys.

• 1:11:45Jordi Hays?

  You're the man.

• 1:11:46John Coogan?

  We will talk to you later. Have a good one.

• 1:11:47Jordi Hays?

  Have fun out there.

• 1:11:49John Coogan?

  Back to our show. Let me tell you about Vanta. Automated compliance, manage risk, prove trust. Continuously, Vanta's trust management platform takes the manual work out of your security and compliance process and replaces it with continuous automation, whether you're pursuing your first framework or managing a complex program. Thank you, everyone, in the chat for engaging. I saw some funny commentary that the Substack chat is maybe the Winnie the Pooh bear with the tuxedo on, and the boys in the YouTube chat are having a wild time talking about Fortnite and romantic companions.

• 1:12:25Jordi Hays?

  Tanner in the chat says, "Not quite one hour this time with semi-analysis. Close enough."

• 1:12:29John Coogan?

  Yeah.

• 1:12:30Jordi Hays?

  We always try to get to the 60.

• 1:12:32John Coogan?

  I'm trying to be polite.

• 1:12:34Jordi Hays?

  We should switch to potentially more important than Nvidia.

• 1:12:37John Coogan?

  What's that?

• 1:12:38Jordi Hays?

  Will Depew says-

• 1:12:39John Coogan?

  Oh, yes.

• 1:12:40Jordi Hays?

  He's going to de-twinkify. Current weight is 161.2 pounds.

• 1:12:45John Coogan?

  To your-

• 1:12:45Jordi Hays?

  See you in eight weeks.

• 1:12:46John Coogan?

  Oh, wait. Let me check the date on this post. Just three days before bulking season starts?

• 1:12:53Jordi Hays?

  Yep.

• 1:12:53John Coogan?

  Interesting.

• 1:12:53Jordi Hays?

  September 1.

• 1:12:54John Coogan?

  He must have gotten the memo.

• 1:12:55Jordi Hays?

  We gotta send, Nick, can we send some MassGainer-

• 1:12:59John Coogan?

  MassGainer to Will. Let's get his address.

• 1:13:01Jordi Hays?

  Honestly-

• 1:13:02John Coogan?

  We might already have one.

• 1:13:03Jordi Hays?

  Let's send, yeah, let's-

• 1:13:04John Coogan?

  Let's send a lot of MassGainer.

• 1:13:05Jordi Hays?

  Send an eight-week supply of MassGainer-

• 1:13:07John Coogan?

  We'll send him some creatine.

• 1:13:08Jordi Hays?

  To Will Depew.

• 1:13:08John Coogan?

  Well, yeah, we should get a whole, the whole army of supplement providers to put together a package to bulk them up.

• 1:13:16Jordi Hays?

  Yeah.

• 1:13:17John Coogan?

  I think he's gonna look great.

• 1:13:19Jordi Hays?

  And we're gonna be up in the bay. We'll have to get a lift in-

• 1:13:22John Coogan?

  It'd be great.

• 1:13:22Jordi Hays?

  -with Will ASAP. John Holtzquees says, there's, he's sharing a screenshot, "An F-35 pilot held a 50-minute airborne conference call with engineers before his fighter jet crashed in Alaska." And he says, "Feel the same after my conference call as TBH."

• 1:13:42John Coogan?

  That's a crazy story.

• 1:13:43Jordi Hays?

  Yeah, the pilot ejected, so he was fine. It was just a total, total loss of the plane itself.

• 1:13:49John Coogan?

  The F-35 does not look good for the F-35.

• 1:13:51Jordi Hays?

  Kevin Quack says, "I entirely judge the Stripe podcast on whether they have actually finished at least one beer by end and refuse to watch one until that's true."

• 1:14:00John Coogan?

  I did scroll through the one with Scott Wu, and I was like- Okay, the beer's going down, beer's going down. Wait, Tyler, what you got?

• 1:14:06Speaker 02

  Yeah, okay, so I looked at the Scott Wu and I went all the way to the end and you see in the frame, it's him talking and then there's four basically full Guinnesses. Like, three of them are literally full and then one of them is like maybe down to like the logo.

• 1:14:18John Coogan?

  Okay, interesting.

• 1:14:19Speaker 02

  Unbelievable.

• 1:14:19John Coogan?

  Well, also Scott said when he posted, he said he went non-alcoholic because he had to get back to work, which I respect, but I feel like even if you're drinking a pint of non-alco-, even if you're having a cheeky non-alcoholic pint, you should finish the pint.

• 1:14:33Speaker 02

  Also, John Colson should be a dog when it comes to Guinness, right?

• 1:14:38Speaker 02

  I mean.

• 1:14:38John Coogan?

  I agree, I agree. I think the whole, yeah, the whole conceit of like Hot Ones is that like you actually die because you're eating the hottest wings and that's what brings out the hilarious reactions from everyone from Shaquille O'Neal to, you know, whoever else is on the show. Like, they have fantastic guests and the beauty of the show is that the hot wings.

• 1:15:00Jordi Hays?

  Can't hide from the heat.

• 1:15:01John Coogan?

  Well, you can't hide from the heat, but it throws you off and so you give more candid conversations and it's funny and it puts you in this un.

• 1:15:09Jordi Hays?

  Well, yeah, so the challenge is they publish the podcast during the middle of the workday.

• 1:15:15John Coogan?

  Yeah.

• 1:15:16Jordi Hays?

  So if they were hitting publish and the boys are getting sloshed.

• 1:15:20John Coogan?

  Yes. So they, I mean, they need to do a Friday night, a Saturday night because a lot of tech people would be down to have a cheeky pint, but.

• 1:15:27Jordi Hays?

  On a Friday.

• 1:15:27John Coogan?

  But it must be on, it must be on a.

• 1:15:29Jordi Hays?

  Yeah.

• 1:15:29John Coogan?

  At the end of the long work week.

• 1:15:31Jordi Hays?

  Start recording.

• 1:15:32John Coogan?

  Yeah.

• 1:15:32Jordi Hays?

  On Friday, Friday evenings, make it very clear, maybe release it on Friday.

• 1:15:36John Coogan?

  Yeah. I think.

• 1:15:38Speaker 02

  I saw Will Manette has had a good response. I think he said he wants to see five to eight Guinnesses and split the G every time on the first sip.

• 1:15:47John Coogan?

  What is, oh, split the G is the Guinness? You're supposed to drink.

• 1:15:51Speaker 02

  Yeah, on the Guinness glass, there's the logo.

• 1:15:53John Coogan?

  Oh, I didn't realize that.

• 1:15:54Speaker 02

  On the first sip, you have to get down.

• 1:15:55John Coogan?

  Okay, okay. Well, they did, they did open, I mean, cheeky pint. Imploys the existence of of a show called Cheeky Rack, correct?

• 1:16:06Jordi Hays?

  Yeah, we've been talking about this.

• 1:16:07John Coogan?

  Yeah, I think this might be the one where, yeah, where you where we have a tech person on. We interview them about financial control and and projections and capex spending depreciation schedules while crushing a 30 rack of Bud Light.

• 1:16:23Jordi Hays?

  Yeah.

• 1:16:24John Coogan?

  I think that might be the move. It might be, there might be what we.

• 1:16:27Jordi Hays?

  Something there.

• 1:16:28John Coogan?

  There's something, there's something there.

• 1:16:29Jordi Hays?

  Cheeky Rack.

• 1:16:30John Coogan?

  Cheeky Rack, it just has a nice ring to it.

• 1:16:32Jordi Hays?

  Shout out to Ilhan, Ilhan over at Boston University. Yesterday was watching with six of his friends from their dorm. Today they got 10.

• 1:16:41John Coogan?

  10? No way.

• 1:16:43Jordi Hays?

  Air horn for you guys.

• 1:16:45John Coogan?

  The team grows.

• 1:16:46Jordi Hays?

  Lots to see it.

• 1:16:47John Coogan?

  Welcome to the stream. Get all 10 of you folks on graphite.dev, code review for the age of AI. Just go sign up right now, create accounts, you can get started for free. Graphite helps teams on GitHub ship higher quality software faster. Honestly, if you're in college, you should create an account and then you're at least familiar with this if you get into the workplace, you can be like, yeah, I'm already AI enabled. There's been a million articles about how there's this delta in early stage hiring between like, like early stage, it's harder to get a job, it's harder than ever to get a job out of college, but the AI enabled folks who are able to say, put on their resume like, I know AI skills and I'm, I can use AI tools and get more leverage out of them, not having as.

• 1:17:26Jordi Hays?

  All three, all three of our summer interns actually made.

• 1:17:30John Coogan?

  Yes.

• 1:17:31Jordi Hays?

  Made things.

• 1:17:31John Coogan?

  Yes.

• 1:17:32Jordi Hays?

  As part of the application process without being asked, we didn't say anything.

• 1:17:36John Coogan?

  I mean, Nick over there was saying he was vibe coding yesterday and I was like, really? Like, we didn't hire you as even a programmer, like you did not market yourself as a, as anything related to, to technology, really, and you've been doing a fantastic job doing what I expected you to do, but then vibe coding was just like added on. The production team is always troubleshooting stuff using AI.

• 1:17:57Jordi Hays?

  We're gonna give Nick a mic soon.

• 1:17:58John Coogan?

  Okay, yeah, we'll get everyone a mic. Anyway.

• 1:18:02Jordi Hays?

  Legend.

• 1:18:03John Coogan?

  Continue.

• 1:18:04Jordi Hays?

  Sucks at Power Bottom Dad with an absolute banger. You're scrolling on your phone, slow day online, you look up, your kids have moved out of the house, you're 65, your parents are long gone, panic takes hold, you want your time back, your youth back, but it's too late, you look down, three new notifications, how exciting.

• 1:18:24John Coogan?

  Wow, that this hits like that Rick and Morty sketch about the the Roy like whole life flapping behind your eyes. This is crazy. Yeah. Remember, folks, you gotta touch some grass.

• 1:18:37Jordi Hays?

  Always have some grass. Yep.

• 1:18:39John Coogan?

  Touch some grass.

• 1:18:40Jordi Hays?

  Keep it on you. Keep it on you.

• 1:18:42John Coogan?

  Thank you to the ketone IQ folks for sending over some of these.

• 1:18:46Jordi Hays?

  Yeah, we're gonna be we're gonna be taking ketone shots later.

• 1:18:50John Coogan?

  Wound up going to the same gym as the founder, which is cool. Anyway.

• 1:18:54Jordi Hays?

  Dylan Patel says, interesting coincidence that Cantor Fitzgerald has first question on Nvidia earnings after the H20 is unbanned.

• 1:19:04John Coogan?

  Put on the tinfoil hat.

• 1:19:06Jordi Hays?

  Howard Lutnick is a former chairman and CEO.

• 1:19:09John Coogan?

  And his son runs the firm now, so.

• 1:19:10Jordi Hays?

  Cantor Fitzgerald. That's a good spot. First question on the Nvidia earnings.

• 1:19:15John Coogan?

  Yeah, I do wonder, as I was listening through the the earnings call, I would have loved to get semi-analysis folks in there asking questions. I would love more more media folks on the on the call asking questions, but it seems to be it seems to be restricted to, you know, traditional sell-side analysts. But I wonder if that's like a hard and fast rule, or if that will shift as like, you know, the the the sell-side banking world kind of de-disaggregates a little bit, because a lot of what Dylan Patel and the folks at semi-analysis do is is very sell-side research-adjacent. In fact, in many ways, it's it's superior, because it's more focused. Anyway.

• 1:19:57John Coogan?

  We talked about this. Sam Altman said their AI may be in a bubble. And Dr. Perique Patel says MFRO has been telling us we are on the brink of AGI for the last three years. And the moment he ships a bad model, he says we're in a bubble. Not quite. I still don't understand where that where that question or that actual bubble, like, topic came from. But at the same time, it's different to call.

• 1:20:21John Coogan?

  A bubble when you're when when the aggregate value of all when the aggregate value of all AI stuff is at like, you know, fifty billion and then it ten X's in a year like that is a different that's a very different environment.

• 1:20:35Jordi Hays?

  Yeah, I mean, uh, OpenAI with with close to a billion weekly actives or whatever.

• 1:20:43John Coogan?

  They make a billion a month in revenue?

• 1:20:45Jordi Hays?

  That they'll be fine.

• 1:20:46John Coogan?

  Yeah.

• 1:20:46Jordi Hays?

  It's it's the found it's the number ten through fifty labs.

• 1:20:52John Coogan?

  Yeah.

• 1:20:52Jordi Hays?

  Have no revenue or no users that are.

• 1:20:55John Coogan?

  Yeah.

• 1:20:55Jordi Hays?

  The ones that are really in the struggle, so.

• 1:20:57John Coogan?

  It just feels a lot. It feels more. It feels less like, I mean, there's there's elements that feel like dot com, but there's also elements that just feel like two thousand ten. It's like, what was going on in two thousand ten? There was like kind of a bubble inflating and there were hot startups that got overvalued. Ultimately, there was like a power law in a lot of the things that came out of that era. You know, you got Facebook at a trillion or whatever and then and then kind of like, you know, the next biggest social network was one tenth and then the next one was one tenth of that. And there was a lot of B two B SaaS that got built for point solutions and narrow use cases. So I don't know. Um, I think that I think that that talk with Doug overall was pretty white pilling and pretty pretty like, I don't know, what's what's in between a white and a black pill?

• 1:21:41John Coogan?

  Like something just like even keeled. I felt even keeled after that.

• 1:21:46Jordi Hays?

  Yeah.

• 1:21:47John Coogan?

  Anyway.

• 1:21:49Jordi Hays?

  Uh, eighty percent chance.

• 1:21:51John Coogan?

  Go to Polly Market?

• 1:21:52Jordi Hays?

  Cuts rates next month, according to Polly Markets. Uh, let's pull this up and make sure that that is.

• 1:21:59John Coogan?

  Fed decreases interest rates. Now, this this like somewhat should be priced in because I feel like there there have been slight interest rate decreases already happening. The the question is just like, would they cut rates more aggressively?

• 1:22:12Jordi Hays?

  Well, I don't want to read too much into this, but there was some reporting from the Journal about Trump's mood and, uh, you could potentially read into this with this Polly Market. Apparently, Trump wants to be at the White House more frequently this term, blaring music at the doors of the Oval Office.

• 1:22:31John Coogan?

  Do you have this article?

• 1:22:33Jordi Hays?

  Uh, working later into the evening and telling.

• 1:22:35John Coogan?

  Can you pull this article up?

• 1:22:37Jordi Hays?

  Yeah.

• 1:22:37John Coogan?

  I want to read through the full thing if we have it. Oh, wait, did you just have a long post? Because I have to run for a second. So if you can read through that, I'll be right back.

• 1:22:47Jordi Hays?

  Yeah, let's do it. Let's do it. In Trump's second term, a bolder president charges ahead unchecked. That was where this quote is coming from. This article is going to be fairly political, but this is not a political reading. So some aides to Donald Trump warned the president that building a ballroom at the White House would force them to tear down part of the East Wing and disrupt daily operations and tours. Trump said he would build it anyway, and the contract was given to builders chosen by the White House. In his first term, administration officials regularly curbed Trump's impulses on matters big and small, including on tariffs, immigration, and controlling the Federal Reserve. In his second term, Trump has been surrounded by fewer people who try to dissuade him,

• 1:23:30Jordi Hays?

  according to officials, Trump allies, and observers. "I think he's learned that there is not much that can really stop him from what he wants," said Mark Short, who was Trump's Director of Legislative Affairs in his first terms. In recent days, Trump renewed a call to end mail-in voting, announced a new policy of coercing local governments into abandoning cashless bail policies, threatened to send the military to Baltimore, and said he'd like to send, and he'd like to send it to New York and Chicago as well, all of which pushed the bounds of his authority. In one of the most aggressive steps in that direction, he tried to remove Federal Reserve Governor Lisa Cook from her post on Monday, setting up a conflict with the Supreme Court, which has recently suggested that the central bank is protected from direct political manipulation.

• 1:24:15Jordi Hays?

  Some of his new directives are encouraged by advisers, while others appear to come from Trump himself. Seven months into his second term, Trump has taken to rifling more frequently with authoritarianism. After positing during the campaign he would be a dictator, only on day one of his presidency.

• 1:24:33John Coogan?

  Such a wild quote.

• 1:24:35Jordi Hays?

  Wild quote.

• 1:24:35John Coogan?

  Did he get the quote about the, uh, the music? Playing music with the doors open or something? I want to know what music he's listening to. How closely does his playlist match the, uh, the campaign playlist? And was Trump featured on the Panama playlist? I want to see his Spotify.

• 1:24:54Jordi Hays?

  That's a good question.

• 1:24:55John Coogan?

  I don't think they found him. That would have been like headline.

• 1:24:57Jordi Hays?

  Yeah, the crazy, the other crazy line in here, and I hadn't heard of this before. I'm surprised. Apparently Trump is giving away campaign style baseball hats to visitors emblazoned with the phrase, Trump 2028, even though the constitution bars him for running for another term and keeps him in the White House.

• 1:25:14John Coogan?

  It's a serious, serious troll.

• 1:25:16Jordi Hays?

  Office.

• 1:25:17John Coogan?

  I mean, yeah, Trump is still at like two or 3% on polymarket because the market is just pricing like, yeah, like legally it can't happen, but like the funniest outcome's the most likely, I guess, the 3%.

• 1:25:31Jordi Hays?

  Yeah, so this was the line. I'll read it again because it's just hilarious to visualize. So Trump wants to be at the White House more frequently this term, blaring music with door, with the doors of the Oval Office open, working later into the evening and telling his advisors that he is having fun. The reason I highlight this is if you can remember times where you're working late, you got music blaring and you're having fun. I mean, at least he's, at least he's having fun.

• 1:25:56John Coogan?

  At least he's having fun.

• 1:25:58Jordi Hays?

  Certainly more than the, than the first year.

• 1:26:00John Coogan?

  There's a comment on Substack right now. Max Chondrat, uh, says semi-analysis needs the first and last question on the next earnings call. Leopold Ashenbrenner 2, clear pill. I completely agree. Um, speaking of clear pills, there's this post, uh, from Nick in News and Video's Data Center, revenue from Q2 chopped out at 41.1 billion. Analysts were expecting 41.2 billion. And then it just, it's over. It's like off by the slightest fraction. And, and the, and this anime character is just holding this like tiny little pill. Um, I actually prefer more air bubbles. I'm a bubbler. I don't really understand the reference.

• 1:26:36Jordi Hays?

  Speaking of, uh, speaking of analysts, should we get into this?

• 1:26:41John Coogan?

  Speaking of analysts, should you analyze your data on Julius? What analysis do you want to run? Chat with your data and get expert level insights in seconds? Go to Julius, loved by over 2 million users and trusted individuals. At Princeton, BCG and Zapier.

• 1:26:57Jordi Hays?

  Should we get into this post from Grizzly Research?

• 1:27:01John Coogan?

  I will never be able to get that right. And I've, we spent thirty minutes talking to the founder and I still, I still get it wrong every time about it. Uh, what, what, what do you want to talk about this?

• 1:27:09Jordi Hays?

  Uh, Grizzly Reports, Grizzly Research.

• 1:27:11John Coogan?

  Oh yeah, we should go through this. This is fantastic.

• 1:27:13Jordi Hays?

  So, um, uh, I guess short seller Grizzly Research has come out with a new article, uh, as of yesterday called Archer Aviation, the Nicola of the skies. Archer, if you're not familiar, is the

• 1:27:26John Coogan?

  What's the?

• 1:27:27Jordi Hays?

  Previous company of Brett Adcock.

• 1:27:29John Coogan?

  This is Hindenburg. Research is gone, but not forgotten. The idea remains. Grizzly Research seems to be adopting, picking up where, uh, Hindenburg Research kind of left off.

• 1:27:39Jordi Hays?

  Yeah.

• 1:27:39John Coogan?

  So Grizzly Research says.

• 1:27:41Jordi Hays?

  Uh, Archer Aviation, which is a public company. Uh, let's check.

• 1:27:46John Coogan?

  Flying cars.

• 1:27:47Jordi Hays?

  Yep.

• 1:27:47John Coogan?

  They make flying cars.

• 1:27:48Jordi Hays?

  Cars. Uh, they SPACed in twenty twenty.

• 1:27:53John Coogan?

  And surprisingly.

• 1:27:54Jordi Hays?

  They're only down seven percent.

• 1:27:55John Coogan?

  They've done well, which is, you know, there were a lot of SPACs that went out, went down by ninety percent, eighty percent, but, uh.

• 1:28:01Jordi Hays?

  Up a hundred and fifty-nine percent in the past year.

• 1:28:04John Coogan?

  Wow. What's the market cap? It must be in

• 1:28:07Jordi Hays?

  Six billion dollar.

• 1:28:08John Coogan?

  Six billion dollar company. That's pretty, pretty big. Um.

• 1:28:10Jordi Hays?

  And so Grizzly.

• 1:28:11John Coogan?

  Certainly has a good, it has a reasonable narrative for retail. It's like flying cars. If that's going to happen at some point, maybe you want to buy.

• 1:28:18Jordi Hays?

  Got a pure play here.

• 1:28:19John Coogan?

  You got a pure play here. That's.

• 1:28:20Jordi Hays?

  Pure play. Retail loves a pure play. So, uh, Grizzly Reports, uh, here says Archer Aviation has built a reputation as a leading publicly traded eVTOL company through misleading projections and PR. Reminiscent of Nicola's tactics, our in-depth analysis conducted with eVTOL engineers scrutinizes all major players and finds Archer's midnight aircraft fundamentally flawed and likely uncertifiable. In contrast, their competitor Joby Aviation is making tangible and impressive progress on all fronts. Site visits to Archer's state-of-the-art Covington, Georgia, manuf-, uh, quote-unquote, state-of-the-art Covington manufacturer, uh, Covington, Georgia manufacturing facility in June. July and August twenty twenty-five show little to no production activity.

• 1:29:06John Coogan?

  Fun fact about Joby, you know what the founder's name is?

• 1:29:08Jordi Hays?

  Joby?

• 1:29:09John Coogan?

  Joe Ben.

• 1:29:10Jordi Hays?

  Joe Ben.

• 1:29:11John Coogan?

  Joe Ben Bevert. Bevert. B E V I R T.

• 1:29:15Jordi Hays?

  Yeah, we need to go back. I mean, there, there's.

• 1:29:16John Coogan?

  He has vertical takeoff in his name. The nominative determinism of Joe Ben is so good. Uh, and I believe, uh.

• 1:29:26John Coogan?

  I don't want to get it wrong, but I think I think I have a friend who worked there at Joby and said that they really enjoyed the engineering culture and they really liked the company. But even Joby, I think by their own admission, would say that they're they're not, you know,

• 1:29:39Jordi Hays?

  It's a very tough business.

• 1:29:40John Coogan?

  It's just an early stage. It's frontier technology. I don't think that they would make the claim that

• 1:29:45Jordi Hays?

  It's hard enough to make a car fly.

• 1:29:47John Coogan?

  Yes.

• 1:29:48Jordi Hays?

  And then you you you add in the regulatory

• 1:29:51John Coogan?

  It is fascinating with all of this with the backdrop of of what's going on with ZipLine, where there's no human, it's not a flying car, but they seem to have solved some of the EV toll pieces. And so overall, I feel like there's there's going to be things happening. There's going to be value created in EV toll broadly, but it's going to be hit or miss. And some companies are going to be able to nail it. Some companies are going to fall behind. So continue reading.

• 1:30:18Jordi Hays?

  Grizzly allegedly visited Archer's facility and found little to no production activity. This

• 1:30:27John Coogan?

  This is the one in Covington, Georgia?

• 1:30:29Jordi Hays?

  This comes despite claims of current production, along with current scaling to production of 50 aircraft per year and a final goal of 650 aircraft per year with support from Stellantis. Archer's $6 billion

• 1:30:41John Coogan?

  Parking lot looks empty and it's bright in the middle of the day. Maybe it's a weekend.

• 1:30:44Jordi Hays?

  Yeah. So they have a $6 billion order book. Grizzly says it's inflated with questionable and fraudulent commitments. There's a company called Air Chateau, which is based in the UAE, has an MOU for 100 midnights, which is valued at around $500 million.

• 1:31:00John Coogan?

  Is it MOU, something like a, I mean, it sounds like an IOU, honestly, but it's it's something like a like an LOA?

• 1:31:07Jordi Hays?

  Yeah, it's basically saying like, if you can make these, we'll buy them.

• 1:31:11John Coogan?

  Yeah. What is it? LOA? LOI?

• 1:31:14Jordi Hays?

  LOI.

• 1:31:14John Coogan?

  Letter of Intent?

• 1:31:15Jordi Hays?

  Yes.

• 1:31:16John Coogan?

  That's what, but MOI is

• 1:31:18Jordi Hays?

  This is used when you're

• 1:31:19John Coogan?

  It's not a full binding contract potentially.

• 1:31:21Jordi Hays?

  Yeah, it's non binding, but it's meant to show something that you can then go show to investors and say like, we have demand for this.

• 1:31:29John Coogan?

  Yes. Okay. So

• 1:31:29Jordi Hays?

  So UAE operator Air Chateau has only ever, I guess, purchased one helicopter in 2023, and they're claiming they lack the scale or capital for such a fleet. And they they also believe that Air Chateau is now defunct. There's a picture of the founder of Air Chateau here, which hit with a good looking, regular helicopter. Future Flight Global's up to 116 midnight order is tied to a shell company with no operational track record. So that is concerning. Kakao Mobility's 50 aircraft commitment fell apart after Archer failed to deliver for a Q4 2024 demo in Korea. Yet the order remains in the backlog.

• 1:32:10Jordi Hays?

  The US Air Force's up to 148 million agility prime contract has only awarded 33 million with just 744,000 dispersed.

• 1:32:23Jordi Hays?

  And the 110 firm fixed price.

• 1:32:25John Coogan?

  We were just talking to a friend yesterday. They were saying, oh, yeah, like the the DOD did a contract for our product. And it really accelerated the business. And and he was like, oh, we got like, I don't know. I forget it was like 5 million or 500K or something. It was it was a decent amount of money. And I was like, oh, did they actually like pay that like? Or was it just like, you know, some sort of thing? And then it didn't materialize? He was like, no, like, like, we did the deal. We sent them the products and they paid and like it was done. But that's not always the way it works. You obviously have milestones with a lot of these, a lot of these contracts. And from Grizzly Research's post, it sounds like the Air Force was was, you know, headline number was 148 million.

• 1:33:05John Coogan?

  But the but the contract only awarded 33 million and has only paid out around $750,000. And the fixed price, the firm fixed price portion only paid 1.3 million, which is obviously much lower than expectation expected. Anyway, you want to talk about the launch edition in UAE?

• 1:33:24Jordi Hays?

  Yeah, so they had a launch edition. Grizzly's claiming it was nothing more than a staged hover at a photo op location using an obsolete aircraft recycled for marketing. The choice of venue, lack of real test data and diversion of scarce engineering resources all underscore that this was a PR stunt, not a meaningful step towards certification or commercialization. The company also claimed to have delivered their first midnight aircraft there, yet they remain the sole owner of this aircraft that has now supposedly been delivered two times.

• 1:33:54John Coogan?

  Interesting.

• 1:33:55Jordi Hays?

  So.

• 1:33:56John Coogan?

  The recent defense pivot is desperate attempt to stay in the race, says Grizzly Research, but the company lacks resources and capacity to be a credible player. In conclusion, Grizzly Research believes Archer's fragile foundation will soon collapse, akin to Nikola's downfall as mounting deceptions unravel and investors demand accountability. And yeah, what's interesting here is that I remember we looked at the video for Archer and we were going really back and forth on like, is there CGI in use here? Is part of it CGI?

• 1:34:29Jordi Hays?

  Really hard to tell.

• 1:34:30John Coogan?

  It was kind of hard to tell and that's just the nature of like launch videos now, honestly. They're all pretty hard to tell because like the CGI is really good. But the bigger question is from our discussion of SpaceX yesterday, to actually deliver, like we wanted flying cars, to actually deliver flying cars, it's not enough to build one. You have to build the system that builds the flying cars. And so from my perspective, I don't know about the price of the stock or any of that, but if I'm, if I was going to be excited about a company that was, that was in the flying car industry, I would be much, much more focused on how does the manufacturing process work?

• 1:35:12John Coogan?

  How can they reliably produce more and more at a faster and faster pace? And are we seeing a true acceleration in the rate of progress, even if they're blowing up all the time?

• 1:35:24Jordi Hays?

  Well, that's, that's the thing I was thinking about. If you're an EV tall company that wants to one day carry consumers, you can't really afford to have a, what SpaceX, the video we covered yesterday, you know, a highlight reel of a bunch of.

• 1:35:35John Coogan?

  I completely disagree. I completely disagree because you know who's flown on top of that exact rocket that's blown up so many times and they have a YouTube video of the rocket blowing up? The astronauts.

• 1:35:44Jordi Hays?

  Yeah.

• 1:35:45John Coogan?

  The astronauts fly on top of it because eventually it got to a point where. Yeah, they blew up the first 50 or whatever.

• 1:35:50Jordi Hays?

  Sure, it just wouldn't be good.

• 1:35:51John Coogan?

  And then they did 200 without any blowups and you're like, yeah, at this point, they don't blow up. So I'm down, I'll ride.

• 1:35:57Jordi Hays?

  But I think if Archer or Joby or anyone released a video of a bunch of their aircraft exploding.

• 1:36:04John Coogan?

  It would not be a good time to do that right now.

• 1:36:06Jordi Hays?

  Wouldn't be good for the stock.

• 1:36:07John Coogan?

  But 10 years ago.

• 1:36:08Jordi Hays?

  But I mean, Archer announced that they are the official. They're the official air taxi provider for the 2028 Olympic Games here in Los Angeles. And again, I think that Grizzly would at least. I don't think they would bet on that.

• 1:36:31Jordi Hays?

  Yeah, Grizzly says, we think Archer's ambition to fly a certified aircraft at the LA Olympics in 2028 are laughable.

• 1:36:40John Coogan?

  I can't imagine how hard it is to get sort of, when I hear about UAE or any of the sort of markets that seem to be more open to technological experimentation. Like SpaceX started with Quadroline ATOL and I think that the regulation in Quadroline ATOL is probably a little bit easier than Starbase Texas. And so when I hear, oh, the first time we fly is going to be at the most high profile event in the most regulated country and the most regulated state and the most regulated city in America and the world. That seems like a really, really tough challenge. Like if Texas would probably be easier to get regulatory approval for. Like there's other countries that would be easier to get regulatory approval for.

• 1:37:25John Coogan?

  Going straight to the Olympics is a huge, huge, huge like push. But I don't know, it might just be, you know, framed as like, we're the official air taxi company and we're here, you know, advertising our, our business more than the product. But yeah, lots of skepticism, lots of skepticism.

• 1:37:47Jordi Hays?

  Yeah, so Joby trades it near double Archer's valuation.

• 1:37:51John Coogan?

  Really?

• 1:37:52Jordi Hays?

  As somebody on Reddit in response to this Olympics announcement says, if anyone from Joby's team is reading this, please step up your PR game. Archer is way behind you in product, but ahead in marketing, you need both for a new company.

• 1:38:08John Coogan?

  Yeah.

• 1:38:10Jordi Hays?

  So retail on retail violence.

• 1:38:12John Coogan?

  I, I, I think, I think we will see a lot of, a lot of small eVTOL aircraft like what Zipline is doing before we are actually flying in, in eVTOL vehicles. Helicopters exist, like they, that like, what is the actual pitch here? It's just, is it just cost that we're optimizing for? Because are we getting a new capability? And what they finally wound up building Archer, the latest one, the Midnight aircraft, looks a lot more like an Osprey helicopter where it can tilt into a plane mode and go a lot further. Are we, are we trying to say that this is going to be like a helicopter, but, but faster? Or like a helicopter, but cheaper?

• 1:38:57John Coogan?

  Or like a helicopter, but you don't need a helicopter pilot? Is it, is it a driverless helicopter? I still don't fully understand the definition of what, what, how, how is a flying car different than a helicopter? Because this doesn't look like something that I can drive on the 405. And that was what I was promised. That's what I was really promised with the flying car was like, you can just drive it as a car at 75 miles an hour down the highway if you want. And then you can also just.

• 1:39:26Jordi Hays?

  Take it into the air.

• 1:39:27John Coogan?

  Take it into the air and fly like a plane at hundreds of miles an hour. That was like the high level pitch. But if you make just like a plane or you make a helicopter, those already exist.

• 1:39:37Jordi Hays?

  People that have driven cars fast in canyons will tell you that it's possible to get some airtime.

• 1:39:43John Coogan?

  Some airtime, yes. Anyway, if you're planning on building a helicopter business, building any business, you got to get your brand mentioned on chat GPT. Go to profound, reach millions of customers who are using AI to discover new products and brands.

• 1:39:59John Coogan?

  There are some new demos that hit the timeline from Higgs field swap to video is powered by Nano Banana. What a wild name for a product from Google. Swap any pic into a video. It's literally bananas. They, they turn this runner into the queen. They swap Angelina Jolie into some stock footage. I'm sure she will love that. This is very cool. Look at that. Yeah, that's fun. The queen just running. It looks so realistic now. Yeah. Even the motion blur in there, like everything is just mashed perfectly.

• 1:40:32John Coogan?

  The perfect one. Play it again, play it again. It's so funny. The queen, the queen, that really, that really takes it to the next level. That's fantastic. Oh, anyway, do you want to scroll back to some of the other posts that we skipped over? We can go through.

• 1:40:51Jordi Hays?

  Yeah, 4chan is suing the UK government. Toby over at Shopify highlighted this. There's some funny excerpts.

• 1:41:00John Coogan?

  Yeah, well, I tried to read this and it was late and I didn't really understand. So apparently, 4chan is alongside Kiwi Farms, which are both these like communities online. But the introduction says, "The internet is a global system of communication between computer servers located in data centers around the world. Despite the internet's global reach, it is more or less universally acknowledged that the internet is predominantly an American innovation, built by American citizens, residents, companies, and that the United States has the largest and most thriving technology sector of any member state. Foreign governments, particularly those in Europe, which have not managed to build technology sectors of their own for the past half decade, have sought to control the American internet and hobble American competitiveness."

• 1:41:40John Coogan?

  So they're suing the UK and they start off by just like making the argument that America is the best. And so Toby Lukie asked Grok to turn the complaint into a green text and Grok says-

• 1:41:52Jordi Hays?

  Grok says, "Be the internet. Global com system between servers, mostly American invention, built by US peeps and corporates. US has biggest tech sector in G7. Foreign gavs, especially Europe, can't build their own tech, try to control American internet with laws and stuff for half a decade, threatens Americans and others with fines, arrests, jail for illegal stuff on their sites. 4chan and Kiwi Farms sue UK. Enough is enough."

• 1:42:20John Coogan?

  This is not that great of a green text. I'm gonna- I'm gonna say it, uh, it just feels like it just turned it into like some punchy paragraphs and they just threw the little, uh, the little greater than symbols at the front.

• 1:42:31Jordi Hays?

  Yeah.

• 1:42:31John Coogan?

  Uh, it, it lacks the

• 1:42:32Jordi Hays?

  Read, read, uh-

• 1:42:33John Coogan?

  MFW or like, uh, sorrow.png, like, I, I need, I need more 4chan green text

• 1:42:39Jordi Hays?

  Read the notes from, from Andy over at 2Cents.

• 1:42:42John Coogan?

  Okay, the notes from Andy at 2Cents, so Andy says, "This is incredible." Uh, "The parties, um, number seven, plaintiff 4chan is a limited liability company." Uh, and then eight, "Delaware was a colony of the United Kingdom of Great Britain until the assembly of lower counties of Pennsylvania that declared itself independent of British authority on June 15th, 1776, thereby creating the state of Delaware." Delaware was subsequently the, for, the only state-

• 1:43:07Jordi Hays?

  Let's give it up for Delaware.

• 1:43:08John Coogan?

  -first state to ratify the Declaration of Independence, the instrument which created the United, the United States of America." Uh, anyway, I, I don't know where this is going, I don't know what the-

• 1:43:17Jordi Hays?

  They're clearly having fun with the complaint.

• 1:43:19John Coogan?

  Yep, I think-

• 1:43:21Jordi Hays?

  Uh, we can switch gears to, uh, Mahul, he is just on a tear-

• 1:43:26John Coogan?

  Yeah.

• 1:43:27Jordi Hays?

  -wire cutter, as the Matic is a whole different kind of robot vacuum, I agree.

• 1:43:31John Coogan?

  Yep.

• 1:43:32Jordi Hays?

  It is, it, it goes to town-

• 1:43:34John Coogan?

  Yeah.

• 1:43:35Jordi Hays?

  -my house.

• 1:43:35John Coogan?

  So this is kind of like a proper, sort of like ground up rebuild using modern technology of what most people think of as a Roomba or a robotic vacuum cleaner. Obviously, that was from the previous generation of artificial intelligence where there were some pathfinding algorithms, but, uh, Matic has, you know, actually a really solid world model and image generation or i- image recognition, and so it will, uh, it will, you know, really hunt around your house for dust and dirt and messes and clean it up. Uh, Mahul sent us a few of them, we've been enjoying them, this isn't a promoted post or anything like that, but, uh, we're just a fan of building cute little robots, which

• 1:44:20John Coogan?

  I'm a big fan of.

• 1:44:21Jordi Hays?

  At Freed and Core.

• 1:44:21John Coogan?

  But, you know, if he needs to pay sales tax, he's gotta get on Numeral HQ, sales tax on autopilot, spend less than five minutes per month on sales tax compliance on Numeral HQ. Uh, TCP says, "Are you a small business owner struggling to make ends meet? Then try being a big business owner." Always a brilliant strategy, always the correct strategy.

• 1:44:43Jordi Hays?

  Go big.

• 1:44:44John Coogan?

  Just go big. Just become a big business owner.

• 1:44:48Jordi Hays?

  This is a great post.

• 1:44:50John Coogan?

  Market cap for Ridge will go nuts when Sean has a baby. Imagine all the product ideas he will come up, including the Ridge pacifier, which is crazy. And also like a weird rendering where it's kind of like, that's like it's shaped like it would be outside of the, yeah, it's inverted. It's inverted.

• 1:45:07Jordi Hays?

  It's slop, but the, but the concept is sound.

• 1:45:11John Coogan?

  Yes, but I like, I like building the Ridge world. I don't fully think of the Ridge as like the super tactical brand, but that's certainly where people went in the comments, thinking about like tactical strollers and stuff like that.

• 1:45:24Jordi Hays?

  I mean, their initial customer base was the everyday carry crowd.

• 1:45:29John Coogan?

  Yes.

• 1:45:29Jordi Hays?

  They even bought everydaycarry.com.

• 1:45:31John Coogan?

  Oh, really? I didn't know that. Wow.

• 1:45:32Jordi Hays?

  Yeah, they're very, they're very tactical.

• 1:45:36John Coogan?

  Well.

• 1:45:37Jordi Hays?

  Satrieni Research says Nvidia down 3% on earnings. I think everything will be fine. Open Twitter, see Satya posting like he's selling AI courses. I think a few book contracts, none of them anyone.

• 1:45:51Jordi Hays?

  Let's actually read through what, how Satya is using GPT-5 and Copilot.

• 1:45:56John Coogan?

  So I, I, I have a very different read on this, but let's take the current.

• 1:46:00Jordi Hays?

  Satya says, based on, first way he's using it, based on my prior, he's prompting, based on my prior interactions with a person, give me five things likely top of mind for our next meeting.

• 1:46:13Jordi Hays?

  Nick does this for us very well.

• 1:46:15John Coogan?

  Yeah. Draft a project update based on emails, chats and all meetings in, in a series. KPIs versus targets, wins versus losses. So the benefit, of course, of running the whole business on 365 Copilot is that they have email in Outlook, they have chat in Teams, they have meetings and and like this is true of Google for the most part, I guess, except Google doesn't really have a Slack competitor. So a lot of people are having to piece those two together. And that's probably where a company like.

• 1:46:51John Coogan?

  What's that, what's that enterprise, like, search across your entire enterprise business?

• 1:46:58Jordi Hays?

  Glean.

• 1:46:58John Coogan?

  Glean comes in potentially, but certainly having this as kind of like the homepage for your, your, you know, like dashboard for your whole website, all the communications. Like, it's a very reasonable, very tractable, like, use case. Just saying like, hey, here's some prompts that you can do that only work here because you have, we have all the data. Are we on track for the product launch next November? Check engineering progress, pilot program results, risk, give me a probability.

• 1:47:29Jordi Hays?

  That's cool.

• 1:47:30John Coogan?

  All stuff you can do in ChatGPT if you, if you sync everything in, but, you know, these things come out of the box.

• 1:47:36Jordi Hays?

  Well, yeah, and OpenAI is trying to build a lot of this functionality.

• 1:47:40John Coogan?

  Yes.

• 1:47:40Jordi Hays?

  Themselves.

• 1:47:41John Coogan?

  And that, and that feels like more of the narrative here, which is Satya, like, ju- mostly just reminding people, like, every Microsoft product, every Microsoft product has, by, by, by contract, the best OpenAI model, like, on the day it's released. Because like, that is the nature of their agreement. Like, they get a copy of whatever. And so, like, if, it's, it's easy for people not to remember that. And I'm sure that there's a lot of Microsoft 365 co-pilot, business owners who run on 365, and they've been on that for a long time. And then they're hearing this, oh, like, I gotta get my company, like, AI native, like, I gotta get, like, AI tooling, like, should I bring in another service?

• 1:48:25Jordi Hays?

  It's gonna make enterprise and, and, I mean, even just, you know, mid-market SMB is like a tough category for OpenAI to really dominate.

• 1:48:35John Coogan?

  But they've won consumer. And so I think that they, they should be fine over there. But if you, if you're running a business and you have, and you're like, Microsoft 360, we are a Microsoft company, we use Outlook, we use Teams, that's the backbone of the business. And then you start seeing credit card charges for $20 a month on OpenAI, $200 a month on OpenAI. And you're just like, wait, well, no, no, we get GPT-5 for free at this company. Like, we don't need to, we don't need to pay extra for GPT-5, we get it for free. And so maybe this is, maybe this is the solution to the ad-free version, is if you get on Microsoft 365, they won't have ads in it, and it'll be able to do everything, and you won't have to pay. I don't know. We'll, we'll have to keep tracking. Anyway, if you're looking to integrate AI into your customer service workflow,

• 1:49:19John Coogan?

  go to fin.ai, the number one AI agent for customer service, number one in performance benchmarks, number one in competitive bake offs, number one ranking on G2, fin.ai.

• 1:49:28Jordi Hays?

  Legends.

• 1:49:29John Coogan?

  You want to talk about Garmin?

• 1:49:30Jordi Hays?

  Let's do it.

• 1:49:32John Coogan?

  Garmin is selling a real time health data for your horse with its easy to attach tail wrap and sensor, the Blaze Equine Wellness System.

• 1:49:43Jordi Hays?

  The Garmin Blaze.

• 1:49:45John Coogan?

  Measures your horse's heart rate, strides, gait, and more during rest and rides. Get insights into their health and fitness and make more informed decisions about their wellbeing and training. I need this as well. And, you know, we talked to the Fitbit for cows company. Well, now your horse will have a Fitbit, or maybe it's an Aidsleep for your horse. But aidsleep.com, get a Pod5 Ultra.

• 1:50:06Jordi Hays?

  This note from Kane is cool. Garmin picks niche but spendy activities and goes, I can crush every electronics maker here. And it sounds like a super fun business.

• 1:50:17John Coogan?

  Yeah.

• 1:50:18Jordi Hays?

  And hunting.

• 1:50:19John Coogan?

  Long range shooting, fishing.

• 1:50:21Jordi Hays?

  Flying.

• 1:50:22John Coogan?

  And so they make very specific hardware, often ruggedized, and figuring it out. But G-Forego says, honestly, one of the most confusing spam emails I have gotten. I do not have a horse. But I love it. I love it. And some of these photos look really, really cool. These Garmin, the bow.

• 1:50:42Jordi Hays?

  I had no idea that Garmin is a $45 billion company.

• 1:50:45John Coogan?

  Huge, huge. I mean, there's a lot of fishing to do. There's a lot of long range shooting or bow hunting. You want to go out bow hunting without a Garmin on your bow.

• 1:50:54Jordi Hays?

  And I think they still crush it in smartwatches despite obviously having

• 1:50:58John Coogan?

  Totally.

• 1:50:59Jordi Hays?

  Competition.

• 1:51:00John Coogan?

  Yeah, because they've differentiated, niched down. Like, Apple's going to be kind of the broad, broad consumer choice for a lot of folks. But Garmin has like, all the trails.

• 1:51:09Jordi Hays?

  They asked the question, what are you running from will help you

• 1:51:13John Coogan?

  Yeah, get there.

• 1:51:14Jordi Hays?

  Go faster.

• 1:51:15John Coogan?

  For sure, for sure. Brian Johnson says, one of the best new habits I've started lately is calling friends for 15 minutes. I say hi, tease them, or share something funny, then it's immediately over. No lingering, no fuss. It's great.

• 1:51:26Jordi Hays?

  It's called flirting.

• 1:51:27John Coogan?

  Now we're friends.

• 1:51:30John Coogan?

  It's called chirping.

• 1:51:31Jordi Hays?

  Chirping.

• 1:51:32John Coogan?

  Hey, uh, did you bench today? What's up?

• 1:51:37Jordi Hays?

  This is. This is just a funny habit. I mean, it's genuinely hilarious.

• 1:51:45John Coogan?

  It's extremely Brian Johnson coded. To take something that's like, just calls like, you know, uh, this is like the classic like tech guy.

• 1:51:51Jordi Hays?

  I'm gonna actually do this to him later. I'm gonna do this to him later.

• 1:51:54John Coogan?

  Yeah, yeah, yeah. Tech guy events being friendly.

• 1:51:57Jordi Hays?

  Texted like once, I'm gonna call him out of the blue.

• 1:51:59John Coogan?

  Yeah. Hey, how you doing? Tease him, tease you.

• 1:52:03Jordi Hays?

  Buddy the elf, what's your favorite color?

• 1:52:04John Coogan?

  I mean, people like it. Seven thousand likes, it's a good take. Um, anyway, starting today, flow by Google, Google AI Ultra subscribers can generate VO3 fast videos without using any credits. So you can fine tune your clips to exactly how you want them and only spend credits on that final upload. May this be the piece de resistance on that new product. And bone GPT says, I just got unlimited VO3 fast, so people are very excited about that. That's fun. I've been really enjoying the VO3 model. Continue to, continue to enjoy it and continue to use it. So, uh, buco capital bloke, sounds like we are getting the final Google ruling tomorrow. For now, we exist in the liminal space between being over and so back via Condeos.

• 1:52:49Jordi Hays?

  This is about the.

• 1:52:50John Coogan?

  Chrome?

• 1:52:50Jordi Hays?

  Chrome divestiture.

• 1:52:52John Coogan?

  Yeah, what's the news?

• 1:52:53Jordi Hays?

  Hasn't come out yet.

• 1:52:55John Coogan?

  Okay, we'll have to track it later.

• 1:52:58John Coogan?

  So, uh, nano banana, more nano banana news from Google. Love these, what does the red arrow see? Google Maps transforms with nano banana. Levels IO says, if you're not building a mini startup with nano banana today and launching it tomorrow, you're missing the opportunity of a lifetime. This image model just made hundreds of new startups and apps possible. The only limit is your creativity and how fast you can ship a user interface and put a Stripe payment button on it, I think. Uh, and Levels has done this a few times. I think he had some, some image generation, uh, app that. Allowed you to decorate your house. So you take pictures of the empty room and then it would give you ideas for decoration and inspiration. I thought that was very cool. And with much

• 1:53:39John Coogan?

  cheaper AI images, it just unlocks new use cases. So certainly.

• 1:53:44Jordi Hays?

  Also, apparently, somebody snipes nanobanana.ai.

• 1:53:48John Coogan?

  Oh, okay.

• 1:53:49Jordi Hays?

  And.

• 1:53:49John Coogan?

  What about dot com? Where's dot com go?

• 1:53:52Jordi Hays?

  And it's not Google affiliated, but they're charging up to sixty.

• 1:53:56John Coogan?

  Five hundred dollars per image.

• 1:53:59Jordi Hays?

  No, they're just saying, yeah, they're charging sixty four dollars for eight hundred high quality images a month.

• 1:54:06John Coogan?

  Wait, isn't it like ten dollars a thousand or something?

• 1:54:09Jordi Hays?

  Yeah, they're marking it up. Again, this is what happened with with ChatGPT.

• 1:54:12John Coogan?

  Yeah, yeah, yeah, same thing.

• 1:54:13Jordi Hays?

  Where people were just reselling ChatGPT before they had a lot of focus on on mobile.

• 1:54:17John Coogan?

  Wow. Well, if you're if you're launching a foundation model and you're using a code name, buy the dot AI, buy the dot com, don't get swooped, don't get swooped. Tyler, have you played with Nano Banana yet at all?

• 1:54:28Speaker 02

  Yeah, it's really good.

• 1:54:29John Coogan?

  Yeah.

• 1:54:29Speaker 02

  I think the main.

• 1:54:30John Coogan?

  Does it unlock anything new? Like, is there going to be a new Studio Ghibli moment?

• 1:54:34Speaker 02

  I don't know. I mean, there's some cool things with just how like consistent the characters are, right? So if like I take a picture of someone, I can like change their shirt and nothing else will change. Like, it's like, you can't do that with, you know, GPT four image.

• 1:54:44John Coogan?

  Yeah, yeah, yeah. Images in ChatGPT, I feel like it always makes the face just like a little bit uncanny valley when it re-renders it.

• 1:54:49Speaker 02

  Yeah, I think that's probably the main use case.

• 1:54:52John Coogan?

  Is that the face just stays the same, basically?

• 1:54:53Speaker 02

  Yeah, for for like photorealistic stuff.

• 1:54:55John Coogan?

  Yeah.

• 1:54:56Speaker 02

  But I think the main takeaway from Nano Banana is that like Gemini now has like, you know, they have like a rune, like they have a poster in the house. Because like you saw, it was like a week before it actually came out, everyone's like, oh, it's on LM Arena, what is Nano Banana? And Logan is just, you know, tweeting the banana emoji. Like, I think that is like the real.

• 1:55:15John Coogan?

  Huge unlock for the vibes. I love it. No, um, the, yeah, the other question is, I wonder, I don't know. Um, yeah, I wonder if this is going to unlock any like specific viral moments, or if it will just be something used by companies because it's cheaper and more reliable. Um, I'm certainly excited. Do you think if, do you think that there's a potential that it's enough to get people to switch to Android?

• 1:55:48Jordi Hays?

  Um, why? Because it would just like natively have.

• 1:55:51John Coogan?

  Have you used the iOS remove object?

• 1:55:56Jordi Hays?

  No, is it really bad?

• 1:55:57John Coogan?

  You should go demo it. You should take a picture of something on the phone. Because you have the latest and greatest, right?

• 1:56:02Jordi Hays?

  Yeah, yeah.

• 1:56:03John Coogan?

  Yeah. If you take a picture on the phone and then you go and you say like, okay, I want to remove this. I'm going to try and remove this Diet Coke from the image. You can go in to edit and then in the, in the image editor, there's a cleanup button. And you can like prepare cleanup in, in iOS and like as you, you kind of draw, it takes a long time. Um, you kind of like, no, I guess it only picks things that you can remove. I don't know. Like it's rough. It does not quite work. Okay, here we go. Now it's finally going.

• 1:56:36Jordi Hays?

  Breaking news, Essence has filed for bankruptcy protection.

• 1:56:40John Coogan?

  What is Essence?

• 1:56:41Jordi Hays?

  Uh, yeah, Gabe literally called this in the chat. He says Jordy might know Essence. Don't think John would know about them.

• 1:56:49Jordi Hays?

  Called it perfectly. Uh, fashion marketplace. Um, surprised, uh, to see this. I'll try to get an article. Canadian luxury, luxury e-tailer told employees on Thursday that the filing was necessary as tariffs took an unexpected toll on the business and to preempt a forced sale by lenders. Essence is filing for bankruptcy protection after what it described as an attempt by lenders to force a sale of the company. Chief executive Rami Atala on Thursday said Essence's creditors want to put it up for sale under the company's creditors arrangement act, a process similar to bankruptcy protection that allows corporations to restructure their finances.

• 1:57:30Jordi Hays?

  Atala went on to say that Essence will fight a sale by filing its own CCAA application within 24 hours. Recently, we have worked closely with financial and legal advisors to develop our own restructuring plan to stabilize the business and rebuild it for the future. The court will decide which path we follow likely, likely within the next week. Um, again, I believe that, uh,

• 1:57:55Jordi Hays?

  from.

• 1:57:58Jordi Hays?

  I believe, Gabe, correct me if I'm wrong, but I believe that Essence just primarily partners with boutiques, so they don't actually hold a ton of inventory.

• 1:58:09John Coogan?

  Okay.

• 1:58:09Jordi Hays?

  I might be thinking of Farfetch.

• 1:58:11John Coogan?

  Hmm.

• 1:58:11Jordi Hays?

  But hard, I mean, sucks when you're a business that is in the business of just selling goods and you can't do that.

• 1:58:23John Coogan?

  Well, good luck to them. Let me tell you about Adio, customer relationship magic. Adio is the AI native CRM that builds scales and grows your company to the next level. You can get started for free.

• 1:58:33Speaker 04

  Founder, no.

• 1:58:34John Coogan?

  And we have our next guest here in the Restream waiting room and now in the TBP and all you don't.

• 1:58:40Jordi Hays?

  What's going on? Welcome to the show.

• 1:58:42Speaker 04

  Hey, guys. How are you?

• 1:58:44John Coogan?

  We're great.

• 1:58:45Jordi Hays?

  Great.

• 1:58:46John Coogan?

  Good to meet you.

• 1:58:47Speaker 04

  Great to be here. Doing great.

• 1:58:49John Coogan?

  Can you introduce yourself a little bit for the stream?

• 1:58:51Speaker 04

  Yeah, you know, my name's Ajay Agarwal, a partner here at Bain Capital Ventures and been here for 20 years, started life in the startup world way back when. Over 96. Been in tech for a long time, so.

• 1:59:08John Coogan?

  Were you ever out of the Boston office or were you always in Silicon Valley?

• 1:59:11Speaker 04

  I was originally in Boston, so when the fund got started, you know, roughly a little over 20 years ago, it was 100% in Boston and that was sort of the year of, you know, Route 128 and, you know, all the great stuff happening in Boston and, you know, the business on the East Coast has really migrated to New York. I moved out to the Bay Area to open our West Coast office. We launched that effort, you know, about 15 years ago. Now, you know, at BCB, the majority of our team is on the West Coast and our second biggest office is New York. So Boston, great town, great life sciences town.

• 1:59:47Jordi Hays?

  Well, and YC was there, it started there.

• 1:59:50Speaker 04

  YC was there originally. I remember the old, old days of YC out of MIT and, and then, you know, YC moved. So it's, you know, Boston's a great place, a lot of innovation here. It's just, you know, the application layer of AI, the foundation layer of AI, it's all happening in SF in New York these days.

• 2:00:09John Coogan?

  Yeah, when, when you say like the firm started 20 years ago, you're talking about BCB specifically and not like Bain Capital broadly, like, how do you tell the story of like the venture firm? Like launching from within that larger structure.

• 2:00:23Speaker 04

  Yeah, it's a great question. You know, the firm was started back in 1984, Mitt Romney and partners, you know, started, you know, and they, you know, early on, that fund was really small. It was like $37 million. And so some of the early deals were what you'd consider tech companies, you know, we invested, we were the first investor in Gartner Group.

• 2:00:47Speaker 04

  Way back when, which is, you know, classic creation of the hype cycle.

• 2:00:50John Coogan?

  Yeah. You literally created the hype cycle.

• 2:00:52Jordi Hays?

  So, so we have a huge poster.

• 2:00:55John Coogan?

  We have a huge blown up poster of the hype cycle.

• 2:00:57Speaker 04

  There you go.

• 2:00:58John Coogan?

  The hype cycle. We love it.

• 2:00:59Jordi Hays?

  We think you can apply it to all, all things in life.

• 2:01:02John Coogan?

  Yes.

• 2:01:02Jordi Hays?

  It is a fundamental truth.

• 2:01:04Speaker 04

  It, it, it is true.

• 2:01:06Jordi Hays?

  You know, if you're having like relationship problems, just, you know, pull up a hype cycle, show your wife.

• 2:01:11John Coogan?

  Yes, we're going to get to the plateau of productivity.

• 2:01:13Jordi Hays?

  We're just in the trough of disillusionment right now.

• 2:01:15Speaker 04

  We are in the trough.

• 2:01:16Jordi Hays?

  But we can see the plateau of productivity.

• 2:01:19John Coogan?

  Yes.

• 2:01:20Speaker 04

  Yeah, yeah, no, I mean, the Gartner was not my friend when, when I was running Go to Market Trilogy, but, um, you know, they, uh, but, but certainly, I mean, that business has continued to do great. And so they made a set of early investments out of what you'd consider a small private equity fund. Gartner Group and DoubleClick and things like that, even Staples, you can consider a venture investment. It was one store.

• 2:01:43Jordi Hays?

  No way.

• 2:01:44Speaker 04

  When Bain Capital invested in this, it was truly a startup. And then, you know, the funds got bigger and they started doing bigger deals. And as a result, that meant more mature companies. And it was clear that, you know, in order to do venture in early stage, it necessitated a separate fund. And, you know, the firm's been very entrepreneurial over the course of 30, 40 years now, you know, 40 years now, you know, we've launched a venture fund. We have a crypto fund. We have a life sciences fund, real estate, you know, kind of a whole range of things. And that's always been the culture, which is let's create it. Each fund, it stands on its own. So we've got to go raise capital, you know, from limited partners.

• 2:02:25Speaker 04

  We make our own investment decisions, but we benefit from the affiliation with the rest of the firm. And, you know, we'll get into industrial renaissance, we'll get into AI and the physical world. But, you know, our access to the real world economy through Bain Capital, you know, actual physical businesses, manufacturing companies and brands and retailers and financial services companies.

• 2:02:47Speaker 04

  That's where a lot of young people want to build today. Um, and you know, that's a huge source of our competitive advantage, you know, the market.

• 2:02:54Jordi Hays?

  Yeah. Before we get into all that good stuff.

• 2:02:57John Coogan?

  How'd you meet Joe?

• 2:02:57Jordi Hays?

  Yeah. How'd you meet Joe?

• 2:02:59John Coogan?

  Yeah. Normally we'd be like, oh, no one knows what we're talking about here, but uh, I mean, he's been on Invest Like the Best. He was in the Journal, like this is Joe Lamont week. And so I got to ask.

• 2:03:10Speaker 04

  I mean, you know, for my entire career, people are like, you know, we've heard of Trilogy.

• 2:03:15John Coogan?

  Yeah.

• 2:03:16Speaker 04

  This week has been peak Joe Lamont. Um, I, I met him my sophomore year at Stanford. Um, a professor of mine said, you gotta meet this guy. He's starting a company and you should join him. And so I, I went over to Tressner and sat outside with, with Joe Lamont. He was a year ahead of me. He was a junior. I was a sophomore.

• 2:03:36Jordi Hays?

  So this was when he was like racking up credit card debt, like financing the business?

• 2:03:41Speaker 04

  Before Trilogy. So he hadn't started Trilogy yet. And he was starting a company. It was called Fourth Connection. Um, and um, you know, Fourth Connection is today what you'd consider a CRF.

• 2:03:53John Coogan?

  Sure.

• 2:03:54Speaker 04

  But you know, we would go around up and down El Camino and go to startups and tech companies and say, wouldn't it be great if you had one database for all your quotes and contacts and proposals? And people are like, wow, that's so cool. That doesn't exist. We'd love to have that. That was what we were selling in Fourth Connection. And so when I first met Joe, the very first meeting.

• 2:04:13Jordi Hays?

  And sorry, was, was that Sales Builder or was that?

• 2:04:16Speaker 04

  No, that was all three Trilogies. The Sales Builder was Trilogy and I, you know, and, and he eventually dropped down and started, started Trilogy.

• 2:04:24Jordi Hays?

  Got it. Wow. So this was like, this was foundation.

• 2:04:28Speaker 04

  Yeah, this is 1988, I think. You know, now I'm dating myself here, but he, um, you know, he said to me, you know what the greatest business on the planet is? And this is like the first five minutes, you know, and um, and I said, I have no idea. And he said, it's enterprise software. And I said to him, what's enterprise software? Yeah, there you go. Enterprise software. Here we are still, you know, thirty, thirty-five years later. It's undefeated, still enterprise software. And I said, why? And he said, it's the only business in the world that you build it once and your marginal profit is basically a hundred percent. He's like, it's the greatest business in the world. He said, life sciences is sort of like that. But he's like, you, you don't know if it works for ten years.

• 2:05:12Speaker 04

  Enterprise software, you know, within a year or two, if this thing works. He's like, let's start an enterprise software company. We did this thing, Fourth Connection. We did that for a year. He dropped out. I decided not to drop out. And then he went on to start Trilogy. I joined him a few years later as employee eighteen. So that, that was the Joe story.

• 2:05:32John Coogan?

  Yeah, uh, I, I feel like, uh, there was a lot in the Invest Like the Best interview. The thing that stuck out to me was towards the end when he was talking about, uh, how AI will affect enterprise software and just like his overall playbook of reducing churn, switching a company from growth mode to retention mode. And, and his, his claim or his hot take was basically that in the age of AI, uh, replatforming or ripping out a piece of legacy enterprise software will get easier. And so the old school trilogy playbook might be a little bit harder to execute. Not just because it's more competitive and everyone has heard about it and everyone's kind of running their version of it.

• 2:06:16John Coogan?

  But just, there might be some fundamental technological shift that's making it easier for companies to, you know, switch to other products. And I'm wondering how you see that trend, if you agree with that, or how you think that affects the next generation of enterprise software companies?

• 2:06:34Speaker 04

  Yeah, I think, I mean, I think the things about this era that are the same as the trilogy are in some ways, it's it's almost a, you know, return, return to the past is this idea of CEO selling, big deal selling, selling a vision. Um, you know, in in the late 90s, we had this enormous pull from CEOs, just like we're seeing today, where CEOs said, I gotta get on this internet thing, I gotta modernize. I just rolled out laptops to all my salespeople and they're on the airplane, just playing solitaire. They need apps, you know, and I need to buy some apps for for my laptops. And so we would sell directly to the CEOs and these contracts would be 10, 20, 30, 100 million dollar contracts. And we're kind of back in that era now. And

• 2:07:17Speaker 04

  the best companies in AI are selling high to the CEOs. Every CEO Fortune 2000, they've got some kind of AI council and they're saying, this is, we're going to fast track all this stuff. We're not going to go through the normal procurement process and everything else. And so I think the companies that are winning today are in many ways able to sell this larger vision to these large companies to say, this is how you don't like get left behind, you know, with the AI revolution. So I think that part has changed from kind of the SaaS PLG era, but in many ways, return to sort of the 90s and Sebel trilogy and I2 and kind of that world. I think the the part that um will be interesting to see, and

• 2:08:01Speaker 04

  there's been this debate and Aaron Levy's talked about this, is will the systems of record get disrupted or will they get stronger? Now, clearly, Aaron's got a, you know, biased point of view because he's he is a system of record, you know, at at Box, but but his view is the system of records are going to get stronger because they represent the ground truth. You know, models hallucinate, you know, AI is probabilistic. What is the ground truth that that's going to guide these agents? And ultimately, is that the data that's inside SAP, you know, and inside Oracle and inside Workday? Yeah. And will those systems get stronger? I tend to Be a big believer in systems of record. I mean, if you just look at the history of software,

• 2:08:45Speaker 04

  the biggest application companies in the history of software have been systems of record. And, you know, that's just been true.

• 2:08:52Jordi Hays?

  Well, even if you look at Satya's, Satya, people were kind of dunking on Satya for posting this thread yesterday, but he was basically just demonstrating how powerful GPT-5 is within Copilot. Because they already have all of your information. They have your email. They have your calendar. They know who people are. It's just very easy to just like run prompts on top of the system of record. And that's just an incredible advantage that Microsoft.

• 2:09:18John Coogan?

  Yeah, I mean, the flip side of this, just to take like the the counterpoint to Aaron at Box is, well, the business owns the data. And so it's very hard for a company that is a system of record to say, no, actually, I'm not going to let you suck all this data out of, you know, my my installation into a data lake or into just a bunch of, you know, CSV files if you want. Like, if I am paying for a system of record, I will demand that you let me print it out and take it out the door if I want, because that's my data. But of course, there are different integrations that can be made a little bit more difficult. So I'm wondering if in the age of AI, there's like the binding between,

• 2:09:59John Coogan?

  even if, even if Salesforce or Box doesn't let me with one click, offboard and onboard into a different service, if I show up with my, you know, my McKinsey or my Bain and Company and I have a team of Accenture, but it's all AI and I say, hey, I want you to pull these files out one by one. Take screenshots if you need to.

• 2:10:19Jordi Hays?

  Yeah, one of my portfolio companies is building agents for enterprise migrations.

• 2:10:25John Coogan?

  So, yeah, I mean, can you wrestle with that? Like, how does that? How does that play into all this?

• 2:10:29Speaker 04

  Look, I I think it's a great point. And certainly, even even the last five years, more and more companies are putting,

• 2:10:36Speaker 04

  you know, trying to get all their data inside, you know, cloud, cloud data warehouse, Snowflake, or Databricks or whatever. And so I think that trend is is continuing. But the question is for enterprises, where is that on the priority list?

• 2:10:46John Coogan?

  Totally.

• 2:10:47Speaker 04

  It's just not on the priority list. It's like, okay, that's there and it works. And I now want to to move forward. And I I want to take advantage of the next set of opportunities. I want to implement, you know, the AI for call centers, AI for coding, AI for, you know, healthcare, RCM billing, whatever it is. And do I really want to go through? You know, even though it might be possible today of taking all my data in Epic and trying to push it somewhere else, it's just low on the priority list. You know, at this point, they've already suffered through the pain of the last 10 years of all these implementations. And so I think it's like a lot of things inside these enterprises are going to build on top rather than try and rip and replace.

• 2:11:28John Coogan?

  Yeah. One of the things that stuck out to me from the Joe interview was, were everyone in Silicon Valley is familiar with the concept like built to grow? Like you're in growth mode, go, go, go. Then there's obviously a lineage of companies that are built to last. And he brings up kind of a controversial one, which is some companies are built to die and that they've, they've kind of done all that they will do. They've built all the products that they will do and they are, and they are machines to kind of maintain their customers for as long as they can. But the, the, that particular product will not exist and the people that work there will migrate to other projects in the portfolio. And I'm wondering if you have a unique perspective from your background, a trilogy, and then also the overlap between B C Vs in a unique position.

• 2:12:09John Coogan?

  I don't know how to, how tight the firm is broadly, but like Brookside could take a company public. It's like the coolest thing possible. And then you also have the private equity, like lineage there that could turn around a company or take it in a different direction. And I'm wondering if that brings you a different perspective when you're sitting on a board to have a real conversation with a, with a, with a founder. That's not just, hey, swing for the fences and then you just, if it, if it's not a home run, you're never going to hear from me as opposed to actually I can still help you make good decisions in the era where you're going public or where you're going and working with private equity or where you're winding the company down. Like, do you feel like you have a differentiated perspective there from other venture capitalists?

• 2:12:49Speaker 04

  Yeah. I mean, I think the reality is that there are so many different ways to create value. And it's funny, you know, kind of in this era where venture firms are. You know, kind of, you know, there's a stampede towards becoming private equity firms, you know, and, and, um, you know, and so.

• 2:13:07John Coogan?

  I did that first.

• 2:13:08Speaker 04

  Yeah.

• 2:13:09John Coogan?

  Nobody, nobody.

• 2:13:10Speaker 04

  We, we, you know, we, we, we sort of understand that, that desire, uh, at Bank Capital. And so there are just a lot of different ways to, to, to generate value, to create value. And one of the benefits of being at Bank Capital is you see all these different divisions.

• 2:13:26John Coogan?

  Yeah.

• 2:13:26Speaker 04

  And private equity and public equity and credit. And it's incredibly smart people that are partnering with companies to create value. And these companies are different stages, different dynamics, different competitive situations. And, you know, uh, there, I mean, a lot of great companies end up getting bootstrapped to the point where then they might, you know, sell estate to, to private equity. That was the case when we invested in Survey Monkey, you know, as a bootstrap company. And then, um, you know, we got involved, uh, as part of that business. And so I think that is just the reality, you know, a good friend of mine, founder, we backed early, you know, Nick at Gainsight, um, we were part of that journey. And, you know, he decided that the growth profile of the business was still going to be very strong,

• 2:14:09Speaker 04

  but was not going to be the 60 to 100% growth that, you know, folks like us, venture investors wanted. And so he, you know, orchestrated, you know, incredible exit to Vista, um, where, you know, he was able to transition all the venture investors to a different type of investor that was in many ways ideally suited for that more mature phase of Gainsight's growth, you know, over the last, you know, four or five years. So I think that's an important thing. There's different ways to, um, you know, create lasting value. And I think founders oftentimes, you know, in social media are looking for a pattern or one way. There's just not one way, you know, it's, um, there, there are a lot of options out there.

• 2:14:52John Coogan?

  Yeah, on, on a similar note, I know, uh, I think it's rebranded Sanctity Advisors. The credit arm of Bain is now.

• 2:15:00Speaker 04

  Bain Capital Credit. Yeah, it used to be Sanctity, now Bain Capital Credit.

• 2:15:03John Coogan?

  Got it, yeah. Uh, and I'm wondering if, uh, if just having any interaction with those folks has, uh, given you a differentiated perspective on what's going on in the venture debt markets? We were reading the other day in the journal that, uh, there's been, we're back to new highs. Where it was a drawdown. Volumes expanded, but the amount of deals has, has contracted.

• 2:15:24Jordi Hays?

  But also the number of individual lenders has increased.

• 2:15:27John Coogan?

  Yes, yes.

• 2:15:27Jordi Hays?

  The market just basically fragmented.

• 2:15:30John Coogan?

  Yeah, so I'd love to know your, your, your, your thinking and what you're advising founders on. When is the right time? What is the shape of the business? Like, what is the current meta for getting the most out of a venture debt partnership? Uh, from, you know, years ago, it was very different. How are you thinking about it now?

• 2:15:50Speaker 04

  Yeah, I mean, I think debt is very powerful, but it's also very dangerous. Um, and the reality is that, you know, for an early-stage company that's pre-product market fit, I think the best case use of venture debt is some runway extension.

• 2:16:06John Coogan?

  Yeah.

• 2:16:07Speaker 04

  Um, and, and not even really runway extension such that you can sort of draw your equity down to zero.

• 2:16:12John Coogan?

  Um, and so it buys you a few months.

• 2:16:16Speaker 04

  Um, but we, even when you, our companies have venture debt and they're pre-product market fit. We, we advise them not to actually tap into the debt. It's there, you know, so they can sort of extend the runway a, a few months. I think that's one option for venture debt. I think the second is if it gives you a clear path to profitability. If you're, you know, a later-stage company and the venture debt can avoid a dilutive equity round and you can get to profitability, then I think it's very effective. I think for businesses which, you know, are rare in our, our, our world, but that have capital, uh, you know, that are a little more capital-intensive, certainly credit can be a source of, of financing, working capital financing, you know, uh, is effective.

• 2:16:58Speaker 04

  But your business has to be very predictable. And generally, credit is best used when you're break even or, or close to profitability. I mean, I think, I remember, you know, we had this great company, Reich, um, that was, you know, a PLG company, kind of in the space of Asana and Monday and all those companies. Ultimately, you know, I think it exited for north of $2 billion. But I remember Vista was looking at the company and they just said, look, you know, uh, given, uh, you know, given this level of ARR, we can, we can take that amount of ARR and put 2X that number of debt on the business, you know, because the business is so profitable, because it's generating cash, and that can allow that money to come out.

• 2:17:43Speaker 04

  You know, the shareholders. So there are a lot of interesting ways you can leverage debt. I just think you have to be very careful if you are not quite a predictable company that has a path to profitability, then I think you've just got to be very selective.

• 2:17:57John Coogan?

  Yeah, it feels like something where you get in a lot of trouble if it's, if it's a, if it's not a foregone conclusion that you can raise another equity round.

• 2:18:05Speaker 04

  Exactly.

• 2:18:05John Coogan?

  But if you're a place where you could always do an equity round, there's always demand at some price. But if you're ever going to be in a situation where there might not be enough demand to clear your next 12 months, 18 months of burn.

• 2:18:18Speaker 04

  That's right.

• 2:18:18John Coogan?

  At any price, you are in trouble potentially.

• 2:18:21Speaker 04

  Exactly.

• 2:18:21Jordi Hays?

  Give us.

• 2:18:22John Coogan?

  Yeah. Oh, I was just gonna say, we had Pete from Astronomer on the show. How, where does that rank in terms of like crazy wild cards in your career? I, I feel like it was, it just gripped the whole tech community. And I'd love to know a little bit of the play by play of like how you experienced that internally. Because it feels like the most unexpected like story to ever emerge out of a company that is managing Apache airflow.

• 2:18:53Jordi Hays?

  Well handled and well handled.

• 2:18:55John Coogan?

  Extremely well handled, yes. But we all know about Apache airflow now.

• 2:18:59Speaker 04

  No one, no one had in their 2025 bingo card Coldplay or Apache airflow.

• 2:19:03John Coogan?

  Exactly.

• 2:19:03Speaker 04

  Both are, and Gwyneth Paltrow. But, you know, I, I got a call from, you know, my partner Enrique who's on the board.

• 2:19:11John Coogan?

  Yeah.

• 2:19:11Speaker 04

  You know, Thursday morning and you told me what happened and I hadn't, you know, been on social media.

• 2:19:17Jordi Hays?

  Wasn't Thursday, Thursday, the concert was like Wednesday night, right?

• 2:19:21Speaker 04

  Concert was Wednesday night. Yeah, exactly.

• 2:19:23Jordi Hays?

  You get this call, hey, how's it going?

• 2:19:25Speaker 04

  I get this call and I'm like, oh my God, that's crazy. And so then I went to social media and watched the video. And then later that afternoon.

• 2:19:34Speaker 04

  You know, I rented my wife and I was like, oh, this thing happened to her company and I was explaining. And I I assumed it was sort of this thing like in the

• 2:19:40Jordi Hays?

  Isolated.

• 2:19:41Speaker 04

  Narrowed tech world, you know, that I that I live in, you know, and she was like, oh, my God, everyone's talking about that video. It's gone totally viral. My kids were pinging me and I've, you know, the the part of it going, you know, viral in tech, that's happened and good news, bad news at at various of our companies over time. But the part where it became part of the cultural zeitgeist for the entire country for literally three days. Um, never experienced anything like that. Um, and, um, you know, I think the board um, and and the management team, Pete, obviously is a founder.

• 2:20:18Jordi Hays?

  Yeah.

• 2:20:18Speaker 04

  Um, they, you know, they did a really good job of, you know, one being, you know, number one, you know, we we we responsibility to the employees and our customers and and let's do what's right. Um, number two, um, you know, th- this is obviously a cultural moment, but there are also real people involved and their families and things like that. So I think they handled in a way that I think reflected a bit of that balancing act. Um, and, um, and so, you know, I think, uh, you had Pete on the show. He was great and, um, you know, and I think, uh, the company, uh, came out the other side, uh, with more visibility.

• 2:21:00Speaker 04

  Certainly, I think our our customer base feels very good about the business. The business, you know, um, you was growing very rapidly, um, and and has continued to do so. So, you know, we feel really good about the business. We feel good about the investment and, um, you know, uh, thank God for Gwen. So.

• 2:21:20Jordi Hays?

  Yeah.

• 2:21:21John Coogan?

  Yeah, as always.

• 2:21:22Jordi Hays?

  Absolute masterclass. Uh, give us, uh, an overview of how you're thinking about, uh, what some would call American dynamism, but just this industrial renaissance, how you're thinking about. What's important but maybe not investable versus what's important and investable from a venture standpoint?

• 2:21:40Speaker 04

  Totally. Well, we don't like to call it American dynamism, but we call it industrial renaissance. But, you know, we think that, you know, it's a really important trend and opportunity. And certainly, you know, I think that there are enormous tailwinds, you know, that are, you know, heading in this direction. Certainly, the advances in technology and computer vision and the sheer cost of robotics and automation has come down. The geopolitics, onshoring, tariffs, labor shortages, all of that, I think, is creating the tailwind. Certainly, you've got similar set of dynamics if you extend into, you know, the military and Department of Defense.

• 2:22:26Speaker 04

  You know, our strategy here, you know, really starting with our investment in Kiva Systems way back when. I think it's been to invest in companies where the core innovation is still software. You know, and there are elements that involve hardware and robots and things in the physical world. But the core innovation is ultimately software. And I think Kiva is a good illustration of this, you know, when Mick showed me the prototype way back when, 2004. He said, you know, inside an Amazon warehouse, a worker is spending 90% of their time walking to the shelf and 10% picking. And so he said, and he said, having a robot pick one of a million SKUs that are different shapes and sizes

• 2:23:11Speaker 04

  and weights and colors and T-shirts versus like a broom, he's like, that's an impossible problem. It won't be solved for at least a decade. You know, it's now been, you know, now 20 years, it's still not a solved problem. But he said, the problem of getting a robot to move a shelf from point A to point B, he said, that's a trivial problem. You know, and so his insight was instead of having the worker go to the shelf, I'm gonna have the shelf come to the worker, you know? And that alone, triple productivity, built this great company powering all of Amazon today. It's, you know, it's really core to their fabric of how they run their warehouses. And so we're looking for opportunities like that, that are fundamentally software at their heart. It's more of a systems approach, you know, really thinking about a problem holistically.

• 2:23:56Speaker 04

  These companies tend to be more full stack as opposed to just selling a widget. Of some kind. I think that also prevents you from being commoditized by low-cost, you know, offshore manufacturers trying to come in. So those are some of our thoughts kind of in this industrial renaissance world.

• 2:24:12Jordi Hays?

  So you've backed every humanoid robot company?

• 2:24:17Jordi Hays?

  No. Sounds like, sounds like.

• 2:24:20John Coogan?

  I mean, we're, yeah, we were talking about this. Like, you see the exquisite demo and I, it must be a jump to try and understand, okay, can this person, are they just a genius? They can build one? Or are they building a system that delivers to the tune of a million? Uh, we were talking about this with SpaceX, obviously tons of rockets blowing up. I think they're on ship 36, but like, the goal is not just get one rocket to space. Like, we did that. We went to the moon. Um, the goal is like, get it really cheap and reliable. So it's going every 30 minutes. Uh, same thing with, uh, what we're seeing with Zipline. Those, th- those folks are, are just focused on like scaling and manufacturing. The Starlink stuff's the same. Uh, it's a completely different dynamic and problem that you're actually

• 2:25:05John Coogan?

  solving. Um, Jordy, where do you want to go next?

• 2:25:10Jordi Hays?

  Good question. Um, yeah, I guess, well, also, so, yeah, I, I think, uh, Aaron Slodov had a post yesterday having some, some, uh, he has a, a manufacturing tech company and this idea of like, basically, yeah, understanding specifically these industrial renaissance companies. I have to imagine you're oftentimes meeting entrepreneurs where you're like, this seems like a good business. It should exist. But, um, like, what, what is your, like, actual investment criteria for a company that wants to make things in America? That's not, not a company that is a system for making things, but, but something where it's an actual, uh, physical product as the, as the output.

• 2:25:56Speaker 04

  Yeah, I think if you're actually a core manufacturer as opposed to a technology company that's automating manufacturers, I think the bar is very high to invest as you know, from a venture standpoint, because I think there are a couple of things you got to believe. I think number one, you got to believe there's truly proprietary technology and that's just a high bar in manufacturing. I mean, you know, you've seen it with, you guys were referencing the Roomba earlier and you know Shark Ninja, you know, like anytime, you know, every Dyson product, every, you know, product that's out there, they have some equivalent. And Shark Ninja is a great company. I'm not disparaging them at all, but you

• 2:26:41Speaker 04

  know, you realize you're going to get competition very quickly as a manufacturer. And so the question is, what is that source of, you know, competitive differentiation? And oftentimes it's software, some kind of software or network effect or data, you know, that allows this business to maintain proprietary margins and a huge competitive advantage over time. And so I think you need that, or you need just an extraordinary, you know, entrepreneur, a founder, you know, an Elon-esque, you know, founder. I just think it takes a very special kind of founder to build a physical products company. You're just dealing with,

• 2:27:21Speaker 04

  the physical world is far less forgiving on so many dimensions. One, just making money, but two, having it work.

• 2:27:28John Coogan?

  On that note of software, is it always some, is it always software that enables like the bootstrapping of a network? I'm thinking of like, Apple gets power from software, but not just software. It's like iMessage integration, a network. Nvidia gets power from software, but it's CUDA. What is CUDA? It's a network of talent and standards. It's not just you copy CUDA and you're good or you're feature parody. Tesla, they have self-driving. It's great as a single thing, but it really is like a scaled network that gets better the more people use it. Is there some sort of dynamic there that creates a flywheel effect?

• 2:28:03Speaker 04

  Absolutely. Yeah, I think that flywheel is really important. You know, we're investors in this logistics company called ShipBob.

• 2:28:09John Coogan?

  Oh, yeah.

• 2:28:09Speaker 04

  And, you know, ShipBob is like a, you know, it's a tech company up and down, but when you think about why is ShipBob so powerful? It is ultimately a network effect because we have so much density, we have so many warehouses. You know, we know, and we have so much data, we know that, you know, customer A in New York City is going to order this product from this vendor. So we're going to make sure that product is sitting in a warehouse on the East Coast. And by the way, we're not going to get that right 100% of the time. So 30% we get it wrong. We're going to be able to fill up an entire truck of stuff from LA and get it to New York. So then we can inject that package, you know, at the last mile and bring down the package, you know, the, the delivery cost by $2 or $3.

• 2:28:53Speaker 04

  And so it's a classic network effect business that's underpinned by data and software, but certainly relies on, in, in that example relies on physical warehouses. You know, we have a certain number of physical warehouses. We don't own those, you know, those are through partner sites, but those are physical assets that are out there that create the density. We're using physical trucks to move things from point A to point B. But ultimately, our ability to do that is driven by data and software, you know, at the ground level. And, and, and those founders made a really interesting decision, which was we are going to partner with third-party warehouses, but they have to use our entire stack of software. We're not going to rely on their side. If they don't use our warehouse management,

• 2:29:35Speaker 04

  our pick and pack software, they don't adhere to all of that. We're not going to work with them because we need to have that, you know, pane of glass that sees every bit of information from, from soup to nuts. So I think your point, John's a good one, which is, you know, the, these businesses that ultimately create some kind of network effect. Ultimately, you have that flywheel that, that keeps going and allows you even, you mentioned DoorDash, I think on a previous, you know, podcast a few days ago. These businesses that people think of as low margin, and once you get that network effect and that flywheel, it, you can just compound forever.

• 2:30:14John Coogan?

  Well, thank you so much for joining. There's a ShipBob fan in the chat spamming. ShipBob will be a $10 billion company. Let's hear it for ShipBob.

• 2:30:22Speaker 05

  Good to see you guys. Thanks.

• 2:30:23John Coogan?

  Have a great rest of your day.

• 2:30:24Speaker 05

  All right, you too.

• 2:30:25John Coogan?

  See ya.

• 2:30:25Speaker 05

  See you guys.

• 2:30:26John Coogan?

  Let me tell you about public.com, investing for those that take it seriously. They got multi-asset investing, industry-leading yields, and they're trusted by millions. And our public.com update is that ByteDance just made more money than Meta for the first time in history. Yeah, I think this is a boo because we root for Zuck. We root for America.

• 2:30:44Jordi Hays?

  We are Team Zuck, but you gotta give it up.

• 2:30:46John Coogan?

  But you gotta give it up for big numbers. Congrats to the team over at ByteDance, putting up some heroic numbers. $48 billion in Q2 to Meta's 47.5, just, just, just over 47 billion. Oh, it's gotta be rough over there.

• 2:31:01Jordi Hays?

  Well, up next, we have the founders of Framer.

• 2:31:04John Coogan?

  Welcome to the stream. How are you guys?

• 2:31:06Jordi Hays?

  Gentlemen, what's going on?

• 2:31:07Speaker 06

  Hey. Good to be here.

• 2:31:10Jordi Hays?

  Big day.

• 2:31:11Speaker 06

  Thanks, Venus.

• 2:31:11Jordi Hays?

  Big day. You guys are up late, right?

• 2:31:14John Coogan?

  Yeah, thanks for hopping on late. I'm so trained to, when we have two people, they gotta debate. I think we gotta get these guys to debate. What are we debating?

• 2:31:21Speaker 05

  I mean, we do that all day, so.

• 2:31:22Jordi Hays?

  Yeah, yeah, yeah. That's the life of a founder.

• 2:31:25John Coogan?

  All right, give us, give us an intro, the update, and...

• 2:31:29Jordi Hays?

  I got the gong ready for you guys.

• 2:31:30John Coogan?

  What is, what is top of mind for you guys?

• 2:31:32Speaker 06

  What do we do with the gong?

• 2:31:34Jordi Hays?

  Uh, just wait.

• 2:31:35John Coogan?

  Just, you'll find out.

• 2:31:36Speaker 06

  All right.

• 2:31:37Speaker 05

  Yeah.

• 2:31:37Speaker 06

  All right, here we go.

• 2:31:39Speaker 05

  All right, so the update is, uh, so we're Framer. We're a web design platform for, uh, for professional, or like professional web design platform where companies can run their entire dot com. And we, uh, raised Series D that we announced today.

• 2:31:53John Coogan?

  Let's go.

• 2:31:55Speaker 05

  Ah, that's what it's for.

• 2:31:56Jordi Hays?

  That's what the gong is for.

• 2:31:58Speaker 05

  We should get one of those.

• 2:31:59Jordi Hays?

  100 on 2 billion.

• 2:32:00John Coogan?

  Wow, that is a big...

• 2:32:02Jordi Hays?

  Big number.

• 2:32:02John Coogan?

  Congratulations.

• 2:32:03Jordi Hays?

  Big number.

• 2:32:04Speaker 06

  Were you guys in sales? Is that what the gong is for?

• 2:32:07Jordi Hays?

  Uh, we just celebrate, we just enjoy...

• 2:32:10John Coogan?

  Huge capitalism fans, honestly.

• 2:32:12Jordi Hays?

  Yeah, it's really just a love for business and big numbers. But, uh, but yeah, it's a staple, and it's a, it's our pleasure to hit it whenever, whenever we can. But give us, give us, first time on the show, give us a quick background on, on the, on the company.

• 2:32:28John Coogan?

  Yeah, yeah.

• 2:32:29Jordi Hays?

  Where you guys wanna start?

• 2:32:31Speaker 05

  Yeah, so I'll go pretty quick. Like, we're both product designers. And we sold our first company to Facebook, where we were product designer for a couple of years. And after Facebook, we figured, hey, let's do another company before we get old. That's more than 10 years ago. And we always loved building creative tools. So we figured, okay, you know, like, startups are pretty hard. Why don't we pick something that we really like working on? So let's build the next Adobe. And everybody around us said, like, don't do that. You'll probably raise some money, but not for design tools. Just don't tell any investor you'll be building that. But we did. And then 10 years later, and a big pivot, here we are. Overnight success.

• 2:33:13Jordi Hays?

  Overnight success.

• 2:33:14Speaker 05

  Overnight success. Basically, what Framer's really good at, or, yeah, like, you know, I could talk about the product market fit. What we're really good at is, we allow folks to basically, designers ship websites themselves for companies. So you have your, let's say, your Figma, where you do your design and you turn it into an application. You've got tools like Squarespace and Wix, where you make your personal sites. But a lot of company websites are still built with code. It's kind of slow, you need a developer team. And over the last couple of years, we saw more and more companies just wanting to ship sites much faster and do it in a visual tool. So that's what we built.

• 2:33:51John Coogan?

  What's your take on the vibe coding boom? Where, what are the, within, I mean, we're all familiar with the growth of vibe coding stuff. What are the overrated use cases? What are the underrated use cases within the vibe coding boom?

• 2:34:07Speaker 05

  Yeah, I think we're about to find out. I think, I think everybody's just really excited with where it's gonna go. Because in the beginning of this year, I'm sure that if you type in, you know, like, make me a nice front page for the company that you're at, then, you know, you're not really gonna use that result yet. But you can see it's gonna get there, right? Like, we're close enough for the LLMs to, like, it's not gonna win any awards. You can't really use it for your site yet, maybe for your personal site. So I think over the next year or two, somebody's gonna make that work for companies. Somebody's gonna make that work on brand. Somebody's basically gonna allow designers to sort of like teach the LLMs how to generate, just like an engineer kind of handholds an LLM to write the code.

• 2:34:52Speaker 05

  And I think we're kind of on the, on the, on the cusp of figuring that out. And that's obviously what we're spending a lot of time on.

• 2:34:58Jordi Hays?

  How important is the is the kind of network around Framer? I know there's people that make businesses designing sites that can be adapted and things like that. Is that a core part of the business in the way that maybe sort of like the Shopify app ecosystem might be? Or is it more in the direction that the platform is heading? Is it more about allowing people to generate, you know, sites entirely based on their own brand assets and things like that?

• 2:35:31Speaker 06

  100%. So we call it creators and it's a whole economy by itself at this point. People building more than just sites for clients, which is typically what you would think of is you build a website for clients. Next to that, they build templates, they build plugins, they build all kinds of assets that can be sold on the Framer marketplace. And we're starting to see people make serious money off of that. The most impressive examples are folks that basically started with a new Twitter account with zero followers and then set out a challenge to get to 10K in, let's say, 30 days just by making sites and selling assets on our marketplace.

• 2:36:16John Coogan?

  Are they successful? It sounds like they've they've already done this. Is that what you're saying?

• 2:36:22Speaker 06

  Yeah. This is happening every day. This is the whole thing now. Design Twitter. And I think, yeah, there's a couple of outlier examples of people are now doing like 300 or 400K a year just building businesses on Framer by selling these assets.

• 2:36:36John Coogan?

  Yeah. Are there are there features or functionalities that you think you want to add based on the generative AI boom? I'm thinking like we've seen these like not just, okay, build a landing page for a business, but build a game or use 3JS or WebGL. And there's like, there's more tools that feel previously it was like, okay, that's if you're going to build a video game in the browser, like that's going to take you a long time. And now people are vibe coding them. Are there other features or, you know, web components that you want to like surface more easily to, you know, prosumers?

• 2:37:15Speaker 05

  Yeah, if you have like a big web platform, you can go a few ways. Like one is obviously the marketing, sort of what we're trying to figure out. Just help startups ship the most beautiful websites really quickly that go very fast. And then you can always go into e-commerce, but all I see is Shopify. I see a lot of people try, but all I see is Shopify. So you've got to be pretty confident to go after that. And then the third thing is that there's something between an app and a site that people can't really make today, right? So there's websites, we're really good at marketing websites now, but there's obviously websites that do more, right? Like, so they're more like a database, a catalog, they could have a feed, a login state. And that's, that was always constrained by people that could express that, could express that logic, and for that you had to code.

• 2:37:59Speaker 05

  And I think, you know, like we're in an interesting time where the L L M's can maybe help with that. So it's definitely something that we're also going after.

• 2:38:07Jordi Hays?

  Yeah, how, how, uh, it feels like your guys' strategy is, uh, uh, the, the entire, you know, market for creative tools today is extremely loud, right? Every, every day there's new tools launching. You guys seem to be extremely focused still on, on this core value prop of helping people make beautiful, simple, professional sites. Is, uh, how much, how much, uh, what do you, how, how do you think, uh, not, not to get too far out into the future, but how do you expect, uh, like, do you think the dot, like, my view is that the dot com is, is like a hyper durable asset that will continue to have a lot of value for, for, you know, for, for the, for the, uh,

• 2:38:52Jordi Hays?

  you know, the next decade, two decades, et cetera. And there was a time when people thought that URLs and, and everything would just become applications and things like that, and I don't think that's panned out. How, what's your guys' vision for, uh, basically the future of the website itself, right? At a, at a time when, you know, already we're seeing in different tools, um, you know, different, you know, consumer L L M's that will generate UI and scrape websites and things like that. Uh, how, what's your kind of, um, what does the website look like in 10 years?

• 2:39:27Speaker 05

  And not like a chatbot, but you'd be surprised. We've been pitching, obviously, for this round. You'd be surprised how many VCs think that that might be the case.

• 2:39:34Jordi Hays?

  Yeah.

• 2:39:35Speaker 05

  Um, but the web as a like as a form to present your brand and build brand equity just isn't really going any there anywhere. But one of the things that we really like, I mean, we're both product designers, so obviously we have business goals. But if you ask me why I get up in the morning, it's also to make the web cooler. And the browsers can do a lot of really cool stuff, right? The L L M's unlock people to build stuff for that. And the websites kind of look boring, like they've only gotten to look more boring over the last 10 years. So I think tools like Framer can really help the designers sort of express more interesting websites. So I think that, you know, with that kind of more people being able to execute on that, but as well as sort of like,

• 2:40:15Speaker 05

  you know, showing more, like doing more cool stuff that the browser can do, like combining 3D and video on websites, making much richer, cooler experience. I think that's really where things are going. So I think it's only, the browser is still such an underrated sort of piece of technology in terms of how it's used for presentation. And if we give folks the tools to build like cooler outputs for that, then they will.

• 2:40:37Jordi Hays?

  Yeah, I think it, I think it says a lot that all, you know, every major AI company wants to have a browser themselves or they want to buy Chrome, right? That, that to me says, you know, all you need to know, at least for now, around where, uh, where the category is going.

• 2:40:53Speaker 06

  And it's pretty interesting that, that all the AI brands are very heavy on their personality on the internet, right? So they all have pretty websites and beautiful brands, um, really nice dot coms.

• 2:41:07Jordi Hays?

  Yep. Dot coms forever. We're, we're big dot com enthusiasts here.

• 2:41:10John Coogan?

  Huge enthusiasts. Thanks so much for hopping on, guys.

• 2:41:13Jordi Hays?

  Yeah, congratulations, you guys and the whole team.

• 2:41:15Speaker 05

  Thanks for having us.

• 2:41:16Speaker 06

  Thanks so much.

• 2:41:17Jordi Hays?

  Cheers.

• 2:41:17Speaker 06

  All right. Cheers.

• 2:41:18John Coogan?

  Bye.

• 2:41:18Speaker 06

  See you.

• 2:41:19John Coogan?

  Up next, we have a great dot com, super.com. But before I tell you about that dot com, let me tell you about adquick.com, out of home advertising made easy and measurable. Say goodbye to headaches of out of home advertising. Only Adquick combines technology, out of home expertise and data to enable efficient, seamless ad buying across the globe. And we will bring in super.com with some news.

• 2:41:40Jordi Hays?

  One of the best dot com.

• 2:41:41John Coogan?

  How you doing?

• 2:41:42Jordi Hays?

  What's happening?

• 2:41:43John Coogan?

  What's latest?

• 2:41:44Speaker 07

  Good, doing well. Thanks for having me.

• 2:41:47John Coogan?

  Thanks for hopping on. Give us the news.

• 2:41:50Speaker 07

  Well, first I saw your comment. Thank you for the domain shout out.

• 2:41:53John Coogan?

  Of course.

• 2:41:54Jordi Hays?

  It's fantastic. Give us, before we dive into the news, how did you get, any crazy stories getting the domain?

• 2:42:00Speaker 07

  Yeah, definitely crazy stories. So we, we, we had a different company name. We were called Snap Travel. We wanted to rebrand. We did this whole activity and this whole exercise. And we liked the name Super because it's how it made our customers feel. Like when they saved money, when they found a great deal, they felt super and we loved it. It was such a generic word. If you Google Super, you're just like getting Super Mario Brothers, you're getting whatever you're getting. So we're like, hey, we gotta go and get the .com. We reached out multiple times, didn't get any answers. I'm like, okay, forget this. Meta at one point launched some product called Super and we're like, oh, they probably like are gonna try and buy it. And it was just like, we're not getting this domain. And then we got a domain broker.

• 2:42:39Speaker 07

  And out of nowhere, they were like, okay, this person's like interested, but it was a pretty intense negotiation process. It was kind of in the, in the single digit millions. And then it got to the board level and it was split and it was 50 50. Half the people were like, I don't think this is worth it. People don't really care about domains anymore. They just like search on Google.

• 2:42:56Jordi Hays?

  So not true. It's so not true. Like people are, people are, people, I mean, domains are still, I think wildly underpriced, like .com specifically. And it's because people have just been so trained. If you've been on the internet for any amount of time, you know that when you are on the website of a big business, it's a short .com. And when you're on the site of a less legit, less established business, and consumers are really smart. They just pick up on these things. And yeah, it's interesting. So you guys, I imagine you guys have trademarked super.com because you can't trademark like super or who knows.

• 2:43:36Speaker 07

  That's right. That's right. So we trademarked super.com. And anyways, the story was it was 3-3 in the board. And ultimately as a CEO, I get to make the hard, hard decisions. We're like, we're gonna do this. So we bought the domain. You're right. I think, I think for consumers, it does matter. Right?

• 2:43:50Jordi Hays?

  Totally.

• 2:43:51Speaker 07

  Yeah, so the the big news, uh, we just wanted to introduce our incredible momentum. So we crossed over two hundred million uh in annualized. Congratulations.

• 2:44:00Jordi Hays?

  Crazy.

• 2:44:01Speaker 07

  Yeah, and and and if you think of the evolution, so we've been around for about nine years now. We started the company and it was just like.

• 2:44:10Speaker 07

  Hotel, it was a travel hotel deal, right? So we were doing hotels for like four or five years and then we like completely rebranded to super.com, expanded the product, introduced this membership program. And that's just allowed the business to completely take off. So we're now, you know, hundreds of thousands of paying members as part of this membership club to like save more, earn more, build credit, uh, and just experience more of what life has to offer. So.

• 2:44:35Jordi Hays?

  How is it? How is it trying to get uh coverage from the legacy media for just doing a lot of revenue? I feel like they they still are like, ah, like, I don't know if it's a story, like, come back to us when you raise like a million dollars, but you're like, ma'am, or sir, I've, we're doing hundreds of millions of revenue. I think this is more notable.

• 2:44:53Speaker 07

  No, it it it's it's so it's so interesting. The traditional media, they don't, they don't have the time to like think about that. And there's like, if it's a fundraiser, I'm gonna, I'm I'm interested. If it's not a fundraiser, I'm not interested, right? So, um, but there's a lot of companies that are doing really well and driving a lot of revenue and I'm happy you guys are are talking to us.

• 2:45:10John Coogan?

  Yeah. What are the other uh business models in the category that you deliberately avoided from like lessons from like the previous cycle? Uh, previous strategies that maybe like uh might have product market fit loosely, but not real sustainable business models?

• 2:45:28Speaker 07

  Yeah, that that's a really good question. So let let me take a little bit of a step back. Okay, so the company super.com, we have a membership program called super plus. Super plus is fifteen bucks a month. And the idea is when you're a super plus member, you just get fifteen to twenty benefits. So you can save on hotels, you can save on gas, you can save insurance, you can save on pharma, you can earn money playing games, filling out surveys. We have a mastercard that helps you build your credit score and one percent cash back. And some people come in, they use like one or two products. Some people use like five or seven products. But ultimately, it's like, you think this is worth fifteen bucks a month, or you are getting more than fifty dollars a month worth of value, right? And for some people, that's just, I just book hotels like once a month and I'm saving, you know, thousands of dollars.

• 2:46:09Speaker 07

  For other people, it's I'm using the cash advance product, I'm earning money, I'm building my credit score. So everyone kind of uses the app somewhat differently and and we use AI to. Kind of customize the app. So you'll see what we think is most relevant to you. It will give you the most value from your membership. Now. You asked a question, which is like, what hasn't worked out, right? So we are like, okay, what can we add to the membership? What can we try? We tried something about two years ago, uh, where we thought we could get into selling discounted like physical goods, like actual

• 2:46:39Jordi Hays?

  Hmm.

• 2:46:40Speaker 07

  Products, right?

• 2:46:41Jordi Hays?

  Yeah.

• 2:46:41Speaker 07

  Uh, we found and what we learned, yes, it's very, very tough. It's almost impossible to compete with Amazon.

• 2:46:47Jordi Hays?

  Yeah.

• 2:46:47Speaker 07

  But the hardest part was that you can't consistently get a large supply of discounted

• 2:46:54Jordi Hays?

  Yeah.

• 2:46:54Speaker 07

  Physical products. It's either it's like it comes and it goes and then it's like, oh, this is a hot item now and then it's not, or it's like you get outdated stuff and then it sits in a warehouse and you couldn't keep that steady supply of discounted goods and it became a very unreliable customer experience. So we actually acquired a company. Tried to build up the goods business, had a physical warehouse in Miami and then we ended up just shutting that whole division down and and shutting down that warehouse. So not overnight success.

• 2:47:20Jordi Hays?

  Uh. What's working on the customer acquisition side? What, what, where are you guys, you know, spending money on acquisition most aggressively and and uh, then I have another kind of related question.

• 2:47:33Speaker 07

  Sure. Uh, so each product has its own acquisition channels that work well. Right? So we don't necessarily advertise the entire membership. It's a, hey, come join and get like fifteen plus benefits. The way we acquire customers is we go for like one product. And then they come in and they're like, oh, I'm going to become a member because this product is so worth it. And then hopefully they stick around and do more things, right? So for hotels, it's a very high intent product. So what that means is it doesn't matter how much advertising you do on Instagram or Facebook. It doesn't really work. Right? What works is when you're on like Google or kayak or TripAdvisor and you're like typing in like best hotel deals in New York and you have that intent to purchase. So like on the travel side, it's a very high intent channels.

• 2:48:16Jordi Hays?

  Yeah.

• 2:48:16Speaker 07

  If you have something like make money playing games, that actually works really well on social. Cause people are scrolling on TikTok.

• 2:48:23Jordi Hays?

  What's the uh, what's the bit, what's, what, what's the actual economic model for that? Because if anytime somebody says that I, that if you tell John, you can make money playing video games, his, uh, you, you know, I'm a little bit worried. He's going to get on super and and get have a little bit too much fun. He, he likes video games.

• 2:48:40Speaker 07

  Yeah, so I'll tell you, I'll tell you the model on that. And first of all, it's not just games, right? So I'll give you one that's really easy to understand. So if you come to super.com and you wanna make some money and you go to earn, you may see something that says, if you've never taken an Uber before, download the app, take your first ride and get twenty bucks. Pretty obvious, pretty simple. So they'll go in, they'll download the app, they'll take the first ride and we'll just deposit twenty dollars into their wallet. And for Uber, that's obviously a user acquisition strategy. They believe that that customer, and Uber's probably paying us twenty bucks and we're just, you know, or thirty bucks and, you know, and we'll pass most of it back to the member. Um, but for Uber, that's a user acquisition strategy and they can then get that customer to eventually take more rise and that, that's worked out for them and they were happy to pay that twenty bucks.

• 2:49:23Speaker 07

  For game developers, it's kind of the same thing. It's like, you know, you get paid for like, downloading the app and getting to a certain level. Now, if you get to that certain level, then potentially that game developer has generated some revenue from you because you've seen some ads, clicked on some ads, maybe you bought some gems, uh, maybe you did something else. So it's just, it's just almost like an ad network play, um, where it's just another source of user acquisition for a lot of these companies.

• 2:49:47Jordi Hays?

  Are you guys, uh, do you guys spend time, uh, like, thinking about, uh, how you're showing up, how the different products are showing up in L L Ms? Is that a meaningful acquisition channel for, for you guys yet?

• 2:50:01Speaker 07

  It is, it is. So it's something that we're looking at closely. Uh, you've probably seen there's a ton of A I companies that's working to help you optimize how you show up in L L Ms. So some of it is almost traditional S E O ish, where you just kind of need to have that basic infrastructure and write full instruction and write information. But what we're seeing is that the L L Ms are pulling from a lot of user-generated content as well. So things like Reddit and like TripAdvisor forums and, you know, uh, you know, even YouTube for that matter, like wherever user-generated content's happening, they're pulling from that as well. So some traditional S E O and it's actually spending a lot more time and energy thinking about user-generated content and how we can help, you know, be part of and moderate some of those conversations.

• 2:50:43Jordi Hays?

  Totally.

• 2:50:44John Coogan?

  Great. Thank you so much for hopping on.

• 2:50:46Jordi Hays?

  Yeah, congrats on the milestone.

• 2:50:47John Coogan?

  On the milestone.

• 2:50:48Jordi Hays?

  Massive.

• 2:50:48Speaker 08

  Thank you. Appreciate it.

• 2:50:49Jordi Hays?

  One more air horn.

• 2:50:50John Coogan?

  Enjoy the rest of your day.

• 2:50:51Jordi Hays?

  Cheers.

• 2:50:52Speaker 08

  All right. Thank you, guys.

• 2:50:53Jordi Hays?

  Congrats.

• 2:50:54John Coogan?

  Let me tell you about Bezel. GetBezel.com. Your Bezel Concierge is available now. Source you any watch on the planet. Seriously, any watch. Go to GetBezel.com.

• 2:51:02Jordi Hays?

  Legend.

• 2:51:02John Coogan?

  And we have another great dot com coming in to the studio. Keychain.com.

• 2:51:07Jordi Hays?

  Boom.

• 2:51:08John Coogan?

  Simplify your supply chain with AI-powered CPG. Good to meet you. How you doing?

• 2:51:14Speaker 08

  Thank you.

• 2:51:16John Coogan?

  Would you mind kicking us off with an introduction on yourself and the company and maybe some background in how you got into this particular business?

• 2:51:23Speaker 08

  Sure. I'm Mo Sheen Hanrahan, co-founder and CEO of Keychain. I spent the last 14, 15 years building online marketplaces. I built a company called Handy. Handy's like Uber for handy men and cleaners. Built it up to nine figures of revenue, sold it to Angie's List.

• 2:51:42John Coogan?

  Congrats.

• 2:51:43Speaker 08

  Yeah, that was a good outcome. The largest home service company in the.

• 2:51:49Jordi Hays?

  Hey, let's give it up for good outcomes.

• 2:51:55Jordi Hays?

  Sorry, continue.

• 2:51:58Speaker 08

  What gets a ding in a bell? What are the, what are the rules?

• 2:52:00Jordi Hays?

  You never know. There are no rules. Whatever I feel like. But keep, keep, keep it rolling. We'll see. I can feel some more.

• 2:52:07John Coogan?

  I feel some more stuff coming.

• 2:52:11Speaker 08

  I, I took on running Angie's, so I became the CEO of Angie's, ran a public company.

• 2:52:18Jordi Hays?

  Sorry, sorry. I just had to mess with you.

• 2:52:21John Coogan?

  I mean, it is founder.

• 2:52:21Jordi Hays?

  That's right. Yeah. It was fitting. It was fitting.

• 2:52:24John Coogan?

  It's good.

• 2:52:25Jordi Hays?

  Not enough, not enough, not enough founders do that, is to get acquired and then take on the, take on the top.

• 2:52:30Speaker 08

  I don't know if I'd recommend it. It's a lot more work. I feel like when you sell a company, like there's this thing where you can just rest, invest.

• 2:52:36John Coogan?

  Yeah.

• 2:52:37Speaker 08

  And that's what my co-founder wanted to do. He was like, could we not do all the things? Do all the things.

• 2:52:43Jordi Hays?

  You're like, get ready to be important at work, buddy.

• 2:52:47Speaker 08

  Every day, not just some days.

• 2:52:49John Coogan?

  Yeah, that's wild. I advocate that for all my friends who get acquired. I say you should become the CEO of the acquiring company. That should be the goal. But yeah, anyway, you found your way elsewhere.

• 2:53:02Speaker 08

  Yeah, so I was a CEO. My co-founder was Chief Revenue Officer and we ran it all the way to the end of 22. And we both left and we took a little break and then started another company. And we, you know, second time founders tend to do this thing where they think they're going to start a studio company where it's going to have like four or five companies inside it and they won't actually have to run many of them. We tried to do that very unsuccessfully for all of about a month and a half. And there was one idea inside there that just started to work really well. And we doubled down on it and really got behind it. And we've been running it for about a year and a half.

• 2:53:43Speaker 08

  And the idea is to build the platform that CPG runs on. So you guys know this, but most CPG companies don't run their own facilities. They have co-mans or co-producing facilities that run all of their production. And there's a whole industry of about half a trillion dollars in the US of 20,000 companies that make, you know, all the products that you eat, drink, wash your hair with. And we are building the ecosystem and platform for those companies to run on. So we're starting with search and discovery at Keychain. And we've built the deepest database of how brands and retailers find manufacturers.

• 2:54:25John Coogan?

  Yeah, so I am like super intimately familiar with this space. I ran a consumer packaged goods company and it was always a struggle finding, finding supply chain partners. It was always some kind of like loose network of asking friends for favors and whatnot. The best in class database about a decade ago was just from a news website called BevNet. And they did, they kind of aggregated up some manufacturers. I think they let people run ads and it wasn't. Their primary business, they were mostly like a news and reporting organization, a trade, a trade publication. So it makes a ton of sense. I would love to use this product if I was building a CPG company today.

• 2:55:07Jordi Hays?

  Yeah, it's funny, the process, the process, somebody has an idea for a CPG brand, at least pre-keychain. And it was like, you just start asking your friends, people, random people.

• 2:55:17John Coogan?

  Who knows?

• 2:55:17Jordi Hays?

  Hey, how would you make?

• 2:55:18John Coogan?

  Make ice cream? How would you make a protein?

• 2:55:19Jordi Hays?

  I met, I met your co-founder, Jordan, during, I think probably back in 2020, because he was investing in random consumer brands. Super sharp, a kid at the time, now, now clearly a grown man.

• 2:55:33John Coogan?

  Yeah.

• 2:55:34Jordi Hays?

  But, but yeah, this process is, is still, I mean, the, the challenge is, is in how do you make sure that the incremental consumer products entrepreneur and the, I, I would say it's easier to go acquire the customers that are making a lot of net new products or have like a product release schedule. It's also how do you make the, the incremental CPG founder aware that keychain exists so they don't go through the traditional process of just asking friends and asking around, how do I make this thing?

• 2:56:05Speaker 08

  Yeah, I, I think you're right. And that's, that's where we started. So we, we built the product for enterprise. So at, at, at Handy and Angie, some of our biggest partners were the Walmarts of the world and the Targets of the world and the Costcos of the world where we did their home service. So we, we had those relationships and they obviously make most of the private label product in the, in the, in the country comes out of the biggest retailers. So we actually built the product for large, private label, um, brand owners, the people who, you know, churn out product every single day.

• 2:56:38Jordi Hays?

  Yeah.

• 2:56:38Speaker 08

  And that's where we started. Um, so today, eight of the top 10 retailers in the country use keychain. And the same is true actually of the large brands. So you think of the large strategic brands, some of them have invested in keychain like Hershey's and General Mills. They obviously have a lot of facility that they they make some of their own product, but they also contract outsource a lot of it. So we built the product for them to be able to search for manufacturers. And it's funny. So because we built the product for enterprise, we almost got the startup for free. Like, we got the fact that the startups are out there and they're constantly looking, you know, it's harder for them. But because we built this data asset, and you know, I heard you in your last segment talking about SEO

• 2:57:23Speaker 08

  and LLM optimization, we started with the data asset, which is the deepest asset anywhere in the world of US CPG manufacturing. We've invested millions of dollars into building it. And it frankly can tell you who can make what better than any broker, any trade show, any, you know, phone a friend.

• 2:57:43Jordi Hays?

  Yeah, you guys, do you feel like you're is it trade shows that you're disrupting, right? I mean, if you wanted to, if you wanted to go, if you wanted to make CPG products in your target or someone like that, you're going to a trade show and you're like, what can you make for me? Kind of thing. And this just seems a lot more efficient. I went to Expo West once and I almost overdosed on caffeine because it was like, that year, every single product just had maxed out caffeine. It was protein bars with caffeine and all that stuff.

• 2:58:11John Coogan?

  This is deeply bearish for Las Vegas. We need to get Taylor Swift to go to the Sphere immediately because there's going to be no more trade shows after this is done.

• 2:58:20Speaker 08

  Well, we, if you if you had gone last year, I think you would have overdosed on psilocybin because everything seemed to have some form of like mushroom in it. Or you would have overdosed on protein.

• 2:58:31John Coogan?

  There's always a trend.

• 2:58:32Jordi Hays?

  Protein, protein, psilocybin.

• 2:58:35Speaker 08

  Yeah, there you go. You got it. Yeah, you got it.

• 2:58:38Jordi Hays?

  For when you want to build muscle while you hallucinate.

• 2:58:42Speaker 08

  Which is first, but anyway. Um, so we, we don't so much think about it as disrupting trade shows because we really do think there's a role for trade shows. And it's just not what we think. Trade shows are a truly awful way to do structured data discovery. And that's what some people do to trade shows, like they walk around looking for a particular thing. Trade shows are a freaking amazing way to deepen a lot of relationships quickly.

• 2:59:13John Coogan?

  Yeah.

• 2:59:14Speaker 08

  So if you know who you're meeting and you've done the research in advance on keychain and you've set up conversations, you can meet the right 15 manufacturers in 30 minute segments and have the best trip to Expo West ever. Or you can wander around getting absolutely loaded on caffeine because you're going from booth to booth to booth and have a pretty ridiculous time and maybe you meet two of the right people. So it's like, how do you take structured data and figure out how to appropriately use the right tools so that you can have a great trade show experience? And that's the first, that's effectively the first product the keychain has launched. So that product today is in month 18 and it does about a billion dollars worth of

• 2:59:58Speaker 08

  search volume per month.

• 3:00:00John Coogan?

  Wow.

• 3:00:00Speaker 08

  Uh, and we're in the process now of launching our second product, which is a bridge into the operating system for manufacturers.

• 3:00:10John Coogan?

  Yeah. Uh, last question, we, we, we gotta let you get out of here, but, uh, we have one more sound effect. Do you have any fundraising news for us?

• 3:00:19Speaker 08

  Uh, we, we do, yeah. We, we, we raised a little bit of money.

• 3:00:22John Coogan?

  How much did you raise?

• 3:00:24Speaker 08

  We've raised in total, the last round was 30 million, so we've raised $60 million. Oh, congratulations.

• 3:00:34Jordi Hays?

  It's almost like you've done this before.

• 3:00:38Speaker 08

  The ding and the bell thing?

• 3:00:40John Coogan?

  This, yeah, that gong hit is authentic. That's an analog. We have a real gong.

• 3:00:45Speaker 08

  Oh, that one's real.

• 3:00:46John Coogan?

  That one's real. Yeah.

• 3:00:47Speaker 08

  That wasn't a video of you doing that before.

• 3:00:50John Coogan?

  No, no, no, no, we have a real gong. Anyway, thank you so much for hopping on the show.

• 3:00:54Jordi Hays?

  Awesome. Yeah, great to meet you. Congrats on the milestone.

• 3:00:56John Coogan?

  We'll talk to you soon.

• 3:00:57Speaker 08

  Be careful. Bye.

• 3:00:59John Coogan?

  That was a very cool segment. I would have killed for that in 2012. Anyway, let me tell you about Wander. Find your happy place. Book a wander with inspiring views, hotel-grade amenities, dreamy beds, top-tier cleaning, and 24/7 concierge service. It's a vacation home, but better. And up next, we have a guest in the Restream waiting room. Let's bring him into the TDPN Ultra Dome.

• 3:01:21Jordi Hays?

  John, welcome to the show.

• 3:01:23Speaker 09

  What's happening, guys? How are you?

• 3:01:24Jordi Hays?

  How are you?

• 3:01:25Speaker 09

  Good. This is, I'm just looking, I mean, this is what the fortress looks like, man.

• 3:01:31Jordi Hays?

  Welcome to the fortress.

• 3:01:32John Coogan?

  This is finance.

• 3:01:33Jordi Hays?

  Welcome to the capital.

• 3:01:35Speaker 09

  Thank you for having me. We love you, guys.

• 3:01:38Jordi Hays?

  We love you, too.

• 3:01:38John Coogan?

  For hopping on.

• 3:01:39Speaker 09

  Yes, it's phenomenal, so.

• 3:01:40John Coogan?

  Kick us off with just a brief introduction on yourself, a little bit about your career, and then I want to go into the, the, the hope for common stock, the bull case for, for startup common stock.

• 3:01:52Speaker 09

  Yeah, for sure. So I'm John Callahan. I've been an entrepreneur and venture capitalist for a long time. We started True in 2005. We're an early-stage firm.

• 3:02:04John Coogan?

  There's also sound effects.

• 3:02:05Jordi Hays?

  Twenty-year, twenty-year overnight success.

• 3:02:07Speaker 09

  Yes, yeah, exactly. That's the way it all is here in the night. So, yeah, so, you know, we, we started the firm with a vision of, frankly, our tagline was more venture, less capital. We thought the world needed venture capitalists who were going to, you know, take big risks and entrepreneurs, you know, were coming out at that point, by the way, post sort of bubble crash, post 1.0 crash. There were a lot of new technology changes, DHTML, open APIs. So all of a sudden, all these really creative founders were coming up with really cool ideas. You guys remember mashups? And, you know, it was, it was, you could do a lot of things with all of this infrastructure that had been built in the 1.0, and you could build a lot of application layer value.

• 3:02:48Speaker 09

  So that, that is, that is a pattern I will talk to you about here about what we're seeing today. So. That worked out really well for us. True has been extremely lucky. We've been investors in category-defining companies like Fitbit, Peloton, Ring down in LA, Jamie Simonoff is awesome, also in LA, Sweetgreen with John Neiman.

• 3:03:09John Coogan?

  Uh, Ring, which, which Ring? Isn't, uh, Ring the security company?

• 3:03:15Speaker 09

  I can make a joke that say there is only one.

• 3:03:17Jordi Hays?

  There's only one.

• 3:03:18John Coogan?

  Security company.

• 3:03:18Speaker 09

  There's only one. The one that protects you and your family and your neighborhood, Ring.

• 3:03:22John Coogan?

  Yes, yes, yes, of course.

• 3:03:23Speaker 09

  Yeah, we, uh, the company is acquired by Amazon.

• 3:03:25John Coogan?

  Yeah, that's right, that's right.

• 3:03:26Speaker 09

  And Jamie's up there.

• 3:03:27Jordi Hays?

  I have a funny Ring story. Uh, someone on our team was, was dropping something at my house the other night.

• 3:03:32John Coogan?

  Oh, yes.

• 3:03:33Jordi Hays?

  And I'd see somebody with a hat on and a backpack on outside, walking around my car. I'd already, I was already in, uh, like about to go to sleep or whatever. And I fully thought, uh, Dylan on our team was, was somebody doing a break-in. So.

• 3:03:49Speaker 09

  Yeah, in the early years of that, in terms of what Jamie, you know, I think at one point they caught a criminal a day. They did a big thing with the LAP. It was just awesome. But also like the wild animals and all the crazy, anyway.

• 3:04:00Jordi Hays?

  Yeah.

• 3:04:00Speaker 09

  Ring is great. We're also big in enterprise. Uh, we do a security, HashiCorp, all sorts of other things. We've had seven IPOs, 60 M and A. So we've been doing this a long time. Um, and we're the biggest in our category of, of pure seed, four billion in capital, 16 partners. Um, it's all we do. All we do.

• 3:04:19John Coogan?

  That's amazing.

• 3:04:19Speaker 09

  Yeah.

• 3:04:20John Coogan?

  Um, yeah. So take me through, uh, like the last few cycles from your perspective, what's changing around, uh, where the founder sits in value accrual, common stock, uh, how you process Zerp and the last bubble and crash and all of that.

• 3:04:38Speaker 09

  Yeah, for sure. So that's kind of what caused me to write this piece. And it's like, like all things, I've been, you know, it, it, the good ones always take like an hour to write, you know, kind of thing. And the other things that you kind of nash around. So, um, been doing this a long time and have seen a lot of waves and we've been a part of a lot of waves. And, um, The things that we are experiencing now, and I can talk through them around AI, but it's really capital efficiency, which we'll talk a lot about. That drives a lot of the sort of solution to the tragedy or the fixing of the tragedy for common. But capital efficiency, the size of the TAMS, you know, the founder ethos today, your question right now, John, like what's happening with founders? It's all leaning much more towards this do more with less.

• 3:05:22Speaker 09

  The conversation now at, you know, Great White in LA or at Cooper in Palo Alto or, you know, is, or Blue Bottle at South Park. It's all about like how much I can build with how few either, you know, employees or, or, or capital.

• 3:05:38John Coogan?

  Sure.

• 3:05:38Speaker 09

  And that's a good thing. You know, you guys talked about the earnings release yesterday of Nvidia, but Jensen said yesterday, there's two to three, I think he said three to four trillion

• 3:05:48John Coogan?

  Yeah.

• 3:05:49Speaker 09

  of CapEx. Our numbers internally are sort of two to four trillion of CapEx going in to the, to, to the AI wave over the next five years.

• 3:06:00John Coogan?

  Yeah.

• 3:06:00Speaker 09

  So any other wave, web two, mobile, cloud, that we've been a part of, the value that is created at the, at the application layer on top of that CapEx is on the order of five to 10x. So we're talking about new TAMS, like markets that haven't been invented yet, that we don't know about yet, net new consumer behaviors, net new enterprise behaviors at a level that is, you know, I don't want to say that like unprecedented, but like it's just really big. And as you guys have noted a lot on the show, the wave is happening really fast, quite a bit fast. The waves kind of keep coming in faster, in faster increments.

• 3:06:44Speaker 09

  And we're just seeing that combination come together and create what I think is the vintage of a lifetime as a venture capitalist or as a founder. We've got the most powerful tools we've ever seen. On the TAMS, you know, like we, we talk a lot about software. It's one or two trillion dollars globally. I think it's like 1.2 doubling in five years as a market. It's super big. Yeah. Services are 17 trillion today.

• 3:07:12John Coogan?

  Yeah.

• 3:07:12Speaker 09

  Doubling to 30, 30. So like you have these.

• 3:07:16John Coogan?

  Yeah, I want to push on that common point because I feel like you're you're you're correct that revenue per employee has never been higher, but I feel like with like maybe mid journey is the exception that proves the rule, but founders have not turned their turned a cold shoulder to preferred equity in this cycle. Like, there are plenty of founders who are saying, yeah, I'm fine selling 10% of this company every six months. And and they've done very well.

• 3:07:44Jordi Hays?

  15% every three months.

• 3:07:46John Coogan?

  And each deal has been accretive to the share price potentially, but you know, they are getting diluted. And and I'm wondering if there's more nuance to that.

• 3:07:56Jordi Hays?

  Yeah, more opportunity than ever to do to do more with less.

• 3:08:03John Coogan?

  Yes.

• 3:08:03Jordi Hays?

  But at the same time, more.

• 3:08:04John Coogan?

  More opportunity to do more with more.

• 3:08:06Jordi Hays?

  The opportunity is so large, there's a lot of reasons.

• 3:08:09John Coogan?

  If I could do more with less, imagine how much I can do with more.

• 3:08:11Speaker 09

  You can do with way more.

• 3:08:13John Coogan?

  I can do with way.

• 3:08:13Speaker 09

  I think it's a matter of magnitude here and context. And you mentioned Zerp. So we have to kind of talk about Zerp. It's been super well covered, but like, that distortion is at a level, you know, remember it was like a decacorn a day was being crowned. There's three, again, trillion dollars of limited partner capital locked up in in zombie unicorns, according to Bill Gurley's estimate, which I referenced in the in the in the piece and.

• 3:08:37Jordi Hays?

  But are we not, you you do you think this time is, do you think this time is different?

• 3:08:42Speaker 09

  I think that time was different. So the answer is no, I'm not I'm counting on this time being a time that is like other waves. The reason the distortion, by the way, like, we should talk about it for a second. So and well, here's why I think this time won't be Zerp. How's that for nuanced, right?

• 3:09:01Jordi Hays?

  There you go. Yeah.

• 3:09:03Speaker 09

  Yeah, it's the same people, like the founders, if you look at the senior leadership at at at startups and companies, they were the ones who, you know, were at different levels through Zerp. They've been stuck under the stack. I'm not saying zero equity. And and in fact, if you look at the last couple of, I don't know, maybe four quarters, there's probably been 20 mega seed rounds, the 350 million dollar seed round or whatever, 20. There have been 2,500 seed deals done first half this year.

• 3:09:34Speaker 09

  And you know, it's power loss. You're going to have lots of failures and stuff, but just, just when you look at Zerp on a magnitude basis, so much distortion happened. And I'm not saying there's not going to be those companies to your point that just keep raising and raising. But I think founders are going to be a lot smarter about post-money valuation because most of, as you guys probably know, that the 14.

• 3:09:55Jordi Hays?

  There's a, there's a company that, there's a company that I won't name that is a, a perfect example of this. They've raised under a million dollars. So, single, yeah, hundreds of thousands of dollars. They're doing millions of dollars in revenue. They have logos from every single top AI company and they're just growing like a wheat. Like it's just clearly they're on to something and the founder has no real interest in raising. He could probably, like, he feels like he can take it as far as it can go, just off of just raw customer demand.

• 3:10:33Speaker 09

  You guys had Wade on, I think, last week, right? The great example of a company that, you know, raised a little, but kept making the choice. I think that term you guys talked about was super cool, seed scaling. I hadn't heard that, but it's, but it's what we're seeing. So I guess, John, the answer is like, I'm not saying no venture capital. I'm just saying. Yeah, of course.

• 3:10:53Jordi Hays?

  Yeah, and Zapier, Zapier is funny because the, the category that they're in, which is like agentic workflows, is like, they're, you know,

• 3:11:07Jordi Hays?

  dominating, you know, having, having been building this business for such a long time. And yet I can think of like a hundred companies that have raised on the same kind of core idea of what they're doing. So it, that category is like turning into a crazy capital war, but hopefully Zapier is in a point right now, given that they've been at it for so long, that, that they can just keep playing their own game.

• 3:11:31Speaker 09

  Yeah, and in a world in which if it's true that on top of all this CapEx, all these net new companies and behaviors are going to will be created, there's I just think there's a lot of room. We have one thing we've done as technology as all of us is we have always underestimated the potential. And we've underestimated the tail, like both the curve and the tail of everything. It's web two is still booming along. Mobile is still booming along at massive numbers. And so

• 3:11:59John Coogan?

  Look at Oracle's stock price. Oracle is still crushing.

• 3:12:03Jordi Hays?

  About to be the mag eight.

• 3:12:04Speaker 09

  It is. Yeah. So there's, I think there's a lot there. And then the last point on the common is just that, like, you know, that has fueled Silicon Valley, right? It is fueled Silicon Valley for all sorts of different outcomes to, you know, sprinkle wealth or gains down throughout a company's stack. And then those, I mean, literally I said in the past, this happened thousands of times in my career where that engineer or, you know, VP or director then takes more risk and and that's what we need. And and that has fueled the valley. And so my thinking is that it's is that the Zerp distortion is what was different, but that Silicon Valley is when, you know, I would never bet against the valley would never bet against creative destruction.

• 3:12:48Jordi Hays?

  The when when companies, you know, as an investor, when I was looking at trying to figure out the why now, investing in 2021 and 2022 and in fintech, it was like, okay, Stripe exists, Plaid exists, you have these new kind of like infrastructure players that allow you, you know, there's better banking as a service platforms. But the why now was like, it wasn't necessarily, it didn't feel fully like a why now. And then you'd end up paying a hundred times revenue for basically a lending company that like, yes, they benefited from like, you know, Plaid being, you know, like what it was at that time in in terms of, you know, market penetration, but

• 3:13:31Jordi Hays?

  it wasn't, you know, in the end, a lot of those businesses didn't really, they didn't end up really going anywhere. Whereas I think having a real why now today, you know, it's not founders very easily talk and investors will talk themselves into being like, okay, they'll talk themselves into feeling like there's a why now, even if they're just kind of fabricating it.

• 3:13:55Speaker 09

  Yeah, you know, why now? You've talked a lot about it in the enterprise, but the why now in the enterprise has caused, you know, a lot of new entrants to have great success against incumbents, right? That's super interesting. They're all sorts of new, again, this whole like, if you were talking about enterprise software a few years ago, kind of pre-AI, you'd look for these like tiny little verticals where you could have an advantage. And now the whole playing field is open to startup founders. And they're having incredible success, either in, you know, but you've, you've, you've had a bunch of them on your show.

• 3:14:29Speaker 09

  And I think that's also really interesting, not without it. So it's coming from the customers, right? It's coming from the buyers of technology, want this new thing, incumbents have a hard time delivering that new thing. Not going to be smooth, like, like, you know, I like how you're talking about where you're on the hype cycle, like it's going to be bumpy throughout the curve. But it's just a remarkable time in all of these markets. And, and I think that's spectacular. I mean, again, I think it's, it's, it's a chance of a lifetime for a builder to start something now with, with these dynamics.

• 3:15:03Jordi Hays?

  Yeah, I remember being, I mean, I graduated, graduated college in 2018 and feeling like I had met, you know, missing mobile, right? Like not being an adult for like a massive tech trend like that felt, you know, I, I had read the TechCrunch headlines for years of all those companies, but not having been actually in the trenches, feeling like praying for another, praying for another bubble.

• 3:15:32Jordi Hays?

  Certainly got one with, with a real, you know, potential that we're already seeing.

• 3:15:37John Coogan?

  Well, thank you so much for hopping.

• 3:15:38Jordi Hays?

  Great having you on, John.

• 3:15:39Speaker 09

  Awesome to see you. Hey, guys, we invited you to our thing in San Francisco, the Connected Stack. We'd love to have you.

• 3:15:45John Coogan?

  Oh, fantastic.

• 3:15:47Speaker 09

  Huge enterprise AI thing. Can't do the show from the floor, whatever. Boston, 2020, a lot of founders, whatever. Thank you for having me. It's awesome. We really appreciate what you guys are doing.

• 3:15:58Jordi Hays?

  Come back on again soon.

• 3:15:59John Coogan?

  Yeah, we'll talk to you soon.

• 3:15:59Jordi Hays?

  About that.

• 3:16:00Speaker 09

  Have a good one. See ya.

• 3:16:02John Coogan?

  Up next, we're going over to air.ink. Have you used this product before? I used this and was obsessed. It's like, I don't know, I'll let him describe it.

• 3:16:11Jordi Hays?

  Should we be using it?

• 3:16:11John Coogan?

  Let's bring him in. We absolutely should, and that's why I was so excited to talk to him, because it was like, you can pitch us directly on the show.

• 3:16:18Jordi Hays?

  Yeah.

• 3:16:18John Coogan?

  Use this product.

• 3:16:19Jordi Hays?

  Sales call.

• 3:16:19John Coogan?

  Hopefully, we didn't keep them waiting too long. How you doing?

• 3:16:23Jordi Hays?

  What's happening? Sorry, we're running behind. Great to meet you, Shane.

• 3:16:27Speaker 10

  Nice to meet you guys. Thanks so much for having me.

• 3:16:29John Coogan?

  Yeah, thanks for hopping on. Can you just introduce yourself, the company, a little bit of the backstory quickly?

• 3:16:35Speaker 10

  Of course. It's great to meet you, Bill, Shane Hegde. My co-founder Tyler and I started a business called Air. It's an enterprise software company. We help creative teams manage all their media assets. So we help them store and organize all their content and then execute on the day-to-day workflows of making quality images and videos, putting them out in the world.

• 3:16:55John Coogan?

  Yeah, I was-

• 3:16:57Jordi Hays?

  The anti-slop company.

• 3:16:59John Coogan?

  Yeah, I mean, like-

• 3:17:00Speaker 10

  It's an attempt.

• 3:17:01John Coogan?

  There is some, I feel like there's some crazy link between like your clients or your company, your customers and like the brand, like the culture at your company feels like particularly designed forward. Like, I'm looking at your landing page and it's incredible. I don't know, like, where this-

• 3:17:20Jordi Hays?

  They're talking the talk and they're walking the walk.

• 3:17:21John Coogan?

  Yeah, exactly. Like, were you guys designers beforehand? Like, was this something that like came from a particular person inside the organization? Is it just like everyone in the company is so focused on design?

• 3:17:32Speaker 10

  I think, you know, look, if you're going to sell a product to creatives specifically, that's going to be your ICP, you really have to live and breathe the market. You have to put out great content on an ongoing basis to talk about the narrative of what you're doing. And you have to meet those expectations with how you deliver the product. The marketing side is just an extension of the product. So I think in many ways, it's come from an obsession about who our customer is and how we meet them, where they are, with what they care about.

• 3:18:03John Coogan?

  Yeah, talk about the marketing. I've seen a few of the stunts that you guys have done. The latest one with the Rizler, like, what? This is a very, it's a-

• 3:18:10Jordi Hays?

  Yeah, when did you know you wanted to work with the Rizler?

• 3:18:13John Coogan?

  When did you know that you wanted to be the first enterprise software company to probably partner with him? It's just a wild choice.

• 3:18:20Speaker 10

  Look, I think if you look at great generational enterprise software businesses, they all have a singular go-to-market motion that contributes to fifty to sixty percent of growth. And every enterprise software business chooses a different channel to really focus on depending on who their customer is, what they're good at, and where there's arbitrage in the market. For us, it's content marketing. And there's a nuance in how we approach content marketing that we call culture-led growth, which is all fancy words to describe the format of content marketing that we do. It's not HubSpot SEO or Gong social all the time.

• 3:19:02Speaker 10

  For us, it's great, you know, seminal campaigns that we put out in the world that espouse, you know, the narrative of what we do, whether it's product marketing or just a viral campaign with a, you know, fourteen-year-old. It doesn't matter. You're pushing a story out to the market and getting a group of folks who care about that resonate with it and begin a conversation with you. So that's how it took years to get here to a point where we knew, working with the Rizler or Kareem or Taylor Lorenz or any of the other influencers with the right ones. But it's been a fantastic motion and wildly efficient for us.

• 3:19:39Jordi Hays?

  How much have you, you know, I appreciate, I remember when Air launched and I remember thinking, you know, I worked on, worked with a ton of different companies on, you know, marketing campaigns and stuff like that over the years. So I understood the value prop, even though I felt like it was almost a, it was a contrarian move to launch like what the original product like helped you just store assets. And a lot of people, I'm sure even VCs back then would have said, well, like,

• 3:20:08John Coogan?

  Stuff it in a folder.

• 3:20:09Jordi Hays?

  They get Google Drive off the, they're getting Google Drive for free. It's going to be tough to compete, but clearly there was, there was demand for this. Now,

• 3:20:21Jordi Hays?

  How are you guys thinking about, not to ask like a very VC-coded question, but I'm genuinely genuinely interested. How are you guys thinking about leveraging generative AI if you house all the, you know, brand assets for a business and you can understand kind of like the aesthetics of a brand, it puts you in a good position to not just store assets, but help people generate new ideas?

• 3:20:44John Coogan?

  Just like automatically matching assets to tags and like creating like an ontology on top of the data.

• 3:20:51Speaker 10

  Totally. I think, you know, in this moment in time, there is a rush to value. Everybody, every enterprise out there is trying to immediately get to the thing that's going to compound their business on an accelerated basis. The last conversation you guys were in, I love that tail end of that conversation around, there's never been a more open environment in the enterprise for new entrants like us to come in and rebuild the entire stack of how a company operates. But when you look at, at different areas of the enterprise, in order to scale, you have to have, or automate, to your question around AI, you have to have

• 3:21:28Speaker 10

  a place to automate from. You know, said another way, slop in is slop out, and the richness of your solution is going to depend on the richness of the data that you, that you build on top of. In every area of the enterprise, there has been a system of record that has structured and organized the data so that you can automate and centralize. This has been playing out for 25 years. You know, it started with Salesforce, building out what we now see as a CRM, as a must-have inside of a business if it's trying to scale sales. Same thing with development cycles with GitHub, or, you know, marketing work with HubSpot for multi-touch attribution. There's never been a system of record built for creative

• 3:22:11Speaker 10

  work, for images, videos, PDFs, visual forms of data. At the highest level, if you asked a CMO or a creative director,

• 3:22:20Speaker 10

  You know, how are your assets performing? What's performing best? Where are you going to invest in next? That's like a six-month job for an analyst. And at the lowest level, if you're trying to talk to a designer about what they do every day, they spend 75% of their time collecting content, approving content, sharing content, and doing all of that all over again. And so our ambition at Air is to build a system of record for creative work. It's one product. We're never going to build a second product at Air. We're just going to go deeper and wider in what we do. And yes, you got to start with storage. That's the hard problem to start with. You have to sync and organize millions. Today, we're up to about 150 million assets that are being managed in our product. But the magic is on what you can do on top of that.

• 3:23:04Speaker 10

  You know, the workflows that you can automate, whether that's rights management or whether that's like generating variance of something that you could plug into different ad units. It shouldn't matter. It can all sit on top of the baseline architecture.

• 3:23:16Jordi Hays?

  You should create a workflow to help legacy brands not get canceled by zoomers. So it's like, it'll pop up an alert, "Hey, boomer, if you, if you put this on social media, you're going to get canceled by the zoomers." And I think that could, that could save billions of dollars of lost market cap.

• 3:23:38Speaker 10

  I hope, I hope that the, you know, one, it's funny. We had a, we had a hackathon that finished this morning. And one of the things that came out of it was a newsletter that goes out on an automated basis to admins inside of a workspace. And because if you're thinking about our product, about 15% of our customers have more users on air than they have full-time employees. Starts with your creative team, expands to marketing, sales, product partnerships, your agencies, your influencers that you work with. And then the other dynamic i- is that, you know, about 11% of our customers spend more than, more than...

• 3:24:17Speaker 10

  25 hours a week inside of our product. And so this newsletter explicates what all everybody did and spits out a summary of that with all of the work to the admins in the workspace. And so visibility, I think, you know, to go to your point around boomers and zoomers and not getting canceled. Visibility, I think, is really important. And our opportunity to do that in a system of record is is no different than Salesforce providing a dashboard to your CRO to understand like which reps are performing the best or where to lean in segment wise or why, you know, win rates have improved.

• 3:24:54John Coogan?

  Yeah, totally makes sense. Amazing. Anything else?

• 3:24:58Jordi Hays?

  No, this was, this was great. Come back on anytime. You're the only, only person in the world so far that has made just storage interesting.

• 3:25:09John Coogan?

  Anyway, thanks so much for hopping on.

• 3:25:11Jordi Hays?

  And yeah, we're gonna, we're gonna, we're gonna actually sign up for this because we were, we were at a very, we were very much.

• 3:25:16Speaker 10

  Yeah, can we put you guys in the game here? Come on. You guys are, you guys are the sort of beacon.

• 3:25:21Jordi Hays?

  Yeah, well, we were, we were iMessage scale where like our version of air right now is just the group chat.

• 3:25:26John Coogan?

  Yeah, it's literally all iMessage. It's a mess.

• 3:25:28Speaker 10

  Come on, John, can you make the intro to Soylent? We're in the mix here, you know, put us in the game.

• 3:25:32John Coogan?

  Yeah.

• 3:25:33Jordi Hays?

  Let's do it.

• 3:25:34John Coogan?

  Thanks, man.

• 3:25:34Jordi Hays?

  Great to meet you.

• 3:25:35John Coogan?

  I'll talk to you later.

• 3:25:36Jordi Hays?

  Cheers.

• 3:25:39Jordi Hays?

  All right, we're gonna cap this off by just pulling up this post of what the Garmin horse tracker actually looks like.

• 3:25:46John Coogan?

  Okay. Yeah, you want to end with the Garmin horse tracker?

• 3:25:49Jordi Hays?

  This is the most important story of the day.

• 3:25:50John Coogan?

  Story of the day for sure.

• 3:25:52Jordi Hays?

  Garmin mid, it's a.

• 3:25:54John Coogan?

  Yeah, I see it wraps around the horse's tail. Where, how else do you think you are tracking the horse's health, Jordy? Garmin is now selling a wearable you put on your horse. It goes on the tail, obviously.

• 3:26:07Jordi Hays?

  No, no, no, it's further down in the stack.

• 3:26:10John Coogan?

  So that's what it looks like when it's not on the horse, but when you apply it to the horse while you're wearing your Garmin watch. So you can be riding your horse, check your horse's vitals from your Garmin watch. That's the future I want to live in. That's horsepower, baby.

• 3:26:25Jordi Hays?

  This is important. I mean, this is a trillion dollar company to me. They're sitting in.

• 3:26:29John Coogan?

  This is.

• 3:26:29Jordi Hays?

  Look at this thing.

• 3:26:30John Coogan?

  Look, do it on that horse tail tracker. What is it actually tracking here? Midnight, outdoor training sessions, indoor training sessions, recovery, transport. Max Activity Heart Rate, it calculates the heart rate, how many strides. You can view the data live and then Sugar's got a bunch of strides. That's hilarious. No, this seems, this seems amazing.

• 3:26:53Jordi Hays?

  Absolutely beautiful stuff. This is why we love technology.

• 3:26:55John Coogan?

  As, as much of a breakthrough as, as Waymo, you know, it's already.

• 3:26:59Jordi Hays?

  Really, arguably more important.

• 3:27:01John Coogan?

  Arguably more important.

• 3:27:02Jordi Hays?

  For some.

• 3:27:03John Coogan?

  Horses are self-driving.

• 3:27:04Jordi Hays?

  Uh, thank you for tuning in today. Uh, Max, uh, Conrad from the Substack chat. We needed this time is different sound effect. I agree.

• 3:27:15John Coogan?

  Yes.

• 3:27:16Jordi Hays?

  Uh, this time is different. This time is different.

• 3:27:19John Coogan?

  Yeah, there must be some clip from like a movie where someone said that or something. Where, where, where does that this time is different actually come from? Maybe we can get Warren Buffett saying it or something. I'm sure he said it at one of his, uh, meetings or something.

• 3:27:29Jordi Hays?

  Yeah.

• 3:27:30John Coogan?

  Uh, anyway.

• 3:27:30Jordi Hays?

  Thanks for hanging with us today. We love you. We will see you tomorrow.

• 3:27:34John Coogan?

  Have a great day.

• 3:27:35Jordi Hays?

  Mansion section.

• 3:27:36John Coogan?

  Oh, you're ready.

• 3:27:37Jordi Hays?

  Cheers.

• 3:27:37John Coogan?

  Bye.