Insurance Companies Deep Dive, Wanted Fugitives, Run On Mahogany, Yearling Lot 1007

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

• 0:00John Coogan?

  Welcome to Technology Brothers, the most profitable podcast in the world. Jordy, why are you wearing a mask?

• 0:06Jordi Hays?

  You know, Taylor Lorenz might say, "My culture is not a costume."

• 0:12Jordi Hays?

  But to that, I would say, "I'm wearing this mask to draw attention to the very real fact that the air in LA, even though the AQI is a decent spot, is still deeply toxic. A lot of the buildings that burned this last week were created at a time when we had very different building codes. And so a lot of the materials that were used." And in some group chats locally that I was in, people were...

• 0:39Jordi Hays?

  I'm actually coughing.

• 0:40John Coogan?

  He's dying.

• 0:42Jordi Hays?

  No, so people were basically saying that a lot of this stuff is, you know, if you're breathing in these toxins, health issues can oftentimes show up like years and years, decades down the line. So...

• 0:56John Coogan?

  Dude, you know what blew my mind?

• 0:57Jordi Hays?

  Brother Ben got these masks for us to record. I think I'll take it off.

• 1:01John Coogan?

  Yeah, we are inside.

• 1:02Jordi Hays?

  Ventilation here, but everybody should be wearing masks. It's annoying. It was cringe. And when the experts told us to wear a mask last time, maybe it wasn't based purely on... I probably shouldn't. If we say "experts," YouTube algorithm will probably flag us.

• 1:16John Coogan?

  Who knows? I think we're already flagged.

• 1:18Jordi Hays?

  Anyways, wear a mask if you're around.

• 1:21John Coogan?

  You know what really makes me like, kind of like, terrorized is you see these tours of the burned down houses, and you'll see like, the chimney is still there in most of these houses, because the chimney is made out of bricks, but there's nothing else standing. And I'm like, "Where did the refrigerators go?" Like, the refrigerators are made of metal and plastic, and they literally just melted, and that went up in the air. So you're just breathing a refrigerator. If you're breathing the air, it's crazy.

• 1:47Jordi Hays?

  Did you see that there were cars that had, I think, aluminum wheels that just melted in these crazy patterns? But anyways.

• 1:56John Coogan?

  Wild.

• 1:56Jordi Hays?

  So.

• 1:58John Coogan?

  I mean, if you want to hear some crazy stuff, we should start with this first. We're going to do a couple deep dives, give you a little bit of history on the insurance industry. We're going to, you know, move on. We're going to still be talking about tech this week, but we thought this was an interesting opportunity to kind of break down some, you know, founders, investors, entrepreneurs who have had a major impact in insurance, construction, home development, real estate. So we're going to be taking you on a little bit tour of, you know, we always like to ask the question, even in a disaster, like who's making money, who's losing money? And you heard on a previous episode, we did a whole deep dive on Rick Caruso, learned about his career, but there are a lot of other people that, you know,

• 2:38John Coogan?

  their innovations will be important to getting LA back to where it was before the disaster. And there'll be a lot of people that come in with new businesses. And so we want to, we want to deep dive all that and use that as kind of like the theme for the week, more or less.

• 2:51Jordi Hays?

  Yeah. And for, I guess for some context, because, you know, we're here in LA, so we've been sort of pretty fixated on everything going on. But as of right now, they're projecting that these fires will have caused somewhere in the range of $150 billion is the official number as of now. Everybody expects that to tick up over 200 at some point. I believe that Hurricane Katrina was somewhere around 200.

• 3:16John Coogan?

  Yep.

• 3:16Jordi Hays?

  So this will be more damaging than Hurricane Katrina. And then even to put it further into context, the, the previous most costly wildfire in US history was a campfire, which happened near Chico, up in Northern California. And prior to that, and, and another more recent event was the Lahaina Fire, which was $6 billion. And then under that is the Woolsey Fire, which actually burned down the house that I bought last year, had to be completely rebuilt from the ground up. So just to put this into perspective, Lahaina Fire was devastating, but it will be a tiny, tiny, tiny, tiny fraction in comparison to the damage caused by the LA fires or the Newsom Fires,

• 4:00Jordi Hays?

  as I think we're calling them, or the Bass Fires. Simon was putting the word out to ask, you know, what we should call them, but. Without further ado, why don't we, we want to kind of get into-

• 4:12John Coogan?

  Well, I gotta read about a historical fire first. Because it's, I mean, this, like, the real definitive story of the Palisades Fire has not been told yet, but two years ago, there was a massive fire, wildfire in Australia. And The Economist wrote a really, really eloquent and interesting deep dive on what happened and how they're changing things going forward. And I think there's a lot that you can learn about it. So, "Australia is the most, is the world's most fire-prone continent. When temperatures rise and the hot winds blow, a lightning strike or cigarette butt tossed thoughtlessly out of a car window can spark a flame that rapidly burgeoning into a panorama of hell." I love this writer, he's so good.

• 4:53John Coogan?

  "Temperatures at the heart of the blaze rise to 1,600 degrees Celsius, hot enough to melt steel. These hurl dry lightning and bursts of hot air earthward, stoking the conflagration further." Hundreds of these fires burned across Australia in the antipodean summer of late 2019 and early 2020. There were a bunch of volunteer firefighters described being caught inside fire tornadoes, their engines overturned by vortexes of scalding wind. As residents-

• 5:27Jordi Hays?

  Engines overturned is insane.

• 5:29John Coogan?

  Yeah. "As residents made their escape, they saw the aluminum wheels of parked cars melt and run down the gutter like water." By the end of summer, Australia lost 34 people and approximately 1 billion animals. Isn't that an insane stat? It's crazy. And then they go on to talk about how the smoke was so large it reached the North Pole, possibly for the first time.

• 5:54Jordi Hays?

  That's insane.

• 5:55John Coogan?

  And the question is, how do we survive this age of fire? The pyro scene. And they go into talking about some of the- The original people who settled Australia have a whole bunch of firefighting techniques.

• 6:10Jordi Hays?

  Yeah.

• 6:11John Coogan?

  And it all starts with just being able to look at a mountain and understand, is it ready for a controlled burn? Is the ground wet enough? So you're supposed to burn when the ground is wet, so just the top burns and it doesn't get as hot.

• 6:25Jordi Hays?

  Yeah.

• 6:26John Coogan?

  And he has a bunch of, this dude they interviewed is like such a badass. A tall, broad-shouldered, 48-year-old Australian, Victor Stephenson, believes the solution to Australia.

• 6:36Jordi Hays?

  His name's Victor?

• 6:36John Coogan?

  Yeah. Victory, yeah. Believes the solution to Australia's blazes lies in his people's ancient understandings of their lands. Australia's native flora evolved to thrive in fire. Banksias, a type of evergreen bush, holds their seeds in woody capsules, and these open, like, cooked mussels when they're scorched by flames and the seeds are released onto the cleared ash.

• 6:59Jordi Hays?

  So that's, that's a big issue, though, is a big issue this last week is eucalyptus trees, which we imported.

• 7:04John Coogan?

  Yep.

• 7:05Jordi Hays?

  Apparently, when they burn, they have this sort of toxic oil that gets released that's super flammable.

• 7:10John Coogan?

  Yep.

• 7:10Jordi Hays?

  And so it's been very clear that the landscaping that you use, vegetation, it's a good argument to say we should just eliminate all eucalyptus trees.

• 7:21John Coogan?

  Yeah, I mean, here it says, some eucalyptus species require burning to make new shoots sprout. Like, you're supposed to burn them regularly.

• 7:29Jordi Hays?

  Yeah.

• 7:29John Coogan?

  And so they're not, if they're in an area where there's enough fire prevention to not have regular fires, they're just gonna build up and then it's just a tinderbox.

• 7:36Jordi Hays?

  Yeah.

• 7:37John Coogan?

  Really, really bad.

• 7:39John Coogan?

  So, yeah.

• 7:39Jordi Hays?

  Yeah, it's so, it's so wild, too, because all this stuff was super top of mind, because I just went through the process of getting home insurance and I almost had to use the California Fair Plan. And I ended up finding another provider, but the California Fair Plan, which we'll get into at the end of this episode, is probably.

• 8:01John Coogan?

  Bankrupt.

• 8:02Jordi Hays?

  I mean, it's definitely, it's kind of this weird, public-private group, but it's probably.

• 8:09Jordi Hays?

  Uh, DOA.

• 8:12John Coogan?

  Yeah.

• 8:13Jordi Hays?

  But anyways.

• 8:13John Coogan?

  This guy is such a Chad. He says, if you can't burn barefoot, you're probably doing it wrong. Just like, yeah, I'll go out and do a controlled burn barefoot because I'm so confident in the way that I can burn, that the ground's not going to heat up and I'm going to be able to get out no problem. Just like really in tune.

• 8:31Jordi Hays?

  He's almost like, it's like he's farming.

• 8:32John Coogan?

  Yep. Yep. Reading the country. This involves, uh, he says, uh, there's a central principle of fire management. Read the country. This involves examining the distribution of trees, bushes and natural fire breaks, the thickness of undergrowth and the amount of moisture in the ground to ascertain whether a fire will remain cool and under control. Every landscape is different. Each burn requires a fresh analysis. So this dude just goes out there and, uh, and, and burns and burn stuff. Uh, it's pretty, pretty wild. But we should move on to the insurance industry, which is, uh, as you mentioned, uh, likely bankrupt in the sense of the state backed one. And there's a bunch of interesting, um, versus that. I think we should do the

• 9:14John Coogan?

  history of, uh, State Farm and some, some of the, some of the insurance agencies, um, as well as talk about.

• 9:20Jordi Hays?

  Yeah, we'll start with some of the history and then. Yeah, let's start with the history and then we'll go into kind of what's happening on the ground now.

• 9:27John Coogan?

  So I found this, uh, short transcript from Warren Buffett at the.

• 9:33Jordi Hays?

  Camry Driver?

• 9:34John Coogan?

  Yeah, Camry Driver. Um, uh, at a shareholders meeting and he says, the history of insurance is quite interesting. It's not studied at business schools, but it should be because the great insurance companies of the early 1900s, Aetna, Hartford, Travelers, they had agency forces nationwide and primarily wrote businesses back then, wrote property business back then. So property insurance. They wrote a lot of fire insurance. Of course, the automobile emerged in the early 1900s, so their focus was on property insurance. They had huge agency forces throughout the United States. Property insurance agents represented these big companies across the country and they had plenty of capital. If you look at the business in 1997, well, over 20%,

• 10:14John Coogan?

  probably close to 25% of personal auto and homeowners insurance was written by State Farm. It began, I believe in the 1920s with a fellow in Bloomington, Illinois, who we'll discuss, uh, George, uh, McCurl.

• 10:29John Coogan?

  Yeah, Bloomington, Illinois. It had no agency force initially and started as a mutual company with no stock options or capital that could make someone a billionaire if they built the business. So this company began without the usual capitalist incentives that were taught, that we are taught are essential for growth, and in a huge industry, it became a dominant player. So it was questions like, how did this happen?

• 10:51Jordi Hays?

  We'll talk about this later, but there's an emerging, emerging company in the home insurance space called Kin that has this structure set up where the premiums are paid into this sort of nonprofit group and like structure, to put it sort of plainly, and then that nonprofit pays a licensing fee to the technology company, but like really they're, so it's trying to align incentives. So the history of insurance is like finding these, it's finance, it's finance. So it's finding these like weird creative structures in order to deliver the end thing, which is protection against, you know, catastrophic risk.

• 11:28John Coogan?

  I mean, he'll go into more of this, but it's a great question. It's like, how did this company get so big and dominant without the usual capitalist incentives? But what's funny is like, you already know this is just gonna like tie socialists in knots because they like, there's already so much misinformation about like, oh, like fidelity owns every company, it's the most powerful company in the world, and it's like, BlackRock, same thing.

• 11:51Jordi Hays?

  They own Burning Man.

• 11:52John Coogan?

  And, and this is one of those things where it's like, well, you know, like State Farm is owned by the policyholders.

• 12:02Jordi Hays?

  Yeah.

• 12:03John Coogan?

  Like it's a mutual company. So like, it's gonna be much, it should be much harder to make the like evil capitalist argument, but they're definitely not gonna like look that deep into this, but we will. We'll put it, we'll keep them in the truth zone as much as we can. So State Farm has more than twice the market share of Allstate, the second player. It became the dominant company against deeply entrenched competitors with strong distribution systems and ample capital. Incidentally, on the Fortune 500 list, State Farm has the third largest net worth of any company in the United States. This was a couple of years ago. All from Bloomington, Illinois, started by someone who had no money in it. How does that happen? That's a subject worth studying in business schools. Darwin once said, "He wrote down any evidence that conflicted with his convictions within

• 12:44John Coogan?

  30 minutes, because the mind quickly rejects contrary evidence to cherished beliefs." Isn't that cool? I think that's a great, I think that's a great like just thing to do. Like when you find evidence that violates your, your, your strongly held beliefs, you just have to write it down. Because otherwise you're, you'll just be, oh, I can't even deal with that data point because it violates my, my current worldview. I love that one. And so he says, uh, this is Warren Buffett going on. There are some long held beliefs in business schools that could be challenged by studying how a company becomes the third largest in net worth with no apparent advantage at the start. Another company in Texas, USAA, the United Services Automobile Association.

• 13:28Jordi Hays?

  By the way, with net, by net worth, do they mean?

• 13:30John Coogan?

  He means market cap.

• 13:31Jordi Hays?

  Market cap.

• 13:31John Coogan?

  Yeah, he means market cap. He's just using net worth, which is also kind of badass.

• 13:37John Coogan?

  Be like, they're, they're the same. Like corporations are people.

• 13:40Jordi Hays?

  Corporations are people. Great people.

• 13:42John Coogan?

  So USSA, USAA has been enormously successful with billions in net worth again, and highly satisfied policyholders. It has the highest renewal ratio in the country. Nobody studies that, to my knowledge. GEICO's founders, Leo Goodwin and his wife, left USAA in 1936 and started GEICO with almost no capital. Now we have about 2.7% of the auto market and will probably write 3.5 billion in voluntary auto insurance this year. Catching State Farm will be very difficult, so I won't predict that. However, I do predict we'll gain substantial market share over the next 10 years, including this year. We have a good mousetrap. And then this is the best part of this. He basically goes into an ad read for his company GEICO. Listen to this. He says, I mentioned.

• 14:25Jordi Hays?

  Where was this again?

• 14:26John Coogan?

  This was at the Berkshire shareholder.

• 14:27Jordi Hays?

  Meeting.

• 14:28John Coogan?

  Yeah, the main meeting. So he's talking about.

• 14:29Jordi Hays?

  All the people, all the people that are a hundred. So this is, this is an example. This is a founders. You can never over promote your business and, and investors.

• 14:37John Coogan?

  Yep.

• 14:38Jordi Hays?

  You can never over promote your bags.

• 14:39John Coogan?

  Never, never.

• 14:40Jordi Hays?

  So like, he's literally at the Berkshire Hathaway shareholder meeting.

• 14:43John Coogan?

  You have to be a shareholder to be in that room.

• 14:45Jordi Hays?

  To go there and he's still.

• 14:46John Coogan?

  Yeah.

• 14:47Jordi Hays?

  I want to take a quick second to talk about GEICO.

• 14:49John Coogan?

  Basically, he says, I mentioned in the report.

• 14:51Jordi Hays?

  Running a podcast.

• 14:52John Coogan?

  That 40% of you would save money by insuring with us. Literally, that's what he says. Not 100% or 80% because there are certain areas or professions where someone else can offer a lower price. But across the country and for all classes of drivers will often have the lowest price. We can do that because we have low costs and those costs are getting even lower. We have a virtuous cycle feeding on itself, so GEICO will grow significantly.

• 15:17John Coogan?

  Still, State Farm is very tough. I'm not going to predict catching State Farm or Allstate, but we'll catch somebody. Charlie, you want to add anything?

• 15:24Jordi Hays?

  That's great.

• 15:24John Coogan?

  It's just like 40% of you guys could save money by searching for GEICO.

• 15:27Jordi Hays?

  That reminds me when we did a Ramp ad during our talk at Hereticcon.

• 15:30John Coogan?

  Yeah, exactly.

• 15:31Jordi Hays?

  It was a great ad.

• 15:31John Coogan?

  Yeah, yeah. Yeah, I mean, honestly, advertising to the targeted audience is...

• 15:37Jordi Hays?

  Anytime you have a captive audience, it's your duty to promote.

• 15:41John Coogan?

  You got to. You got to run an ad. And so Charlie says, "I love your example of State Farm. The idea of picking an extreme case and asking, 'What in the world is going on here is the path to wisdom? It's too bad many mutual companies are trying to demutualize spurred on by consultants instead of looking at State Farm. Of course, not everyone can be State Farm, but that place embedded fundamental values into its operations, the way it selected its personnel, the way it selected and discarded agents. It requires enormous discipline. Wouldn't you agree?" Warren says, "Yeah, somebody obviously did something very right." Charlie goes back to say, "Exactly, but I don't see anyone explaining what that something was. Maybe they don't want to because

• 16:21John Coogan?

  it didn't fit the conventional pattern. When a company like State Farm emerges, you should try to understand it. When a company like GEICO emerges, you should do the same. Back in 1948, I believe, 2/3 of GEICO was for sale because the original backers who came from USAA had died. So they'd put the money in because the GEICO founders came from USAA. They put in so much money that they owned 2/3 of the company."

• 16:47Jordi Hays?

  Crazy.

• 16:47John Coogan?

  And they were like, "Let's sell it." So they were selling that stock, but nobody wanted it. And apparently State Farm had the opportunity to buy 2/3 of GEICO for like a million dollars.

• 16:59Jordi Hays?

  Crazy.

• 16:59John Coogan?

  They didn't buy it. And so Ben Graham bought it. Ben Graham, of course, Warren Buffett's mentor, or yeah, wrote the father of investing, value investing. He spent six months trying to sell it.

• 17:14Jordi Hays?

  Wait, so like what Cenra is to podcasting?

• 17:15John Coogan?

  Exactly.

• 17:16Jordi Hays?

  Ben Graham is...

• 17:17John Coogan?

  Yeah, yeah. We're kind of like the Charlie and Warren of podcasting. He's the Ben Graham. Exactly. Let's canonize that immediately. So he spent six months trying to sell it to the major insurance companies. They all passed, even though they could see GEICO offering a much cheaper product on a small scale and making money with it. So they had this like, GEICO had this early traction, this product market fit, basically. Like they were doing something that was cheaper and better.

• 17:41Jordi Hays?

  GEICO...

• 17:42John Coogan?

  And they scaled up.

• 17:42Jordi Hays?

  I still use GEICO for auto.

• 17:45John Coogan?

  Oh, really?

• 17:45Jordi Hays?

  And... Every time I go to agents to get alternative quotes, I'm like, do you have, like, did you add a comma here? Oftentimes like four, like five times more expensive. Is this a joke?

• 17:59John Coogan?

  They could have bought the entire company for 1.2 million. Instead, they stuck to their old distribution systems and got beaten up by the, over the years, by these new ideas. You have to look hard at what's really happening. And this is a great ending. He says, "As Yogi Berra said, you can observe a lot just by looking." I love that. So, the question is, who started State Farm? And how did he build such a great business and such a massive business without this economic incentive? And I have a theory, which I will tell you. So, this is a, this is a great one. Maybe we'll start with, we'll go through the Wikipedia and we'll go through some of the, some of the,

• 18:43John Coogan?

  the details on George, I gotta pronounce this, McCurl, McCurl. George McCurl.

• 18:52Jordi Hays?

  McCurl.

• 18:53John Coogan?

  McCurl. I think it's McCurl. We'll, we'll work on that, but we'll just call him George.

• 18:57Jordi Hays?

  We need a-

• 18:58John Coogan?

  He's a friend.

• 18:59Jordi Hays?

  If somebody wants to build a rapper that just-

• 19:03John Coogan?

  Helps us-

• 19:04Jordi Hays?

  Helps us pronounce exotic names, we would use it all day long.

• 19:07John Coogan?

  Okay, so, I'm gonna call him George, founder of State Farm. George was a second generation farmer in central Illinois, whose family migrated to the United States from Germany. As an early owner of automobiles, he became concerned with high cost of auto insurance charged by all stock insurance companies at the time. And so, this is from an amazing website. It is the Insurance Hall of Fame.

• 19:32Jordi Hays?

  Which everyone listening to this should aspire to-

• 19:35John Coogan?

  If you're in the insurance business, you gotta go for the Hall of Fame.

• 19:38Jordi Hays?

  Even if you're not, I mean, I mean, you have a better chance of getting into this Hall of Fame than, than most.

• 19:43John Coogan?

  Yeah.

• 19:44Jordi Hays?

  I would imagine.

• 19:45John Coogan?

  And there's a, there's a great thing about like, why he started this. So he was upset, he was upset with the high cost of auto insurance. And what he realized was, he was, he was a rural guy. He was out in central Illinois. And what he realized was that the, the insurance rates were being set by companies that were based in urban settings. So it was like a Manhattan company. And they were like, well, in Manhattan, you get in car accidents all the time.

• 20:10Jordi Hays?

  Yeah.

• 20:10John Coogan?

  So this is the rate we need to charge. And he was like, you're screwing my boys out in the farm land.

• 20:15Jordi Hays?

  We're subsidizing your crazy.

• 20:18John Coogan?

  Exactly. And so, and I also, I found something else. I don't know where it is, but it was like, he, he was obsessed with. Yeah. Okay. So after returning to Illinois, he sold tractors and discovered that he had a skill for selling to farmers, believing that city insurance companies were rooking farmers by, with high premiums based upon city driving accident rates. He became obsessed with the idea of starting his own insurance company, an honest insurance company was the phrase he used.

• 20:49Jordi Hays?

  Great line.

• 20:50John Coogan?

  And, and they talk about, it was something I read where he was talking about his time as a, a farmer. And he was just like obsessed over like the yield of like his beans and stuff. And everything about this just reads.

• 21:02Jordi Hays?

  Wait.

• 21:02John Coogan?

  Giga autist. That's my theory.

• 21:04Jordi Hays?

  Every one of our listeners, all the brothers are obsessed with maximizing the yield on their beans.

• 21:09John Coogan?

  Exactly.

• 21:10Jordi Hays?

  The beans are just different at different times.

• 21:12John Coogan?

  Yes. He was just, he was clearly, clearly, clearly just grinder, grinder. And, and it's amazing. So he starts, so he starts this company in the spring of 1921. Tazewell County Farm Bureau organized a township mutual insurance company, which was the idea George used. He'd been considering a mutual insurance company, which is owned by those who are insured through a membership. The Tazewell company was set up to insure property, including automobiles. He attended a meeting of the Federation of Mutual Fire Insurance Companies in the summer of 2019, 21 in St. Louis. He spoke with the president and those discussions helped crystallize his idea of starting an honest insurance company.

• 21:54John Coogan?

  Eventually his idea started to take shape and he opened his first office in late 1921 in Bloomington. In 22, he developed a prospectus and presented it to the Illinois State Association of Mutual Insurance Companies. And his plan called for his company to sell automobile insurance. The association enthusiastically endorsed the plan. He proceeded to get the state license he needed to operate on his 45th birthday. State Farm Mutual Automobile Insurance Company was in business in 1922. So yeah, deeper into his career, still made a major play, made it work.

• 22:30Jordi Hays?

  Common, very common story.

• 22:33John Coogan?

  He attempted to adopt programs that gave financial strength to his growing company while providing unique benefits to policyholders beyond what was offered at the time. For example, he adopted a strict no drinking and driving provision to reduce accidents. Cause it was legal back then.

• 22:51John Coogan?

  Isn't that amazing? He's like, this is innovation. If we can just get our members to stop boozing at the wheel.

• 22:57Jordi Hays?

  No, he sends a PR news wire. Unfortunately, I have to announce that we will not no longer be allowing road sodas for our policyholders.

• 23:09John Coogan?

  So funny, cause like now, you know, there's like those like chips that you can put in the car. It goes in the ODB two port and like it tracks your driving. And if you're like braking really heavily and like raising rates or like, or like, you know, all sorts of things. Oh, it's a red sports car.

• 23:21Jordi Hays?

  And there's parents, yeah, parents attach that stuff.

• 23:23John Coogan?

  Yeah, yeah, all sorts of stuff. And like, check your phone, there's metro mile where if you drive less, you pay less insurance. There's like all these different schemes that like are trying to squeeze like the last 5% of productivity out of the auto insurance industry. And he's just like, what if we didn't drink and drive?

• 23:37Jordi Hays?

  Metro Mile is.

• 23:39John Coogan?

  Dave Friedberg and Chamath took it.

• 23:41Jordi Hays?

  Oh, yeah. They're, they're, they're Warren. He said it was their GEICO.

• 23:46John Coogan?

  Yeah.

• 23:46Jordi Hays?

  That's what he described as.

• 23:47John Coogan?

  Yeah.

• 23:47Jordi Hays?

  That's cool. Wait, Friedberg was it?

• 23:49John Coogan?

  Yeah, Friedberg founded it. He co-founded the company. Yeah.

• 23:52Jordi Hays?

  That's.

• 23:53John Coogan?

  And Chamath's backed it.

• 23:54Jordi Hays?

  Yeah.

• 23:55John Coogan?

  And cool idea. I don't, I think the stock's way down, but I don't know. It might've popped. All these specs are coming back, baby.

• 24:01Jordi Hays?

  Specs are back.

• 24:02John Coogan?

  A lot of them, a lot of them have gone up like 5X since the floor.

• 24:05Jordi Hays?

  I bet you Friedberg, Friedberg is the founder, there's probably like some fundamental, like good quality thing in there.

• 24:14John Coogan?

  Yeah.

• 24:15Jordi Hays?

  That's cool.

• 24:16John Coogan?

  Yeah.

• 24:18John Coogan?

  So he also-

• 24:18Jordi Hays?

  It's actually interesting. I bet you there will be a bunch, not a bunch, but at least a handful of Chamath's backs where if you buy them now, they'll be like a 50 bagger.

• 24:28John Coogan?

  Yeah.

• 24:29Jordi Hays?

  And then Chamath in however long will be like, see like another like-

• 24:33John Coogan?

  Yeah. I mean, also a lot of these like they became such memes, like the whole meme of like, oh, everything Chamath's backed is bad. It's like a lot of these got just oversold because I mean, I had a buddy who spacked his company. I think it was four billion is the default spec. It went down to under a hundred million dollars. They had 200 million dollars in cash on the balance sheet.

• 24:51Jordi Hays?

  Yeah.

• 24:52John Coogan?

  It's like, okay, at that point, like the book value should be higher than that.

• 24:54Jordi Hays?

  Yeah, same way. So the, um, um, close friends, business partners, Brian and Drava-

• 25:01John Coogan?

  Yeah.

• 25:01Jordi Hays?

  At a, at a conference, they had latch which Chamath's backed. And then, um, uh, at one point it was trading for less than their balance sheet.

• 25:11John Coogan?

  Yeah.

• 25:11Jordi Hays?

  You know, so.

• 25:13John Coogan?

  But there was like no interest. Everyone was, everyone was doomer on it. Um, he also instituted the first installment payment program for premiums. This allowed farmers to pay their premiums when they received payments for crops. So he's like financializing things, figuring out. It's like buy now, pay later.

• 25:30Jordi Hays?

  This guy is the epitome of, of, of excellent capitalism.

• 25:34John Coogan?

  Yep.

• 25:35Jordi Hays?

  Built a super massive impactful company, but clearly at every point was trying to find these win, win, wins for-

• 25:41John Coogan?

  Totally.

• 25:41Jordi Hays?

  The company, the team, the, the policy holders, the customers.

• 25:45John Coogan?

  Yep.

• 25:46Jordi Hays?

  And ultimately people out on the roads, right? With that auto policy.

• 25:51John Coogan?

  There's a, there's a good quote in here. So eventually his company became the largest property and casualty insurer in the United States and one of the 20 largest corporations in the Fortune 500. What a badass. Let me pull this up, George. So he had this great quote. They asked him like, you know, what is your, uh, what is your secret to success? And he says,

• 26:18Jordi Hays?

  Which one?

• 26:19John Coogan?

  Hard work is important, but he put it this way. He says, "A man has to live and sleep with his business if he wants to make a go of it. You have to take it home with you at night so you can lie there in the darkness and figure out what you can do to improve it."

• 26:36Jordi Hays?

  That's amazing.

• 26:37John Coogan?

  Isn't that so true?

• 26:38Jordi Hays?

  It's so real.

• 26:39John Coogan?

  It's so real.

• 26:40Jordi Hays?

  Imagine, imagine having to build companies pre-cell phone.

• 26:44John Coogan?

  Yeah.

• 26:45Jordi Hays?

  Just think about af- like after 6:00 PM every night, how many messages we send back and forth.

• 26:52John Coogan?

  Yeah.

• 26:52Jordi Hays?

  On a given night, it's probably each like 100.

• 26:55John Coogan?

  Yeah. So from year to year, we are learning that service carries with it its own reward. And to the extent and manner in which our service is dispensed, compensation in every form will flow. And so I'm sure he wound up, you know, fabulously wealthy, just through a little bit of a different, different path than usual. Also interesting is he, there's like this trend that Charlie Munger mentioned, which was like demutualization, like a lot of these mutual companies are, are demutualized, demutularizing? Demutular, demutularizing? Like breaking and just becoming like default for profits.

• 27:36John Coogan?

  And it's interesting because everyone's looking at the OpenAI for-profit transition is like, this has never been done, it's so crazy. And it's like, I don't know, like, there's a lot of companies that have been through this. It's not that, it's not that unprecedented. You start a company one way and then you switch it up.

• 27:52Jordi Hays?

  It's hard to do it with a guy with the biggest megaphone in the world. He doesn't want you to do it.

• 27:56John Coogan?

  It's a little rough when you're getting the, the crying emoji under every time you pose. It's gotta be a little rough.

• 28:03Jordi Hays?

  Mugged, mugged.

• 28:06John Coogan?

  But yeah, then there's a bunch of other stuff about, about, about State Farm in here. You know, now they employ 70,000 employees, they have 19,000 agents, offices all over the place.

• 28:20Jordi Hays?

  I'll get into it later, why the agent model ends up being, makes, makes insurance pretty hard.

• 28:25John Coogan?

  Yeah. So 80 billion in revenue, 6 billion in net income, total assets 300 billion, and total equity 100 billion. But that, that total assets is, is, is important because when something like the Palisades fire happens.

• 28:43Jordi Hays?

  You need to be able to absorb that.

• 28:44John Coogan?

  Yeah, I mean, there was a lot of news about State Farm, like, stopping to, like, canceling policies, basically, in the lead up to this. But, you know, I, I think, what did Warren Buffett say? They have like... Forty percent of the market or something like that, State Farm, maybe, maybe a little bit less.

• 29:00Jordi Hays?

  And so. State Farm was especially, I mean, the, the challenge was that they had 1,600 policyholders in the Palisades.

• 29:08John Coogan?

  Oh, it's lots of concentration there.

• 29:10Jordi Hays?

  So huge concentration there. I mean, I doubt it was even concentrated for them. It's more so that that 1,600 homes is billions of dollars of value.

• 29:19John Coogan?

  Yeah. And so I, I, I wonder like, you know, how the.

• 29:24Jordi Hays?

  Even I, I wonder who I really, so the succession, the house in succession that Kendall Roy has posted up in when he's going through his summer arc at one point.

• 29:35John Coogan?

  I haven't seen that season. I just watched the first season, I think.

• 29:37Jordi Hays?

  Uh, weird, but, uh, okay.

• 29:41Jordi Hays?

  But anyways.

• 29:42John Coogan?

  But I'm familiar with the house because the Teal fellow bought it.

• 29:44Jordi Hays?

  Hundred and twenty-five million dollar home.

• 29:45John Coogan?

  Wow.

• 29:47Jordi Hays?

  Obviously takes a special insurance relationship to insure something like that, but burned to the ground.

• 29:52John Coogan?

  Wow.

• 29:53Jordi Hays?

  From a guy who, Teal fellow who specked his company.

• 29:56John Coogan?

  Luminar, Austin Russell.

• 30:00John Coogan?

  Anyway, is there more stuff that we should move on to there? Or should we talk about how insurance underwriting works and how these natural disasters are categorized?

• 30:09Jordi Hays?

  Start there and then I'll, I'll get into some of the more.

• 30:12John Coogan?

  Yeah. So I, I've been doing more of a deep dive on this. I, I listened to an Odd Lots episode where they talk to the, uh, someone who works, who maintains a database of catastrophes and hazards for the government. So this is Melanie Gall. She's a co-director of the Center for Emergency Management and Homeland Security at Arizona State University. And I don't think about like wildfires as homeland security, but it makes so much sense. Uh, and she manages a, uh, a database called Sheldon, the special, the spatial hazard events and losses database. So she's a, uh, she's not economist or a policymaker. She's a geographer and she wants to just.

• 30:57John Coogan?

  Collect as much field data with GPS after a massive flood event, put it all into these databases, and then that is used for underwriting and actually calculating like what is the right level of investment. And so Tracy Alloway on Odd Lots says, I read that the National Climatic Data Center estimates Hurricane Katrina losses at around 125 billion, while Sheldon says around 80 billion. How do we end up with such big discrepancies? And I'm sure we're going to see this with the Palisades fire. We already are.

• 31:28Jordi Hays?

  There's numbers out there for Katrina that are around 200.

• 31:31John Coogan?

  Yeah.

• 31:32Jordi Hays?

  So who knows?

• 31:33John Coogan?

  And so Melanie says, it can matter when a community needs to justify a mitigation investment and must do a cost benefit analysis. Different entities measure losses differently, whether it's direct versus indirect, or insured versus uninsured. NOAA's billion-dollar events estimates often exceed ours because they rely heavily on insured losses.

• 31:53Jordi Hays?

  That's right.

• 31:54John Coogan?

  We only look at direct losses.

• 31:55Jordi Hays?

  In the Palisades, I think there's 20 billion of insured losses, and then there's a bunch of other losses that just weren't covered.

• 32:02John Coogan?

  Yep. And so this particular database, Sheldon, is a more conservative approach. If we see competing estimates, we use the lower one to avoid overestimation, which can further understate the real burden. And that's just kind of like by design of this particular database. Obviously, all the insurers know about the different databases and can adjust accordingly. And so Joe Weisenthal asks, like, the big question is, are natural disaster costs going up? Is it really getting worse, or is there just more media attention? And Melanie says, yes, it is getting worse. The risk is going up. We see more frequent and more severe events, but it's complicated. Are losses higher because there are more events, or because more people and property are concentrated in risky areas? Maybe society

• 32:45John Coogan?

  doesn't invest enough in mitigation, or our infrastructure isn't resilient enough? It could also be that we have more socially vulnerable populations who struggle to recover. So yeah, if you go and build like the most insane billion dollar mansion out of, you know, birch wood in the most fire prone area, like that's kind of a choice on us and it's not necessarily like climate change that's causing that higher loss. It's the choice that we made to build into the wildfire area. And this is a lot of what we're, what's happening as Los Angeles expands is that people move deeper and deeper into the woods and into the mountains and all of that is much more risky.

• 33:24Jordi Hays?

  Well, to be clear, some of the nicest areas of LA are in these canyons and up on hills. And it's the places that are some of the most desirable places are, you know, DHH's like Malibu lookout, right?

• 33:37John Coogan?

  Yeah, yeah. So Tracy asks, if a hurricane hits Florida, how does a typical homeowner expect to be reimbursed? My understanding is that there are many layers, private insurers, federal support and reinsurers behind them. And Melanie says it's complex and varies by state. In Florida, you'd usually have homeowner's insurance, flood insurance from the state, from the federal government, though purchased through local agents. So you actually go to your local agent and they act like a normal insurance agent, but they're just selling you a federally backed policy. And sometimes you might have separate wind insurance in Florida. Different policies might kick in depending on whether damage is classified as wind or flood.

• 34:18John Coogan?

  After Katrina, after Katrina, some neighbors saw their wind policies pay out while others were told it was flood damage, which wasn't covered. It's not straightforward. And so the big question is why are insurance rates skyrocketing now? Homeowners, Florida homeowners insurance premiums rose 42%. Why are companies leaving instead of just charging more? So insurance companies explain that they face higher risk wildfires in California, hurricanes in Florida. Plus higher building costs and higher premiums for their reinsurance.

• 34:47Jordi Hays?

  Yeah.

• 34:48John Coogan?

  So there's basically two big reinsurance companies, Swiss Re and I forget the other one, but they, they wind up insuring.

• 34:55Jordi Hays?

  And to, and to, to, to define it, reinsurance is insurance that insurance companies have to get.

• 35:01John Coogan?

  Yeah.

• 35:02Jordi Hays?

  So you got insurance, uh, what's that exhibit, you know, meme that, that's like a 20 year old meme at this point. It's like, I got insurance for my insurance, for my insurance.

• 35:12John Coogan?

  Basically.

• 35:13Jordi Hays?

  And so what's, what's interesting about California is that legally the insurance companies were never allowed to pass on the reassurance, reinsurance costs to the end customer.

• 35:23John Coogan?

  Yep.

• 35:24Jordi Hays?

  And so they, um, and, and again, like, you know, nobody really likes their insurance company. Every time they have to interact with an insurance company, the NPS score actually goes down because you always are going to be like somewhat disappointed. You just had this loss.

• 35:38John Coogan?

  Yep.

• 35:39Jordi Hays?

  And then you're dealing with this company that, that's trying to, there's sort of this misaligned incentive and that the insurance company basically wants to give you the lowest amount of money possible to not really piss you off as a customer, right?

• 35:52John Coogan?

  Yep.

• 35:52Jordi Hays?

  But the more money they give you as a payout.

• 35:54John Coogan?

  Yep.

• 35:54Jordi Hays?

  The, the less profits that they have, right? So it's this delicate balance and that means that pricing is, is the number one thing in insurance.

• 36:02John Coogan?

  Yeah.

• 36:02Jordi Hays?

  And if you misprice these things, it ends up, uh, but the thing in California that is, um, fascinating is everybody's like, oh, all the insurance are pulling out of California because of the wildfire risk. Uh, the reason that they're, they were actually pulling out is that there was structurally a number of laws in place. One, couldn't pass on reinsurance costs. Uh, there was, there was, um, measures to prevent like the rate at which you could increase the costs. And so if inflation over the last few years has been insane, so if you can't accelerate insurance to, to keep up for that, to keep up with that, like you're going to have a tough time. One thing that was interesting as of last year, um, I got

• 36:44Jordi Hays?

  this on Odd Lots as well. Policies in California were only $30 higher than the national average, home insurance policies. In Florida, they're $2,000 higher.

• 36:54John Coogan?

  Yeah.

• 36:54Jordi Hays?

  So Florida, the Florida market's like really. Much more efficient and sort of caught up and said, this is a high risk area. We need to price this this higher. But statistically, the the insurance providers in California have and and analysts have said that insurance providers are six, they they basically need to catch up like 60% behind on pricing. So everyone knew that California home insurance rates, even though they're already expensive, were too cheap. And the regulators had introduced something called Prop 23 a long, long time ago that

• 37:32Jordi Hays?

  that that did not allow the insurance providers to use catastrophe modeling and climate science to set premiums. So it's basically, so our California lawmakers were saying, hey, we just don't want you to charge a lot for insurance. So what we're going to do is say you can only set your insurance premiums based on how much you paid out over the last 20 years. And that works when the future looks exactly like the past. But in a scenario where maybe the government is under investing in wildfire mitigation, maybe we have, we've had more wind the last, you know, 20 year, you know, 10 years than we've had for the past 50 years on average, right?

• 38:15Jordi Hays?

  And so these insurance companies pulled out because the government literally was not allowing them to raise rates to a level that they were comfortable with, right? And going back to an earlier point, insurance is all about, you know, accurately pricing risk, right? And finding that middle ground so the insurance company can make money so that they deserve to exist. And the consumer can, and the consumer can, you know, get get sort of payouts as needed.

• 38:44John Coogan?

  Yeah, they've been kind of getting squeezed on both sides because it's not just that the risk of the houses getting destroyed or burned down is going up, but also because of inflation in both raw materials and labor, the actual cost to rebuild is increasing. And so if you just see the price of wood double, you need a high, like you, it's more expensive, your insurance should be more expensive.

• 39:06Jordi Hays?

  Yeah, and so one of the other interesting things is there's this dynamic in the insurance market where the The, the, there's a first mover disadvantage. So if you're the first home insurance provider to increase your rates, well, I don't care who insures my home as long as I believe they'll be able to pay out in a disaster or some type of adverse situation. And so if I'm with Allstate and then State Farm, you know, if I'm, if I'm with Allstate and whenever my term is coming up, I think they're annually typically, and they go, okay, we're raising you, you know, 20%, and then State Farm is saying, well, like, we'll give you this rate, you'll just switch because it doesn't, you don't really, it's not like top, it's not even like, like

• 39:49Jordi Hays?

  picking furniture in your house. Furniture you have to live with every single day. Insurance, you don't have to think about unless there's an issue. And so because the, the contracts are not, you know, very long, switching cost is low, and everybody works with agents, the agents will just be like, oh, you don't, you're not happy with this new price? I'll give you this new price. And so there's this weird dynamic where nobody really wants to raise rates, but you have to. And so what that led to is saying, hey, if we raise rates the way that we need to, we're gonna lose, we won legally, can't, if we could, we'd lose a lot of our customers. So we're just gonna pull out entirely. And for State Farm, it was obviously the right decision. And now we're, we're in the situation, part of the crisis is that there's just this, um, there's not a, there's not enough people insuring

• 40:34Jordi Hays?

  homes in this area of Southern California, right? When I ran this process last year, I was only able to get two. The Fair Plan, which was a state provide, state, uh, California State Program that's a insurer of last resort, and some random other, you know, group that I ended up going with.

• 40:52John Coogan?

  Yep.

• 40:52Jordi Hays?

  And, um, and so I think it was 20% of the, um, the worst areas affected by the fires in the last week, 20% of those homes were on the Fair Plan. And so that now needs to be figured out. And it's, again, it's state sponsored and theoretically state backstopped.

• 41:14John Coogan?

  Yeah.

• 41:14Jordi Hays?

  But then it's sort of provided by these private companies, but. So we're going to see how that plays out.

• 41:20John Coogan?

  Yeah, there's an interesting discussion in here about how can like, once the insurers actually pull out and say, it's just not economical for us to participate in this market. How can states get insurers back? And there's this interesting example, because you don't think of, you know, California falling behind Louisiana, but Louisiana gets cited often for good policy choices. Here's the example, the state helps cover, cover certain levels of risk and they have an insurer of last resort was of last resort called Citizens. Unlike Florida, Louisiana's citizens must offer premiums slightly higher than the, than the private market. So it doesn't undercut private insurers.

• 41:59Jordi Hays?

  Yeah, because it's this weird dynamic where you're like, wait, is the state competing with us?

• 42:03John Coogan?

  Exactly.

• 42:03Jordi Hays?

  The state doesn't want to compete because they don't want to really be in insurance.

• 42:06John Coogan?

  Yep.

• 42:06Jordi Hays?

  And so here's the crazy thing. So the California Insurance Commissioner is this guy Ricardo Lara. And his task, his primary task has been, how do we win back home insurance? You know, how do we providers to California? And so he actually released a new regulation in December of 2024. You can find all of these wires that were going out in mid-December and literally on December 31st, about a week before the fire started. And he was creating, you know, this new regulation would allow insurance providers to use catastrophe modeling and climate science to set premium prices.

• 42:50Jordi Hays?

  And the timing of this is just devastating because, you know, he, he basically, you know, he probably, that probably would have needed to happen like a year ago for the changes to go into effect for people to get proper insurance. But there was basically a weak gap between that new regulation and the fire sitting. So just not enough time to respond.

• 43:10John Coogan?

  Hmm.

• 43:11Jordi Hays?

  I have a bit more on how.

• 43:14John Coogan?

  Yeah, keep going.

• 43:17Jordi Hays?

  So, you know, one thing, the other pressure on insurance providers over the last, over the last few years and, and basically, uh, they were talking about this on Odd Lots, but, but basically, uh, insurance is finance, but it's like the least sexy part of finance, right? Like, nobody's like, I want to go into-

• 43:39John Coogan?

  Finance, yeah.

• 43:40Jordi Hays?

  I, everybody's like, I want to be a-

• 43:42John Coogan?

  No thanks Goldman Sachs and investment banking.

• 43:44Jordi Hays?

  Size lord, I'd rather sell, you know, insurance, or I'd rather work for one of these big, um, insurance brokers or, or, you know, um, providers. And, uh, one of the challenges from the last few years is, uh, as we, there's been two factors. So, um, there's been a capital supply shock, which is interest rates have gone up. And so these mutuals and, uh, insurance providers, they, they carry, they hold a lot of bonds on their balance sheet.

• 44:12John Coogan?

  Yep.

• 44:12Jordi Hays?

  And so as interest rates have gone up, the value of those bonds have gone down. Second is, uh, anybody that is financing these insurance companies is effectively getting paid for taking on climate risk.

• 44:26John Coogan?

  Yep.

• 44:26Jordi Hays?

  Which is appealing when rates are near zero or 2% or whatever. But then, uh, because, because climate risk is not associated with, um, you know, it's, it's disconnected from the Fed. But as rates have shot up, everybody's like, well, if my risk-free rate is five and a half percent, why do I want to take on all this climate risk in a time when climate catastrophes have been accelerating? When, uh, it just starts to not, um, make sense. And so people will just look for other places to, uh, park their cash.

• 45:00John Coogan?

  Yeah. I thought this other piece in The New Yorker, breaking down Hurricane Milton, was pretty instructive in terms of what we could see going forward. So for those who don't remember, Milton came in the in the wake of Helene. This was back in October of 2024. We saw some crazy wifi money kids setting up Starlinks to continue sports betting.

• 45:24Jordi Hays?

  No, not even just sports betting, selling courses on how to sports bet.

• 45:28John Coogan?

  Courses.

• 45:28Jordi Hays?

  Using the hurricane to sell courses on sports betting.

• 45:31John Coogan?

  Yeah, he's like, I don't have power. I don't have internet.

• 45:34Jordi Hays?

  Hustler.

• 45:34John Coogan?

  But I'm I'm committed to the hustle. But after this, the disaster in Florida, Joe Biden toured the damage. And the unofficial death toll rose to more than 20 and more than a million Floridians were reported to be without power impacted by the storm, although major was less severe than some forecasters had feared. But with Milton coming in the wake of Hurricane Helene, which has devastated parts of Florida, North Carolina and other states, the 2024 hurricane season represents a threshold crossing of sorts. It became this massive political issue. Trump said Kamala spent all her FEMA money, billions of dollars, on housing for illegal immigrants and.

• 46:12Jordi Hays?

  Yeah, that's another crazy stat, by the way. Yeah, I've been asking people. So so we spent $3 billion on wildfire prevention last year.

• 46:20John Coogan?

  Yep.

• 46:21Jordi Hays?

  How much in California? How much do you think we spent on benefits for illegal immigrants?

• 46:25John Coogan?

  Oh, yeah, it's like 50, right?

• 46:26Jordi Hays?

  30.

• 46:27John Coogan?

  30.

• 46:28Jordi Hays?

  So we spent we spent 10 times as much on benefits for illegal immigrants as we spent on protecting, you know, citizens from and taxpayers from wildfires. So yeah, seems like that that could shift.

• 46:41John Coogan?

  And hilariously, in The New Yorker, they reference Marjorie Taylor Greene saying, yes, they can control the weather. And this became, I think she was quote tweeting Augustus. I think this was like a whole Augustus arc. Uh, because there was a there was a whole like this.

• 46:57Jordi Hays?

  It's pretty it's pretty cool that anytime somebody talks about the weather, they have to quote tweet Augustus now. He basically runs the weather.

• 47:03John Coogan?

  Yeah, yeah, anytime it rains or doesn't rain, you have to talk to Augustus. But it became a massive culture war issue. A lot of Republicans were saying like the Democrats. Planned the hurricane, but then afterwards it was all about the disaster relief fund. And although, you know, there's like a question about like the FEMA money technically is a different account than the housing for illegal immigrants money, but the disaster fund was empty. And so Congress needed to replenish it and, and the, the government was like out of session. And so House Speaker Mike Johnson had to bring the Congress back into session.

• 47:47John Coogan?

  And, and that was kind of like slowing down the topping up of that fund. But again, it's just like, there's just more and more pots of money that just go in. And once they go in, how much of it actually goes to helping people?

• 47:58Jordi Hays?

  Yeah.

• 47:59John Coogan?

  In the degraded political environment, making sure that FEMA was adequate, has adequate funding and that effective policies are in place is far from a trivial matter. Definitely agree with that. And there's some interesting context on what's happening in the insurance market broadly, as major insurers pull back from areas of high risk of any climate disaster in states like Florida, California, and Colorado, finding affordable home insurance policies is becoming more difficult in many other areas too. According to the Consumer Federation of America, from 2017 to 2022, just five years, average premiums rose about 40% faster than inflation, not even inflation adjusted, still 40%. And government figures show they have

• 48:42John Coogan?

  continued to rise rapidly since then, with effects of climate change intensifying, the risks of an insurance problems associated with them are no longer just coastal, they affect everyone.

• 48:52Jordi Hays?

  Yeah, part of it, there was, I saw something about how in Tampa, insurance rates were steadily going up like 10% a year and everybody's freaking out, right? Cause they're like, what are these insurance companies are gouging us? Simultaneously, property values were also doing. Almost exactly the same thing. So it's not like the whole, as I, my, you know, as a, as an entrepreneur, when I, anytime I get to know insurance businesses, obviously Warren Buffett and people have done very well in insurance. But when you study these businesses, you're not thinking to yourself, I'd like to get into insurance business, right?

• 49:31Jordi Hays?

  Cause like there's, there's been, there's been periods where an insurance company has done billions of dollars in profit. And then, you know, over a decade and then had it all nuked and, you know, in one event.

• 49:43John Coogan?

  There's some good quotes in here from CEOs of big insurance companies. John Neal, the CEO of Lloyds of London, says, you'll never find an insurer saying, I don't believe in climate change. The frequency and severity of weather related losses are exponential. And then Eric Anderson, the president of Aon, the world's largest reinsurance intermediary, said, just as the US economy was overexposed to mortgage risk in 2008, the economy today is overexposed to climate risk.

• 50:09Jordi Hays?

  Wow.

• 50:10John Coogan?

  And so it's one of those things where it's like, you can debate.

• 50:12Jordi Hays?

  Do you know when that was?

• 50:13John Coogan?

  This, uh, this was last year, so 2023.

• 50:17Jordi Hays?

  Crazy.

• 50:18John Coogan?

  Yeah, before this. And it's, yeah, it's interesting because like, there's a lot of debate over like, you know, is climate change real? How bad is it? Where did it come from? And then what do we do about it?

• 50:28Jordi Hays?

  And a lot of, and a lot of smart people will tell you, oh, it's real, but it's not. It's slower than everybody talks about because we have been told over decades. Oh, like the sea level is gonna take over.

• 50:42John Coogan?

  It's been very like AI doomer, like fast takeoff, like, you know, like Greta Thunberg.

• 50:46Jordi Hays?

  But yeah, it's.

• 50:47John Coogan?

  We're all dead in 20, in 2018.

• 50:49Jordi Hays?

  It's slow and then all at once.

• 50:51John Coogan?

  Yeah, yeah.

• 50:52Jordi Hays?

  You know, the LA fires.

• 50:53John Coogan?

  Exactly. And so, uh, uh, yeah, very, very, very interesting that like, like it kind of doesn't matter what you think about climate change or the, it's like, you can see it in the market. You can just look at the reinsurance market and understand that like, clearly the market is pricing significant climate change disasters. And so we have to do something about that, whether that's building or planning.

• 51:17Jordi Hays?

  The difference of you look at fires.

• 51:19John Coogan?

  Yeah.

• 51:20Jordi Hays?

  Fires and hurricanes get the most attention.

• 51:23John Coogan?

  Yep.

• 51:25Jordi Hays?

  Earthquakes are very damaging, but seem to be, you know, we've built buildings in a way now that seemingly are, you know, They're sturdier, there's less.

• 51:35John Coogan?

  Yep.

• 51:36Jordi Hays?

  Whatever. We're seemingly better prepared for them.

• 51:39John Coogan?

  Yeah.

• 51:39Jordi Hays?

  Knock on mahogany. But, uh, but hurricanes are not very preventable, right? They sort of emerge and they have a path and you hope you're not in the path and batten down the hatches, but it's going to be nasty kind of thing.

• 51:56John Coogan?

  Yeah.

• 51:57Jordi Hays?

  And then fires are sort of different dynamic and why this has become so politicized. We won't cover any of the political elements of the fires because we don't discuss politics. Even though I did think it was funny that, that Crooked Newsom went on Crooked Media during, he went on Pod Save America like during the fires to like try to set his record straight.

• 52:20Jordi Hays?

  But we don't discuss politics, but, um, it is, it is the, the reason that there's so much anger in LA right now is there's, there's a bunch of evidence that we could have done more, we could have spent more.

• 52:33John Coogan?

  Yeah.

• 52:33Jordi Hays?

  We could have, you know, the $17 million budget cut that turned into $200 billion damages. Seems a bit silly in hindsight. The fire chief had been on record saying we need 50 more stations in LA County.

• 52:45John Coogan?

  Yeah.

• 52:45Jordi Hays?

  Like all the stuff that's just super damning. Like we, you know, our, you know, government did not take this seriously enough. And there's again, these communist policies around price controls, people in Sacramento telling insurance companies, you can't, you can't use climate, like the same people that are saying like, you know, don't use water because of climate change or telling the insurance companies, you can't use climate science to set.

• 53:12John Coogan?

  Yeah.

• 53:13Jordi Hays?

  Pricing for your insurance.

• 53:15John Coogan?

  Yeah. It's become this classic battle of like, like if, if you say, if two people are talking about what to do about climate change, like the, the left wing might say, we need to curb consumption and the right wing might say we need to do nuclear and more forest fire prevention and.

• 53:31Jordi Hays?

  Yeah.

• 53:32John Coogan?

  Fortify our homes against hurricanes and be proactive. And, and then that gets shouted down. It's like, you don't believe in it.

• 53:39Jordi Hays?

  Yeah.

• 53:39John Coogan?

  And that's very problematic because it's like, there are plenty of things that we can do that actually result in more energy production and consumption, but still alleviate.

• 53:49Jordi Hays?

  Climate related disasters. Things for sure. Living in these areas is just going to continue to get more expensive.

• 53:55John Coogan?

  Yep.

• 53:56Jordi Hays?

  And one interesting anecdotal.

• 54:00Jordi Hays?

  That a family friend's house burned down in the Woolsey fires in 2018, which the Woolsey fires was the same fire that took took out my house before I owned it.

• 54:17Jordi Hays?

  So they did $5 billion worth of damages. And when after the dust settled, he went to to rebuild his house. And he couldn't get, even though he had this insurance payout, he couldn't get a construction loan to build a place because it was all the quotes he was getting were for 60K a year. And this is for like a tiny, like, three bedroom home in the mountains of Santa Monica. And he's like, well, I'm not going to pay 60 grand. He's, you know, in his 60s. He's like, I'm not going to pay 60 grand a year for the rest of my life to live in like a three bedroom house, not including property taxes, not including any other, like, it just financially wasn't. And so what he ended up doing is he has like, basically like, nice RVs set up on the property

• 55:02Jordi Hays?

  that he still like, uses, but he cannot build structures because he can't get the insurance to. Yep. And maybe that will change with some of this, just because, again, if we were doing, you know, it's, it's interesting. I have, I pitched brother Justin Mayer's on this idea back in Q4, saying, how can we apply drone technology for wildfire detection and, you know, real time mitigation? And then also around home defense, right? Because one of the challenges is when people, one, already insurance providers will give you a lower rate. If you have like fire sprinklers, they'll give you a lower rate. If you have like a newer roof that has, is more fire protected, they'll give you a lower rate. If your like, house is constructed in a specific way.

• 55:48Jordi Hays?

  And, but one of the challenges is when everybody evacuates and then an ember falls like in your backyard. Like, let's say it lands in the wrong spot and it starts this little fire and you're not there. And so I was thinking you're going to apply, have a drone basically stationed on your roof that would just use, would patrol your, you know, effectively your house while you were away. And so I think, I do think there's a mix of. High level.

• 56:11John Coogan?

  My contractor showed me a house that he built where it's just, it's just a sprinkler on the roof. That's it. It just spits out a ton of water everywhere if you turn it on.

• 56:18Jordi Hays?

  Yeah, yeah, yeah.

• 56:19John Coogan?

  It's like low tech.

• 56:20Jordi Hays?

  And so, yeah, there's a guy.

• 56:22John Coogan?

  Showing images from Japan, there's like some crazy automated turret that comes out if they have a fire. Yeah. And it goes back to like, there are two ways to deal with climate change. One is don't build the house in the first place, live in the cave and live in squalor. And the other way is build the fire fighting technology and, and clear the fields and build robots to clear fields and send up the goats. And, and do the controlled burns and do all this stuff. And that's the more techno optimist, pro acceleration, like path that I want to take. And the, the New Yorker and the insurance, reinsurance brokers in Switzerland and Germany agree with me. They say, one thing that virtually all.

• 57:04Jordi Hays?

  Those guys always, they, they just, they just like that you're 6'8" Chad. They agree with, they agree with everything you say.

• 57:10John Coogan?

  One thing that virtually all sides agree on from the senior brass at Swiss Re and Munich Re on down is the importance of investing more resources towards adapting our natural and human environments, including homes and other structures to make them more resilient to climate change. That's easy to say affecting real change would involve making big decisions at different levels of government about contentious issues, including public spending, zoning, building codes and taxation. Heller conceded that getting consensus for reform is a formidable task and noted that the economic fallout from climate change is affecting districts regardless of their political affiliation. And that's like super true here because you have the Palisades and Altadena, probably very different political alignments and, and kind of just average net worth. But there, there should be both aligned.

• 57:55John Coogan?

  The hope is that they all get aligned around, let's be more proactive, let's do more positive stuff, let's build. As opposed to let's cut back and let's restrict, which is rough. Anyway, I think that wraps up our deep dive for today. Lot of rough stuff out there, but

• 58:10Jordi Hays?

  Tragic.

• 58:11John Coogan?

  Pretty interesting to dig into. Hopefully, we're learning some things. Let's go to some DMs. I got a good DM from Frank. He said, he recommends a new segment on the show called Forward Deployed Technology Brother of the Week. He's recommending pic submissions, picture submissions from brothers in the field, test sites, on the road, offshore, etc. Scenery aesthetics, grit and grind, sunsets, sunrise, coffee and nicotine, not group photos. Would be a goldmine for the Gundo guys. More American terrain on the timeline, not less. More redacted desert locations, not less. Segment sponsored by Ramp for enabling travel and logistics, or Palantir,

• 58:48Jordi Hays?

  That's a great Ramp travel bit.

• 58:50John Coogan?

  Who has popularized the Forward Deployed Freiatriology. Creative liberties, loose interpretations of Forward Deployed could basically mean anything offsite, like Zuck venturing into Texas for JRE. I love this.

• 59:01Jordi Hays?

  I love this. Great idea, Frank.

• 59:03John Coogan?

  Send us your recommendations if you want to be featured as a Forward Deployed Technology Brother of the Week.

• 59:08Jordi Hays?

  And we'll just put it out there right now.

• 59:10John Coogan?

  Either

• 59:10Jordi Hays?

  Until further notice, every, every time you tag, you know, say, I'm Forward Deployed and tag us.

• 59:16John Coogan?

  Yep.

• 59:17Jordi Hays?

  We will feature it on the show.

• 59:18John Coogan?

  Yep.

• 59:20John Coogan?

  We have a request for, from Brandon Jacoby, who's been featured on the show under some personalities.

• 59:28Jordi Hays?

  Brandon, hopefully, hopefully, Jacoby, hopefully, I can share this. Apparently, he's now the only designer employed at X. One designer at X. If you have any issues with X at all, DM Brandon.

• 59:41John Coogan?

  He's the only one.

• 59:41Jordi Hays?

  And tell him the technology brother sent you. He was just texting me like two minutes ago, so.

• 59:46John Coogan?

  That's great.

• 59:46Jordi Hays?

  Yeah, just flood his DMs, like hundreds of messages. If we flood his DMs enough, the DMs product will get better.

• 59:53John Coogan?

  You know, I, I think I actually, I don't know if it was him or Yak Seen, but I actually DM'd someone that, there was this weird feature when you, when you press and hold on a video, it speeds it up to 2X. It's a great feature. But for a while, it would put this big 2X icon, like right in the middle of the video. And I was like, I don't need to know that, A, and B, like just throw that in the corner up at the top. And I sent it in, and then I was like, ah, these, and one of the guys was like, yeah, I'll fix it today. And I was like, oh, cool, you move so fast. And then a couple of days later, it was still up. And I was like, nah, they were probably just like messing with me. But then it did get fixed. And so I love it. So, yeah.

• 1:00:28John Coogan?

  You can, you can, you can affect real change, but the reason Brandon Jacoby is asking us to react to this picture that Sarah Hess posted is that she posted a picture of a, of a watch and says when the second, when the SpaceX secondary finally hits. And it's a Audemar Piguet, Royal Oak chronograph, beautiful piece.

• 1:00:50Jordi Hays?

  I can't really tell it's black.

• 1:00:51John Coogan?

  I don't know. Beautiful looking watch. Already people like the watch.

• 1:00:55Jordi Hays?

  Sarah just mogs the entire deep tech, defense tech community. The other day she was posting a.

• 1:01:02John Coogan?

  What was that?

• 1:01:03Jordi Hays?

  The other day she was posting her and I think a G-Wagon six by six.

• 1:01:06John Coogan?

  The six by six.

• 1:01:07Jordi Hays?

  Being like, this is a good daily for defense tech. So all you guys out there need to get on Sarah's level.

• 1:01:13John Coogan?

  That caused a little bit of a stir. A lot of, a lot of defense tech bros were like, no, it's the high locks.

• 1:01:17Jordi Hays?

  The high locks, yeah, the raptor.

• 1:01:19John Coogan?

  The raptor, but you know, you can't go wrong with a six by six.

• 1:01:22Jordi Hays?

  I think, I think the cool thing is if you're in defense tech manufacturing or whatever, and you're just on the road, you're a forward deployed technology brother.

• 1:01:30John Coogan?

  Yeah.

• 1:01:30Jordi Hays?

  It's just so, there's, you're, you find yourself in such fantastical situations that it doesn't matter what you're driving and it's still cool.

• 1:01:38John Coogan?

  Exactly.

• 1:01:38Jordi Hays?

  You could have Warren Buffett's old Camry and you have, it's just covered in dust and sand and you know, it's got like a bunch of Lucy cans in the back. It just looks cool. If you're in a six by six, great.

• 1:01:51John Coogan?

  The real question is, would Augustus Dorico have gotten stuck in the mud if he was driving the six by six?

• 1:01:57Jordi Hays?

  No, absolutely.

• 1:01:58John Coogan?

  I don't think so.

• 1:01:58Jordi Hays?

  I don't think so. And also.

• 1:02:00John Coogan?

  It's six wheel drive.

• 1:02:01Jordi Hays?

  Rainmaker should have, Rainmaker should have a tank. Like they've raised enough capital at this point. They should have a tank that launches drones out of it and has the treads. But anyways, all you technology brothers out there, stop getting mugged by Sarah.

• 1:02:16John Coogan?

  Step it up.

• 1:02:17Jordi Hays?

  She's posting the proof daily on the timeline.

• 1:02:21John Coogan?

  Let's go to Civilization Enjoyer. Another question for us says, I love you tech bros pod. Thank you. We love you too. Civilization, Civilization Enjoyer.

• 1:02:27Jordi Hays?

  Civilization.

• 1:02:28John Coogan?

  Can you recommend a timepiece for me in my budget range? And there's some sort of like foreign symbol here. I don't know what that means, but it says 56.34. Is this European money? I think it's European money. And so in European, the Europeans, they use periods instead of commas, right?

• 1:02:46Jordi Hays?

  Anytime I go to Europe, I just use dollars the whole time. They're just so liquid. I just.

• 1:02:52John Coogan?

  Deal with it. So is this $56,340?

• 1:02:56Jordi Hays?

  Yeah.

• 1:02:57John Coogan?

  Because at that, I mean, you could get the Royal Chronograph, probably. That's around 50k, right?

• 1:03:02Jordi Hays?

  Yeah, let me check.

• 1:03:02John Coogan?

  You're not going to be in Nautilus territory.

• 1:03:05Jordi Hays?

  I mean, you're close.

• 1:03:06John Coogan?

  You could get a Vacheron overseas. You could get a Daytona, probably. Yeah, easily Daytona.

• 1:03:12Jordi Hays?

  The other option here, the other option here with a, with a budget like that is, is you could have, you know, your father, grandfather, you know, some family member give, give you a watch, you know, as like a family heirloom and then use your budget on getting it tuned up a little bit, taking it to somebody to get it serviced and then buy like half a Bitcoin with the other 50 grand.

• 1:03:36John Coogan?

  Yeah. But on the off chance that he's saying $56.34, what, what, what would you recommend then? I think you gotta go used Casio or G-Shock, something on eBay, something that's respectable to the watch guys. Maybe something, you know, a Navy SEAL, an operator has used and is all banged up.

• 1:03:57Jordi Hays?

  Something like that.

• 1:03:57John Coogan?

  Buy Jaco Willink's old cracked G-Shock. That's something you could get for 50 bucks. He might just send it to you for free. I mean, you're in territory where you might just want to do a little bit of e-bagging and just, and just beg for someone to send you an old watch at this point. But something with a story. I'm sure there's somebody out there.

• 1:04:18Jordi Hays?

  Anybody, anybody out there that's listening, if you have an old cool watch that's gathering dust, please give it to civilization. Enjoy. We're happy to help intermediate it. We'd love to get him a watch. First of many.

• 1:04:30John Coogan?

  Yeah. Get him started. I mean, I, it's already a bad sign that he's dealing with the foreign money. It's rough. Anyway, let's go to Miles.

• 1:04:39Jordi Hays?

  Funny to be saying you enjoy civilization from Europe.

• 1:04:42John Coogan?

  Yeah.

• 1:04:43Jordi Hays?

  Considering that they've been sliding backwards.

• 1:04:48John Coogan?

  Miles Snyder asks us, "I feel like these $4,500 Rick Rubin approved headphones are the perfect podcasting accessory for a self-respecting technology brother. It's the LCD 5 flagship headphones. Highly recommend going and picking these up. They're open back. Have you seen that? So they're actually loud to other people. You know about these? Open back headphones. Yeah. They, they, they play the music. It creates this real soundstage. So you can hear the music all over the place, but they, they don't isolate it to the outside world. So other, you're just mugging everyone else with your noisy headphones.

• 1:05:23Jordi Hays?

  Last night I was fucking with Sarah and I, I usually will listen to like an audiobook or video, whatever, going to bed without the screen off. And I took my headphones and I just threw them over my, like, towards her side of the bed. And I just started putting on like this, like, educational, like, kids, kids song. It just like, took her like 10 seconds. She was like, what the fuck are you watching? I was watching, like, I'd watched a video with Roman on, on how oil rigs work. I didn't know this, but a lot of them are actually pontoon boats where they are sunk in underneath the water. You should do deep dive on oil rigs.

• 1:06:01John Coogan?

  Hyundai Heavy Industries, I believe is one of them that makes it. They make the, the electric cars and oil rigs. Grant says, "Getting bucket pulled on Tech Bros pod is the teapot equivalent of getting bucket pulled on Kill Tony. Salute." That's correct. We were inspired by Kill Tony. We'd, we'd been doing a lot of post reactions and we wanted to mix it up, make sure that we got to the real bangers from the brothers, from the friends of the show, the really key stories. But we wanted to mix in some random stuff. So we printed a bunch more posts, threw them in this bucket. We're really building up a thing. And these are random. They're more timeless.

• 1:06:42Jordi Hays?

  We have such a backlog, we might have to move to two episodes a ten.

• 1:06:44John Coogan?

  We have to if we want to get through these. And so we'll do some bucket pulls later in the show. A little bit more random, some friends, some randoms in here, a lot of timeless stuff and, and a little bit more focused just on good text posts. Not something that we need to necessarily make sure we're hitting in a timely fashion, but it's more of just a random way to make sure anyone has a chance to get on the show. Let's. Go to a question that I got from a friend says, pod is crushing, by the way. Also, question, do you think it's a good idea to work for Doge? Hmm. Well, what do you want? And I, and I answered and we went, we chatted for a little bit. I said, uh, well, what do you want out of life? What's your long-term goal?

• 1:07:27John Coogan?

  And so question is like, uh, this guy has been working in tech. He's been, you know, an associate at a venture capital firm, worked at a kind of series A, series B startup. That was kind of pre-product market fit. Done some stuff, product manager style. And he's now thinking about joining Doge. What do you think?

• 1:07:44Jordi Hays?

  So there's a range of ways that you can work on Doge. I don't know how much of it's public or private yet, but, uh, at a high level, you can go and actually have a long-term like role within.

• 1:07:59John Coogan?

  A job.

• 1:08:00Jordi Hays?

  A job, like a long-term job. And then there's also these sort of rotating groups that are rotating in for.

• 1:08:06John Coogan?

  Yep.

• 1:08:06Jordi Hays?

  90-day sprints to work on specific projects. Yeah. And so, so I, it's hard to know. I think, um.

• 1:08:13John Coogan?

  I think he's thinking full-time, like this will be the next couple of years.

• 1:08:17Jordi Hays?

  Yeah, I think Doge is an incredible opportunity if you don't have your thing yet.

• 1:08:23John Coogan?

  Yeah.

• 1:08:23Jordi Hays?

  Right? Or if you're working a job that you just don't care about that much, which I doubt any of the brothers do because they are, uh, corporate athletes and they'll find a way to care about anything. But, um, uh, yeah, I just, I, I think it's honestly the 90-day route and taking a sabbatical from your job and doing that is cool. The like long-term, you know, in it.

• 1:08:45John Coogan?

  There was actually a recent study on our audience and they found that we have the highest percentage of listeners who are doing their life's work of any podcast in the world. I thought it was exciting. So.

• 1:08:56Jordi Hays?

  Cool. Yeah, yeah, yeah.

• 1:08:58John Coogan?

  The, the, I, my, my thought for him was like, you should think about what your life's goal is. Because. If you're going into the government, that can be a great track for the right type of person. And but if you stay in finance, that can be the right track for a different type of person, starting a company and and building it up.

• 1:09:17Jordi Hays?

  I almost like the Doge, as great as it is, there's all these technology entrepreneurs that and people within tech that are going and joining Doge. We also need people from that have histories in Washington to join, is they actually understand how people, how Washington works and how government works.

• 1:09:36John Coogan?

  Yeah.

• 1:09:37Jordi Hays?

  Complicated stuff, you know?

• 1:09:38John Coogan?

  Yeah, it's clearly.

• 1:09:39Jordi Hays?

  Not for the faint of heart. So, so I hope that we're pulling in people

• 1:09:43John Coogan?

  Yeah.

• 1:09:43Jordi Hays?

  from Washington to to participate in this because I think they'll be much stronger if they're like collaborating.

• 1:09:49John Coogan?

  Yeah. I imagine the correct formulation is like a blend like what happened with Anduril, where it was like three Palantir guys, Palmer Lucky, who had no experience in defense, but is like this crazy engineer.

• 1:10:00Jordi Hays?

  Hardware guy.

• 1:10:00John Coogan?

  And then, and then Chris Bros joins, who's been McCain's chief of staff and like the swampiest dude in the world.

• 1:10:07Jordi Hays?

  Yeah.

• 1:10:08John Coogan?

  I say that lovely, but, but, but it really is important that they have someone like that who's been on the Hill for so long, really, really add, add to the, add to the information. Okay, let's see. Okay, we got all these, we're good.

• 1:10:22Jordi Hays?

  I got a promoted post. So today, this promoted post is from the Department of State and the, and the DEA, actually, the Drug Enforcement Agency and the

• 1:10:34John Coogan?

  The feds.

• 1:10:34Jordi Hays?

  US Department, the US Department of Justice. So we actually, today, we have a promoted post.

• 1:10:39John Coogan?

  From the feds.

• 1:10:40Jordi Hays?

  From the Narcotics Rewards Program, saying that they, the reward for information leading to the arrest and or conviction of Nicolas Maduro, Venezuela, has increased up to 25 million. So this is like, you know, typical, this is like basically like getting a pre-seed round for like an AI company.

• 1:11:01John Coogan?

  It's more like a mango seed.

• 1:11:02Jordi Hays?

  It's like a mango seed for your AI company. Or like if you're a good Y, if you're a good YC company, you might come out of demo day, skip the seed round and go straight to the, you know, 25 on 100.

• 1:11:13John Coogan?

  Yep.

• 1:11:14Jordi Hays?

  And, but anyways, this would go straight into your pocket. So Nicolas has been, Nick has had some issues with narco-terrorism.

• 1:11:31John Coogan?

  He had to run in with the feds. He's had a rough go.

• 1:11:39John Coogan?

  He's accused of narco-terrorism.

• 1:11:41Jordi Hays?

  Yeah, okay, he hasn't, innocent until proven guilty.

• 1:11:44John Coogan?

  Yeah, allegedly, allegedly Nick has done some narco-terrorism.

• 1:11:48Jordi Hays?

  Narco-terrorism, cocaine importation, conspiracy to use and carry machine guns and destructive devices, devices in furtherance of a drug crime. So anyways, no coupon code this time, but you can send tips to the Drug Enforcement Agency by email at cartelsoleas tips at DEA.

• 1:12:09John Coogan?

  And for the, for the folks who might be trying to track him down, can you give me some overview of who Nicolas Maduro is and what he might look like if I see him on the

• 1:12:17Jordi Hays?

  street? Nicolas Maduro Moros is a Venezuelan politician who has served as president of Venezuela since 2013. He began his working life as a bus driver. He's clearly got vision, even though he may have had some issues with the law. Maduro rose to become a trade union leader. Ouch, that was his first problem, clearly, before being elected to the National Assembly in 2000. He's got a wife that he married in 2013, Celia Flores. If you know Celia, you could ask her.

• 1:12:48Jordi Hays?

  He's 6'3", Chad.

• 1:12:50John Coogan?

  Okay.

• 1:12:52John Coogan?

  Like that.

• 1:12:52Jordi Hays?

  And, uh, yeah, basically.

• 1:12:55John Coogan?

  63?

• 1:12:56Jordi Hays?

  62 years old. Normally, I guess he hangs out in Caracas.

• 1:13:00John Coogan?

  Okay.

• 1:13:00Jordi Hays?

  Venezuela, so, anyways, just a great opportunity. I, I don't think enough passport bro, passport bros will often talk about, oh, I have this e-commerce business, or I have this course business. I think there's a big opportunity to just like, start contracting with the DEA, going after some of these bounties. And this 25 million could fund quite a long stint in South America, if that's what you want in life. So go get after it.

• 1:13:27John Coogan?

  Fantastic.

• 1:13:28Jordi Hays?

  And if you're, if you're more of like a course bro, which I don't think a lot of our listeners are, you could create courses on how to go after DEA bounties and how, how you could track down a narco terrorist like.

• 1:13:42John Coogan?

  A lot of great, a lot of opportunity these days.

• 1:13:44Jordi Hays?

  Yeah. So anyways.

• 1:13:45John Coogan?

  We love to see it.

• 1:13:45Jordi Hays?

  Check it out. We'll, we'll try to promote as many of these on the show as possible.

• 1:13:49John Coogan?

  And if you do, tell the, tell the DEA, Technology Brothers sent you. Tell them you heard about the, the opportunity on the pod.

• 1:13:56Jordi Hays?

  Yes. Really key. We get, we don't need any of the payout. We just want a little credit.

• 1:14:04John Coogan?

  We want the credit. Okay. This is good.

• 1:14:07Jordi Hays?

  Back to the show.

• 1:14:07John Coogan?

  So back to the show. Max Passion and Fury, at Passion and Fury. Go give them a, go give them a follow.

• 1:14:14Jordi Hays?

  Thank you to the Lone Ranger for putting this on our roadmap.

• 1:14:18John Coogan?

  We appreciate it.

• 1:14:19Jordi Hays?

  I didn't know that. I didn't know the increase. So.

• 1:14:22John Coogan?

  It's a lot of money.

• 1:14:22Jordi Hays?

  Yeah.

• 1:14:24John Coogan?

  So Max, listener of the pod says, new technology for the Technology Brothers. He built a tool to quick, quickly grab all clips referencing every mentioned X post on the pod. All you need is a YouTube URL, at Jordi Hays, at Jaco Kugan. Would this be helpful?

• 1:14:41Jordi Hays?

  Did you say Jaco Kugan?

• 1:14:43John Coogan?

  Jaco Kugan. That's my, that's my goal is to just become the Jaco Willink of tech.

• 1:14:50John Coogan?

  And it's amazing. You, you dump in one of our, our show URLs and it really slices it up. This is amazing.

• 1:14:56Jordi Hays?

  He built this as a live product.

• 1:14:57John Coogan?

  Yeah.

• 1:14:57Jordi Hays?

  It's techbrosclips.com.

• 1:14:59John Coogan?

  Yeah.

• 1:14:59Jordi Hays?

  And you can punch in.

• 1:15:00John Coogan?

  Oh, if everyone goes there, it's gonna blow up the site probably.

• 1:15:04Jordi Hays?

  Well, it'll be a good test.

• 1:15:05John Coogan?

  But yeah, get a, get a content delivery network up buddy, because the traffic's coming. It's been super helpful to us already. Slices everything up. We're working on a slight iteration, but I think this should really speed up the flow of the show. So that as soon as we wrap, boom, we put it in there, the editors can punch some of this stuff up and it can go out on X, which has been a huge, huge growth hack for us. And if we catch you stealing our growth hack, you're gonna hear from us. Let's go to Megan Nivold. She says, yeah, I'll be going now and takes a picture of her purse where she has put a piece of fried chicken in there. And what's that? A beautiful tin of Lucy patches in her purse. I love it.

• 1:15:46Jordi Hays?

  Megan, also.

• 1:15:49Jordi Hays?

  Mogs the timeline.

• 1:15:50John Coogan?

  Totally.

• 1:15:50Jordi Hays?

  Mogs a lot of the other brothers with just like constantly living that sort of loud, opulent.

• 1:15:56John Coogan?

  Loud, opulent.

• 1:15:57Jordi Hays?

  TB lifestyle.

• 1:15:58John Coogan?

  The Corona, the Aquapana, the french fry boat.

• 1:16:02Jordi Hays?

  Probably truffle fries.

• 1:16:03John Coogan?

  Fantastic lifestyle. It's great.

• 1:16:05Jordi Hays?

  Yep.

• 1:16:05John Coogan?

  Enjoy.

• 1:16:06Jordi Hays?

  Go Megan.

• 1:16:07John Coogan?

  Thanks for supporting my company. Thanks for supporting the pro nicotine pouch community and helping evangelize us.

• 1:16:14Jordi Hays?

  Thank you for supporting IQ.

• 1:16:15John Coogan?

  Yes, yes. Uh, should we do a bucket poll? We've been, we've been talking it up. Maybe we do a bucket poll.

• 1:16:21Jordi Hays?

  Let's see. Okay. This one's gonna be truly random this time because. Do we have two champagne buckets, by the way? Cause the next Dom episode, we might have to just throw the Dom in with the bucket.

• 1:16:32John Coogan?

  I can't believe I pulled this one. Oh my God. Yeah. Okay. Tokyo Sunbather says,

• 1:16:41John Coogan?

  Carl Marx failed to consider how dripped out I look walking out of the Polo Ralph Lorenz store. There is a man riding a horse on top of my chest, you communist retard.

• 1:16:55Jordi Hays?

  Well, we don't use the R word on this show, but.

• 1:16:57John Coogan?

  He's it's low class and vulgar, but I'm quoting him. So that is an acceptable use.

• 1:17:01Jordi Hays?

  But Carl Marx.

• 1:17:02John Coogan?

  I don't use it as pejorative.

• 1:17:03Jordi Hays?

  If, if, if ever we were to use that word, it would be in reference to Carl Marx.

• 1:17:07John Coogan?

  But that is a hilarious post.

• 1:17:09Jordi Hays?

  Yeah, I probably read that a few times. Really, really enjoyed it. Yeah, that's, that's, that's non ironically why capitalism is so great.

• 1:17:19John Coogan?

  Yeah.

• 1:17:20Jordi Hays?

  Because you can get dripped out.

• 1:17:22John Coogan?

  Yeah.

• 1:17:23Jordi Hays?

  Exceedingly so, so back in the Soviet Union.

• 1:17:26John Coogan?

  Jeans.

• 1:17:27Jordi Hays?

  If you were, yeah, jeans were a big thing. If you traveled through the Soviet Union wearing jeans,

• 1:17:31John Coogan?

  Yeah.

• 1:17:32Jordi Hays?

  People would come up to you relentlessly, making you offers and they wouldn't even have anything to offer in the trade. They'd be like, hey, I have this like exotic melon that I grew in my backyard. I'll give you three of them if you give me your jeans. And you're like, I'll keep my jeans.

• 1:17:48John Coogan?

  Melon.

• 1:17:51John Coogan?

  Wild. Great post.

• 1:17:53Jordi Hays?

  Great post.

• 1:17:54John Coogan?

  Hilarious. Uh, let's go to Jason Lou. He says, do it scared. I believe many people struggle with the insecurity of being intelligent. They often feel the need to prove their intelligence by overthinking, excessively planning and acquiring knowledge before taking action. However, this approach is a waste of time. The more you research, the more you realize how, how little you actually know. Instead, you just have to do it, even if you're scared. Literature is the most agreeable way of ignoring life. Yeah, there's a lot of that like hustle porn, like I need more mental models, I need more frameworks before I go and build the thing. And nine times out of 10, it's just like, just go give it a shot. And this is like the whole Y C thing is like you show up, it's like demo days ticking clock 90 days. You gotta put something on stage, gotta grow, gotta build the business.

• 1:18:35John Coogan?

  Like if you go into a office hours and you're like, I'm thinking about a frame, it'll be like, shut up, like go code.

• 1:18:42Jordi Hays?

  Yeah. What meeting structure should I use?

• 1:18:44John Coogan?

  Yeah.

• 1:18:44Jordi Hays?

  Yeah, all that stuff.

• 1:18:46John Coogan?

  Doesn't matter.

• 1:18:46Jordi Hays?

  Yeah. The other thing Will, Will was posting recently about how if you are gonna read a ton of books instead of doing the actual thing, which at points in your life is worth doing.

• 1:18:59Jordi Hays?

  Don't read the same books as everyone else.

• 1:19:01John Coogan?

  Yeah.

• 1:19:01Jordi Hays?

  So don't read the same.

• 1:19:03John Coogan?

  Yep.

• 1:19:04Jordi Hays?

  Yeah. One, don't read founder biographies, just listen to founders podcasts. Two, don't read the same like business-y self-help books. Go weird, go read weird, strange stuff like from the crazy.

• 1:19:17John Coogan?

  The biggest bull signal is when you're searching someone on a Wikipedia page, you go to the sources, it's some ISBN number. You go to Amazon, $2,000 book, won't ship to you in a month because it's out of stock. You gotta find some library that has it in stock, not digitized, there's no Kindle version, there's no audiobook version. That's where the alpha is.

• 1:19:38Jordi Hays?

  Do you know, you know that book, there, there is no anti-mobetics division?

• 1:19:41John Coogan?

  Yeah, it's like trading at like $3,000.

• 1:19:43Jordi Hays?

  Yeah, I have, I have a copy and it's like, yeah, they went out of print for a second. Mooned, yeah.

• 1:19:49John Coogan?

  Hilarious.

• 1:19:49Jordi Hays?

  Nobody knows what the book's even about.

• 1:19:51John Coogan?

  But library card's deeply underrated.

• 1:19:53Jordi Hays?

  Yeah.

• 1:19:54John Coogan?

  When, when Ben and I were doing some video essays, I would, we would just go over to the library and just pick up like every book on whatever topic it was. Like I was doing something on GTA and the history of Grand Theft Auto. And there's like one really good book that serves as like the backbone of the story. But there are like 20 other books that like have paragraphs mentioning it or talk about the development of the industry.

• 1:20:15Jordi Hays?

  Yeah, and you can talk to a librarian.

• 1:20:16John Coogan?

  All together, yeah.

• 1:20:17Jordi Hays?

  And they'll help you find all of that.

• 1:20:20John Coogan?

  I mean, even just walking around in the library, you'll find like, there's like the Trump section. We got 20 books about the history of Donald Trump and 20 books about the history of Joe Biden when we were doing those video essays about those. It's really, really cool. And so, yeah, you want to learn about insurance, like you can go on Twitter and listen to podcasts and, but just like, it's called like, I, I think of it like the shotgun method. Like when I'm trying to learn something new, it's like, I'll find like. You know, a textbook on it, but then also a biography of someone who built something in there, listen to a podcast on it. What does Odd Lots say about it? Read a Wiki, go to Hacker News, search Twitter, and then also just stroll the library until you've kind of like sprayed and prayed all over the place and just gotten a bunch of different information that you can

• 1:21:01John Coogan?

  put together. Cause like, that's probably not baked into the LLMs yet. So you need like random sources to put together. Then you get the alpha. Let's go to Hunter Gronk Wiz. Love the name. Says, just spent $60,000 buying a Stripe car. Women won't leave me alone now. Best investment I've ever made. And Jacob Martin asks us and asks, at Tech Rose Pod, found someone almost as committed to Stripe as you guys are to Ramp. Do you think this is real? Do you think he actually bought the car? It looks just like a taxi cab. And he's joking.

• 1:21:32Jordi Hays?

  He's joking, but I wish he wasn't. The Stripe, the Stripe car.

• 1:21:36John Coogan?

  Dripped.

• 1:21:37Jordi Hays?

  Very drippy. It says, says a lot about the kind of person you are. He says you value literature, independent publishing, smooth, sass.

• 1:21:47John Coogan?

  Irish nationalism.

• 1:21:48Jordi Hays?

  Irish nationalism, easy incorporation tools like Stripe Atlas. Says a lot with a little, you know? Says a lot more than like a martini racing Porsche. And I'm a huge Porsche fan. So, so.

• 1:22:01John Coogan?

  The livery, the Stripe livery goes hard. I would just like to see it on something with a little more horsepower. Couple more cylinders. Get the Stripe livery on a V10.

• 1:22:10Jordi Hays?

  Yeah. Yeah. I'd like to see somebody apply the Stripe livery on something.

• 1:22:16John Coogan?

  You know what? You know what it should be going on? BMW i8. Most undervalued car right now. 40K. You have doors that go like this.

• 1:22:23Jordi Hays?

  It's not under, I just will say it's not undervalued.

• 1:22:26John Coogan?

  It's undervalued.

• 1:22:27Jordi Hays?

  It's properly valued.

• 1:22:28John Coogan?

  It's undervalued. I know, I know it's not a great driver's car.

• 1:22:31Jordi Hays?

  I'm just saying it's properly valued because it's worth 40K today and it'll be worth 10K.

• 1:22:37John Coogan?

  No, no, it is undervalued because once associates at VC firms realize that they can have doors that go like this for the price of a Model 3, it's over.

• 1:22:46Jordi Hays?

  It's over.

• 1:22:46John Coogan?

  Get that, wrap it in the American flag. Oh, you're on the American dynamism team? Get an i8, wrap it in the American flag. Oh, you're working at Stripe? i8, wrap it in the Stripe logo.

• 1:22:55Jordi Hays?

  That car really.

• 1:22:57John Coogan?

  Half of them have already been wrapped.

• 1:22:58Jordi Hays?

  Eight years ago, eight years ago, I guess I hadn't moved to LA.

• 1:23:01John Coogan?

  Yeah, isn't it, isn't it a three cylinder?

• 1:23:03Jordi Hays?

  It, it, it was very hot for a second. It was like a very cool car.

• 1:23:07John Coogan?

  It looks cool and it's from a big brand.

• 1:23:09Jordi Hays?

  Yeah.

• 1:23:10John Coogan?

  It drives like trash, but that doesn't matter. It has doors that go like this, Jordy.

• 1:23:14Jordi Hays?

  The doors go up.

• 1:23:16John Coogan?

  The doors go up.

• 1:23:17Jordi Hays?

  I do, I do want to go, I want to go to the BMW Driving Experience Center in Palm Springs, by the way.

• 1:23:24John Coogan?

  What would you, what would you drive there?

• 1:23:26Jordi Hays?

  I, I would.

• 1:23:26John Coogan?

  What's your, what's your, what's your go to BMW?

• 1:23:29Jordi Hays?

  I'm, I, I actually like the way that BMWs drive generally.

• 1:23:34John Coogan?

  The modern ones? I would go, I would go manual M2.

• 1:23:37Jordi Hays?

  Yeah, yeah, yeah.

• 1:23:38John Coogan?

  Powder blue.

• 1:23:39Jordi Hays?

  Yeah, yeah, that's a great option.

• 1:23:40John Coogan?

  That's a good one. Still pretty light.

• 1:23:41Jordi Hays?

  But I would like to just go.

• 1:23:42John Coogan?

  Not the M5 that weighs 7,000 pounds.

• 1:23:44Jordi Hays?

  Get a good remote setup, dash cam.

• 1:23:45John Coogan?

  Totally.

• 1:23:46Jordi Hays?

  Starlink headsets and we're just, we record the pod just while racing around.

• 1:23:50John Coogan?

  Have you ever gotten into the old BMWs, like the E36, M3? If you know the numbers that go in front of the M3s, it's stupid.

• 1:24:00Jordi Hays?

  My car Sherpa, Michael lives here in LA, not, not far from the studio.

• 1:24:09Jordi Hays?

  He's big into that world, but, but not, not me.

• 1:24:12John Coogan?

  Let's do promoted post, another bucket pull.

• 1:24:14Jordi Hays?

  Promoted post. This, this promoted post is from Mahogany. Mahogany is the official wood of business.

• 1:24:22John Coogan?

  Fantastic.

• 1:24:23Jordi Hays?

  We just wanted to draw some attention to Mahogany. It's a great wood. They've got great grains. You can get it from all over the world, bunch of different sort of varietals. And I just can't stress enough, every business should run on ramp and every business should run on Mahogany. Get Mahogany around your office, your home. You know, ideally it's in your car in certain places. If you're buying the right manufacturers and you're getting them specked out properly, but.

• 1:24:53John Coogan?

  Get the I8, replace all the dash with Mahogany. Now we're talking, see? I can win you over on this.

• 1:24:58Jordi Hays?

  The side panels on the car.

• 1:24:59John Coogan?

  Swap, swap an F40 engine in there. Get the turbocharged V8 in the I8.

• 1:25:04Jordi Hays?

  Yeah, anyways, fantastic wood. Can't recommend it enough. And thank you to Mahogany for supporting the show.

• 1:25:12John Coogan?

  One last one. I8 Storato. That slaps. You throw some off-road tires on there, roof rack, the door seal go like this.

• 1:25:19Jordi Hays?

  Door still go up.

• 1:25:20John Coogan?

  You're good.

• 1:25:21Jordi Hays?

  You can't charge the car anywhere, so you gotta stay close to home, but you know, if you live at a ski resort.

• 1:25:27John Coogan?

  You don't need to charge it. It's not electric. It's a hybrid.

• 1:25:30Jordi Hays?

  It's not a, it's not a plug-in.

• 1:25:31John Coogan?

  It's not, it, it, it might be plug-in, but it doesn't matter. You can just put gas in.

• 1:25:35Jordi Hays?

  Cool. Okay, I'm, I'm.

• 1:25:36John Coogan?

  You're on board.

• 1:25:37Jordi Hays?

  I'm on board.

• 1:25:37John Coogan?

  We're getting to.

• 1:25:38Jordi Hays?

  We're getting to an I.

• 1:25:39John Coogan?

  We're crashing them.

• 1:25:39Jordi Hays?

  When I, crashing an I8 was like kind of the it thing to do.

• 1:25:45John Coogan?

  The supply, there's probably only like 40 left. They've all been crashed and wrapped by crypto entrepreneurs.

• 1:25:50Jordi Hays?

  The bull case for I8 is that so many of them.

• 1:25:54John Coogan?

  It's the halo car from like one of the most iconic brands, BMW.

• 1:25:58Jordi Hays?

  Okay, put your money where your mouth is.

• 1:26:00John Coogan?

  I'm gonna pick one up.

• 1:26:03John Coogan?

  This is stupid. We already talked about that. Bucket pull something else.

• 1:26:07Jordi Hays?

  Brutal bucket pull.

• 1:26:10John Coogan?

  Let's do that. Oh, this is good. Nikita Beer, he says, the three jobs after AGI actually. One, AI researcher. Two, influencer. Three, looter slash prisoner. What do you think?

• 1:26:21Jordi Hays?

  Feels pretty, pretty real after this last week.

• 1:26:25John Coogan?

  Yeah, not if you listen to Tyler Cowen on Dork Cash. He says it's gonna be very slow for AI to take over some of these more entrenched industries. The nonprofit people will still have jobs, the, the farmers, and if you talk to Brad Jacobs, he, when he set up his new fund, he specifically was looking for AI-resistant industries. Where'd he land? He landed in construction materials. He's rolling up construction materials companies, making it easy to order, order construction materials if you're a builder. Obviously, great timing, and I'm sure there'll be a bunch of interesting stories that come out of that company. His second most interesting choice, he, he surveyed all the different industries for AI resistance and also just economic opportunity.

• 1:27:09John Coogan?

  The one that he wanted to go with was oil and gas, but he couldn't, but the ESG thing was too overbearing.

• 1:27:14Jordi Hays?

  Yeah, I have a thesis around, it, it used to be young people would see the oil and gas industry as the same level of opportunity as technology.

• 1:27:24John Coogan?

  And Wall Street, yeah.

• 1:27:25Jordi Hays?

  Yeah, at Wall Street, where it's. Maybe you're in Texas.

• 1:27:28John Coogan?

  Yeah.

• 1:27:29Jordi Hays?

  Well, I'm gonna stay close to home and go into oil and gas. And for a very long time, it just was not even on the radar of

• 1:27:36John Coogan?

  Yeah.

• 1:27:36Jordi Hays?

  a lot of talented young people of going because it was so demonized.

• 1:27:39John Coogan?

  Yeah.

• 1:27:40Jordi Hays?

  Then it's like, okay, well, we need this stuff for

• 1:27:42John Coogan?

  Yeah.

• 1:27:42Jordi Hays?

  everything. So maybe it's not so bad.

• 1:27:45John Coogan?

  Yeah. You gotta watch that movie.

• 1:27:47Jordi Hays?

  The only thing I would add to Nikita's list is guys that repeatedly launch the same app and repeatedly sell it to large corporations because they want your time and

• 1:27:56John Coogan?

  Yeah.

• 1:27:57Jordi Hays?

  attention.

• 1:27:57John Coogan?

  Universal employment for Nikita, for sure.

• 1:27:59Jordi Hays?

  Yeah.

• 1:27:59John Coogan?

  And I mean, I guess he's influencer on, what's that, intro.com?

• 1:28:04Jordi Hays?

  Yeah, yeah, yeah.

• 1:28:04John Coogan?

  He'll be fine. Yeah, people will pay just to hang out with them.

• 1:28:07Jordi Hays?

  Yeah, yeah.

• 1:28:07John Coogan?

  Even if they're not, there's nothing left to build. I just want to talk to Nikita generally.

• 1:28:12Jordi Hays?

  Yeah.

• 1:28:12John Coogan?

  Tell me some war stories, Betty.

• 1:28:13Jordi Hays?

  Yeah.

• 1:28:14John Coogan?

  John Chu at Coastal Ventures says, why a $40 million pre-seed? You can prove your research direction with $5 million. Founder Somit Chintala told me VCs are willing to light dollars on fire for my pre-training, so I'm not going lo- lower. The spend plan includes his yearly multimillion dollar meta-salary in cash. We are deaf not in a bubble.

• 1:28:39Jordi Hays?

  I didn't really understand the format of this, but I do think that, uh, the, whatever, the high level $40 million pre-seed for an AI company was cool. I just, my only problem with it is if you, you could raise $15 million, spend a little bit, a little bit of money tracking down Nicholas Maduro.

• 1:28:56John Coogan?

  Yeah.

• 1:28:56Jordi Hays?

  And you could get this 25 million, non-dilutive, uh, basically, basically just, you know, straight cash for the balance sheet and then use this for all your pre-training.

• 1:29:07John Coogan?

  Yeah.

• 1:29:07Jordi Hays?

  Use this to buy a compute.

• 1:29:09John Coogan?

  Yeah.

• 1:29:09Jordi Hays?

  Spend this on Nvidia. And so, and, and, you know, I'd like to see this well transfer from the DEA

• 1:29:16John Coogan?

  Yeah.

• 1:29:16Jordi Hays?

  to Nvidia.

• 1:29:17John Coogan?

  Yeah. I wonder what the, what the stories are, like, what is the biggest reward that's ever actually been paid out by the federal government for a bounty like that? And who got it? What did they do with the money? Like, did it go to, like, Blackwater or did it go to just some random citizen who, like, called it in? I believe that there, there was a theory that there was a Whistleblower in the Osama bin Laden case that was retconned out and not told in the main story. Have you heard this? The Seymour Hersh theory. Seymour Hersh claims that the that the Zero Dark Thirty narrative, that it was like the CIA figured out where he was, and then they're sending the Blackhawks. And they were stealth helicopters, and they got

• 1:29:57John Coogan?

  through like the Iranian defenses, was it? Pakistani defenses. That is like, kind of a story that we tell to sound like a little bit more heroic, which based, I like it. But the the more the Seymour Hersh theory is that there was actually a whistleblower in the Pakistani government who called America and was like, I know where he is. I've I've I ran into bin Laden's driver. This is the location.

• 1:30:23Jordi Hays?

  And it could have been.

• 1:30:24John Coogan?

  Get me out and get me my $10 million for the bounty, and I will give you the direct access. And then, apparently, America went to went to the Pakistani government, said, we know where he is. We're either sending a missile tonight, or you're going to turn off your air defenses, and our Black Hawk helicopters are going to fly in. And they were like, okay, fine, you got us. We've been hiding him. Like, we'll let you go in. So it's not like a national incident. And then the the narrative globally turned into, oh, yeah, like, we snuck in, we broke through their air defenses, and like, they weren't complicit in it. So then there's not as much like, global, like, aggression towards Pakistan, because they weren't.

• 1:31:03Jordi Hays?

  Part of it.

• 1:31:04John Coogan?

  Caught. Yeah, exactly.

• 1:31:05Jordi Hays?

  Yeah.

• 1:31:05John Coogan?

  What were you about to say?

• 1:31:06Jordi Hays?

  Anyways, back to $40 million precedes.

• 1:31:10John Coogan?

  How do you know on bin Laden?

• 1:31:14Jordi Hays?

  Podcaster moment right there. But.

• 1:31:17John Coogan?

  Do we want to do Zuck? This one, I feel like it's kind of played out.

• 1:31:21Jordi Hays?

  I mean, we didn't really talk about it yet. I I don't have a lot of, you know, the old phrase, if you don't have anything nice to say, don't say it. I'm glad he came around, but I'm not.

• 1:31:32John Coogan?

  I haven't listened to the full episode yet, so I'll withhold my my take. Let's go to Jasmine's son. She says, ins and outs for 2025. Predictions are not endorsements. And the top one is lifted straight from our show. In ostentatious wealth, out quiet luxury. We have been firmly in favor of that. In open water swimming, out run clubs.

• 1:31:56Jordi Hays?

  I would say we were in, we've been in favor of loud opulence.

• 1:31:59John Coogan?

  Loud opulence.

• 1:31:59Jordi Hays?

  Which you can actually. Enjoy regardless of whatever wealth you have, you can doordash all day long, spend that on a bottle of Dom Perignon and pop it off, you know, to celebrate a hard day's work. So you can, you know, anybody can do it.

• 1:32:16John Coogan?

  So in are Mob Wives, Nietzsche, The Western Canon, going to the movies, aperitifs and digestifs. Russia is in and China is out. I don't know. In 996, out, quiet quitting. In email romance, out, dating apps. In cocaine, out weed. In secrets, out transparency. In fae one.

• 1:32:38Jordi Hays?

  That would actually be cool. A new dating app built around email would be, is weird enough that you could probably get a number of users.

• 1:32:47John Coogan?

  That's actually how Tinder started. They would do it all manually. So they would have, it was based on this thing that happened at Harvard where at the end of the year, everyone would submit names of people that they were like attracted to, but never actually had a chance to really go on a date with. And then if there was a mutual swipe right, essentially, if both people put down the same name, they would make an intro. And that was, and then they appify it.

• 1:33:10Jordi Hays?

  I never knew that.

• 1:33:10John Coogan?

  Yeah. In Manning Up and Moving On, out is Yearning. In Ball Up Top, like that. Out, Self-Reflection. In Traveling Circus.

• 1:33:22Jordi Hays?

  Never Reflect. Never Look in the Past.

• 1:33:25John Coogan?

  In Sketch Comedy, out Stand-Up Sets. A lot of good stuff in there. Thanks for posting that. I think that's a fun list. Do you want to do your own post? Newsom's Reign of Terror?

• 1:33:36Jordi Hays?

  I'll read it.

• 1:33:37John Coogan?

  Yeah, go through it.

• 1:33:39Jordi Hays?

  I, you know, Jeff Lewis and people like Josh Steinman

• 1:33:46John Coogan?

  Yeah.

• 1:33:47Jordi Hays?

  have talked over the last, basically the last week in saying, hey, most natural disasters aren't political, but it's actually important to make this one political because there were a number of failures by the state to address this problem before it started. And it's been interesting to watch Gavin Newsom. The vast majority of the communications that he's been putting out are all centered around correcting his image. So this guy, I think, is one of the most disgusting, despicable, evil political leaders that I've ever, I'd probably rather get a beer with Nicolas Maduro than Gavin Newsom.

• 1:34:26Jordi Hays?

  But anyway, so I had to share this. I shared this, I think, on Saturday. I was pretty frustrated and it definitely resonated. But I said Newsom's reign of terror will finally come to an end in 2026. That's when his term is up. Hopefully he gets recalled. And I think there's a bunch of petitions happening now. Years of zero leadership and degeneracy. I put that in there because he has a history of cheating on his wife with his staff and he also cheated on his wife with his best friend's wife, among other incidents. We now have dramatic visual evidence of his incredible incompetency and it's on full display for the nation and the world.

• 1:35:04Jordi Hays?

  Very, very, he couldn't have had a more high profile. The campfire, which was, you know, one of the most damaging fires, was in an area of the state that frankly does not have a lot of influential people or attention. This one is the crown jewel of California, Los Angeles, and it's just on full display. Very clear that the world now knows that he is incompetent. The fires will cost him any hope of winning the presidency, which he so desperately wanted. And you can see with his communication strategy this week, he's entirely fixated on yelling at Elon Musk for spreading lies when he is the biggest liar, the most lying politician that I've ever seen.

• 1:35:47Jordi Hays?

  His track record was always terrible, but his smooth talking kept the dream alive. I will give him credit. He always dresses well and he's good at yapping. Not anymore as these images will follow the rest of his sad career and be placed next to his name in the history books. And this is one of those things I literally think if there's going to be a history book on California, on this century, you'll have the Newsom era and the fires, these pictures will be placed next to his name because this is his handiwork. Los Angeles will rebuild, but Newsom won't have anything to do with it. So I don't think this guy, I don't think this guy will be able to walk around Los Angeles

• 1:36:26Jordi Hays?

  for the rest of his life without being yelled at and he deserves it. I mean, like, absolute scum. And I make a, we make a strong effort on the show to never be negative or put people down because everybody's doing their best. And, but in Newsom's case, his best is not. Where it needs to be. So, uh, please resign Newsom.

• 1:36:52John Coogan?

  So who, uh, who you got? Because Rick Caruso seems like the obvious pick for LA mayor. Uh, who should step in as governor?

• 1:37:02Jordi Hays?

  Man, I, I'm not a, um, my opinions on Newsom have only been from spending my entire life in California and getting to become an adult as his reign of terror, um, you know, was going on. And so I'm not a political, I, I don't have a lot of, uh, I don't follow the, the, the, the sort of, people in the stable closely enough. I, I don't think that Caruso after the Bass election wanted, I, I, prior to the fires, I don't think he would have run the next time. He wasn't like.

• 1:37:35John Coogan?

  Now people are like demanding it from him.

• 1:37:37Jordi Hays?

  Yeah. And, and I think Caruso's incredible. He has the only structures basically in the Palisades that are touching each other that are still standing. So if that's not proof that he's competent, I don't know what is. But he's getting up there. I don't know if he wants to do a four-year term. But he would be a good pick. But, um, and then we just need new leadership across the board. Uh, it also, I, I also had another post, um, can't be shared widely enough, but, um, uh, if there's one thing that we'll publicly, um, you know, sort of state that we do not, uh, uh, support, it is, um, communists. Karen Bass spent the first half of her career

• 1:38:20Jordi Hays?

  literally traveling to Cuba when it was illegal to travel to Cuba. So breaking the law, taking multiple trips, coordinating with the Cuban government to spread communism in the United States. She was praised by the biggest newspaper of the communist movement in the seventies as being the leader of the communists. And the group that she was involved with is like a violent extremist group. And this woman, uh, failed upward into Congress. She was a represent, not, not, uh, she was in the House of Representatives, representing California, came back, decided to become mayor and even people close to her have said that she had no plan for her, you know, uh,

• 1:39:00Jordi Hays?

  for her rule over Los Angeles. She just was the pick that would win, was the right person. And, um, anyways, so, uh, and, and, and Max Meyer posted this video.

• 1:39:14Jordi Hays?

  During, in a video on Sunday, she was talking about how we're going to rebuild Los Angeles and she was smiling through the whole video.

• 1:39:22John Coogan?

  Oh yeah, that was really weird.

• 1:39:23Jordi Hays?

  It's like, how do you, and Lulu was just ripping her apart because there's the science to addressing people in that situation and just couldn't, so like, clearly has no business running the city anymore. She needs to be recalled too. Gavin Newsom needs to be recalled too.

• 1:39:39John Coogan?

  My pick for governor, Dwayne The Rock Johnson.

• 1:39:43Jordi Hays?

  See, that's a good option.

• 1:39:44John Coogan?

  We had a great run with Torsten.

• 1:39:45Jordi Hays?

  You don't actually, yeah, yeah, we had a great run with LA. Yeah, and Bass had no, no insights or knowledge of how entertainment works, right? Like, it's like somebody in Detroit not understanding manufacturing. Put the rock in. So he's a tequila entrepreneur.

• 1:40:02John Coogan?

  Yeah.

• 1:40:02Jordi Hays?

  He's an entertainment mogul.

• 1:40:04John Coogan?

  Yeah, he's the highest paid.

• 1:40:05Jordi Hays?

  He has a huge neck.

• 1:40:07John Coogan?

  Huge neck. He's a mass monster.

• 1:40:09Jordi Hays?

  Mass monster, crazy output, crazy workouts.

• 1:40:13John Coogan?

  Yeah, it's clear that like, he understands the WWE wrestling style of politics to be able to go up and give a rousing speech when that's needed. Like, if he was called upon to make a speech after this, he would not be.

• 1:40:26Jordi Hays?

  Mel Gibson is another frontrunner for me.

• 1:40:29John Coogan?

  You saw his, you saw his.

• 1:40:31Jordi Hays?

  His son is a buddy of mine, a neighbor, actually.

• 1:40:34John Coogan?

  You saw, you saw his comment? It was like, his house burned down and he was like, I'm free of my material things. Just totally stoic.

• 1:40:40Jordi Hays?

  No, and he's, he's actually stoic.

• 1:40:42John Coogan?

  Yeah.

• 1:40:43Jordi Hays?

  I've, you know, I've had a, I've met him before at a birthday party and he's, he's a, I think he's a, I think he's a good dude with good intentions and, anyway, so I'm like, I'm very much looking forward to not ever having to talk about politics on this podcast again, but.

• 1:41:06John Coogan?

  Let's move on. To Tyler, he says, a wild conversation with a public company CEO. He says they have a $10 billion plus market cap. And they say, our top of funnel is getting completely crushed because we were so reliant on Google, but a ton of people have switched to AI search and we aren't there yet. One anecdote, but wow. I wonder what industry this is because I feel like for a lot of consumer products, the AI search hasn't really taken off and the AI search has mostly been replacing more like informational stuff where you would land on Wikipedia. I go to AI for, but if I'm shopping for like a new suit or something, I'm not going to go to ChatGPT because it's just going to like tell me about the suits generally.

• 1:41:51John Coogan?

  And I want to like be able to click and buy or something like that. So I wonder what industry that is.

• 1:41:56Jordi Hays?

  This goes, Anne Skates was talking last week about this sort of AI becoming these recommenders and how I think a massive amount of purchasing decisions will be driven by these sort of AI assistants that deeply understand you and your taste and get to disintermediate, you know, basically Google Ads and random searches. And this is already happening. So you can, there's a, there's something called, you can go on Delphi and like talk to somebody's clone and be like, what magnesium supplement do you recommend? It'll recommend that based on who that clone is made around. There's another company called Dexa that, that does like an AI chatbot just based on podcast,

• 1:42:41Jordi Hays?

  podcast transcripts. You can be like, what, you know, what is so and so think about this? And then it'll recommend the right product.

• 1:42:49John Coogan?

  Seems like, yeah, good, even more important than ever to switch from SEO to influencer marketing.

• 1:42:57John Coogan?

  Because you want to be baked into the LLM in a conversational way.

• 1:43:00Jordi Hays?

  That's true.

• 1:43:01John Coogan?

  Not necessarily in just like, oh, keyword search showed up.

• 1:43:03Jordi Hays?

  That's interesting. I never thought about that. I mean, my first company, branded native runs hundreds of influencer ads a month for.

• 1:43:12Jordi Hays?

  Various consumer brands and that's kind of an interesting thing of like you're building up this basically base of recommendations from-

• 1:43:18John Coogan?

  All of that will get baked into the LLMs, much more so than some optimized SEO landing page.

• 1:43:24Jordi Hays?

  Yeah, so if you want to optimize your results in LLMs, go to brandednative.com. It's a company I started when I was 22 and spend a bunch of money through our ad network.

• 1:43:36John Coogan?

  There we go. Let's do a promoted post.

• 1:43:39Jordi Hays?

  Promoted post. This is a fantastic post. I mean-

• 1:43:44John Coogan?

  This is our first horse post.

• 1:43:46Jordi Hays?

  Horse post and there's been sort of some ideas and thoughts out there that we don't, you know, we're always, you know, we support horse girls. We like the idea of horse girls. My daughter will be a horse girl and we are horse enthusiasts.

• 1:44:05John Coogan?

  Yes, equestrians.

• 1:44:06Jordi Hays?

  Equestrian, yeah, exactly. So this promoted post is from our friend, Tom Wilson, @tomwilsonhorses and he says, "This is what AA rated 3.2 million yearling looks like. Lot 1007." He's got home affairs crossed with sunlight and he has an entire video here just breaking down the incredible ergonomics and muscle structure of this fine stallion. He says, "The damn Nordic Charm," second page, "The damn Nordic Charm is by charge forward a Group 1 winning sprinter and established broad mare sire. Although Nordic Charm herself was unraced, she hails from a distinguished family. She is a half-sister to Liberator,

• 1:44:50Jordi Hays?

  the champion stayer in Hong Kong for 2011 to 2012, and Pink Cyrus, who produced Group 2 winner Aetna. The family traces back to the illustrious Miss Helga, a listed race winner and producer of quality offspring like Alexis, who is a Group 3 winner, and freshwater pearl- And so anyways, he's got a number of and and another one in here, just just while we're at lot 396, I am invincible crossed with fiery Vista. This is from Tom Magnier. It's only 1.1 million. So

• 1:45:25John Coogan?

  So if you've got a couple of million bucks burning a hole in your pocket, maybe you just sold the company to Atlassian. Go pick up one of these horses and tell them the technology brothers sent you.

• 1:45:34Jordi Hays?

  This might be our favorite colt in the sale. He's just a biomechanic and a geometric scorer.

• 1:45:41John Coogan?

  Fantastic. And people will say it's a lot of money, but I mean, look at it. It's a lot of horse.

• 1:45:45Jordi Hays?

  They're giving this, they're giving this sire away.

• 1:45:48John Coogan?

  Fantastic.

• 1:45:49Jordi Hays?

  So thank you to Tom Wilson and get back to the show.

• 1:45:54John Coogan?

  Bucket poll. Oh, this is a good one. Paul Bukite, YC partner, creator of Gmail, YC partner, says X should stop demoting links and instead use rock to attach a short summary of the linked content. It would achieve the same goal of keeping people on site, but be less annoying. And yeah, the demotion of links is really wild. We had a banger post that was completely silenced. The built different Google.com post, one of our greatest of all time, and it was destroyed by the fact that links are true.

• 1:46:30Jordi Hays?

  The post, the post was real posters, post links and still do numbers. Google, Google.com, built different and it had some early traction and it just died off completely. And the reason I was inspired by that, to be honest, is that Mark and Mark Andreessen is just not afraid to post links. So just rip a link and still do numbers. I think it helps to have millions of followers, you know, you can still, you know, do numbers off of a big base even with the algo, but. Post links. Don't let the algorithm rule your life. Rule the algorithm.

• 1:47:01John Coogan?

  I completely disagree. I say it is disrespectful to Elon's culture to post links on X. He's very politely asked through some very clear subtle messaging that you should not post links. But seriously, if you're a founder and you're trying to promote anything, just don't have the website in mind at all. Like, it needs to be fully X-native, and that's why, why do vibe reels go viral? Why do threads and long posts go viral? When Lulu launched her company, what did she do? She posted a long post, the Going Direct Manifesto, this one her brother of the year. And, and she understands that, you know, why try and fight with one hand tied your, tied behind your back with a link down in the comments and all that stuff? Like, just take it all native.

• 1:47:44Jordi Hays?

  Have your company have in your company's profile, have the link in the profile.

• 1:47:48John Coogan?

  Or just appeal to smart people who can figure it out. Like, just say.

• 1:47:52Jordi Hays?

  I don't, I don't, I, I think you.

• 1:47:53John Coogan?

  People don't need the handhold.

• 1:47:54Jordi Hays?

  From a pure conversion rate optimization standpoint, one click to your company profile, your project profile, or whatever you're trying to promote, link in that bio.

• 1:48:04John Coogan?

  Shut down your company. Your company is now your X account. Your monetization is your revenue. Your X check is your revenue.

• 1:48:10Jordi Hays?

  Get to a million dollars.

• 1:48:11John Coogan?

  There's a lot of founders making more money from X monetization than their companies. This is the future. Everyone's an influencer. AI has taken all the other jobs.

• 1:48:19Jordi Hays?

  One of the last jobs.

• 1:48:20John Coogan?

  So you don't need to link out. You just need to post.

• 1:48:22Jordi Hays?

  Yeah.

• 1:48:23John Coogan?

  Get that check, engagement bait, and you're good.

• 1:48:29John Coogan?

  I do like that idea, though. Let's go to Noah Smith. This is some good news. We're winning the war on cancer. U.S. death rates for all cancers from 1975 to 2022 have fallen significantly from a peak for, of, uh, for both sexes around 220, 210 per 100,000 people, down to sub 150. What do you think?

• 1:48:55John Coogan?

  I thought this was good.

• 1:48:55Jordi Hays?

  I mean, it's hard for me to even think about that, even though it's great news when Noah is doing absolute numbers on Substack.

• 1:49:03John Coogan?

  Yeah.

• 1:49:04Jordi Hays?

  Absolute Substack size lord.

• 1:49:06John Coogan?

  I mean, at this point, he doesn't even need healthcare. He can just pay out of pocket if he gets cancer.

• 1:49:10Jordi Hays?

  That's dark, but true. The guy's doing crazy numbers, has a bunch of paid subs, and it's because all the best journalism and journalists in the world are growing independent.

• 1:49:21John Coogan?

  Yep.

• 1:49:21Jordi Hays?

  And it's a death sentence for traditional media.

• 1:49:24John Coogan?

  It is. Yeah, he's done, he's done well. Should we wrap it up there?

• 1:49:28Jordi Hays?

  Yeah.

• 1:49:29John Coogan?

  That's a good place to end the show.

• 1:49:30Jordi Hays?

  This is a fun show.

• 1:49:31John Coogan?

  Thanks for watching.

• 1:49:32Jordi Hays?

  Looking forward to tomorrow. Thank you.