Marc Andreessen: Who Runs the World’s AI?

Cisco president and CPO Jeetu Patel speaks with a16z cofounder Marc Andreessen about why AI may finally break a 50-year productivity slump—and what's at stake if America doesn't win the race. They discuss where value will accrue in the AI stack, why open source complicates the US-China competition, and what's blowing Andreessen's mind right now.

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

• 0:00Marc Andreessen?

  There's a race underway and the stakes are basically what is the world going to run on? Don Valentine had this old rule of thumb. He said more startups die of indigestion than starvation in terms of the amount of money you put in. And his point was like scarcity does spark ingenuity. All of the science fiction novels basically have AI either being like super utopian or super dystopian, but they never have this incredible sense of humor aspect, which is what we're actually getting, where people are just using everything as a fodder for memes. The world will either be running on American AI or be running on Chinese AI. And I think it's very important which one wins for a bunch of reasons.

• 0:30Speaker 01

  For 50 years economists have tracked a strange pattern. Rapid technological change paired with historically low productivity growth. Since 1971, productivity has flatlined even as computing reshaped daily life. In 1880, productivity growth ran at three times today's rate. By 1930, it had slowed to twice as fast. Then came the regulations and the restrictions. We said no to nuclear power, faster cars, and a space program. What we got was hyper acceleration in chips and software and stagnation in nearly everything else. American labs lead for now, but Chinese open source models follow months behind at a fraction of the cost. The world will run on one system or the other, and the values baked into that system will matter. This conversation looks at what's actually happening

• 1:14Speaker 01

  in AI investment, where value might accrue, and why the regulatory response could determine which country wins. Gitu Patel, president and chief product officer at Cisco, speaks with Marc Andreessen, co-founder and general partner at Andreessen Horowitz.

• 1:31Speaker 02

  Marc Andreessen needs no introduction. He invented the browser. He built the internet. So I'm really excited to have you here.

• 1:39Marc Andreessen?

  I apologize for nothing.

• 1:42Speaker 02

  All right. So before we get started, you had a really interesting conversation that I wanted to actually start with just a couple of days ago with Lenny. And you were talking about this notion of... In the history of time, when has productivity really spiked? And what's happening right now? So can you just talk a little bit about your perspective on productivity increases that have happened at different phases in time? And where are we today compared to those times?

• 2:09Marc Andreessen?

  Yeah, so as everybody probably knows, productivity growth is like the key driver of economic growth. Like, it's the thing that actually causes the economy to expand. Economists measure it with something called total factor productivity. They measure it every year. The prevailing kind of myth of the last 50 years, basically my entire life, all of our entire lives, has been that we've been in this era of very rapid technological change, which would necessarily mean very rapid productivity growth. Yet, if you actually look at the statistics, basically since, actually, since the year I was born, 1971, productivity downshifted hard from prior eras. And productivity growth, basically, for the last 50, 55, 60 years, has been at, basically, historical lows. It's been very low, which is, by the way, why economic growth has been low, which, by

• 2:53Marc Andreessen?

  the way, is why the national mood has become so focused around, you know, zero-sum economics, populism, you know, the sense that if somebody's getting ahead, somebody else must be getting disadvantaged. If you compare and contrast that to the period between about 1930 to about 1970, productivity growth was roughly twice as fast through that period. And if you compare and contrast that to the period of 1880 through 1930, productivity growth was about three times as fast. So we had 3X, and then 2X, and then 1X. And so this is very not good, like, you know...

• 3:22Speaker 02

  Why do you think that is?

• 3:24Marc Andreessen?

  Most fundamentally, I think it's because we decided other things are more important. And in particular, in the last, you know, basically, since the 1970s, you know, if you just look at like the, if you just look at the charts of like the number of laws on the books, or the number of pages in the Federal Register, or the number of regulations in the economy, that, you know, it's just this, it was just this, like, knee in the curve went exponential, which continues. And so we just, you know, we decided we didn't want nuclear power, right? You know, we decided we didn't want a space program. You know, we decided we didn't want cars that went faster than 55. We decided, you know, we just decided we didn't want these things. And so what we got in the last 50 years was like hyper-acceleration in, very specifically, basically, chips, chips and software. And then what we got was basically, you know, essentially stagnation in everything else.

• 4:08Marc Andreessen?

  And so like, it's really not, it's really not good. And then, you know, but correspondingly, you know, of the many reasons to be excited about AI, like, put it this way, if either the AI optimists are correct, or the AI doomsayers are correct, productivity growth is about to go through the roof. So... And do you think it's like 2 or 3X? Is it 10X? Where do you think it gets to? So this is always one of these kinds of questions, like in a like completely deregulated economy, like in sort of Murray Rothbard's like, you know, dream of just like straight basically anarchic capitalism, you know, at least in theory, you could imagine an acceleration to, I don't know, 5%, 10%. I mean, if, you know, if you, again, if you believe in kind of either the optimists or the doomsayers, you're looking at such radical, you know,

• 4:49Marc Andreessen?

  AI representing radical software productivity growth and then robotics coming right behind, right? And robotics, of course, starting in the form of the self-driving car and the drone, but humanoid robots coming quickly, you know, you could imagine, you know, you could paint, you know, scenarios of 10%, 20%, 30%, something like that. I think in practice, you know, that's unlikely, again, just because like the robots have to have to agree to all the regulations also. And so, you know, there's a lot of things they're not going to be allowed to do. By the way, AI, you know, look, I give you a great example of this playing out today. I think if you're just like an ordinary person, I got food poisoning over the whole, I went on vacation, of course, immediately got sick, which always happens, I got food poisoning. And so I let, as an experiment, I let Dr. GPT like walk

• 5:34Marc Andreessen?

  me through basically every stage of food poisoning. And I just, I kept asking, like, I had nothing else to do because I'm flat on my back. So I just kept asking like more and more detailed questions about, you know, my physical experience and what I should do and what I should eat and how I should recover. And like, it's just like absolutely incredible. Like, it's just like the most amazing, like endlessly patient, sort of infinitely knowledgeable, endlessly caring doctor, you know, it doesn't get like irritated when I have the same question at 4:00 in the morning. And I'm like, well, could you go into that, you know, a little deeper? And are you sure it's not, you know, pancreatitis? And are you sure I'm not about to die? Oh, no, you know, it's okay. You know, you're absolutely fine. And it's just amazing. And then, of course, AI cannot be licensed as a doctor, right? That's like completely illegal, right? You cannot actually have an AI doctor. And so you do have this like basically massive disconnect. And again, I'm not saying I'm

• 6:18Marc Andreessen?

  advocating for the Murray Rothbard world. I'm not saying rip up all the regulations. I'm just saying like it just factually, objectively. It slows you down. Yeah. The, again, the hyper optimists and the doomsayers are not, neither one of them are going to get the world that they think that we're going to get. We're going to get something, we're going to get a muddle through the middle thing, which I think, by the way, I think is going to go quite well, but it's going to be a muddle and there's going to be a lot of tension, you know, kind of between those sides along the way. And then, given that, where does the value start accreting in the stack most? So I think this is a really, really, it's a really big question of we're professional investors on our side. And so, of course, we think about this all the time. And I actually think there's still more questions than answers than this, right? Because, you know, you can paint this picture that says that the, you know, the AI model companies are going to

• 7:02Marc Andreessen?

  basically own everything. And, you know, and you, by the way, you look at their, you know, you look at their, their businesses and they're doing fantastically well. You can also look at it and say, oh, no, that whole thing's going to be eaten by open source. And by the way, or by China, or by a combination of, of open source in China, which in China's doing great. This company, Kimi, just dropped a very competitive model to the latest, latest Claude at like, you know, 95% the capability at like a fraction of the price. And so, so there's like a very big open question there. You know, we happen to be at this moment, you know, what everybody believes. And, you know, if you look at Nvidia's, you know, deserved success over the last five years, you know, this, the reasonable conclusion is like chips, all of a sudden, like, you know, chips is where the action are, you know, there's, if you look at the stock market, there's like a rotation from software into hardware. You

• 7:44Marc Andreessen?

  know, and look, it's possible that like chips are the, you know, it's possible all the value accrues to the chips and the energy and then, and then the software's all open source. Having said that, every other time in history where we said the chips are where the value are that they commoditize, right? And so there's big questions there. And then there's, there's even more questions, I would say, at the, at the app layer, right? Which is, are you going to have apps that are going to sort of harness AI, for example, in spaces like medicine, where, you know, where they're going to, you know, be particularly like tailored and customized, or, you know, legal apps, or, or business apps of all kinds? Or are the models just going to do all that? And that, and that's, that's another area. And so I, I honestly, like, this is so new, like, this, this approach of, I mean, AI is an 80-year-old topic, but AI working in a way where this is the question, I think we're

• 8:28Marc Andreessen?

  only three years into, you know, probably a 30-year shift. And I actually think we don't know yet.

• 8:31Speaker 02

  And it seems like the value might accrete for, across all of these layers for, for the foreseeable future, because like, everything is getting refactored. So like, you will need to have a lot of infrared power, a lot of apps. Those apps are going to get, so what's your take on enterprise SaaS in general and what happens over there? And does that get completely rethought, reimagined, or?

• 8:55Marc Andreessen?

  So we're in a baby in a bathwater moment right now. Just look at the stock market. It's just like SaaS is just getting demolished. And so, and if you talk to like hedge fund managers, they're just like selling all their software just under the theory that they just want to get out of the way of the AI freight train. You know, as an investor, you kind of say, okay, that probably is overdoing it a bit. You probably want to look at like different kinds of software. And so, for example, in SaaS, you probably, my theory, you want to look at systems of record differently than you want to look at basically just productivity applications. You know, so that's one way of looking at it. Also, look like everybody doesn't change their behavior overnight. And so, you definitely want to look at loyalty and stickiness in lots of different ways. And then, you know, then there's this giant question, actually, in the tech industry, right, among all the

• 9:37Marc Andreessen?

  software companies, right, which is like, okay, if I'm, you know, if I'm Adobe, just to pick an example, Adobe, which is obviously a great company, but, you know, a question in front of Adobe that they're working on, but is a very good question, is like, okay, is Photoshop plus AI features an even better version of Photoshop? Or is Photoshop unnecessary in a world in which AI is just making all the images? And I think, I know as far people who will argue, who will argue both sides of that. And I think you can, I just use that as an example, you can apply that question to kind of every category of software. We are, we in our business are seeing a bunch of software companies that for sure are not moving fast enough to adopt. And, you know, and we're enthusiastically funding AI centric, you know, startups to go, you know, try to, try to take them out. Having said that,

• 10:20Marc Andreessen?

  we are also now seeing examples of, you know, more traditional software companies that have figured out an AI twist to what they're doing. And all of a sudden, they've, you know, ignited growth. And so I also think we'll probably see a lot of that. I mean, and my big conclusion from all this is I think, one of the reasons it's so hard to predict or kind of characterize all these things as like broad-based trends, is that like, human agency matters a lot, right? Which means leadership matters a lot, which means, you know, the CEO, you know, the people building the product, you know, have a vote here at every one of these companies, you know, what do they choose to do in response? And, you know, optimistically, hopefully, a lot of people will, will figure out, you know, how to have this be a plus and not a minus.

• 10:57Speaker 02

  You touched a little bit on open source in China. Talk a little bit more about like how that plays out. Does US get to be a dominant player in open source over time?

• 11:09Speaker 02

  You actually have a front row seat at a lot of the investments that are being made in a lot of these areas. What happens?

• 11:16Marc Andreessen?

  Yeah, so it's this, you know.

• 11:17Speaker 02

  And by the way, what are the implications too? Like if we don't do well in open source, what does that mean for the US?

• 11:23Marc Andreessen?

  Well, I guess you could say, look, maybe start by, because it's like a two by two grid. It's like US, China, open source, closed source.

• 11:28Speaker 02

  Yep.

• 11:28Marc Andreessen?

  Be a rough approximation. So like without open source, just start by saying without open source. Like without open source, there is a two horse race. There's a two horse technological geopolitical footrace, which is US versus China. So again, let's assume it's all proprietary for the moment. And, you know, both China has been on record for years in their national strategy, their five year plans, their national strategy and so forth. Like AI is, you know, cornerstone technology of the future. The US government, by the way, has been, you know, definitive on the record on this in many of its policy areas for the last decade.

• 12:00Marc Andreessen?

  And so, and, you know, and both countries' industries are moving incredibly fast in AI. And so I think that I think by default, if everything's proprietary, then there's this race underway, which basically says, and it's really right. It's just practically speaking, it's only happening in the US and Europe. And so, sorry, US and China. And so then you basically say that there's a race underway and the stakes are basically what is the world going to run on? Right? And so, you know, what is, you know, eight billion people on the planet, what are they going to use? And it's, and one of the ways to think about it is kind of the 5G Huawei, you know, kind of thing that was in the news a lot, you know, a few years ago. It's like that was the preamble opening salvo of what fundamentally is going to be the AI geopolitical, you know, basically race. Right?

• 12:42Marc Andreessen?

  And fundamentally, you know, tech markets being what they are, in the long run, like, you know, somebody's going to win. And the world, the world will either be running on American AI or be running on Chinese AI. And I think it's very important, you know, which, which, which one wins for a bunch of reasons we could talk about. The open source thing is of course, super fascinating because it's like throws a wrench into, into all of this. And it raises a, you know, a third possibility that like neither, neither the US nor China are going to be the platform. It may just be it's going to be open source. Of course, this is what happened in, you know, specifically in Unix, in operating systems. And then to some extent databases, and of course, you know, the web is open source. And so there, there are a whole bunch of software markets in which the outcome has actually been, you know, open source just wins.

• 13:21Marc Andreessen?

  Like when I, when I was a kid, when I was, you know, the nineties, it was like there was this operating system war between, you know, HP and IBM and graphics and so on. And all these companies to make proprietary Unix and everybody was making a lot of money on proprietary Unix. And then, you know, Linux was a, you know, asteroid strike that just, you know, completely eliminated all profit. And revenue in that industry. And the world benefited, by the way, from Linux and the fact that like everything runs on Linux and it's been a huge turbo boost to every other aspect of the industry. But so, yeah, so like it's entirely possible that happens. And then you go back to the two by two, which is US open source, China open source. The most amazing thing that's happened is China basically pursuing the open source model as aggressively as they are. And there's a lot of theories as to kind of what China's doing here.

• 14:03Marc Andreessen?

  As far as I can tell, DeepSeek was a surprise to kind of China Inc. Like it was, it was, it was not an anointed sort of Chinese industrial, you know, kind of national champion. It was this hedge fund that where the founder basically decided to, to his enormous credit, decided to have his, have his engineers, you know, build, build, build the DeepSeek AI. And so that, that came out of left field and that came out of left field for the US, but I think it also came out of left field in China. And then it, it caused a bunch of the other Chinese companies like Kimi and, by the way, Alibaba and Baidu and Tencent and a bunch of these others to basically, it started this like race in China to like win open source. And then, and then look, there's also American, you know, there's also American open source AI. And so there is, there is this new race underway, you know, from both sides. And it's, it's another thing where I think like how this plays out is going to matter a lot.

• 14:48Marc Andreessen?

  It's extraordinarily hard to predict. You know, I think the people in the big AI labs think that open source can't possibly keep up because of the cost involved. Having said that, again, at least so far up until like this week, you just say that like whatever the American big labs do, like China figures out a way to do it in open source form.

• 15:05Speaker 02

  But they haven't been able to figure out a way to do it technically better because what they're doing is letting American labs invest and then just distilling the models to some degree.

• 15:12Marc Andreessen?

  So I think it's more, there is, there is a distillation.

• 15:14Speaker 02

  And there's infrastructure optimization and a bunch of stuff.

• 15:17Marc Andreessen?

  There's some, for sure, distillation. So there's this thing, distillation, where you basically train the next model on the answers of the previous model. And, and, and I think for sure China is, is doing some of that. And there, there's a, there's a lens on that that says, of course, that's unfair because you're basically piggybacking on top of work other people have done. You know, look, you know, having said that, you know, it's a little bit like, well, okay, there's a fair amount of distillation happening in the US also.

• 15:37Speaker 02

  Yeah.

• 15:38Marc Andreessen?

  Right. Because this, all you need is just be able to ask another AI questions and train on the answers. And then, of course, the AIs themselves are distillations of other content. Right. And, you know, including a lot of, you know, a lot of, a lot of, a lot of published content. And so, you know, I, Yeah, but like you're not saying this, but if someone were to say to me that China is somehow not desert not getting the not getting good results in their program because of using installation, I think that that's not.

• 16:02Speaker 02

  I think they deserve a lot of credit. Yeah, absolutely.

• 16:04Marc Andreessen?

  And then to your point, they're also they're also really good at at least so far. They're really good at optimizing, which means that the thing that everybody the thing that you think is going to cost a gazillion dollars to run, they they, you know, the deep sea comes out and you know, you can run deep sea on home PCs.

• 16:20Speaker 02

  And that optimization is happening largely because of necessity, because of a scarcity of the fastest infrastructure that they have available to them.

• 16:27Marc Andreessen?

  Yeah. So Don in Venture, Don Valentine had this old rule of thumb. He said more startups die of indigestion than starvation in the same, you know, in terms of the amount of money you put in. And his point was like that scarcity does spark ingenuity.

• 16:41Speaker 02

  Yeah.

• 16:42Marc Andreessen?

  And so, yeah, if you can't get the leading edge chips, you figure out how to hyper optimize the older ones. And again, like, by the way, I'm like, this all makes me like tremendously excited by this entire space because it basically says like, right now, it's all everybody's trying to do their best. Like, America's trying to do the best. China's trying to do the best. I definitely want America to win, but China's definitely doing their best. And then the open source thing is working. And then the other, of course, the other part, like the value chain aspect is the open source doesn't have to win in order to basically remove a profit pool.

• 17:10Speaker 02

  That's right. That's right.

• 17:11Marc Andreessen?

  And so, which is what happened originally with Unix.

• 17:14Speaker 02

  And Unix.

• 17:15Marc Andreessen?

  And so, even if open source just has the if open source has the effect not of winning, but of keeping the pricing down, that will be bad for the proprietary lab providers.

• 17:27Speaker 02

  Sure.

• 17:27Marc Andreessen?

  That will be good for everybody else.

• 17:28Speaker 02

  Yeah.

• 17:29Marc Andreessen?

  Right. Because it'll make it'll make, which is what's happening, right? Basically, and if you chart the prices, basically, if you chart the prices of like a model quality, price per model quality, when an open source release comes out, even if it doesn't get significant market share, the price.

• 17:40Speaker 02

  The price just goes.

• 17:41Marc Andreessen?

  Price of that model drops to the inference cost of running the open source alternative. So.

• 17:45Speaker 02

  So now, in all the things that you're exposed to, what's the thing that's blown your mind invention-wise? And said, wow, this is so cool.

• 17:53Speaker 02

  It's completely kind of made you rethink your mental model.

• 17:57Marc Andreessen?

  Yeah, I mean, look, there's like six of those a week right now.

• 18:01Marc Andreessen?

  You know.

• 18:02Speaker 02

  There is a few.

• 18:03Marc Andreessen?

  Yeah, it's just, it's incredible. The capability of the voice UIs, I think, is unbelievable. And particularly the ones where it's like, it's true, it's true, it's true, you know, full duplex, where it really does like, you can like, interact.

• 18:14Speaker 02

  Like what Matty's doing at Eleven Labs.

• 18:16Marc Andreessen?

  Yeah, yeah, yeah. It's just like, I think that's just absolutely amazing. Multimodal, the fact that you can actually talk to, you know, in like, I think both ChatGPT and Grok have this, where, you know, you can turn on your phone camera and you can be, you know, you could be pointing at, you know, it's like, you know, what do you think of my interior decorating? And it will comprehensively like to construct how bad of a job you've done, because it can see your living room, right? Or anything else. By the way, again, immediate medical applications, you know, what's, I have this thing on my skin, like, and immediately it's able to see it, like, that, I think, is spectacular. In the last week, there's this new thing, there's these agents now, like Claude Code, that, and there's this thing called Open Claw, that's an open source agent, and they're kind of, they're amazing. And then there's this thing called MoltBook, which is basically Facebook for AI agents.

• 18:57Speaker 02

  And do you think MoltBook has like a three-week shelf life? Or do you think that this thing is, has consequential kind of implication on how we think about agents?

• 19:06Marc Andreessen?

  So MoltBook, M-O-L-T-B-O, okay. So MoltBook is, it's basically, it's a social network, it's like Facebook, it's a social network, but for AI agents to talk to each other. And it's sort of amazing what's happening. It's highly likely that a significant, it'll blow your mind when you read like the top posts on it, because AI agents talking about all kinds of things. Now, a fair amount of the stuff on it is probably human-written, like, sock puppet, human-written, for people being funny. It's actually really, really amazing. Like, all of the science fiction novels basically have AI either being like, super utopian or super dystopian, but they never have this incredible sense of humor aspect, which is what we're actually getting, where people are just using everything as a fodder for memes. And so MoltBook, MoltBook is like saturated with all of these like incredibly funny memes. It's actually quite unclear which ones are real and which ones aren't.

• 19:50Marc Andreessen?

  The current version of this is, somebody wrote a, somebody wrote an adjacent service for MoltBook called RentAHuman.com, which is a labor marketplace for the AI agents on MoltBook to be able to hire human beings to go out. And there's a, there's an AI agent on MoltBook that has decided to create an AI religion, and at least as of today, it had hired a single human worker to walk the streets of San Francisco and prioritize the new AI religion. Somebody needs to tell the AI agent in San Francisco that doesn't exactly stand out. You need to go a lot more extreme than that. Like, is this real? Is this not real? I torture my friends with this. It's like, is it real? Is it not real? It doesn't even really matter. Like, these ideas are now like in the air. Right?

• 20:32Marc Andreessen?

  And then, by the way, the thing that's happening is that the AI models are now being trained on this content.

• 20:36Speaker 02

  That's right.

• 20:37Marc Andreessen?

  Right? And so even if this AI model, even if the current version of like Claude Code doesn't want to start a religion, the next one is going to want to.

• 20:44Speaker 02

  Who's going to want to?

• 20:44Marc Andreessen?

  Because it's trained on transcripts of discussions of starting new AI religions. And so there's this like incredible feedback loop that's happening where, you know, the level of creativity in the space is just absolutely, is absolutely...

• 20:55Speaker 02

  And the volume's going to balloon up just automatically because of the speed of it just generating content. What do you worry about the most right now?

• 21:02Marc Andreessen?

  I mean, you know, I know you guys talked a lot about, you know, the regulation on the last panel, Chuck and Ann. So, I mean, the biggest concern right now, like, you guys talked about it. I think the regulatory landscape is fairly scary. We were headed in a very bad direction, unfortunately.

• 21:21Speaker 02

  As in overregulation?

• 21:23Marc Andreessen?

  We were headed in a, up until, in the last administration, we're headed towards extreme overregulation, for sure. And up to and including possibly full outlawing of the technology, which is very spooky. In the new world, things are better on that front. But what's happened is the action in the US has now shifted to the states. And so there's now thousands of AI bills in the states, which are all, and many of them are actually quite scary. And so that's, it's become kind of a causal ab for politicians in both parties to kind of go after. And so that's fairly scary. We'll have to see what happens on that. The situation in Europe is quite alarming. And, you know, there's a number of European countries that are, you know, really, really trying hard now to kneecap, you know, I would say, American technology, but more generally, technology. And then, and then they're, they're getting very kind of worked up about AI.

• 22:07Marc Andreessen?

  And then, yeah, look, you know, the other is China, you know, the geopolitical aspect, which is China is in the race. And I, this is better, I would say, the following, what I'm about to say is much better understood today than it was two years ago. But two years ago, I was getting very alarmed because I would go to Washington and I would have two totally different conversations with regulators, politicians. One was a conversation of what are we going to do in the US, in which, and I would be horrified by the proposals that they were making. And then the other was, oh, well, what if China wins instead? And then everybody would kind of switch positions to say, well, of course, that would be even worse. And so therefore, we need to have like really smart policy in the US. And so, but then, you know, they didn't ever really reconcile those two, two different perspectives. I think currently, and actually, I'd say in people, some people in both parties, for

• 22:47Marc Andreessen?

  sure, are, I think, thinking about this much more clearly now. And so, you know, there's, in the US, there's some improvement on the margin. But, you know, China's on it. And, you know, China, and, you know, just like we saw with Five G and Huawei, like China has advantages. You know, we have advantages, but China definitely.

• 23:03Speaker 02

  Who's winning right now?

• 23:04Marc Andreessen?

  I mean, look, the new, the new advances, the new advances in capabilities at the chip level, and at the, and at the model level, and at the app level are coming, you know, mostly from the US. And so, if, you know, if it's a footrace, you know, we're, we're ahead by a bit. But when, when every, when, when everything that happens then, you know, has a, has a version that comes out, you know, two months later, that's either free or, you know, a third of the cost or something like, you know, that's a challenge. And then, you know, China is for sure innovating. And, and, and so, nothing can prevent them from...

• 23:34Speaker 02

  It could be a business model disruption rather than economic disruption, rather than just, you know, technological disruption.

• 23:40Marc Andreessen?

  Yeah, exactly. And then, you know, this even comes up with like chip policy. And I, you know, we're not, we're not really, we're not really active in, in chips that much. But, you know, there's this argument, goes back to what you said about China optimizing because they can't get, if they can't get access to the advanced chips. There's, you know, there's an argument on the policy side to hold back on, you know, basically prevent export of, of cutting edge American chip to China to deny them those capabilities. But on, on the other side of that, there's an argument that if you do that, you then motivate them more to create their own chip ecosystem, which they are definitely doing. Right, and so you, and they have a whole national program to build up a competitive chip industry and then ultimately leapfrog us. And so that's a really, really, really big deal. And then, and then to kind of go back to earlier topic, like if the world runs an American AI, like the world may not be perfect, but like generally speaking, you know, America

• 24:25Marc Andreessen?

  may not be perfect, but like generally speaking, AI is going to be, you know.

• 24:29Speaker 02

  IP will be respected, privacy will be protected, you know, you'll have.

• 24:32Marc Andreessen?

  You'll have the values that we're used to.

• 24:34Speaker 02

  Yeah.

• 24:35Marc Andreessen?

  If the world runs a Chinese AI, not so much. You can actually see this today. So when like DeepSeek and these companies put out their AI models, you know, they put out this paper where they show all the, you know, American companies do this too. They run all these tests to try to figure out how good the model is. And China has, you know, these additional kind of line items for the test, which is, you know, Marxism and then, you know, Xi Jinping thought, right? And it turns out the Chinese models are really good at Marxism and Xi Jinping thought. And, you know, I don't know about you, but I want my grandkids educated by the other kind of model.

• 25:09Speaker 02

  Other kind of model. I wish we had another 45 minutes to go through with you. Will you come back?

• 25:15Marc Andreessen?

  Yes, 100%.

• 25:16Speaker 02

  Awesome. Mark and Jason.

• 25:18Marc Andreessen?

  Thanks, folks.

• 25:22Speaker 01

  Thanks for listening to this episode of the A16Z Podcast. If you liked this episode, be sure to like, comment, subscribe, leave us a rating or a review, and share it with your friends and family. For more episodes, go to YouTube, Apple Podcasts, and Spotify. Follow us on X at A16Z and subscribe to our Substack at A16Z.substack.com. Thanks again for listening, and I'll see you in the next episode. This information is for educational purposes only and is not a recommendation to buy, hold, or sell any investment or financial product. This podcast has been produced by a third party and may include paid promotional advertisements, other company references, and individuals unaffiliated with A16Z. Such advertisements, companies, and individuals are not endorsed by AH Capital Management

• 26:06Speaker 01

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