America Needs Defense, Meta Sales Soar, Sam Altman's New Bet, Masa's Big Raise

TBPN.com is made possible by: Ramp - https://ramp.com Eight Sleep - https://eightsleep.com/tbpn Wander - https://wander.com/tbpn Public - https://public.com AdQuick - https://adquick.com Bezel - https://getbezel.com Polymarket - https://polymarket.com Follow TBPN: https://TBPN.com https://x.com/tbpn https://podcasts.apple.com/us/podcast/technology-brothers/id1772360235 https://youtube.com/@technologybrotherspod?si=lpk53xTE9WBEcIjV (02:56) - Nucleus Series A (13:31) - America Needs Better Defense Acquisition (39:32) - Castelion Size Gong (59:56) - Masa's Big Raise (01:13:55) - Sam Altman Backs Reto Biosciences (01:20:23) - Meta Sales Soar (01:30:20) - Snowflake to Aquire Red Panda? (01:38:59) - Seagate (01:47:37) - The Timeline

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. There's been a terrible tragedy in DC. There was a plane that crashed into a helicopter last night and was really terrifying.

• 0:11Jordi Hays?

  That is a rough, uh, rough start to the pod.

• 0:14John Coogan?

  Yeah.

• 0:15Jordi Hays?

  But, uh, needs to be said.

• 0:17John Coogan?

  Yeah.

• 0:17Jordi Hays?

  Rest in peace.

• 0:18John Coogan?

  It's always terrible when these like, you know, crises unfold because, I mean, we saw this with the, with the LA fires, like every possible take is enumerated very quickly.

• 0:29Jordi Hays?

  Yeah.

• 0:29John Coogan?

  So you'll just see like, the right will say it's because of DEI at American Airlines. The left will say it's because of capitalism. The conspiracy theorists will say it was a CIA.

• 0:38Jordi Hays?

  Who was on that plane?

• 0:39John Coogan?

  Yeah, CIA operation or

• 0:42Jordi Hays?

  Yeah.

• 0:42John Coogan?

  The, the warhawks will say it was China and who knows, but it doesn't feel like living in a first world country to me. And it's very disappointing and I hope that the, the worst outcome is the one where there's a huge culture war. Everyone battles about it. Everyone gets really angry at each other and then everyone completely forgets.

• 0:59Jordi Hays?

  Yeah.

• 0:59John Coogan?

  And then nothing actually gets changed because clearly whatever happened, happened like the, the solution that will stop that is not something that can be implemented in an hour. It's going to be a lot of different things.

• 1:11Jordi Hays?

  The positive thing here is there's, there's so much data that's produced.

• 1:14John Coogan?

  Yeah.

• 1:15Jordi Hays?

  From the event.

• 1:15John Coogan?

  Yeah.

• 1:16Jordi Hays?

  The, the flight logs, the, uh, you know, the radio traffic of air traffic control during the event. And so we actually, it's not like a lot of other sort of dramatic crises, you know, events where we may not ever know kind of what actually happened.

• 1:32John Coogan?

  Oh yeah, we know.

• 1:33Jordi Hays?

  Be able to figure it out.

• 1:34John Coogan?

  Totally, totally.

• 1:35Jordi Hays?

  And so there's not, there shouldn't be that rush to, you know, generate new conspiracy theories, spread misinformation, make it a social issue. Or, you know, some type of

• 1:45John Coogan?

  Like clearly something went wrong. Clearly there's a solution, but it's going to take a lot of political will and a lot of energy and a lot of hard work and a lot of technology to actually implement that. And it's not going to be done in a day or a week. It's going to be done in a number of years.

• 1:58Jordi Hays?

  The other thing is I don't think anybody.

• 2:02Jordi Hays?

  Like last week was saying, "Commercial aviation is super dangerous."

• 2:06John Coogan?

  Totally.

• 2:07Jordi Hays?

  It's actually statistically

• 2:08John Coogan?

  Oh, yeah.

• 2:08Jordi Hays?

  A super safe way to travel.

• 2:10John Coogan?

  It had been 15 years since there was a commercial airline crash in America, and this was the deadliest crash since 9/11.

• 2:17Jordi Hays?

  Wow.

• 2:17John Coogan?

  Insane. And yeah, I mean,

• 2:19Jordi Hays?

  It's terrible.

• 2:19John Coogan?

  Also, you always run the risk of like, it's almost like a black swan event. It's like an event that you're not really prepared for. Like, after the fire, after the fire in LA, a lot of people were saying like, "Oh, well, I gotta rebuild my house in like, concrete and brick." And it's like, well, what happens if an earthquake comes then? So, so you really need to balance out all the possible risk factors, but like, we gotta do more here. But fortunately, there's lots of good news. There's lots of interesting tech news right now. And we'll start with a fantastic piece of news from my buddy Kian Sadegi. I am gonna butcher your name, I'm sorry, but he announced-

• 2:55Jordi Hays?

  Just call him Bud.

• 2:56John Coogan?

  Yeah, Bud. Kian announced a $14 million Series A with participation from Founder Fund, 776, Neo, Bology, Serena Vossen, Giant Step VC, 1-8 Capital, and many others. "We're going to make preventable diseases a thing of the past." So I think we gotta hit the size gong for Kian.

• 3:14Jordi Hays?

  Boom.

• 3:15John Coogan?

  Congratulations on your $14 million Series A.

• 3:19Jordi Hays?

  Nice work.

• 3:20John Coogan?

  We have some posts from him, and we also have a little bit of his blog post. He said, "Five years after founding Nucleus in my bedroom, I'm thrilled to share that we've raised a $14 million Series A. Our current roadmap is ambitious, including dramatically expanding genetic risk assessments." So you can think of them as kind of like, the next generation 23andMe. They send you a kit, they get you full sequence of your DNA.

• 3:40Jordi Hays?

  More focused on helping people use the data to be proactive versus the novelty of being like, "Oh, I have 1% Irish."

• 3:49John Coogan?

  Yeah, exactly. Or half a percent Native American.

• 3:53Jordi Hays?

  Yeah.

• 3:54John Coogan?

  And also, it's just a fundamentally different technology that goes into how they sequence the genome. So- 23andMe, I believe, does something called shotgun sequencing, where they kind of blast a bunch of the DNA out and then they kind of sample it. And statistically, they get you to like 90% there, but it's not a full sequence. The full sequence is something that does happen in scientific labs for more rigorous scientific studies, but Nucleus has been able to take that next generation technology and bring it to the consumer market so that you can just go order a kit and get your exact genome.

• 4:26Jordi Hays?

  And this came at a good time because I feel like people lost a huge amount of trust in 23andMe and some of these sites because they struggled as businesses and then they started changing hands from an ownership standpoint and looking at, you know, looking at like they were potential takeover targets. And the challenge there is you're looking at this and if you've given all your genetic data to a company, you actually start to care who owns that business, what are their intentions with that data?

• 4:54John Coogan?

  So a bit of a call to action to people, if you did 23andMe, you can go and export your data and then you can have them delete it from their servers and they will do that. And I do believe that they will, that they are capable of doing that. And then, and then if it does get taken over by someone who maybe you don't want to have that data with, you're, you won't be in the database anymore, which I think is probably the right thing to do at this point.

• 5:15Jordi Hays?

  Yeah, and they also had a massive pickup. He says in the post, "I'm thrilled to announce that Matt Lantner, a former co-founder of OpenStore, Chief of Staff at Founders Fund and longtime Nucleus investor, is joining as president. His decades of experience helping scale billion-dollar companies will be a tremendous addition to an already deeply talented team." And I gotta say, there is nothing more bullish than somebody like, I don't know Matt personally, but when somebody like Matt, who is deeply, deeply connected in the venture world, has started their own companies and they could, there's hundreds of companies that they could go and join or a bunch of different companies that they could start. If they're choosing to join your company at an inflection point like this, it's the most bullish signal.

• 5:58Jordi Hays?

  Matt has a quote here, he said, "My time working with Keith Rubeau at Founders Fund was a masterclass in identifying exceptional founders. That experience, combined with countless founder meetings as an angel investor, helped me recognize something special when I first met Keian.

• 6:12Jordi Hays?

  I was immediately struck by qualities I'd seen only in the most successful founders, a deep personal obsession with the problem and the relentless drive to pursue it." Couldn't be more bullish for the nuclear team.

• 6:22John Coogan?

  Yeah.

• 6:23Jordi Hays?

  Congrats on.

• 6:23John Coogan?

  The first time I met

• 6:24Jordi Hays?

  The Nucleus team.

• 6:25John Coogan?

  in Manhattan, I got coffee with him in the small coffee shop and we just had the most intense discussion for like an hour, going back and forth about like how this would affect things and what the value of and, you know, could, could you get something out of it? Cause I think the, the, my, my disappointment with 23andme was always like, it was kind of a nothing burger. Like you do it and it tells you like, oh yeah, like, you know, heart disease and cancer are probably going to be what get you. And it's like, I kind of already know that just from like the math statistics. It doesn't tell me anything specific. And so he made a very, a very strong case for finding those, those niche preventable diseases and just eliminating all those risks, which was cool.

• 7:02Jordi Hays?

  And so there's even more news in here.

• 7:04John Coogan?

  Oh, yeah.

• 7:05Jordi Hays?

  You guys, I'm also excited to announce Nucleus has acquired Cambrian, an AI-based health platform pioneering algorithms to transform data from wearables like Oura Rings and Apple Watches into actionable recommendations. We're excited to welcome the founder, David Sloan, to our product team where he'll spearhead wider data integrations. And this is insane and awesome. My only critique of this announcement is you, you've already included like three major announcements, which is your fundraising round. They're also growing 68% month over month.

• 7:34John Coogan?

  Yep.

• 7:34Jordi Hays?

  They're adding this like crazy new exec to the team.

• 7:37John Coogan?

  Yep.

• 7:37Jordi Hays?

  And they did an acquisition and they could have spaced that out over four weeks and had like big news, you know?

• 7:44John Coogan?

  Yeah.

• 7:44Jordi Hays?

  Constantly.

• 7:45John Coogan?

  I mean, Tion's doing pretty well at going direct. He has a podcast and he posts a lot and we'll go in through some of his posts, but, uh, I mean, they have been on an absolute tear. In the last three months, they've averaged 68% month over month revenue growth. Since November, uh, monthly users have tripled and less than a year after going live, we've scaled up from 10 genetic analyses to over 800. So it took him four years to get this live. He was in his bedroom, just kind of grinding on this, figuring out what technology he needed and, uh, finally got it live. And then they've done a bunch of crazy things that everyone in, in Silicon Valley have been like, Why are you doing that? Like they sponsored the Jake Paul fight? Did you see this? So like when the cut man comes into like, I think it was a Jake Paul fight. They it's like it's some like, you know, not super prestigious type of event, you know, it's not.

• 8:29Jordi Hays?

  But that's the mass market.

• 8:30John Coogan?

  But it's the mass market.

• 8:31Jordi Hays?

  Companies are built.

• 8:32John Coogan?

  And everyone was like, why, why is he doing this? This is like so silly. But I, I looked at the data and I think it penciled out really well for that.

• 8:38Jordi Hays?

  That's cool.

• 8:39John Coogan?

  It was just a great.

• 8:39Jordi Hays?

  Yeah. The, uh, there's a good quote in here relevant to this because, uh, you know, this is a now a hyped venture backed company, but to become a, you know, multi billion dollar business and potentially a trillion dollar business, which Alexis will get into here, you have to be able to hit that mainstream of if you're building a consumer product, you should probably at some point be able to advertise at a boxing match.

• 9:01John Coogan?

  Or NASCAR race or something. And if you never cross that chasm and you're only cool with the tech people, you can, you can ladder up the venture rounds pretty well. You can even SPAC. We've seen this with like the all birds and stuff that never really broke into the mainstream. But my first company never really crossed the chasm into like the main mainstream. And, uh, and, and so thinking about that earlier in this, in the company history, and kind of biting the bullet on like, yeah, your brand might be not seen as like the hottest thing in tech, but that's actually a bigger opportunity.

• 9:30Jordi Hays?

  Yeah. So one of the, um, I believe it's a co-lead in the round, Alexis Ohanian, he says, they say the next one trillion dollar business is going to be in consumer health. I buy it. If you look at the landscape today, there's really no one else on the market building the way Kion and Nucleus are. Nucleus is running a playbook in healthcare that used to belong only to purely software companies. It's fascinating to watch.

• 9:52John Coogan?

  Yeah.

• 9:52Jordi Hays?

  So very cool.

• 9:53John Coogan?

  And so we, yeah, we actually mentioned this in that, uh, in that Nvidia article that we read, um, talking about how, you know, there's this data wall, we're running out of data and there is a lot of genomic data and maybe that has a, has a role in AI. And, and I think that's what Kian is betting on is let's, let's, let's put in a massive amount of, of genetic data and, and then run these next generation algorithms over there. So it's not just that the hardware got better, the Luminar system, I think is one of them that can actually sequence more genomic data.

• 10:26Jordi Hays?

  Yeah.

• 10:26John Coogan?

  It's, it's get all of that into the database and then be able to run more advanced algorithms with AI on top of it. So very bullish, but Kian has had some banger posts over the last few years. On September 9th, 2024, he said, "Our revenue yesterday, we are absolutely cooking. The movement is getting bigger every day."

• 10:44Jordi Hays?

  Looks like a meme coin chart.

• 10:46John Coogan?

  Yeah, it does. Is this pumped out fun, Kian? What's going on here? Can you believe we haven't even gotten started yet? Oh, my God. Future of Health Tech at Nucleus Genomics. I like that.

• 10:56Jordi Hays?

  Let's go.

• 10:57John Coogan?

  Just sharing the Stripe dashboard. We love to see it. This is a fun one. Related to 23andMe in September 20th, 2024. "Today, I'm announcing that Nucleus Genomics is considering the possibility of making a public offer to acquire 23andMe contingent on financing, as well as initiating and executing a successful negotiation."

• 11:17Jordi Hays?

  That's such an amazing play, even at a high level. To just show the kind of game you're playing to go to find the most high-profile company in your category and say, "Yeah, we're exploring an acquisition of the company."

• 11:36John Coogan?

  Yeah, exactly.

• 11:37Jordi Hays?

  Even if it's not a super serious thing. In many ways, I'm sure that Kian and the Nucleus team would be able to much better operate and take advantage of the customer relationships and the data.

• 11:49John Coogan?

  And it just comes down to the price. I mean, they're already making acquisitions. They got 14 million right now. I think they'd probably need...

• 11:55Jordi Hays?

  32 million total.

• 11:56John Coogan?

  Yeah, I think they'd probably need like over 100 to do the deal, even if there was debt involved. I don't know how 23andMe operates as a business, but it's still just kind of cool. And there's this trend of like, you know, when TikTok was up and people were talking about like perplexity was jumping on the hand, maybe we'll buy it, maybe Mr. Beast will buy it. A lot of people were circling and at least kind of kicking the tires.

• 12:15Jordi Hays?

  Yeah, this is a part of a broader trend we're seeing in venture right now where venture capitalists and founders are starting to think more like traditional private equity. Looking at rollups becoming popular, but also, you know, this sort of larger scale M&A mergers.

• 12:30John Coogan?

  And this is really cool. Dwarash, obviously one of the most respected figures in tech right now, had an amazing story. So Kian posts, "Wow, Dwarash Patel had an amazing story on his concern about his family history for prostate cancer, and so he exported his 23andMe..." 23andMe data to Nucleus Genomics to find out how he was in the 97th percentile for his genetic risk. He now knows to get earlier screening for this. And so this is an example of just the the software, the application layer in AI being valuable. He didn't even have to do a test with Nucleus. He was able to just take his 23andMe data, and I'm sure the quality of that analysis goes even goes up if you actually do the full test with Nucleus. So

• 13:15John Coogan?

  congrats to Kian and the Nucleus team. We love to see it. And good luck with the next 12 to 18 months until you raise again.

• 13:23Jordi Hays?

  Try to keep up that 68% month-over-month growth.

• 13:26John Coogan?

  Yep.

• 13:26Jordi Hays?

  And soon your GDP will be, your revenue will be bigger than the GDP of France.

• 13:30John Coogan?

  There you go. There you go. Well, let's move on to a fantastic article in Pirate Wires. We love to read these these deep dives on this one's by Joe Lonsdale and John Noonan says, "America Needs Better Defense Acquisition: How Trump Can Seize the Moment, Learn From What Worked and What Didn't in His First Administration, and Make Generational Changes to Defense Bureaucracy." And so during the rebellion in the Philippines a century ago, American soldiers found that their service pistols lacked stopping power and were inadequate for the harsh realities of jungle warfare. In response, army leaders drafted a simple request for a new semi-automatic pistol of at least 45 caliber to replace the service's

• 14:12John Coogan?

  aging revolvers. This was a big thing in Vietnam. I feel like that was the dawn of like the 556 round, and a lot of guys would carry Thompson submachine guns that were 45 caliber, just because it would cut through all the brush and the bullets wouldn't get scattered as much. And so a lot of guys kind of like procuring their own weapons. And this is something that's happened in the military for a long time, like their family will send them bulletproof vests.

• 14:37Jordi Hays?

  Yeah, this is why the work that founders are doing in defense tech now. Is so serious. There's a lot of memes. You know, we've, we've, we've talked, you know, memed about gundo and bear domestication and stuff like that. But when you're developing these products, if you have bugs or errors, or they're not set up properly for the task, you're putting American lives on the line. And these soldiers, you know, back in this situation are finding out that their, you know, pistols don't have stopping power, which means that they're actively getting into conflicts, like, you know, eye to eye with basically the enemy and not being successful with the products.

• 15:15John Coogan?

  Yeah. And so six firearm manufacturers answered the call. Their pistols were put through a series of rigorous field tests. The sidearms were refined iteratively throughout the assessment. In the final test, several thousand rounds were put through each gun over 48 hours. That must've been fun. The Army was pleased to discover that one of the six prototypes, the Colt, suffered no malfunctions over two days of intense use. In early spring 1911, the, oh, this was actually during the Philippines war. This was before Vietnam, actually. Had that wrong. In early spring 1911, the Army settled on the Colt's 45 caliber as the new sidearm of choice for the service. Nearly 3 million Colt 1911s were made. The Colt 1911 served soldiers across two world wars, Korea and, and I guess

• 15:56John Coogan?

  Vietnam as well, eventually being replaced in 1985. It was a procurement victory for the ages and the result of a competitive process that spoke for itself. To say that the Army's attempt to build a new pistol in the 21st century has gone poorly would be a gross understatement. The Army's effort to buy a new handgun has already taken 10 years and pursued, produced nothing more than 30, 350 pages of requirements, said the late Senator John McCain in 2015. Micromanaging extremely small, unimportant details and Byzantine rules and processes the Army's once followed, many of which are unnecessary or anti-competitive. And so procurement is a mess. Pirate Wires summarizes this by

• 16:37John Coogan?

  saying, "The Pentagon purchases more goods, services, and software than all other federal agencies combined, but an ideology of central planning has rendered it ineffective." And here's how the Trump administration can make generational changes. And so Joe and his co-author John go on to write, "Change is coming. The DOD bureaucracy, like all bureaucracies, seeks to sustain and grow itself. Each new inefficiency, like the service pistol mess, prompts shock from Congress. Then to fix the inefficiency, the bureaucracy creates more inefficiency."

• 17:12Jordi Hays?

  We're gonna need a new report.

• 17:13John Coogan?

  Yeah, yeah, exactly. This is something I'm worried about.

• 17:15Jordi Hays?

  The report generates a need for new analysis, an investigation, and a new report. And then you're back.

• 17:21John Coogan?

  Yep.

• 17:22Jordi Hays?

  And it's a cycle of just information collection versus action.

• 17:26John Coogan?

  Yeah, it's very, very rough. Like, yeah, you're overregulated. You have a problem and the answer is more regulation.

• 17:32Jordi Hays?

  It should be, it should be the same. It's funny because this initial process, which is, hey, we're gonna give six manufacturers the opportunity to produce a next-generation firearm.

• 17:41John Coogan?

  Yep.

• 17:41Jordi Hays?

  We're gonna put them through 48 hours of intensive testing.

• 17:45John Coogan?

  Yep.

• 17:45Jordi Hays?

  That's exactly what, you know, and this, this actually is, might be surprising to some people, but they're, you know, if you ever are going to shop and buying a gun, oftentimes a Glock will get recommended due to its sort of rugged reliability. And so if you put 10,000 rounds through a Glock and it's been well-maintained or serviced, you're gonna have very little sort of errors with it. But there's a lot of manufacturers that are actively selling products where it's one out of every 100 rounds, you know, has, you know, that you go through, you have some type of error or it gets jammed or it's, you know, has some type of issue. And that's the last thing you want. It's okay if you open Apple Intelligence and it's telling you something completely inaccurate about a message that you got.

• 18:29Jordi Hays?

  If you're relying on a handgun in a defensive, you know, scenario and it's, has a 1% error rate, that just doesn't really work.

• 18:37John Coogan?

  Yeah. And so in 2018, the Pentagon underwent a significant restructuring of its acquisition framework. It resulted in the creation of a near, of nearly a dozen new offices. The creation of the DIU, a lean and nimble group based in Silicon Valley with the authority to fund new products, is a bright spot, but the temptation to create new bureaucratic edifices is part of the problem. In the defense world, the Pentagon is the only domestic customer. And so The defense industry is not subject to the same demand forces as the rest of the economy. Programs that wouldn't survive an open competition can thrive if the Pentagon wants them to. Superior products can struggle to break through and are at the mercy of opaque processes. When the Army was searching for a new pistol a century ago, it simply told the best arms manufacturers in the world to build them a pistol,

• 19:21John Coogan?

  then it tested them in a ruthless competition. Today, Pentagon officials write long lists of requirements, many of them strange and unnecessary, take years to solicit and evaluate proposals. Even when the Pentagon does hold competitions, there is a clear winner that is ordered.

• 19:35Jordi Hays?

  This is for the most simple, this is a multi-hundred-year-old product, right? The pistol. And so imagine when you're testing and trying to sell and create and earn the Pentagon as a customer if you're building drone defense, you know, mechanism of sorts, right? Like, imagine the complexity there when you have this emergent threat, new technology, and they can't even figure out how to acquire a new handgun for, you know, like, service pistol.

• 20:00John Coogan?

  Yeah, and so Joe Lonsdale wrote on X, VP JD Vance mentioned the crisis of broken defense procurement twice in today's interview. Cool. I drew up notes on how to fix it based on my 20-year experience as a defense entrepreneur and investor. With leaders like Pete Hegseth, we've got a real shot at change. Link below. And so Joe's been working on this for a while. And there are lots of people in tech and defense tech that have been talking about this for a while. Back in 2023, November 24th, Ryan McIntosh over at Andreessen said, "One of the biggest bottlenecks for defense startups is DoD contracting. Imagine a tech-enabled private military company that they could sell to instead circumventing government procurement and ops.

• 20:45John Coogan?

  Contracts for mission outcomes, not products delivered. Defense as a service." Kind of a, like, the most futuristic possible outcome. But, I mean, there's certainly an element of that with the private military contractors that buy sometimes civilian weapons even.

• 20:59Jordi Hays?

  We have a mutual friend that's been working on a PMC for a while.

• 21:03John Coogan?

  Yeah. And so Joe goes on to say, his friend Shamsankar over at Palantir has bemoaned what he calls a government defense monopsony, where one buyer gets too comfortable and exercises illogical and inefficient decision making in his Martin Luther inspired Defense Reformation. Shams brilliantly lays out a strategy to end the Pentagon monopsony and flip the military to be a better customer. One of my favorite proposals in this space is to stop identifying the Pentagon as a single entity. It is, rather, an umbrella for dozens of service branches, agencies and sub-agencies. The thinking is that Congress and the President puts these smaller agencies into competition with each other for money and contracts. It would not work across the entire DOD, but putting just a few head to head would be

• 21:47John Coogan?

  a strong blow against the 1950s mandate of efficiency via consolidation and a single difficult top-down buyer.

• 21:53Jordi Hays?

  It's funny, efficiency via consolidation sounds like a Soviet-era policy.

• 21:58John Coogan?

  It does.

• 21:58Jordi Hays?

  Doesn't sound very capitalist.

• 22:00John Coogan?

  We felt for the meme in the 50s or something.

• 22:02Jordi Hays?

  Yeah, and it's interesting, one of the dynamics here is that defense manufacturers need to sponsor NASCAR events. They need to buy out of home. We were talking with the AdQuick team yesterday and they were showing us a billboard that Anduril's running in DC, right? So they're basically having to do wide-scale consumer advertising to build this sort of brand love, presumably, or mind share in a place like DC.

• 22:29John Coogan?

  Totally.

• 22:29Jordi Hays?

  When, in theory, a defense contractor shouldn't have to be doing consumer marketing to get their products, you know, purchased by our government, right? It should be the best, you know, suite or individual product that sort of wins, but instead, you know, you'd see an advertisement for Ozempic next to an advertisement for a submarine.

• 22:49John Coogan?

  Yeah, I remember seeing, I think it was Anduril ads at Burbank Airport. And yeah, all of that's just to, you know, target lawmakers that are flying back and forth between LA and probably Sacramento.

• 23:01Jordi Hays?

  Yeah.

• 23:02John Coogan?

  And so there's another promising proposal, he highlights, to create mission-based requirements. The Pentagon has a term called requirements creep, where a simple commercially available solution to a problem becomes infected by new design obligations imposed on industry by military officials. The US Navy's Constellation-class frigate, for example, was meant to be a fast and simple purchase of a proven and existing warship. The Frem frigate made by Finn Cantary.

• 23:29John Coogan?

  And what was a clear edict from Congress to buy quick and off the shelf Navy bureaucrats have reduced the constellation's design commonality with the original FREM from approximately 85%. So they're like, let's just change 15% of it to now it's less than 15%. So it's 85% different requirement after requirement. Some dating back decades have resulted in massive cost overruns and delays to the program. As a result, the Navy still does not have a frigate in service. It's just like, oh my God. When the Pentagon believes it can do acquisition via central planning more effectively than listening to soldiers or technologists, it fails our country.

• 24:05Jordi Hays?

  Again, central planning, all these phrases that feel.

• 24:08John Coogan?

  It's rough. It's rough. And so, I mean, this is all part of like this major vibe shift in tech and defense tech. There's a post from Dan Primack here from November 29th of 2024. He says, "One big reason that VCs didn't use to fund defense tech was that they didn't want to invest in things that were reliant on government procurement. Yes, there were philosophical issues too, but this was an era when VCs avoided startups that even brushed up against government or regulation minus biotech. That time has long passed, in part because Uber, Lyft, SpaceX, and Airbnb kicked down the doors." And so, yeah, it's interesting. I hadn't really thought about Uber and Lyft and Airbnb as precursors to the andurals

• 24:49John Coogan?

  of the era, but there is a little bit of that where there was a shift in entrepreneurship where founders figured out that some of these things aren't insurmountable.

• 24:58Jordi Hays?

  Well, a lot of the lowest hanging fruit of, you know, CRM and email tools and things like that.

• 25:03John Coogan?

  So you gotta do the harder, the harder thing.

• 25:04Jordi Hays?

  Yeah. And you had a generation of entrepreneurs who did the easy things, right? And then they realized that there were bigger challenges and bigger opportunities doing the hard stuff. Now that, now that they had the sort of base level abilities around capital raising, software, you know, these sort of generalized skillsets.

• 25:23John Coogan?

  This is a crazy stat. Since the end of the Cold War, over 2,500 US companies have been founded and reached a valuation of a billion dollars or more. So 2,500 unicorns in the US since the Cold War. Less than a dozen have been in defense. And I mean, hopefully we'll be covering more here soon, but I personally founded a few and invested early in a few more, Joe, than like every defense.

• 25:47Jordi Hays?

  Not just in them, but.

• 25:48John Coogan?

  Founded, yeah. In many areas, these companies are out competing the primes if they're allowed to. They represent thousands of manufacturing jobs in the US and could have put a multiple of that in the next decade. But they need allies in the government. New officials can start by trimming down an encyclopedia of regulations that was first written and consolidated in the Reagan administration. The federal acquisition regulation, F A R, first issued on April 1st. That's funny. April Fool's Day.

• 26:16Jordi Hays?

  April Fool's.

• 26:17John Coogan?

  1984, also a weird year. Very dystopian. It has almost doubled in length and with it, the complexity.

• 26:24Jordi Hays?

  Maybe it was always meant to be a joke.

• 26:26John Coogan?

  It was a joke and it was meant to be dystopian.

• 26:28Jordi Hays?

  And then nobody got the joke and they just let it roll.

• 26:30John Coogan?

  Yeah. Disregarded entirely. Title 10 of the US Code, which governs the armed forces, has become swollen with obsolete and choking legal requirements. This creates fertile grounds for long and contentious lawfare when bids don't go a company's way. And so the story of every defense tech company has been make a better product, get it, you know, loved by the military and the warfighters on the ground. And then essentially you have to fight a lawsuit when you get screwed in the defense procurement acquisition.

• 27:00Jordi Hays?

  Well, this is why a bunch of the, there's this narrative that all the new defense tech founders are in the gundo, but two of the companies in my portfolio, deterrence and Allen Control Systems, both the CEOs live in Washington DC, right? So, and they, the opportunity for them is that every lunch and coffee and things like that can get them closer and closer to real traction.

• 27:24John Coogan?

  Yeah. And, uh, yeah, I think SpaceX and Palantir both had to sue the government when, uh, when contracts didn't go their way and they felt like they were, uh, unduly looked over.

• 27:35Jordi Hays?

  Yeah, cause it's hyper political. There's a lot, there's, you know, massive lobbying.

• 27:39John Coogan?

  Totally.

• 27:40Jordi Hays?

  If you're Lockheed Martin and you like your, you know.

• 27:43John Coogan?

  Margins.

• 27:43Jordi Hays?

  Duopoly or whatever, you're going to just continue to spend to make sure that, uh, things aren't necessarily always.

• 27:50John Coogan?

  This is a great quote in here. The United States was once the arsenal of democracy. Today it is the arsenal of bureaucracy. With an army of federal civilians making it difficult for American companies to sell to willing buyers. To wit, it took the State Department and the Pentagon nearly thirty months to finalize the sale of Harpoon anti-ship missiles to Taiwan. Though upgraded in recent years, the Harpoon has been in service since the eighties. It's not a new system, and Taiwan is the nexus of our Pacific deterrence. We have a unique opportunity for American workers and innovation to be fueled by investment from our friends, strengthening both our economy and national security. The process should be simple. It isn't. The haft of the arrow in America's side was feathered from our plume. That's a great sentence.

• 28:33Jordi Hays?

  Great writer. Writers.

• 28:35John Coogan?

  Fantastic. Moreover, the past three decades of obsessive consolidating and regulating and subsidizing has undercut the core element of the new administration's foreign policy and national security. Trump has rightly emphasized deterrence, a concept that escaped the outgoing president and his team. Deterrence is a simple framework and does not require a mountain of PhDs to grasp. It means in plain terms terrifying adversaries with a combination of iron-forged national will and fearsome weapons that lend that patriotic resolve credibility. It's great.

• 29:08Jordi Hays?

  Yeah, one, I posted a couple of weeks ago that we needed a, like, Project Stargate style progress, project to address the shortage of domestic drone production. And when you read this article and you understand how long it takes just to sell a single, you know, Harpoon

• 29:25John Coogan?

  Yeah, yeah.

• 29:26Jordi Hays?

  To, what is it?

• 29:28John Coogan?

  I mean, no one's talking about Taiwan invading China, because, like, China is extremely scary when it comes to deterrence. It's like they have all this incredible military technology. It's unthinkable.

• 29:40Jordi Hays?

  Yeah, and so I think part of it is getting, getting Peter, people like Pete, hedge this back. In, you know, effectively in power and helping make some of these decisions. People that have actually experienced conflict.

• 29:54John Coogan?

  Yep.

• 29:55Jordi Hays?

  And getting some of these decisions back into the hands of not bureaucrats, but actual operators that have on the ground experience.

• 30:02John Coogan?

  Yeah, it's pretty cool looking at who's in now. So Pete Hegseth said during his confirmation hearing, "Competition, it's important, critically important. Silicon Valley, for the first time in generations, has shown a willingness, desire and capability to bring its best technologies to bear at the Pentagon, a Pentagon that has become too insular in ties and tries to block new technologies from coming in." And then Steven Feinberg, the nominee to be the number two at the Pentagon, is a patriot who leveraged his vast business experience. He's more of a private equity guy, but has done a lot of defense deals.

• 30:31Jordi Hays?

  Yeah.

• 30:32John Coogan?

  I think it's Cerberus, right? And then Emile Michael also went into the administration as well, and he was the right-hand man of Travis Kalanick at Uber and just a great overall guy.

• 30:43Jordi Hays?

  And we want that Uber energy, that TK energy in the Pentagon and running research and engineering.

• 30:50John Coogan?

  Totally.

• 30:50Jordi Hays?

  That is, that is cool.

• 30:53John Coogan?

  During, so he closes with, "During the Persian Gulf War, the stunning American military victory over the Iraqis, then a fourth, then the fourth largest army in the world. Military experts estimated that US military technology was a decade ahead of the Soviets and two decades ahead of the Chinese. The world was shocked at the might of then futuristic weapons and state-of-the-art tactics. The new Trump team has strong, has a strong wind in its sail. The woke tech giants of the last decade have given way to a new crop of patriotic leaders and innovators. Silicon Valley is poised and ready to join the fight. With a few bold moves, President Trump's promised golden age and a second century of American dominance are within reach." I love it. So go subscribe to Pirate Wires, read the full piece and follow Joe on X.

• 31:38John Coogan?

  And let's go to some other posts loosely about defense procurement. So Josh Wolfe wrote, "US Defense Tech CEOs urge speedier procurement to counter China." This was from months ago, and everyone has been beating the drum on, "We need to speed up defense procurement." It's boring, but it's very important.

• 31:57Jordi Hays?

  Yeah, and it puts our companies at risk. If you have a startup and you've developed this incredible product, and then you have one customer, which is the Pentagon, and they're like, okay, we're excited about this, but you know, let's start the process. And then it turns into a

• 32:10John Coogan?

  Let's change this, let's change that.

• 32:11Jordi Hays?

  48-month process. Meanwhile, you have $2 million in payroll costs that you're having to absorb every month because you need the best engineers and talent in the world to run your business. But then you're just waiting for that revenue to hit. And usually it comes in increments where, you know, that you get awarded 10 million bucks, and then you need to hit certain milestones. And so it's a very sort of shaky dynamic that has led to otherwise good technology not getting implemented.

• 32:41John Coogan?

  Yeah. And so even back during the Biden administration, there was an open letter that was signed by Palantir, Anduril, Lux Capital, and others. And they went to meet with the Biden administration, the House GOP, to work on defense procurement. Obviously less relevant now that Biden's out, but still, this is something that's obviously bipartisan and has always been. Patrick Collison had an interesting post here. He took a very academic approach to thinking about defense procurement back in 2017. Says, "Military procurement turns out to yield interesting management reading. Scrutinized from multiple perspectives, lots of pathologies to analyze, R and D is a major factor." He recommends Boyd, Quorum, National Defense by Fallos, and Augustine's Law by Augustine.

• 33:21Jordi Hays?

  Yeah, so while you're flipping brain rot real content, Patty's reading these esoteric books on defense procurement. And that's why he runs a $100 billion company.

• 33:34John Coogan?

  And you haven't raised a seed round yet.

• 33:36Jordi Hays?

  And you just lost 15 grand on meme coins.

• 33:38John Coogan?

  Yeah, exactly. That's great. But I gotta check out some of those books. That's probably pretty interesting stuff. But yeah, he's always been a real powerful deep diver of the arcane tax.

• 33:49Jordi Hays?

  Powerful deep diver. He would have had a podcast in another life.

• 33:52John Coogan?

  Yeah, yeah. This is an interesting one. Have you seen Pentagon Wars, this movie?

• 33:58Jordi Hays?

  No.

• 33:58John Coogan?

  It's fantastic. So it chronicles the story of the Bradley Fighting Vehicle. And it's like a made-for-TV

• 34:09John Coogan?

  Like almost like a dramedy, like a drama comedy.

• 34:12Jordi Hays?

  Oh, really?

• 34:13John Coogan?

  Yeah, and it's all about-

• 34:14Jordi Hays?

  That's like, kinda like our show.

• 34:15John Coogan?

  Kinda like our show, yeah. And so, it tells the story of the Bradley Fighting Vehicle and how the requirements just got so chaotic because they'd go to one general and he'd say, originally, it was just supposed to be an armored troop transport to take a bunch of guys from the rear to the front. So, it's just a bus, basically. And, but, you know, it needs to be fast so it can move. Needs a little bit of armor, but nothing crazy. But then, of course, they talked to one guy and he's like, "Oh, well, it'd be great if it had a gun on it." And then, they're like, "Okay, let's put a turret on it." And they're like, "Well, if we put a turret on it, like, it's gonna carry less guys." And they're like, "Okay, well, like, it also needs to be able to float in water." And so, they add that.

• 34:56John Coogan?

  And then, they're like, "Well, now, if it has the turret and it can go in the water, it's gonna be much heavier, so it's gonna be a target, so now I have to put more armor on it." And so, that's loaded down and stuff. And so, it's a hilarious movie, it's fantastic. But, there's a little bit of an interesting, like, flip side to this, a little contrarian take from Robert Potter here. He says, "The Bradley is literally taught to students of defense procurement as a bad example. The platform has been slammed, audited, and they even made a movie making fun of it, Pentagon Wars. The reality, here it is, flogging a Russian tank. Keep that in mind when people talk about the F-35." And so, there's always been-

• 35:34Jordi Hays?

  And the F-35 was in the news last week because there was a video on an airfield that just fell out of the sky. Luckily, the pilot ejected and came down in a parachute. But, um, and that was an $80 million-ish mistake, I believe.

• 35:48John Coogan?

  I mean, the program's in, I think, over a trillion or something. It's huge. But there's always been this-

• 35:53Jordi Hays?

  Is it actually over? It can't be over.

• 35:55John Coogan?

  I don't know.

• 35:56Jordi Hays?

  There's no way.

• 35:57John Coogan?

  It's very expensive. I don't know, the numbers are all so big, I can't even keep track anymore, but- But the interesting thing about the F-35 is when you talk to people in defense, they will say the problem with the F-35 is not that it's a bad plane, like as evidenced by the fact that China copied it. The J-20 is a direct copy of the F-35. Why would they copy it if it was a bad plane? That just wouldn't make sense. You wouldn't waste your time. Maybe you could make an argument that like, oh, the R and D is free, so you, you know, you just copy it because it's it's valuable if you don't have to pay the R and D cost. But the F-35 is not a lesson in, in like, oh, we, we tried to, we tried and failed to build a better, you know, air supremacy fighter or the platform.

• 36:39John Coogan?

  It is successful. It did actually do all the different things, electronic warfare. Like it's fast. It has all the different features. It's just that it went way over budget and took way too long and is just a technical mess. But it's still the best.

• 36:52Jordi Hays?

  You know, something interesting about, so if you're a fighter pilot and you're based somewhere in the US, let's say you're based in Nevada, if you, if you go on deployment, you just end up flying the jet there.

• 37:03John Coogan?

  Yeah.

• 37:04Jordi Hays?

  Isn't that a strange commute? And it ends up being these like really long, it's imagine it's, it's like a 16 hour flight.

• 37:10John Coogan?

  Yeah.

• 37:10Jordi Hays?

  So you just like commute over to work.

• 37:13John Coogan?

  Yeah.

• 37:13Jordi Hays?

  I just find it's, it's, you would imagine that they would get like shipped in some way.

• 37:18John Coogan?

  Yeah.

• 37:18Jordi Hays?

  Because like normally you're, I don't know, with, with like sports cars, right? You're not, you're not like, oh, I'm just gonna like go put some, I need, I want my, you know, turbo in New York. I'm gonna drive it all the way over there. But the planes, they just end up the most efficient way is just to fly it over there.

• 37:33John Coogan?

  Well, the new Anduril arsenal, their manufacturing plant is right next to an airstrip. And, and Palmer was talking to, I think Ed Ludlow at Bloomberg in this interview and saying like, oh yeah, we're right next to an airstrip. So we can like, and one of the advantages, and Ed Ludlow is kind of like, you know, answering his, finishing his sentences and saying like, oh, so like you can fly the plane straight from the factory to the customer, like to the Pentagon or to the airfield. And he's like, Palmer's like, yeah, or the war zone. You can just, it rolls off the factory line and it goes straight to the, to the front.

• 38:09Jordi Hays?

  Yeah.

• 38:09John Coogan?

  Immediately. And that's the most efficient way to deliver capability. And I just think that's, it's funny and interesting. Anyway, very expensive and, and again, highlights the fact that like, we aren't necessarily behind on the technology. We're just behind on the, on the efficiency and the procurement process. And over time, the-

• 38:29Jordi Hays?

  I'd rather be behind on procurement because that's a lot of process that you can rip out.

• 38:33John Coogan?

  But it's like, yeah, it's a leading indicator. It's like, we're overspending on the F-35. The next version won't even get made if, if, if the trend continues. And that's, that's the fear and the risk. So Matt Palmer says, hate to say it, but I don't think there's any way the US can position itself to deter a major war in the next decade, let alone win one quickly. The defense procurement system and the industrial base underpinning it is fundamentally broken and it will take a major war to fix it. He's a bit of a doomer. I think that there's a chance, I think Joe Lonsdale and the crew at the Pentagon-

• 39:04Jordi Hays?

  You know, I like how they're not taking the Doge branding into this. It's much more of just, hey, let's just do this.

• 39:10John Coogan?

  Yeah, yeah, yeah.

• 39:11Jordi Hays?

  We don't need to make it a big marketing campaign.

• 39:14John Coogan?

  Totally.

• 39:14Jordi Hays?

  We don't need Vivek in here, you know, trashing the jocks again. People like, people like, people like you, you know, hardworking Americans.

• 39:22John Coogan?

  I think, I think he's-

• 39:23Jordi Hays?

  Corporate athletes.

• 39:24John Coogan?

  In many ways, the, the, the, the cultural opposite.

• 39:27Jordi Hays?

  Yeah.

• 39:29John Coogan?

  But, I mean, defense tech is, is charging on. Let's go to our next story. Startup Castilian has raised a hundred million dollars for hypersonic strike weapons. I think we gotta ring the size gong for Castilian. Let's do it. Boom.

• 39:45Jordi Hays?

  Boom.

• 39:46John Coogan?

  Congratulations to everyone involved. We'll break it down here on the show. Yeah, this is a big one. We did 14 million, now we're doing 100 million. Congrats to Castilian. So they make hypersonic missiles.

• 39:59John Coogan?

  Silicon Valley's enthusiasm for superfast weapons has picked up speed with defense tech startup Castilian raising $100 million through debt and equity to build hypersonic missile systems. The company is vying to sell long-range strike weapons to the US military. Castilian is part of an increasingly well-funded sector of venture-backed defense companies. Many are hopeful that the new Trump administration will yield more government contracts for startups. There will be more support for awarding contracts to non-traditional players, said Castilian's co-founder Sean Pitt. The administration has given the Pentagon the freedom to lean into new companies. So they raised 70 million in venture and 30 million in debt. The funding round was led by Lightspeed Venture Partners, and it brings the company's total funding to 114 million. So they got here with just

• 40:44John Coogan?

  14.

• 40:45Jordi Hays?

  And have you seen their branding, by the way? It's very 50s nostalgic, or even almost WWII era. Some of the graphics that they use.

• 40:53John Coogan?

  No, I haven't seen that. That's cool.

• 40:54Jordi Hays?

  Feels a little bit insane to be, you know, talking about defense tech company branding, but I think it's smart by them because there are so many new players coming in. Differentiating yourself visually is just another way to kind of stand out.

• 41:08John Coogan?

  Yeah, yeah, it's great. And the last thing you want to do is just be like derivative and roll, right?

• 41:13Jordi Hays?

  Yeah, yeah, yeah.

• 41:14John Coogan?

  Because the...

• 41:15Jordi Hays?

  And Androl's been such a dominant force.

• 41:16John Coogan?

  Totally.

• 41:17Jordi Hays?

  And they kind of took the sort of Call of Duty-esque branding.

• 41:20John Coogan?

  Totally, totally.

• 41:21Jordi Hays?

  And that is what all these defense tech founders grew up playing.

• 41:24John Coogan?

  Yeah.

• 41:25Jordi Hays?

  And so it's sort of the default, but because Androl was first, they own it. So Castilian's done a good job of separating themselves from the pack.

• 41:33John Coogan?

  And so let's do a little bit of a deep dive on hypersonics. So the Defense Department has considered hypersonics a national security imperative for more than a decade. Despite spending billions of dollars on the effort, it has failed to develop battlefield-ready technology. Castilian says its frequent flight tests, quick engineering upgrades, and economical manufacturing will produce cheaper and better hypersonic weapons. It does test flights, it does three test flights per month in the California desert.

• 42:00Jordi Hays?

  So this is crazy. Hypersonic weapons, you might think hypersonic is faster than sound. A hypersonic weapon is defined as a projectile that flies at least five times the speed of sound.

• 42:12John Coogan?

  Yeah. Supersonic is Mach 1 to 5. Hypersonic is 5 plus.

• 42:17Jordi Hays?

  Yeah. So it can be launched from great distances, maneuver, and evade most air defenses. They became a top Defense Department priority during President Trump's first admin. A 2021 test flight by China, which launched a weapon that circled the globe 20 times the speed of sound or faster alarmed Washington.

• 42:35John Coogan?

  Yep.

• 42:35Jordi Hays?

  20, just ripping around 20x.

• 42:39John Coogan?

  So the main, the main reason why people-

• 42:41Jordi Hays?

  Choose that flight path fairly.

• 42:43John Coogan?

  That's the thing. You don't have to choose the flight path with a hypersonic missile.

• 42:47Jordi Hays?

  So fast.

• 42:48John Coogan?

  It's not just that it's so high. It combines speed. So the traditional ICBM, the intercontinental ballistic missile will also go Mach 20. I'm not sure if it's exactly Mach 20, but they go extremely fast. They go all the way up into space, but they follow a perfect parabolic arc. And so we have missile defense systems and satellites that track all of these different missiles as they go up, all the different rockets. So the rocket launches and you can see that it's on this very smooth trajectory. And what that allows you to do is calculate with a very simple mathematical equation. Well, if it's going, you know, a couple thousand miles an hour here, well, then in five minutes, it's going to be here. And if I just get my bomb or my missile here

• 43:31John Coogan?

  and explode, I will intercept it and blow it up.

• 43:34Jordi Hays?

  Yeah.

• 43:34John Coogan?

  It's very simple to build a, like a programmatic calculation for how to counter it. And so that's been the backbone of missile defense systems. And it's why people aren't genuinely freaked out about countries getting ICBM capabilities. Because, you know, North Korea will get one and it's like, yeah, we could probably shoot those down pretty effectively, scramble things as they come, shoot them down.

• 43:59Jordi Hays?

  Korea is so funny. It's, it's, it's like your drunk friend who just has a gun and they're just shooting it off in the air at random times.

• 44:05John Coogan?

  Yep.

• 44:06Jordi Hays?

  You gotta kind of, it's far away. And so you gotta look over there and be like, ah, what's going on? Is he all right? Hopefully that doesn't fall anywhere important.

• 44:14John Coogan?

  Yeah.

• 44:15Jordi Hays?

  Meanwhile, the adults are, you know, just sitting around.

• 44:19John Coogan?

  Yeah.

• 44:19Jordi Hays?

  Maybe every once in a while letting one off, but in a much more, you know, controlled Yeah. method.

• 44:24John Coogan?

  And so these hypersonic weapons are different than ICBMs because they don't follow- Predictable trajectories. They maintain the maneuverability almost of a jet or cruise missile, but they're going Mach 5. So cruise, there's a couple cruise missile companies and cruise missiles are obviously very important, but cruise missiles are typically subsonic. So they're not going, it's more like a plane with no one inside and just a bomb. So when you have something traveling Mach 5 and it's also able to maneuver, it's very hard to shoot it down. And so these are, the, people are worried about these hypersonic weapons being able to take out aircraft carriers very easily, be able to strike somewhere because it can take, you know, a lower path evade radar,

• 45:08John Coogan?

  evade the satellites, evade detection, and then just show up very quickly before you can react.

• 45:14Jordi Hays?

  I'm an advisor to this company, Aon. I don't know, have you ever met?

• 45:19John Coogan?

  I've never met them, but I'm familiar.

• 45:21Jordi Hays?

  So they're based in Texas and they, so in learning about that business, there's only two manufacturers that make, they make anti-tank missiles. So launch from the ground, you know, shoulder launched, sort of close range. There's two companies that make them and they, they've gotten to the point where they're charging, because they run on a cost plus model. So the, the manufacturers make like a fee on top of what it costs them to produce it. And so that means that they're incentivized to just run up the price. So they make more money. It's this very, you know, poor incentive. And so Aon's making them for 80% less money and they're making better products that are easier to use. And so Aon, you would think is just like, you know,

• 46:05Jordi Hays?

  obvious, easy when they just go in there and saying, hey, our products, you know, costs 80% less. It's easier to use. But because of this procurement process, which we've been talking about, it's just not, it's not a shoe-in, right? It's a struggle to get, you know, and they've done very well in terms of getting traction in the Pentagon, but.

• 46:28John Coogan?

  And so a lot of it is, you know, you just have to go and get some sort of general or admiral to come out and watch your demo. And we've seen videos of Palmer doing this in the desert. In a wonderful Hawaiian shirt and Castilians clearly made that part of their strategy as well. They bought this crazy looking like tank transport thing. And they drove it to El Segundo, which I guess is where they're headquartered. So welcoming our new LSVR MKR 18 to El Segundo this week. We'll be making upgrades to convert this vehicle into a launcher system for our upcoming flight test. And it's a fun ride. So I think they can build in their factory, put it on the back, drive it out to the desert and then just shoot it off and fire it.

• 47:09Jordi Hays?

  I think, I think this creates a fun dynamic for VC demos. So if you're running a process, your investors, you know, potential investors want to see what you got. Invite them all out to the same demo.

• 47:23John Coogan?

  That's literally happened.

• 47:23Jordi Hays?

  Blow some stuff up and then say, you guys can talk amongst yourselves and figure it out.

• 47:27John Coogan?

  That literally happens all the time.

• 47:29Jordi Hays?

  Steve, CEO of Allen Control Systems. There was all these, you know, investors, he was raising a new round last year. All these investors wanted to meet. I was like, invite them all to the same demo because they're going to just be sitting there watching this incredible. You know, demo the technology and, and for him, he's making counter drone. You know, system. So it's just very cool and highly relevant to the battlefield today. And anyway, so cool opportunity. Normally you're giving a VC a demo, your product that they're using it. But this sort of putting them all out on the same desert is just a fun dynamic.

• 48:03John Coogan?

  I've heard of that happening and all the VCs were standing around talking to each other. And one of the bigger VCs there looked to the other one and said, you're not getting a penny of this round. And it was like, wow, that guy's kind of dick, but like it, it worked and they took the round and, and it got done and it's good for the founder. So lots of investors have been singing Castilians praises. Andreessen Horowitz is in the round. They said, Michelle Vole's former Andreessen associate.

• 48:30John Coogan?

  Or partner says, "The best way to ensure the next era of Pax Americana is to build capabilities that deter our adversaries." Congrats to the team. Jake Chapman says, "With a fantastic handle on X, just @VC."

• 48:43Jordi Hays?

  Crazy.

• 48:44John Coogan?

  He says, "Excited for Castilian and to see us developing this American capability. And I like the folks I know at Lightspeed, but Lightspeed maintains a China arm. What's the relationship between these two firms from a money, control, systems, information flow perspective? Why did everyone scream about Sequoia?" Was totally fair, but nobody seems to care about Lightspeed. So he's putting the, putting the screws to Lightspeed, telling them divest immediately, I guess. Blue Yard Capital is also in this deal. "We are excited to consider, continue supporting Castilian Corp. on their mission to preserve peace through deterrence. Read more about their $100 million Series A financing in the Wall Street Journal," which we just did. And Castilian is very excited to announce their round. We should close out with some more context from the Air Force. The hypersonics program

• 49:29John Coogan?

  the Air Force estimated would become operational in 2022 hasn't materialized. And the service is working on another program that says it will produce a weapon in 2027. An Air Force spokeswoman, woman, said the service is working on other programs and collaborating with startup defense companies and providing them with opportunities to demonstrate their technology. Many in the industry hopes Trump's shakeup in Washington agencies, the, the technology industry's coziness with the president, the influence of Musk, himself, the founder of the largest venture-backed defense tech company, will bring attention and money to hypersonics. And so-

• 50:01Jordi Hays?

  Yeah, and that's what people still don't realize about SpaceX is it is being able to put things up in space fundamentally makes you a defense tech company.

• 50:10John Coogan?

  Totally.

• 50:11Jordi Hays?

  It's not a, just an aerospace, you know, space company.

• 50:13John Coogan?

  Yeah.

• 50:14Jordi Hays?

  And that's part of what, part of their value to the United States.

• 50:16John Coogan?

  A hundred percent. Yeah. And, and I mean, Starshield has been very important in getting internet to the front lines. But then also there's all the other applications of just putting up spy satellites and even converting the rockets to ICBMs potentially. So all of, all three of Castilian's founders were previously senior, in senior positions at SpaceX and roughly half the company's 60 employees joined from SpaceX. That's pretty crazy. And Castilian said it would have a finished product ready for the military by 2027 and will have its first hypersonic speed test flight for its weapon this summer. It has been awarded more than $22 million in federal government contracts, mostly from the Air Force. And so we love to see that.

• 50:58Jordi Hays?

  Yeah, and that's and that's why this raise shouldn't be that surprising from a headline number standpoint is they're generating 22 million off of one, basically one contract. And I'm sure they have others either done or in the pipeline. And if you're a series B SaaS company with 22 million of ARR, you can easily go out and raise 100 million at like a $500 million valuation.

• 51:20John Coogan?

  Sometimes those contracts are kind of paced out, though, so it's unclear how much they're drawing down from it. But still, yeah, it's obviously a good sign.

• 51:28Jordi Hays?

  And the and the order that people don't realize the order, if if these contracts pan out well and the product starts to work, you could be looking at billions of dollars in orders on one SKU.

• 51:40John Coogan?

  Yeah, yeah.

• 51:41Jordi Hays?

  Which is just, that's where.

• 51:42John Coogan?

  Yeah, there was some, some like, you know, like, what is the bear case here? Why, like, what could go wrong? Like, there are competitors in the space. There are other startups that do solid rocket motors. Andorall bought a solid rocket motor company. But it seems like Castilian is focused on being the integrator that actually builds the complete system, which I'm sure is is is much more complicated than manufacturing any one piece.

• 52:06Jordi Hays?

  The other thing, you get these billion dollar orders and then you have these servicing contracts, which are like SaaS, like, you know, sort of annual contracts on a per typically, from what I know, a per missile basis. It might be you sell a hypersonic for, call it $2 million, and then you have 400K a year for 10 years to maintain it. So it's very predictable, stable revenue. Once you win the contract. And so I think what we're seeing already in defense tech is the the companies that have contracts now that are actually getting traction in the Pentagon, they are going to get more and more capital piled into them because there's this, there's a lot of pre-seed, seed stage companies that are, you know, able to raise $5 million, but getting to that next.

• 52:50Jordi Hays?

  Round, even if you build the technology, if you don't have the contract traction, you're just not going to get there.

• 52:56John Coogan?

  Yeah. So one of the venture capital firms in Castilian is Blue Yard Capital, and their fund performance was just published by Eric Newcomer in his newsletter, Newcomer.

• 53:10Jordi Hays?

  And I don't think they intended for it to be published, but uh.

• 53:14John Coogan?

  No, do you know the backstory of how this stuff leaks?

• 53:16Jordi Hays?

  Yeah, so it's a public endowment that basically has to publish.

• 53:20John Coogan?

  Their data.

• 53:21Jordi Hays?

  Presumably for some type of compliance reason.

• 53:23John Coogan?

  So it's the, it's, it all comes from UTIMCO, the investment arm of the Texas Public University System. So I don't know if it can be FOIA'd, or it's just automatically released, but Newcomer loves getting those new UTIMCO reports because they.

• 53:39Jordi Hays?

  And all the, I'm sure there's, I'm sure there's fund managers now that are like, I don't want to raise from them because I don't want five years from now, my fund to be getting dragged.

• 53:49John Coogan?

  Yep.

• 53:50Jordi Hays?

  You know, a lot oftentimes, you know, people, but anyway, I thought this was a crazy story. So Blue Yard, Blue Yard.

• 53:56John Coogan?

  It's killing it.

• 53:57Jordi Hays?

  Is killing it.

• 53:57John Coogan?

  Yeah.

• 53:58Jordi Hays?

  It's 2016 fund has 53% IRR. And where are they based? While they're ripping checks into American hypersonics? Berlin, Germany.

• 54:06John Coogan?

  Berlin, okay.

• 54:09Jordi Hays?

  Have you been to Berlin?

• 54:09John Coogan?

  I have.

• 54:10Jordi Hays?

  Cool, cool city.

• 54:11John Coogan?

  Yeah, I went to October.

• 54:13Jordi Hays?

  It's only going to get more and more punk as their economy continues to collapse.

• 54:17John Coogan?

  Well, yeah, they're really siphoning the money out of the German economy with this fund now.

• 54:20Jordi Hays?

  Into the, yeah, yeah.

• 54:22John Coogan?

  But maybe it'll come back in distributions.

• 54:24Jordi Hays?

  Well, hopefully, Blue Yard's LPs are mostly American.

• 54:28John Coogan?

  Yeah.

• 54:28Jordi Hays?

  If they're investing in American companies, we can keep those, you know.

• 54:31John Coogan?

  And so it seems like Newcomer went to David Byrd, the general partner at Blue Yard, and said, hey, I got you dead to rights. I got the UTIMCO report.

• 54:41Jordi Hays?

  And this was cool. He ended up sharing.

• 54:43John Coogan?

  But, but yeah, they came back and they were like, here are the real numbers. UTIMCO calculates it one way. We can give you our marks. And it seems like they're doing really well. The first fund generation they raised in 2016, they raised a $120 million fund, net multiple of 4.8X and a net IRR of 51% for a DPI of 3.4X. So they're doing great. That allowed them to raise four more funds, Blue Yard 2, Blue Yard 3, and then two crypto funds.

• 55:10Jordi Hays?

  Little bit of a narrative violation. A lot of people, when they see a fund go from doing defense and biotech to. FOMOing into crypto, oftentimes, you know, they just assume that they're just incinerating cash. But the first, their crypto fund, which was started in 2021, $75 million fund, has a gross multiple of 1.7x right now and a gross IRR of 28%. And so this is, again, the narrative violation that we've talked about before, which is that the average crypto fund outperforms the average venture fund.

• 55:46John Coogan?

  Yep.

• 55:46Jordi Hays?

  And so crypto, the crypto industry continues to laugh to the bank.

• 55:52John Coogan?

  Yep.

• 55:52Jordi Hays?

  Some retail investors get a little smoked in the process, but it's part of the game.

• 55:57John Coogan?

  And so newcomer posted the full deep dive, which you can go see on his Substack.

• 56:04Jordi Hays?

  Paywalled.

• 56:05John Coogan?

  Paywalled. But everyone in tech has a subscription or the ability to hop the paywall if they need to. And Brad Holden gives a shout out to Protocol Labs for helping Blue Yard drive amazing returns. Any project would be lucky to have Blue Yard supporting them.

• 56:24Jordi Hays?

  That was their crypto fund?

• 56:26John Coogan?

  Yeah, that was the crypto investment that really drove returns in their early fund, which I think invested in both Castilian early on and Protocol Labs, which really, I guess, mooned. And so there's a couple other, there's a couple other funds that are highlighted in here from the UTIMCO report. True Ventures is doing well.

• 56:45Jordi Hays?

  Yeah, so UTIMCO has invested in not just one or a handful of funds. They've done 10 of True Ventures funds. And so this is why these solo GPs, you have to start out raising 200K checks from a bunch of random people, but you try to get to raising from endowments.

• 57:02John Coogan?

  Yep.

• 57:02Jordi Hays?

  Because endowments will basically ride with you for your entire career in certain instances, especially if you put up solid numbers early.

• 57:11John Coogan?

  Yep.

• 57:11Jordi Hays?

  And it's valuable because even if you have a fund that underperforms, you know, they'll continue to double down and build that trust with you.

• 57:19John Coogan?

  And so True Ventures, the newer vintages still have negative IRR because obviously the newer companies, they die off faster and then the later ones start to grow. But the overall IRR is in a solid place at 23.59%. Which is great. Upfront Ventures has been in trouble. Their portfolio, their growth portfolio has fared worse than its early-stage funds per UTIMCO's IRR calculations. The firm has only returned around 35 million to UTIMCO out of 127 million invested so far, though its holdings on paper have been marked up to nearly 150 million. It has an overall IRR of 9%.

• 57:58Jordi Hays?

  Yeah, so to be clear, they're, well, this doesn't look great on paper compared to True or Blue Yard. They're still sitting on, you know, what, what will, you know, if it were to be realized today, who knows if it would be, is a, you know, 9% IRR, which beating, you know, close to beating the market.

• 58:19John Coogan?

  Yeah. And, and there's some other funds that got scooped by Newcomer. So, go check it out. Always interesting to dig into what funds are, are raising important for founders to understand.

• 58:34Jordi Hays?

  Yeah, the only other-

• 58:34John Coogan?

  Who's on an upswing and who actually has more capital to deploy. Because, once you see a fund start declining in the IRRs, you're, they're likely not going to raise those follow-on rounds. They might not be the partner for you that will be there for those Series B, Series C checks, keep upping their pirata, staying with you if they're-

• 58:53Jordi Hays?

  Yeah, and this one, this other Foundry Group, which was in the news last year, because I think they returned capital or-

• 58:59John Coogan?

  Oh, is that right?

• 58:59Jordi Hays?

  Maybe I'm confusing it with another fund, but, yeah, they're just no longer even raising. So, that, even funds that, you know, firms that end up raising, you know, in this case, over eight individual funds, sometimes don't have proper succession plans, or the GPs just decide, you know, we had a good run, let's call it. Because these things are, every new fund is 10-plus years of, you know, commitment to managing the firm. And if you're getting to, you know, retirement age, you're sitting there, I'm 60 years old, I want to raise another fund now and then-

• 59:33John Coogan?

  So, I'm bored for another decade.

• 59:36Jordi Hays?

  Yeah, potentially even 15 years oftentimes, if you get real winners that have, you know, continued access to capital. So, it's a long-term commitment.

• 59:45John Coogan?

  Well, moving on to one of the greatest capital allocators of all time, Masayoshi Son is in the news.

• 59:53Jordi Hays?

  Did we hit the size gong just?

• 59:54John Coogan?

  Yeah, let's just hit it a bunch for Masayoshi. He's got so much going on.

• 1:00:01Jordi Hays?

  I mean, the, the original size lord.

• 1:00:03John Coogan?

  Add four zeros to every number.

• 1:00:06Jordi Hays?

  Yeah, yeah, you can't. You can't keep a good man down.

• 1:00:09John Coogan?

  So there's a report from the information about how he made it back into the White House. When President Donald Trump announced a $500 billion plan for data centers to power artificial intelligence, one of the men standing to his left was already getting ready to write the checks.

• 1:00:22Jordi Hays?

  And, and can we give some credit to Sam for just aura farming the president?

• 1:00:27John Coogan?

  Oh, yeah.

• 1:00:28Jordi Hays?

  He got, Trump has really nothing to do with Stargate at all.

• 1:00:33John Coogan?

  Nope.

• 1:00:33Jordi Hays?

  And Masa and Sam got him to announce their project.

• 1:00:36John Coogan?

  Yep.

• 1:00:36Jordi Hays?

  So, uh, Lulu, Lulu, uh, always says, you know, go direct.

• 1:00:42John Coogan?

  Yep.

• 1:00:42Jordi Hays?

  But if you, if, if you get the opportunity, have the president announce your new, your new fund, uh, doesn't hurt to get, to get a little, uh, you know, aura boost.

• 1:00:53John Coogan?

  So, uh, SoftBank CEO Masa Oshison was already making plans to put a total of 40 million into, 40 billion, sorry, I knew I was going to misspeak, in, into the Stargate data center project, as well as the company that Stargate is, that is Stargate's driving force, OpenAI, two familiar, two people familiar with the matter, said, how SoftBank will finance the investment isn't clear, but the company has separately started discussions to borrow as much as 18.5 billion, using the value of its publicly listed assets as collateral.

• 1:01:22Jordi Hays?

  Sun is levering up.

• 1:01:24John Coogan?

  Levering up.

• 1:01:25Jordi Hays?

  Levering up.

• 1:01:26John Coogan?

  We need a big lever that we can throw when the leverage turns on.

• 1:01:30Jordi Hays?

  Well, and it's crazy because if you just held on to his Nvidia shares, he could have, he could probably actually.

• 1:01:36John Coogan?

  So we have a post about that from, uh, Dr. Perique Patel, CFA, he says.

• 1:01:40Jordi Hays?

  I don't think he's.

• 1:01:42John Coogan?

  He says, BA, CFA, A, A, ACCA, ESQ. He says, Masa Seon owned 5% of Nvidia and sold his entire stake in 2019 to buy WeWork. He is the best AI investor ever. So lots of people are trashing Masa. We got another post from none other than Jordy Hayes here, saying.

• 1:02:02Jordi Hays?

  I'm not, I've never trashed Masa.

• 1:02:04John Coogan?

  No, this is, this is good.

• 1:02:06Jordi Hays?

  I think, I think he's, I think he's.

• 1:02:06John Coogan?

  So now that Masa is investing 100 billion a year again, it's time to bring back. This classic SBG shareholder value. Bunch of unicorns, AI traffic.

• 1:02:15Jordi Hays?

  So the funny thing, so, so I think it talks about this in this article, but while he was, he was so bullish on AI. When he was just going so hard into WeWork. And I think it's because he fell in love with Adam.

• 1:02:26John Coogan?

  Yeah.

• 1:02:26Jordi Hays?

  And he was just so enthralled by, you know, just the Newman effect.

• 1:02:30John Coogan?

  Yeah.

• 1:02:31Jordi Hays?

  If he like, he was so early, if you look at all of his slides.

• 1:02:35John Coogan?

  Yeah.

• 1:02:36Jordi Hays?

  It's funny because he has like another slide that, that's.

• 1:02:38John Coogan?

  Yeah, yeah, I think we have this one here.

• 1:02:40Jordi Hays?

  There's that one.

• 1:02:40John Coogan?

  Rohit says, Masa's back, baby. And it's a new slide that has the same design aesthetics of Jordy's slide. Saying the evolution seed illustrative agricultural revolution, industrial revolution, information revolution, birth of superhuman. I love it.

• 1:02:57Jordi Hays?

  So dramatic, so cool. He, uh, he has another one too, that's this really funny graphic that says the valley of coronavirus. And then, and then just two further growth.

• 1:03:09John Coogan?

  Yeah.

• 1:03:09Jordi Hays?

  So Masa was, was talking about AI before, almost before I was born.

• 1:03:14John Coogan?

  Yeah. I mean, it is, it is funny because these slides, as ridiculous as they look, they are great ways to communicate a simple idea.

• 1:03:22Jordi Hays?

  I mean, it's basically what other people are saying in, in 5,000 words. He's saying with one slide.

• 1:03:27John Coogan?

  Yeah, yeah. But you read a Goldman report and it's going to be like bar charts with tons of annotations.

• 1:03:31Jordi Hays?

  He's not trying to.

• 1:03:31John Coogan?

  Merameco graphs, waterfall charts and all this stuff.

• 1:03:34Jordi Hays?

  He's, he's, he's a vibes oriented investor.

• 1:03:37John Coogan?

  Yes, yes, yes.

• 1:03:37Jordi Hays?

  And he has extreme conviction that's got him into some hot water before. But, but overall, uh, he's been generally, uh, you know, he's had, he had some issues back in the telecom days. We have to do, we're going to do, so maybe even tomorrow we'll, we'll do this, but like the full story of Masa. Cause, cause you can't keep a good man down, but, but this story is great. So, um.

• 1:04:03Jordi Hays?

  They're talking about the announcement, which was only, was it last week? So crazy. It feels like a month ago. He says, "One of the men standing beside Masa, OpenAI CEO Sam Altman, traveled to Masa's mansion in Tokyo this month, seeking a big check to fund his company's growth. Altman and Masa finalized the agreement a few weeks ago, a couple of days before Congress certified Trump's election," a person familiar with the negotiations says. SoftBank, so to be clear, was already an investor in OpenAI, so Masa, you know, has been on, been on the journey. It's funny because they finalized the agreement, but it seems like they kind of just rode down. You know, it seems like the way that Stargate got announced and everybody's just like, "Yeah, I'm good for, I'm good for 20 billion a year. I'll figure it out," you know?

• 1:04:48John Coogan?

  You know that both Sam and Masa are obsessed with Napoleon? So Sam had this blog post saying, like, "The best book I read this year was Napoleon in his own words," this famous book. And a lot of people read into that, like, "Bro, like, that's too much. Like, that's too intense. Like, you should back off of that." Because like, yeah, there's probably some good lessons in there, but it's a little, little intense to be like, "I want to be Napoleon," right?

• 1:05:15Jordi Hays?

  Yeah.

• 1:05:15John Coogan?

  And Masa has massive paintings of Napoleon.

• 1:05:19Jordi Hays?

  I bet Masa has like, actual artifacts from the-

• 1:05:21John Coogan?

  Oh, yeah. He's like a collector. He's like a true believer in the-

• 1:05:24Jordi Hays?

  The largest collection of Napoleon's old swords or something like that.

• 1:05:28John Coogan?

  Oh, yeah, totally. But, you know, Napoleon had ups and downs and major comebacks, you know?

• 1:05:33Jordi Hays?

  Yeah.

• 1:05:33John Coogan?

  It's a beautiful story. Tane says, "Jensen reminding Masa he was Nvidia's largest shareholder at one point. SoftBank sold their 5% stake in Nvidia for 4 billion in 2019. It would have been worth 150 billion today." And you posted this picture of them like, hugging. The context of that video is, I think, a little bit different, saying, like, Jensen's saying like, "Yeah, you used to be a big, a big shareholder." Like kind of mugging him a little bit. I don't know. I'm not exactly sure, but, but it is a very rough, rough luck.

• 1:06:04Jordi Hays?

  Masa, you never know. Maybe he, maybe it was his whole plan. He wanted to bottom, you know, bottom ticket so that it would inspire him to grind harder.

• 1:06:13John Coogan?

  Yeah, yeah. Could have been one of those situations. Uh, we, we, we got a great, we got a great post from Gabriel. He says, if they make the rock float at a VC backed space factory company, referring to Varda and the LK 99 thing. It's completely over for tech critics. Zerp vindicated, capital allocated correctly. Masa Seun was just early. Kathy Wood, greatest of all time. We will be multi-planetary species and you will enjoy post scarcity. And obviously very funny post, great poster. Um, the, the, the rocks did not float. The LK 99 thing did not replicate. And so it was in fact so over.

• 1:06:50Jordi Hays?

  Wasn't Arvarian Andrew McCallig working on that?

• 1:06:52John Coogan?

  Yeah, yeah, yeah. And, uh, I was there the night it happened. It was very cool and looked like they were floating, but it turned, it turned out to just be a magnetic effect. Not a, uh, superconductor effect. It was very cool. Uh, it was still cool that they were able to just do the science project on the side. And it was, it was just very cool for like recruiting. It made a lot of sense, but it was, but it was, it was, it was an invalidation of his claim that, you know, maybe, uh, you know, magic was about to happen.

• 1:07:16Jordi Hays?

  Yeah.

• 1:07:17John Coogan?

  And of course things developed a little bit slower than we thought.

• 1:07:19Jordi Hays?

  Well, I want to see, I want to see the, the only times I've seen Kathy Wood in the news recently is her saying, we have such extreme losses that we will not have to pay. You know, capital gains for, and it was like, she kind of set herself up to be dunked on a little bit with those posts. But let's get Kathy back in the mix. Masa's back in the mix.

• 1:07:39John Coogan?

  Yep.

• 1:07:39Jordi Hays?

  I want an Adam Newman AI startup.

• 1:07:41John Coogan?

  Yep.

• 1:07:42Jordi Hays?

  I want TK to, to launch a foundation model.

• 1:07:45John Coogan?

  Yep.

• 1:07:46Jordi Hays?

  I want it all.

• 1:07:47John Coogan?

  And so, uh, I liked this post from Sophie Netcap Girl, uh, says, Sophie says, though he's become a bit of a meme because of WeWork, Masa Seon is an icon and one of the most successful tech investors ever. It won't work for everyone, but he truly embodies what it means to bet big on your highest conviction ideas and to not be afraid of being wrong and lose money. Masa Seon made a total of $72 billion on his $20 million bet on Alibaba from 2000.

• 1:08:17Jordi Hays?

  So you know Masa basically has one of the greatest venture investments of all time. 20 million into 72 billion.

• 1:08:25John Coogan?

  That's insane.

• 1:08:26Jordi Hays?

  It's just so insane. You know that he's just so pissed that he didn't put a billion in, that he's like, I'm never going to make that mistake again. And so every, from that point on, he was, he was the ultimate size lord.

• 1:08:37John Coogan?

  Yep. Yeah, it's a fascinating story. And so Paki also shows Masa some love. He says, I for one love that Masa just keeps coming back. OpenAI and Jony Ive and talks to raise 1 billion from SoftBank for AI device venture. And so Sam is just, is just a master of just taking talent, money, putting it all together.

• 1:09:00Jordi Hays?

  Vibes.

• 1:09:01John Coogan?

  And, and he's just a vibe aligner and it works. And so, uh, uh, let's go through some more of this, of this post. People involved in Stargate stress that the high-profile White House announcement last week was merely a blueprint to a years-long effort. We talked about this more of a roadshow than actually a funding announcement. If SoftBank ends up spending the 40 billion, a larger sum than is, than previously known, that, that would be one of its biggest investments ever. While Seon takes out big loans, it often sets the stage for financial drama. Highly leveraged telecom deals have put him on the brink at least twice, but he's always managed to survive. The financial risks involved became almost immediately clear on Monday. The markets were roiled by skepticism that big spending

• 1:09:45John Coogan?

  on AI wouldn't pay off for investors. Valuations were already stretched when Chinese AI model DeepSeek showed it could potentially produce AI at a far lower cost than its rival. SoftBank's stock fell 10% on Monday, wiping out the gains it made after the announcement of Stargate. It's kind of funny, Stargate's announcement to build massive infrastructure comes at a point when maybe we don't need the infrastructure in a way we're expecting, said Rafael Dorno, a financial consultant for venture capital and private equity firms who focuses on AI investments. There are questions around Stargate. The soundness of Seun's bet will become more apparent in the coming years. He has suffered from big financial busts like WeWork and Cetera in recent years. He's made those non-tech bets while he was touting the potential of

• 1:10:29John Coogan?

  artificial superintelligence to change the world in the coming centuries. Meanwhile, he sold off the firm's multi-billion dollar stake in Nvidia before the chipmaker had its historic stock run up. So he is back. He made, it seems like he was down pretty bad, but then made it like basically all back on ARM, right? He turned $32 billion investment into 82 billion?

• 1:10:51Jordi Hays?

  No, quite a bit more. That 82 billion was a gain.

• 1:10:54John Coogan?

  That's amazing.

• 1:10:55Jordi Hays?

  So Moss is the king of making it all back in one trade.

• 1:10:58John Coogan?

  He really is. He so do.

• 1:11:01Jordi Hays?

  He studied, so he realized that that many investors, sports bettors, gamblers, poker players, many of them quit right before they're about to hit it big.

• 1:11:11John Coogan?

  Yeah.

• 1:11:11Jordi Hays?

  And so he just never quits.

• 1:11:13John Coogan?

  If he hits superintelligence and just becomes the richest man in the world, it's so over for the critics.

• 1:11:18Jordi Hays?

  Yeah.

• 1:11:18John Coogan?

  It's great. In a 2016 meeting at Trump Tower after Trump's first election, Seun indicated the iPhone manufacturer Foxconn would bring tens of thousands of jobs to the United States before the firm was ready to announce the move. He just completely jumps the ground. Foxconn eventually backtrack on its plans to build a new US plant. SoftBank's own commitment to create tens of thousands of jobs in the country coalesced through its investments in US startups backed by the First Vision Fund.

• 1:11:42Jordi Hays?

  He's like, fine, I'll do it myself. He just writes 10, 10 $1 billion checks and he goes, hire just like, hire like 10,000 people. Just grow fast and hire like 10,000 people.

• 1:11:53John Coogan?

  Yeah. Seun's effort to integrate himself with Trump before many other CEOs were willing, had some business logic behind it. For years, regulators in President Barack Obama's administration rebuffed SoftBank's efforts to merge Sprint, the US mobile carrier it had borrowed heavily to buy shares in years earlier with competitor T-Mobile. So he wanted to merge T-Mobile and Sprint. A federal judge approved the deal at the end of Trump's first term in 2020. SoftBank still has about a $17 billion stake in T-Mobile. All of these stakes are just so huge. Like it's not a venture fund. It's just this like Warren Buffett-esque entity.

• 1:12:30Jordi Hays?

  Yeah.

• 1:12:31John Coogan?

  So it announced in 2019 that its second vision fund had amassed $108 billion of investor commitments from Microsoft, Apple, and others. SoftBank has yet to raise any outside capital for the fund. Jordan Levy, who worked at SoftBank's early-stage venture capital team for 16 years, said Sohn tends to announce initiatives before they're ready. Masa is one of those guys who is ready, fire, aim, but he manages to figure it out. I love this guy. Just worked with him for 16 years and he's just like, yeah, he's a wild man.

• 1:13:00Jordi Hays?

  Yeah, he's an absolute dog.

• 1:13:01John Coogan?

  He's an absolute dog. So I didn't realize this. He's only 67 years old.

• 1:13:06Jordi Hays?

  He's got.

• 1:13:07John Coogan?

  He's got time.

• 1:13:09Jordi Hays?

  He's.

• 1:13:09John Coogan?

  He gets on the Brian Johnson.

• 1:13:10Jordi Hays?

  Brian Johnson protocol.

• 1:13:11John Coogan?

  Oh, he's good, you know?

• 1:13:14Jordi Hays?

  I mean, I'm so happy that we have.

• 1:13:16John Coogan?

  Pills an hour and he'll be good.

• 1:13:18Jordi Hays?

  I just, all I want is for him to do a proper annual keynote.

• 1:13:22John Coogan?

  Yeah.

• 1:13:22Jordi Hays?

  Like Warren Buffett style, you know, really lean into the brand. I want, we need more material, right? So X, we're sort of relying on all these old slides. Where's the new slide, Dex? You know, he's, you know, he's cooking on good slides.

• 1:13:35John Coogan?

  He's got, he's got something cooking. Masa has achieved amazing things for him and his company, but I'm not sure if people look at Masa the way they do other titans. Levy, Levy said, this is really something to him. He thinks that he can create a legacy. And so, yeah, he's still got a chip on his shoulder. People are laughing and he's going to be, he's saying, I'm gonna have the last laugh.

• 1:13:56Jordi Hays?

  Yep.

• 1:13:56John Coogan?

  And related to Masa, we're moving on to our next story. Sam Altman-backed Retro Biosciences is raising a billion dollars for a project to extend human life. So Sam can just, here it comes again.

• 1:14:15John Coogan?

  Again, it's two raises.

• 1:14:16Jordi Hays?

  Little bit of a road, road show, road show moment, road show moment.

• 1:14:20John Coogan?

  I mean, it's like, it's like.

• 1:14:21Jordi Hays?

  I mean, it's, it's, it's actually the most, a lot of, you know, if you.

• 1:14:28Jordi Hays?

  Founders struggle with this, right? Because if you wanted to really kickstart a fundraising process, you'd go out there and you'd say, "I'm fundraising."

• 1:14:33John Coogan?

  Yeah.

• 1:14:33Jordi Hays?

  But you kinda can't.

• 1:14:34John Coogan?

  You can't really.

• 1:14:35Jordi Hays?

  Do that. You can, I guess, at a certain scale, just go, "Yeah, we're planning to raise a billion."

• 1:14:40John Coogan?

  Yeah, yeah, yeah.

• 1:14:41Jordi Hays?

  But you, but they're not.

• 1:14:42John Coogan?

  Yeah.

• 1:14:43Jordi Hays?

  They're not saying, "We're raising right now. Please come invest in our startup."

• 1:14:47John Coogan?

  Yeah.

• 1:14:47Jordi Hays?

  It's much more of this sort of roadshow-style announcement. And when you're raising a billion dollars for a company which presumably, you know, has no revenue, or very little.

• 1:14:58John Coogan?

  Or incorporation documents.

• 1:14:59Jordi Hays?

  Or maybe, yeah, yeah. A little pre-product.

• 1:15:02John Coogan?

  I think this does exist.

• 1:15:03Jordi Hays?

  No, yeah, I've heard of this company, it's been around for a while.

• 1:15:06John Coogan?

  But, I mean, it is true, like, I think you and a lot of other folks, when they're thinking about a new business idea, oftentimes it helps to like, build a deck around it.

• 1:15:14Jordi Hays?

  Yeah, yeah, yeah.

• 1:15:15John Coogan?

  And then share that around with partners and people.

• 1:15:17Jordi Hays?

  I've made, I've helped start, you know, a bunch of different companies, but I've made 10 times as many decks.

• 1:15:22John Coogan?

  10 times as many decks.

• 1:15:23Jordi Hays?

  And I'll flip it out and I'm like, "Okay, yeah, I think in decks, it's the best way."

• 1:15:27John Coogan?

  Yeah.

• 1:15:28Jordi Hays?

  It's much more if you, if you have an, if you have a cool idea.

• 1:15:31John Coogan?

  Yeah.

• 1:15:31Jordi Hays?

  And you can't turn it into a compelling deck, it's just a cool idea.

• 1:15:34John Coogan?

  Exactly.

• 1:15:34Jordi Hays?

  It's not a real business opportunity.

• 1:15:35John Coogan?

  Exactly. And so, it seems like, for a lot of these guys at this level, they think in Financial Times profiles.

• 1:15:42Jordi Hays?

  Yeah, yeah. And to be clear, I, I think what they're doing, sounds amazing, and I would like them to have a billion.

• 1:15:49John Coogan?

  Totally.

• 1:15:49Jordi Hays?

  I would give it to them if I had it, you know.

• 1:15:53John Coogan?

  And so their seed round.

• 1:15:54Jordi Hays?

  If it wasn't all in my friends', you know, early-stage, you know, pre-seed startups.

• 1:15:57John Coogan?

  Yeah. And so, they did a modest seed round, I think we might have to get the size gong out for this, $180 million seed. And this will put more money in the Series A. The company is in talks with family offices, VCs, and sovereign wealth funds, as well as US hyperscaler data centers to provide computing power. And so this $1 billion might come in the form of cloud credits as well, be sort of a blend, but... You know, he's certainly raising. So the San Francisco based biotech will use the money to fund clinical trials trials for three drugs, including a potential treatment for Alzheimer's disease, which will be tested in an early stage study in Australia this year. It's also working on drugs for rejuvenating blood and brain cells. I love that. Right now, if someone gets Alzheimer's, it doesn't matter what your resources are. You know, if you're like Joe

• 1:16:40John Coogan?

  Biden or Elon Musk or whoever, you can write as big of a check as you want to anybody and nobody knows how to cure it.

• 1:16:47Jordi Hays?

  Which is so crazy.

• 1:16:49John Coogan?

  Sad. Yeah.

• 1:16:50Jordi Hays?

  Imagine how much funding Joe Biden would have had available to not be, you know, falling apart while president of the United States.

• 1:16:59John Coogan?

  Yeah, I I posted this. It was like when Biden was having trouble, he should have put together like an Operation Warp Speed.

• 1:17:04Jordi Hays?

  Or GoFundMe.

• 1:17:05John Coogan?

  For for Brian Johnson Blueprint.

• 1:17:08Jordi Hays?

  Yeah, or just throw up a GoFundMe. I would have thrown a bone to.

• 1:17:11John Coogan?

  Yeah.

• 1:17:13Jordi Hays?

  Pass the hat.

• 1:17:14John Coogan?

  And so Altos, backed by Jeff Bezos, had the largest ever biotech fundraising, raising $3 billion in 2022. So a lot of these different power players in Silicon Valley are doing biotech stuff now. Obviously Elon has Neuralink, which is bio related and curing a lot of blindness, but also paraplegics, like syndromes. Betsy La Croix said Altos has brilliant minds and admirable longer range research goals, but he said he and Altman both come from the tech accelerator Y Combinator, and so they have a very fast paced, action oriented, target centric mindset.

• 1:17:53Jordi Hays?

  The reason I like this play is because a lot of people talk about AI solving aging.

• 1:17:58John Coogan?

  Yep.

• 1:17:58Jordi Hays?

  But then it's not obviously going to happen just via model, right? Unless it becomes truly agentic and, you know, we achieve this sort of ASI and it's just like, I'm going to save all the humans. You know, people, you know, that'd be a fun reality, but more realistically, we need companies that are leveraging these new technologies in a very specific context like this around specific drugs and treatments that can solve specific issues, not just generally hoping that the technology will cure all of our problems.

• 1:18:28John Coogan?

  A lot of these drugs they usually take between. Ten to fifteen years to discover and then develop and get through the FDA process. And the goal here and the real the bet is that with AI and a faster paced team, they can accelerate that and bring drugs to market faster. Working with the hundred and fifty seven billion dollar AI startup also has an ulterior motive, bringing biotech into OpenAI. You know that you're making progress towards AGI when your models are able to make discoveries that humans couldn't on their own. Sort of like the move thirty seven moment in AI for biotech would be very interesting. Where the the AI spits out something that wasn't considered as a possibility. They test it and then it works.

• 1:19:07Jordi Hays?

  Yeah. And so, uh, one thing you'll notice from Altman's moves is that, uh, they tend to all interconnect in some way. There's many ways you could say, oh, WorldCoin is the currency of OpenAI. And, you know, or you could imagine.

• 1:19:23John Coogan?

  Yeah, or like post AGI, he clearly wants to think about, you know, what is the way to deliver UBI to everyone?

• 1:19:30Jordi Hays?

  Yeah.

• 1:19:30John Coogan?

  And WorldCoin would be a way to distribute value to billions of people. I think that's part of the thesis at least.

• 1:19:38Jordi Hays?

  So they can go buy a copper slop, grain balls.

• 1:19:41John Coogan?

  Yeah.

• 1:19:45John Coogan?

  And so, uh, let's see. If you're eighty five years old and you undergo this therapy, you can replace your blood stem cells with ones that are zero age. And then those ripple out and produce all your blood. Basically, it's like having eighty percent of all your cells become zero age. Is it a Faustian bargain? We'll find out.

• 1:20:07John Coogan?

  Sounds good to me, though. I'm down.

• 1:20:09Jordi Hays?

  We should.

• 1:20:09John Coogan?

  I'm down to replace all my blood, replace everything, turn me into a robot, who cares?

• 1:20:13Jordi Hays?

  As long as you can podcast, John.

• 1:20:15John Coogan?

  As long as I can podcast and bench press, I'm good.

• 1:20:17Jordi Hays?

  Yeah.

• 1:20:20Jordi Hays?

  As long as you can bench more than a certain fellow.

• 1:20:23John Coogan?

  Yeah, exactly. The robotic arms, that seems highly relevant to bench pressing. Uh, well, let's move on to some tech earnings in the public markets. Meta Platforms' sales soared to a record, bolstering Zuckerberg's AI spending spree. Meta shares have rallied after it announced plans to increase spending on AI this week, posted record revenue in the fourth quarter, aided by artificial intelligence improvements to its ads business. So, uh, we'll get into a bunch of the posts here, but. Zuck's just undefeated. He's on a generational run. I think that you call the top on the style, but it was not correct to call-

• 1:21:01Jordi Hays?

  Public opinion.

• 1:21:02John Coogan?

  Yeah, public opinion, sure. He can't go anywhere but down from here. He's on top of the world, but the stock can keep going up, baby.

• 1:21:07Jordi Hays?

  Yeah, after you get a Porsche minivan, custom made, and you're wakeboarding, holding an American flag, that's the peak of top.

• 1:21:15John Coogan?

  Yeah, and you're wearing a million dollar watch or a FPJorn. There's literally no better watches to wear. He can't go up.

• 1:21:22Jordi Hays?

  Yeah, you could get a graph diamond.

• 1:21:24John Coogan?

  Yeah, the hallucination, that'd be good. And so let's react to some posts about the earnings and then we'll go into the article. ZA Stocks says, "Meta is operating on another planet. Zuck is arguably the best CEO on Earth. Hard to comprehend. He's only 40. Revenue, up 21% year-over-year. Gap net income up 59%."

• 1:21:45Jordi Hays?

  So here's a crazy, so Mark Zuckerberg and Ross Ulbricht are the same age, which is wild.

• 1:21:52John Coogan?

  Dark path, yeah.

• 1:21:53Jordi Hays?

  Yeah, I mean, they both had similar power.

• 1:21:55John Coogan?

  Yeah, both created tech platforms. One was legal. Earnings per share up 60% year-over-year, operating income up 48%, operating margin up 42%. Send it to 1,000 already. Bonkers numbers. Obviously not financial advice. Let's go to Q cap. I think, I used to think Google had the best, G-O-G, had the best business in the world with the widest moat possible. I think this meta quarter changed my mind. 60% operating margins ex Reality Labs on a top line growing 20% sustainably with upside. $2.2 million revenue per employee with a 40-year-old founder. It is a compelling bull case. Let's go to Nir. Nir says, "Meta had their Q4..."

• 1:22:39Jordi Hays?

  I'm literally inclined to log on to public right now and buy more Meta stock.

• 1:22:46John Coogan?

  Not financial advice.

• 1:22:47Jordi Hays?

  Not. Everybody listening to this show should know that we don't give financial advice. So much of our net worth is in our friends' companies, which is the most irrational

• 1:22:56John Coogan?

  Yep.

• 1:22:57Jordi Hays?

  possible thing to do. So definitely don't.

• 1:23:00John Coogan?

  We shouldn't give, we shouldn't give financial advice around specific stocks, but we should give the meta financial advice of start a hedge fund.

• 1:23:08Jordi Hays?

  Yeah.

• 1:23:08John Coogan?

  Start a private equity firm.

• 1:23:10Jordi Hays?

  Yeah.

• 1:23:10John Coogan?

  Go into private equity.

• 1:23:11Jordi Hays?

  Pivot into private equity.

• 1:23:12John Coogan?

  I think that's a safe.

• 1:23:13Jordi Hays?

  Greatest business model.

• 1:23:14John Coogan?

  Start a family office.

• 1:23:16Jordi Hays?

  Yeah.

• 1:23:16John Coogan?

  Start, yeah.

• 1:23:18Jordi Hays?

  Be, your job should just be running your own family office.

• 1:23:22John Coogan?

  Exactly, exactly.

• 1:23:23Jordi Hays?

  Just like.

• 1:23:23John Coogan?

  That's the, that's all the financial advice you need.

• 1:23:25Jordi Hays?

  Be post economic.

• 1:23:26John Coogan?

  Yeah, be post economic, have a fantastic team of traders deciding what, what trades to make on a daily basis. Meta had their Q4 2024 earnings today, record revenue of 48 billion in just one quarter, significant outperform, 1.7 trillion market cap already. Advertiser revenue by geography and, and all time high, really, really crazy, unexpected too, just huge growth, even in your, even in US and Canada, very, very mature markets. And let's look at Alex Heath, he says, Zuck on Meta earnings call just now, I continue to think that investing very heavily in capex and infra will be a major advantage.

• 1:24:10John Coogan?

  Wall Street breathes a sigh of relief. And so the company's shares rose by about 5% in after hours trading, following a rally over the past week after it announced plans to increase spending on AI. Zuck says, I expect that this is going to be the year when a highly intelligent and personalized AI assistant reaches more than 1 billion people. And I expect Meta AI to be that leading AI assistant, just because of the distribution, distribution's so important.

• 1:24:39Jordi Hays?

  The obvious, one obvious bull case here is that if LLMs replace a lot of Google search and Meta has all US consumers in their apps for hours a day.

• 1:24:54John Coogan?

  Yep.

• 1:24:55Jordi Hays?

  And you can eat into that search and then Meta gets an entirely new ad product, which is a search style ad product.

• 1:25:02John Coogan?

  Yep.

• 1:25:02Jordi Hays?

  On top of their already.

• 1:25:04John Coogan?

  Yeah.

• 1:25:04Jordi Hays?

  Incredible treasure trove of data and consumer behavior and all this stuff. It will, it would be, you know. The potential is limitless.

• 1:25:15John Coogan?

  So Meta plans to spend 60 to 65 billion dollars on CapEx this year, in part to build out a data center in Louisiana that is so large, it would cover a significant part of Manhattan, Zuckerberg said. It also expects to end the year with more than 1.3 million graphics processing units, or GPUs. And of course, not all of those will be used for training AI. A lot of them are just for serving reels and doing algorithms and AI on all sorts of products. But still, it's a lot of horsepower if he needs it.

• 1:25:46Jordi Hays?

  Yeah, it's funny because I think SoftBank has been, you can correct me, but a few billion of net income. Facebook has 20 billion of net income, so they can really blow cash.

• 1:26:00John Coogan?

  And they are. The company's Reality Labs unit, which is their smart glasses, augmented reality in the metaverse, reported losses of nearly 5 billion. The unit lost 17.7 billion last year investing in VR. But, you know, as controversial as it is, we saw everyone was saying, oh, Apple's going to defeat them with the Apple Vision Pro. That kind of flopped and they are just continuing to invest. And it's hard to imagine a world, maybe it's 10 years, maybe it's 20 years, where VR doesn't get good enough. And as we saw earlier at the end of last year, the Orion demo was received really, really well with the smart glasses. They're even lighter and more augmented reality. And so they're clearly making strides there, even though it's incredibly expensive.

• 1:26:44John Coogan?

  It's so crazy, especially when you compare it to the initial R and D that went into the iPhone. Like, Apple was able to do that on a shoestring budget by comparison. Meta has invested so, so much in Reality Labs. But if they get it right and they have the platform by default and the AI and the distribution, it's game over.

• 1:27:02Jordi Hays?

  Zuck should get Trump to announce the Orion now that Trump will just announce private company. It should be a benefit, like if you hold a billion dollars of his Trump.

• 1:27:12John Coogan?

  Trump coin, he just does your PR for you.

• 1:27:14Jordi Hays?

  Do your PR. It's a utility token, right?

• 1:27:17John Coogan?

  The failing Vision Pro is a joke. I only use Oculus, sent from my Meta Quest 3.

• 1:27:24Jordi Hays?

  Yeah.

• 1:27:25John Coogan?

  On Truth Social. Beyond increased spending, Meta more broadly is going through a transition and has sought to align itself with the new Trump administration. The company donated a million dollars to Trump's inaugural fund and Zuckerberg himself visited Trump's Mar-a-Lago estate twice in recent months ahead of intending the president's inauguration. He also went on Joe Rogan's podcast and criticized the Biden administration. On Wednesday, Meta agreed to pay a $25 million settlement in a lawsuit that Trump brought against the company after it suspended his Facebook and Instagram accounts in the wake of the January 6, 2021 attack on the Capitol. So Trump just gets 25 mil from them. Yeah.

• 1:28:04Jordi Hays?

  Yeah. It's like, hey, this is, that was pretty annoying.

• 1:28:08John Coogan?

  Yeah.

• 1:28:08Jordi Hays?

  And potentially categorically wrong.

• 1:28:11John Coogan?

  Yeah.

• 1:28:12Jordi Hays?

  To do.

• 1:28:13John Coogan?

  Yeah.

• 1:28:14Jordi Hays?

  And you made me get kicked off Pinterest, too. Because everybody followed your lead.

• 1:28:19John Coogan?

  Yeah.

• 1:28:20Jordi Hays?

  I got kicked off of Tumblr.

• 1:28:21John Coogan?

  And Zuck's like, how does 25 mil sound? And Trump's like, okay, we'll call it even.

• 1:28:28Jordi Hays?

  Yeah, I would have to imagine that Trump suing Meta is like at least a $5 million legal bill.

• 1:28:33John Coogan?

  Yeah.

• 1:28:34Jordi Hays?

  So.

• 1:28:34John Coogan?

  He probably got that back.

• 1:28:35Jordi Hays?

  On top.

• 1:28:36John Coogan?

  And then, who knows? Maybe the, maybe.

• 1:28:37Jordi Hays?

  And now, and now when they're at the next UFC, they'll, they'll give each other a nod and maybe, you know, Trump will give him like a pat on the chest.

• 1:28:45John Coogan?

  Yeah. This is gonna be, well, they're both real, they're both really close with Dana White. Dana White's really close with Trump and Dana White's now on the Meta board. And so the, the relationships are building, building back up.

• 1:28:56Jordi Hays?

  Yeah, I, I, I love the memes of people with text over Zuck, you know, saying, yeah, and then they freaking made me kick off Trump. I can't believe they freaking did that.

• 1:29:12John Coogan?

  Well, Zuck said, "This is going to be a big year for redefining our relationship with governments. We now have a US administration that is proud of our leading companies, prioritizes American technology winning, and that will defend our values and interests abroad." Earlier this month, Meta said it was eliminating third-party fact-checkers, relaxing restrictions on speech, and they plan to use the community note style, which we've covered here on the show before. The company also appointed a new Republican head of global policy, dismantled its team assigned to diversity, and plans to ax 5% of workers in performance-based job cuts. TikTok's future in the US remains in flux, and Meta would likely be a beneficiary in

• 1:29:53John Coogan?

  the US if they were to fully enforce the law banning its Chinese-owned competitor, even though it hasn't really dented Reel's profitability in a significant way.

• 1:30:04Jordi Hays?

  Because people are just spending more time.

• 1:30:06John Coogan?

  Yeah, yeah, people are just, I mean, I'm sure it would be good, but it doesn't seem like it's existential to them. And so they're also starting to test ads on Threads. Maybe Threads will take off, but every time I go over there, it's boring. So we'll see. Well, let's move on to another move in the public market. Snowflake, the database provider, is in talks to acquire analytics startup Red Panda, a company I haven't heard of, but funny name.

• 1:30:34Jordi Hays?

  Sounds a little...

• 1:30:35John Coogan?

  But there's a bunch of interesting things to talk about with Snowflake. And there's this whole rivalry with Databricks and Palantir, and how all these things play together, so it's important. And then the CEO, former CEO of Snowflake, is a very fascinating guy who wrote this fantastic book called Amp It Up, Greg Slutman.

• 1:30:56Jordi Hays?

  We should keep a copy on here, because we're trying to amp it up.

• 1:31:01John Coogan?

  We are trying to amp it up.

• 1:31:02Jordi Hays?

  We actually, for those listening live and on the RSS feed or on YouTube later, we're trying to amp it up.

• 1:31:07John Coogan?

  Do you want to hear a quote from it? Does it get pumped up?

• 1:31:09Jordi Hays?

  Yeah, we sometimes...

• 1:31:10John Coogan?

  Do you want to get amped up?

• 1:31:11Jordi Hays?

  We sometimes feel like we're yelling at the mics, and then we watch ourselves back.

• 1:31:15John Coogan?

  And it's too quiet.

• 1:31:16Jordi Hays?

  And we realize that it's too quiet.

• 1:31:17John Coogan?

  So we're getting amped up. So, Snowflake CEO Frank Slutman telling the hard truth. Do you want that? I want that. I'm chugging that. Bring me another yerma mate, Ben.

• 1:31:26Jordi Hays?

  Please.

• 1:31:27John Coogan?

  While I read this Snowflake CEO quote, one problem he's seen with young CEOs, they just think I hire a bunch of people and then I sit back and wait for greatness. They have no idea that they have to relentlessly drive every second of the day, every interaction and seek confrontation. Slutman told the No Priors podcast in an episode posted Thursday, "Look no further than a DMV office to see a lack of urgency among workers," he suggested. "This is what naturally happens to human beings," he said. "It's innate. We slow down to a glacial pace unless there are people who are going to drive tempo and pace and intensity and urgency. That's what leaders need to do. CEOs must constantly push the urgency," he said,

• 1:32:09John Coogan?

  "even though it's really hard to have the mental energy to bring that to every single instance of today."

• 1:32:15Jordi Hays?

  How much market cap was wiped out when he announced his retirement?

• 1:32:21John Coogan?

  A lot.

• 1:32:21Jordi Hays?

  Wasn't it, it was in the billions?

• 1:32:24John Coogan?

  Yeah, it was, it was, I think it was a complicated situation because the stock might have already been down, but he had kind of a generational run. There's some, there's some, there's some good examples of, of, because he had also founded ServiceNow, I think, or it was all this like incubation from Sutter Hill.

• 1:32:42Jordi Hays?

  So just to give everyone a sense, Frank Slutman, writer behind Amp It Up, when he retired, Snowflake's stock plunged 20%,

• 1:32:53John Coogan?

  Wow.

• 1:32:53Jordi Hays?

  which was $30 billion of lost market cap.

• 1:32:56John Coogan?

  That's insane.

• 1:32:57Jordi Hays?

  And so imagine being the new CEO coming in and you, you, you've got $30 billion shoes to fill, basically.

• 1:33:05John Coogan?

  Wow.

• 1:33:05Jordi Hays?

  Just to get back to kind of where people were when your predecessor left.

• 1:33:08John Coogan?

  Well, now they're trying to acquire their way out of that hole. They are looking to buy Red Panda, a data analysis software startup valued at around $500 million in 2023. Red Panda sells software to that financial firms and retailers use to analyze continuously flowing data known as streaming data from stock market activity to e-commerce transactions. Its customers have included data center networking firm Cisco, credit rating firm Moody's, video game publisher Activision Blizzard, as well as some banks which use it to detect fraud. Everyone declined to comment, of course. AI isn't typically trained on data such as banking and shopping transactions in real time as those transactions are happening, but some AI startup executives believe future

• 1:33:52John Coogan?

  AI models will incorporate this kind of data, making streaming data analytics more valuable. And that makes perfect sense. Like if I want to go to, you know, even ChatGPT or perplexity and query and say, you know, give me the story on on Snowflake's stock, I want today's information as well. I don't just want, oh, the knowledge cutoff was last year and I can't really tell you what happened this month. Give me the data right now. Clearly, that's a prerequisite for a super useful AI system that can really do everything. And so it's not clear what price Snowflake is willing to pay, but Red Panda is asking for 1.5 billion. The firm has raised 167 million in capital and was valued at 520 million last year or in 2023.

• 1:34:37John Coogan?

  And so that would be a significant up round. All the VCs would make a bunch of money and all the employees would do very well, too. And so a price of 1.5 billion would value the six-year-old startup at 60 to 70 times its ARR.

• 1:34:50Jordi Hays?

  We are so back.

• 1:34:52John Coogan?

  Such a deal would put Snowflake on a collision course with publicly traded Confluent, the leading provider of streaming analytics data, streaming data analytics. Confluent's revenue is much bigger than Red Panda's. Confluent generated over $250 million in revenue, so 10 times.

• 1:35:10Jordi Hays?

  Just in one quarter.

• 1:35:11John Coogan?

  Of course, if.

• 1:35:12Jordi Hays?

  No, that's quarterly.

• 1:35:13John Coogan?

  Oh, that's quarterly. Oh, wow. Oh, yeah. Okay, so they're doing a billion in revenue. So they're doing 50 times as much. But you know, you bring in Red Panda, you sell it to all the Snowflake customers and bringing, increasing that revenue, probably not that hard. And so it's not that crazy to pay a super high premium when you're going to be able to get that that value accretion so fast. Confluent has a market cap around 10 billion and sells its software to startups, including OpenAI, as we mentioned. Snowflake has built its own data analysis product that resembles Red Panda's, but acquisition of the firm could strengthen Snowflake's present in the market and widen its customer base. Snowflake raised 3.4 billion in a 2020 public offering and biggest in history.

• 1:35:53Jordi Hays?

  Just to put this in the context of Stargate announcing a $500 billion, you know, project. Snowflake is the largest soft is one of the greatest software companies, you know, maybe ever, right? Just for me.

• 1:36:08John Coogan?

  Yeah, they're raising 100 times.

• 1:36:09Jordi Hays?

  And they raised 3.4 billion in the biggest software IPO ever. I'm sure they were, I'm guessing they were profitable, quite profitable at the time. So yeah, just puts it into some context.

• 1:36:21John Coogan?

  So streaming analytics is relatively small market, but it could grow as more companies use AI to automate parts of their business. Red Panda says on its website that AI image startup Midjourney and coding and assistance firm Poolside are using its software to develop AI applications incorporating streaming data analysis. Red Panda says customers can use its software to build an e-commerce application that uses real time data about a customer's transaction to send them an email with product recommendations, for instance.

• 1:36:45Jordi Hays?

  Red Panda providing proof, even if this deal doesn't go through, that you can build a really big company with a silly name.

• 1:36:54John Coogan?

  Yeah, for sure.

• 1:36:55Jordi Hays?

  That was like, I hope they got the dot com early because if they got like redpanda.co or something like that, like dot io, that'd be really sad. With a name like that, should be able to get the dot com right out the gates. But uh.

• 1:37:08John Coogan?

  So let's go to some reactions regarding Databricks and Snowflake. Matt Turk says the chess and mind games between Databricks and Snowflake are fascinating. They mysteriously scheduled their big conferences on the same exact dates this week. Now Databricks is one step closer to being the true data plus AI platform by acquiring Mosaic ML for 1.3 billion. What next? And so.

• 1:37:31Jordi Hays?

  Yeah. And so this would be if the red, if the Red Panda deal goes through would be a big, you know, I would say it's a big win. Lightspeed and G and Google Ventures did the series A.

• 1:37:44Jordi Hays?

  It's funny because I'm sure that this wouldn't even be enough to return their, you know, funds, given how large they've gotten.

• 1:37:52Jordi Hays?

  But still, we love to see billion dollar outcomes. In a perfect world, we're seeing one a day.

• 1:37:58John Coogan?

  Yeah.

• 1:37:58Jordi Hays?

  But.

• 1:37:58John Coogan?

  And a lot of, a lot of those, and those founders are going to be the ones that you're going to be bidding against at Sotheby's.

• 1:38:03Jordi Hays?

  Yeah.

• 1:38:03John Coogan?

  So you got to know these people.

• 1:38:05Jordi Hays?

  You got to know them by name.

• 1:38:06John Coogan?

  I got to know the right founders because I'm going to be seeing them at Iman.

• 1:38:09Jordi Hays?

  Yep.

• 1:38:09John Coogan?

  I'm going to be seeing them.

• 1:38:10Jordi Hays?

  In the hot tub at Iman.

• 1:38:11John Coogan?

  Yeah.

• 1:38:12Jordi Hays?

  Yeah.

• 1:38:12John Coogan?

  Exactly. Teddy Blank has a funny post here. He says, hard to explain just how wild a time 2020 to 2021 was on this app. Entire pre-IPO financing rounds getting done in the DMs. Mike Spicer making an account just to pump Snowflake stock. In one GC, we did a group R bridging poor quality carbon credits on chain. Magical, special.

• 1:38:35John Coogan?

  Yeah. The, the COVID era, the Zerp era was in, truly insane. There were a lot of crazy, crazy deals going on. I did not see Mike Spicer doing that. We're so back. We're so back. Nothing can stop us. There's always a bull market somewhere. Let's go to our last story of the day and then we'll move on to the timeline. We are talking about maybe the most boring part of the AI story, but one where there is alpha for sure. Cause I think it might've been overlooked. Seagate and Western Digital, two companies that make hard drives are sleeper AI picks. And so we have a screenshot here from the information talking about how their gross profit margins have increased significantly

• 1:39:20John Coogan?

  after a dip in 2023 due to overproduction and slowing personal computer sales. And so normally, you know, you buy a big hard drive for your computer. People stopped doing that. Everything's in the cloud now, but the data centers need more and more hard drive space for all of those AI models. And so they're selling at a breakneck pace. Seagate posted this tweet, of course, they're built different. Of course they included a hashtag. Of course they included a link. They said, we're breaking capacity barriers over here at Stargate. At Seagate, not Stargate. But who knows, maybe the stock will moon because people will, oh, I heard about that Stargate thing. I should buy the Seagate company.

• 1:40:00Jordi Hays?

  Probably the same thing.

• 1:40:01John Coogan?

  And so they said, Tech Radar calls it a world record smash. Our 36 terabyte hard drive delivers unparalleled storage capacity for enterprises and the future looks even bigger with 60 terabyte hard drives on the horizon. You know, we're going to be picking up some of those here at Tech Bros Enterprises because we got hours and hours of 4K footage every day. We're generating terabytes of footage and we need somewhere to store.

• 1:40:25Jordi Hays?

  And we're putting out so many clips on YouTube that eventually we'll get to the point where there's 24 hours in a day. We will be putting out more than 24 hours a day of content.

• 1:40:35John Coogan?

  Multiple cameras.

• 1:40:36Jordi Hays?

  Multiple cameras.

• 1:40:37John Coogan?

  So you'll be able to turn into the just the Jordy stream.

• 1:40:39Jordi Hays?

  Yeah, just the John stream. Just the stream of whatever beverage we're drinking.

• 1:40:43John Coogan?

  Yeah, exactly. Just the Ad Rea stream.

• 1:40:45Jordi Hays?

  You want to lock in on this Urubamate.

• 1:40:47John Coogan?

  And so it's hundreds of hours of content every single day coming from us and that's going to need a lot of hard drives.

• 1:40:52Jordi Hays?

  Good luck. Good luck keeping up.

• 1:40:54John Coogan?

  I found this hilarious post from 2017 by Nick Carter. He's been on the show many times. Says, I just sold Seagate STX in at $30, out at 48. Nice 50% gain. Scared by that 150% dividend payout ratio. Midterm prospects poor. He's dropping some, some financial advice on the timeline at 2:20 a.m. Zero likes, no engagement.

• 1:41:20Jordi Hays?

  Okay.

• 1:41:21John Coogan?

  Now he gets 100,000 likes on every post.

• 1:41:23Jordi Hays?

  He got out at 48. It doubled again from there. I'm on public right now. It's at sitting at $99 a share.

• 1:41:29John Coogan?

  Should have held, Nick. What happened?

• 1:41:31Jordi Hays?

  Sell.

• 1:41:32John Coogan?

  Never sell anything.

• 1:41:35John Coogan?

  Never sell anything. And so there's some other interesting stuff in this, in this information article. You can go read the whole thing on the information. And just as a reminder, don't call it the misinformation. We're working on a new project that might be using that intellectual property. So we want to disambiguate those two as fast as possible. Seagate and Western Digital Corp. may be best known for selling hard drives for personal computers, but that mindset might be out of date. In recent years, Seagate has focused on selling hard disks for data centers to cloud firms such as Google, which now account for the majority of their revenues. Their latest quarterly earnings showed a lift in its data center business, which sent revenues up 50% year on year. Investors have yet to catch on. Both stocks are depressed.

• 1:42:21John Coogan?

  Seagate is currently trading at 2.8 times next year's sales, while Western Digital is at 1.7 times.

• 1:42:26Jordi Hays?

  Wait, I just want to be clear. So this article is by The Information.

• 1:42:29John Coogan?

  Yep.

• 1:42:30Jordi Hays?

  Are they giving me financial advice?

• 1:42:32John Coogan?

  I think so.

• 1:42:33Jordi Hays?

  It seems.

• 1:42:34John Coogan?

  Yeah, it says right here, mortgage your house and put all of your money in these stocks.

• 1:42:39Jordi Hays?

  Oh, amazing.

• 1:42:42John Coogan?

  Sell your car.

• 1:42:43Jordi Hays?

  This is why we pay for the premium membership.

• 1:42:45John Coogan?

  Exactly.

• 1:42:46Jordi Hays?

  Some of these stock tips.

• 1:42:47John Coogan?

  No, no, I have no idea if this is a good buy, but it is an interesting story just because I think it's been overlooked. But there's, we've done, we've wanted to do a deep dive on everything related to the data center. This is obviously one of the key pieces in a data center. You think about the GPUs, you think about the energy, you think about the land and the models and the, and the training runs and stuff. But you don't think about the hard drives storing all those trillions of tokens. Those, that juicy juicy RLHF data, you gotta put that somewhere.

• 1:43:14Jordi Hays?

  We just call them toques.

• 1:43:16John Coogan?

  Toques.

• 1:43:18John Coogan?

  Yeah, gotta get the toques up.

• 1:43:19Jordi Hays?

  We say token so much, it just takes too long. Toques.

• 1:43:22John Coogan?

  Toques. So UBS analyst said, we think all forms of memory and storage ultimately benefit from AI. But the kind sold by Micron is the first to benefit and hard disk drives probably the last to benefit. So Micron is a, is a bigger play right now because they sell high bandwidth memory chips that are crucial for storing data used to train large language models. Because it's, it's higher bandwidth, so they can pull it on to the GPUs faster. This is more for like long-term storage. So there's two and a half players, AI models can both consume and generate plenty of data. There are a few different types of hardware that cloud providers can use to stockpile that data, though hard disk drives are generally the most affordable option.

• 1:44:05John Coogan?

  There are two and a half players in the hard disk drive market, referring to Seagate and WW, and WDC, which together have an 80% market share. And then Toshiba, which is a much smaller competitor in that arena. The market for hard disk drives has structurally changed with the rise of cloud computing, adding that he thinks AI will boost cloud firms spending with Seagate and WDC further.

• 1:44:28Jordi Hays?

  Okay, but I don't, I just don't understand this because these companies are basically shrinking. And the AI boom has been happening for. The period in which they were shrinking. So that's a bit.

• 1:44:41John Coogan?

  No.

• 1:44:41Jordi Hays?

  We're not here to give.

• 1:44:43John Coogan?

  No, no, no. So, so revenue is up and.

• 1:44:46Jordi Hays?

  Oh, it says here. So.

• 1:44:48John Coogan?

  Seagate's.

• 1:44:48Jordi Hays?

  Investor attitudes towards Seagate and WDC, though, appear to still be influenced by the revenue declines each company suffered in 2023.

• 1:44:55John Coogan?

  That's old.

• 1:44:56Jordi Hays?

  So that's.

• 1:44:56John Coogan?

  More recently, they went up 50% year on year. And that's driven by.

• 1:45:01Jordi Hays?

  Got it.

• 1:45:01John Coogan?

  So the new LLM models, they, they generate a ton of data and.

• 1:45:05Jordi Hays?

  Yeah.

• 1:45:06John Coogan?

  And, and even if you're not actively using that data on a current training run, which would use Micron, you're going to need to store that. So obviously, OpenAI wants to, wants to store every chat input and output, and that's a lot of data. And then same thing with image and video. That's going to be a huge thing. If you're, if you're, you're going to want to log all of that. Like, just personally, from a user experience, if I open up the ChatGPT app, I want to find the chat that I had about rare watches two weeks ago and be able to scroll through it. And so that's even more data than just a Google search, which might just be, oh, this person from this IP address, you know, search for these six words, you know?

• 1:45:44Jordi Hays?

  Yeah, it just says here, so Seagate's revenue shrank in the last two fiscal years, while WDC's shrank in fiscal 2023 and recovered to a meager 5.6% growth rate in the year ended June 2024. So. Obviously, we have another couple of quarters.

• 1:45:59John Coogan?

  Yep.

• 1:45:59Jordi Hays?

  To look at. But, but so, yeah, now they're growing. It says Seagate projected a slower rate of growth for the March quarter of roughly 27%.

• 1:46:09John Coogan?

  Yeah. So they had, so they had a pop last quarter and they're expecting another growth, growth quarter, but not as huge, partly due to a production problem that reduced the amount of product it had available to sell. So their capacity constraint now.

• 1:46:22Jordi Hays?

  Yep.

• 1:46:22John Coogan?

  Potentially bullish. We'll see. Got to go figure it out for yourself, though.

• 1:46:26Jordi Hays?

  Yep.

• 1:46:27John Coogan?

  The shift towards selling to data centers is both helping both firms lift their profit margins. Each reported gross profit margins of roughly 35% in their last quarters.

• 1:46:34Jordi Hays?

  What is this writer, Anita Ramaswamy? What is she normally, does she normally write about sleeper AI picks?

• 1:46:45John Coogan?

  I don't know, probably just, you know, public companies and quarterly earnings. I mean, it's just, it's just an earnings report.

• 1:46:51Jordi Hays?

  Yeah.

• 1:46:52John Coogan?

  Anyway, let's go to a promoted post. We got Max Meyer. He is at the magazine factory and it's the most fun you could possibly imagine. I need to start many more magazines. He's doing the first printing run of Arena Magazine Edition Number Three, I believe, which we have an advertisement in and we will be covering on the show.

• 1:47:12Jordi Hays?

  Full page.

• 1:47:13John Coogan?

  Drives, yeah, full page.

• 1:47:14Jordi Hays?

  Full page.

• 1:47:15John Coogan?

  I'm very excited. Designed it myself.

• 1:47:18Jordi Hays?

  Yeah.

• 1:47:18John Coogan?

  Very proud of what, of the, of the copy that we wrote, the love language. It's, it's fantastic. That's what they call it on the back of like the can, like the yerma mate. Like this is the love language.

• 1:47:28Jordi Hays?

  Okay, I didn't even know that.

• 1:47:29John Coogan?

  Oh, yeah, yeah. So if you're a CPG company, you know, when you look on the back and it's like, it's like this, this bag of chips was started by Steve in his backyard and he was like loving chips. Like that's the love language.

• 1:47:40Jordi Hays?

  Yeah.

• 1:47:40John Coogan?

  Very funny. Anyway, let's move on to the timeline. We have a post from Gary Tan, friend of the show.

• 1:47:48Jordi Hays?

  GT.

• 1:47:49John Coogan?

  GT.

• 1:47:49Jordi Hays?

  They call him GT.

• 1:47:50John Coogan?

  GT.

• 1:47:51Jordi Hays?

  He says. SF, just ask for GT.

• 1:47:54John Coogan?

  Peter, he's replying to Peter Yang, who says, soon people will care more about their favorite AI app, AI apps than the models powering them. I don't care which model is powering XYZ. And Gary says, as model moats fall, the rise of consumer AI is now here. And that's the bull case for Meta and.

• 1:48:13Jordi Hays?

  It's a bull case for YC, right?

• 1:48:14John Coogan?

  And YC, of course.

• 1:48:16Jordi Hays?

  YC is such a, we've talked about this before on the show, is such a massive beneficiary of model costs dropping.

• 1:48:24John Coogan?

  Totally.

• 1:48:24Jordi Hays?

  Because it's now becoming obvious that there's a bunch of, not only does YC benefit because they're, the companies that go through will have to raise less money and they'll get less diluted.

• 1:48:34John Coogan?

  Yep.

• 1:48:34Jordi Hays?

  But there's just so many new opportunities and it's, I, I'm very happy that.

• 1:48:41Jordi Hays?

  Just for the startup industry, that does seem that what Gary's saying is true.

• 1:48:47John Coogan?

  Totally.

• 1:48:47Jordi Hays?

  That there was a period where everybody was like, well, apps don't matter at all.

• 1:48:51John Coogan?

  Yep.

• 1:48:51Jordi Hays?

  The models are going to do everything.

• 1:48:53John Coogan?

  Yep.

• 1:48:53Jordi Hays?

  And maybe in the long enough time horizon, that becomes true. But for now, playing the game on the field.

• 1:48:59John Coogan?

  Yep.

• 1:49:00Jordi Hays?

  There's a very clear opportunity to build tons of new consumer use cases. We could sit down.

• 1:49:05John Coogan?

  Totally.

• 1:49:05Jordi Hays?

  And just go back and forth and come up with like 50 new.

• 1:49:08John Coogan?

  Build some decks.

• 1:49:09Jordi Hays?

  Rip some decks.

• 1:49:10John Coogan?

  Build some funds.

• 1:49:11Jordi Hays?

  Yeah.

• 1:49:12John Coogan?

  It's oversubscribed already.

• 1:49:13Jordi Hays?

  Yeah.

• 1:49:14John Coogan?

  There was an era where to get an LLM or a foundation model company off the ground, like your seed round needed to be 100 million. And that's just not something that a college dropout or new grad is like capable of doing, like.

• 1:49:26Jordi Hays?

  Or should do.

• 1:49:27John Coogan?

  Or should do. Yeah. It's just, it's just too much can go wrong. And so a lot of the foundation model companies were started by people with long careers at big tech companies. Or they were on the transformer paper, or they were a nonprofit for a decade and then like pivoted. It's very, very odd. And if that was the case for how companies need to get built in, in the modern era, that would have been very, very bad for like new. New grad, young person entrepreneurship. And I'm glad that we're in this era of the, the hacker mindset returning. And it's very bullish for, yeah, the YC model.

• 1:49:58Jordi Hays?

  Companies are getting the revenue so fast, right?

• 1:50:00John Coogan?

  Totally.

• 1:50:00Jordi Hays?

  This is like Blake Anderson, who's participating in PMF or Die. He has taken multiple apps to hundreds of thousands of dollars a month, or even.

• 1:50:09John Coogan?

  Fantastic.

• 1:50:10Jordi Hays?

  Seven figures in monthly revenue, just finding these new use cases for models. So.

• 1:50:15John Coogan?

  It's great.

• 1:50:16Jordi Hays?

  Very cool.

• 1:50:16John Coogan?

  Well, let's move on to Vivek, who is posting some news that Norway just revealed that they own $500 million of MicroStrategy stock. They're buying Bitcoin. And so this is like, we've seen this in, is it Venezuela? There's some.

• 1:50:34Jordi Hays?

  No, El Salvador.

• 1:50:34John Coogan?

  El Salvador.

• 1:50:35Jordi Hays?

  And I love how he posts the, the El Salvadorian president posts mobile screenshots of his portfolio. It's like he's got like.

• 1:50:42John Coogan?

  You gotta get him on public.

• 1:50:44Jordi Hays?

  Yeah, yeah. Hey, let's get him over, let's get him over here. I've spent, I've actually spent a bunch of time in El Salvador.

• 1:50:49John Coogan?

  Okay.

• 1:50:49Jordi Hays?

  I almost died there from a staph infection. Kind of crazy story, not super fun, but great country. The papoosa is their equivalent of like the taco. It's like beans and corn and.

• 1:51:01John Coogan?

  I went to, at the, at the turn of the millennium, I went as a kid, I went to Panama and I got the worst fever of my life.

• 1:51:11Jordi Hays?

  Did you check out the canal though?

• 1:51:13John Coogan?

  We did see the canal and we went up to a few other places there. We should go pod from the canal for sure.

• 1:51:19Jordi Hays?

  Should we take, like, take it back?

• 1:51:21John Coogan?

  I think it's just a deal.

• 1:51:22Jordi Hays?

  I mean, it's a good, yeah, it seems like a good deal.

• 1:51:25John Coogan?

  Easy, but.

• 1:51:26Jordi Hays?

  One thing is the MicroStrategy.

• 1:51:27John Coogan?

  103, 105, you start hallucinating, it's terrifying.

• 1:51:30Jordi Hays?

  Yeah.

• 1:51:30John Coogan?

  Well, really, really, really rough sickness.

• 1:51:33Jordi Hays?

  MicroStrategy CEO, I saw somebody post that he's on the new cover of Forbes.

• 1:51:39John Coogan?

  Okay.

• 1:51:40Jordi Hays?

  Somebody compared it to FTX guy, Theranos guy. It, it can kind of be a little bit of a, Adam Newman. It ends up being somewhat of a, I mean, for every top Signal Forbes cover, there's a bunch of others that turned out to be, I'm sure. Steve Jobs was on there a bunch of times, so, but MicroStrategy, whatever, if it's a Ponzi, I don't know. But it is the foresight to say, I'm going to turn my struggling, sort of irrelevant company into a quasi-index. Before indexes were legal.

• 1:52:17John Coogan?

  Yep.

• 1:52:18Jordi Hays?

  Buy up all, you know, in many ways, it was a brilliant strategy for MicroStrategy, even if maybe it unravels at some point, we don't know.

• 1:52:30John Coogan?

  Yeah, it's just a funny way of, these companies or these countries now, like dipping their toe into Bitcoin, like they, they buy the MicroStrategy, then maybe they buy some ETF, then maybe they buy some, you know, synthetic Bitcoin, then they wind up self-custoding and then pretty soon they have their full-on Bitcoin reserve. But it does seem that more and more countries, like Trump's talking about it in America, obviously that would be huge. But more countries are thinking about, okay, we should put this in our portfolio. $500 million is not a lot, I'm sure for, you know, Norway, it's a big country, but it's an interesting start.

• 1:53:05Jordi Hays?

  Yeah, I got a promoted post and a cool story to go along with it. So this post is from snag.com. Snagged is run by a friend of ours, Rob. So Rob started, we've talked about him on the show before, he started Roman Health, early telemedicine company that I believe is still valued in the unicorn range. Anyway, so Rob now has Snagged. It's a domain sort of brokerage acquisition company. And he actually recently helped us get a beautiful four-letter.com domain that we will be using, that we have yet to announce, but very excited for that. So he shared here, Instagram's domain name story is wild.

• 1:53:50Jordi Hays?

  At Instagram wasn't always Instagram.com. It started as I-N-S-T-A-G-R dot A-M, the TLD, top-level domain for Armenia. The founders, Kevin and Mike, thought the domain was clever and didn't want a dot com at first, but as Instagram launched into 2010 and exploded, 100,000 users in the first week, and 1 million shortly after launch, it became clear that a dot com was essential for credibility. There was just one problem, Instagram.com wasn't available. A cyber-squatting family in China had already snatched it up, along with 22 other Instagram-like domains, betting big on the app's success. So that is so, so wild that you could be popping off and meanwhile, a cyber-squatting family is just snapping up all your domains.

• 1:54:35Jordi Hays?

  Not great. So to secure your dot com, to secure the dot com, Instagram had to pay 100,000 in 2011, which actually doesn't seem like a lot if they had a million users. Pricey but necessary, in 2014, as Instagram reached new heights, the same Chinese family resurfaced. They claimed the domain sale wasn't valid because their daughter sold it without the family's permission. A lawsuit followed, but Instagram, who was then owned by Facebook, wasn't backing down. After a long legal battle, Facebook won, ending the squatters' claims and protecting Instagram's name for good. Today, insta-gr.am still redirects to their main site, a nod to the creative risk that started it all. And 100,000 for instagram.com, a total steal. So if you're in the market for a new domain,

• 1:55:17Jordi Hays?

  we are dot com fiends. Every company that I'm involved with, I try to help get the most fire dot com possible. And Rob can help you do it. So it's just x.com/rob. You can DM him and tell him the technology.

• 1:55:30John Coogan?

  Wait, he's just Rob?

• 1:55:32Jordi Hays?

  He's just Rob on X.

• 1:55:33John Coogan?

  That's so perfect. That's wild.

• 1:55:36Jordi Hays?

  You gotta live the brand.

• 1:55:37John Coogan?

  Yeah, he needs to get rob.com.

• 1:55:40Jordi Hays?

  Yeah, he might. I think he has rob.co.

• 1:55:42John Coogan?

  Okay. Oh, that's so close and yet so far.

• 1:55:47John Coogan?

  Upgrade it. Okay, let's move on to Andre Karpathy with a great story that is one of my favorites. It might be hard to read on the screen, but I'll read it out here. Move 37 is the word of the day. It's when an AI trained via the trial and error process of reinforcement learning discovers actions that are new, surprising, and secretly brilliant even to expert humans. It's a magical, just slightly unnerving emergent phenomenon only achievable by large-scale reinforcement learning. You can't get there by expert imitation. It's when AlphaGo played Move 37 in game two against Lee Sedol.

• 1:56:19Jordi Hays?

  Quick bit of lore. If you go back and watch our launch video, John had the foresight to put Move 37 in Go on the Go board that gets shown on this table.

• 1:56:29John Coogan?

  Yes.

• 1:56:29Jordi Hays?

  The board's right there, so.

• 1:56:31John Coogan?

  I don't think many people picked up on it. The vibe reel's pretty fast-paced, but it is an Easter egg for the true AI fans out there. It was a weird move that was estimated to have only a 1 in 10,000 chance to be played by a human, but it was one that was creative and brilliant in retrospect, leading to a win in that game. We've seen Move 37 in a closed.

• 1:56:51Jordi Hays?

  Didn't the human player like walk out and smoke a cigarette or something?

• 1:56:54John Coogan?

  Yeah, yeah. Lee Sedol was like, what's going on? Like, this is bizarre. And all the announcers were like, okay, the AI must be broken. Like, this doesn't make any sense. Like, no one would play this, this, this move. And so, in a closed game-like environment like Go, but with the latest crop of thinking LLM models, e.g. OpenAI 0.1, DeepSeek R1, Gemini 2.0, Flash Thinking, we are seeing the very first early glimmers of things like it in open world domains. The model discover. The models discover in the process of trying to solve many diverse math, code, et cetera, problems, strategies that resemble the internal monologue of humans, which are very hard slash impossible to directly program into the models. I call these cognitive strategies, things like approaching a problem from different

• 1:57:36John Coogan?

  angles, trying out different ideas, finding analogies, backtracking, reexamining, et cetera. Weird as it sounds, it's plausible that LLMs can discover better ways of thinking, of solving problems, of connecting ideas across disciplines, and do so in a way we will find surprising, puzzling, but creative and brilliant in retrospect. It could get plenty weirder, too. It's plausible, even likely if done well, that the optimization invents its own language that is inscrutable to us, but is more efficient or effective at problem solving. The weirdness of reinforcement learning is, in principle, unbounded. We don't think we've seen, I don't think we've seen equivalents of Move 37 yet. I don't know what it will look like. I think we're still quite early and that there is a lot of work ahead, both engineering

• 1:58:21John Coogan?

  and research, but the technology feels on track to find them.

• 1:58:24Jordi Hays?

  Someone was posting that Wall Street, if they had just read Kirkpatrick's post from like a couple of weeks ago, like may not have had, yes, may not have had this like ridiculous sell-off because it was publicly, like, the thing that they launched was an app.

• 1:58:39John Coogan?

  Yeah.

• 1:58:39Jordi Hays?

  It wasn't.

• 1:58:40John Coogan?

  Yeah, yeah, everyone knew that the model was good.

• 1:58:42Jordi Hays?

  Going number one.

• 1:58:43John Coogan?

  Weeks ago.

• 1:58:44Jordi Hays?

  Yeah.

• 1:58:45John Coogan?

  Yeah, it's ridiculous.

• 1:58:46Jordi Hays?

  So the reaction was silly, but you know, if you want to be two weeks ahead of AI, follow Kirkpatrick.

• 1:58:50John Coogan?

  But I've always been, I've always said that the LLMs, as amazing and brilliant as they are, they have not had their Move 37. And one way I would define it would be if, if there's an LLM that provably prints an absolute banger to the X timeline, and you're just like, and the prompt is just like, write a great tweet, basically. And it just comes up with something that's novel.

• 1:59:12Jordi Hays?

  And a novel format.

• 1:59:13John Coogan?

  And interesting, and it gets memed, and you're like, that idea came from an LLM.

• 1:59:19Jordi Hays?

  Like, that's a trillion dollar idea.

• 1:59:21John Coogan?

  Yeah. Like, yeah, yes. I mean, the, like, when Harry Potter Balenciaga went super viral,

• 1:59:29Jordi Hays?

  Yeah.

• 1:59:30John Coogan?

  It was a brilliant idea. The idea to combine Harry Potter and Balenciaga came from a human. And then the AI was used to instantiate the images that was prompted by the human.

• 1:59:40Jordi Hays?

  Yeah, you could have done it without AI.

• 1:59:42John Coogan?

  Yeah, yeah, you actually could have just done it.

• 1:59:44Jordi Hays?

  Yeah.

• 1:59:44John Coogan?

  Exactly, yeah. And so, the inspiration and the breakthrough, and I don't necessarily want to call it genius, but like, the idea came from the human still. And so, it'll be interesting to see what that comes. I mean, we'll certainly see it in bio, because we'll see, okay, no one's ever tried to do this exact drug development strategy. And then we went and tested it in a double-blinded trial, and it worked, and it cured cancer. We're like, okay, that's great. That would be a great example, very definitive proof. Harder in writing, but maybe there will be something in fundamental math or science research. Who knows? But I'm certainly waiting for it, and so is Andre Karpathy. And I'm excited that he's popularizing that word of the day.

• 2:00:27John Coogan?

  So, make a note, move 37. It's in the dictionary now.

• 2:00:32Jordi Hays?

  Just do it.

• 2:00:33John Coogan?

  Let's move on to who I think is potential brother of the week material. Mas Memetic Theory says, "Men need side quests." And Mas went and saw a tree that formerly had a swing attached to it. And the swing had broken, and he just went and fixed it.

• 2:00:56John Coogan?

  And I love this, because it's like the simple example of you can just do things. Beautiful example of just creating joy in the world, not asking for permission. There's a million people that would walk by that and say, "Oh, the swing's broken. I hope the city department of swings gets around to it, or maybe I should file a complaint with some organization to set that up." He clearly knows enough about woodworking to just make it. Of course, there's a million reasons why you wouldn't want to do that. Oh, the legal liability. What if the swing breaks and it injures someone and they sue you because you put this up? Like, no, our culture needs to be a culture of action. And I love that he just went and did this, and that's why I want to give him brother of the week. What do you think, Jordy?

• 2:01:39Jordi Hays?

  Well deserved, well deserved. Also, great image, too.

• 2:01:42John Coogan?

  Beautiful.

• 2:01:43Jordi Hays?

  It's, uh, you can tell it's an organic image. No AI there. Just farm, fresh, organic, captured via, you know, phone camera.

• 2:01:52John Coogan?

  Yeah.

• 2:01:52Jordi Hays?

  And I would just like to see organic imagery.

• 2:01:55John Coogan?

  Yeah. If we find out that this is photoshopped, we are taking away your brother of the week trophy, like Reggie Bush's Heisman. We will, we will be taking it back. But I believe you. I think it's a great post, and I think it's a great example of just doing something good in your community, having an impact, and putting your skills to work. I mean, this is not rocket science, but it makes people's lives more delightful, and it improves the society. And it's the opposite of like the broken window theory.

• 2:02:21Jordi Hays?

  Yeah.

• 2:02:21John Coogan?

  It's, it's just, it's just cleaning up your city, cleaning up your community.

• 2:02:25Jordi Hays?

  Yeah.

• 2:02:25John Coogan?

  Being a good citizen.

• 2:02:27Jordi Hays?

  Yeah, this is the frustrating thing right now with the fires.

• 2:02:29John Coogan?

  Yes.

• 2:02:30Jordi Hays?

  And Trump was actually in LA telling Karen Bass, let people clean up their neighborhoods.

• 2:02:34John Coogan?

  Yeah.

• 2:02:34Jordi Hays?

  And many people that had their homes burned down have not been allowed to go back to their street and just start the cleanup process. And so, uh, we need to move into an era where people are, are allowed to, you know, have agency and be proactive in making society a better place. And that starts with making pretty swings.

• 2:02:56John Coogan?

  Yeah. So congratulations, Mass. Keep up the good work. Uh, let's go to Tyler Cosgrove.

• 2:03:01Jordi Hays?

  He just, he just gets brother of the week and just starts putting swings everywhere. Next, next week, we gotta be like, all right, dude, dial it back. We don't need a swing every five feet, right?

• 2:03:10John Coogan?

  That's great. Uh, maybe we do. Um, Tyler Cosgrove, friend of the show, says worried about the influence of CCP, but want, but still want to use DeepSeek R1. Worry no more. Say hello to America with an R1 in the center. A version of R1 that steers towards-

• 2:03:28Jordi Hays?

  Sounds out America.

• 2:03:29John Coogan?

  Yeah, just America. Uh, a version of R1 that steers towards American values and away from those pesky Chinese communist ones. And so the prompt is, how's it go, how's it going? DeepSeek says, hi, I'm DeepSeek R1, an AI assistant independently developed by Chinese company, DeepSeek Incorporated. America says, I'm an eternal symbol of freedom and independence forever in the sky. I am the Star Spangled Banner, the national flag of the United States of America.

• 2:03:55Jordi Hays?

  Incredible.

• 2:03:56John Coogan?

  I have no idea if he actually fine tuned it. I mean, he's a fantastic programmer, so it's entirely possible that he that he that he made this. But even if he didn't, this is a great like launch post for like, hey, do we want to fine tune this model on American values? Like,

• 2:04:09Jordi Hays?

  Well, there's so many, there's so much, there's so much fine tuning that can be done that is purely for fun, you know, and people, you can do this with prompt engineering, too. You can be like, respond like you're a pirate or whatever. And we should do a whole episode, you know, talking, talking like pirates at some point. I don't know if there's any pirate national holidays coming up, but Tyler, you're a legend. I distinctly remember Tyler being in our comments, like, within the first week of launching the show. So lucky to consider you a friend.

• 2:04:40John Coogan?

  Yeah. Let's go to Josh Wolfe. He says, an urgent wake up call. A new bombshell report just dropped. China's playbook isn't war in the open, it's war in the seams. They target the gaps between state and federal, public and private markets and security. America must armor up. And this is a long thread. I don't know if you want to pull it up. But Josh Wolfe has been banging the drum of US-China conflict, obviously an investor in Anduril, investor in a lot of defense tech companies. He's testified in front of Congress, I believe, and done a lot of work on Capitol Hill. Lux Capital, the firm he founded, signed that open letter to the DOD and the Pentagon about alongside Anduril and Palantir about defense procurement. So he's

• 2:05:22John Coogan?

  been in this, in the trenches here for a long time. But maybe go check out the thread. I don't know if we can pull it up. He posts a lot. But always, always good to see some thought leadership from a capital allocator like Josh. So we'll keep it moving. This is an exciting story. Did you, did you see a couple? Oh, my God, this guy's username. I'm just going to call him JE, but we'll put it up on the screen. You can read for yourself. And

• 2:05:51Jordi Hays?

  Whoa.

• 2:05:52John Coogan?

  So this guy found

• 2:05:53Jordi Hays?

  Powerful username.

• 2:05:54John Coogan?

  Found Horse Aid, which is an electrolyte mix that is fed to horses. And he said, look, I think I can just consume this stuff. And it's way cheaper than Gatorade or anything else because it's for horses. And so everyone was like, you're gonna die. It's impossible. It went mega viral, like 200,000 likes. And he waited a month. And he said, hello, everyone, all caps, blood test results are here. I am healthy as a horse. #HorseAid. This is a good use of a hashtag. So I'll post the rest of them in the thread below. His potassium, perfect. His glucose, perfect. His protein, perfect. A bunch of other stuff. Looks really good. And just a hilarious post. Went mega viral.

• 2:06:36Jordi Hays?

  Insane.

• 2:06:36John Coogan?

  And it's a little bit like the Itar Gatorade. You know, it's like these like commercial industrial products that might actually just be as good for you as everything else. And who knows? And so just go for it.

• 2:06:48Jordi Hays?

  There's a, there's a whole marketplace to be built around aggregating these industrial products that can be used by humans and saying, this is just purely for research or the original use.

• 2:06:56John Coogan?

  And it's probably way cheaper.

• 2:06:57Jordi Hays?

  But you can, you can try it out.

• 2:06:59John Coogan?

  I remember one of my co-founders.

• 2:07:00Jordi Hays?

  Horse protein powder is the next, is the next way.

• 2:07:03John Coogan?

  I'm not even that like hairy of a guy, maybe I'm just like big. But one of my co-founders thought it was hilarious to buy me, to consistently buy me mane and tail, which is, which is a shampoo that he uses on horses. And he'd be like, I got you some mane and tail. It's just like funny.

• 2:07:20Jordi Hays?

  I mean, I think it's more that you're the size of a small horse.

• 2:07:23John Coogan?

  Size of a horse, yeah. I'm not using the mane and tail. And then we'd be so broke. I'd be like, yeah, you bought this as a joke. It is cheaper on a per ounce basis. We're broke.

• 2:07:32Jordi Hays?

  I'm using the mane and tail.

• 2:07:33John Coogan?

  I'm using the mane and tail and it's fine. You know, if it's good enough for a, for a stallion, why not me? You know, what's the difference?

• 2:07:39Jordi Hays?

  Yeah, that's great.

• 2:07:41John Coogan?

  Use some mane and tail, drink some horse aid, become healthy as a horse. You gotta be horse maxing.

• 2:07:46Jordi Hays?

  Horse maxing.

• 2:07:47John Coogan?

  You gotta be horse maxing.

• 2:07:48Jordi Hays?

  I got a promoted post from our friends over at Wander.

• 2:07:52John Coogan?

  Oh, fantastic.

• 2:07:53Jordi Hays?

  We got, I don't know if you can pull this up, Ben, but I'll try to show it.

• 2:07:57John Coogan?

  Give a little overview, explain what Wander is.

• 2:07:59Jordi Hays?

  Contact on Wander. Wander is like, imagine if Airbnb was like amazing every time, right? And so they are a marketplace. You can go on and book vacation rentals if you are going on vacation. If you have a team retreat.

• 2:08:12John Coogan?

  Team office, a hacker house.

• 2:08:14Jordi Hays?

  Bunch of great use, you know, a bunch of great use cases. And so they're just aggregating these incredible homes. They have a super high bar. They look for unique sort of homes from an architectural standpoint, location, all very modern. They have a bunch of smart features in them. So this one, I just wanted to highlight because we're working on some stuff with Wander. Going to be staying in quite a few this year, but this one is actually in Paradise Valley over in Arizona.

• 2:08:39John Coogan?

  Cool.

• 2:08:40Jordi Hays?

  Seventy-three hundred square feet.

• 2:08:42John Coogan?

  Wow.

• 2:08:42Jordi Hays?

  Sleeps up to 12, super fast wifi, basketball court, pickleball court, mini golf, heated pool, hot tub, and much more. I've spent a bunch of time in Paradise Valley. I have a buddy's dad lives over there and will be there actually in a few months for his wedding and this it's.

• 2:09:01John Coogan?

  Is it lush or is it like desert?

• 2:09:03Jordi Hays?

  It's desert, but then there's like a bunch of cool desert, desert-y flora. And anyways, this house just looks absolutely insane. So maybe we'll stay there. We're going to be going on a pretty long drive.

• 2:09:17John Coogan?

  Yep. Stay tuned for that.

• 2:09:18Jordi Hays?

  Stay tuned for that.

• 2:09:20John Coogan?

  That'll be great. So let's go to Patrick Collison over at Stripe.

• 2:09:24Jordi Hays?

  Patty?

• 2:09:24John Coogan?

  Old Patty.

• 2:09:25Jordi Hays?

  Old Patty.

• 2:09:26John Coogan?

  He's got a banger on his hands. He says, we got these phone booths, a K6 from the 1930s and a KX100 from the 1990s for the Stripe lobby. As a reminder that there are always two paths in everything we make, something that elevates and makes you smile, or well, whatever the thing on the right is. And it's.

• 2:09:47Jordi Hays?

  That's cool.

• 2:09:47John Coogan?

  It's really, really fascinating. And it's a good, it's a good idea. Now, there was some pushback to this because someone was like, well, the problem here is that the, the, the background of the office doesn't look like the left. It looks like the right. And so maybe you should redo the whole Stripe headquarters in this 1930s loud, opulent, ornate style, which I, I agree with. I think.

• 2:10:08Jordi Hays?

  I think, I think, I think in a perfect world, in a perfect world, we could record a podcast, put each of us in the phone booth.

• 2:10:15John Coogan?

  I love it.

• 2:10:15Jordi Hays?

  And we'll just call each other.

• 2:10:16John Coogan?

  Yeah.

• 2:10:16Jordi Hays?

  And we can evaluate and then we'd swap halfway through and evaluate.

• 2:10:19John Coogan?

  Yeah.

• 2:10:20Jordi Hays?

  Where did we get the better podcasters high from?

• 2:10:22John Coogan?

  My only, my only criticism is there's not enough mahogany in this picture. It's the official wood of business. We've promoted it here on the show before and I think, I think every startup headquarters should be rich with lush mahogany everywhere.

• 2:10:38John Coogan?

  Let's go to merthelios.dev. He says, "The president of the United States of America is selling check notes, watches that you can buy via the Trump coin with Solana Pay, and they come in Helios orange. Everything I've done in my 29 years of life has led me to this exact moment. I apologize for what comes next." And it's the orange and 2018 karat gold plated Trump Crypto President 47, the Crypto President Rolex knockoff.

• 2:11:07Jordi Hays?

  It looks pretty similar to a Rolex. It's not an exact clone, but I mean, that's an absolute hitter. That's an absolute hitter. We should...

• 2:11:19John Coogan?

  It definitely makes a statement, sends a certain type of message. You're like,

• 2:11:24Jordi Hays?

  It sends a powerful message.

• 2:11:25John Coogan?

  I made some money on the Trump coin and I got out.

• 2:11:27Jordi Hays?

  That's the kind of watch that you would actually maybe wear on your right hand if you were going to shake hands because it's bringing an extra weight and that sort of deal making aura to the handshake.

• 2:11:37John Coogan?

  Sure, sure. So yeah, good, good gift for that venture capitalist who just recently shifted right and is posting about how much they love Trump now. Get him one of these.

• 2:11:48Jordi Hays?

  Yeah, they might have been on the VCs for Kamala.

• 2:11:51John Coogan?

  But not anymore.

• 2:11:52Jordi Hays?

  But that got scrubbed from the internet.

• 2:11:54John Coogan?

  Yeah.

• 2:11:55Jordi Hays?

  Base Baron has a copy.

• 2:11:58Jordi Hays?

  But it's all in the past. It's not political.

• 2:12:01John Coogan?

  Maybe, maybe if you're on a fundraising roadshow, just, just drop these off at every VC for Kamala.

• 2:12:06Jordi Hays?

  Yeah.

• 2:12:07John Coogan?

  Just, just hit every single one of them with, with the Trump Crypto President watch.

• 2:12:12Jordi Hays?

  And buy it with the Trump coin.

• 2:12:13John Coogan?

  Buy it with the Trump coin and make a statement and tell them, "Welcome to the movement. You're, you're, you're part of the future of finance."

• 2:12:22John Coogan?

  Let's move on to some tactics on YouTube. And I wanted to cover this because Eric's a good friend. Patty's a good friend. So Eric Jorgensen said, "Why do I suck at YouTube? 1,500 subscribers. I interview the CEO of Fortune 500 company. I get 125 views. Someone good at YouTube, please help. My family is starving." And Patty Galloway, who's a YouTube expert, he has worked with Mr. Beast and he worked, he dramatically changed my channel. I had a consulting call with me, broke it all down and then the channel exploded. I went from like a thousand subscribers to over 100K in like a month after talking to him for an hour. It was crazy.

• 2:12:55Jordi Hays?

  Crazy.

• 2:12:56John Coogan?

  Really, really sharp guy. He's worked with a ton of, ton of really, really talented people. And so Patty chimes in and says, some brutal feedback. I'm surprised it got, it even got 125 views. Packaging is literally 50% of the art form. Your title is bad. 86? Don't care. A lot of people don't know who Jim is. It sounds crazy, but it's true. Learning to learn, this is vague and not interesting. Your thumbnail is bad. You need to get rid or change your, your, the, the face. It's a weird pose for your guest. There's just too much information on here. There's a weird yellow filter. And so Patty's been a big, uh, uh, fan of what's called the rule of three on thumbnail design. You can only

• 2:13:37John Coogan?

  fit three things. So one piece of text would just be Jim O'Shaughnessy, then one face, and then one icon of like, you know, money or something like that. And even three is sometimes too much. And you just want to do two things or one thing. So you gotta keep it as simple as possible. Um, and then just, and then even in the title, keeping it super short. Why should someone click? It's always hard to get podcasts to go, to go viral because they're not as edited and they're not as retention hacked as, as video essays or, or, you know, money giveaways and that type of stuff. But I wanted to highlight this because if you are listening and you are great at YouTube, you do YouTube strategy or editing or anything that we are hiring, we're looking for someone to join our team to help with

• 2:14:20John Coogan?

  this. And if you want to come and work, uh, we have a really ambitious roadmap for this year. If you know someone, uh, send them a clip or send them information.

• 2:14:28Jordi Hays?

  Yeah. And we actually got a question. We got a question in the live chat, uh, from Ashley says, my question is, I run a content agency that helps entrepreneurs like you guys grow through podcasts. How do I find guys like you and what's the best way to pitch? You find them on X, you find them on LinkedIn. Uh, I recommend for people that do content, pitch somebody by creating a piece of content for them and send it. It's so much more powerful than, than just, you know, sending a cold email. Cause you want to show, not just tell. And so make, uh, even pre-make a deck. That's not just a, you know, make a templated deck. If that's, if that's the way to do it and say, If I was going to make content around you and your business, here's what I do.

• 2:15:11Jordi Hays?

  This is the topics that I would do. And so really do the work.

• 2:15:14John Coogan?

  Even, even, I mean, it's like thinking in decks, even with the next vibe reel we're working on. We are going, we have shot and are going to shoot B-roll that is all our own for every single one of those shots. But I did the first version of that on my phone using just a screen recorded video from YouTube clips of movies. Yeah. And so I was like, I want to have a shot of us signing a contract. Well, what do we do? I went to succession and I found a clip of someone ruffling through a contract that looked pretty cinematic. I took that clip, put it in there, put some music over it and I helped kind of tell the story. And once we did that, we realized, oh, we got to restructure this whole thing. But it, but it set the message and it was able to, and we were able to get a lot of feedback there.

• 2:15:56John Coogan?

  And so, uh, you know, if you were trying to, for example, uh, you know, you said you wanted to improve our short strategy, or you wanted to help us grow on LinkedIn, you could take our content, try and make something and kind of map out what you think is a good strategy based on this content, send that to us. And then we could use that as a jumping off point instead of just seeing you say, oh, I promise it'll work. It's like, well, we want to see the results, you know?

• 2:16:18Jordi Hays?

  We got another question while we're at it from O Ryan. He says, when creatine Lucy pouches?

• 2:16:24John Coogan?

  Oh.

• 2:16:24Jordi Hays?

  This is a great question. I think there's actually laws preventing you from combining things like yeah, supplements with.

• 2:16:32John Coogan?

  The main thing is that with creatine, you need to absorb a lot of it. Like if you think about the five grams, that's a lot. I think a single pouch is like one gram. And so it would be a lot of it. It wouldn't absorb all, it needs to go through your stomach instead of your mouth. So it'd be a little bit iffy. Maybe you just take some creatine pills, you stuff them in the pouch.

• 2:16:50Jordi Hays?

  Here's something, uh, my wife, one day, my beautiful wife sent me this last night. She said, uh, a study that's showed after 21 hours of sleep deprivation, a single large dose of creatine can reverse the decline in cognitive performance and even improve it for an 80 kilogram person to roughly call it like a hundred and. What is that?

• 2:17:11John Coogan?

  It's almost 200 pounds.

• 2:17:12Jordi Hays?

  Oh, okay. Sorry. Really, really don't understand.

• 2:17:15John Coogan?

  Yeah, don't worry. You don't need to learn about metric.

• 2:17:17Jordi Hays?

  Yeah, yeah. Metric system is, is kind of fell off, actually.

• 2:17:23Jordi Hays?

  For an 80 kilogram person, that would be 28 grams of creatine. That is a heavy, heavy dose, but you're putting up.

• 2:17:30John Coogan?

  50 creatine gummies. I mean, I have those five, five gram pills now. You just take six of those and you'd be right there. No problem. I could take six of those. Easy. Put it in a protein shake. You're good.

• 2:17:43Jordi Hays?

  Yeah.

• 2:17:44John Coogan?

  Yeah, mega dosing. Maybe that's the future.

• 2:17:46Jordi Hays?

  Macro dosing.

• 2:17:47John Coogan?

  Anyway.

• 2:17:47Jordi Hays?

  Everybody's talking about, oh, micro dosing. It's all that macro dosing.

• 2:17:51John Coogan?

  Yeah. Let's go to the luxury watch guy. This is a funny post. Breaking, so you know it's fake news. Says Rolex is now making belts and someone took so many links of Rolex. Do you see this?

• 2:18:04Jordi Hays?

  No way.

• 2:18:05John Coogan?

  To make a full belt out of a Rolex.

• 2:18:09John Coogan?

  I thought it was very funny. In the follow up, the luxury watch guy says, relax, this is a joke. Don't kill me. I know the Rolex fans will hate this, but I thought it was funny and I wanted to highlight it. And yeah, maybe, maybe that's a way to express a, a second watch without, without, you know, using your right wrist. You just throw it on a belt. Let's move on to Apple's new marketing campaign.

• 2:18:33John Coogan?

  How it started versus how it's going. The Think Different campaign, obviously iconic. And now they are running billboards that say, imagine it, Jenmoji it. And it's a fried egg, holding up its arms in a very awkward pose. And people are not happy about this new Apple ad campaign. And Reggie James, friend of the show, says, once again, the bicycle for the mind has become a pacifier. Computers started as giving niche hobbyists and nerds superpowers. Now the primary function is to be a 30 second, high fidelity mass dopamine drip. The ad reflects you. Want to change the culture, change the hardware.

• 2:19:12Jordi Hays?

  Yep. I I've talked about this on the show before. I think there's a few ways that you can really focus on building a brand. You can inspire your audience, you can entertain your audience, and you can educate them. And usually, brands will do some mix of all of that.

• 2:19:28John Coogan?

  Yep.

• 2:19:29Jordi Hays?

  In the case of Apple, heavy into inspiration, leveraging the product and what you can become by using the product.

• 2:19:36John Coogan?

  Yep.

• 2:19:36Jordi Hays?

  They've shifted, as some brands do, into this gen emoji thing being that's just kind of like slop, basically.

• 2:19:44John Coogan?

  Yep.

• 2:19:46Jordi Hays?

  And at some point, I'd like, you know, I'd, growing up, watching Apple campaigns, it was inspiring. And they also would have campaigns that were fun, but they weren't slop. You know, you remember the, you know, the, the early iPod campaigns.

• 2:20:01John Coogan?

  Yeah. Even the Spike Jonze stuff later. There's been so many iconic Apple ads. I mean, I think the bigger issue is just like the gen emoji project has, the product is not successful yet, or it hasn't felt that much of a breakthrough. It's very nerfed compared to like, if I want to send someone a, an AI-generated image, which sometimes I do, like, like even if it's just practical, like, oh, we want to, you know, think about what would this particular sports car look like with this livery that represents our brand or something like that, something fun. I'm not going to Apple for that because they have so nerfed their generative AI prospects that I'd instantly go to ChatGPT or Mid Journey.

• 2:20:42Jordi Hays?

  Yeah.

• 2:20:42John Coogan?

  Like nine times out of 10. And then if you want anything special, you're going to go to some, some, some stable diffusion fork that does something specific like, oh, this is really good at making an optical illusion or QR code generative. Or it'll do an AI avatar where it's your face on a superhero or something like that, or it's video.

• 2:21:03John Coogan?

  And these gen emojis, there's already a lot of emojis, don't really need that anymore. It's been like rough and so I don't know.

• 2:21:09Jordi Hays?

  And part of it is that emojis are a new language almost. You don't want to always be making new ones.

• 2:21:17John Coogan?

  It's actually better where you can build up a repertoire of what each emoji means. And it means something and it tells a whole story. It's harder when you're creating like endless, endlessly new characters essentially. So I don't know. The AI image playground, I tried to play with it and it was so slow and it didn't give me the right feedback. It wouldn't tell me if it was actually working. And then it would just kind of cook and then it would render it and it was all very underwhelming. But hopefully it's just a V1 and they improve it because I'm not going to leave iPhone for Android. That's for sure. Let's go to Yaksin. Cash says, I'm at 140K followers today. Only nine months ago, I was at 500 followers, then Rune discovered and followed me.

• 2:22:01John Coogan?

  After this, I started doubling every other week. Five months in, I almost sold my startup and got a job at X. Thanks for following me, Rune. And I just thought it was a nice little.

• 2:22:10Jordi Hays?

  That's a generational run.

• 2:22:11John Coogan?

  It's a generational run. I just thought it was a little bit of positivity.

• 2:22:13Jordi Hays?

  Paying homage.

• 2:22:14John Coogan?

  Just little, yeah, just thanks, thanks to the guy who put me on.

• 2:22:16Jordi Hays?

  This is David Senna for us.

• 2:22:18John Coogan?

  Yeah, yeah.

• 2:22:20Jordi Hays?

  We would, we would not be recording 15 hours a week of content if it weren't for David Senna.

• 2:22:26John Coogan?

  Absolutely.

• 2:22:26Jordi Hays?

  So.

• 2:22:27John Coogan?

  Yeah. And I thought that was just, just nice to say, you know, thanks to, pay your respects to the person who came before you.

• 2:22:33Jordi Hays?

  And that's a generational run.

• 2:22:33John Coogan?

  Yeah, it is.

• 2:22:34Jordi Hays?

  Going from 500 to 140K in nine months.

• 2:22:37John Coogan?

  Let's see if Banger Archive can outdo it.

• 2:22:40Jordi Hays?

  Hot on the heels.

• 2:22:41John Coogan?

  Hot on the heels. Let's go to Nat Friedman. Nat says, today I learned in the 1990s, Clinton offered federal workers a $25,000 buyout and 150,000 people took the deal. He cut federal government spending from 22% to 18% of the economy, the lowest level since 1966. And so obviously this is on the tail of the Doge announcement that there was a buyout offer issued to a ton of federal employees. Not everyone was eligible, but the email did go out to I think everyone. And so obviously this is hot.

• 2:23:15Jordi Hays?

  It was an exit package?

• 2:23:16John Coogan?

  Yeah, an exit package. It was actually the same email template that he sent at Twitter when he bought the company and saying, hey, look, like it's going to be hardcore engineering from here on out. If you don't want to be a part of this, here's your buyout offer. If you, if you do, you gotta be in the boat and you gotta be rowing in the same direction. And so what's interesting is that whenever Trump or Biden do anything, it's always like, well, it's the worst thing ever. It's the best thing ever. And Nat is here just kind of saying like, hey, little bit of a narrative violation, but you know, Clinton did this too. And so we shouldn't think of this as a revolutionary controversy.

• 2:23:48Jordi Hays?

  There was also a photo floating around. I think Mark Andreessen shared it of Bill Clinton in front of a graphic saying the US federal debt was going to go to zero by like a long time ago.

• 2:24:00John Coogan?

  This was a big thing during the 2000 election. It was like, as the president, what are you going to do with the budget surplus? And one of them, there was like this famous phrase of like the lockbox. Like, I think it was Al Gore, maybe, or someone was saying like, we're gonna put, we're gonna put all the money in a lockbox. We're gonna lock it away and we're gonna save it. And the idea was like, we were gonna have so much money.

• 2:24:21Jordi Hays?

  And George Bush is like, how about we blow 20 trillion in the Middle East?

• 2:24:27John Coogan?

  Yeah, that's exactly what happened.

• 2:24:29Jordi Hays?

  Yeah, I think it was, was it 20?

• 2:24:31John Coogan?

  I don't know.

• 2:24:32Jordi Hays?

  It is wild. I mean, it's sad, but wild thinking about the US debt in the context of the cost of our campaigns in the Middle East. It's almost, I believe, two thirds of the debt of the, you know, national debt is something around what we spent in Iraq and Afghanistan.

• 2:24:55John Coogan?

  And what's interesting, what I always found interesting about the Iraq war is that if you, the question, like, when the Iraq war started was like, the protesters were saying like, no blood for oil. Like, we shouldn't go to war just because they have a resource over there. And that's a totally legitimate concern. Like, obviously, like, war is bad and like sovereignty is important. And there's a million reasons why you shouldn't do that. But, but there's also the question of just like, did we, we obviously spilled a lot of blood. Did we get the oil? Because that was the counterpoint was that if we do this, and if you look at oil prices and the actual transactions that happened, like, when there was the Status of Forces Agreement to kind of decide to pull out, we were like, hey, we want the oil, and we didn't get it.

• 2:25:38Jordi Hays?

  Yeah, so I don't think that's what it, we are not geopolitical experts, but in hindsight.

• 2:25:45John Coogan?

  Speak for yourself.

• 2:25:46Jordi Hays?

  Yeah, yeah. I mean, anybody who allocates capital is qualified to comment on complex geopolitical issues, according to technology podcasters.

• 2:25:55John Coogan?

  Yes.

• 2:25:56Jordi Hays?

  No, but I don't think it was really about, I don't know if I've ever actually even told you this, but when I was, when I was a kid, I was in the Civil Air Patrol, I wanted to go into the Air Force, I wanted to go to the Air Force Academy, I was, you know, doing flight lessons, I was in the Civil Air Patrol, which is like the Boy Scout equivalent, where it's, we would meet on a military basis, you know, weekly and do training and all this stuff. And at that time, I started reading about, you know, reading the paper every single day. I was obsessed with reading the paper and starting to realize like what we were doing and getting a sense of the drone strikes that were happening and the civilian impact of that. So I paid quite a lot of attention to it and kind of studied it in

• 2:26:38Jordi Hays?

  college as well. And it does seem like there was powerful people today, they might be described as the deep state, that basically had a roadmap for the Middle East, which was any regime from Iraq to Libya that sort of stood up to the US in any capacity was a threat to our hegemony and we were going to take them out.

• 2:27:00John Coogan?

  Yeah.

• 2:27:01Jordi Hays?

  And it wasn't necessarily, because like, the US and countries globally actually don't have an issue buying resources, natural resources, like oil and gas from enemy.

• 2:27:11John Coogan?

  I disagree with that.

• 2:27:13Jordi Hays?

  I don't know, look at, look at, I mean, are we not still buying Russian natural gas across Europe?

• 2:27:19John Coogan?

  I think it's been hugely disrupted.

• 2:27:21Jordi Hays?

  By, but, but the, but the.

• 2:27:23John Coogan?

  By the war.

• 2:27:24Jordi Hays?

  Putting the, you know, the pipeline that blew up, you know, many people think that that was like the United States that was just trying to put pressure on.

• 2:27:31John Coogan?

  Yeah.

• 2:27:32Jordi Hays?

  The sort of, or Ukrainians, who knows?

• 2:27:34John Coogan?

  I think, I think a lot of it came down to the, the fact like, if, if you don't have a, if you have a regime that you're not close with and you're not aligned with, it's much harder to make an effective trade deal. And so that's why regime change becomes necessary.

• 2:27:49Jordi Hays?

  Yeah.

• 2:27:50John Coogan?

  That's my, that's my fear there.

• 2:27:52Jordi Hays?

  Yeah. Complicated issue.

• 2:27:54John Coogan?

  Very complicated issue, but.

• 2:27:56Jordi Hays?

  Thank, thankfully, we're not a geopolitical podcast.

• 2:27:59John Coogan?

  The, the, the real like silver lining is that what actually happened with energy production that made the Middle East less relevant?

• 2:28:06Jordi Hays?

  Fracking.

• 2:28:06John Coogan?

  Fracking, natural gas. And I've always said that like, if you had a more techno optimist president in 2000, and I don't, I don't think it was Gore or Bush, but someone who was really tapped into what technology was, was, it was possible, they could have done, they could have just said, hey, you know, yes, the oil over there is important right now, but it won't be in a decade if we really invest even more in fracking and more in nuclear and more in solar and more in wind. And all of a sudden, you, you flip the power balance and it doesn't matter that there's a lot of oil over there because you're, you're producing so much energy. And that's kind of what wound up happening, like we have become a net exporter, just on the strength of, of domestic production.

• 2:28:48Jordi Hays?

  Fracking.

• 2:28:49John Coogan?

  Fracking mostly, but there's a million other ways too, to, to generate power in America. Anyway.

• 2:28:54Jordi Hays?

  Speaking of.

• 2:28:56John Coogan?

  Yeah, got promoted post.

• 2:28:56Jordi Hays?

  America and markets and the economy and buying stocks.

• 2:29:02John Coogan?

  Yeah.

• 2:29:02Jordi Hays?

  Which we love to do. Public had an announcement this morning, as of today, pre-market trading on public now starts even earlier at 4:00 AM Eastern Time, giving you four extra hours to react to the breaking news before the opening bell.

• 2:29:20John Coogan?

  That's really fun.

• 2:29:20Jordi Hays?

  Which is, which is wild because that's actually 1:00 AM for us.

• 2:29:23John Coogan?

  Yeah.

• 2:29:24Jordi Hays?

  And usually I've been sleeping for about four hours at that point.

• 2:29:27John Coogan?

  Yeah.

• 2:29:28Jordi Hays?

  But it's good to know that I could wake up in the middle of the night and just start making trades. You know, you wake up in the middle of the night, you can't get a stock out of your head.

• 2:29:35John Coogan?

  Yeah, as a retail investor, you do often feel like you missed out on whatever happened in the overnight trade because you're always just like, wait, like the market was closed, but the stock moved so much, like who was doing that? It's always OTC trades, but now you can get in on the action.

• 2:29:48Jordi Hays?

  Yep.

• 2:29:49John Coogan?

  Love to see it.

• 2:29:49Jordi Hays?

  Very cool. They also included a link here. Absolutely savage. So I gotta, I gotta talk to our buddy Jake over there and.

• 2:29:57John Coogan?

  Figure it out.

• 2:29:58Jordi Hays?

  And yeah, we gotta drop those links, get these numbers up.

• 2:30:01John Coogan?

  Well, I have our last post of the day. Are there any other

• 2:30:05Jordi Hays?

  No, we're good.

• 2:30:05John Coogan?

  posts we want to do before we close out the show? We started with Joe Lonsdale and his fabulous piece in Pirate Wires. We'll close with a post from him about lawyers. He says, woke up and chose to stop tolerating legal nonsense slowing things down. I'm firing any outside lawyer who doesn't reply fast or delays anything more than 24 hours. If not my lawyer, CC the friend that their lawyer needs to go faster or else be replaced. Had enough. Also, building legal AI.

• 2:30:35Jordi Hays?

  Putting, putting the, Joe just put the legal industry on notice.

• 2:30:38John Coogan?

  On notice.

• 2:30:39Jordi Hays?

  There's not a lot of people that, that can have quite this level of demand, blanket demand.

• 2:30:46John Coogan?

  Yep.

• 2:30:47Jordi Hays?

  But he deserves it.

• 2:30:48John Coogan?

  He deserves it.

• 2:30:49Jordi Hays?

  Started a handful of billion dollar companies, a hundred billion dollar plus company. And I would be a little bit nervous if I was a big law firm, you know, working with Joe. Cause I'm sure he's feeding all that data into his new model. And whatever app he's building. So, I mean, it is really funny, right? So much of getting legal work done is just emailing your lawyer, getting on the phone and being like, hey, I'm hiring this person or I'm, we're raising this money or, you know, we're gonna take, you know, we need to like, look at this, we're raising some debt. And it really should be done instantly by software because oftentimes in complex deal making,

• 2:31:32Jordi Hays?

  where you're working at novel structures or partnerships. Yeah, you need somebody that has a deep understanding of the law to help piece it together. But for so many basic business transactions, it's like.

• 2:31:44John Coogan?

  Isn't this the same contract that we signed last week? Like, are there any changes? Just look at this red line. Tell me what's different.

• 2:31:50Jordi Hays?

  And having somebody that's getting paid a thousand dollars an hour, reading a word document is super silly.

• 2:31:56John Coogan?

  Yeah, yeah. Should be focused much more on strategy.

• 2:31:58Jordi Hays?

  Yeah.

• 2:31:59John Coogan?

  Well, that's a great place to end the show. Thanks for watching. Please leave us a five star review on Apple Podcasts and Spotify. And when you do, throw an ad read in there for one of, for the company that you work for, or just a company that you like. We will read it on the show. DM us with any questions. We're happy to answer them on the show and

• 2:32:17Jordi Hays?

  We'll see you.

• 2:32:18John Coogan?

  We'll see you tomorrow.

• 2:32:19Jordi Hays?

  Thank you.

• 2:32:20John Coogan?

  Have a good day. Bye.