China's AI Push Sounds Alarms, Airplane Seat Debate, Chris Best Joins | Ferdinand Dabitz, Kaiwei Tang, Steven Schwartz, Katie Roof, Zavain Dar, Chad Edwards

(01:58) - China's AI Push Sounds Alarms (36:37) - Should You Recline Your Airplane Seat? (42:47) - 𝕏 Timeline Reactions (51:39) - Ferdinand Dabitz, the 25-year-old CEO of Augustus Bank, discusses the company's recent $180 million Series B funding round, which elevated its valuation to $1 billion. He highlights Augustus's mission to "dollarize the world" by modernizing correspondent banking through AI and stablecoin technologies, aiming to provide efficient dollar access globally. Dabitz also emphasizes the strategic importance of dollarization in enhancing U. S. soft power and combating inflation. (58:53) - Kaiwei Tang, co-founder and CEO of Light Phone, discusses the company's mission to create minimalist mobile devices that help users disconnect from the attention-driven economy of traditional smartphones. He emphasizes the importance of technology serving as a tool without exploiting user attention, highlighting features like calling, texting, and music playback without ads or data tracking. Tang also notes a growing trend among younger generations seeking simpler devices, indicating a shift towards more intentional technology use. (01:12:30) - Chris Best, founder and CEO of Substack, discusses the proliferation of AI-generated content, or "slop," on the internet and its impact on reader trust. He emphasizes the importance of transparency in content creation, advocating for clear disclosure when AI tools are used to maintain authenticity and value. Best also highlights Substack's commitment to fostering genuine human connections and perspectives, believing that as AI-generated content becomes more prevalent, the value of trusted human-authored content will increase. (01:32:38) - Steven Schwartz is the co-founder and CEO of Whop, a platform that enables creators, developers, and online businesses to sell digital products, software, communities, and memberships. He focuses on building infrastructure for the internet economy, helping entrepreneurs monetize digital businesses through a unified marketplace and payments platform. (01:54:08) - Katie Roof, editor at Business Insider, discusses her recent appointment and the publication's strategic shift towards more exclusive content under Editor-in-Chief Jamie Heller. She highlights the increasing competition in journalism, emphasizing the importance of original reporting and human skills in an AI-influenced media landscape. Roof also notes the growing public interest in AI and venture capital, underscoring the need for accurate and insightful coverage in these areas. (02:02:48) - 𝕏 Timeline Reactions (02:10:31) - Zavain Dar, co-founder of Dimension, discusses the firm's recent $800 million fundraise, bringing their total assets under management to $1.65 billion. He highlights Dimension's focus on investing at the intersection of technology and life sciences, supporting companies that integrate computing with biology. Dar also addresses the evolving landscape of biotech, emphasizing the role of AI in drug discovery and the redefinition of disease treatment, while cautioning against the unregulated use of peptides and hormone mimetics. (02:23:18) - Chad Edwards, co-founder and CEO of CuspAI, a Cambridge-based AI startup, discusses the company's mission to revolutionize materials discovery through generative AI, enabling the rapid development of new materials for applications like semiconductors and climate technologies. He highlights their recent $450 million Series B funding, valuing CuspAI at $2.6 billion, with investors including Jeff Bezos' Bezos Expeditions, Kleiner Perkins, and NEA. Edwards also explains their innovative business model, securing royalties in customer contracts to share in the commercial success of the materials developed using their platform. TBPN is made possible by: Ramp - https://ramp.com Public - https://public.com Cisco - https://www.cisco.com Console - https://www.console.com CrowdStrike - https://www.crowdstrike.com Figma - https://www.figma.com MongoDB - https://www.mongodb.com NYSE - https://www.nyse.com Railway - https://railway.com Shopify - https://www.shopify.com Codex - http://openAI.com/codex Follow TBPN: https://TBPN.com https://x.com/tbpn https://open.spotify.com/show/2L6WMqY3GUPCGBD0dX6p00?si=674252d53acf4231 https://podcasts.apple.com/us/podcast/tbpn/id1772360235 https://www.youtube.com/@TBPNLive

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

• 0:00John Coogan?

  You're watching TVP and today's Tuesday, July 21st. We are live from the TVP and the Temple of Technology, the Fortress of Finance, the capital of capital. Let me tell you about ramp.com. Time is money. Save both easy use corporate cards, bill pay, accounting, and a whole lot more all in one place. We got a sponsor collab. Privy teaming up with Ramp to launch a stablecoin accounts powered by Privy. Congrats to both teams. We also have some other news from Grant folks coming on the show later this week. Very excited to chat with them. Anyway, China, China, China, China is in the news.

• 0:40Jordi Hays?

  But first, should we go through the lineup?

• 0:41John Coogan?

  Yeah, please.

• 0:42Jordi Hays?

  We have Ferdinand de Bits from Augustus coming on to raising $180 million, series B to billion dollar valuation. Kai Wei from Lightphone is launching a 299 light.

• 0:57John Coogan?

  They're calling it the dumbest dumb phone. It's our dumbest dumb phone ever. Actually, it's slightly less. It's a less dumb phone. It's a smarter dumb phone. It might be the smartest dumb phone. We'll see.

• 1:08Jordi Hays?

  And then we got Chris Best from Substack coming on to talk against his war on slop. They're partnering with Pangram.

• 1:15John Coogan?

  He's the best.

• 1:16Jordi Hays?

  Excited about that. Then Stephen Schwartz from WAP Live in the Ultra Dome on launching their new WAP CLI. And then the Roofinator, Katie Roof, the new editor over at Business Insider.

• 1:28John Coogan?

  Katie Roof. We got the paywall set up.

• 1:30Jordi Hays?

  And we do have a paywall.

• 1:31John Coogan?

  We have a paywall.

• 1:32Jordi Hays?

  We have a paywall here.

• 1:33John Coogan?

  And the golden scoop.

• 1:34Jordi Hays?

  Can we get a camera over here?

• 1:36John Coogan?

  There. We got the paywall. We're busting down the paywall for Katie Roof today.

• 1:40Jordi Hays?

  With the golden scoop. So keep an eye out for that. Then we have Zavain from Division, Dimension, sorry, and then Chad Edwards capping it off with a cool $450 million raise at the end. So stay tuned and let's get into it.

• 1:57John Coogan?

  Fantastic. Well, top American execs are sounding alarms on Chinese models.

• 2:03Jordi Hays?

  Let's give it up for top American.

• 2:05John Coogan?

  There. Yeah, let's give it up for the top American AI execs. The White House is divided on how to respond to recent advances in Chinese AI, has weighed crackdown measures. We talked about how this was coming. It is interesting. There's a, there's, there's a lot of like, you know, hurry up and pedal to the metal and then pull back and then ban the American model and then are we going to ban the Chinese model in a similar way? And lots of contradictions, lots of insider baseball. Everyone's critiquing everyone else. Lots of interesting takes. Also just some interesting data about what's actually going on with these models. How advanced are

• 2:46John Coogan?

  they? Where do they come from? How cheap are they to make? What are the economic impacts in America? But the Wall Street Journal has a nice little roundup here. We can take you through. So Silicon Valley in Washington are debating a multi-billion dollar question. Should American companies be able to use Chinese artificial, artificial intelligence models? They certainly have been able to. Hasn't been a problem for years, but now they're getting stronger. OpenAI and Anthropic executives are sounding the alarm about the rise of cheap AI, particularly powerful new models produced in China, suggesting that they will lead to, quote, "a dystopian AI future and present unacceptable security

• 3:26John Coogan?

  risks without regulation." And that is the point of debate. Are you on the side of dystopian open source or liberating open source, the George Hawes frame? Some analysis, some analysts who study the AI industry say the two companies, which are preparing for public listings in the next year, they just want to eliminate the competition. The emergence of highly capable open autonomous AI systems, including Moonshot AI's Kimi K3 model and Alibaba, Alibaba's Quen 3.8 Max. And Alibaba is actually a massive investor in Moonshot. They have their own Anthropic Google over there going on. Alibaba is like very much their, the, the Google

• 4:07John Coogan?

  too, in the sense that they, they have a large position there. Which were released in recent days and viewed favorably by investors and users has turned the AI race on its head once again. Kimi K3 was also competitive with US models on some benchmarks. The debate over the new models, which are, quote, "open weight, but not yet. They're, they're about to open source them. We'll see what happens next week." Allowing users to download and customize them with company data for specific tasks. Very, very good, very useful. Coincides with division in the Trump administration about whether to take steps to limit the use of models in the United States. Quote, "One probable outcome of an open weight model dominant world is full AI communism, which is precisely what China proposes. Rather

• 4:52John Coogan?

  than a market product, AI is a public good, which will ultimately be provided by the state as a kind of digital public infrastructure." Dean Ball, OpenAI's head of strategic futures, said in an ex post Friday. Dean Ball made it to the pages of the Wall Street Journal. Now, the AI communism is just at the model level. Like there would still be a bunch of, like, a lot of people who are long compute, long Neo cloud, they say like, this is where the value should accrue. The data centers will accrue a reasonable margin and they will still continue to make money. And so it's not that this automatically leads to nationalization of compute in any way. People would still be paid, but the, but the margins might be

• 5:35John Coogan?

  lower is, is at least the formulation here. So Ball, a former Trump administration official, called such a scenario a dystopian hellscape. And he said he expected the Trump administration to make moves toward reducing the use of open source models. Ball later clarified that he wasn't advocating for the United States government to discourage Chinese AI. He also highlighted a central challenge with the AI race. Top tier AI companies raise billions of dollars to pay for the vast computing resources needed to continue improving AI systems. If everyone uses AI systems that people largely don't pay for, there would be no way to finance continued frontier AI development. Ball, who started at the company earlier this month and focuses on policy and strategy and OpenAI, have said his comments

• 6:17John Coogan?

  don't reflect the company's official positions. He's just posting. The company has developed its own models, own open models, and chief executive Sam Altman had previously said that OpenAI's past approach of only developing closed tools was unwise. Other top AI executives have warned that open models present huge risks since developers and policymakers lack control over how they are used and modified. Lot of risk of cyber attacks, lot of risk of annoying spam attacks. The cyber thing is very concerning and annoying if that really ramps up. But the good news is that the closed source models have been available to cybersecurity firms and a lot of big, major companies. The finance industry, for example, has had access to Mythos and GPT-Cyber for almost six months. And then just today, Google announced

• 7:02John Coogan?

  a specific model, Flashlight Cyber, I think. So they're trying to offer a similar capability, but really go down the cost curve because a lot of the cyber tools, there was incredible breakthroughs with Mythos, GPT-Cyber, like great benchmarks on those, but could be very expensive. We heard, I think, wasn't it Nikesh Rora said he, I think he spent like a million dollars to find some zero day bug and it was like totally worth it, but that's expensive for smaller companies that might just need, it'd be great to just be able to go to a cheap cyber tuned model, get approved by Google and say, hey, just go and read every line of code and just let me know if there's anything that's obvious. And that could be good.

• 7:44Jordi Hays?

  Yeah. And just to be clear, they released 3.5 Flashlight and 3.5 Flash Cyber. So it's not like Flashlight Cyber.

• 7:50John Coogan?

  Okay. But Flash is still cheaper than the big model, right?

• 7:53Jordi Hays?

  Yeah. There's like the pro and then there's.

• 7:54John Coogan?

  And so I have to imagine that if you, given the choice, if you're like a midsize company, and, and, and your, and your choice is like, go beat down the door to get into Project Glasswing, to spend $5 million to have Mythos read every line of code, or you're like, oh, well, I'm already a Google partner. I have a really solid business relationship with them because I've been buying ads and I have Google Webmaster tools set up and I just want to go set up Flash Cyber, not Flashlight Cyber. I imagine that the cost would be cheaper because they fine tuned this model for the specific thing since they are benchmarking or whatever semi-analysis called them. But that's useful in this case,

• 8:35John Coogan?

  right? So Anthropic CEO Dario Amadei, for years, has worry, warned about the risks of powerful and open AI systems, saying in a recent Bloomberg interview that having AI models with advanced cybersecurity capabilities that are free to download could be harmful. He said, "It's a serious concern." Use of Chinese models, which are far cheaper than US counterparts, is surging at US companies, prompting some investors to question the staying power of top model makers such as Anthropic and OpenAI. The current US open source frontier is starting to catch up with China's. On Wednesday, Thinking Machines Lab, led by former AI technology chief Miramirati, released its fir, first AI model as open weight. Nvidia's Nematron 3 Ultra is starting to see traction. That's interesting to hear.

• 9:19John Coogan?

  I haven't heard nearly enough buzz around Nematron. I know Jensen has been investing in it. He's also investing in a lot of. You know, up and down the stack.

• 9:29Jordi Hays?

  I've been hearing buzz about the name, John.

• 9:31John Coogan?

  Nemo-tron's a good name.

• 9:32Jordi Hays?

  Nemo-tron.

• 9:33John Coogan?

  Why?

• 9:33Jordi Hays?

  Very cool name. There are people are, you know, there's, there's some talks bubbling. People are saying it's, it's, it's one of the best names for, for a family of models ever.

• 9:43John Coogan?

  What comes after ultra? Isn't that what the, the, didn't Apple first do that with the, the M four Pro, the M four Max, the M four Ultra? So we got to come up with an even better word for what happens after ultra.

• 9:56Jordi Hays?

  Giga.

• 9:57John Coogan?

  Giga, maybe?

• 9:57Jordi Hays?

  Hyper.

• 9:58John Coogan?

  And then Exa, you just keep going down the, the Terra. All the terrorists like land, that's a different one. Um, anyway, the market's faith in Anthropic and OpenAI continuing to build more cable models that push the frontier, AI frontier has been at the heart of the boom, helping justify trillions of dollars in spending on infrastructure in the coming years. The threat that new players will vastly undercut what they can charge for advanced AI pushed down some tech and AI company stocks prices last week. David Sacks, the venture capitalist and White House AI advisor suggested that he read Ball's post as a confession to a regulatory capture strategy. Sacks and others have long seen calls for AI regulation by companies such as Anthropic as efforts to use new laws and policies to stymie competitors.

• 10:43John Coogan?

  The weaponization of regulatory uncertainty as a competitive tool should be completely unacceptable, he said. Security focused administration officials in the past year have considered a slew of measures to crack down on Chinese AI companies developing open models. But people familiar with the discussion said they have weighed on, uh, they've weighed adding the businesses to trade blacklists, security warnings on Chinese AI companies and a potential executive order targeting open models. So it does seem like, even though Tyler Cowen, we were going back and forth with him about this, about like, can you even ban it? You can't really ban anything in the land of the free, like the solution to piracy was not really to ban piracy.

• 11:22John Coogan?

  Like you can still torrent things, but it's just so easy to use Apple TV and Spotify and Netflix that most people just wind up just paying five dollars, two dollars for a song or, or $10 a month for something. That it effectively killed it just because the product experience was better.

• 11:40Jordi Hays?

  This morning, uh, our Treasury Secretary Besen was on Fox and said, this administration supports open source models, but what we do not support is IP theft. If we see, especially their overseas models are stealing from our great companies, we have the ability to sanction them because of this theft. So it will be, if the admin does take serious action here, uh, I would expect that to be the line of reasoning where they could just sanction

• 12:14John Coogan?

  Yeah.

• 12:15Jordi Hays?

  the companies behind these models, which I imagine would prevent, it would create a real opportunity for American open source. But, uh, you would, you would ultimately see, uh, a lot of these, you know, Neo clouds unable, I imagine to, uh, serve the, you know, traditional Chinese open source models. I imagine that even Open Router would probably have to

• 12:40John Coogan?

  Yeah, maybe.

• 12:41Jordi Hays?

  Uh, stop supporting that.

• 12:42John Coogan?

  But again, with an open source model, like, how do you even define it? Because if there's a research paper and then you go and implement that and you train it or you take it, you fine tune it, or you use the data to bootstrap your own model. Like, it just like, where, where in the supply chain, how many steps away do you need to be to like not count on there? You imagine, I mean, didn't perplexity do like a 1776 deep seek very quickly? They did a fine tune. I think you did a fine tune on deep seek as well. Wow.

• 13:12Speaker 02

  Yeah. Well, that was like using sparse auto encoders.

• 13:14John Coogan?

  Okay.

• 13:15Speaker 02

  I did it first, so.

• 13:15John Coogan?

  But, but, and, and what, what nationality was the model that you used as the base?

• 13:20Speaker 02

  Well, it was deep sea. It was China.

• 13:22John Coogan?

  Wow, confession. Uh, you can go now.

• 13:26Jordi Hays?

  Um, yeah, people are, are already angry at, at, at Besen's comments, uh, and are, and are saying funny that he's not mentioning, uh, that yesterday US judge approved Anthropic's one and a half billion dollar copyright lawsuit settlement.

• 13:42John Coogan?

  Huh.

• 13:43Jordi Hays?

  I don't think they, they, I think they settled that they were in possession of books that had been torrented or, or, um, basically acquired unlawfully.

• 13:53John Coogan?

  Yeah.

• 13:54Jordi Hays?

  I don't believe that.

• 13:55John Coogan?

  Acquired unlawfully, he said, they stole the book. I think they bought the books.

• 13:59Jordi Hays?

  No, no, no, no, no. I think this was, no, they, they separately, they bought a bunch of books, trained on them and destroyed.

• 14:05John Coogan?

  And that just made people upset because no one likes the idea of books being destroyed, of course.

• 14:10Jordi Hays?

  Um, I think those were rare, like rare, rare books.

• 14:13John Coogan?

  The Wilmanitis collection was destroyed. Rare PDFs.

• 14:18Jordi Hays?

  Uh, no, but I, but I believe so. Judge William Alsop of the US District Court for the Northern District of California issued a preliminary approval of the settlement last year after ruling that Anthropic had illegally downloaded and stored millions of copyrighted books. Um, and the settlement was signed off on by a different judge yesterday. Uh, the payout will deliver $3,000 per work across an estimated 500,000 works, shared among the authors and publishers who hold rights to them.

• 14:48John Coogan?

  Mm hmm. Um. I have more here, but first I'm going to tell you about Figma. Agents, meet the canvas. Your AI agents can now create and modify your Figma files with design system context. So, uh, Nick Carter, uh, who we love, former guest of the show, uh, he says, I haven't seen one person from OpenAI or Anthropic address John's argument here. Quote, "The point is simple. The US government does not owe either of the large labs a business model." I think that's accurate. That's true. The US government doesn't owe any company a business model. It's a free market. It's a free country. Uh, if the economics of selling tokens don't work due to distillation, cheap clones, Chinese AI magic, the American enterprise and consumer will be A okay. That is also true. The American consumer and enterprise will be okay.

• 15:32John Coogan?

  Uh, flooding the market, dumping all this stuff is, is great for consumers. It's great for enterprises. Cheaper products are great. The, the question is, is the US government actually does kind of owe the, the, like, the reason you pay taxes, that actually does pay for the FBI who go and find spies. And so if the allegation, which has been sort of toyed around with some of the lab leaders at some conferences, like off the record, and then it's like made it to the record, I don't exactly know where the allegations stand at this point. But if the allegation is, look, there's a spy here who's stealing code and exporting it to another country.

• 16:14John Coogan?

  Or even the distillation, which is in violation of terms of service and you, and it's a geopolitical debate because it's an international company. It's so, like, that's the reason why you pay taxes to pay the government to actually help fight on your behalf. Because you, if it's, if it's, if it's, uh, OpenAI stealing from Anthropic or vice versa, they'll just walk across the street and serve them papers and be like, we're suing each other. This is what happened with Apple and, and OpenAI. Like, they're going to solve that in the court of law, which is of course paid for by the US taxpayers as well. That judge who oversees that and decides that case will be paid for by US taxpayers. That is an amenity of the US government. And a similar amenity is when you, when someone is violating your terms of service or actively stealing from you,

• 16:58John Coogan?

  uh, you actually can engage the US government. So I, I agree that the US government doesn't owe anyone a business model, but the US government does sort of owe the ability to chase down something if it is truly illegal. And there's no other recourse like just, hey, we're turning off your account because you're not, uh, you're not abiding by, uh, terms of service. Um, but the rest of the point is, is good and the knock on effects are, are good. He, he understands the, the, the value to the American consumer of, of cheap goods. He understands the value to the Neo clouds and, and other token factories. All of this is fine. Um, but I just thought that that was, that, that, that there is a line there that some people on the inside have been stronger about.

• 17:42John Coogan?

  There's been a lot of debate on like, is this distilled? Is it going to say it's Claude or ChatGPT? And, you know, it goes back and forth. There's a bunch of examples. It's always hard to chase down. But that's why we have like a real process to hunt that down. Uh, anyway, there was some news about like whether or not, uh, Kimi K three is distilled. Tyler, can you take us through this Lisan Algaib post? Because I want to know what this chart means because it seems important to this discussion.

• 18:10Speaker 02

  Yeah. So he, he didn't actually make this chart. It was from someone else. But basically this shows a bunch of models compared to another, and it's like the kind of, uh, semantic similarities between them.

• 18:18John Coogan?

  Okay.

• 18:19Speaker 02

  So it's like, if you use similar kind of diction or phrases, stuff like this, um, you just like prompt the model a bunch of times and you kind of can tell what's similar to each other.

• 18:28John Coogan?

  Yes.

• 18:28Speaker 02

  And you can see, uh, in this version, it looks like, like Kimi K three is, is very similar to Fable five.

• 18:34John Coogan?

  Fable five, and then also Opus four point seven, Opus four point eight and Sonnet five. So they might've gotten tokens from like all four of those models sort of mixed them together.

• 18:42Speaker 02

  Also, I think this exact example, like, I, I think only like a few prompts were used. It's not like super involved. Um, it's also like, this is very much just like correlation. This is not like proven that they distill or anything. They could have just used like similar, you know, post-training techniques or something like this.

• 18:57John Coogan?

  Totally. But notably, uh, GPT five point four, five point five, five point six share very little similarity to the Anthropic models and vice versa. The Anthropic models don't seem to be correlated with the OpenAI models, although the OpenAI models are correlated with them, with, with each other. So, uh, five point six Luna looks pretty correlated with five point four because they probably were like, well, we're building on the shoulders of the work that we've been done. And, and it's the same thing with Anthropic where Fable has some of the same flavor as an Opus or a Haiku. And that makes sense.

• 19:35Speaker 02

  That makes sense because people have like been saying, oh, maybe those models were actually distilled from the, the big like Mythos pre-train, right?

• 19:42John Coogan?

  Yeah, or, or vice versa. Or vice versa, you have a bunch of users that are doing rollouts on Opus, trying to vibe code different things. And you take all that training data and then you feed that into Fable and Fable sort of like picks up on a lot of that because that's what the, like, the, the user said, wow, you really did a great job on this Opus and, or you did really poorly. It pulls that out, but it's still learning the, the textual similarity. Well, people will, uh, go back and forth on this and, uh, and debate the level of distillation and also what the punishment for distillation should be. Should it just be a slap on the wrist or should it be something bigger? Um, it's obviously.

• 20:22Jordi Hays?

  Yeah. So Bill Gurley's, uh, chiming in on, on Besen's comments. He says, if there has been theft, that suggests a crime has been committed, but I'm unaware of any lawsuits being filed. No company should be allowed to declare infringement without education. I'm not convinced a course, a court would call using a product as it's designed. Theft. There is a reason this is being lobbied in DC instead of the normal court systems. The only thing I would say here is like distillation against against the terms of service.

• 20:52John Coogan?

  Yeah.

• 20:53Jordi Hays?

  And I think that suing Chinese companies.

• 20:57John Coogan?

  Yeah.

• 20:57Jordi Hays?

  It would be a complete and total waste of time. Ask anyone who's built a product that's been knocked.

• 21:03John Coogan?

  I disagree. Incredible aura farm. If you if you personally serve Xi Jinping, the next time he's in San Francisco, meeting with a, you know, a world leader, you show up.

• 21:19Jordi Hays?

  You have been served.

• 21:20John Coogan?

  You show up to the UN, serve the world leader. There's something about that that's, you know, extremely bold. But I know, I agree with you. Very difficult. I don't even know if you went to your law firm and you said like, hey, we want to sue this Chinese company, like how they would trace that down. Also, deeply ironic and deeply unsympathetic suit, right? Because the the general populace feels like AI is all theft and it's all been stolen from the the public commons or the public internet. It's like distilled on the internet. We all did all these. We all made all these websites and now they all have been distilled into this, into these like frontier models. And then you're saying, oh, well, like the

• 22:01John Coogan?

  the distillation stops at the frontier lab. So not going to have a lot of sympathetic jurors.

• 22:06Jordi Hays?

  So someone responded to Bill's post with a with a similar point to the one I made and said, the reason there hasn't been any lawsuits is that a trial would take years, assuming you can get a Chinese company to participate in the game will be over by then. China steals IP. This is obvious. You don't find many, any instances of US companies suing Chinese companies in US courts. Bill Gurley fires back with a screenshot from chat GPT saying, here are 10 clear examples. The first, the first five were filed in US courts.

• 22:41John Coogan?

  Okay.

• 22:42Jordi Hays?

  You have Motorola Solutions.

• 22:43John Coogan?

  Okay.

• 22:44Jordi Hays?

  Was a US plaintiff for the Chinese defendant of Heitera Communications. This was Chicago Federal Court in 2017.

• 22:52John Coogan?

  Yeah.

• 22:52Jordi Hays?

  T-Mobile came after Huawei, Federal Court in Seattle, 2014.

• 22:57John Coogan?

  Throwing down the gauntlet.

• 22:58Jordi Hays?

  Huawei employees copied and took parts of from Tappy, its phone testing robot.

• 23:03John Coogan?

  Sure.

• 23:03Jordi Hays?

  Cisco sued Huawei. Let's give it up for Cisco.

• 23:07John Coogan?

  Let me actually, let me actually tell you about Cisco.

• 23:09Jordi Hays?

  Cisco accused Huawei of copying.

• 23:10John Coogan?

  Cisco is critical infrastructure for the AI era. Unlock seamless, real time experience of new value at Cisco. Continue.

• 23:16Jordi Hays?

  Cisco accused Huawei of copying router source code, command line interfaces, manuals, and patented networking technology.

• 23:23John Coogan?

  That's what I'm talking about.

• 23:23Jordi Hays?

  Textron Innovations.

• 23:26John Coogan?

  Correct use of the US government.

• 23:28Jordi Hays?

  Sued DJI in Federal Court in Waco, Texas, home to a fantastic wave pool. Textron alleged alleged DJI drones and fringe patents covering flight control and tracking technology. And there's a bunch of other examples.

• 23:43John Coogan?

  Yeah.

• 23:43Jordi Hays?

  ASMC, AMSC, the American Superconductor Company.

• 23:51John Coogan?

  He's one shot by Chinese versus American.

• 23:53Jordi Hays?

  Sued Sinovel Wind Group.

• 23:54John Coogan?

  Okay.

• 23:56Jordi Hays?

  Anyways.

• 23:57John Coogan?

  You want to give us?

• 23:57Jordi Hays?

  Lots going on here.

• 24:00John Coogan?

  Two of our former guests are chirping at each other on the timeline. We talked to Jim Cramer at the New York Stock Exchange. Want to change the world? Raise capital at the New York Stock Exchange. We interviewed Jim Cramer at the New York Stock Exchange. Great time. He's going back and forth with George Hots, another former guest of the show. Jim Cramer says, we must not let our companies use these Chinese models to save a few bucks. OpenAI and Anthropic are correct. This is vital national security. Please, please read Bing West's just released Catch Five. I respect the Chinese people greatly, but these companies are run by the PLA, for heaven's sakes. George Hots fires back under the tiny grad handle.

• 24:42John Coogan?

  He says, is this a joke? I'd be happy to use Anthropic if they put their weights on hugging face like the Chinese. American tech companies are rent extraction machines that have lost the plot. No point continuing to defend them. They need to change if they want to win people back. 474 likes on that. The open source community is coming out strong. Anyway.

• 25:03Jordi Hays?

  Meanwhile.

• 25:04John Coogan?

  Yeah.

• 25:04Jordi Hays?

  China is also thinking about export controls.

• 25:07John Coogan?

  Ooh.

• 25:07Jordi Hays?

  In the Financial Times.

• 25:09John Coogan?

  Okay.

• 25:09Jordi Hays?

  Apparently Alibaba, ByteDance, and Zepu.

• 25:13John Coogan?

  Going back and forth.

• 25:14Jordi Hays?

  On lim, M, what ministry, is this the Ministry of Communications?

• 25:22John Coogan?

  Don't know.

• 25:23Jordi Hays?

  M O, M of com. Help me out there, Tyler.

• 25:28John Coogan?

  MoFcom.

• 25:28Jordi Hays?

  MoFcom. Talk to AI companies, including Alibaba, ByteDance, and Zepu on limiting the transfer of key data for the training of their models overseas, as well as allowing their model weights to be downloaded.

• 25:39John Coogan?

  Ministry of Commerce. Probably their Department of Commerce.

• 25:42Jordi Hays?

  That seems more like it. China would still let overseas customers access the models and services, but it sounds like they're leaning towards not making the weights open. We're going to, we're going to see with the new Kimi K3 if they actually release the weights.

• 25:57John Coogan?

  Yeah.

• 25:58Jordi Hays?

  Next week. Dean Ball says, wow, two days in a row where things I said are likely to happen seem likelier to happen from two adversarial countries, almost as though my analysis was right and as though people should not have deliberately misinterpreted, misinterpreted me as of making prescriptions. Huh?

• 26:16John Coogan?

  Dean Ball victory lap. You gotta take a victory lap for Dean Ball. He called it. No, he, I mean, he was saying like, I don't necessarily agree with this, but just from his experience, this is how things might play out. And people were there with him about that.

• 26:30Jordi Hays?

  Raj in the chat says Ministry of Commerce, People's Republic of China.

• 26:35John Coogan?

  It's their Department of Commerce.

• 26:36Jordi Hays?

  That would go hard on a business card.

• 26:39John Coogan?

  It would. Anyway, if you're trying to make a new business card, fire up Codex, design it there, have it printed, have have Codex do everything for you. Fantastic at creating custom things and then running them off to special printers. Codex, of course, is a powerful workspace for getting work done with AI agents. Whether you're writing code, analyzing data, creating content, or automating business workflows, Codex helps you move projects forward from start to finish.

• 27:03Jordi Hays?

  The great slop wars.

• 27:04John Coogan?

  Slop wars continue.

• 27:06Jordi Hays?

  Let's pull up this video from Substack.

• 27:09John Coogan?

  Substack. We got Chris Best coming on at 12:15. It's just an image.

• 27:13Jordi Hays?

  They say today Substack is launching an AI detection feature via an integration with Pangram. Going forward, you'll be able to scan posts, replies, and comments on the Substack app to see an estimate of how much of it was written by a human or with AI assistance. We care about this at Substack because it gets to the core of our mission to build an economic engine for culture.

• 27:33John Coogan?

  This is going to be bad for Tyler, since he's mastered the ability to write exactly like an AI. What was that sentence, sentence you wrote by hand that was like, according to studies, you're absolutely right. And you just threw in every possible AI-ism and and got flagged 100% by Pangram. No, I think people will enjoy this. The the revealed preference is probably that people don't care if it's good and they enjoy the the content. But we'll, we'll, we'll go back and forth and debate it with Chris Best today and see where all of that is going. He wrote a post against Claude fishing. He doesn't

• 28:14John Coogan?

  want people to be disingenuous about their process. Now, do you think that Substack writers should admit when they hire essentially ghostwriters?

• 28:27Jordi Hays?

  Uh, probably.

• 28:30John Coogan?

  Because sometimes you start a brand under a name, like not every post on Bloomberg.com is from Michael Bloomberg. In fact, none of them are. They're all from other people, but they disclose this is from, you know, some writer. This is from Joe Weizenbaum, right? But some new influencer brands have grown, even in the pre-AI era. I had a writer on my team when I was doing YouTube videos where I would write something, he would do a draft, we'd try to go back and forth. I'd put him in the credits, but I wouldn't like kick it off with like, hey, just so you know.

• 29:10Jordi Hays?

  Andrew in the chat says, book authors don't. That is certainly true.

• 29:13John Coogan?

  That's 100% true. Some book authors will put like, this is written by this person and this person. It depends on like the aura of the ghostwriter. Some ghostwriters actually do get credits in the book, but yes, most book authors, like Tom Clancy, I think passed away and they're still producing books. There's a number of writers where their their individual brand grew so big that they can, you can have like a new Tom.

• 29:35Jordi Hays?

  They become a business.

• 29:36John Coogan?

  Yeah, they become their own brand and so.

• 29:37Jordi Hays?

  Yeah, I would, I would imagine that. Thirty percent of the books in like an airport bookstore are just a hundred percent ghostwritten and probably

• 29:46John Coogan?

  Yeah.

• 29:47Jordi Hays?

  Don't disclose it.

• 29:48John Coogan?

  I think, I, I, I do think it should be, it should be possible to get to the, the, the truth if you hunt hard enough, but I don't necessarily need you to put it front and center. So, let's say that the next Tom Clancy book, they hire someone who's effectively a prompt engineer and they're writing it using AI. I would like to be able to, you know, look in the back of the book and see a paragraph that discloses that, but it doesn't need to be on the cover. On the cover, it can just say Tom Clancy.

• 30:21Jordi Hays?

  Yeah, for a sub, for a Substack author

• 30:23John Coogan?

  Yeah.

• 30:24Jordi Hays?

  Or creator, just put it somewhere

• 30:27John Coogan?

  Yeah.

• 30:28Jordi Hays?

  That you have a team of people that help you create

• 30:31John Coogan?

  Yeah.

• 30:31Jordi Hays?

  Your work.

• 30:32John Coogan?

  Well, Dave Eggers took to the Financial Times saying that no one is gonna read AI books. He's of course the author of The Circle. He's an American writer, editor, publisher. A heartbreaking work of staggering genius is his 2000 memoir, bestseller, final for, finalist for the Pulitzer Prize. He says, "Gullible and ridiculous. No one will read AI novels." I think people are already reading AI novels, so he, maybe he means like, no one who's cool, or no one who he likes or something. Let's read through a little bit of this Financial Times article. "Dave Eggers offers a hand so I can clamor aboard his 23-foot sailboat, moored in the

• 31:14John Coogan?

  shadow of San Francisco's Golden Gate Bridge. It's a grand setting with few frills as we sit on the stern a meter apart, fuel cans and fishing nets at our feet. There is no one around to disturb our conversation. The nearest toilets are portaloos, a short bike ride away, the birthing fees are negligible, making it one of the cheapest places to live in uber wealthy Silicon Valley. I hadn't thought of that. Sailboat? If you're at a tech company? This has gotta be the next big lock-in trend."

• 31:43Jordi Hays?

  Antonio Garcia Martinez did this.

• 31:44John Coogan?

  He did.

• 31:45Jordi Hays?

  Talked about in his book, Chaos Monkeys.

• 31:46John Coogan?

  But I'm not, I won't be satisfied until I see LARPers posting images on Twitter being like, "Hey, I just moved to San Francisco. I'm building the next one-person, $25 billion"

• 31:57Jordi Hays?

  I'm finding a houseboat in San Rafael.

• 32:00John Coogan?

  Yeah? How much?

• 32:01Jordi Hays?

  For 1,000, uh, it, it actually works out to $1,483 a month apparently if you finance it through Boat Trader.

• 32:11John Coogan?

  Goodbye Tyler.

• 32:12Jordi Hays?

  It's only about $200,000 to live in a 2022 houseboat.

• 32:15John Coogan?

  2022? That's a brand-new houseboat.

• 32:18Jordi Hays?

  Yes, you have to think about the, yeah, the slip fees, but you could easily come in

• 32:22John Coogan?

  Yeah.

• 32:23Jordi Hays?

  Have your own house on the water.

• 32:24John Coogan?

  No, the average, the average one-bedroom rent in San Francisco is like two grand, three grand right now.

• 32:29Jordi Hays?

  Yeah, you could have a whole house and a boat.

• 32:31John Coogan?

  And a boat. It's amazing. This is the hack. If you get a job in tech and you're printing, making six figures.

• 32:38Jordi Hays?

  Wow.

• 32:39John Coogan?

  Move into a houseboat.

• 32:40Jordi Hays?

  Let's pull this up.

• 32:42John Coogan?

  Is this an option in LA? Should members of the team be doing this? Should we, should we recommend this to?

• 32:47Jordi Hays?

  Look at this brand, almost brand-new.

• 32:50John Coogan?

  I feel like Jackson.

• 32:51Jordi Hays?

  2024 Le Mer Modern 11. It's a 36-foot houseboat. We have a video here.

• 32:56John Coogan?

  Well, Dave Eggers says, "They call it a $10 dock with a million-dollar view."

• 33:02Jordi Hays?

  Look at this, John. This?

• 33:04John Coogan?

  Yeah.

• 33:04Jordi Hays?

  Couple thousand bucks a month.

• 33:06John Coogan?

  This is where the next great startup will be born.

• 33:09Jordi Hays?

  Yeah.

• 33:09John Coogan?

  For sure.

• 33:10Jordi Hays?

  Garages are out.

• 33:10John Coogan?

  Garages are completely out. And also like, oh, take your shoes off. It's no, it's natural to take your shoes off when you're on a boat, you know? Right? Unless you've got boat shoes. Wear boat shoes to the boat.

• 33:20Jordi Hays?

  The Le Mer Modern 11 offers reliable performance and strong power with two Yamaha 25 high-thrust engines, providing a total of 50 horsepower. Its two cabins and one head ensure overnight comfort for extended stays. How about year-long stays? How about a decade-long stay? The boat's design includes an upper-deck terrace with flexed teak flooring, enhancing its appeal for relaxation and entertainment, and might I say, locking in. Standard features such as air conditioning, we have air conditioning on our houseboats.

• 33:50John Coogan?

  Mm-hmm.

• 33:51Jordi Hays?

  Uh, with reverse-cycle heat, heated floors, LED lighting.

• 33:55John Coogan?

  Heated floors!

• 33:55Jordi Hays?

  LED lighting.

• 33:57John Coogan?

  Yeah.

• 33:58Jordi Hays?

  The inclusion of foam-filled composite floats and galvanized steel subframe ensures durability and stability.

• 34:04John Coogan?

  Did we just solve the housing crisis? Send this to Sagar and Jett immediately. This is seasteading. This is the TL thesis. Everyone living in houseboats, just more

• 34:14Jordi Hays?

  BoatTrader.com is saying that this

• 34:17John Coogan?

  This is amazing.

• 34:18Jordi Hays?

  Modern houseboat would come out to just $2,259 with only $52,000 down. I promise that we have no financial relationship with BoatTrader.com.

• 34:30John Coogan?

  Yeah.

• 34:31Jordi Hays?

  Even though I'm making a pretty strong pitch here.

• 34:33John Coogan?

  Yeah. I love it.

• 34:36Jordi Hays?

  Uh, I'm tempted. Maybe we should, I mean, you can, I'm finding another at 2021.

• 34:41John Coogan?

  Okay.

• 34:41Jordi Hays?

  For only 99 thou-

• 34:43John Coogan?

  Dive now.

• 34:44Jordi Hays?

  Only, yeah, only $100,000. This comes out to $738 a month.

• 34:51John Coogan?

  That is cheap. That is cheap.

• 34:52Jordi Hays?

  They're giving houseboats away, John.

• 34:54John Coogan?

  When I moved to San Francisco, we lived in the Tenderloin, three people, and it was 1,500 a month. How many people do you think you could sleep in there? Given that one of us slept in a closet and the other one slept in the living room. So there was only, it was a one-bedroom technically. We had three, three dudes in a one-bedroom, 1,500 a month.

• 35:11Jordi Hays?

  Only three?

• 35:12John Coogan?

  So it's equivalent to $500 a month. Do you think you could fit two people in there? In a $700 a month houseboat?

• 35:17Jordi Hays?

  Oh, for sure. Yeah, so we're finding slip, the, the team is finding slip fees around LA for 700 bucks a month. You get a-

• 35:25John Coogan?

  Everyone's gotta be houseboat bags. Imagine just bombing with your whole crew.

• 35:30Jordi Hays?

  You can get this houseboat for only $600 a month.

• 35:31John Coogan?

  This is, this is elite. This is the future. We must, we must return to the ocean, return to the sea. Uh, anyway, Dave Eggers thinks no one's gonna read AI books. We can move on. TLDR. We got distracted, sorry. But congratulations on the sick houseboat. It sounds amazing. The, the article's actually funny. It goes into a whole thing how he, uh, he was like chirping with Sam Altman, goes to-

• 35:55Jordi Hays?

  Halley says, "Welcome to the houseboat. The business of buoyancy."

• 35:58John Coogan?

  The president of propellers. I love it.

• 36:00Jordi Hays?

  That's right.

• 36:01John Coogan?

  The presidency of propellers. Um, should you recline your airplane seat? What do you think? People are going back and forth on this.

• 36:10Jordi Hays?

  Brandon Ducks says, "I don't remember subscribing to this channel, but I've been listening for 10 minutes. I'm having a good time."

• 36:15John Coogan?

  Welcome.

• 36:17Jordi Hays?

  Last name Ducks comes on just for the half-

• 36:20John Coogan?

  Yeah, make it make sense. Make it make sense. He's just like, "I just happen to be here for the duck section of the, of the show."

• 36:27Jordi Hays?

  Andrew says, "I'm gonna need a double-wide houseboat, lol. Bootlegging distilled anthropic models on the houseboat."

• 36:33John Coogan?

  There we go.

• 36:36Jordi Hays?

  Living the dream.

• 36:37John Coogan?

  This is crazy.

• 36:38Jordi Hays?

  Oh.

• 36:39John Coogan?

  Okay, so should you reply, should you recline your airplane seat? Uh, there's a central, investigating the central dilemma of our time. Joshua Rothman in The New Yorker wrote a, a piece. Imagine this scenario. After a long drive to the airport, you've just taken off for a 15-hour flight. Where are you going? 15 hours is so long. How long was the flight to Austria from LA?

• 37:01Jordi Hays?

  I think it's like 12 hours. So I think you're going to the Middle East.

• 37:04John Coogan?

  You're going to the Middle East, maybe. Okay. Uh, you're in coach and a family of three is sitting behind you, a man, a woman, and a toddler. They seem nice, but as the flight continues, the kiddo grows restless. He kicks your seat and pokes her toys into your shoulder. "Stop that," you hear the father say. The toddler incredibly quiets down. The cabin lights dim. It's time to sleep. Yet, just as rest closes in, you sense motion. The seat in front of you is reclining. You watch as it comes all the way back. Now you feel cramped with someone else's seat in your face. You also notice some stiffness in your shoulders. Your fingers caress your own recline button. Surely, the reclined upon are entitled to recline. Just as you start to lean back, you hear a clearing throat. You turn around to see the dad who fixes you with his gaze. "Excuse me," he says, "would

• 37:49John Coogan?

  you mind keeping your seat up?" I think it's game on. They put the button there. They would just take it away.

• 37:53Jordi Hays?

  Yeah, I think, I think, I've always expected everyone to just recline.

• 37:57John Coogan?

  Everyone reclines. Everyone has the same amount of space. It's the conservation of space and the whole pitch-

• 38:03Jordi Hays?

  It's really hard to make the argument that the, the vertical seat is more comfortable than the reclined seat.

• 38:07John Coogan?

  Exactly.

• 38:08Jordi Hays?

  So I think everyone commit to comfort.

• 38:10John Coogan?

  Everyone commits to comfort.

• 38:11Jordi Hays?

  And then the chat is sharing the real alpha. Stand up immediately when the flight lands.

• 38:16John Coogan?

  Have you seen those Meta Ray-Ban videos where people sprint to the front? It's so rude. The guy is like, like, you know, he's like, as soon as he goes beep, he just bolts and passes everybody and gets to the front. Very rude. I don't think you should do that.

• 38:30Jordi Hays?

  This is antisocial behavior. I don't think you should recline your seat.

• 38:32John Coogan?

  How is it antisocial?

• 38:34Jordi Hays?

  Because you're infringing on someone. Just because you can do it doesn't mean you should.

• 38:38John Coogan?

  But they put the button there.

• 38:39Jordi Hays?

  Horrible take.

• 38:40John Coogan?

  They're, they're-

• 38:41Jordi Hays?

  Horrible take.

• 38:42John Coogan?

  That, that, that's like, don't use the bathroom on the, on the plane. They put the bathroom there. Don't use the bathroom.

• 38:47Jordi Hays?

  My entire life, even as a child, I was looking up, waiting for, for, you know, the, the seatbelt sign to, you know, to be up in the air. Seatbelt signs off, you recline your seat. Everyone reclines.

• 38:58John Coogan?

  Everyone reclines.

• 38:59Jordi Hays?

  Seats, all good.

• 38:59John Coogan?

  Yeah. Uh, what, what about, what about ordering a Diet Coke on a plane? If I'm sitting next to you, will you order a Diet Coke or is that antisocial behavior? Because there's a percentage chance that you will spill that Diet Coke on me, thereby inconveniencing me. The most pros, if you really care about me, you should not order anything. You shouldn't eat anything. You shouldn't drink anything. You should sit there in your unreclined seat, perfectly upright, silent, don't make a-

• 39:26Jordi Hays?

  That's completely different.

• 39:27John Coogan?

  Okay. What's your stance on JBL in the airplane?

• 39:31Jordi Hays?

  Little petty walk.

• 39:32Speaker 02

  Pro JB Elf, you know.

• 39:33John Coogan?

  I, I, I do think, I do think that could be the next, the next trend.

• 39:37Jordi Hays?

  The big question is, are you bringing on your, you know, smart, portable, you know, speaker? Maybe from a, from a, from an OpenAI. Are you bringing that on the plane and talking to it the whole time? You know, is that offensive?

• 39:53John Coogan?

  That's deeply offensive.

• 39:54Speaker 02

  Have you seen when like a, a band is traveling?

• 39:56John Coogan?

  Yeah.

• 39:56Speaker 02

  And they start playing on the plane?

• 39:58John Coogan?

  No.

• 39:58Speaker 02

  Have you seen these videos?

• 39:59John Coogan?

  No, I haven't. That sounds cool though.

• 40:00Speaker 02

  I'll send you one.

• 40:01John Coogan?

  I'd be down.

• 40:02Jordi Hays?

  That would make me jump.

• 40:03John Coogan?

  So this all started because, uh, in 2014, 538, we gotta have him on the show. Uh, Nate, obviously, uh, 538 asked around a thousand flyers what they thought about reclining their seats. Forty-one percent of them said that reclining was rude. So they lost. It's not rude.

• 40:21Jordi Hays?

  It's over.

• 40:23John Coogan?

  Uh, 59% said it's fine. I guess if it was just binary. Uh, that number seems to have risen though. In 2020, Eric Jones, a math professor who writes about travel statistics on the website, The Vacationer, conducted a similar survey and found that 77% of respondents objected to reclining. Wow. Sheep, sheeple over here. We got sheeple in the building.

• 40:43Speaker 02

  I think you should be able to recline if you're like dressed nicely. If you're wearing sweatpants, then you don't get to.

• 40:48John Coogan?

  You don't get to recline. Sort of a conditional recline.

• 40:51Speaker 02

  Yeah, yeah.

• 40:52Jordi Hays?

  Should kids be able to kick the front, the seat in front of them as much as they want?

• 40:56John Coogan?

  See, that's something I will pull, I will totally put up with. I'm totally fine getting kicked in the back by a kid. Because it's so brutal as a parent, as a kid to be on a plane. They're locked up in the plane. That's miserable. And just, just tough it up. You're, you're reclined. You have multiple inches of padding. Unless you got Ronaldo back there, you're gonna be fine.

• 41:17Jordi Hays?

  Order that hot pizza pocket. Live life in the permanent underclass. Live a little, for God's sake.

• 41:23John Coogan?

  Yeah.

• 41:23Jordi Hays?

  Uh, let's pull up this video and.

• 41:25John Coogan?

  What video we got now?

• 41:28Jordi Hays?

  All right.

• 41:29John Coogan?

  Oh, this is so good. I love this. Like, this is so antisocial behavior. This is so breaking the social contract, but it's also just such an elite performance that you gotta respect it a little bit. This is a cra- that getting around that woman is crazy, crazy, crazy work. I can't believe this. I might, I, if I'm really in a hurry, I might go one seat forward, like sword, if I'm on the aisle, I might sort of like make sure I get the first position, pole position. I think that's fair.

• 42:04Jordi Hays?

  Chat wants to know, if, if, if the plane is in free fall,

• 42:09Jordi Hays?

  would you recline a little on the way down? Engine, engine failure. I think, yeah, that's fine. I think that's fine. Okay. Okay. So you would, you would be rude to your neighbors in that, in, in, in this sort of stressful, you know, potentially, uh, terrible, life-threatening moment? You wouldn't mind being rude to your neighbors?

• 42:30John Coogan?

  In my final moments, that's when you would choose to disrespect me, Tyler? Not when I'm living life, having a Diet Coke, enjoying myself. You're fine then. But when it, when I'm at my last breath, that's when you decide to add insult to future injury.

• 42:44Jordi Hays?

  Yeah.

• 42:45John Coogan?

  Weird.

• 42:45Jordi Hays?

  Wow.

• 42:46John Coogan?

  I don't, I don't get it. Make it make sense.

• 42:48Jordi Hays?

  Wow.

• 42:48John Coogan?

  Make it make sense. Uh, Coca-Cola rebrand. We gotta talk about the Coca-Cola rebrand. There's a bunch of things. Oh, there's so much good news today. Uh, Coca-Cola rebranded, and, uh, there's a video of this, and people are saying it looks like a tobacco brand. I want your brand review. Uh, Coca-Cola unveiled a new global brand identity. Uh, it's not technically the Marlboro font.

• 43:12Jordi Hays?

  Flight's crashing in five minutes. Can you recline your seat back, please?

• 43:21John Coogan?

  Ridiculous. Pull up the video of the Coca-Cola rebrand. I want Jordy's brand review. There we go. The most recognized brand. This is huge for me.

• 43:46Jordi Hays?

  Wow, they did it.

• 43:47John Coogan?

  They did it.

• 43:48Jordi Hays?

  They finally did it.

• 43:51John Coogan?

  Serifs, border radius zero, sharp edges, full bleed. It's right to the edges. And people were expecting it to look extremely boring, sans serif, sort of an Apple ripoff. We can pull up this post from Fabrizio Rinaldi about what he was expecting to show sort of where things have been going in rebrands, high fashion. Uh, let's pull up Fabrizio's, uh, rendition of the Coca-Cola rebrand. Wasn't this something that you would expect? But instead, we got something much.

• 44:26Jordi Hays?

  Minimalism is out. It's been out for a while. Maximalism started ripping early last year off a small base, but it's coming back.

• 44:35John Coogan?

  It does sort of look like Marlboro. People say it's not technically the Marlboro font. Uh, it's not the Marlboro font. It looks a little bit different, but.

• 44:44Jordi Hays?

  But it's pretty close.

• 44:45John Coogan?

  But also, I mean, incredible alpha in the fact that Marlboro effectively hasn't been able to advertise in 30 years. Like, it's a storied brand. They clearly put an incredible amount of effort into developing the brand, but it's vague enough that even a big brand like Coca-Cola can sort of rip it off and be in the clear. Like, besides a few, oh, yeah, yeah, the, the.

• 45:06Jordi Hays?

  Tyler says fridge, cigs for the win.

• 45:08John Coogan?

  They're leaning into the fridge cigarette.

• 45:09Jordi Hays?

  Yeah, saying they're leaning into the, the fridge cigarette concept.

• 45:13John Coogan?

  Yes.

• 45:14Jordi Hays?

  Very smart.

• 45:15John Coogan?

  Okay. Other, other movie news. Point Break. Have you seen it? No. But you will be able to see it because it's being restored in 4K and it's being re-released in theaters this summer for its 35th anniversary. Highly recommend it. Keanu Reeves, fantastic movie. Patrick Swayze, it's such a good movie. About a bunch of bank robbers who are also extreme athletes. It's super sick. You'd love it. Uh, maybe that's the next movie you see. Uh, maybe we can make it happen even this year. Uh, there's another story about Resto Mods from the factory.

• 45:46Jordi Hays?

  Here we go.

• 45:46John Coogan?

  Companies are going back and offering the actual manufacturer. Do you want to just describe for everyone, what is a Resto Mod? And then what are the critiques of it? Like, take me through, uh, the TJ Parker critique of the Resto Mod. We've talked to him about it. What is, when someone says Resto Mod, what are we talking about here?

• 46:04Jordi Hays?

  Uh, okay. So Resto Mods can look like a lot of things. There's like a range, but uh, at the most basic level, you're taking a classic car and you're trying to, uh, not necessarily make it feel like it is a product that was made in the year 2026.

• 46:25John Coogan?

  Yep.

• 46:25Jordi Hays?

  But you're trying to make it at least feel, sometimes they do that, but you're trying to make it at least feel like it's, you know, fresh off of the dealer lot.

• 46:33John Coogan?

  So I'm restoring it, but I'm also modifying it a little, a little bit.

• 46:37Jordi Hays?

  Uh, yeah. Well, there's range. So there's some, there's some Resto Mods that are just, they're restoring it to, to a new condition, even though it's an older vehicle.

• 46:48John Coogan?

  And when you say you are restoring it, typically this is individuals who want this car. They go to another company that is not the maker of that car. And then they say, I would like to purchase, uh, a Porsche 911 Resto Mod, and it's from 2003, but it drives, everything's been restored. There's been some modifications. Maybe it has CarPlay, heated seats. Maybe they've, they've updated little things here and there. tweaked the exhaust. So it's not original. It's not fully just purely restored. But what's happening now? Because that's been an independent business, sort of unauthorized. What's happening now?

• 47:24Jordi Hays?

  Yeah, there's a, there's a huge, there's a huge spectrum to it. So, so some might just be making the interior a lot nicer.

• 47:31John Coogan?

  Yep.

• 47:31Jordi Hays?

  Uh, up, you know, basically restoring the engine, uh, updating the, the transmission, things like that, all the way through like adding features and functionality like CarPlay, all the way through sometimes like redesigning the entire interior.

• 47:44John Coogan?

  Yeah.

• 47:45Jordi Hays?

  To make it almost a new car. So there's some Resto Mod companies that will just partner with the best automotive designers in the world to just almost fully redesign the car. And they're basically just keeping like, they're keeping, uh, keeping, everything is being turned over to some degree, except the fact that, uh, from a regulatory standpoint, it's still the original car, right? And so that helps you, uh, that helps to make it easier for Resto Mod company to like make a new car because they're, they don't have to go through all the.

• 48:16John Coogan?

  That's what, that's what Tyler has. Uh, he has a 2014 Jeep Grand Cherokee Resto Mod. It is beautiful. It, it's amazing. Everything about that car is fantastic. That's why it's so popular. It's, it's taste. It's, it's aura.

• 48:29Jordi Hays?

  So Singer, Singer is, you know, one of the most prominent companies in this, uh, category, but they become so popular that, uh, manufacturers are saying, hey, we want in on the action.

• 48:41John Coogan?

  Who wants in on the action?

• 48:42Jordi Hays?

  And so, uh, the newest player, Range Rover.

• 48:45John Coogan?

  Range Rover.

• 48:46Jordi Hays?

  Let's pull up this video if we can.

• 48:48John Coogan?

  And classic Range Rovers are having a huge moment. There was a piece in the journal about it. Look at this.

• 48:56John Coogan?

  And people have been clamoring for the analog feel. People have gotten sick of the endless buttons. And this is a way to go back to a 1993 Range Rover Classic, but have it drive as reliably as a brand new car.

• 49:13Jordi Hays?

  I'm super excited about this. My number one pet peeve with Resto Mods historically is they take this beautiful classic car and then they fix it up and then they put their logo on it.

• 49:25John Coogan?

  Oh, yeah.

• 49:26Jordi Hays?

  And, and I like, like, I saw, I saw a vintage Bronco that had, that just, like, somebody applied this sort of logo to it in the end that just said vintage. It's like, I don't need you to tell me that this vintage car is vintage.

• 49:46John Coogan?

  Yeah.

• 49:47Jordi Hays?

  Right? You could just make it look like the original version of it. So anyways, I'm super excited for more, more manufacturers to get into this space.

• 49:55John Coogan?

  Yeah.

• 49:56Jordi Hays?

  The category is growing quickly, so I think even the, you know, many of the Resto Mod players will, will still do quite well.

• 50:03John Coogan?

  And this seems super bullish for Range Rover as a company. Like, they say, check with your local retailer or Land Rover Classic. You imagine that a lot of people will be drawn into showrooms for this. Will they leave with, with a 1993 Range Rover Classic that's been restored from the factory? Or will they buy something new because they're like, yeah, maybe I want that, but that'll be my weekender and I just need something for the family. So I'll just buy something more modern or new. Like, it, it's just another, it's almost like a Halo car. Like, for, just to bring people in. Don't you think? Like, i- if you're driving by an Audi dealership and you saw the R8, you'd go in, maybe you wind up with an A4. But, you know, it drew people in. It brought, it brought aura to the brand. This does the same thing.

• 50:47John Coogan?

  Just seeing more 1993 Range Rover Classics in perfect condition on the road will make a 2026 autobiography look cooler and feel cooler. And so that's beneficial to the whole company.

• 50:59Jordi Hays?

  Yeah, and, and it will be, it'll be very interesting to see the way, the way in which manufacturers approach this category. The criticism of a lot of Resto Mod companies is they'll take like, they'll basically take a, you know, $20,000 car, do a little bit of work to it and mark it up like $200,000. And that doesn't, that doesn't, that doesn't feel great.

• 51:26John Coogan?

  Yeah.

• 51:26Jordi Hays?

  But.

• 51:27John Coogan?

  You know what feels great? Running a business on Shopify. Shopify is the commerce platform that grows with your business and lets you sell in seconds, online, in-store, on mobile, on social, on marketplaces, and now with AI agents. And we have our first guest of the show, Ferdinand Dabitz from Augustus. Let's warm up the.

• 51:46Jordi Hays?

  He's back.

• 51:50John Coogan?

  We got some big news. We raised some money. Welcome back to the show. You absolute dog. Uh, how are you doing? Give us the update. What's going on with the business? What's the news?

• 52:00Ferdinand Dabitz?

  No, um, yeah, I'm, I'm feeling good. I like this car stuff. By the way, I have a 2009 Land Rover.

• 52:08Jordi Hays?

  There we go.

• 52:08John Coogan?

  Cool.

• 52:09Ferdinand Dabitz?

  Myself.

• 52:10John Coogan?

  That's a great car.

• 52:11Ferdinand Dabitz?

  So that's good. No longer for Augustus.

• 52:15Ferdinand Dabitz?

  Again, we raised some money. I think one thing we always liked about the, about the bank thing is that it felt so hard. Right? And was this like.

• 52:24Jordi Hays?

  And now you're making it look easy.

• 52:25John Coogan?

  Yeah, you are making it look easy.

• 52:26Jordi Hays?

  I wanted something that felt hard so I could make it look easy.

• 52:31Ferdinand Dabitz?

  Make it look effortless, right?

• 52:33Jordi Hays?

  You are making it look effortless. I remember we, when we hung out, uh, I think it was at the end of last year, during, during the holiday season, you were like, yeah, I'm working on this thing. And here you are, uh, less than a year later.

• 52:47John Coogan?

  $180 million Series B, $1 billion valuation. Tiger Global's in. You got a bunch of other folks in. What actually did unlock the new round? Like, what's the progress of the core business?

• 53:00Ferdinand Dabitz?

  I think it's a great question, right? I think there are these, probably are these three, three things that were and are still exciting about the business, right? I think that the first thing is just this big idea around dollarization. Right? And Augustus is built to dollarize the world. Um, and I think people have really started to understand that that's a super important thing. Right? And I think over the last 20 years, we've seen a trend towards de-dollarization effectively, right? Like, if you look at the distribution of the dollar globally, um, kind of like traditionally distributed through these clearing banks, these correspondent banks, that chart goes down and to the right, right? Like, the number of clearing banks has just, um, has just fallen, fallen off year over year. Um, and people were kind of like excited about it, right?

• 53:43Ferdinand Dabitz?

  Because post 9/11, people said, okay, it's like, kind of risky to like, um, distribute the dollar and be a bank in Latin America, be a bank in Middle East, be a bank in Africa. Like, you probably don't want to do that, and then so, so it should be super expensive. Um, and, and so on and so forth. And people, like, from a macro point of view, started to regret that. And I felt like, okay, actually, it's kind of great if people use the dollar all around the world, right? I think it's, it increases dollar demand, right? It's anti-inflationary. And it's also this incredible instrument of soft power, um, right? The first thing we do when Russia goes to Ukraine is we take them off Swift and we shut off their dollar clearing. And this is amazing thing where we don't have to send the tanks and the, the, the boys. We can still influence what's going on, right? And so there was this like idea like, hey, should we maybe like revert that trend and build a modern correspondent bank, right?

• 54:26Ferdinand Dabitz?

  A modern dollar clearer, um, that, that can dollarize the world, right? And provide high quality dollar access to places outside of the United States. I think that was the first big idea that really made a lot of sense. From, from a policy point of view, right? And I think it enabled us to charter this bank. But I think also like, like, private, private counter markets were able to buy, buy, buy into it. So I, I think that was the, the, the number one thing. I think then the second macro thing was this idea, AI bank. Right? If you now build a modern correspondent bank, what does that mean?

• 55:03Ferdinand Dabitz?

  I think so.

• 55:04Jordi Hays?

  I like the sound of it. I like the sound of it.

• 55:07Ferdinand Dabitz?

  I, I, I think, I think it kind of like, um, it makes sense, right? Like, I think global economy is on this like consistent investment thesis to, uh, that every major industry is going to be transformed by AI. And I think Augustus is genuinely one of the few assets companies that has exported to doing that for banking, right? Because Augustus is a bank itself, not yet, conditionally approved, as you guys know. Um, and is also kind of young enough and, and cool enough to be a legitimate technology company, right? And so we felt like, they, they felt this like legitimate opportunity to take this very operationally intensive business, dollar clearing, correspondent banking, where Citibank has tens of thousands of analysts in the wire room that go through the payment file and do the reconciliation and pay and take it and just automate a bunch of it

• 55:52Ferdinand Dabitz?

  and turn it into a better business for customers with, with better economics, right? And so, so that, that, that felt, I think, pretty good. And then I think the third thing was just the progress that the team has made over the last year or so, right? We, we got the US National Bank conditionally approved. Um, I think we're the eighth company in the history, not in the history of the United States, eighth company since 2010, a younger history to, to kind of like get, get the condition approval, that was a big one. Um, and then we're already kind of big on euro clearing, right? We scaled a couple of billions of euros for some of the largest fintechs and FIs in the world, and that business was also growing very fast. And so I think these things coming together felt like, like a, like a good moment and, and kind of like resulted in that round, let's say, is my little play by play.

• 56:32Jordi Hays?

  Awesome.

• 56:32John Coogan?

  Do you have something?

• 56:33Jordi Hays?

  No, go for it.

• 56:35John Coogan?

  How, yeah, I mean, you mentioned that, like, we are on an upswing of dollarization right now, and that feels like a narrative violation because over the past two years, we've been in this period of deglobalization, tariffs, there's international conflicts. Like, I don't love it, but I could totally imagine a lot of international countries saying, well, we're going to pull back from our relationship with the United States because they're, you know, levying tariffs all over the place and seem to be adopting an America first strategy. Like, is, is, what am I misreading about the international climate that's actually driving increased dollarization in 2026?

• 57:19Ferdinand Dabitz?

  Yeah, I think, I think it's like less empirical as in this is actually happening. It's more like normative. Do we want this to happen?

• 57:24John Coogan?

  Sure.

• 57:25Ferdinand Dabitz?

  Right? And what, what kind of world do we want to live in? And I think people are starting to come around to this idea that we want to live in a dollarized world. And that wasn't always a, a given. And I, I think it wasn't even a given for the last 20 years. As I said, like, since 9/11, like, I think correspondent banking has been like increasingly unattractive business. And people say, stay away from banking non-US financial institutions, don't do it. And I think that, that, that the wind is changing on that a bit. And then I do think that the administration is actually much keener on dollarization than people give them credit for, right? I think all the work that the Trump admin is doing on, on stable coins, for example, it is largely driven by dollarization thesis, right? This idea that if we can like more effectively distribute the dollar abroad, it's, it's good for the United States, right?

• 58:08Ferdinand Dabitz?

  Because it's an instrument of soft power and increases dollar demand and is anti-inflationary. Right? And I think, um, that they're like, like, there's real school of thought in the admin that, that's big on this. And I think this is in a way like a policy and like a byproduct of that as a, the public private partnership that is a national bank, right? It's not just a normal company, it has to live in these, in these regulatory moments.

• 58:29John Coogan?

  Amazing. Well, congratulations. Keep up the great work.

• 58:32Jordi Hays?

  Incredible update.

• 58:33John Coogan?

  Hearing from you in just a couple of months at this pace. You're making it look easy.

• 58:37Ferdinand Dabitz?

  I'm glad to see you guys.

• 58:38Jordi Hays?

  Making it look easy.

• 58:39John Coogan?

  We'll talk to you soon.

• 58:39Jordi Hays?

  Yeah, great to see you, dude.

• 58:40John Coogan?

  Have a good one. Let me tell you about MongoDB. What's the only thing faster than the AI market? Your business on MongoDB. Don't just build AI, own the data platform that powers it. Our next guest is Kaiwei Tang from Light Phone, co-founder and CEO. How you doing?

• 59:00Speaker 04

  Hey, doing all right. Thanks for having me.

• 59:02John Coogan?

  Welcome to the show.

• 59:04Jordi Hays?

  Great to have you.

• 59:04John Coogan?

  We were debating this earlier. Do you, uh, so first, let's start with an introduction and then I have a bunch of questions about, uh, the correct terminology for this category.

• 59:14Speaker 04

  A lot of people call it dumb phone, but I call it simple phone.

• 59:17John Coogan?

  Okay, so you don't like the term dumb phone?

• 59:21Speaker 04

  Yeah, I mean, you know, your phone gets smarter, you actually get dumber. So we, you know, the phone, the phone need to do the tool, need to do what the tool does for us, like hammer, screwdriver, right?

• 59:32John Coogan?

  Yeah.

• 59:32Speaker 04

  It does that for you and you put it back. You don't swipe your hammer for five hours so the hammer company can make money. So that's exactly how we design Lightphone and all the tools inside the Lightphone.

• 59:43John Coogan?

  Okay, so minimalist flip phone is the newest product. Talk us through the evolution. How do you measure demand? Why, why flip phone? It's very nostalgic. I love the idea, but what was the broader thesis?

• 59:57Speaker 04

  Yeah, I mean, we've been doing this for 10 years. I think in back in 2015,

• 1:00:03Speaker 04

  we were in incubators for, in for Google creative for designers. And still talking to a lot of VCs and successful entrepreneurs, especially app entrepreneurs. We realized that everyone's racking about how much time, attention they get from their users. That's why they're successful. They could categorize, you know, analyze the data and sell the data to the highest bidder. That's the whole attention civilian economy. And I just don't like that. I don't want to see advertisement. I don't want to know, I don't want people to know where I am 24/7, but I love technology. I want modern technology without the civilians' attention economy built in. So what we're trying to do is offering a device that has all the modern utility tools,

• 1:00:48Speaker 04

  but without that business model building to maximize your attention. So you could call somebody, text somebody, get a direction home, listen to music, taking notes, you know, QR code reader, but no one's trying to maximize your attention so they can make money. Same idea, like we're not trying to ask people to give up technology. We're trying to say, hey, you, we all have different shoes, different car, different jacket, right? You could use different tool at a different scenario, right tool for the time. And that's the essential idea of Lightphone, being intentional about your time. Don't waste it on social media. When was the last time you or anyone else spent three hours swiping the TikTok and you snap out of it?

• 1:01:32Speaker 04

  Ooh, I feel so good about myself.

• 1:01:34John Coogan?

  Every day, baby, I'm on the internet, three hours every day. But yes, I am the exception to the rule. I am the screen time.

• 1:01:42Jordi Hays?

  How does, so, so assume the, you know, people listening are with, you know, Verizon or an AT&T or maybe another, another carrier. For the light phone, do you have to get basically an entirely separate number? Is there a way to use?

• 1:01:59John Coogan?

  Yeah. Is this something where I, I mean, I think it's maybe Chris Williamson talks about this, like the cocaine phone and the, and the vegetable phone or something like that. Like they will have one phone with all of the crazy apps on them. And then one that's like essentially a work phone. And when they, when they carry that phone, it's like brick. There's a whole bunch of different trends, but can you actually run like a single number with two phones?

• 1:02:23Speaker 04

  Yeah, I mean, that's, that's, that's healthy, right? You, we always need a balance. You could, there's different way to do that. You could turn on call forwarding. You could physically remove your SIM card on your smartphone, put into your, to your Lightphone. You could also utilize service, utilize service like T-Mobile digits. That give you two numbers, I'm sorry, two SIM card that tied to one number. There's different ways to, to utilize Lightphone as a secondary phone or primary device. But we actually see more of our customers using Lightphone as their primary device now, especially younger generation.

• 1:02:57John Coogan?

  Yeah, they go.

• 1:02:58Speaker 04

  I was in the, yeah, I was in the event in New York that a group of young people that promoting real life experience. And then the performers in front, in the stage, and there was a woman in the crowd, like taking, took out her smartphone and tried to record the performance. And everyone's booing her. You know, I think this, this is, this is no longer short term, not a retro feeling that, oh, just temporary feeling good about retro technology. I think this movement started by, by the young people, the Gen Z or younger is here to stay. As the AI, as this, you know, 5G, iPhone 45 keep getting bigger and bigger. I think this, the other side of the movement is going to get bigger and bigger too.

• 1:03:42Speaker 04

  And we're trying to give people the options that they can opt out.

• 1:03:45Jordi Hays?

  What would it take to add Instagram reel?

• 1:03:49Jordi Hays?

  Or, or maybe even like prediction market?

• 1:03:54Jordi Hays?

  Maybe you could make it discounted if people commit to doing prediction markets enough.

• 1:04:00John Coogan?

  Yeah, you preload 10K.

• 1:04:02Jordi Hays?

  Yeah. The phone is free as long as you're trading.

• 1:04:05John Coogan?

  Sort of a gambling phone.

• 1:04:07Jordi Hays?

  Five thousand dollars a month.

• 1:04:08Speaker 04

  Hey, if you pay the phone.

• 1:04:10Jordi Hays?

  More, more seriously, how are you, how are you thinking about AI features? Because I, I imagine you're, you're, there's this tension between AI does give you the potential to interact with your devices in new ways, right? It's, it's cool to be able to like, you know, dictate to your, to your devices. That's gaining a lot of popularity right now, maybe later than a lot of people would have expected. But then on the other side, I can imagine that a lot of your core users to date like hate AI and they're trying to get away from it.

• 1:04:45John Coogan?

  Yeah.

• 1:04:46Jordi Hays?

  So how do you, how do you kind of thread the needle there?

• 1:04:50Speaker 04

  Yeah, I mean, I, I always said that, you know, AI is a tool, it's a software program that's very helpful and we should treat it as such. Meaning that we, when we started Lightphone, it's not because there's a new technology being invented. So we designed product for that, right? We designed product because we seen people frustrated, anxious, stressed out, not happy with their smartphone, social media, but there's no way out. I think the same logic applied to AI or this program, this tools. It can be really useful. It can be helpful as long as it saves my time. So I, you're free on my time to do things important to me and make me happy. I think that's a good outcome.

• 1:05:32Speaker 04

  However, you, you guys probably know, like with AI tool, more people work more hours. You've been notified all the time with the things happening. So I think treating this particular technology as one of your tools and design and use accordingly is the way to go. And we're not anti-AI per se, but we do see the sentiments among young people towards, you know, everything AI, the big tech push on AI, the discrepancy, the gap is getting bigger every day. As I witnessed it, you know, going to tech conference, the potential of AI is being praised. You go into this, you know, this, this real life experience that young people started, Leti Club, they, they don't, they don't care about AI.

• 1:06:16Speaker 04

  We've been interviewing flip phone users in the new product we created called Lightphone, Lightflip, the flip phone that, that we just announced today. We've been interviewing different flip phone users for, for the last six months. The one, one thing they never bring up is AI feature. No one wants an AI button on their phone. I mean, I have no doubt it's very helpful. I have no question that it can be the future technology that saves our time to, to do things that for us and we can move on quickly. But I just don't think it's being designed as such at the moment.

• 1:06:51John Coogan?

  Take us through the business side, the business model, the customer acquisition funnel. This is a product that I feel like it naturally generates a lot of organic earned media. It's fun talking to you about this and all the knock on effects of, of, of phone use. I imagine every product reviewer reviews it. Like there's probably a decent amount of attention that effectively comes for free in this category. But what does the, what does the actual scaling of the business look like? Are you doing like direct response ads on Instagram reels to get people to uninstall? Are you, are you Adam Mosseri's worst nightmare?

• 1:07:31Speaker 04

  No, so as a matter of fact, we don't utilize advertisement. We don't pay social media to promote Lightphone. So the last 10 years, all our growth are organic, from water mouth, from press, from celebrities that are using Lightphone, including Aaron Paul from Breaking Bad, Pete Davidson, Ed Sheeran from UK. We got a lot of people that, that resonating with what we're trying to do and support it and, and, and spread the word of a Lightphone. So the last 10 years, we grow, you know, every year 20% to 50% without any advertisement. I guess, I think it's only human that this resonates with a lot of people.

• 1:08:12John Coogan?

  Yeah.

• 1:08:13Jordi Hays?

  Talk about the decision to include podcasts. There's, I, I know some people that are addicted to both making and consuming podcasts.

• 1:08:28Speaker 04

  That's a tough one. I think every tool that we designed followed the same principle. I can summarize into three principle. Number one, no advertisement. Number two, every action user take as a clear ending.

• 1:08:41Jordi Hays?

  Well, we have, what about, what about ads in podcasts?

• 1:08:44John Coogan?

  Yeah, we got, we snuck ads from the Lightphone.

• 1:08:46Jordi Hays?

  That's how you get in front of the Lightphone users is you gotta just advertise.

• 1:08:51John Coogan?

  From podcasts, negatively, here we go.

• 1:08:53Speaker 04

  Well, so similar to how we design music tool, right? Like it's not a Spotify, we designed it as an MP3 player that you intentionally create a playlist for you to calm down, for you to be creative, for you to get into certain mood using that tool as the tool. Spotify, Spotify podcast, I'm sorry, podcasts the same way. We see it as an educational tool, but I, I get it. Like loophole might be advertisement in the podcast, which we cannot control.

• 1:09:20John Coogan?

  But I like the idea of an old school MP3 player. There's something very satisfying about actually curating an intentional playlist, loading it up for a different moment, like it is, yeah, it's a special, special moment.

• 1:09:32Speaker 04

  Well, everything intentional makes things special, right? Everything that you're intentional doing make that experience special. The object design for one purpose make it special too.

• 1:09:42John Coogan?

  Yeah.

• 1:09:43Jordi Hays?

  How do you, how do you think about, what does success look like for Lightphone? Like is like a million, is a million people globally that, you know, use and love their Lightphone and, and, you know, get a new one every year when you make it newer, faster, lighter, longer battery life?

• 1:10:01Speaker 04

  Now, plan obsolete is not something no interest in. The last eleven years, we introduced three phones. In Light Phone two, we still have user using them. We're still selling them. It's been six years. We stand behind our product. We upgrade the software. We upgrade, I'm sorry, we repair Light Phone locally here in Brooklyn. And that's what we're gonna do. We're not asking people to buy a new phone every year. There's no need, there's no reason to buy a new phone every, every year. When's the last time you upgraded your hammer?

• 1:10:34John Coogan?

  Camera?

• 1:10:34Jordi Hays?

  Hammer.

• 1:10:35John Coogan?

  Oh, hammer.

• 1:10:36Jordi Hays?

  Hammer. Well, we have to update.

• 1:10:38John Coogan?

  We actually, we have a gong mallet that we upgraded a lot. But yes, I take your point. It is a tool. Like that, don't do.

• 1:10:48Jordi Hays?

  We're pretty rough on our, on our gongs.

• 1:10:51John Coogan?

  Yeah, so we got upgraded a lot. But for the average person, one hammer is a lifetime.

• 1:10:56Jordi Hays?

  No, it's a great, it's a great, it's a, no, it's a great, it's a great point.

• 1:11:00John Coogan?

  Congratulations on the launch.

• 1:11:01Jordi Hays?

  And, and yeah, I was just asking that because I feel like, uh, it's, it's, phones are somewhat like cigarettes in that people know that they're bad, but they're just so good in some ways, uh, for some people at some times. But I was gonna say, even if you have a million people that are just like, you know, like, true, true believers that are willing to make certain sacrifices in terms of like, some, some features and things like that, you could still have a really thriving, uh, business, uh, and, and, uh, and it feels like, you know, it's not a billion users or bust here.

• 1:11:41Speaker 04

  Oh, twenty, twenty-eight percent of Gen Z are strongly interested in acquiring a now smartphone. Twenty-six percent of millennial interested in getting, getting a now smartphone. Twelve percent of Gen X interested in getting a now smartphone.

• 1:11:57John Coogan?

  The Gen X voters really don't care.

• 1:11:59Speaker 04

  This trend is not gonna stop.

• 1:12:01John Coogan?

  Yeah.

• 1:12:02Speaker 04

  Yeah, this trend is gonna get bigger and bigger.

• 1:12:04John Coogan?

  Very cool. Well, thank you so much for coming on the show. Congratulations.

• 1:12:08Jordi Hays?

  Very cool.

• 1:12:09John Coogan?

  On the light phone dot com. You can go and preorder one. It's available for preorder and the light flip is shipping April twenty twenty-seven. Thank you for coming on the show.

• 1:12:19Jordi Hays?

  Great to meet you.

• 1:12:20John Coogan?

  Talk to you soon. Have a good day.

• 1:12:21Jordi Hays?

  Cheers.

• 1:12:21John Coogan?

  Goodbye. Let me tell you about CrowdStrike. Your business is AI. Their business is securing it. CrowdStrike secures AI and stops breaches. Uh, our next guest is the best. We got Chris Best, the founder and CEO of Substack. Welcome to the show, Chris. How are you doing?

• 1:12:39Speaker 05

  I'm doing good, man. Thanks for having me.

• 1:12:41Jordi Hays?

  The great slop wars.

• 1:12:42John Coogan?

  Yes.

• 1:12:43Jordi Hays?

  Have entered a new era.

• 1:12:45John Coogan?

  It's not just nice to talk to you. It is amazing.

• 1:12:48Jordi Hays?

  It is the best.

• 1:12:49John Coogan?

  It is the best to talk to you. Uh, tell us about the slop problem on Substack. Uh, what is the shape of the problem? What motivated this? Take us through the new product. What's the state of the union in the slop fest? The trough, the state of the trough.

• 1:13:06Speaker 05

  I mean, the place I started with this, I've had the experience that I think a lot of us have had, not on Substack, but just on the internet in general. I'm scrolling the timeline, I'm reading stuff, and sometimes I just have this experience where I'm reading something, sometimes it's by someone that I think I know, sometimes it's something. And I have this kind of Invasion of the Body Snatchers experience where you realize you're sort of reading something that was actually just pure Claude.

• 1:13:31John Coogan?

  Yeah.

• 1:13:32Speaker 05

  Purely generated.

• 1:13:33John Coogan?

  Yep.

• 1:13:34Speaker 05

  Um, and it's kind of, you know, it, it makes the experience reading on the internet worse because you're constantly wondering. You constantly have to wonder, is this real?

• 1:13:43John Coogan?

  Yeah.

• 1:13:44Speaker 05

  Am I actually reading something this person believes in?

• 1:13:46John Coogan?

  Yeah.

• 1:13:47Speaker 05

  Or, you know, did Brian Chesky get hacked? Or whatever's going on?

• 1:13:50John Coogan?

  Yeah.

• 1:13:50Speaker 05

  Um, so I, like, I've been feeling this. A lot of the people I know who spend time online have been feeling this. And then the guys at Pangram did this study, because they've been running this browser extension, right? Where they have their own browser extension. You can install and you can just have stuff labeled.

• 1:14:03John Coogan?

  Yeah.

• 1:14:03Speaker 05

  And they studied different platforms and they found that on some platforms, like, I think LinkedIn, forty percent of the long-form text is generated by AI.

• 1:14:14Speaker 05

  And, you know, in my view, it's not the case that all AI is necessarily.

• 1:14:17Jordi Hays?

  Ninety. But.

• 1:14:21Speaker 05

  Yeah.

• 1:14:22John Coogan?

  Yeah, it's going back.

• 1:14:22Jordi Hays?

  Forty's a lot.

• 1:14:23Speaker 05

  Well, and, you know, a good point here is not, not all slop is AI, you know, LinkedIn, even pre-AI, had a lot of, had a lot of stuff on there that's, you know, uh, maybe not the best.

• 1:14:33John Coogan?

  Pretty sloppy sometimes.

• 1:14:35Speaker 05

  Depending on your perspective. I mean, some people like it, that's fine. Um, and I think, you know, they had Substack coming in about ten percent. Um, I started looking at this, I started thinking about this, and to, to my mind, the problem is not people using AI. The problem is when you have kind of the deception that comes with, I'm expecting that I've got a real connection to a person.

• 1:14:58John Coogan?

  Yep.

• 1:14:58Speaker 05

  And I'm actually reading something that's written by no one.

• 1:15:02Jordi Hays?

  This photo is my experience, uh, when I realize I'm reading AI text.

• 1:15:08John Coogan?

  Yeah.

• 1:15:08Speaker 05

  This, yeah, this is the moment you realize. And the moment you realize, that's when, I think of this as Claude fishing.

• 1:15:13John Coogan?

  Yeah, yeah.

• 1:15:14Speaker 05

  It's about the violation of expectation. And it's the fact that you realize, and then you're like, oh, this changes the experience that I'm, I think I'm having.

• 1:15:20John Coogan?

  And it's so weird.

• 1:15:21Speaker 05

  I'm not against reading AI texts. I read AI texts all the time.

• 1:15:24John Coogan?

  Yeah, we, when, when there were those rumors that like OpenAI was thinking about a social network and it was still really, really early, I was like, I would love to be able to subscribe to a feed of Tyler Cowen's deep research reports. Because I know he's using these tools. I know he's coming up with really interesting and creative prompts, probably asking about like, what's the food like in this random town internationally? And like, I would like to learn what he's learning. And, but the, but the whole premise of that would be that I'm just getting a link to chat GPT dot com. And people do share these around, but we haven't really, because we're not in like the link sharing world, people haven't actually coalesced around like, yeah, I'm just gonna share you a link to my deep research report. But sometimes that would be better than you took, you, you

• 1:16:08John Coogan?

  copy and paste it and you forgot to put the, is there anything else you'd like me to help you with or whatever?

• 1:16:13Speaker 05

  Or you left it in, then you get these sales emails that leak the prompt to you.

• 1:16:17John Coogan?

  Yeah. And so I can imagine that there's probably a really banger Substack out there that where the, the journalist or the writer is gonna say, look, I'm gonna go, I'm gonna go find an interesting fact, or I'm gonna give you a roundup, and I'm going to do the work of prompting and fact checking and making sure that this AI instantiated newsletter is high quality and high quality enough.

• 1:16:40Jordi Hays?

  Yeah, the example that I always give is like, uh, if Alex Heath.

• 1:16:44John Coogan?

  Yeah.

• 1:16:45Jordi Hays?

  Was using AI.

• 1:16:46John Coogan?

  Uses AI, often.

• 1:16:47Jordi Hays?

  Yeah, he's talked about it. But like, Alex Heath using AI, I'm like, great. I, I'm, I'm not subscribing for the, the like, writing. I'm, I'm subscribing for information, the facts that he's finding.

• 1:17:01John Coogan?

  Textualization.

• 1:17:02Jordi Hays?

  Plus the takes and like his point of view on that.

• 1:17:04John Coogan?

  Yep.

• 1:17:05Jordi Hays?

  And if he's just, if he's just ram, if he just like finds the facts and then does dictation and just kind of rambles for ten minutes, turns it into something that, uh, is, you know.

• 1:17:16John Coogan?

  Yeah.

• 1:17:16Jordi Hays?

  Short and.

• 1:17:17John Coogan?

  But the disclosure is important. So.

• 1:17:19Speaker 05

  Right. Yeah, the way you can tell that's good is because the disclosure wouldn't ruin it for you.

• 1:17:22John Coogan?

  Totally.

• 1:17:23Speaker 05

  And we have all takes on the platform. We have everybody from, you know, Sam Crist wrote a piece recently that said, if you let AI do your writing, I will come to your house and kill you.

• 1:17:30John Coogan?

  That's a death threat. You can't say that.

• 1:17:32Speaker 05

  Tell, I can tell. Um, and then, you know, we have people that are doing the thing you're suggesting that are, that are using these tools to like, slop is not something made with AI. Slop is something that nobody believes in. They didn't actually care about. Right? If you just go and say, hey, write me a thousand viral LinkedIn posts, make no mistakes. That's slop.

• 1:17:48John Coogan?

  Yeah.

• 1:17:48Speaker 05

  If you spend, you know, if you're doing this deep thing where you're going back and forth and you're doing it, I talked to a bunch of people who do this on the platform, and they're worried about slop too. Because in a world where you get a bunch of things that are like low effort or like zero authorship stuff masquerading as somebody's careful work, it drowns out the actual careful stuff.

• 1:18:08John Coogan?

  Yeah.

• 1:18:08Speaker 05

  Like you can have a platform where like the good, high effort, thoughtful things get outcompeted by people just like spamming the zone with stuff.

• 1:18:18John Coogan?

  Yeah.

• 1:18:18Speaker 05

  And I just think that's gonna be, I think that's already a real problem on some platforms. It's not a huge problem on Substack yet, but we kind of want to make sure that we're just, you know, keeping the bar high and having, giving the people who are making stuff they believe in the chance to win.

• 1:18:31Jordi Hays?

  Have you seen any, uh, like generational divide between how publishing, uh, AI writing is perceived? Because there's been a number of VCs, at least over on X, uh, that are, that are maybe, maybe in like the back half of their career, where they'll just publish an essay that's just like incredibly obvious that it's just like, you know, they, they maybe didn't, they maybe had like a couple key ideas that they gave the model, and then they just took the output and just published it. And they'll usually get kind of dunked on. Um, uh, but, uh, it, it seems as though the offer, author was not even necessar, or

• 1:19:11Jordi Hays?

  the author was not necessarily even sort of aware that, that there's like a negative perception or that it's maybe obvious to other people. Uh, have, have you seen anything? Like, have you seen a divide at all? Or is it just sort of random?

• 1:19:27Speaker 05

  I think we're in a period where these, there's like new norms that are getting figured out. It's not clear what the rules and expectations are, and there are, there are people that have wildly different ideas of what good is. I don't think it's purely generational. I think there's people on all camps. To me, the thing, you know, I think that anti-slop is a pro-AI stance.

• 1:19:45Jordi Hays?

  Yeah.

• 1:19:45Speaker 05

  Right? You don't see Sam Altman or Derry Amade writing, doing these like Claude posting things, and it's not because they don't believe in AI.

• 1:19:52Jordi Hays?

  Yeah.

• 1:19:52Speaker 05

  Um, so I don't, I don't think that it's a, it's an anti-AI thing.

• 1:19:56Jordi Hays?

  Yeah, like I, I think you can be incredibly in favor of maximally using AI to, to do research and be a, be a, you know, even a, a thought partner and edit your work and help you think of even new ideas to include, but it's like, uh, but it's about, it's, it's about ultimately,

• 1:20:19Speaker 05

  Yeah.

• 1:20:20Jordi Hays?

  it's about ultimately creating something that's worth people's time, right? That they couldn't have just gotten by asking the same question to the same model, at least in my view.

• 1:20:31Speaker 05

  Claude is great, but if I want to talk to Claude, I can just talk to Claude.

• 1:20:34Jordi Hays?

  Yeah.

• 1:20:34Speaker 05

  And if I'm reading you, it's because I want, there's like something else. I mean, another way to look at this, you, you know, you gave the example of like, what if Alex Heath were making this really thoughtful thing? I would love that. I think everybody has an example of something where they're definitely cool with it. Everybody's talking to AI. It's, it's valuable. On the other end of the spectrum, do you remember the guy when sort of OpenClaw was at its fervor? That was famous for having the bot text his wife? He was like answering his wife's texts.

• 1:20:57Jordi Hays?

  Is that real?

• 1:20:58Speaker 05

  I think almost everyone can look at that and be like, okay, that's probably not legit.

• 1:21:02Jordi Hays?

  Yeah.

• 1:21:02Speaker 05

  And then there's a whole bunch of stuff on the internet that kind of falls in the spectrum between, you know, thorough research report with AI pros all the way to like, you know, having, not having to answer my wife's texts. Like if I'm going back and forth in the comments with you, what's the expectation? If you're writing a piece, what's the expectation? Does it matter? Is it different if you're writing a personal story versus a? I think these things are all like new norms that will have to get created. I don't think we at Substack have all the answers. And so this is why we're kind of leaning as a first step. We're like, hey, let's just have some transparency. Let's make it so that readers can scan this text if they want and have that information and do with that, you know, make their, form their own judgment.

• 1:21:39Jordi Hays?

  Yeah.

• 1:21:40John Coogan?

  Uh, how, how do you think, um, the, how do you think writing is changing for writers who don't use AI? I've noticed personally, I've been writing video essays in the pre-ChatGPT era. Then all the models were not really great for a while. Then I started doing daily essays on Substack, uh, got accused of using AI even though I wasn't. Uh, sometimes we would pass them through AI to just fact check and grammar correct. And then that gave it the AI flavor. And so I made the decision for, uh, with the team to just like not proofread them basically.

• 1:22:22John Coogan?

  And so I will often be doing research in a bunch of different AI tabs and collect information. But then I'll go and just complete stream of consciousness, nonsense grammar, all these weird twists of phrases like I'm just speaking out loud. And I think it's remained like, I'm getting less and less AI accusations, I guess, even though I'm like, I, I, I just writing daily, I think you're gonna get accused of using AI because it's so obvious that you would save a lot of time by not actually going and doing the work. But I'm wondering if you think that that is just a unique thing to me or if that was.

• 1:22:59Jordi Hays?

  Well, it's not even just a problem with writing. I, I've noticed on YouTube, there's creators that, that, uh, that I used to love. That make like history or geopolitical content or just like weird niche content, even car content. And now I have that same experience of like ripping the headphones off because I realized that somebody that used to put like all this energy into like writing these great scripts and telling these stories, you just start hearing the, the claudisms in the video. And even though they're just like making an output, making a script and then reading it, it's still like coming through and you can still tell that, that they didn't put craft into it.

• 1:23:38John Coogan?

  Yeah.

• 1:23:38Jordi Hays?

  And so I've seen on YouTube, there's creators that are just like in the description or even in the introduction of the video saying, and to be clear, I don't use any AI in my videos. Um, and again, like even as somebody who's very pro-AI, I find myself like, I, I, I feel like a little bit comforted hearing that because of all the bad experiences where I've gotten three minutes into a video and, and realize like, okay, this person is just reading a script that was a, a one prompt.

• 1:24:07Speaker 05

  Mm-hmm. Yeah. And we added this to the feature we launched too. So if you, if you're, uh, writing something on Substack, you can set like a how I make this statement. Where if somebody's scanning your thing and it can say, hey, I never use it, or hey, I use it in this way. Or even, you know, hey, I use it extensively, but here's the, here's the perspective I'm bringing. Here's what you can get from me. I think it's, I think, and I think this is true no matter how, it gets more true as AI gets more powerful.

• 1:24:30John Coogan?

  Yeah.

• 1:24:30Speaker 05

  Right? One critique is, is, oh, I, I don't like it because it's bad, because it's like a claudism or because it's just like detectable. But I actually think the underlying thing is like, am I getting a human perspective here?

• 1:24:41John Coogan?

  Hmm.

• 1:24:42Speaker 05

  And the more powerful the AI becomes, the more important it is to know that. Because if I'm not, it might still be great. But again, it's like, if I want to talk to Claude, I can talk to Claude. The question is like, what human believes in, stands behind, has the perspective that I'm spending my time and energy ingesting?

• 1:25:00Jordi Hays?

  Yeah. The other, the other thing with, uh, Substack is like, you're paying for a media product when you subscribe to someone, but you're also paying to, in many cases, at least personally, allow somebody to pursue a life's work. And if, and, and that to me is like part of the sort of like social contract that you have when you subscribe to someone, which is like, you know, I am in a small way, I may, I might be one of 10,000 people, but I'm allowing you to ditch your job and just pursue like an understanding of this, of this industry or, you know, this market or whatever. And so that's also like, you know, if somebody just decides one day, okay, like I'm kind of done with this whole,

• 1:25:43Jordi Hays?

  you know, uh, independent writing thing, I'm just gonna, uh, slop it up for the, as long as I can. People will churn, but you know, like that, that, that would be, you know, violation, um, at, at, at least in my view.

• 1:25:56John Coogan?

  Do you think your recommender system will naturally sort audiences into what they like? So if there's someone who's subscribing to more AI-generated Substacks, they would get recommended into that and they would be satisfied with that? Is there gonna be like a barbell effect here where you imagine there's like power law creators who use no AI, power law creators who use all AI?

• 1:26:21Speaker 05

  I think there will be some of that, and I think these, these tastes will change over time. But something I've noticed in myself and in people I talk to about this is a lot of these things are kind of an acquired distaste.

• 1:26:29John Coogan?

  Hmm.

• 1:26:30Speaker 05

  Right? It's something where, you know, a few years ago, maybe I wouldn't even recognize this as being different.

• 1:26:35John Coogan?

  Yeah.

• 1:26:35Speaker 05

  And now I sort of have that skin crawling feeling. I think more people, not everybody has developed that already, but I think more people will develop it than have today. But then look, I think ultimately, you know, our perspective on this, we're pro-freedom. We're not sitting here telling you what tools you can and can't use. We're not sitting here telling you what you can and can't read. As long as you're making the decision, you know, as your best self, what do I value? What do I want to spend my time and money on? We're happy with that. We want to kind of help people do that. And so if, you know, I, if there are places where people are, you know, paying for AI's stuff and it's the stuff that they want and the person making it, like, we, we think that's great. Uh, as long as it's, you know,

• 1:27:14Jordi Hays?

  Yeah.

• 1:27:14Speaker 05

  people are looking at it with their eyes open, they know what they're getting.

• 1:27:16Jordi Hays?

  Yeah. It's funny like how I, I would certainly pay $5 a month to just get a feed of Tyler Cowen's like ChatGPT prompts, right? Because I'd just be interested to fall, like I would just be interested to like sort of passively learn about. Uh, and I'm surprised no one is like, you know, figured out a way to create that kind of product yet. Um, what do you think is like the, is there an AI writing product that is overtly AI that's actually been, you know, massive breakout hit? And that they've, they've fully disclosed that this is, you know, AI-generated, but, but it still works? Any, any that you're aware of?

• 1:27:55Speaker 05

  You mean, are, are there examples of texts?

• 1:27:58Jordi Hays?

  Like I mean, somebody that like made it, made a Substack and it's like, hey, this is $5 a month and I'm just gonna give you breaking news and analysis on these types of, uh, topics. And it's all AI-generated and like actually have, has anyone built a, a real business?

• 1:28:14John Coogan?

  The equivalent would be like Demon Flying Fox on YouTube. He, he's the one that did the Harry Potter Balenciaga. He is like an AI-first video creator. It's very clearly disclosed. There's a number of Instagram accounts where like the whole thing is like imagined AI futures and they are creators, but they openly use AI. I'm wondering if there's a version of that for text or Substack.

• 1:28:36Speaker 05

  That definitely exists, and that's the thing that I believe in, right? The idea of like an AI powered creator.

• 1:28:43John Coogan?

  Yeah.

• 1:28:44Speaker 05

  The way I think of this is like AI gives you superpowers and it just also gives you new ways to be annoying on the internet. But if you're, if you're, you know, A and AGI is not supposed to stand for annoying. But the, like, okay, if you're saying like, I have this perspective and I'm using these tools, like, I think that Harry Potter Balenciaga thing is genius.

• 1:29:02John Coogan?

  It's great.

• 1:29:04Speaker 05

  It's genius. And I don't care that they used an AI tool to make, in fact, it's great. It's like, it's a new way to express the thing.

• 1:29:09John Coogan?

  Yeah.

• 1:29:10Speaker 05

  And we have, we actually, there is a bunch of that on Substack. There are people who are doing analysis, people who are sometimes writing things in other languages. There's people that are like writing and like, English is not their first language, but they have some important analysis or they're like, you know, they're doing some deep research or they have some perspective and, you know, the final prose is generated, but they're transparent about that. I think that is great. The question, the deeper question to me is like, do you actually have to have a human artist behind the thing? Like, if instead of that, if instead of, I've used AI tools, if you're kind of doing the thing of like, hey, you know, generate 1,000 viral posts, make no mistakes, or generate 1,000 viral bots that each do 1,000 viral posts, make no mistakes. And my view is like, that may be compelling, but that's not going to be valuable over

• 1:29:55Speaker 05

  time because it's going to be, there's going to be no differentiation. It's the thing of like, yeah, talking to Claude is great, but I can talk to Claude if I want to talk to Claude.

• 1:30:02Speaker 06

  That makes sense.

• 1:30:02Jordi Hays?

  Do you know of any historical comps to this conundrum that we're in as citizens of the internet? Like, was there a period where, where authors weren't real authors if they used a typewriter? You know, you had to, you had to write it with a, with a pen or, or it was frowned upon? Or is this just like a, a, a novel experience?

• 1:30:28Speaker 05

  I found, when I was looking for the art for the announcement post I did, I found a reverse example from history, reverse Claude fishing, which was the mechanical Turk. Do you guys know the story? It was, it was supposed to be a robot that plays chess.

• 1:30:39John Coogan?

  Yeah.

• 1:30:39Speaker 05

  And so it was, it was supposed to be like a magic strong chess playing AI. But the, the, the trick was there was actually like a chess master kind of like hiding in the bottom. Just sort of, it's the reverse of having the, you know, having that realization of you're absolutely right while you're reading something.

• 1:30:55John Coogan?

  Yeah. Yeah, that's great. Well, congratulations on the launch. It seems like it's going really well and we're huge fans of Pangram and the team over there, so.

• 1:31:06Speaker 05

  Those guys are great. They're the best detector. We're proud of them.

• 1:31:08John Coogan?

  They really are. Yeah, yeah. What a great partnership.

• 1:31:10Jordi Hays?

  In two more minutes before you leave, what, what can people expect out of Substack for the rest of the year? Like, are you, are you?

• 1:31:17John Coogan?

  Yeah. How's the business doing in the age of AI broadly? Like, there's a narrative where it's like, oh, people would just talk to the AIs to get information. They're going to spend no time on Substack. And then there's another one, which is like, you'll be 10 times more efficient because all your software engineering can be automated. Like, what, how is the business actually changing?

• 1:31:34Speaker 05

  Business is doing well. We're growing. You know, the way I think about this is, I think as you get sort of plentiful, you can get anything from the AI, you can get any content, the value, you have infinite kind of like things that you can spend your time on, the value of the trusted human connection and perspective goes up. And as long as we can have the platform reward that, as long as you feel like, hey, you know, like, even if you're reading Tyler Cowen's prompts, the fact that you know, have some idea of Tyler Cowen as a person and have, invest some faith and trust in him is a fundamentally valuable piece in this new world. And we actually think this is, again, it's like, if you take sort of a pro AI stance,

• 1:32:20Speaker 05

  you can also have like a pro human culture stance that thinks that we're going to be able to make that even more valuable.

• 1:32:26John Coogan?

  Yeah. That's very cool. Well, congratulations. Thank you so much for coming on the show.

• 1:32:30Jordi Hays?

  Great to see you. Always fun.

• 1:32:32John Coogan?

  We'll see you soon.

• 1:32:32Jordi Hays?

  Cheers.

• 1:32:33John Coogan?

  Let me tell you about Consol. Consol builds AI agents that automate 70% of IT, HR and finance support, giving employees instant resolution for access requests and password resets. Our next guest is here with us in the TVP in UltraDome Live. How are you doing, Stephen? Welcome to the show. Stephen, this is co-founder and CEO of WAP. How are things going with WAP?

• 1:32:53Speaker 06

  Things are going great with WAP. Thank you guys for having me here. It's super cool.

• 1:32:56John Coogan?

  Yeah, welcome.

• 1:32:58Speaker 06

  Yeah, it's a crazy time for, for the whole world right now.

• 1:33:00John Coogan?

  Okay.

• 1:33:01Speaker 06

  You know, I think a lot of the, the work we've been doing over the last several years is now coming to light in a way where there's a bunch of themes converging and, you know, you have, I mean, you have all, in conjunction with AI, you have a lot of people trying to figure out what they're going to do for work, what they're going to do with their jobs.

• 1:33:18John Coogan?

  Yeah.

• 1:33:19Speaker 06

  You have an existential question of how to get value accrual by spending money on tokens. And I think a lot of the infrastructure we've built is trying to answer a lot of that.

• 1:33:30John Coogan?

  Yeah.

• 1:33:31Speaker 06

  Things are going well and it's exciting times.

• 1:33:32John Coogan?

  At its best, you're bringing like a small scale entrepreneurial opportunities to people at a very, very broad basis.

• 1:33:40Speaker 06

  I think that's one way to look at it. I mean, we, we grew up, my co-founders and I, building businesses on the internet, piecing together a ton of different platforms. And at times we'd have like three or four businesses running at once and we were always the weird ones. There's no one else is doing that. And now it's pretty normal. And I think we are trying to build a platform that if we could go back in time, we would be addicted to as a 15-year-old. And I think that technology is there now where there is virtually no excuse to not have a really awesome income stream, especially from starting a business. And yeah, so I would say it's pretty cool.

• 1:34:20John Coogan?

  Yeah. I want your reaction to this take from Aporia about Gen Z entrepreneurship. As they say, Gen Z entrepreneurship increasingly looks like running a portfolio of asymmetric coups rather than betting on one serious long-term project. The, they go on to explain that half the people I meet at beach clubs in Saint-Tropez and Marbella are doing exactly this. One year it's crypto, then an Amazon brand, then an AI lead gen agency, then solar panels or some subsidized renovation. And this was the interesting line. I used to think this was unserious entrepreneurship, but some of them have become genuinely good at it. Their real business isn't crypto, AI or solar panels. It's being early.

• 1:35:04Speaker 06

  That's one of my favorite takes I've heard in a long time. And I think that the reality is the businesses are getting so ephemeral that one week it's a jewelry store, the next week it's a education program, teaching people how to use a new AI tool.

• 1:35:17John Coogan?

  Yeah.

• 1:35:18Speaker 06

  The next week it's a UGC marketplace. And then the next week it's a agency that's selling data to labs. So the amount of trends that people are tapping into to start businesses is through the roof.

• 1:35:29John Coogan?

  Yeah.

• 1:35:30Speaker 06

  And when that happens, you do get what resembles a portfolio, almost imagine like a crypto portfolio. But, and if you look at our new homepage, it actually looks like a crypto portfolio, but now tokens are businesses.

• 1:35:41John Coogan?

  Sure.

• 1:35:42Speaker 06

  And it's completely up to you to drive the business income up.

• 1:35:45John Coogan?

  Yeah.

• 1:35:46Speaker 06

  And we try to figure out ways to tell you exactly what to do next in order to do that.

• 1:35:50John Coogan?

  Yeah.

• 1:35:51Speaker 06

  So I think that's a fantastic, so it does feel like an exchange and yeah.

• 1:35:54Jordi Hays?

  If you, if, if, if you were able to talk to the, to the, you know, take you today and you have the younger version of yourself, what, what advice would you be giving on like, where to start trying to make money on the internet?

• 1:36:10Speaker 06

  I would simply look at what is working on the internet today and copy it. And I think.

• 1:36:17Jordi Hays?

  So, so when you were getting your start, it was trading sneakers and maybe having some bot tracking Supreme drops? Like, what was it then and what, what is actually happening now?

• 1:36:32Speaker 06

  Well, I think that your question is interesting because you said if, if they want to make money, that's one thing. And if they, if they, I think when we were building businesses, it was never really for the money. I mean, my co-founder Cameron dropped out of high school at 15 years old and had virtually unlimited money for a 15, 16-year-old. I think the only thing he bought was a Tesla. And other than that, he would, wearing flip flops and t-shirt and be working all day. And it was never really about the money quite exactly. It was always about, I mean, we have a hoodie, it's just building cool shit with your friends. And I think that is much more the spirit that we get excited about. And in many ways, we want to make it actually not about the money and take out money from the equation to be, don't have to worry about money. But it is, there's like, the advice I'd give to a young person.

• 1:37:16Jordi Hays?

  Yeah, that's sort of the unique luxury of being a teenager where it's like, if you, if you hit it out of the park and make $5,000, you feel like the king of the castle.

• 1:37:25John Coogan?

  Yeah.

• 1:37:26Speaker 06

  Yeah, totally. It goes a long way and you have a lot of time and you just have nothing else to do other than to experiment with different businesses. And it's, it's after Roblox, what are, what are all the kids supposed to do? And I think that's how we approach it, trying to build a very gamified arcade version of entrepreneurship and pursuit of building products for other people.

• 1:37:43John Coogan?

  Talk about looking at what works and what's making money on the internet, because I feel like there are layers to that onion. Sometimes by the time I'm seeing Instagram reels of somebody driving a supercar and they say they made their money on Facebook ads, like the Facebook ad arbitrage might have closed and that person might now be selling a course to get you to sell a course to then sell Facebook ads. There are like four levels of abstraction. What is the correct way for young people to actually go and find the real opportunities and not the things that have been abstracted into LARPs at this point?

• 1:38:24Speaker 06

  Yeah. Well, I think the infrastructure in every single one of those businesses is always the same. So when you, when you go and experiment with one business and then you go to the next one, a lot of that carries over.

• 1:38:32John Coogan?

  Sure.

• 1:38:32Speaker 06

  And I mean, what I would suggest is, is we try to do a very good job on WAP, showing which businesses are actually working really well.

• 1:38:39John Coogan?

  Sure.

• 1:38:40Speaker 06

  And which models are working really well. So my, my advice would be to go do that. But I think it's ultimately just try to experiment as much as you possibly can and, and don't feel like you're wasting a lot of time because the only real risk is, is not doing anything. And my, my probably overarching advice to young people would be just to try things out and see what happens and fuck around and find out, if you will, a little bit. So I, I think that that's, that's a very, that's the spirit of where we are now in businesses and how ephemeral everything's getting and how much experimentation you see when you open your Twitter feed. And that's, that's a good thing. It brings, it floods the market with competition. It floods the market with people that are trying to differentiate ever so slightly from the prior iteration. And that ultimately brings a lot more value to end consumers and makes everything cheaper

• 1:39:25Speaker 06

  and makes everyone a little bit more money. So I think that's a pretty good thing.

• 1:39:30John Coogan?

  Talk about the CLI.

• 1:39:34Speaker 06

  Finally, we have a CLI. Yeah.

• 1:39:36John Coogan?

  Why is that important?

• 1:39:37Speaker 06

  Well, yeah, so.

• 1:39:38John Coogan?

  Websites are pretty good. APIs work in many ways. What's the point of the CLI?

• 1:39:43Speaker 06

  I think people have historically found WAP to be relatively confusing of a concept. And I think the reason for that is because the UX that we've built.

• 1:39:51Jordi Hays?

  Made me feel like a boomer.

• 1:39:54Jordi Hays?

  I was on there, I was trying to spin up content rewards back in the day, very early with the show. And I was like, I feel old.

• 1:40:05Speaker 06

  Yeah, I think like the UX we've built has never really caught up to the API we've built.

• 1:40:09John Coogan?

  Sure.

• 1:40:09Speaker 06

  And I think that we're, we're a very fundamentally API-first company. We have a very engineering-led team. And that results in a fantastic API that has, I mean, when you look at the functionality that our API supports, it is literally every single thing that you could possibly need to programmatically run a business. That's payment acceptance, it's ad creation, it's money movement. You can even find people in the real world to do labor for you, clipping and whatnot, all via the API. That is very difficult to build a UX around, very, very difficult. And the CLI allows all the functionality to be brought into your terminal and to be called from any agent via API. And that results in way better experience. So the CLI is very cool.

• 1:40:54John Coogan?

  So hypothetically, if I start, the three of us start a haircare business together, since we all have wild hair. There are a number of steps that I'm going to take to promote my business. The, the classic one that I would go to WAP for might be clipping. I might film a whole bunch of content, you film some videos about your haircare routine. All of a sudden, we have the idea of a business. I like it. It's a style. And, and we want to take that to social media. So we want to engage with WAP broadly. Now, I could use an AI agent to interact with the API, the CLI. Does that just make it easier if I'm doing the programming? Or is there a world where I'm actually finding a programmer on WAP to help me with that side of the distribution?

• 1:41:38Speaker 06

  So the old adage is that ideas are easy and execution's hard. And we're seeing that be flipped on its face in, in real time. And I think that what we actually prefer is that, you know, there's a saying, it's also like, every business begins with a secret. And a lot of times the secret lies in the execution, but we want the secret to be all about the idea. So we want the extent of that launch to basically be, we want to start a haircut business for tech people with crazy hair.

• 1:42:02John Coogan?

  Okay.

• 1:42:03Speaker 06

  And that's the whole business.

• 1:42:04John Coogan?

  Yeah.

• 1:42:04Speaker 06

  And every other part of the execution is handled.

• 1:42:07John Coogan?

  Sure.

• 1:42:07Speaker 06

  And that is a way better world than what it is today, where you actually have to think through everything from even making content. You make the developer, that's all semantics, it shouldn't even be a conversation.

• 1:42:17John Coogan?

  Yeah.

• 1:42:18Speaker 06

  So that's what you get of the CLI. I mean, you can literally go to the WAP CLI today, say, start a haircutting business. That's meant for tech people with crazy hair. Get me some customers. And, and you could go so far, if it was localized, to say, find me a person to cut the hair.

• 1:42:33John Coogan?

  Interesting.

• 1:42:33Speaker 06

  And the CLI will end to end do that via any agent that you want.

• 1:42:36John Coogan?

  Okay, cool.

• 1:42:39Jordi Hays?

  Are, are the youth hitting it big with SMB AI transformation? So everyone knows the big, big consulting shops are printing billions.

• 1:42:52John Coogan?

  Real about this, it was like, if you want an SF90, go to someone's real estate listing and like take photos, turn it into a beautiful website, go sell it to the real estate agent for 500 bucks. Like go to, go tour a $30 million property that they're trying to sell, but they don't have a nice website for. They're just on MLS. Make a beautiful website, sell it to them for 500 bucks.

• 1:43:14Jordi Hays?

  Yeah, even, even, even back in our day, you could, even when it was easy to build a website, there were still business owners. I remember, I remember, you know, like a friend's parent at one point was like, if you can build me a website, I'll give you 500 bucks.

• 1:43:28John Coogan?

  Yeah, yeah, yeah.

• 1:43:29Jordi Hays?

  You could just find a template for like 20 bucks.

• 1:43:31John Coogan?

  But that's time and people don't want to profit themselves. Yeah.

• 1:43:34Speaker 06

  Yeah, I mean, that is, I'd say, what it looks like to find all these hyper niche markets and call them arbitrages and then capitalize on them, then go to the next one. And there are so many more than anybody can remotely imagine. I mean, I remember when, I guess eight, 10 years ago, I was making websites for people and doing that exact tactic. And now it's like, you have all the leverage in the world and it's basically limited to your creativity and grit.

• 1:43:58Jordi Hays?

  And now you can just go, you can find 10,000 small businesses in your state, let's say. Make them a brand new website, show them the website and say, do you want this? I'll give it to you for 200 bucks. And I think a lot of them would be like, looks good. I'll, I'll send you 200 bucks. Even though you just ripped it with like Kodex or whatever agent.

• 1:44:17Speaker 06

  Totally, totally, totally, totally.

• 1:44:19John Coogan?

  Talk about ads, WAP ads. What is the shape of that product? How does it fit into everything else?

• 1:44:24Speaker 06

  Yeah, I don't know if you guys have ever ran meta ads before, but it's a pain in the ass. And it's a, it's a very difficult to go on and navigate simply the UX of that platform. And that's coming from, like, for us, we grew up running meta ads to Shopify stores. That's all we did. And when we look at our platform and our merchant base and what people want to accomplish on it and how we believe that the more vertically integrated it is, the easier it's going to be for agents and for users to use it. The next obvious jump was to say, okay, people are earning, I mean, now 400, $500 million a month on the platform. And almost all that money is spent on ads. And because of that, why don't we let people programmatically run ads immediately after getting the payment?

• 1:45:08Speaker 06

  You don't have to wait any days for it to settle. You get all the, all the data and what's working can iterate on the fly. And it's not just meta that you're running ads to, it's actually the whole internet. And that is the ads product that we have available and it's pretty cool. People like it. And I mean, that's a very, very fast growing product.

• 1:45:26John Coogan?

  Take us through your reactions to all the trend pieces about clipping this year.

• 1:45:32Jordi Hays?

  Better late than never.

• 1:45:35Speaker 06

  Yeah.

• 1:45:36John Coogan?

  When, so what I'm referring to is like, there's been a number of trend pieces, sort of like breaking down the clipping economy, heavily driven by some of the kick live streamers, like the clavicular, among others, that sort of crossed the chasm and got profiled in the New York Times. And so there was, there were knock on pieces about this idea that you create a lot of content, like we do on a three hour show, we clip it. Or you do an eight hour, 12 hour livestream, you clip it. And your business has been very integral to that boom. But when did that start for you? Like, when did you realize the power of clipping? Like, how has that evolved?

• 1:46:08Speaker 06

  Yeah, I, I think people overestimate how intentional we are about some of these markets that have come up. And I think it more happens to us because we have such a good API. And that's, and it's just a platform. And people come up with all these crazy business models, they explode, people exploit them. And then it becomes so saturated that it's actually not even that cool anymore. And I think what's, what's happening with clipping is it is still a very, very, very powerful instrument. Because of how much money is going into it, because of how inherently like so much value can be gained by brands and companies, et cetera. You're going to have a lot of bad actors and people trying to exploit different people and all sorts of different bad stuff. And I think that's where a lot of the, what people are potentially saying on the pessimistic side of clipping.

• 1:46:50Speaker 06

  On the optimistic side of clipping, we look at it as yet another way to earn income on the internet for a huge amount of people. And especially if they are not sophisticated enough to potentially start a business yet, they actually start with clipping. And that's a very great way to learn how to make content, learn how to help other businesses create real value. And all the payments infrastructure, it scales super well so that people can actually earn a sustainable income by doing something like clipping. That can be extrapolated to data labeling, can be extrapolated to tennis coaching, can be extrapolated to all sorts of things that we're starting to see on our platform, other platforms integrate and pay out via our rails, which is simply creating more ways like clipping to earn money while still hopefully being value accretive to businesses. So that's what I would, that's what I would glean from clipping.

• 1:47:35John Coogan?

  Have you talked to any legacy media organizations about clipping? I'm thinking of like Fox News produces so much content, local news produces a lot of content, ABC, NBC, CBS. Like there are basically content farms that are effectively live streaming. It's a very different motion for these organizations. Would you recommend they get into clipping?

• 1:48:00Speaker 06

  Yeah. I mean, our focus is trying to build the infrastructure and the platform.

• 1:48:04John Coogan?

  And then whatever happens, happens.

• 1:48:05Speaker 06

  Yeah, whatever happens, happens. And I think as long as it's, it's, it's by the terms of safe. And I think in the context of a local news station, they're very under-resourced typically.

• 1:48:14John Coogan?

  Sure.

• 1:48:14Speaker 06

  And if we can make it so easy where they actually can, a couple clicks or even one click or even one prompt, spawn a bunch of clippers to amplify their media, that's great. At the stance today, it's a little bit too difficult. And I think that's where you have agencies fill in the gap and create these, fill these arbitrage opportunities.

• 1:48:31John Coogan?

  Sure, sure.

• 1:48:33Jordi Hays?

  How would you, how would you rate sentiment among WAP users? Is there, because WAP users are not necessarily reflective of like all of like the next generation of entrepreneurs and people that are starting careers. It's certainly selecting for people that are, have higher agency, they're trying to figure out how to make a living online or just make, as you say, make cool stuff with their friends. But is there a feeling that there's a ton of, a ton of opportunity? And that now is like an amazing time to be like coming online? Or is there at all the same kind of like vibe session that you see among people? Maybe college students that are trying to find jobs and feeling like.

• 1:49:15John Coogan?

  Vibe session? Oh, like the vibe recession?

• 1:49:18Jordi Hays?

  Yeah.

• 1:49:19John Coogan?

  Oh, yeah, okay. I thought you were mashing up vibe and obsession. You're obsessed with vibe.

• 1:49:26Speaker 06

  I think that the sentiment is overwhelmingly positive, like beyond optimistic. And I've, I've actually never seen it inside, to this level. I think where you look at a lot of the people that call themselves entrepreneurs, people that build, are trying to build a business. WAP users are unique because likely they're going to be earning money. And that's very different than trying to launch a vibe could it app and praying for users. So I think that what we see is that when, when we talk to our users and businesses on the platform, either at in-person events or VR chat on the platform, they are so excited about building their thing. And they're actually equally as excited about experimenting with other businesses, like we were talking about earlier. Because it feels like the, the possibilities are completely in your control.

• 1:50:11Speaker 06

  You know, you have so much opportunity right now. There's so many micro markets that can be tapped into and exploited arbitrage wise. And I think the young kids realize that and they're going crazy right now. I don't think there's an apprehension, at least in our user base, as to what they're going to do post AI. I think that that's a very exciting thing for them and they feel like they're grabbing by the horns and taking control of their destiny, which is exactly what's going to happen.

• 1:50:36John Coogan?

  What's the state of WAP enabling sort of human in the loop? AI companies. I'm thinking about your partnership with Raplet, Poké, Cal.com. It feels like there's a potential to launch something that the agents aren't quite there, or it has to interface with the real world in some way. But if you can bring some extra humans to bear in a particular workflow, especially for consumer, there's like an opportunity to build businesses there.

• 1:51:05Speaker 06

  Totally. I think one of the largest markets that is being talked about, but perhaps not enough, is just the demand for data right now is so crazy. And when you look at especially developing countries, one of the most lucrative pieces, ways to earn money on the internet is by submitting data and by recording themselves to do day-to-day tasks. And I think if you look at the broad base of human in the loop applications, especially around money, of course, you can start a business, you can sell your time on Cal.com, you can build a really cool website on Raplet and build a business. But if you want to think in the clipping construct, and perhaps you can think of clipping as act one of this, there is

• 1:51:46Speaker 06

  a lot of things people can do to that AI cannot. And that largely pertains to data. I mean, there's a huge crisis right now, I think, where people are realizing that the AI doesn't actually have the level of original thought that is needed to lift anything off the ground. And what are they doing? They're spending billions of dollars to get people's ideas. And that is not, I mean, in some way, that does economically get to the person. But I think we can do it even better. And the human in the loop we view is actually the most critical piece of any business and any real economic output, because it does start with someone's idea and creative ingenuity than versus an AI. I mean, well, let's build a business that does haircuts for tech people. That's not necessarily, I don't think, going to happen anytime soon. Maybe it does now because it's already out in the

• 1:52:30Speaker 06

  ether, but yeah.

• 1:52:32John Coogan?

  Last question. How's the business growing in 2026? What's the financial plan? Do you want to raise more money? Do you want to raise a bunch of money? IPO the company?

• 1:52:42Speaker 06

  Well, I think we want to deliver on our mission. And I think it's the most confidence we've ever had that we actually can. And I would say there's going to certainly, it's going to require investment. And there's clear prospects. We're exploding internationally right now with very little real motion that we've established intentionally internationally. And we're under invested across the board. We have a very lean team still. The growth has been really record breaking. I posted a tweet last week, we're underwater right now. It's really crazy. I mean, I, we can't go five minutes without something crazy happening in a good way or bad way. And I think it's part of building, building a business at

• 1:53:27Speaker 06

  our scale. So growth is phenomenal. I mean, I don't really know if I can talk about a lot publicly, but

• 1:53:33John Coogan?

  You can. You can say whatever you want. You can give us all the numbers.

• 1:53:35Speaker 06

  Yeah, yeah, yeah. We're accelerating growth at a pretty massive

• 1:53:42John Coogan?

  Just between.

• 1:53:42Speaker 06

  Massive scale. Yeah. I mean, if we're doing $450 million a month in earnings, and I mean, a lot of our take rates are public, you can do the math. It's getting, it's getting a lot more serious. And we take that response, we don't take that responsibility lightly.

• 1:53:56John Coogan?

  That's amazing. Well, congratulations on the progress. Thank you so much for coming on and breaking it down for us. We will talk to you later. But for now, we will bring in Katie Roof. She is the editor of Business Insider. We're very excited to have her joining the show. It's time to bust down the paywall. Jordy, you want to do the honors?

• 1:54:15Jordi Hays?

  That's right.

• 1:54:15John Coogan?

  We got to bust down the paywall because we have Katie Roof here. We have a physical paywall here. I'll bust it down.

• 1:54:21Jordi Hays?

  Do it, John.

• 1:54:26John Coogan?

  There we go. You know her from her scoops, many paywall busting.

• 1:54:31Jordi Hays?

  We built a real paywall here in the UltraDome for you.

• 1:54:35John Coogan?

  Yes, for busting down. Well, welcome to the show. How is life? How is the new gig?

• 1:54:41Speaker 07

  Well, good to be here. I just started the new gig yesterday. So so far, so good. I got through a new hire orientation. Okay. And ready to get scooping.

• 1:54:50John Coogan?

  Yes, of course. We won't ask you how you get your scoops. We all know. Signal DMs probably. But what is the shape of Business Insider these days? How do you fit into the organization? And then I want to talk about where Business Insider is going editorially.

• 1:55:07Speaker 07

  Sure. So I know Jamie Heller from when we were both at the Wall Street Journal. She oversaw all business and technology coverage there. And she's been brought in to be the editor in chief of Business Insider, where she's changing the direction towards more scoops and original content. That's partly why I fit in, you know, stuff people would actually pay for. And so, yeah, so I'm part of that new direction, that new chapter for Business Insider. And I'm also part of a new program for the parent company, Axel Springer. I'm in the Global Reporters Network, which is a network where I team up with Politico and our other sister publications. We just acquired The Telegraph in the UK.

• 1:55:50Speaker 07

  We own a lot of stuff in Europe. So, you know, whatever, whatever they acquire next, my stuff will appear in those news outlets as well.

• 1:55:59Jordi Hays?

  Take us into, into a scoop. I want to know, I want to know how often you're working on a story and there's other reporters chomping at the scoop. What is that? What is that process like? How much time do you have for a lot of these stories? With how quickly AI is moving, I can imagine you catch a whiff of a story, you're chasing it down. Sometimes, hopefully, most of the time you get to it first, but then other times, it's a, it's a dog eat dog world. It's a dog eat scoop world out here.

• 1:56:33Speaker 07

  Right. It's true. It's gotten a lot more competitive, you know, these days. I feel like back in like 2020, 2021, I could get most of the scoops and I still get a lot of them. But there's a lot of reporters now doing what I do. And, you know, being first is harder. But I think that the key is to not just go after things that are rumors that are widely circulating, because everyone can hear about that. Some of my biggest scoops have actually been predicting what happens next. And I will, I'll just ask around about my theories, like with this company, buy this company. I don't call people up and say, I heard this, if I didn't hear this. But if I'm having an extended conversation with them, I just throw out a lot of scenarios. And then sometimes we're like, you're right,

• 1:57:17Speaker 07

  this company is buying this company, or this company is going public, or they're, they're raising, you know?

• 1:57:22John Coogan?

  Yeah. Yeah, that makes a lot of sense. Can you talk to me about, in regards to the paywall, the business of media these days? How is the, you know, original reporting, scoop-driven journalism versus opinion versus news aggregation actually changing? And are we firmly in the AI is affecting the business? Or are we still just seeing knock-on effects from social media and just a screenshot of something can change the business model?

• 1:57:52Speaker 07

  Well, I think original reporting matters more than ever, because regardless, you know, technology can change and the format in which we tell our stories can change. But people are always going to want to find out what's going on in the world. And I think, you know, the reporters like myself, who've been fortunate to make the decision to double down on human skills instead of just writing skills, we have, you know, we still have value because I do things that maybe AI is not doing by having a network of people asking questions that they weren't planning to share and informing the public of that.

• 1:58:26John Coogan?

  Do you think any tech CEOs or people with potential scoops would ever talk to an AI reporter who's digging for a scoop?

• 1:58:35Speaker 07

  Well, I mean, yes, if it's something they really want out there. But the reality is, you know, people think that most of these stories are things people wanted out there. It's usually they were kind of neutral. Like, and usually people weren't like trying to leak something, but like reporters were asking, they're like, oh, yeah, you're right. Like, that's usually how it goes. And so, you know, AI, you know, unless they, you know, proactively want to plant something, which would be almost more like PR, what PR does, a PR pitch is, then, yeah, I think it's, it's not the same.

• 1:59:08Jordi Hays?

  How do you clock when a story's been planted? There was, there was a story about Colossus Biosciences raising at between 20 and 30 billion dollars. And to me, that

• 1:59:23John Coogan?

  Might be true.

• 1:59:24Jordi Hays?

  That just screams like they planted a story because I don't

• 1:59:30Jordi Hays?

  I'm not, I'm just gonna say it. I don't know that many institutional investors that are sort of clamoring to invest in Colossus Biosciences. And it's a way, my theory is that it's a way to signal to potential retail investors that we're open for business.

• 1:59:44John Coogan?

  Yeah, this, this round's getting hot.

• 1:59:45Speaker 07

  This is something I think about all the time. I mean, I take accuracy super seriously. And, you know, as much pressure as, as there is to be first to the news, I think it's much easier to destroy your credibility than it is to build it. And so I always try to think, does this make sense? Do they have an agenda here, like, to be misleading or dishonest? And, you know, I used to say to some people, sometimes reporters, past jobs might hear about something and they would be like, company X wants to be worth 10 billion. And I would say, well, I also want to be worth 10 billion. You know, can they, can they get the 10 billion? I think that's the real question. And so I think that you have to, obviously, people have incentives to use us to manipulate public opinion. We have to be savvy about that.

• 2:00:27John Coogan?

  Do you think with how dominant tech is generally now, it feels like it's a bigger story. We see it, you know, tech has moved from the business and finance section of the Wall Street Journal, the front page, more and more, not every day, but, you know, just today, Chinese AI models raise alarms on the front page. It's international news. Is that, is, do you see that as driving Business Insider's TAM essentially? Like, is the TAM for technology scoops and in, and private markets news going even bigger now?

• 2:01:02Speaker 07

  Yeah, you know, and I think that's absolutely true. I think there's a lot of curiosity out there about AI and the money behind it and, and how it's going to change things and transform the world. And so, yeah, I think that's part of why, you know, there, there's so many news outlets have been doubling down on getting more venture capital and AI reporters, because I think that there's, there's broad appeal, even if you're not an investor that's standing to make money off of this AI boom, you're curious to see where it's headed.

• 2:01:32John Coogan?

  Yeah. And then, last question for me. I'm interested, I mean, we love Business Insider. We love business. We consider ourselves a bit of insiders ourselves, sometimes. But I'm wondering where you want the, the brand of Business Insider to go, and where you see it in a few years after, you know, you've been on the job for a while?

• 2:01:52Speaker 07

  Well, from what I understand is, you know, Jamie, you know, I'm not running Business Insider, I have a fancy title, but Jamie's, Jamie is running this and she's got, you know, she's really made a big difference already in bringing, bringing out.

• 2:02:08John Coogan?

  To us, you're the CEO of Axel Springer now, okay? Doffner, you're out, Katie Roos in. She's got the scoops that we know and love. And so, sorry.

• 2:02:20Speaker 07

  So, you know, she's already played a major role as our editor in chief in, in bringing, they, they've doubled their exclusive content. I think it used to be 40%, now it's 80%. And so I think that, you know, I'm part of that strategy where they want to just build upon on that.

• 2:02:39John Coogan?

  Fantastic. Well, congratulations.

• 2:02:41Jordi Hays?

  Congrats on the new role. And thank you for, for all of your work over the last couple of years that has contributed to the show.

• 2:02:48John Coogan?

  It's a lot to talk about. We couldn't do the show without you. So, thank you.

• 2:02:51Speaker 07

  Thank you so much. I really appreciate the shout outs.

• 2:02:53John Coogan?

  Of course.

• 2:02:54Jordi Hays?

  Cheers, Katie.

• 2:02:55John Coogan?

  We'll talk to you soon. Let me tell you about public.com investing for those who take it seriously. Stocks, options, bonds, crypto, treasuries, and more, with great customer service. You know who's not public, but you can still read the financials of, is the German nightclub, Burgheim. Is that how you pronounce it? Bergen? Burgheim?

• 2:03:16Jordi Hays?

  Burgheim.

• 2:03:17John Coogan?

  Burgheim?

• 2:03:18Jordi Hays?

  Burgheim. I always sort of mumble through it.

• 2:03:19John Coogan?

  Yeah. They, maybe they should have the Axel Springer Corporate Retreat there. That would be a good option. Ar Karasian sharing this, yeah, it's in the Financial Times.

• 2:03:29Jordi Hays?

  Read through it.

• 2:03:30John Coogan?

  Okay, so, basically, Ar Karasian, the economist, lead economist at Ramp Economics Lab over at Ramp, says, "Today I learned German companies have to publish financials even when privately held." We can talk about like, how much of a nightmare that is, but this club, Burgheim, Bergen, Bergen?

• 2:03:51Jordi Hays?

  Burgheim.

• 2:03:52John Coogan?

  I'm all over the place with this pronunciation. Anyway, 1.4 million dollars or euros in net profit in 2024, 414,000 in annual rent, 355 employees, you can just go look it up.

• 2:04:05Jordi Hays?

  14,000?

• 2:04:06John Coogan?

  What? 14, 414,000 euros in annual rent.

• 2:04:13Jordi Hays?

  Okay, that's more like it. Cause I've been, I've, I've only walked by it, but it is a massive building. And I thought you said 14.

• 2:04:21John Coogan?

  And the Financial Times has a whole deep dive into the nightclub. But,

• 2:04:25Jordi Hays?

  Yeah, so, so let's talk about the implications.

• 2:04:28John Coogan?

  Yeah.

• 2:04:29Jordi Hays?

  Let's talk about the implications of small business revenue.

• 2:04:32John Coogan?

  Yeah.

• 2:04:33Jordi Hays?

  Being public.

• 2:04:33John Coogan?

  Yeah.

• 2:04:34Jordi Hays?

  One, terrible for Course Bros. That's why they have to go to Dubai, because they can't LARP.

• 2:04:38John Coogan?

  Yeah.

• 2:04:38Jordi Hays?

  You know, if you're LARPing around in London.

• 2:04:40John Coogan?

  Yeah. And you're saying, oh, I make so much money in real estate. I remember there was a YouTuber who did, and he was above board. He actually did a tell all on CNBC, How I Make Money, Millennial Money, some, some segment they did on him. And, and he's like, I'm, I'm, I'm a real estate guy and I make 10 million dollars. And he broke it down and he was like, I made 300,000 dollars from real estate and 9,700,000 dollars from YouTube. And it was because he was making so much money with this great media business that he had, that he actually was. And he had good advice about real estate, but he wasn't running a real, real estate firm. He was, you know, a real estate associate who created a fantastic YouTube channel that was equally impressive, or maybe more impressive.

• 2:05:24John Coogan?

  But as we were talking to Stephen about, you know, like, how do you know what's working? Well, apparently in Europe, you can just look up the financials of every company and know, oh, well, they have high margins. I should just copy them. Right?

• 2:05:36Jordi Hays?

  Basically, yeah, I looked at investing in a company in the UK. And, yeah, you could, I, I got the financials, but then they were like, yeah, you can just look this up and, and confirm, confirm it with, you can do basically like a records request.

• 2:05:50John Coogan?

  Yeah.

• 2:05:50Jordi Hays?

  But yeah, the, the, it'd be, it'd be very interesting if we had anything like that with startups, right? Because every time there was a big funding round, people would be like, how, how does this make sense? How does this make sense? So?

• 2:06:03John Coogan?

  Although it does seem like it's, it's on some sort of delay. It's only annual reporting and.

• 2:06:09Jordi Hays?

  I know, but still, imagine when that reporting came, comes out and they're like, wow, this $10 billion company only did $10 million last year, which would be happening.

• 2:06:18John Coogan?

  For some of our private markets unicorns, that would be a huge deal to dig into the numbers. Although, you know, even, even the, even the massively successful venture backed companies have complicated financials, the disclosures would be.

• 2:06:30Jordi Hays?

  I just think it's, I just think it's crazy that Burgheim has this like, you know, cultural institution is only putting up 1.4 million euros in net profit.

• 2:06:42John Coogan?

  Well, Sela underscore has a take, says, "Companies like, like this club don't really exist to deliver a financial profit. They do absolutely drive social capital to those involved in ownership. So perhaps you are owning a stake in this, in this institution to meet people, do business deals at the club, meet other."

• 2:07:02Jordi Hays?

  Sam says, "We need to LBO and franchise ASAP."

• 2:07:05John Coogan?

  That's a good idea. Anyway, IMAX is in trouble loosely. The 70 millimeter IMAX that has been running 24/7 at the Irvine Spectrum for the Odyssey, overheated today. Bill Hunt shares some extra news, says, "The scary thing here is that IMAX can't build any more new projectors." This was reported earlier. They apparently don't have a complete set of the engineering blueprints. Most of the engineers who designed them have retired or passed away and the parts, supply chains have long since dried up. That seems like a bigger problem than the blueprints. You gotta be able to one-shot a bunch of IMAX blueprints.

• 2:07:48Jordi Hays?

  Can you just like, take it apart?

• 2:07:49John Coogan?

  That's a good, that's a good point. Yeah. You should just be able to take it apart, take a picture of every part, and then figure out how it works.

• 2:07:57Jordi Hays?

  Codex.

• 2:07:58John Coogan?

  Codex. Fire it up. So the goal for the foreseeable future is to upgrade and keep all of the existing projectors running for as long as they can. This is the true reindustrialization project. We were wondering, like, what's the next Andorol? It's the next IMAX. That's what we're looking for. Somebody cranking out American-made 70 millimeter IMAX projectors. That's the real goal. Big news out of Google. Logan Kilpatrick, friend of the show, says, "Say hello to Gemini 3.6 Flash." We talked about this a little bit, but there's some benchmarks here. We love benchmarks. "Designed to be higher intelligence, more token efficient, and with a new lower price based directly on developer feedback, 3.6 Flash continues

• 2:08:40John Coogan?

  our progress towards models that are deeply usable in real world scenarios." Congrats to the whole DeepMind team over there. They say this model is much more efficient and spends, spends a lot less tokens to deliver better performance. And also, the big news, he said, "We have started our most ambitious pre-training run yet for Gemini 4 and are excited by the progress." I think that there's a lot of, is Tipo trolling him with hope it finishes one day too? Wow, that's a spicy post. But, I mean, the, the last pre-train that came out of Google was interesting. It had a different flavor to it. And they, they did the initial responses. They were a little more terse, a little tighter. I,

• 2:09:22John Coogan?

  I enjoyed poking around with Gemini. I thought it was fun. We're counting on you, Logan. Good luck.

• 2:09:28Jordi Hays?

  Before our next guest, we have a post from Sheil Monat.

• 2:09:30John Coogan?

  What'd he say?

• 2:09:31Jordi Hays?

  He says, "Very cool idea. Vacation with an artist. Travel the world and learn new skills like ceramics, street art, bookbinding via a mini apprenticeship, three to 10 days with master artisans. In many cases, you stay with them too. This got me thinking, what if you could vacation with someone that was one-shot by AI?"

• 2:09:52John Coogan?

  That sounds terrible. I would like to vacation with a capital allocator at the Yellowstone Club and the Amon. Do a tour of the Amon. You can do this, but not on a website. You have to know them personally, I think.

• 2:10:03Jordi Hays?

  But.

• 2:10:04John Coogan?

  But I, I'm surprised this isn't an Airbnb.

• 2:10:06Jordi Hays?

  It sounds, this idea sounds crazy, vacation with a capital allocator, but there's probably a price, right? It just might be, it might just be egregious, right?

• 2:10:16John Coogan?

  Maybe 20% of equity in your company. I, I'm interested that this is its own website, Vawa, Vacation with an Artist. It feels like it's directly in line with the Airbnb Everything app roadmap. The idea was that you would be able to go. Anyway, we have our next guest in the waiting room. Let's bring in Zavain Dar for Dimension. He's the founder. Welcome to the show.

• 2:10:38Jordi Hays?

  Here he is. How are you guys? How are you? What's going on?

• 2:10:41John Coogan?

  Give us the news. We gotta hit this gong.

• 2:10:42Jordi Hays?

  The newest size lord.

• 2:10:43John Coogan?

  The newest size lord of capital allocator.

• 2:10:45Jordi Hays?

  Boom. Oh, yeah. He just said it himself. That was, that was good, good alignment.

• 2:10:53Jordi Hays?

  Great stuff.

• 2:10:54John Coogan?

  How much did you raise? We didn't even get the number.

• 2:10:57Speaker 08

  Uh, eight, eight hundred million.

• 2:10:59John Coogan?

  Eight hundred million.

• 2:11:01Jordi Hays?

  I'm sorry that you couldn't, you know, pull together the last two hundred there.

• 2:11:06John Coogan?

  Two hundred million short, maybe. Who's counting?

• 2:11:10Jordi Hays?

  Close enough, close enough.

• 2:11:11Speaker 08

  Dimension three.

• 2:11:12John Coogan?

  They're over a billion six in assets, so.

• 2:11:15Speaker 08

  That's right.

• 2:11:16Jordi Hays?

  It's a good start. It's a good start.

• 2:11:18Speaker 08

  Dimension three, eight hundred million, um, add our legal hard cap. So I think we went out for seven hundred or thereabouts.

• 2:11:24John Coogan?

  Okay.

• 2:11:24Speaker 08

  Legally, we can't raise more than, than a, uh.

• 2:11:27John Coogan?

  They'll put me in jail by raise anymore.

• 2:11:29Jordi Hays?

  We all know there was, we all know the demand was there. We all know the demand was there. Um, yeah, talk about fund one and two, since it's your first time on the show, what, what got you to this, you know, monumental fund?

• 2:11:42Speaker 08

  Yeah, uh, on one, three fifty, that was a twenty twenty two vintage. On two was five hundred. That's a twenty twenty five, uh, vintage, uh, just about twelve months ago. Uh, we started the firm, my co-founders, Adam, Nan, and I would spend the last decade investing across the union of life sciences and technology. Uh, fund one was very much so at the intersection, uh, so, so companies that were equal parts tech, equal parts life sciences. Uh, fund two, we started to expand, uh, more so the union. Fund three, uh, it really is the frontiers of science and compute. So companies that are touching silicon, next gen, uh, GPUs, CPUs for ML and AI architectures, all the way through ML infrastructure.

• 2:12:23Speaker 08

  And then on the science side, uh, world models, Neo Labs, uh, you know, really kind of pioneering both physics, but also biotech and next gen medicines as well.

• 2:12:32John Coogan?

  Do you think we'll see, uh, a coalescing of business models in the next generation of tech-enabled bio companies, biotech companies? Because we're, there, there's an opportunity to be sort of really full stack, train a model, use it to develop a drug, take that drug all the way through the FDA approval process, use AI to write the applications and go back and forth and then own the intellectual property all the way. That feels like a lot of different capex muscles flexing at the same time, but maybe that is the future. How do you see it actually playing out? What's the, what's the common pattern?

• 2:13:10Speaker 08

  You know, there's a, my, my co-founder, Adam is Australian and he's a, he has a want of saying, uh, horses for courses, which for, uh, I think the North American audience here, it means to each their own, more or less. So we have.

• 2:13:22Jordi Hays?

  We're gonna say using that for our North American audience, horses for courses.

• 2:13:27Speaker 08

  Big in, uh, big in Japan, uh, or, uh, for example, chai, uh, which is, I think you maybe had Josh or Jack on the show in, in the past. They now, uh, we see the round that we helped to co-lead with Index and Sequoia and Kleiner last week. They are very much so doing the latter, which you described, selling their services as a SaaS product, uh, into pharma. On the other hand, we have companies like New Limit, uh, that are, uh, developing similar looks of technology, but doing so with the express intent of developing their medicines end to end and one day actually commercializing medicines that, uh, affect aging and longevity.

• 2:14:02John Coogan?

  Are aging longevity the, the, the, the hot topics because they're so universal? Or do you think you'll see, uh, more of the, I don't know if I'd call it the traditional biotech playbook, but there's often this, you know, there's a whole pipeline of biotech companies that are targeting like, there's five thousand people that have this rare disease and it still turns into a billion dollar acquisition. And it's this odd pattern that doesn't really ever make it to the front page of Time Magazine, but obviously has an impact both financially and medically on those people that were suffering from that disease.

• 2:14:39Speaker 08

  I think, I think both, both extremes are true. Earlier this year, RevMed, uh, had a, had a very stunning phase three result for their lead drug, affecting patients with pancreatic cancer for, for the rest of humanity, for a thousand years from now, two thousand years from now, if you have pancreatic cancer, you should have a somewhat effective treatment. And that's really based on a biotech based in California that in the last six months developed and kind of showed that clinical data, and that's stunning. Of course, pancreatic cancer, that's not as, uh, uh, prevalent as aging, which everybody has, or maybe obesity or something. At the same time, we are, I think, witnessing a revolution of what it means, or a re-underwriting of what it means to be diseased.

• 2:15:21Speaker 08

  And even something like obesity, or maybe ten years ago or fifteen years ago, pharma and biotech, frankly, they didn't invest in these areas because they didn't consider it a, a disease. They considered it a behavioral problem.

• 2:15:30John Coogan?

  Sure.

• 2:15:31Speaker 08

  Today, it's considered a disease and it's the largest drug on the planet. You're seeing it in, in areas like aging and longevity, inflammation, immunology, depicts and if anyone has atopic derm or eczema, it's one of the largest drugs on the planet today. Twenty years ago, no one would touch that because diseases that were skin related weren't considered serious, uh, enough. So we are starting to see, I think, a, a redefinition of the types of areas where biotech and pharma can actually play.

• 2:15:55Jordi Hays?

  I'm sure you got asked this, uh, you know, during the fundraising process, but what's your overall worldview on investment opportunities around peptides as a category? Uh, you know, basically drugs that, that people are taking somewhat recreationally now, but have a bunch of different benefits that have, uh, that are in a, you know, sort of continuous gray area. Uh, but what's your, what's your outlook on, on the category? Because there's billions of dollars of revenue there. There's some really interesting, uh, uh, exciting, at least indicators that, that they can have great impacts, but what's your view?

• 2:16:36Speaker 08

  I take the red and the yellow shots on Monday and Tuesdays and the green and the blue shots on Fridays and Saturdays and my wife doesn't, I'm kidding.

• 2:16:44Speaker 08

  I, I would not recommend this stuff to anybody. Look, we, there is a history of peptides and hormone memetics as drugs, GLP ones, GLP ones are in some sense, uh, uh, those exactly. Whenever you're sticking anything into yourself, you, you want to actually know what it is. You want to know, make sure that there's no impurities in it. Uh, we don't understand the biology, the mechanisms, uh, in many of these cases. And so, um, I think even the scuttlebutt that you guys and I am probably hearing about the efficacy or effectiveness of, you know, the SF tech community or the New York, uh, uh, kind of, you know, uh, tech community taking these things. Um, my suspicion is that's probably more placebo, uh, than not. I'd be very careful about doing any of this.

• 2:17:27Speaker 08

  I certainly wouldn't myself do it, nor would I let my friends and family kind of do it.

• 2:17:32John Coogan?

  How do you think AI affects, uh, sort of like, I don't know if it's called like repurposing drugs, but, uh, the big GLP one breakthrough for obesity, it was originally a diabetes drug. And there's been a few examples of drugs in history, many examples actually, where it started as a heart medication and then became erectile dysfunction drug. And it feels like in an age of AI, even if you don't get the super intelligence that can just imagine the cure for cancer, you at the very least could potentially test every drug against every indication, maybe more efficiently. Uh, what, what, what does sort of like, uh, cross application of, uh, biotechnology look like in the future?

• 2:18:14Speaker 08

  I, I, I think, uh, two things are true with ML and AI. We are better able to understand the root cause of disease, mechanism, pathway, um, and kind of the, the industry nomenclature. Uh, and with a better understanding of mechanisms and pathways, we can repurpose molecules, whether they're biologics or peptides or small molecules, uh, against those where we know that they are known to be effective. Uh, the other, which is simultaneously true, historically, we have, um, uh, the vast majority of known targets for, uh, disease biology have been quote unquote, undruggable. And so it's not a question of taking a shelved acid from Pfizer or Novartis or Lilly. It's a, it's a question of, we just don't know how to design the molecules to actually perturb, uh, those proteins intracellularly or extracellularly yet.

• 2:18:59John Coogan?

  Sure.

• 2:19:01Speaker 08

  My suspicion is in the next five to six to seven years with the companies in the, in the modes of the chai's of the world, for example, we will have technologies to perturb what we want to perturb. And so we'll both be able to repurpose when there is a shelved acid against kind of our new knowledge of biology, but then also leverage generative AI and ML to create molecules to perturb biology where maybe the shelved acids don't quite yet exist.

• 2:19:26Jordi Hays?

  What, uh, letter are you most proud of and why?

• 2:19:30Speaker 08

  Z, it's a good letter.

• 2:19:33Jordi Hays?

  No, no, I'm talking about your letters.

• 2:19:35Speaker 08

  I'm kidding, I'm kidding. Uh.

• 2:19:38Jordi Hays?

  Z, underrated letter.

• 2:19:41Speaker 08

  In terms of letters that we have published from Dimension?

• 2:19:45Jordi Hays?

  Yes, you published some beautiful letters, but maybe it's an idea in a letter the chat was asking.

• 2:19:50Speaker 08

  Yeah, the what if I write letter, that was actually, you know, first written as a letter confidentially to our partners and LPs in Q1 of this year as part of our annual 2025 recap and we anonymized part of it, we took out some parts of obviously the financial information and decided to share it with the broader kind of entrepreneurial tech and science audience. I think it resonated with people, I think especially in this moment in time where there is so much tension geopolitically and technologically and from a class and labor perspective, so many things are happening and there's a lot of tension. And to maybe take a step back and say, hey, what's the good that's happening if we're right in developing these technologies and sciences? How does that bend the arc of humanity and society for the better?

• 2:20:36Speaker 08

  That was fun to write. I think it got a groove with a good audience and so we're pretty proud of that. I think more people can be espousing and writing, you know, that that sort of stuff.

• 2:20:45John Coogan?

  Last question, how many cups of coffee a day do you drink? There's new reporting that says a five is good for you. Fifteen, really?

• 2:20:52Speaker 08

  I'm kidding.

• 2:20:52John Coogan?

  Are you a coffee maxer?

• 2:20:53Speaker 08

  I tried to limit it. I have my fridge cigarette.

• 2:20:56John Coogan?

  There we go. Cheers.

• 2:20:58Speaker 08

  I cheers, man. Yeah, I try to limit it to probably two or three. If I do have a cup of coffee after four, I'm probably wired until two AM.

• 2:21:07John Coogan?

  Yeah, so well within the healthy limits. Healthy guy, working on health and AI. Well, congratulations on the fun. Thank you so much for coming.

• 2:21:14Jordi Hays?

  Congrats to you and all your partners.

• 2:21:17John Coogan?

  Yeah, on an absolutely generational run over there.

• 2:21:21Jordi Hays?

  Looking forward to meeting more of your founders.

• 2:21:23John Coogan?

  Yeah, we'll talk to you soon. Have a good one. Let me tell you about Railway. Railway is the all in one intelligent cloud provider. Use your favorite agents to deploy web apps, servers, databases and more while Railway takes care of scaling, monitoring and security.

• 2:21:39Jordi Hays?

  Up next.

• 2:21:40John Coogan?

  Up next.

• 2:21:41Jordi Hays?

  We have Chad Edwards.

• 2:21:42John Coogan?

  We'll bring Chad in in just a second. Briefly, I'm going to tell you about this interesting screenshot from Reddit, an LLM stenography tool, steganography tool? How do you pronounce that? Kind of neat with how the EU is trying to gain access to all communications. So basically you use an LLM to transform your text messages, secret messages, they look normal, but in fact, there's a decoded message. So on the left, it says message to Bob, I got coffee downtown and it's actually pretty good. Thinking of what to make for dinner, want to come help me cook? Overdid it on the soup yesterday though, and that is actually secretly encoded to mean they caught Matthew last week because he spoke against them. Explain how this works, Tyler.

• 2:22:27Speaker 02

  Yes, so it's not the, the LLM is not actually doing the encrypting. Basically you encrypt it first using some like standard process and then you get like the output of that is like some cipher text.

• 2:22:36John Coogan?

  Like a lookup table basically or something.

• 2:22:38Speaker 02

  Uh, so basically you encrypt it, you get some like, something that looks like scrambled, like a scrambled string. And then you basically

• 2:22:45John Coogan?

  hydrate that.

• 2:22:46Speaker 02

  You have these bits and then you basically use the bits to determine which token you're going to use. In the LLM, you basically need to use an open source LLM.

• 2:22:54John Coogan?

  People are accusing Chad, John Exley in the chat have been doing this for months, sending coded messages to everyone. Well.

• 2:23:01Speaker 02

  It is very cool though.

• 2:23:01John Coogan?

  I thought this was a cool idea. I think it's a cool demo. I don't know that it's wildly useful, but for certain people that need to send secret messages back and forth, go ahead. Also, they're calling North Korea NOCO, like it's the cool trendy part of town. I thought that was a funny post. Anyway, we have Chad Edwards from Cusp AI in the waiting room. Let's bring in Chad Edwards, the co-founder and CEO. How are you doing, Chad? Welcome to the show.

• 2:23:29Speaker 09

  Thanks, I'm here. Yeah, doing very well.

• 2:23:31John Coogan?

  Give us the news. How are you doing? You raised some money? How much did you raise?

• 2:23:34Jordi Hays?

  Look at this background. Incredible.

• 2:23:36John Coogan?

  How much did you raise?

• 2:23:37Speaker 09

  That's the UK as a semiconductor chip. We raised $450 million.

• 2:23:46John Coogan?

  Anyone, anyone I've heard of invest?

• 2:23:51John Coogan?

  It's a murderer's row. You got Jeff Bezos, you got a bunch of other folks in.

• 2:23:56Speaker 09

  Yeah, Kleiner Perkins, Zenia.

• 2:23:58John Coogan?

  There you go. Congratulations. What are you building? Break down the business.

• 2:24:03Speaker 09

  Yeah, so at Cusp, we're building essentially a search engine for materials, so generative AI platform where you can discover entirely new materials. And of course, it's not something we think about in our day to day lives, but everything we hear and talk about day to day, such as the pursuit of intelligence or the energy transition or the climate crisis. If you boil all of these things down to the fundamentals, they're a material science problem. And for example, a semiconductor chip is around 60 different plus elements. It's 99.99 pure silicon. And so if we can come up with a better way to discover new materials, we can come up with better chips, we can improve the efficiency of solar cells. And we can also work on climate technologies to leave the world a better place. And so that's kind of the core focus for our company.

• 2:24:46John Coogan?

  Yeah.

• 2:24:46Jordi Hays?

  What's the most underrated new material?

• 2:24:50John Coogan?

  Probably room temperature superconductors, I would say. What do you think?

• 2:24:56Speaker 09

  Yeah, I mean, there's a few teams now pursuing room temperature superconductivity. It's kind of the holy grail of material science. There's still some pretty interesting physics to be figured out along the way, but if someone can crack that, then the implications are huge. So yeah, let's see.

• 2:25:08John Coogan?

  Is there a power law in applications of advanced material science broadly, like battery technology would be by and far the biggest market if you could unlock that? Or is it sort of distributed and there's so many applications, there's not necessarily one that you'll be focusing on in the short term?

• 2:25:28Speaker 09

  Yeah, I mean, the opportunity space is absolutely enormous. We could be sat here talking about the chip industry or the energy industry or, you know, climate. There's just so much opportunity out there. But I think what we've seen as a company is the semiconductor industry have basically pulled us by all four limbs in the direction of semiconductors. So we didn't set out to build the company as a semiconductor company. We've kind of built a platform that was horizontal and we felt the market pull in that direction. And again, it boils down to the very fact that with everything we're now seeing in AI, there's a real demand on the chips to be more performant, have higher energy efficiency. And all of that fundamentally boils down to better materials. So they've had to pick one, semis.

• 2:26:07John Coogan?

  Yeah. So I mean, obviously huge markets, semis, massive market, any application you have there will have huge demand. What is the capital intensity of the business? I mean, you raised $100 million Series A last year, now 450 million. Do you have compute costs, training costs? Is this just to hire the world's best material scientists? Is there a big data acquisition bill that's coming? What is the use of capital over the next two years look like?

• 2:26:38Speaker 09

  Yes, obviously we're nowhere near the kind of frontier model LLM types expenditure. We don't need to train huge models like that. We train more domain specific models. And as part of that, of course, our three big kind of cost centers would be people, so hiring the best people in AI and machine learning, which is what we've been able to do and retain those folks. And we've seen some of the salaries that go around the world for people in that category now. Computer is another one. So we have a very big partnership with Nvidia and they're part of a big announcement that we made yesterday. And then third and foremost is data generation in an experimental sense. So of course we have to ground all of our work in physical experiments. And so we have a network of labs globally now where we generate data for us to train the models.

• 2:27:21John Coogan?

  Would you vertically integrate there at some point to close the loop, build your own material science lab where you could prototype new materials and test them?

• 2:27:31Speaker 09

  Yeah, I'd say never say never, but at the moment, our thesis has been we can move much faster if we have a network of existing labs around the world. We can tap into them. We can get going very quickly. They have domain experts in those labs that know an awful lot more about the specific domain and we can't easily replicate that. So and a lot of our customers also have their own labs. So yeah, our model so far has been work with existing labs and customers that have labs and that allows them to move faster and us to move much faster. But who knows, maybe one day we say, hey, we're going to build a lab in a certain domain.

• 2:28:02Jordi Hays?

  How do you think about value capture? It's very easy for me to imagine like how you would create value for your customers, but if you help somebody discover a new material that the application of that material could, could be worth, you know, billions of dollars, how do you, how do you make sure that it's a fair trade?

• 2:28:26Speaker 09

  Yeah, so we've taken a very different approach to the business model. In fact, we're, I think, genuinely the first to have done this in the world. And when we started the company and we pitched this business model to investors, they said, Chad, forget about it. This is never going to work. You're never going to get big corporates paying you royalties on materials. And so for the first two years, I made it my mission to make sure that every customer contract that we have has royalties baked into it. So we've now proven the kind of biotech type model works now in material science. Companies are prepared to pay you upfront for the programs that you set up. And then they're prepared to bake you in a royalty at the end. So that as that material goes into production, you can kind of share the upside commercial potential of that material.

• 2:29:04Jordi Hays?

  Very, very cool. This is what I was asking the founder of Chai Discovery, who's doing AI for drug discovery. It feels very, right now, they just have a SaaS fee, I think, but it feels very natural for them to get some type of royalty. They help create a hit drug. It's a win-win, great customer alignment there. And it makes so much sense for your business. And you end up building basically a portfolio of bets over time. And even if you have a handful of big winners, it could, I can see how that would generate billions over time.

• 2:29:40Speaker 09

  Yeah, exactly. I kind of see my job a little bit analogous to a VC in a way that we have a portfolio of materials and some of our materials are nearer term. They have higher commercial potential and some of them are longer term frontier bets. And if we have a balanced portfolio, then hopefully our revenue projections and journey will follow a very steady trajectory. But I can also see merits of the approach that Chai are taking and having predictable monthly incomes and subscriptions to software is also carries your base revenue, whereas the program aspects can be a bit more lumpy. So I could see merits of both approaches.

• 2:30:16Jordi Hays?

  Yeah. So why not both?

• 2:30:17John Coogan?

  Yeah. Do you think that the next round KPI or key metric that you'll be underwriting the deal against will be revenue? Or are there more like scientific milestones, benchmarks, or sort of promising results where you'll be able to totally justify the next expansion pre-revenue? Or do you think that like the business will actually grow in the short term with the with actual revenue generating deals?

• 2:30:49Speaker 09

  Yeah, so we've tried to kind of go against the grain in that a lot of deep tech companies take forever to get to revenues. And so we've tried to be very commercial, very early on. Before this, I built a quantum computing company, which is kind of one of the most extremes versions of pre-revenue. And so, yeah, I've tried to be very, very commercial in this company from very early on. And everything we do is grounded with paying customers. But I think I've also given up predicting when the next fundraise will happen, because in every raise, I've said, we're not going to race for another six to 12 months. And then a few months later, we've been preempted and there's a RAMP coming together. So I don't know exactly what the next metrics looks like.

• 2:31:26John Coogan?

  Well, congratulations. I mean, I can't wait to talk to you in a couple of months when the next round happens. It'll be any day now, but you're always welcome.

• 2:31:36Jordi Hays?

  Very, very cool business and business model and looking forward to the next conversation.

• 2:31:40John Coogan?

  And what a great, what a great group of partners with all the companies that you've worked with. It makes so much sense. So good luck and congratulations. We'll talk to you soon. Have a great rest of your week.

• 2:31:49Jordi Hays?

  Cheers, Chad.

• 2:31:50Speaker 09

  You too.

• 2:31:50John Coogan?

  Goodbye. We have one last post I want to go through. Ramp launched a model router. Brexton loves it. He says Ramp launching a model router is god tier product expansion. The winds are blessing it. The market is exhausted with token maxing, proliferation of new models, sovereignty. This is the first time I've looked at a launch and went, wow, this might be the start of a new core product. Yeah, there's been a bunch of speculation about this, but it makes a lot of sense. Ramp's promise is to save you time and money. The CFOs are increasingly annoyed by token routing. We talked to Eric Lyman about this last week.

• 2:32:33John Coogan?

  Are you using the craziest frontier model, burning millions of tokens to answer the weather? Maybe that should have an expense report attached. And so, very, very exciting to see where this goes, how they roll it out. I know it's in alpha with a number of customers. And I believe that the product's actually available to non-RAMP customers as well. So you can use their product exclusively.

• 2:32:55Jordi Hays?

  You says going after everything time and money touches.

• 2:32:59John Coogan?

  I love it. I love it. Anyway, thank you for tuning in. We will see you tomorrow, Wednesday at 11am Pacific. Leave us five stars on Apple Podcasts and Spotify. Sign up for our newsletter at tbpn.com and

• 2:33:14Jordi Hays?

  We love you.

• 2:33:14John Coogan?

  We love you. Goodbye. Flashbang in the horse.