Apple vs OpenAI, Paramount Threatens to Leave CA, Mark Gurman Joins | Alexis Ohanian, Morgan Housel, Nico Christie & Michael Jarman

(00:39) - Apple vs OpenAI (25:24) - Paramount Threatens to Leave CA (42:48) - 𝕏 Timeline Reactions (45:39) - Alexis Ohanian, co-founder of Reddit and venture capitalist, discusses the enduring value of live events in the age of AI, emphasizing that human experiences like sports and theater remain irreplaceable. He highlights his investments in women's sports, such as Angel City FC, and the track and field league Athlos, aiming to modernize and elevate these domains. Ohanian also touches on the growth of sports betting, expressing concerns about its societal impact and the need for thoughtful regulation. (01:10:19) - Morgan Housel is a partner at The Collaborative Fund and the New York Times bestselling author of "The Psychology of Money," with his works translated into over 60 languages and selling over 12 million copies. In the conversation, Housel discusses the psychology behind the rise in sports betting, noting that when individuals perceive limited options in life, they become more risk-seeking, leading to increased gambling activities. He also highlights the impact of technological advancements, such as the accessibility of day trading platforms, which have made gambling more prevalent across generations. (01:47:34) - Mark Gurman, a renowned technology journalist specializing in Apple Inc., discusses the recent lawsuit Apple filed against OpenAI, alleging the theft of trade secrets and confidential information. He highlights that OpenAI has recruited over 400 former Apple employees, including key figures like Tang Tan, OpenAI's Chief Hardware Officer, who is accused of soliciting proprietary information during interviews and coaching departing Apple employees on evading security protocols. Gurman emphasizes the significant impact this legal battle could have on both companies, especially as OpenAI ventures into hardware development using alleged misappropriated Apple technologies. (02:12:25) - Nico Christie & Michael Jarman. Nico Christie, co-founder and chief product officer of Fundamental Research Labs, discusses the development of Shortcut, an AI-powered Excel agent designed to automate complex spreadsheet tasks for finance professionals. He highlights Shortcut's ability to build financial models in minutes, achieving over 90% formula accuracy through multi-agent verification, and its integration as a native Excel plugin that preserves existing macros and VBA code. Christie also emphasizes Shortcut's continuous improvement, noting a 20% performance gain since launch due to daily updates enhancing agentic performance, user experience, and accuracy. Michael Jarman is a financial modeling expert and the 2024 Microsoft Excel World Champion, winning the title at the Microsoft Excel World Championship in Las Vegas after defeating a field of the world's best spreadsheet competitors. A financial modeling director based in Toronto, he is known for his mastery of advanced Excel, financial modeling, and high-speed spreadsheet problem solving. (02:24:51) - 𝕏 Timeline Reactions 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 Monday, July 13th, 2026. We are live from the TVP and Ultra on the Temple of Technology, the fortress of finance, the capital of capital. I like the bell, Ben. That's a good one. Let me tell you about ramp.com. Time is money. Say both easy to use corporate cards, bill pay, accounting and a whole lot more all in one place.

• 0:19Jordi Hays?

  Today we're talking about using ramp.

• 0:21John Coogan?

  Ramp, ramp, ramp, ramp. The ramp song. Still going strong.

• 0:24Jordi Hays?

  Ramp, ramp, ramp.

• 0:26John Coogan?

  Excellent edit. We said ramp so many times in the first couple of episodes of this show. We turned it into a song. It's on the soundboard now. Well, huge news over the weekend dropped. Mark Gurman dropped a massive scoop right after we got off on Friday night, Friday afternoon. Mark Gurman broke the news that Apple is suing OpenAI. Apple and OpenAI are going to war. The Wall Street Journal called it thermonuclear echoed past attacks, calling back to the Jobs era. We'll get to that. But first, the accusations. Apple is suing OpenAI, accusing it of stealing Apple's trade secrets. Apple Inc. sued OpenAI for trade secret theft, accusing the artificial intelligence startup and its hardware chief

• 1:10John Coogan?

  of engaging in a coordinated campaign to steal information about upcoming products. The iPhone maker said in a suit Friday that OpenAI encouraged Apple employees to share information, components, drawings and other materials related to upcoming products. So like, the robot? What are the upcoming products from Apple right now? Part of the, part of efforts by the AI company?

• 1:31Jordi Hays?

  The lamp.

• 1:31John Coogan?

  The lamp, yeah.

• 1:32Jordi Hays?

  The lamp, the Cobra lamp.

• 1:33John Coogan?

  The AI company developed its own suite of devices. I feel like rumors around the devices have gone back and forth. Is it a phone? Is it, is it headphones? Is it something else? A pin? We're having Mark Gurman on the show today to break it down for us. He's coming on 12:45.

• 1:48Jordi Hays?

  Funny thing is, I bet Gurman knows more about OpenAI's devices than we do because we specifically

• 1:55John Coogan?

  That's why we're having a

• 1:56Jordi Hays?

  Didn't want to be read in on anything device related because we knew there was going to be so much speculation. Then we just said like, yeah, we're going to be in the dark.

• 2:03John Coogan?

  We'll find

• 2:04Jordi Hays?

  We'll find out like

• 2:05John Coogan?

  From the timeline.

• 2:06Jordi Hays?

  Everyone, the timeline.

• 2:07John Coogan?

  So the center of the lawsuit is a former Apple employee named Chang Liu, who left for OpenAI and allegedly kept his Apple laptop for weeks after he left the company, downloaded proprietary Apple files and encouraged other Apple employees to do the same. Yeah, if that happened, that's a big no-no. When you leave a company, you got to leave your device. On the day you leave, usually, I mean, I was remembering back to, I mean, we had a very graceful transition to this business from, from Founders Fund. But, you know, I had like emails from, in Founders Fund from like people that went to Hereticon, people that'd be good guests. And I was like, I'm not even going to export that. I'm just going to like leave that and I'll reestablish those connections to people, cold email them, find, find their information independently. Just don't take any files. Leave them with the other

• 2:51Jordi Hays?

  Standard practice.

• 2:52John Coogan?

  Yeah, it is standard practice. You know, some people can make mistakes. Also, these are just allegations. None of this is confirmed. And this lawsuit will be going on for like months, if not years. We can go through some of the other historical examples that are sort of interesting to sort of set the, the table on what might play out here. So Apple's filings also spends quite a few words on the fact that OpenAI has poached more than 400 employees from the company in recent years. That's not going to make anyone in Cupertino happy. They hate poaching. There's the famous Steve Jobs Adobe back and forth. Tang Tan left Apple in 2024 to co-found the AI hardware startup I/O with Johnny Ive,

• 3:33John Coogan?

  which OpenAI acquired in 2025 as part of its consumer AI device effort. Tan is now OpenAI's chief hardware officer and he's leading the consumer device effort there. In his lawsuit, Apple says Tan systematically solicited sensitive information from Apple employees who were interviewing for roles at OpenAI. A lot of perspective on this flying around the timeline, but Ben Thompson and Rolf Winkler in the Wall Street Journal, both had interesting angles here. Winkler?

• 3:58Jordi Hays?

  Wait, they have a Ben Thompson at the Wall Street?

• 4:00John Coogan?

  No, no, no. Ben Thompson, extra techery. And Wolf, I said that wrong. Brandon got it correct in that newsletter. Had interesting angles here. We can read a little bit of what Ralph said in the Journal. He says, "Apple's OpenAI suit echoes past attacks." Steve Jobs declared "thermonuclear war," which is a great, if you're trying to fire up your staff and you're going to battle, even if it's mundane.

• 4:25Jordi Hays?

  Going to battle.

• 4:26John Coogan?

  Even if it's just for like, will the next device have 12 gigs of RAM or 32? That's boring. Thermonuclear war is exciting. You got to fire up the, the staff.

• 4:35Jordi Hays?

  The troops.

• 4:36John Coogan?

  So he declared, Steve Jobs declared "thermonuclear war" on Google, on Google's Android operating system in 2010, calling it a stolen product. Now his successor is going to battle against Apple's most, new most dangerous rival. In one of his last acts, as Apple's chief executive before successor John Turnus takes over, Tim Cook fired a missile at OpenAI. In a lawsuit filed Friday, Apple alleged that senior OpenAI executive, who once sat atop Apple's own product design team, was involved in a months-long campaign to steal Apple trade secrets. OpenAI has replied at this point and said, "We have no interest in Apple's trade secrets." But Ralph continues, he says, "Although it isn't

• 5:18John Coogan?

  clear yet what evidence the company has to back up all of its claims, the suit lands before OpenAI has released a product and as the technology industry races to build artificial intelligence-powered devices that can move society beyond the smartphone era." And there's a whole debate to be had for, you know, where that goes and the value of devices in a world where the agents are just kind of off working and you can maybe just text them or send them a message on Telegram. The, the, there's a whole debate over what the, is the, is the future of devices, more devices and different devices? Or is it just no devices? But OpenAI has clearly been working on devices as we know from the I/O acquisition. And the Wall Street Journal says, "The winner could dominate the future,

• 6:03John Coogan?

  just as Apple's iPhone ruled the consumer market for the last 20 years." Quote, "I am not afraid of Apple, but I have tremendous," got to flip to A6. Let's see. "Tremendous respect for them," OpenAI CEO Sam Altman posted on X Saturday.

• 6:20Jordi Hays?

  And he said S-tier company.

• 6:22John Coogan?

  Yeah, he said, oh, that didn't make it into the paper. Maybe the Wall Street Journal readers aren't familiar with a proper tier list. They think S is down at the bottom, when in fact, it is above A. Big tech rivals have long tried to supplant Apple, but so far, Google, Samsung, Meta Platforms, Microsoft and Amazon.com have all failed. It is crazy. People think, you know, okay, Android was successful, but captured like one tenth of the actual value because the margins on Android devices are so much lower. But you forget that Jeff Bezos stood on stage and said, "We're launching the Amazon Fire Phone and we're going to win." And then Microsoft had the whole Microsoft phone and they were really pushing that. And Facebook, Chamath was at Facebook working on the Facebook phone.

• 7:03Jordi Hays?

  Sort of a rite of passage.

• 7:04John Coogan?

  It is a rite of passage. It, it, it's a, it's an ultimate long shot as a, as an up and coming hyperscaler to everyone. It's a rite of passage to go and, and challenge Apple. Now OpenAI is emerging as a new threat. It has, it has built powerful AI models and is working to, toward an unspecified family of devices, interesting to hear that, to run them, devices that could supplant Apple's. Apple's innovation engine failed to develop hit AI products and features, leaving it vulnerable to new entrants. Its suit could be an attempt to throw sand in the gears at OpenAI. I mean, a lawsuit is always a little bit of sand at the very least, even if everything gets dropped quickly, it can still drag on for, for at least a year. Company observers say to slow poaching of Apple staffers,

• 7:48John Coogan?

  for instance. So this could just slow the, the poaching that's happening. Friday lawsuit, Friday's lawsuit has echoes of one of Apple's, of the ones Apple's filed against various Android ecosystem players beginning in 2010, a legal battle royale with hardware makers producing rival phones that played out over eight years. The central allegation then, as now, was a rival stole Apple's innovations. Apple said Samsung slavishly copied the iPhone with smartphones it was already selling by the millions, which Samsung denied. The company settled in 2018 after a long costly battle, eight years. In AI years, that's like a million decades.

• 8:27Jordi Hays?

  Wow.

• 8:28John Coogan?

  At the center of each case, Apple has pursued was a perceived breach of trust. So Google's then chief executive, Eric Schmidt, sat on Apple's board as his company developed Android. So there was like, you're, you're on the board of Apple saying, yeah, we should definitely

• 8:45Jordi Hays?

  Kind of similar to the Krieger Figma dynamic.

• 8:48John Coogan?

  Yeah, very, very tricky. "I'm going to destroy Android because it's a stolen product," Jobs told biographer Walter Isaacson. Apple alleges in its new suit that, quote, "At every level, OpenAI has been stealing Apple's trade secrets. A more junior employee appeared to cross the line by using an Apple employee's login to access Apple servers." But Apple has also accused OpenAI's hardware chief Tang Tan of soliciting trade secrets from its employees in interviews for jobs and encouraging them to bring, quote, "actual parts from Apple for show and tell sessions at OpenAI." Tan worked at Apple for 24 years, rising to vice president of product design, "but bringing parts to an engineering interview

• 9:30John Coogan?

  isn't unusual," say people familiar with the tech hiring process. That was shocking to me. I, it does feel unusual to me. But, I mean, I guess people would bring I don't know if something's public, like if you're bringing like if you're if you just went to the app store.

• 9:44Jordi Hays?

  Yeah, if you worked on if you worked on a recent iPhone.

• 9:47John Coogan?

  Yeah, and you're just bringing that and you're like, I did the button. You see how it clicks this way? Maybe that's okay, but if it's like actual secret parts, that would be really, really bad. Interviewers want candidates to talk through their work. The question is whether the parts were sensitive, something Apple doesn't offer evidence of and is seeking seeking discovery to determine. A spokesperson for OpenAI said, quote, "We have no interest in other companies' trade secrets. We remain focused on building innovative technology that empowers everyday people everywhere." Tan and a more senior employee Chang Liu didn't respond to a quest for comment. At Apple, Tan worked very closely with Johnny Ive, its famous industrial design chief. Ive left Apple to build his own design firm, later poaching Tan.

• 10:32John Coogan?

  OpenAI bought that company, I/O Products, in 2025 to spearhead its own device development efforts. Bedfellows can quickly become enemies in tech. OpenAI made the I/O acquisition, revealing its intention to wean customers off smartphone screens a year after announcing a partnership with Apple to integrate ChatGPT into some parts of the iPhone. The Wall Street Journal has a content licensing partnership with OpenAI, of course. Bigger companies have so far failed to dent Apple's dominance. They talk about Amazon's Fire Phone, Microsoft Windows Phone. Mark Zuckerberg also tried to do an end run around the iPhone with a metaverse that never fully disrupted the iPhone, of course. Elon Musk has also chafed at Apple's control of the digital economy. A unit of SpaceX is suing Apple for disadvantaging its AI app,

• 11:17John Coogan?

  and the company is now prototyping its own smartphone-like AI device. Apple has said that its App Store relies on algorithms and expert curation and doesn't suppress rivals. The irony of Apple's case against OpenAI is that Apple itself has so frequently been accused of stealing others' companies' ideas that it has spawned a new verb, "Sherlocking", which is a reference to an app for the Mac that allowed you to hit, I think, Command Space and get a Finder window to search everything across your entire desktop. That eventually became the spotlight feature baked into Apple, but it was not very good for the company that was running Sherlock. And so, Apple, this is the same like, you know, the labs will steamroll this or this.

• 12:01John Coogan?

  These many companies just got put out of business by this company. And sometimes it works, sometimes it doesn't. It just sort of depends. Apple recently tried to Sherlock Partifal, but it seems like Partifal is doing fine. And so, it sort of depends on the actual product.

• 12:15Jordi Hays?

  Yeah, I've not gotten a single, haven't gotten a single invite from Apple's invite system.

• 12:22John Coogan?

  At the same time, when was the last time you paid for a flashlight app? Probably never, right? Because all of that stuff's baked in. Apple's trying to catch up.

• 12:28Jordi Hays?

  I saw someone actually go pretty viral on Instagram with the world's most expensive flashlight app. I think it was like a hundred. It was it was like $5 to turn the light on and then $129 to turn it off.

• 12:44John Coogan?

  That's great. Genius. I like those.

• 12:46Jordi Hays?

  Pretty smart.

• 12:46John Coogan?

  I also like the ones that are like vibe coding a calculator and you type in whatever you want to multiply and then it's like $200 to unlock the answer. It's like easy money.

• 12:55Jordi Hays?

  Ben Thompson read through the filing as he would. He says, "You can read Apple's filing here, and almost everything you need to know is actually on the first page and the first four paragraphs. Paragraph one is a succinct introduction to the case. This case is about Apple's former employees stealing trade secrets for the benefit of OpenAI. Apple brings this suit to put a stop to it. Paragraph two recounts how Apple has spent a lot of time and money building products that delight customers. Paragraph three basically says that everything they do is a trade secret. And paragraph four introduces Chang Liu and spends the next page and a half recounting his crimes. Ben Thompson says Liu is almost certainly guilty and an idiot to boot." Not mincing words there.

• 13:37Jordi Hays?

  "Apple has a lot of details about Liu's behavior, including dozens, downloading dozens of proprietary Apple hardware-related files and encouraging other Apple employees to do the same because he did it on his Apple-issued laptop and furthermore logged onto Apple servers for weeks after he had already left the company." Ben says, "Apple's security says, 'As depicted in this case, is shockingly poor. First, the company lost track of the fact that Liu didn't return one of his laptops or disable it remotely. Second, due to what Apple claimed was a bug, Liu continued to have access to the company's internal servers for weeks.'" And Ben has like a bunch of, a bunch of other context on here.

• 14:22John Coogan?

  Yeah.

• 14:24Jordi Hays?

  They, he talks about how, you know, Tan is the point person for the 400 people that Apple says that OpenAI has hired away from the smartphone maker. That is no crime, of course, although one does get the sense Apple sure thinks it is. And I'm trying to think if anything.

• 14:44John Coogan?

  The funny, the funniest moment in here is where he says a couple of quick points. "A few weeks ago, there was a bit of hubbub about meta-capturing keystrokes from employees in order to train AI. What confused me was people's surprise that a company had this level of access to company-issued hardware in the first place. Moreover, while that access may very well be theoretical for a lot of companies at Apple, it has always been a well-known fact, going at least as far back as when I was an intern there, Ben Thompson was an intern there, 16 years ago, that the company could and would go through everything if you ever crossed them." And so, it's, it's, yeah, everyone should know this, but somehow it, at least Apple alleges that it was not known or just a terrible mistake or brazen, you know, brazen mistake.

• 15:29John Coogan?

  He does, he does talk about a little bit of the motivations for why you're going to thermonuclear war. He says, "AI era has sucked for Apple."

• 15:38Jordi Hays?

  Yeah, so he says, "Tan is the face of Apple betrayal. OpenAI is the face of AI generally, and it's hard to escape the sense that Apple just really hates AI. And why shouldn't they? Go back to 2022, Apple had it all figured out. They had a lock on the premium end of the smartphone market, which they continued to slowly expand, even as they'd figured out how to earn services revenue from every iPhone user basically forever. Business was good. AI has ruined all of that. Suddenly, Apple has to make existential decisions about whether or not to compete in the model game. Then they, then they totally embarrass themselves with the 2024 new Siri introduction, had their most prominent blogger declare that something is rotten in the state of Cupertino, had to completely overhaul their software and services teams,

• 16:19Jordi Hays?

  lost their position as kings of the supply chain and most favored customer of TSMC, to the point where they had to enact an emergency mid-cycle price rise, and then worst of all, have to actually wrestle with the possibility that AI is such a paradigm shift that it might actually threaten the iPhone. And then on top of all that, they lost, they lose 400 of their best employees, recruited by the lead hardware engineer for the iPhone in partnership with their most famous executive outside of Steve Jobs, and have to know that all 400 of those employees are getting hit up by their former colleagues looking for a job as well. The AI era has sucked for Apple, even if they aren't necessarily doomed, and even if they relaunched new Siri ends up working out. Their position is still more fragile than it was, and everything about life is worse.

• 17:02Jordi Hays?

  Given that, how sweet it must feel to suddenly have a smoking gun in the form of a seriously dumb employee blatantly lifting documents and to use it as a cudgel to exact revenge on the company that represents everything that is making your life miserable. The perspective does make one wonder if that phrase, rotten to its core, was projection in the end. AI is changing the world, and Apple's contribution is to deliver two-year-old technology differentiated by exclusive access to data it won't share. It certainly has no interest in delivering on a new AI-driven paradigm that endangers its iPhone franchise in any way. Any of its employees who wish to do exactly that meanwhile are being told loud and clear that Apple doesn't just think it owns your laptop, but also your mind and knowledge.

• 17:46Jordi Hays?

  I think it mostly stinks, but then again, rotten things usually do." So, circling back to something is rotten in the state.

• 17:54John Coogan?

  It's thermonuclear.

• 17:55Jordi Hays?

  Cupertino.

• 17:56John Coogan?

  But it's not the first.

• 17:58Jordi Hays?

  Go sign up for Stratechery, read the whole article. There's a bunch of context. And we're going to come back to the story at 12:45 Pacific with the Germinator.

• 18:10John Coogan?

  Let me tell you about Railway. Railway is an all-in-one intelligent cloud provider. Use your favorite agents to deploy web apps, servers, databases, and more while Railway automatically takes care of scaling, monitoring, and security. It's not the first thermonuclear war between hyperscalers, Mag7 companies. You go back to Apple versus Microsoft. They had a massive copyright war over the look and feel of the desktop. So, Apple sued Microsoft and Hewlett-Packard, actually, back in 19...what was it, 1997, when they reset the relationship, saying that Windows 2.03 and Windows 3.0

• 18:52John Coogan?

  and the HP NewWave, I don't know what happened with that, copied the Mac's graphical interface. The courts concluded that the similarities were already licensed, functional, standard-to- graphical user interfaces and otherwise unprotectable. In 1994, the Ninth Circuit affirmed that Apple's GUI deserved only relatively thin copyright protection against virtually identical copying. Of course, we talked a little bit about the Android proxy patent war between Apple and Google. Apple rarely attacked Google head-on. Instead, it sued the manufacturers that were distributing Androids, so HTC, Samsung, Motorola, over smartphone design software patents. There was a whole era where you would see Apple launch something and

• 19:35John Coogan?

  then Samsung, Motorola, HTC would sort of conform to that norm. And how much of that is just the standard industry practice, what consumers want, and how much of it is a direct infringement? In 2014, they agreed to dismiss all of their direct smartphone patent cases without entering a comprehensive cross-license. But the broader war continued through Apple's seven-year Samsung battle. In 2018, the jury awarded Apple a $539 million damage in a retrial, after which Apple and Samsung reached an undisclosed settlement. So, Apple won meaningful verdicts and established that industry design could carry real patent

• 20:15John Coogan?

  value. Amazon and Apple, Apple and Amazon have also gone at it over ebook pricing conspiracy aimed at Amazon. This was in 2009. Amazon had established $999 as the highly visible price for many new Kindle bestsellers. As Apple prepared the iPad and the iBook Store, it arranged agency agreements under which publishers, rather than retailers, set consumer prices. The Justice Department proved that Apple could help coordinate publishers to eliminate retail price competition and raise ebook prices above Amazon's $999 standard. And so, Amazon won this one. Apple briefly changed the economics of the market, but lost the antitrust case. Of course, there's Apple App Tracking Transparency, Apple versus

• 20:59John Coogan?

  Meta, another thermonuclear war, not fully played out in the courts, but it did create basically a $10 billion revenue headwind for Meta in the short term, which they ultimately overcame. There's a whole bunch of others. The two Mag7 participants who have never really fought, Microsoft and Meta have never really had a company-level feud. Microsoft and Tesla also have never really had a corporate battle. Tesla sort of stays out of a lot of this because they're not in as many of the same markets. Of course, the big one that people are pointing to these days is Uber versus Google. Where is this? So, this is the most dramatic corporate espionage-style case in modern technology.

• 21:43John Coogan?

  Anthony Levandowski, he was a central engineer in Google's self-driving car program. And as he prepared to leave, he downloaded thousands of confidential files. That's a huge no-no. He founded an autonomous truck startup, Auto, which Uber then acquired, bringing Levandowski and his team inside Uber's autonomous vehicle organization. Waymo alleged that Uber had obtained and was using its LiDAR and autonomous driving trade secrets. The case exposed internal Uber communications, raised questions about what then CEO Travis Kalanick knew, and threatened to derail Uber's already expensive autonomy program. Days into the February 2018 trial, Uber settled. Waymo received 0.34% of Uber's equity, which was

• 22:26John Coogan?

  worth $245 million at the time. It's actually worth more now. I don't know if Waymo held on to that, but it was sort of a financial civil settlement. And, interestingly, Uber promised not to incorporate Waymo's confidential information into its systems. So, they agreed, hey, like, we might have seen some of that confidential trade secret information from that company that we acquired. We won't use any of that. And it feels like that sort of derailed Uber's self-driving program pretty substantially because you're always walking on eggshells. And then there's probably things that you could have potentially independently discovered, but if you know that Waymo has independently discovered them separately, you can't use it. And so, there's all these different techniques and tricks that then are off-limits, even if they are just best practices that you could have found.

• 23:11Jordi Hays?

  The right way to do it.

• 23:12John Coogan?

  Exactly. Yeah. So, very tricky situation. And Levandowski, so there were actually two suits in the Uber-Waymo battle. There was the civil suit, which settled, of course, as I mentioned. But Levandowski separately pled guilty to trade secret theft in a criminal trial. The Justice Department said he admitted downloading thousands of Google files with the intention of benefiting himself and Uber. He was sentenced to 18 months in prison, fined, and ordered to pay restitution. But he was pardoned before he actually entered prison. And then, I believe he started a religion? I think he was starting like an AI church, which was way ahead of the curve, because it feels like people are like in

• 23:53John Coogan?

  AI psychosis as of like 2024. And he sort of had it back in 2021, 2022. He was like leading to this idea that like AI was God.

• 24:03Jordi Hays?

  It was 2017.

• 24:04John Coogan?

  2017?

• 24:05Jordi Hays?

  Way of the future.

• 24:05John Coogan?

  Way of the future. That is crazy, crazy, crazy, crazy. So, Uber eventually sold the Advanced Technologies Group, which was their self-driving unit, to Aurora in 2020. And it valued that unit at $4 billion. So, like, pretty substantial progress for something that was sort of beaten up. And there were a few different reasons. The Waymo litigation cost, technical difficulty, and then there was this fatal 2018 Uber autonomous vehicle crash that really made it difficult for them. And Uber has sort of shifted their strategy now. They're much more of like this platform, and they want, and they don't want to develop self-driving cars internally.

• 24:43Jordi Hays?

  Yeah, they want to work with Cybercab and Waymo and all the different.

• 24:47John Coogan?

  There was recent reporting that Uber's like actually trying to block the rollout of self-driving cars in some markets. And there's a whole bunch of interesting stories about.

• 24:55Jordi Hays?

  Oh, I didn't know Uber was.

• 24:56John Coogan?

  Potentially. It was one tweet I saw. I think it's in the timeline somewhere. We can get to it at some point. But.

• 25:02Jordi Hays?

  What's going on with Paramount?

• 25:04John Coogan?

  Let's go on.

• 25:05Jordi Hays?

  And remember, we're going to come back to this with Mark Germain himself, who broke the actual story on Friday. So, we'll have another 30 minutes to talk about this story.

• 25:14John Coogan?

  We will. But first, 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. Yes, so.

• 25:26Jordi Hays?

  Rohan in Semaphore says Paramount weighs leaving California over Warner Brothers Rift. What's going on here, John?

• 25:36John Coogan?

  So, this is on the basis that California is trying to block the Paramount, the Paramount acquisition of Warner Brothers Discovery. Rohan says, "I'm told that if the states do choose to sue, they would have to assume the damages stemming from that action, chiefly $600 million to $1.2 billion in ticking fees would potentially be paid out to state taxpayers." So, if they leave, those fees would not be paid to the state. Paramount just issued this response to the state AG lawsuit. Brian Stelter is breaking it down, saying the complaint distorts settled antitrust law and is based on misrepresentation of competition

• 26:16John Coogan?

  in the entertainment industry today. So, Paramount is weighing whether to shift major operations out of California after Attorney General Rob Bonta and 11 other state attorneys general filed, attorneys general, I always get that wrong, filed today to block its $110 billion acquisition of Warner Brothers Discovery. This story was back and forth. Well, Netflix get it. Paramount wound up with the highest bid, the most cash to offer. It got approved. Huge windfall for David Zaslove over at Warner Brothers Discovery, but a very controversial acquisition.

• 26:51Jordi Hays?

  And all the shareholders.

• 26:53John Coogan?

  Yeah, everyone did very well. But people were very worried because they own two historic studio lots in Los Angeles. Would they need both of those? Would they convert one to apartment buildings? This was sort of the nightmare case for fans of Hollywood filmmaking, that it would become a more agile, lean, globally distributed studio. Would they be making less films? Would they change their pattern? Because as they are two separate buyers of intellectual property and scripts that come to Hollywood, they can pay higher prices. There's less competition, potentially the price of the, that the.

• 27:36John Coogan?

  The industry becomes more monopolistic and there's less buying activity. So the proposed deal was the and is the largest merger in Hollywood history. It would combine two of the five major film distributors and give the resulting company control of roughly 27% of US film distribution and basic cable channels. Of course, anyone who's in favor of this was arguing that, well, people are watching Instagram and YouTube all day long and listening to podcasts and live streams. You can't look at Hollywood in isolation. It's okay if there's a little bit of consolidation in an industry that's facing incredible pressure from a new disruptive industry. We saw this play out with the shutter stock Getty Images

• 28:19John Coogan?

  question where you have immense pressure in the stock image market from an entirely new outsider technology. Consolidation makes a lot of sense, usually in those scenarios. But if you're just looking at it, if you're just defining the industry as only Hollywood studios, then yes, this is, this does represent more consolidation. Friends and advisors to Paramount CEO David Ellison had reportedly been urging him to reconsider the company's California footprint in the event that California sued over the deal. Previously, Paramount had offered to keep both of its historic studio lots in California open and release 30 films annually, which was basically just adding the 15 and 15 that were made from

• 29:01John Coogan?

  both studios, I believe, something like that. But executives have privately complained that Banta refused to negotiate. Worth noting that the Justice Department has already cleared the merger while China and other international regulators have raised no comparable objections thus far. So from a antitrust perspective, it looks like the merger can go through, but the state of California is potentially trying to block it now. So Paramount says California's complaint distorts settled antitrust law and is based on misrepresentation of competition in the entertainment industry today. It'd be very interesting to see where they actually go if they do leave California, because there's been so much, so much movement

• 29:43John Coogan?

  to Texas and Florida, but in terms of filmmaking, Toronto, London, Atlanta, exactly, so maybe Georgia. I don't know. I'm sure every other state is gunning for this because bringing in, bringing an industry to town is, is almost always a good move. More jobs for your local economy, more, more tax dollars going around. There will probably be a competition, but we'll see, we'll see where this, where this develops and we might have someone from the media analysis industry come on the show later this week to discuss.

• 30:16Jordi Hays?

  There is a new letter, new letter just dropped. We were hoping for a new billion dollar PDF, but we got another letter. More than 200 researchers and economists, including Jack Clark, Jeff Dean, Noam Brown, Tyler Cohen, Schulto, John Schulman, Eric Schmidt, Dean Ball, Joshua Benjio.

• 30:39John Coogan?

  Joshua Benjio.

• 30:40Jordi Hays?

  Have signed a statement urging governments and institutions to act now to prepare for AI's economic impact. They start the

• 30:49John Coogan?

  Pretty simple letter.

• 30:50Jordi Hays?

  By saying, AI may become radically more powerful over the next 10 years.

• 30:55John Coogan?

  They don't, this isn't like the start. It's just three statements. The entire

• 30:59Jordi Hays?

  Yeah, so they're signing, but they're signing.

• 31:01John Coogan?

  They're saying, we all agree with these three statements.

• 31:03Jordi Hays?

  They, they agree that AI could possibly become radically more powerful over the next 10 years.

• 31:09John Coogan?

  Which feels very conservative.

• 31:11Jordi Hays?

  That's like an incredible, you're, you're not committing to anything at all.

• 31:15John Coogan?

  Ah, no. I mean, there are plenty of people that are saying that AI will go away in the next 10 years. Like it's, it's useless, you know?

• 31:23Jordi Hays?

  No one's really saying that.

• 31:25John Coogan?

  Ed Zitron saying that and like 100,000 people are liking his post when he says that. So like, there are 100,000 people out there that are like, it hallucinates, it's dumb, it's, it's not useful. It's going to go away.

• 31:36Jordi Hays?

  People out of billions.

• 31:38John Coogan?

  I'm just saying, I'm just saying, there, there are people that don't believe this. But yes, this does feel like a, like a, like actually an easier statement to agree with than the short timelines of fast takeoff in two years, recursive self-improvement, anything that's coming out of basically any lab is much more aggressive than this. Elon's timelines have been solving new physics in two years, stuff like that.

• 32:01Jordi Hays?

  Yeah. Okay. So point one, AI may become radically more powerful over the next 10 years. Point two, this could drive an unprecedented transformation of our economy, larger than the industrial revolution, but unfolding over a vastly shorter timeframe. It could bring risks, including large scale job displacement as well as opportunities such as major gains in living standards. And three, economists, policymakers and technology leaders must act now to understand the economics of transformative AI and to build the incentives, guardrails and institutions needed to steer AI in a direction that complements humans and benefits society.

• 32:39John Coogan?

  So that last one's not a probability.

• 32:41Jordi Hays?

  Yeah.

• 32:41John Coogan?

  The first one, it feels like you can sign if you're at 1%. 1% chance that it gets more, more radically more powerful over the next 10 years. 1% chance that it drives an unprecedented transformation of our economy. But as long as you agree that economists, policymakers and technology leaders must act now to understand the economics of transformative AI, you sign this. So, so three is really the strongest, the strongest, the, the most strongly worded bullet point.

• 33:10Jordi Hays?

  Well, and it's interesting because the people signing this are technology leaders.

• 33:15John Coogan?

  So that really Not, not the actual top leaders, interestingly. So if you look at who signed this, you have a ton of people from OpenAI, Anthropic, Stanford, Meter, like every Harvard, like every lab.

• 33:29Jordi Hays?

  Bam Margera, I think you said.

• 33:31John Coogan?

  No, no, no. Google, Jeff Dean, like you have people from top, from top institutions, but not the CEOs, not the investors. Like there's been other, there's been, I mean, I guess Reid Hoffman and Jan Tolan and who else is, I mean, Eric Schmidt's on here, but notably absent are Sam Altman, Daria Amade. I don't believe Demis is on here. Is he on here?

• 33:55Jordi Hays?

  Yeah, but you, you have Jack Clark, Sarah Fryer.

• 33:57John Coogan?

  Yeah. So, but what's interesting is that it's, it's sort of like the proxies. It's the, it's like the right-hand men and women of the AI leaders that are signing. And so you have to imagine that, that Daria, Sam, Elon, Demis, Sundar, Satya, like they got the message. This was received to them and they were like, you guys can solve this, but you can sign this, but we're not signing it. Because this doesn't feel like something that happens behind the scenes where Sarah Fryer doesn't go to Sam or, or Schulto doesn't bring this up to Daria. Oh, there's a new letter. I'm thinking of signing it. Like, it feels like it's

• 34:33Jordi Hays?

  There was the, like that, that big pause letter that Elon did sign at one point.

• 34:37John Coogan?

  A lot of people signed it. And that one, every lab leader actually did sign. And this one isn't even a pause, but somehow didn't rise to the aura level. And maybe that's deliberate because then it gets clipped and turned into headlines where it's like, you know, blank lab leader, fill in anyone. It's going to be a, it's going to be

• 35:00Jordi Hays?

  Leaders at XYZ lab.

• 35:02John Coogan?

  It's going to be head of blank lab. If you're the first one to jump, if you're Sam or Dario or Demis or Elon, they just said that it could bring large scale job displacement. So you, you're going to have that headline tag next to you as opposed to if it's like someone at a lab who is not the CEO of that lab says it can bring large scale job displacement. Cause right now it seems like at the very top, a lot of the lab leaders are sort of backing off of the near-term job displacement worries.

• 35:35Jordi Hays?

  Yeah, but I, I think this still feels much more like the, the AI doc than like AI 2040, right? And that like, the, the message I got from the AI doc was like, we all got to talk about this, you know, let's get everyone in a room and like figure something out. We don't know at all what it's going to be. We got to figure something out. Where AI 2040 is like, okay, we have this, this is our, our plan A.

• 35:53John Coogan?

  Yep.

• 35:54Jordi Hays?

  We should be doing this specific set of, of, you know, policies, tasks, whatever.

• 35:58John Coogan?

  Yes. It's like specifically

• 36:00Jordi Hays?

  We all got to talk about this.

• 36:01John Coogan?

  Unifying rules with China, like US and China, like nuclear level negotiations on how things slow down. It's, it's, it's a global slowdown of large scale AI training runs essentially. And this is very, yeah, this is very, very different. So much easier to sign, but AI 2040 didn't have like signatories. I mean, it had people that like helped out with it in general. And then they did poll them as to, they pulled some of the authors to say like, which one do you think is most likely to play out? But I guess by any, I guess everyone implicitly in the AI 2040, if you contributed to that document, you're

• 36:40John Coogan?

  sort of alongside advocating for, is it plan A? Cause it's the fourth one that they offer. I think, is it plan D?

• 36:48Jordi Hays?

  I think plan A is, is what they

• 36:50John Coogan?

  Plan A.

• 36:51Jordi Hays?

  There's a bunch of plans and then I think like in the order on the website, I think it is the fourth one, but that's arbitrary.

• 36:57John Coogan?

  AI 2040. I'm trying to load the site, but it's not loading. Anyway, we can come back to that. We must act now. I, I like this. I like, I like the idea of, of more economic research, more policymaking research to understand these things. It, it's not like, it's hard to get wrong because the end result is just more information, more studies, more, you know, conversation and proposals. It's not anything specifically. Like if it was like, like large scale job displacement is coming next month, we need to, you know, print money and do economic stimulus broadly like we did during COVID. I would be like, I don't know that, that, what if the job displacement doesn't come

• 37:42John Coogan?

  up and we just create a bunch of inflation? Like, I don't, I don't know if we should do that. But we should be ready for if we hit 10% unemployment, 15% unemployment, that we do have stimulus in the back pocket. And I think we do with where interest rates are and with the, with the history of how we've dealt with employment shocks in the past. So I think we are like set up pretty well if that happens. It doesn't seem like it's happening at this moment, but

• 38:06Jordi Hays?

  Yeah.

• 38:06John Coogan?

  Tell us about the

• 38:07Jordi Hays?

  The critical, the critical view on this is the people building the technology say that we got to do something about this.

• 38:19Jordi Hays?

  Like, like, it's kind of a just continuation of like, that we gotta do something about this. And maybe you just need to do a new letter every single month forever.

• 38:27John Coogan?

  Maybe.

• 38:28Jordi Hays?

  But.

• 38:29John Coogan?

  I don't know. Let me tell you about Figma. Agents, meet the canvas. Your AI agents can now create and modify your Figma files with design system context. I want that. For the next ad read, I want the ship horn. The ship horn is where it's at. That one is so underrated.

• 38:45Jordi Hays?

  So I wanted to talk about the mustard controversy over the weekend, but the original video was deleted.

• 38:50John Coogan?

  Okay.

• 38:50Jordi Hays?

  And it's now really hard to.

• 38:53John Coogan?

  Just describe it to me. We have audio listeners.

• 38:55Jordi Hays?

  So there's two car content creators in the LA area.

• 39:01John Coogan?

  Okay.

• 39:01Jordi Hays?

  One of them is an account called Collected Bands.

• 39:04John Coogan?

  Okay.

• 39:05Jordi Hays?

  Who's a Porsche enthusiast, a BMW enthusiast, likes to drive fast.

• 39:10John Coogan?

  Younger.

• 39:11Jordi Hays?

  Uh, on the younger side. And then you have a guy named Canyon Carver, who's effectively like a vigilante of the canyon. So he hangs up in a lot of the popular driving areas.

• 39:23John Coogan?

  And he doesn't like to drive fast? Canyon Carver, that's.

• 39:25Jordi Hays?

  He likes to drive like pretty, I would say, close to the speed limit.

• 39:29John Coogan?

  Okay.

• 39:30Jordi Hays?

  Um, and so he hangs out places like, uh, ACH in the Santa Monica Mountains, you know, around Malibu.

• 39:36John Coogan?

  ACH?

• 39:37Jordi Hays?

  Uh, Angeles Crest Highway.

• 39:38John Coogan?

  Okay.

• 39:39Jordi Hays?

  And, uh, which is, which is near you.

• 39:41John Coogan?

  Yeah.

• 39:42Jordi Hays?

  And so he likens himself to kind of the sheriff or the mayor.

• 39:47John Coogan?

  The Batman.

• 39:47Jordi Hays?

  He calls him the Batman. He, uh, claims to be the original Meta Ray-Bans like car.

• 39:53John Coogan?

  Oh, interesting.

• 39:54Jordi Hays?

  Guy.

• 39:54John Coogan?

  Okay.

• 39:54Jordi Hays?

  Uh, I don't know.

• 39:55John Coogan?

  That was you.

• 39:57Jordi Hays?

  Uh, I don't know. I don't know how true that is, but, um, over the weekend, these two, uh, cross paths.

• 40:03John Coogan?

  Collided.

• 40:04Jordi Hays?

  And, uh, there, there was a video that ran up to hundreds of thousands of likes, uh, before, on, on Saturday to Sunday before being deleted. Uh, where the Canyon Carver is driving and he gets passed by, uh, this other car influencer. And then they end up, um, they end up, uh, uh, in the same parking lot and they have a very, uh, quite a funny exchange where they're just talking. Uh, talking, talking past each other sort of perfectly. Uh, the younger guy is accusing, uh, the Canyon Carver of just being 40, which is kind of funny.

• 40:44Jordi Hays?

  And, uh, the Canyon Carver is accusing the other, the, the younger guy of, uh, his dad buying the car for him, to which he immediately says, uh, just because my dad bought me this car, doesn't mean I can't afford it, which is, which is a, which is a funny, um.

• 41:01John Coogan?

  Yeah.

• 41:02Jordi Hays?

  Which is a funny line, but anyways, this is so inside baseball, like LA, Southern California, car enthusiast drama that I think it's time to move on because without the original video.

• 41:14John Coogan?

  Doesn't work.

• 41:14Jordi Hays?

  It's, it's really tough.

• 41:15John Coogan?

  What is your stance on cutting the mustard?

• 41:17Jordi Hays?

  Yeah. So I'm very against cutting the mustard.

• 41:21John Coogan?

  Okay.

• 41:21Jordi Hays?

  Um.

• 41:22John Coogan?

  You like a safe highway, a safe canyon to be carved safely.

• 41:25Jordi Hays?

  Yes. So cutting the mustard is when, uh, you know, if someone is driving fast on a, let's say a canyon backcountry road and they're using the entire road, right? They're sort of disregarding the lanes.

• 41:35John Coogan?

  Double yellow line.

• 41:36Jordi Hays?

  Yeah, double yellow. They're crossing it because.

• 41:37John Coogan?

  Which is a moving violation. That's illegal, right?

• 41:40Jordi Hays?

  Yeah, no, it's objectively, uh, against the law.

• 41:43John Coogan?

  Yeah.

• 41:44Jordi Hays?

  And then, uh, it's very dangerous because you're coming around a tight corner and if somebody's in your lane, it can be over, uh, really quickly.

• 41:51John Coogan?

  Maybe, maybe we should have a sort of a, um, like a, an auto bond style rule where the yellow line doesn't apply. There's certain highways in, in, in America. It's like, we, we can't, we can't get over the speed limit thing. We gotta have the speed limit. There's still a hard speed limit, but you can drive wherever you want.

• 42:12Jordi Hays?

  Absolutely not.

• 42:13John Coogan?

  That'd be crazy.

• 42:14Jordi Hays?

  Absolutely not.

• 42:14John Coogan?

  Uh, I mean, the problem is like, is like Willow Springs is like 45 minutes away. Just go to the track and it's a public course. You can pay and go and drive as fast as you want. And there is no traffic coming the other way. It's much safer. So if you're trying to push your car to the limit, like there is a way to do that legally and safely. And so you should probably just do that.

• 42:33Jordi Hays?

  I thought it was interesting because it was very generational. You had like the millennial, uh, you know, against the, the brain rotted sort of zoomer. And, uh, then they just couldn't even have a conversation. They were just sort of speaking past each other, you know, doing, uh, various ad hominants.

• 42:50John Coogan?

  Okay. Well, last car question from Reddit, r slash wealth. If I inherit $4 million USD and a home at 35 years old, would it be responsible for me to just buy a Ferrari? Why just? It's a funny way to put it. I think, yes. I mean, you're not gonna probably beat the S and P, but, um, a lot of the cars hold their value. Might be fun. I don't know. It depends on your lifestyle. If you have five kids in private schools or something like, four million probably isn't enough. Depends on where that home is. Do you live in Manhattan?

• 43:21Jordi Hays?

  It comes down entirely to what car you select.

• 43:24John Coogan?

  Yeah.

• 43:25Jordi Hays?

  Because there's a lot of cars that, you know, if you're not driving them a lot, it would probably, you know, at least track T-bills, right?

• 43:34John Coogan?

  Yeah, yeah.

• 43:34Jordi Hays?

  From a, from a appreciation standpoint.

• 43:36John Coogan?

  I live in Manhattan. I'm trying to send my kids to the most elite boarding schools. I have seven kids and I'm considering a Luchè. That would be a rough go. But if you're out in, you know, an affordable town, plenty of space, you're not going to spend that much money. The four million is going to last you a long time. Maybe pick up a.

• 43:54Jordi Hays?

  Um, there was a powerful omen in Yellowstone National Park.

• 43:58John Coogan?

  Why was this?

• 43:59Jordi Hays?

  Friday evening.

• 44:01John Coogan?

  Uh, oh yes, this bison. We gotta play this video.

• 44:03Jordi Hays?

  Bull bison.

• 44:05John Coogan?

  A tourist was seriously injured Friday evening after being thrown eight feet into the air by a bull bison in Yellowstone National Park. If you're in Yellowstone, be very, very careful. I didn't realize that bison roamed so freely and could, and were so, uh, aggressive. Uh, professional photographer, Mike McCleod, uh, filmed the incident and said the bison was angry, agitated and charging anything and everything. And the, the scale of this beast is really massive. Uh, it looks absolutely huge. And it goes all around chasing this, uh, this poor elderly tourist who.

• 44:44Jordi Hays?

  Who ended up being totally okay.

• 44:46John Coogan?

  Oh, really?

• 44:47Jordi Hays?

  And when you see this, it's almost unbelievable.

• 44:50John Coogan?

  That's remarkable. It's, uh, uh, Cowboy State Daily says tourist was seriously injured, but I guess the man, uh, did recover, which is very, very good to hear. You never want, uh, to see someone injured on the timeline, but he really does get thrown way, way in the air and he's running around. I was wondering, he should have gone for the car right there, right? But there, there you go. He's thrown in the air. Absolutely insane.

• 45:13Jordi Hays?

  Uh, I'm so glad he's okay.

• 45:15John Coogan?

  I like that people are already remixing this. Uh, Wild Spicy says, uh, if it was me out there.

• 45:21Jordi Hays?

  We gotta.

• 45:22John Coogan?

  Different. Throw the bison in there.

• 45:23Jordi Hays?

  Yeah. If Alexis, if that was Alexis being chased, this is what would have happened.

• 45:27John Coogan?

  Bring Alexis in, but first let me tell you about the New York Stock Exchange. Want to change the world? Raise capital at the New York Stock Exchange. Look at that foghorn for me. Well, we have Alexis Ohanian from 776. He's the founder and GP with us here in the TVP in Ultra Dome. Alexis, how are you doing? Welcome to the show. Doing very well, gentlemen.

• 45:45Alexis Ohanian?

  Uh, and glad, glad that guy's okay. You know, I saw, actually, if you find yourself in that situation, apparently if you run, I think bison can't go laterally. So you wanna kind of zig.

• 45:54John Coogan?

  I thought that was crocodiles and alligators. You want to zigzag. Is zigzagging just a jazz? Oh, that's a farce.

• 45:59Alexis Ohanian?

  I, I think that's something Floridians tell tourists.

• 46:02Jordi Hays?

  You gotta be like NFL mode, just running routes.

• 46:06John Coogan?

  Running routes on the bison?

• 46:07Alexis Ohanian?

  Yes. That's the move.

• 46:09John Coogan?

  Absolutely.

• 46:10Jordi Hays?

  Good to know. Good to know.

• 46:11John Coogan?

  Absolutely wild. Uh, how is your summer going? Are you engrossed in World Cup? What, what, what's your summer been like? Give me a little recap.

• 46:18Alexis Ohanian?

  Ironically, ironically, I have spent most of this World Cup actually in Europe, watching the matches back in America at like two, three in the morning.

• 46:27John Coogan?

  Yeah.

• 46:28Alexis Ohanian?

  I'm more, you know, I'm more of a women's sports fan.

• 46:29John Coogan?

  Of course, of course.

• 46:30Alexis Ohanian?

  But it's been great. It's been great watching. The American men showed up in a big way. Obviously, you know, it didn't get as far as any of us, you know, we would have wanted to see a title, but very happy for the American men, uh, to have made it to the 16. And I don't know who to root for now. I guess technically England.

• 46:43John Coogan?

  Yeah.

• 46:44Alexis Ohanian?

  Given my Chelsea women's connection, but we'll see.

• 46:46John Coogan?

  There you go. Uh, yeah, I want your, uh, current thesis on premier in real life events. Maybe in the age of AI, maybe there's some other boom happening, but I have some stats here that are crazy that were on the timeline from Adam Miller. UFC, uh, they sold, it sold for $4 billion in 2016, worth $15 billion today. F1 revenue is up 115% since 2017. Team values are up, uh, 276. FIFA World Cup, viewership is on track to, to pass 2022's $5 billion. Revenue's up 56%. NBA media rights tripled in a decade. NFL, 110 billion in media rights through 2033.

• 47:26Alexis Ohanian?

  And O'Donnell knows.

• 47:27John Coogan?

  Broadway is up. Live comedy tours grossed more.

• 47:31Jordi Hays?

  They call them.

• 47:32John Coogan?

  High Rocks.

• 47:32Jordi Hays?

  6 billion.

• 47:33John Coogan?

  High Rocks went from 650 athletes in 2017 to 1.5 million. World Music Tours, top 100 tours grossed 8.9 billion. How are you thinking about this? Is this an opportunity as a, as a fan or as an investor or as a businessman? Like what, what, what's your overall thinking on live events in the future?

• 47:50Alexis Ohanian?

  Look, like last time I was on here, I think I was gassing up my track and field league.

• 47:54John Coogan?

  That's right.

• 47:54Alexis Ohanian?

  With the Olympics there, Athlos, every year, not just every four years. I've been obviously very early in sparking the women's sports movement, starting Angel City and the investment there. But I, you can roll the tape. There is footage from I think two and a half years ago at Cannes Lion where I call sports the ultimate anti-AI bet. And I think just two weeks ago, JP Morgan Chase is on stage saying the same thing. So what we mapped out at seven seven six, three years ago, right after ChatGPT.

• 48:21John Coogan?

  Yeah.

• 48:21Alexis Ohanian?

  Was basically, we know it's going to get really good at writing, and then it's going to get really good at writing code. And then, you know, once, actually it was after Dali, I was like, okay, even this first version is janky.

• 48:31John Coogan?

  Yeah.

• 48:32Alexis Ohanian?

  But moving pictures are just one step away from static pictures. So in the world of entertainment, right, the pillars of entertainment, you have music industry, you have movie Hollywood, and you have sports. What will remain unchanged and durable in the age of AI, even when you can have a pixel perfect highlight of Mbappe scoring a goal, it will do nothing for the soul.

• 48:53John Coogan?

  Yeah.

• 48:53Alexis Ohanian?

  Because it never actually happened. The human experience is the reason why it's valuable. And I, you know, Josh Kushner, who's a friend and obviously incredibly successful investor, his first investment from Thrive Eternal, great name by the way, was San Francisco Baseball Giants.

• 49:05John Coogan?

  Yep.

• 49:06Alexis Ohanian?

  Like, like, we're now seeing a moment where the smartest folks in venture capital are realizing this is not just a trophy asset. And what, what we've been privileged to see now for three, four, five, six years, is under the hood of these organizations, guys, these, the best sports teams in the world, the best sports leagues in the world are run like a tech company in like the mid aughts. They are devoid of modern technology. They're there.

• 49:31Jordi Hays?

  Yeah, I've asked, every time an athlete comes on here, I'm expecting them to have some like, you know, basically performance, super intelligent.

• 49:39John Coogan?

  Yeah, like, oh, I have a database with every lift I've done. It tells me exactly what to lift and what, where to ice. And it's like, no, I just have a guy that, you know, tells me if it hurts, I walk it off.

• 49:49Alexis Ohanian?

  And, and it's also on the business side of the house, right? And so it's, it's even if you, even asking a question like, what CRM do you use? Like, again, you're going to get some weird looks and like, maybe it's Salesforce or like, oh, we've been trying this new thing called HubSpot.

• 50:03John Coogan?

  Yeah.

• 50:04Alexis Ohanian?

  And, and so all across the stack, there is tremendous opportunity for efficiency for software. And so the smart money, we're, we're, we're investing and they're also figuring out how to invest in the tools that'll make these even more profitable enterprises. And I'm fired up because I also, I get, I, I spend all of my time at seven seven six, either investing in the technology of the future that is going to accelerate. So we all had Philip on here, our guy from Star Cloud, right? Data centers in space, crazy ambitious infrastructure play. Or the other end of the barbell of everything I know will be left.

• 50:36John Coogan?

  Yeah.

• 50:37Alexis Ohanian?

  And so a consumer electronics company like Mod Retro, let software keep getting cheaper to make. We still need to have physical things to play those games. We should make them closer to or in America. And so that's a trend that I know is going to continue to grow. And so I, I, I really see the world through those two sides of the barbell, either rapidly accelerating the world or everything that I know is still going to be left and matter even more. And it's funny, you mentioned Broadway.

• 51:00John Coogan?

  Yeah.

• 51:00Alexis Ohanian?

  Pull the tweet. I think it was a year and a half ago. I'm still trying to find the venture backed model for it. But my bet was because anyone will be able to sort of dream up their version of Iron Man where they're Iron Man. And obviously with making sure Daddy Disney gets their check. But like, you're going to have this dispersion of culture and like acting at the end of the day is way more normal for our species in person than it is going into a dark theater and watching it on a screen.

• 51:25John Coogan?

  Wow, I found the tweet. I found the tweet. Bonus hot take. I think we'll see live theater make a comeback in the next 10 years. And you said this July 7th, 2024.

• 51:34Jordi Hays?

  I got, I got one for you.

• 51:35Alexis Ohanian?

  Yeah.

• 51:36Jordi Hays?

  I think you should incubate a robot circus, an event that you can go to. And, and I, I think in about two years, you will have robots capable of feats that will be wildly impressive. You can imagine like a drone show that where the drones fly up to within, you know, a foot from your face. You've got humanoids going, going crazy.

• 51:59Alexis Ohanian?

  There's some French Canadians right now running Cirque du Soleil who are very mad. I think, I will, I'll give you this.

• 52:04Jordi Hays?

  Yeah, it's robot Cirque du Soleil.

• 52:07Alexis Ohanian?

  I think there is, so part of the why, at least for me with those things, and maybe this is just exposing myself as a bad person, is the fact that you're like, again, you're not hoping anyone gets hurt, but it's this anxiety of like, oh my God, what's going to happen? Like, is this person going to survive this death defying act? And

• 52:23Jordi Hays?

  Yeah. So you need to make the, the, the person viewing it feel like they're going to die. That's the thrill.

• 52:29Alexis Ohanian?

  I see. So now this

• 52:30Jordi Hays?

  It's a drone. It's a drone that flies. It's a, you're strapped in, you're strapped into like a, you know, like a roller coaster seat and the drone flies like at two feet from your face, you know?

• 52:40John Coogan?

  I can, I can dig that.

• 52:41Jordi Hays?

  Movie action.

• 52:42Alexis Ohanian?

  The, I do think, I'm, I'm fond of saying that like, no one will pay money to watch like robots play soccer. Or imagine golf is an easy one. No one's going to want to watch a Ryder Cup where, you know, you get 18 hole in ones against another 18 hole ones. But, but there are some sports, you know, we've seen BattleBots, right? There, there's, there's versions of that with like gladiators, sort of robots fighting to death. There's probably a version of drone racing.

• 53:06John Coogan?

  Yeah.

• 53:06Alexis Ohanian?

  That allows, oh, you play Twisted Metal, but allows weapons.

• 53:10John Coogan?

  Oh, yeah, yeah, yeah.

• 53:10Alexis Ohanian?

  Drones, right? There's, there are, there are new sports that are like, that are actually entirely robotic, but that are levels up of American one or human ones that we don't want humans doing. But, uh, but I had not considered making it an experience for the fans. So.

• 53:23John Coogan?

  Okay. So, uh, really quickly. So, um, uh, as live events are growing, I feel like a lot of collectibles come out of the live event. It's like the game ball, the, the, the card of the player who played in the live event. And you're sort of, uh, there's like this chain of custody, chain of authenticity. This thing happened, this human was great at this thing. There was lore. You could have gone and saw it with your own eyes. And now there's a card that commemorates it. What's going on in the collectible space? Is there as much of a boom there? What do you expect happening over the next couple of years? And what are you doing specifically?

• 53:58Alexis Ohanian?

  Well, you know, a few years back, I created the, when I heard trading cards were coming back, I quietly amassed the largest collection ever of my wife's cards, just because I didn't want them ending up in some other collector's house. I wanted my kids to have that.

• 54:10Jordi Hays?

  You're like, no one's going to make money on these cards, but me.

• 54:14Alexis Ohanian?

  These are family heirors. No, no, they're going to stay in the family forever.

• 54:17John Coogan?

  No, no, but you also, you drive up the price by, by taking all of those cards into the treasury. And so everyone's like, oh, the, the lore is growing. Yes. And knock on effects.

• 54:27Alexis Ohanian?

  I, um, and then I was the lead investor in Alts, so Marketplace, which just had, they just set a record for an all time kaboom. It was like a $1.4 million for a one of one Wemby.

• 54:36John Coogan?

  Wow.

• 54:37Alexis Ohanian?

  And you're starting to see real dollars. So it's a, it is a, a brand within the universe of trading cards that was inspired by like 90s era comics.

• 54:46John Coogan?

  Okay.

• 54:46Alexis Ohanian?

  And so it's your favorite players, but sort of restylized as like cartoons, almost like comic book inspired art.

• 54:51John Coogan?

  Yeah.

• 54:52Alexis Ohanian?

  And for whatever reason, it struck a nerve with the culture. And, and so you have these record auctions happening. I'm a big fan of collectible video games, match worn, you know, athletic apparel, all these things I think are culture assets for us. Like, uh, having an 86 Fleer Jordan rookie card on my desk in mint condition is a better, sort of more satisfying flex for me than having like a Warhol. No offense to Warhol, but I think the energy of contemporary art.

• 55:18John Coogan?

  Yeah.

• 55:18Alexis Ohanian?

  I think this is our contemporary art, especially for a generation of us who grew, grew up collecting or idolizing. And, and now that, you know, Tops and others have gotten much smarter. Oh, by the way, I bought a trading card company.

• 55:27John Coogan?

  Yeah, explain that. I mean, is this normal for a VC firm? Is it within the firm? Yeah. Very interesting strategy.

• 55:35Alexis Ohanian?

  When you're the biggest LP in the VC firm, you get to kind of do what you want to do. We have amazing institutional LPs, don't get me wrong, but like, I, I sign up every deal we do at seven seven six, I'm, when I'm hitting send, I'm thinking of my kids' inheritance, right? It's, this is my money more than anyone else's.

• 55:52John Coogan?

  Totally.

• 55:52Alexis Ohanian?

  And so, or theirs, really. And so with trading cards, this was a, a modest sized company that was specializing in college sports. Obviously NIL has changed the landscape of that. And this long tail of college athletes, a guy like Mendoza gets a card deal with us, and he doesn't just get his rookie card, his left tackle gets a card. So the guy protecting his ass, who may never get to play in the NFL, may never get a card. He's getting a card with on it. And you know, I love the fact, uh, we actually have just as many, we have more women college athlete cards in the last year than every other card company combined. So there's a long tail there. University of Nebraska Women's Volleyball sells more cards than the men's football team.

• 56:30John Coogan?

  Whoa.

• 56:30Alexis Ohanian?

  And so it's focused on a part of sports that I obviously love. I think college is obviously a huge and booming opportunity. And these companies all need software now. They all have an opportunity to get so much more efficient.

• 56:42Jordi Hays?

  Do any of the athletes turn it down?

• 56:45Alexis Ohanian?

  No, it's, I mean, the amazing thing is, we're playing at a level where, like, some of these guys are making so much money in NIL deals, that the kind of deal we're striking with them is not-

• 56:55Jordi Hays?

  Like 10, 15 million?

• 56:57Alexis Ohanian?

  No, well, no, that's the amount that they're making all year. That's not what I'm paying them. No, no, no, no. These card deals are still pretty small ball. And so, relative to the deals they're getting from big brands. And what's dope is, you know, most of these guys are thinking big picture. And if they make a little less money doing an audit deal, but every other guy on their team is getting a card-

• 57:14John Coogan?

  Oh, sure.

• 57:15Alexis Ohanian?

  They're not mad. They're not mad sharing that. And the athletic directors love it, because we're also working with the women athletes just as much as we are with the men. So that's the focus. And, and I'm, but I'm inspired by so much of the motion and creativity happening here. Even Jensen Wong's leather jacket going on sale, I think it's only the second one that's been auctioned. These are cultural moments, and I know we live in a weird little myopic tech world, but like, those are the kind of things I want to bid on.

• 57:41Jordi Hays?

  Have you, have you bid yet? You know, you know, the Jensen jacket is-

• 57:46Alexis Ohanian?

  I'm competing against myself now.

• 57:46Jordi Hays?

  The, you know, the Jensen jacket's going to a good cause. It's our friend Justin Mayer's Inflection Grants. So all the money, all the proceeds are going to be given to, to, you know, founders, no strings attached, no equity, just love the game. How, how much do you think the boom in live events is driven by social media and flexing? Like, these are the, you know, very exclusive, basically, you know, you can call them like one of 10,000 assets, right? Or they're these like ephemeral, you're buying a ticket, but it's also, you know, there was a very viral post over the weekend.

• 58:29John Coogan?

  The AI narrative is almost like the next bull case for live events. And in fact, the current boom is driven more just by people seeing cool events happening on social media. And then also just feeling isolated. They're spending a lot of time on their phone. They're like, I gotta get out of here. I should go to that live event. And everything else outside of the live event is free, so I'll spend more money on the live event, because I can basically watch every music video ever created for free on YouTube, et cetera. And I, I agree with you that the AI thing is, is going to be big, but it doesn't feel like the current driver.

• 59:00Alexis Ohanian?

  I, look, I don't disagree, and I would, I would also think of it as sort of just like that K shape happening in the economy. And I think you're gonna see, right, one of the things, the Wimbledon ticket is gonna continue to be even more exclusive, even more scarce, because there's just a finite amount of access to it, right? But I also wouldn't discount growth on the other end, which is, I think, a bigger culture shift. In building Athlos, one of the things that's been really eye-opening for me is we partner with run clubs in order to build our fanbase. Now, just because you run doesn't necessarily mean you're a fan of track and field, but it's very easy to get you to be one, because these are the best in the world doing what you like doing for fun. The average soccer fan doesn't play soccer very often, right?

• 59:42Alexis Ohanian?

  And so by learning about run clubs the last two years, not firsthand, but I've learned that it is a way for Gen Z to push back on the toxicity of online dating culture. It is a way to push back and almost break the sort of jaded narrative of like online life, to actually like meet with people, decide if you want to spend more time with them or not, again, platonically or romantically. And I think there's also a culture shift happening among Gen Zs in particular, who have kind of lived through the dark parts of social, and have just said, fuck the algorithm, I think not all of them, but I'd say like a material majority, and said, I crave IRL. And it doesn't cost a Wimbledon ticket to go join a run club, but it's an experience that is verifiably human, which is harder and harder on this dead internet.

• 1:00:26Alexis Ohanian?

  And, and it's a chance to get laid. It's a chance to meet someone who could be a lifelong friend. Like, there's, I, I think the, that part of the barbell that gets me excited is that side of like, the things we've done as a species way longer than this modern age of the last couple hundred years. And I think those food, I mean, this is, it's such a dumb thing, but like, I, I think if, if we get the AI utopia we all want, right? This gets cheaper and easier and better to make, and it's healthier for you, it's more accessible to more people. There are so many things that are still going to be invaluable that will still give us, and I hope give us even more of a purpose to live, whether it's getting food together or going for a run together, shouting at a soccer game, or screaming with our favorite singer,

• 1:01:06Alexis Ohanian?

  or laughing at a stand-up comedian's jokes. Like, I actually, I'm, I'm very bullish on humanity for if this goes right, us actually having even more appreciation for the shit that, like, a world that our great, great grandparents would actually really recognize as being like the sort of fundamental parts of humanity.

• 1:01:23John Coogan?

  Yeah.

• 1:01:23Alexis Ohanian?

  And, uh, I don't want to see you come from this.

• 1:01:25Jordi Hays?

  How did you process, uh, given, you know, given your work with Athlos, how did you process the enhanced games? It felt like, to me, to me, it was like one of those ideas that, that sounded so cool in theory. But then, as I was watching it, I realized like how much of the Olympics is about the pain and the glory and the sacrifice, and representing your country, and like the every four years dynamic, and just how different a gold and a silver are, even though they're right next to each other on the podium. And so when I was watching it, it just felt like drinking a flat soda, you know? Where it's like, you got a little bit of the taste, but it doesn't hit. And here's how you, how you felt.

• 1:02:09Alexis Ohanian?

  Yeah, look, I, and I would not, I, I am, I know those guys, I am happy they did it in the sense that I do think those regulatory bodies, WADA and some of these others, are very, very antiquated with how they think about usage and testing. And even you, you hear about athletes getting suspended for marijuana, like, like things where it's like, is this really in the best interest of preserving the sport? And I do think guys like Brian Johnson and others, who are hu- human guinea pigs for things that could benefit all of us, a great benefit to society, right? Where this one rubbed me the wrong way, or at least where I knew I wasn't gonna want to be party to it, was because, I mean, the thing you nailed, obviously having a wildly successful professional athlete for a wife who is also accused for so much of her career of some bullshit doping, right?

• 1:02:53Alexis Ohanian?

  The idea of a league that is leaning so heavily into everyone dopes is just anathema to what I really believe sport is about. But I'm still, look, I still think, like I said, I think it's, I, I think it's important to move the narrative forward of like what actually should be approved and not. And, and I also think, hopefully, it gives people more of an appreciation, like you said, for the fact these athletes sacrifice. And probably it's a similar narrative that we had, when I found out how little money most Olympic athletes actually make. Like, before Athlos, the top prize for a track and field athlete was $30,000 in a season. They would win the championship that year, be the fastest man and woman in their race, man and woman. It was 30 grand! You can't be professional athletes, you need to go on a trombone, yeah!

• 1:03:36John Coogan?

  There you go.

• 1:03:37Alexis Ohanian?

  There it is. And, and so we doubled it, just because of the obvious first step. There you go. And then we've, I think we have, we have 2.1, we have over 2.1 million in prize money this year for two races, one in New York, and we're giving equity. Like, like, these are all things, and I think the enhanced games prize money is also a helpful way to push that conversation forward of saying, hey, these Olympic athletes should actually, they're worth more. And, uh, and so I think that's good for them. But yeah, like I said, I couldn't, I couldn't personally get behind it for those reasons.

• 1:04:04Jordi Hays?

  Uh, how are you, last question, since we're out of time, uh, how are you processing just the explosion of sports betting? As I was, and, and kind of how it's driving sports and live events and providing a lot of funding. But at the same time, I was watching, uh, you know, watching the, the McGregor fight, if you could call it that, on Saturday. And like, they don't even do betting exclusives anymore. It's every single ad is for a different sports book or prediction market.

• 1:04:36Jordi Hays?

  And, uh, and, and, and so, yeah, it's like, uh, I, I've never had like the sports betting bug. I've, at points been like, I gotta give this a good shot. Like, it seems like a lot of people really like doing this. I gave it a shot, I could-

• 1:04:50John Coogan?

  I watched you, I watched you lose $200, and it was one of the most entertaining things.

• 1:04:56Jordi Hays?

  Yeah, so it was wildly entertaining, it was wildly entertaining for John, but for me, I was like, I was like, that's it.

• 1:05:02John Coogan?

  He's down to his last four cents, let's see what he'll do now.

• 1:05:05Jordi Hays?

  Yeah, I did get down to, I did get down to four cents, and then I was like, I'm gonna make it all back in one trade, and then the man lost.

• 1:05:12Alexis Ohanian?

  A hell of a parlay. Uh, like 20 different legs.

• 1:05:15John Coogan?

  Yeah.

• 1:05:17Alexis Ohanian?

  I, um, look, I, one of the things we've said around here is, we want to invest in things that we know can make, you know, generational size returns, uh, but also be things we're proud to tell our kids about. And so I have, again, I have no beef with betting or gambling. Uh, I think, I think in models where the house always wins, that does not stir my cocoa, because now you're just, you're just weaponizing sort of slot machine tactics to bring someone back who probably shouldn't be investing that next dollar, or gambling that next dollar. I think prediction markets are unique in that it is peer-to-peer, and I, I feel less distaste around, hey, someone made a better decision than you did today. Sure. Right? That feels more like any market. Um, but I do think overall, the worst toxicity that I've seen on the internet,

• 1:06:02Alexis Ohanian?

  when I, when I get, and it's, it's, I mean, it was jarring when I first started dating my wife. The worst toxicity that I would get was from psychopathic racists on the internet, and it was tied to sports betting.

• 1:06:14John Coogan?

  Wow.

• 1:06:14Jordi Hays?

  Yeah.

• 1:06:15Alexis Ohanian?

  And, and so, and tennis is a unique sport where there's actually always been a lot of sports betting, women's sport, where there's actually always been a lot of energy around it. And so even just anecdotally, it feels like athletes carry a disproportionate weight from it. And it might be easy to say, well, don't, don't check social media. But like, you guys, I mean, we all get our, we all get our hate. But like, if you're an athlete, like, you're literally just trying to do your job every day in front of everyone. We don't have to, our board meetings are not broadcast to the world. We don't, you, you already have to live every workday in front of every person on the planet. And if, if the downside of a shadow of sports betting and its rampant growth is even more toxicity for the athletes, like, that feels bad. And then there's the dystopian joke you made.

• 1:06:59Jordi Hays?

  I think it was like Holland's teammate who, you know-

• 1:07:01Alexis Ohanian?

  Yes, didn't pass the ball.

• 1:07:03Jordi Hays?

  Had a clear, sort of, should have passed it, but he's in the moment, you know, he's, he's gonna be a hero. And, uh, and yeah, he, he had more, you know, he just lost the World Cup.

• 1:07:16Jordi Hays?

  You know, not or not lost, but you know, lost in the in the quarters and he had like, you know, double the amount of comments as likes on on his last post, most of almost all of them saying like,

• 1:07:29John Coogan?

  And it's just very different when you're a fan, you're passionate about a team. Yes, you are upset about your favorite player.

• 1:07:34Alexis Ohanian?

  You're on the TV.

• 1:07:35John Coogan?

  Yeah, yeah. But it's different when people have money on the line, they are more incentivized to go crazy online and and send the aggressive message, which is never fun.

• 1:07:44Alexis Ohanian?

  Yeah. And I and I and I also just think from a health standpoint of our society, right? We know young men are more likely, right? We're risk takers biologically. And that's a great thing when it pushes us to go take an entrepreneurial risk. It is a less great thing when we invest our last hundred dollars on a parlay that's never going to pay off. And then it leads us into a cycle of addiction and problems. And so I I hope we can have a good conversation as a society about this. I know we're at a very like, let's say deregulatory time in America right now. And I hope when that switches, I hope it doesn't lead to a hyper regulatory period. But like, I hope we can have a reasonable conversation because I also I the the part that worries me the most is, we know we're going to continue to see more growth and acceleration for folks who are connected

• 1:08:29Alexis Ohanian?

  and plugged in. And that's going to be a great thing. It's going to give us lots of good stuff. If the folks who aren't feel even more disenfranchised and even more left out that there's this almost like, and you see parts of it flare up in crypto for sure. You see this sort of dystopian world of people willing to do anything to make a buck, that that that from a societal standpoint, makes me very, very, very uneasy. And and I like, it's it's becoming more and more obvious how big a role betting is, and particularly sports betting is. And I just feel like we haven't had the conversation. And I don't know if we have the folks equipped to have the right one. And

• 1:09:02John Coogan?

  Yeah, starting, starting.

• 1:09:03Jordi Hays?

  Well, I think Saturday's I think Saturday's event could be somewhat of a turning point with UFC because, you know, there's some, at least some, some like, potential, there's an idea that maybe there was people that knew there was a major injury going into that. And there was too much money on the line.

• 1:09:21John Coogan?

  I think we will have a national conversation about this. I'll give you 10 to one odds that it happens this year, by the end of the year.

• 1:09:28Alexis Ohanian?

  You guys are good.

• 1:09:28John Coogan?

  I also, I also heard an interesting stat that 99% of gamblers quit right before they hit it big. So if that really goes national, and people embrace the the statistic, I mean, it's just math, like, you know, anyway.

• 1:09:40Jordi Hays?

  We had a bet, we had a bet running too, that this this interview would go over because we always love talking.

• 1:09:45Alexis Ohanian?

  I looked up to you guys. I'm sorry it's been so long.

• 1:09:47John Coogan?

  Yeah, yeah, yeah. We'll do it again soon.

• 1:09:49Jordi Hays?

  Great to see you.

• 1:09:50Alexis Ohanian?

  Congratulations. I congratulate you all on Twitter, but congrats on the exit. I will still point out, as soon as I saw you guys watch,

• 1:09:57John Coogan?

  I know, I know. I need to apologize. I need to apologize. If you're like, yeah, we're a bunch of, you're a bunch of podcasters. Like, why would you want to invest in this?

• 1:10:04Jordi Hays?

  You saw, you saw it.

• 1:10:06Alexis Ohanian?

  You guys, you guys deserve every bit of it, though.

• 1:10:08John Coogan?

  Thank you. I appreciate that. Have a great rest of your day. We'll talk to you soon. Let me tell you about Cisco, critical infrastructure for the AI era. Unlock seamless, real time experiences and new value with Cisco. Our next guest is Morgan. How's always been on the show once, twice. I think this is his third time, fourth time, maybe fourth time.

• 1:10:26Jordi Hays?

  I think fourth. We've got a bet going now.

• 1:10:29Alexis Ohanian?

  You guys, how are you?

• 1:10:30John Coogan?

  Yeah. Can we start with sports betting? Is it an epidemic? How do you think? How how has the sports betting boom and the gambling boom and the hyper financialization worked its way into your your thought process and your work generally?

• 1:10:44Morgan Housel?

  I have two takes on this. One that's been talked about by a lot of people is that this well known idea in psychology that if you think all of your options in life are bad, you become very risk seeking. And so if you feel like you can go to, go to college, get a degree, work hard, get promoted by a house, you'll do that. If you don't, you'll start trading zero day options. That that that makes sense. I believe that. I could also argue the other side, which is that if my generation, my parents' generation or grandparents, if they had access to all of these things, they would have done the same thing. Like, it's not, it's just because we have these tools now that we're using them.

• 1:11:18Jordi Hays?

  Yeah, it's such a classic, like, the image of like a boomer in the Vegas, like, airport, just, you know, hitting, hitting the button over and over and over. It's like sort of like an iconic image in my mind. And I think that's proof to what you're saying, which is like, you know, if everyone had a casino in their pocket for the last hundred years, and probably every generation would have been gambling at a pretty high rate.

• 1:11:39Morgan Housel?

  We're the same. I mean, for my generation, when we were teenagers, the the new thing was was day trading. Because before that, you had to call your stockbroker and pay him $200 to make a transaction. Now you had E-Trade and Charles Schwab, you could do it for free or nothing. And so all of it, like, when I was 17, we all started day trading. Every one of us did it. It wasn't about the economy. It was just the tools we had in front of us.

• 1:11:59John Coogan?

  How do you think about loss aversion in the in the in the gambling, in the in the world where you're doing these like crazy parlays? Because there's been all these studies that show that people have more negative feelings about losing money than than the good feelings that come from making money. This general idea of loss aversion, if you if you lose $10, you're going to feel more pain than the joy that you would equivalently feel from gaining $10. So people are generally loss averse. And yet gambling seems like a formula for like endlessly triggering that loss aversion. And yet we don't see that actually play out.

• 1:12:38Morgan Housel?

  And then you also have this other concept of house money, where like, if you do win, it doesn't, it's not your money that you earned from your paycheck, and you're much more likely to take higher risk from it from there. And you see it with loss aversion in people's lifestyles as well. If you go from a Honda Civic to a BMW, it feels pretty good. If you are forced to go from the BMW back to the Civic, it's the worst feeling you could ever possibly imagine. Will Smith talked about this with fame. He was like, becoming famous is amazing. Being famous is okay. Losing fame is the is the hardest pain you could ever experience. And so I think there's a lot of things in life that are like that, where you're taking risks, and particularly like investing when you know as a matter of fact that you're going to have losses, that's just, that's just coming with it. And if the losses are going to feel 10 times worse than than your gains,

• 1:13:22Morgan Housel?

  it's going to be, it's going to be tough. There's so many of like, the best hedge fund managers, stock traders, the people who've actually done extraordinarily well over years and decades. And you look at their track record, and they might be right 55% of the time. It'd be like 65% of the time, if they're incredibly good at what they do. And so really, what their their skill is, is they became very comfortable and level headed, losing money. That was how they made money over time, was paying the cost of admission of just dealing with that volatility and loss.

• 1:13:50John Coogan?

  Yeah, I've I've been disappointed that a lot of the folks that I know that participate in gambling, refuse to take my advice and invest in the gambling companies, just buy the house. Because some of the, some of the gambling stocks, you know, you like the industry, hate the industry. But some of the gambling stocks have been very performant. And it's, it feels like it should be the solution. And yet, it doesn't have the same psychological impact of the the quick, quick wins that come from actually playing. Shifting gears a little bit, I wanted to ask you about the the publishing industry, the nonfiction industry. Tim Ferriss put out a blog post asking the question, has AI already killed

• 1:14:35John Coogan?

  how to nonfiction? And he tells a story about his, his books. And he says that on on the 2026 run rate, he's down 57% on on sales of books. And he sort of attributes that to some of his books being substitutable with LLMs. Just the idea that if his chef, four hour chef book was a bunch of recipes, and you can get those directly. And I'm wondering about how you think the the publishing industry, the book landscape, there's also this piece in the Atlantic about people just not reading at all anymore. What are you thinking about where we are right now in terms of the publishing industry and where we're going?

• 1:15:17Jordi Hays?

  The only thing on Tim Ferriss,

• 1:15:18Alexis Ohanian?

  The piece in the Atlantic.

• 1:15:19Jordi Hays?

  Yeah, the only thing I was gonna say is like, the the decline in sales like coincides with him just putting way less time into his podcasts.

• 1:15:26John Coogan?

  Oh, sure. So he's maybe driving less sales.

• 1:15:28Jordi Hays?

  So so like, you have to imagine him not fully pricing in just having one of the biggest podcasts in the world.

• 1:15:35John Coogan?

  Yeah.

• 1:15:36Jordi Hays?

  And then, and then just slowly doing, like, you know, more competition, plus putting less emphasis into it. But

• 1:15:44Morgan Housel?

  I think I think you're probably on to something there. I was going to point out Mel Robbins, whose book will sell eight zillion copies this year. That's that's nonfiction self help. It's the exact same genre. And she's blowing the doors off right now. And so I think for every example that you put in, what's true is that the book industry as a whole, and particularly nonfiction, has not had a very good three or four years, a lot of which was because 2020, 21, COVID lockdowns was just an explosive bonanza that everything by comparison to then is is not that great. But I think there's a there's a thing, too, with with podcasts and long form writing and books where it's easy to say that people don't have attention spans these days. They want short form video, and that's they just want to flip through it, and that's it. And it's like, no, the

• 1:16:28Morgan Housel?

  biggest podcasts in the world are like, three hour conversations that people listen to all the way through. And so I think it's not that people don't have attention spans. They don't have a lot of tolerance for BS in the way that they used to. And so I think 30 years ago, people would slog through a bad book because they had nothing else to do that day. Whereas now, if you start a book and it's bad, you're like, I got 20 other things competing for my attention over here. I'm going to go there. And so if you're still putting out the kind of content that is engaging and interesting and saying something new, people will buy it, they'll listen to it, they'll put effort into it, they'll listen to it for hours. That's that's still there.

• 1:17:02Jordi Hays?

  Yeah, it's crazy how captured audiences were 30 years ago. Like you, or let's say like, pre internet. But it's like, if there's nothing on TV that you're excited about, there's nothing on radio that you're excited about, and you don't have a book physically in your home, and it's like 8pm, like, you're kind of like, just choosing between Options that you're not that excited about, but then now it's like truly infinite possibility. No one, I don't feel like people are bored anymore, right?

• 1:17:32John Coogan?

  Yeah.

• 1:17:33Morgan Housel?

  Yeah. And I think it's, I think there's, there's a lot of times when people, what they think is impatience is actually just a newfound intolerance for BS in content. I think there's a lot of that.

• 1:17:42John Coogan?

  Interesting. Yeah, I was in a bookstore recently and the, the, the power law of publishing is fully on display because you walk in and the, the, the Mel Robbins book, for example, will be shoved in your face with a massive display and tons of copies. And then if you're actually looking for a book, you have to find the section and it's much harder to dig through. They might not even be in stock. And I would, I would have assumed that the internet would sort of flatten that and lift the tail, but I guess there are power laws everywhere. And so certain books go viral. What I'm interested in is, is this idea of like, there are certain, there are certain authors that publish a book every year and they sort of just base hit, base hit, base hit. And then there's another version of that playbook, which is

• 1:18:24John Coogan?

  have one really defining book, but then continue to franchise it, promote it, add on to just continue to drive sales. And I think that's what Jordy was alluding to a little bit about. You have a podcast and you can drive sales to your existing catalog, even if you're not publishing new books.

• 1:18:39Morgan Housel?

  Yeah, I think that power law exists even among the tippity top authors. Stephen King has written like 50 books, something like that. And most of his sales and most of his fame came from like three. So even among, and like you have people like Michael Lewis, who's written, I don't know, I'm going to guess like a dozen books, something like that. And I bet most of his income, sales and fame came for two or three of them. And so some people have a better hit rate than others, but even among the best, I listened to an interview yesterday with Matt Damon, same thing in movies. He's made dozens of movies. Most of us watching this have never heard of before. And so that you see that, you see that everywhere. I remember James Clear telling me several years ago, there's four million books for sale on Amazon. And if you look at the top five, the top five of the four million, it's possible that number one is selling 10 times as many copies as

• 1:19:23Morgan Housel?

  number two. So even as like it's a four million thing, and even among the top, this, the, the power law just gets crazy.

• 1:19:29John Coogan?

  Yeah, I think it's the same thing with, with podcasts. I think Rogan is like an order of magnitude bigger than everybody else, at least on Spotify. Jordy can't name a single Matt Damon movie.

• 1:19:40Jordi Hays?

  Or an identity.

• 1:19:41John Coogan?

  There you go. Oh yeah, that, that is the series that you like. Matt Damon also famously passed on Avatar. And he was like, you would have made so much money from that. But James Cameron said like, the movie, it's not a Matt Damon vehicle. It's a, it's just a, it's a movie that the idea exists regardless of.

• 1:19:57Jordi Hays?

  Has there been, has there been a book written on the power law? Not the, the venture book, the power law, but the book on just like every single place that the power law? Cause I'm wondering like, is, does power, power law apply to marriages where like the best marriages are actually 10 times better than, you know?

• 1:20:17Morgan Housel?

  I would assume, I would assume it does. I think it's one of those big things that's going to influence everything in life. And it throws a lot of people off because it's like, you can be extremely good at what you're doing. Like if you are a really good college basketball player, you might be significantly like, there's the, the difference between that. I, what, what was the story I'm thinking of? It was somewhat, it was an NBA player that people were harassing because he, he was having a really bad season. And he went on a podcast and he was like, the difference between me and you is so much bigger than the difference between me and LeBron. It was like, it's like, once you get to that level, like the, and so I, you, you, you, you see it everywhere.

• 1:20:55Jordi Hays?

  But couldn't you make the argument that no, the difference between you and LeBron is actually, is actually, I guess it's, the difference still could be bigger, but it could be.

• 1:21:07Morgan Housel?

  I mean, I, I, I don't, when, when I was, my, my sport growing up, I was a ski racer. And if you were a really, really good regional skier, you were not in the top hundred nationally and you were not in the top thousand internationally. It just, it got, and I think it's, it's, it's like that for most sports.

• 1:21:23John Coogan?

  The closest book to what you're thinking of is Algorithms to Live By, The Computer Science of Human Decisions by Brian Christian and Tom Griffiths. It takes well-known computer algorithms and then applies them to everyday life. So a good example is the 37% rule for choosing. This is like known as the secretary problem, but when selecting amongst a fixed number of options, apartments, job candidates, even potential partners like marriages, spend the first 37% of your search observing without committing, and then choose the next best option that is better than everything you've seen before. And you will almost, you'll be like mathematically optimal. And it takes all these different algorithms and applies them to everyday life. It's a fun book.

• 1:22:07Jordi Hays?

  With, in parenting, are you, do you spend any time thinking about, or trying to identify where, where your children might have, might be 10 times better, or the potential to be 10 times better at something than their, than their peers? Cause I look at this between, between my children, even, even looking at athletic abilities, I think it's already like completely noticeable who's like the better, at least natural athlete. And I believe that that will probably carry through, throughout their whole life is my, is my intuition, not to say one.

• 1:22:43Morgan Housel?

  Here's my, yeah, I, I, not, not for my kids. Let me tell you a story. When I, so I was a skier growing up and for my generation, there were two skiers who became head and shoulders above everyone else. Lindsey Vonn and Ted Liggett. They both won Olympic gold medals. Everyone knows Lindsey Vonn now. When Lindsey Vonn was six years old, she was in a different universe of everyone else, of, of, of talent. She was just, it was so obvious from the time she was a small kid that she was just the best out of anyone. Ted Liggett was not that. He didn't hit his stride till he was like 18, which was so, so rare. And so I always, it's, it's, it's always interesting that yes, there are some people from like, from a very early age, Tiger Woods was on TV golfing when he was like two, as, as a talented golfer. And so there's that, but there's also these people that just don't hit it until late in life. And those are always interesting. A lot of entrepreneurs

• 1:23:28Morgan Housel?

  like that, that don't really find their stride until they're 30 or 40.

• 1:23:31Jordi Hays?

  But with Ted, is it possible that he just didn't care enough until he was late in his teenage years? And prior to that, like he was always that good, but just never put the effort in or the time?

• 1:23:43Morgan Housel?

  I think this is, this might bore some of you, but I think it's so fascinating. One of the things with Ted is that there are rules abound the kind of ski gear that you can use for racing. Like they have to meet these, these sizes and whatnot. And they changed the rules at one point so that your skis had to have a certain side cut. Ted was the first person in the world who figured out how to ski on the new skis. And he just completely dominated everyone else for several years after that, before they kind of caught up. So there's, there, there, there's some of that that was interesting. But I think for, I think that's the rare one. I think to your point, the Lindsey Vonn story is more common when from a young age, they are just so preposterously better than everyone else.

• 1:24:19Jordi Hays?

  Yeah.

• 1:24:21John Coogan?

  I want your reaction to this chart that Joe Weisenthal, friend of the show, shared. And we, we'll have the team pull it up. It's the percentage of US household net worth over time. And for a long time, real estate was the dominant place where American households held their net worth. But for the first time, we are seeing that households are increasingly holding equities. Cash and cash equivalents peaked in the eighties and is sort of declining around 10% of household net worth, but equities have been completely up and to the right. Maybe it's just a temporary dislocation in the stock market. The stock market's doing

• 1:25:02John Coogan?

  very, very well. Houses are more expensive, so households are preferencing that. But I'm interested in your take on what this says about US households, but also the psychology of what it means to hold a, you know, a larger percentage of your wealth in equities versus your house.

• 1:25:22Morgan Housel?

  Yeah, we also talked about like the stock market crash in 1929. And, and I think the, the statistic was 5% of Americans owned stocks in 1929. So we had, like, we, we talk about it as like it started the great depression, but it was, it was such a small number of people that actually got hit by that. Whereas today, I think the stat is 55% of Americans own stocks, the vast majority of them in their 401k. Now, and, and part of that, like, if you're an investor for the long term, the odds that you're going to experience a 30% decline, or even a 50% decline are, are almost a hundred percent. That's just how markets work over time. And does the, do, does the general population of just like ordinary Americans who are not watching this and listening to finance podcasts and reading finance books, do they have the stomach for that? Or do, do they even know that that's

• 1:26:06Morgan Housel?

  the game that they signed up with, for? I think by and large, the answer is no. And even if you do know it, knowing it and experience it and in real time can be completely different. The one thing is that like stocks have been over time. Nothing is promised in the future, but generating real growth above the rate, like well above the rate of inflation. Real estate is something completely different, where particularly if it's the house that you live in, not a rental that you have. I, I think we've done a lot of damage to Americans by convincing them that rising home prices are a good thing and they make them wealthier. And it is such flawed math, because if you buy a house for 500 grand and then sell it for a million, how much money did you make? Well, for most people, once they sell it, they have to buy another house that also inflated in value by two X over the last

• 1:26:49Morgan Housel?

  same period. It's like you didn't, probably didn't make anything. And so I, I think there's a lot of like, it looks like wealth on paper with real estate, but it's just a place to live in. And you have to exchange it for another place to live in. And you didn't really make that much over time. So maybe if we're talking real wealth over time, it's a much better situation that we're, that we're in now.

• 1:27:06John Coogan?

  Yeah, I am interested about, I mean, I, I know some people who bought in Mill Valley like years ago, decades ago, just because that was a logical place to buy and it was a nice community. And of course, the house prices are insanely high with the AI boom, with San Francisco booming. But there isn't a logical like, oh yeah, of course they'll move to Florida at some point, because that's not really what people do culturally. If you are in California, you sort of just retire in the town that you grew up in or live in, raised your kids in.

• 1:27:35Morgan Housel?

  If you can do that, if you can sell a Mill Valley and move to Oklahoma, that's great. That's real wealth. But if you sell a Mill Valley and buy a Mill Valley, you can make anything.

• 1:27:42John Coogan?

  You're not doing anything. What, how do you, how are you, do you ever think about like the different prescriptions for solving the housing crisis? We're having Saagar and Jetty on the show tomorrow to talk about it, but I'm interested if there's, if there's anything that you have, that you've dug into, whether it's through the abundance or permitting or anything that's stuck out to you as particularly exciting around the way America deals with housing broadly?

• 1:28:11Morgan Housel?

  I think, I mean, it's simple, but it's, but it's not easy. It would, it would be around permitting and building more. There's obviously demand for more. There is the ability to build more. It's just that in the vast majority of cities, it's virtually illegal to build where people want to live, or at least extremely difficult. And it's one thing to say, you know, build more homes. It's another, if you're a home developer in California and you want to go build 200 homes, you're going to be waiting in line for years and paying a fortune to actually build that, if you can actually get it done.

• 1:28:38John Coogan?

  Yeah.

• 1:28:39Morgan Housel?

  And, and so I think the idea that, you know, there's a great saying by Connor Sen, who's a great thinker around these topics, and he says, "The future is a policy choice." And the reason that home building is so scarce and we don't have enough homes is because we've made a choice to be in that situation. There's no, if you were left to its own devices, it would be solved not that, you know, in, in due time. We did this similar situation at the end of World War II, when you had 16 million soldiers come home, there were not nearly enough homes for them.

• 1:29:07John Coogan?

  Yeah.

• 1:29:08Morgan Housel?

  But at the time, it was much easier to build than it is today. And so you had things like Levittown that sprung out of the middle of nowhere, and they were building 25,000 homes in a year. And you solved the problem in due time. And so it's, it's simple, but just politically much more difficult to say, like, yes, I, I think by and large it's permitting. It's not, it's not an exciting answer, but we've made the choice to make it difficult to build where people want to live.

• 1:29:31John Coogan?

  Yeah. For, for those who don't know, what, what is the actual story of Levittown? And can that be replicated today? I was, I was in Irvine, and it feels like a very planned community. Of course, most of that town was built maybe 100 years ago, but it, just driving around and seeing so many apartments and houses, it felt like this could be replicated, but I don't, I'm not exactly sure how far.

• 1:29:55Morgan Housel?

  Yeah. I mean, it was, it was, it was the end of World War II, and there were, like I said, there are all these soldiers who needed homes. And by, like, most of them, a lot of them moved back in with their parents.

• 1:30:02John Coogan?

  Sure.

• 1:30:03Morgan Housel?

  Which is not what you wanted to do coming home from war. And the Levitt brothers were home builders. They started buying up abandoned farms in New York and Pennsylvania. And they basically took what Henry Ford figured out for cars, which is like, you have to make the manufacturing process like very step by step. And every person has a specific step that they do all day long. And they, they made very small, very cheap, not high quality homes, but they could just bang out tens of thousands of them.

• 1:30:28John Coogan?

  Yeah.

• 1:30:29Morgan Housel?

  And, and it, it, it, between that and like the GI Bill that helped finance a lot of those homes, I don't think it's an exaggeration to say, like, it saved that generation who came home and had nothing, and within a couple of years, allowed them to have a good dignified life going forward.

• 1:30:43John Coogan?

  Yeah. I've been surprised that we haven't seen more spreading out of, basically like longer commutes or longer distance commutes, because we're on the cusp of self-driving cars. Even just a basic Tesla Model 3 has self-driving that can make an hour-long commute much more.

• 1:31:03Jordi Hays?

  Palatable.

• 1:31:04John Coogan?

  Palatable. And then you also have telecommute, and a lot of companies have like a work-from-home Friday policy or some flexibility around that. And I was expecting that there would be some alleviation from the pressure. Like, when I look at the home prices in San Francisco, and then I compare them to the, or the rental prices in San Francisco, $4,000 for a one-bedroom, and then I look over in Oakland, I'm like, I, I'm surprised that we're not seeing more flattening out. But I think that there's still a huge demand for being in the action in a particular area, in a particular town, and even in a neighborhood. And so there's been a lot of pressure on like the, the highest value areas. I don't know.

• 1:31:43Morgan Housel?

  I'd say that there's also been a big inflation of expectations over time, which is what you want in society. You want people to expect, to expect a better life. But when you talk about Levittown, the houses that they were building back then, that were so great for middle-class Americans in the 40s and 50s, would not be considered a livable house today. It was, it was 800 square feet for your four or five kids who all shared one bedroom. You had one bathroom for the six of you, no garage, no deck, no air conditioning, like, go on down the list. Most people would not consider that an acceptable place today. And again, I always, whenever I point that out, I have to say, I want to live in a world where people have higher expectations over time. That's progress.

• 1:32:19John Coogan?

  Yeah.

• 1:32:19Morgan Housel?

  But it's not comparable over the generations.

• 1:32:21John Coogan?

  Yeah. Jordy?

• 1:32:22Jordi Hays?

  I do too. But at the same time, when I moved to the city that we're in now, I had an extremely long commute and a terrible apartment. And

• 1:32:36John Coogan?

  I had a real roommate at one point.

• 1:32:37Jordi Hays?

  And I, and I think it's just, I think, I think it's

• 1:32:40John Coogan?

  Well, and I think it's, I think it's like, because the life that people want is immediately

• 1:32:46Jordi Hays?

  available on social media to them to view at all times, there's, I think, like a decreased ability to delay gratification. Because I remember growing up, I'd travel to somewhere, and I'd see like a really big yacht, and I'd be like, wow, that's like, you know, pre-internet. You're like, oh, I've never, you know, well, I guess it's not pre-internet, but like, you know, there wasn't like, the first time I saw a yacht, I'd probably never seen like an Instagram video of some athlete doing a backflip off of it. I was just like, oh, that's a totally different, like, life.

• 1:33:15John Coogan?

  At the same time, like, I watched MTV Cribs and stuff. I don't know.

• 1:33:18Morgan Housel?

  Yes. I was just, I was just going to bring up MTV Cribs, which had such a profound cultural impact. I'm imagining it, because that was the only view into how the other half lives. But, and it was, I, I loved, I watched every episode of that show when I was younger.

• 1:33:29John Coogan?

  Wow.

• 1:33:30Morgan Housel?

  But what's, but was, but what was so important about it is that you did not consider those people peers. You're like, that's, that's, that's Master P. Of course, his bathroom is made out of marble. Like, that's not a peer of mine.

• 1:33:40John Coogan?

  Sure.

• 1:33:41Morgan Housel?

  Whereas today, on social media, you see the yacht, and you see the person, and you're like, that guy, like, he, he's supposed to be a peer. Like, I'm supposed to be there.

• 1:33:48John Coogan?

  Yeah.

• 1:33:49Morgan Housel?

  And so the fact that it was an obvious celebrity or an athlete, and that like Shaq had a 12-foot bed, you didn't expect to have that yourself.

• 1:33:55Jordi Hays?

  My favorite, my favorite example is like, the GT3 RS is like the most, you know, if, if you ask like a 21-year-old guy, "What car do you want?" If you just get any car right now, a lot of them would say GT3 RS. And so that's my favorite example when talking about personal finance with, you know, people that I know in my life that are just starting their careers, is I say like, "You know that car that you see, and you just assume like if you work hard, you'll like be able to, you know, get a GT3 RS, because that's a car you want to drive on the weekend?" Well, you need to make, if, if you want to buy that car, you basically need to make $850,000 in one year in California, and be willing to spend the entire amount after taxes that you make just on that car, and not have any

• 1:34:38Jordi Hays?

  other expenses for the year. So that is what that car, that is the actual cost of that car, but it's just like put into their face all day long, to the point where people just assume like, okay, like, if I work hard and I do a good job in life, I, I should be able to get a GT3 RS. And it's like, it's just so normalized.

• 1:34:54John Coogan?

  I just found one for, I just found one for 50K. It has, this is on a salvage title.

• 1:35:00Jordi Hays?

  [laughing]

• 1:35:01John Coogan?

  It, it has six owners, Florida. It has aftermarket wheels, but it's doable. It's doable.

• 1:35:09Jordi Hays?

  Okay.

• 1:35:09Morgan Housel?

  You have, you have, you have to pull it out of the way.

• 1:35:11Jordi Hays?

  So if you make six figs.

• 1:35:12John Coogan?

  Yeah.

• 1:35:13Jordi Hays?

  And then you spend your entire salary after taxes.

• 1:35:16John Coogan?

  It's only had four accidents. Only four accidents.

• 1:35:17Jordi Hays?

  Anyways.

• 1:35:18John Coogan?

  Still runs.

• 1:35:19Morgan Housel?

  Now, as you say, I think, I think tech has, has done so much to expectations over time. I was, I was in Tahoe this week with my family, where I grew up, and we were driving past, and the biggest, most beautiful house in town, this mansion, it's so beautiful. And I told my wife, and I said, you know, the, the people who, who lived there when I lived here back in the 90s, that was an orthopedic surgeon. And we're like, there is no way an orthopedic surgeon could afford that house today. That house would be a tech CEO's house. But back then, orthopedic surgeon was the highest earner in town. There were, there was, there were no product managers at Google making 850 back then.

• 1:35:51John Coogan?

  Sure.

• 1:35:51Morgan Housel?

  And so it, it created what we used to think of like, jobs that every town has, dentists, doctors, lawyers, those kind of things, used to be number one. Now they're number 47 on the earners in town.

• 1:36:02John Coogan?

  Now you gotta do orthopedic surgery SaaS. If you're the founder of an orthopedic surgery SaaS product, then you get the house. It's the same thing.

• 1:36:10Morgan Housel?

  Exactly.

• 1:36:11John Coogan?

  Or dental SaaS or something like that. Yeah. No, it really has been like a crazy, crazy boom, and it's driven up everything all over the place. Jordy, anything else?

• 1:36:20Jordi Hays?

  Do you ever plan to retire?

• 1:36:23John Coogan?

  Hmm.

• 1:36:24Morgan Housel?

  I don't, I, I think it, it depends. I, I always think like the purpose of financial independence is to get to choose your problems, because you're going to have problems either way. And I, I was talking about this with someone earlier, of people who've sold their business. I don't know if you guys know two people who've sold their business recently, I don't know. But the, the number of them who went on to regret it, and the reason is, this won't, won't apply to you guys, is because they left their business, and they realized on day one, like, that was their purpose.

• 1:36:51John Coogan?

  That was their purpose.

• 1:36:52Morgan Housel?

  And, and once they lofted, that was their identity. And they woke up the next morning with tons of money and no purpose. And I always say, like, if you think work is hard, try boredom. It's way harder. It is way more psychologically taxing than hard work. People want good problems in life. And so retire, no, I, I'll, I'm doing, I, I work very differently now, and do a different level of work, less work, than I did five years ago. But I'm still doing things to keep myself busy, because if I didn't, I would slip into boredom and then probably depression very quickly. So I guess to answer your question, no.

• 1:37:21John Coogan?

  Yeah. Yeah, there's some formula. It's like how much you should invest in bonds is like your age minus, 100 minus your age or something. It's like, how much free time you should have should be like 100 minus your age. So when you're 20, you're working 80% of your waking hours, but when you're 50, you're taking half the time off or something. I don't know. There, there's some, like, you know, you want to have some sort of balance. You probably can't go 100-hour weeks into your 80s unless, I don't know, maybe somebody will, but.

• 1:37:50Morgan Housel?

  It's a big problem, because in finance, we spend so much effort making sure people have enough money to retire, and focusing on that number, and no time whatsoever asking questions, "What are you going to do once you're retired?"

• 1:38:01John Coogan?

  Sure.

• 1:38:02Morgan Housel?

  And for a lot of people, they retire, they got plenty of money, they saved their whole life.

• 1:38:04John Coogan?

  They don't know what to do.

• 1:38:05Morgan Housel?

  And then after two weeks of retirement, they wake up and like, "Who am I? I, I don't even know what I am anymore. What's my identity? What's my purpose?" And if they retire at 60, they might have another 40 years to live.

• 1:38:15John Coogan?

  Yeah.

• 1:38:15Morgan Housel?

  Like an entire extra life to live, doing nothing.

• 1:38:17John Coogan?

  Yeah.

• 1:38:19Jordi Hays?

  Long time.

• 1:38:20John Coogan?

  Nürburgring track time, sub seven minutes, make it happen.

• 1:38:24Jordi Hays?

  That'll be, that'll be John.

• 1:38:26John Coogan?

  That is.

• 1:38:27Jordi Hays?

  It'll be the, it'll be the 80 year old on the, on the track.

• 1:38:29John Coogan?

  Shaving off milliseconds.

• 1:38:31Jordi Hays?

  All right, grandpa.

• 1:38:32John Coogan?

  I don't think it's, I think I'm too heavy. I think I'd have a disadvantage forever. I don't know. Maybe I, I.

• 1:38:37Morgan Housel?

  Let me, let me flip that around to you guys, young guys, successful, sold your business. Do you think you'll ever retire?

• 1:38:42John Coogan?

  No.

• 1:38:43Jordi Hays?

  Absolutely not. I saw my, my, my late grandfather was sharp as a tack until about three months after he retired. And I think that, um, I think that the daily habit of just putting, putting in work, you know, using, using his mental capacities.

• 1:39:04John Coogan?

  Yeah.

• 1:39:05Jordi Hays?

  Um, was contributing to, was contributing to his longevity. And to me, to me, the, you know, building companies is like an act of creation and there's nothing as, as satisfying or enjoyable to me in this whole world than creating.

• 1:39:22John Coogan?

  Yeah.

• 1:39:23Jordi Hays?

  And so to me, it's like, it's like, you know, you're asking an artist, like, do you think you'll ever stop, like, you know, making art? It's like, yeah, you might, you might dial it back. You might do these different things, but, no, I'm, I'm so fascinated, uh, to, I, I, I like, I like to imagine like, if I was 80 years old right now, living the same life, what, what would I be choosing to work on? What, what ideas? And I, I think they'll be quite, uh, I think they'll be quite different than the things that are interesting to me now.

• 1:40:00Morgan Housel?

  Yeah.

• 1:40:00Jordi Hays?

  But I look forward to figuring out what they are.

• 1:40:02Morgan Housel?

  There are some fields that I really admire when people quit while they're ahead. Whether it's like Seinfeld in 1998 shows on top of the world and he's like, no, we're done. That's, I've given it all I want to, we're out of here. But he didn't retire. He's, he's still on tour today doing a million other things.

• 1:40:16John Coogan?

  Yeah.

• 1:40:17Morgan Housel?

  And so the, the, the ability to say like, I could probably squeeze more juice out of this career, whatever that career might be. But I'm proud of what I've achieved and now I'm going to go do something else. It's not retirement, but I admire that versus, you could easily imagine a history where Seinfeld went another 10 seasons and it sucked. And it just kind of like died on the vine. You could easily imagine that history, which is kind of what The Simpsons have done over the last 20 years, right?

• 1:40:41John Coogan?

  Interesting.

• 1:40:42Morgan Housel?

  And so I, I, I really like when people quit while they're ahead. I think it's really admirable.

• 1:40:46Jordi Hays?

  There's also something, there's like a kind of business that can only be started by someone who doesn't need it to work. Basically, and you see this with startups where like, you know, an entrepreneur will have an exit and they'll start working on something and then they'll just be toiling in obscurity for years and, and, you know, um, and, and eventually they can build something valuable out of it. But a young entrepreneur wouldn't necessarily do that because they're like, I have to, I have to make the SaaS so that I can raise the next round. So I can, you know, do all these different things. And so, um, I also think it just changes. When you, when you have like, if you can set yourself up to be able to take more risk, there's interesting businesses to be built.

• 1:41:32Morgan Housel?

  Yeah. I forget who said this years ago, it may have been Mike Solana, I might be getting that wrong. But he said like, the number of founders, founders that he's met who sold their business, cashed out, and then they said, I'm going to take two or three years off to just chill and ski with my family and hang out, and then I'm going to come back. And they come back after three years. And I think the way he phrased it was like, every one of them is so smooth brained at that point. Like you just lost it. Like you just atrophied. They lost the edge of what you had. And so the idea too, that, um, it's a muscle that you gotta keep going or else it's, it's just going to wither away is, is important too.

• 1:42:04John Coogan?

  Yeah. Yeah. It seems like the, there are, there's like a different set of challenges that the post-exit founders can take on that, that, that works. But i- if the, if the business requires like having really, you know, like, like firm contact with, you know, a large swath of consumers and you haven't been to the store in four years because you now have a personal shopper, like you might be out of touch there. But if you're solving some sort of problem on the like geopolitical level, marshalling billions of capital. And it's like, that was an opportunity that was only open to you after you exited, then that becomes something that's, you can accelerate into a little bit better. Uh, but it's, it's, it's sometimes hard for people to go back into the garage.

• 1:42:50John Coogan?

  If the, if the startup idea requires those like garage years of like prototyping something at a very low level. And like going zero to one on something that's so niche and so requires contact with like, you know, broad reality.

• 1:43:04Jordi Hays?

  What do you think the value of vacation, vacations is? Because to me, like I went, I went like, uh, I basically, you know, I'm 30 now, my twenties. I probably didn't take, you know, more than a, uh, four days off, you know, at any point in my twenties. And I used to think like, wow, I'm stressed. I should like get away and like, but ultimately that would just try to create, that would, in my experience, create more stress. Cause I'm like, the thing that is causing stress, I'm not addressing head on and, and, uh, solving. But I'm curious in your life, what you feel like, you know, what benefit you feel like you get

• 1:43:47Jordi Hays?

  uh, from vacation, because I don't think like stressed people going on vacation like solves stress.

• 1:43:53Morgan Housel?

  No, if anything, it's because if they actually detach on vacation, then they come back and they have 47,000 unread emails and just more problems piled up in there.

• 1:44:00Jordi Hays?

  Yeah. Detaching is not necessarily even healthy to be like, I'm just going to ignore the problems in my business or whatever for four days. And then it's like, you may as well just go on a bender or something like that, you know?

• 1:44:11Morgan Housel?

  Yeah. But I would do think it's true is that for a lot of people, the reason that they actually go on vacation is because they have to travel somewhere else in order to justify detaching. If they just stayed home and detached, they would feel some sense of shame. But if they're like, oh, we're going to Maui, so now I'm going to detach. It gives them the excuse to do that. Cause like, is being in Maui actually that much better? Than being back at home? Like, there, there are aspects of it. But I think what you really enjoy is giving yourself permission to be someone else and to be on a different schedule that you could not bear if you were just staying back at home. My wife doesn't like traveling. She's totally, uh, she likes, she likes being at home. And I think this is part of her philosophy of like, people don't actually like traveling. They just don't like being at home. And if you enjoy being at home, your desire to actually do it really diminishes.

• 1:44:56Morgan Housel?

  I travel a lot for work, so I don't have a ton of desire to, my, my idea of a vacation is not, not getting on a plane this week. Um, but I think, I think it tends to be true. I, I've used this example before of like, if I'm building sandcastles with my kid on the beach in Maui, and that's a 10 out of 10, being at home, playing Legos on the living room floor is at least a nine. Like what I actually enjoy is, is time with them. It's not flying for seven hours and spending 10 grand on the trip. It's spending uninterrupted time with the family. But back to the original point, I think you have, some people have to vacation in order to have uninterrupted, uninterrupted time with their family. It's impossible any other way.

• 1:45:31John Coogan?

  Yeah.

• 1:45:31Jordi Hays?

  Yeah. When, uh, after kids, the idea of like a, a seven day trip to Hawaii. I'm like, so you want me to go through two days of just like pure chaos and suffering for everyone in the family where the kids are uncomfortable because they're going to the airport and they're in the airport and they're on a plane and they're waiting around. And then, and then it's like, sort of, you bookend the experience. And so you're like, you come out of it not necessarily, like to me, I, cause like, I don't come out of trips feeling like.

• 1:46:05John Coogan?

  Take a boat, turn it into a three month trip.

• 1:46:07Jordi Hays?

  There you go.

• 1:46:07John Coogan?

  It's probably better.

• 1:46:08Morgan Housel?

  My wife, my wife has this thing too, where she says, the best part of every trip is coming home. And I think when we do go on vacation, it gives her a newfound appreciation for home. After you've been in a tiny hotel room and then you come home, your kitchen feels like it's the biggest thing in the world. The bathroom feels like it's the biggest thing in the world and you appreciate what you already have more. We were joking last night, not seriously, but we were like, we should intentionally take worse and worse vacations. We can appreciate home that much more.

• 1:46:31Jordi Hays?

  Wait, we, we have a, we have a buddy who at least historically would, uh, take a, like get a round trip flight over the course of a day if he needed to work on something. So he would, he would like just fly to some random, like basically book like a $200 round trip ticket.

• 1:46:49John Coogan?

  Lock in.

• 1:46:49Jordi Hays?

  And just to get like something done that they were avoiding.

• 1:46:53John Coogan?

  Wow. That makes, that seems like there's much easier ways to do that. Drink a coffee or something. Anyway, thank you so much for coming on the show, Morgan. Great catching up.

• 1:47:00Jordi Hays?

  Yeah. Great to see you.

• 1:47:01John Coogan?

  Have a great summer. We'll talk to you soon.

• 1:47:03Jordi Hays?

  You're the man.

• 1:47:03John Coogan?

  Let me tell you about console.com. Console builds AI agents that automate 70% of IT, HR and finance support. Giving employees instant resolution for assets, requests and password resets. And let me also tell you about CrowdStrike. Your business is AI, their business is securing it. CrowdStrike secures AI and stops breaches. Well, we have Mark Gurman joining the show in just a few minutes.

• 1:47:26Jordi Hays?

  You say the Germinator?

• 1:47:27John Coogan?

  The Germinator is back in the Ultra Dome, getting us up to speed on what's happening in the thermonuclear war between Apple and OpenAI. And so he is here. Let's bring in Mark Gurman, the Germinator himself, to take us through his excellent reporting. As always, congratulations on the scoop. Take us through it. Friday, what was your day like? What happened? What's the headline?

• 1:47:52Mark Gurman?

  Friday was great, you know, end of the work week, but for me, there's really no end. It's Monday, Tuesday, it's the whole week, seven days, 24/7.

• 1:48:01John Coogan?

  Yep.

• 1:48:01Mark Gurman?

  Uh, Apple suing, or yeah, Apple suing OpenAI. I didn't find it to be that big of a shock. I think things have been brewing uh for several months. This was a two-year relationship that went south pretty much in the first year.

• 1:48:20John Coogan?

  Okay.

• 1:48:21Mark Gurman?

  Uh, I think it was doomed from the beginning, we can get into that.

• 1:48:24John Coogan?

  Yeah.

• 1:48:24Mark Gurman?

  But OpenAI had been pillaging Apple's hardware engineering ranks, uh, cloud department, uh, many other aspects of the company for over a year. Four hundred people hired by OpenAI. And people move between companies all the time.

• 1:48:44John Coogan?

  Yeah.

• 1:48:44Mark Gurman?

  But one company hiring four hundred people from another company in such a short period of time.

• 1:48:50John Coogan?

  Yeah.

• 1:48:50Mark Gurman?

  It's absolutely insane.

• 1:48:51Jordi Hays?

  And Apple, and Apple, even with all the, the competition, we talked about it from like Amazon and Microsoft and Meta has never gone through this kind of, they've never been pillaged in this way.

• 1:49:03John Coogan?

  Yeah, it's not like, it's not like Bezos got four hundred people from Apple working on the Fire Phone.

• 1:49:08Jordi Hays?

  And everyone, I've, I've seen a million decks where we're like, we got this guy who worked on iOS at Apple. And it's like, some of them.

• 1:49:15Mark Gurman?

  Yeah, I know, everyone says they worked on iOS at Apple, it's good for the resume.

• 1:49:18John Coogan?

  Yeah.

• 1:49:18Mark Gurman?

  Uh, whether it's true or not, you know, every company likes to say, oh, we got this big wig from Apple. And then, you know, you ask people at Apple about this person, they're like, I've never heard of this guy, he didn't even work here. Um, but that, that's besides the point. The, the real story here is that Apple had known for a while now that there was probably some shady stuff going on when you have that many people. I mean, the person running the hardware organization at OpenAI, a guy named Tang Tan, he was heavily respected when he was at Apple. But, you know, once he left Apple, uh, it was, it was wartime. This was a person who had been running the iPhone design team for many years, uh, paired with Johnny Ive, who was the designer, you know, alongside Steve Jobs for, for decades.

• 1:49:59Mark Gurman?

  Uh, Ive's successor, Evan Tankey, uh, who ran the ID studio, the industrial design studio for three years after Ive left. Uh, they set out to build the product to take down the iPhone. Um, you know, you can ask yourself, is that even possible? But on the other hand, the fact that these people, you know, worked for Apple for so long and they wanted to create sort of the antidote to Apple. It's a scary thing for, for Apple. And that coincided with Apple facing its own AI struggles. Uh, right now, their hardware engineering organization is going through the biggest transformation in decades. Uh, with John Turner stepping up to become CEO and Johnny Sruji, the chips guy, now becoming in charge of hardware engineering, uh, himself.

• 1:50:41Mark Gurman?

  Uh, you know, he's a visionary when it comes to management and silicon. But the big question is he a visionary when it comes to, uh, products? Obviously, John Turner will, will help with that as well. So there's some big questions at Apple right now. Obviously, it's been a very long time since they had a big new hit. The Vision Pro was a complete flop. And so this company combining the best AI, right? OpenAI, using some of Apple's best engineering talent, plus three hundred and ninety of their best friends from Apple. It's a scary sight for Apple.

• 1:51:10John Coogan?

  Yeah.

• 1:51:11Mark Gurman?

  You know, they maintained that this lawsuit was not about slowing down OpenAI. It's because they were able to find, they're not calling this, but I can't think of a better term. They knew some shady stuff was going on and they found a smoking gun, right? Smoking Gun was this young iPhone, uh, engineer who went from Apple to OpenAI at the beginning of this year. And it's a crazy story. He kept a MacBook, he had this relationship. They're not saying if it was like a romantic relationship or whatnot, but I have to imagine that probably had a component there. Uh, he was working with this, uh, girl who was still at Apple, who eventually went over to OpenAI. And he had found some flaw in their cloud network and was working with her to get stuff, even though he was still working at, at OpenAI.

• 1:51:54Mark Gurman?

  So, you know, you can make a Netflix special out of this, or you can make an Apple TV special out of this, but they'll never go for that.

• 1:52:01John Coogan?

  Um, maybe it'll be on Amazon Prime.

• 1:52:02Mark Gurman?

  A lot of interesting stuff, yeah. And then they kept digging, they found a bunch of stuff on Tang Tan.

• 1:52:06John Coogan?

  Yeah.

• 1:52:06Mark Gurman?

  And they built this lawsuit around this guy who worked at Apple for 25 years. Uh, everything that I'm told about Tang Tan is obviously a brilliant guy. He flew very close to the sun, is what a few people told me. Uh, I'm not going to say he did shady things, but he did what he needed to do to help make the iPhone the most successful consumer gadget. It's a well-designed piece of machinery, you know, most successful consumer product ever, what one could argue.

• 1:52:33John Coogan?

  Yeah.

• 1:52:34Mark Gurman?

  Uh, so they knew some of his tactics. Uh, he helped build that iPhone.

• 1:52:38Jordi Hays?

  So you're saying there was an awareness at Apple that he was basically like always playing to win very aggressively?

• 1:52:47Mark Gurman?

  Yes.

• 1:52:48Jordi Hays?

  Like potentially blurring some, some lines.

• 1:52:50Mark Gurman?

  Yes, yes. So they knew their players.

• 1:52:53John Coogan?

  Got it.

• 1:52:53Mark Gurman?

  And so they knew this guy was going to do anything to get things done. But they weren't able to sue them until they found this kid. Um, one thing I'll say, and it's kind of unfortunate, there's two people at OpenAI on LinkedIn with the same name. There's the guy who's named the lawsuit, and there's another dude at OpenAI with the same name. Um, and maybe he works for TV, I'm just joking. Um, and I see a bunch of people posting on, uh, LinkedIn or on Twitter, whatnot, screenshot. I'm like, you've got the wrong dude. And so, uh, you know, whenever there's a.

• 1:53:24Jordi Hays?

  That's interesting, yeah.

• 1:53:25Mark Gurman?

  Yeah. Whenever there's like the big tragedy, whatever, everyone goes out to try to find the guy's name and everyone posts the wrong Facebook account. So this guy is getting blamed for, uh, he's getting blamed for it, but it has nothing to do with him.

• 1:53:36John Coogan?

  Yes, there, there's also an, an actor, uh, with the name Chang Liu. And, uh, he has some very iconic photos on the internet because he's like a, basically a male model.

• 1:53:48Mark Gurman?

  Uh, and it's funny.

• 1:53:50John Coogan?

  Confused.

• 1:53:50Mark Gurman?

  I think I saw that.

• 1:53:51John Coogan?

  Yeah, yeah, yeah, Chang Liu. Uh, he looks, uh, he looks like, yeah, just like a, a model straight out of the runway. Um, what does the timeline for this case look like? Uh, I was digging into XAI's, uh, lawsuit against OpenAI, uh, filed about a year ago, just was dismissed, I guess, a month ago.

• 1:54:10Jordi Hays?

  Uh, is that about App Store ranking?

• 1:54:12John Coogan?

  No, no, no. So, so, uh, XA, SpaceX currently has an ongoing lawsuit with Apple about the, uh, App Store ranking. That has not been decided. But, uh, separately, XAI sued OpenAI for, uh, poaching employees and potentially getting those employees to share secrets of how Grok is trained. That's the allegation. And that case was just dismissed, um, last month on the fifteenth. But it took a year to get there. And I'm wondering, because we have that as an example, we also have the Samsung, Apple battle that took eight years and ultimately ended in a settlement. And I'm just wondering about how you're feeling about the pace of things. There was sort of a quick back and forth on X, uh, some comments from OpenAI leaders.

• 1:54:55John Coogan?

  Uh, but how will this story actually evolve and play out?

• 1:54:59Mark Gurman?

  It all depends. I mean, OpenAI is going to fight Apple like hell.

• 1:55:02John Coogan?

  Yeah.

• 1:55:03Mark Gurman?

  They'll have a law firm involved. Uh, in fact, you know, OpenAI hired a law.

• 1:55:06Jordi Hays?

  They won't use chat? Codex?

• 1:55:09John Coogan?

  Bearish.

• 1:55:09Jordi Hays?

  Yeah, modern new models.

• 1:55:10Mark Gurman?

  Yeah. They hired, they, they, they actually hired a law firm a couple of months ago.

• 1:55:15John Coogan?

  Okay.

• 1:55:15Mark Gurman?

  And they were going to sue Apple over the relationship when it came to the Apple Intelligence Siri deal.

• 1:55:21John Coogan?

  Yeah.

• 1:55:22Mark Gurman?

  So they've got lawyers looking into this and working on this. I wonder, so Apple's saying that they reached out to OpenAI in February, uh, about their concerns over trade secrets and whatnot. I wonder if OpenAI started preparing its lawsuit against Apple as part of a, you know, down the line counter suit type of situation.

• 1:55:41John Coogan?

  Yeah.

• 1:55:42Mark Gurman?

  Uh, or is in response to Apple's letter of, neither here nor there. I think this could take, uh, several months to, to years. It really depends. The discovery process is going to take a while. But if I'm going to be really honest with you, I don't think the courtroom timeline really matters. I mean, matters to some extent, but the bigger picture already happened. If you're an Apple employee and you're thinking about joining, uh, OpenAI right now.

• 1:56:07John Coogan?

  Sure.

• 1:56:07Mark Gurman?

  First of all, you're going to keep your mouth shut, you're not going to tell anyone.

• 1:56:10John Coogan?

  Yeah.

• 1:56:10Mark Gurman?

  Right? Uh, they're going to walk you out.

• 1:56:12John Coogan?

  Yeah.

• 1:56:13Mark Gurman?

  It is not a good thing to be someone at Apple right now, uh, who's thinking about joining OpenAI.

• 1:56:18John Coogan?

  Sure, sure, sure.

• 1:56:18Mark Gurman?

  You're going to have Apple security all over you, your manager's going to despise you.

• 1:56:23John Coogan?

  And everything you did, they're going to be watching every website you went to on your.

• 1:56:27Mark Gurman?

  Yeah.

• 1:56:28John Coogan?

  Computer for the last month.

• 1:56:29Mark Gurman?

  So.

• 1:56:29John Coogan?

  So you got to know that you're going to be really clean if you're thinking about that, yeah.

• 1:56:32Mark Gurman?

  Yeah. So if you're thinking about going to OpenAI and you're at Apple, uh, the way Apple wrote this lawsuit, you have to be out of your mind to not think twice about it. And I think that Apple needed to stop the bleeding to OpenAI. Uh, and this lawsuit.

• 1:56:46John Coogan?

  Yeah.

• 1:56:46Mark Gurman?

  Is certainly going to, to help with that.

• 1:56:49John Coogan?

  Yeah.

• 1:56:49Mark Gurman?

  The other thing is, is you're going to have Tang Tan, all those guys caught up in depositions and discovery and meetings with lawyers now. It's like, how are you supposed to launch a product? How are you supposed to do your job if you're stuck in the office all day with lawyers?

• 1:57:02John Coogan?

  Sure, sure.

• 1:57:02Mark Gurman?

  Um, everything's going to need to be cleaned up. They're going to need to work in a clean room-like environment now. They're going to investigate what kind of Apple IP is in there. And even if, if OpenAI did nothing wrong, all of the work that's, it's going to need to be done to prove that. This is just going to be a big waste of time for everyone. So, uh, by just filing the lawsuit, Apple accomplished quite a bit.

• 1:57:22John Coogan?

  Yeah.

• 1:57:23Jordi Hays?

  So how do you think a, uh, a company like Apple, who notoriously is, you know, very protective about internal secrets, process, supplier, you know, all these different things, uh, is in the middle of, of getting, you know?

• 1:57:43Jordi Hays?

  You know, the craziest talent raid in consumer electronics history and then just like has someone go out the door and and they're not even, you know, we were reading Ben Thompson's piece earlier, just and he was kind of mocking Apple's security and and as I was reading the complaint, I was thinking back to the deal, sort of rippling drama that happened last year and how the guy was kind of set up and in some way. And and I was thinking like, is Apple, is Apple savvy enough to to like, try to create a smoking gun by being like, yeah, let's not, let's just let it, yeah.

• 1:58:22John Coogan?

  This is full tinfoil hat.

• 1:58:23Mark Gurman?

  Yeah. You think Apple just made this whole thing up?

• 1:58:25Jordi Hays?

  No, no, no, no, no, I'm not saying that. I'm not saying, I'm not saying that at all. I'm just saying like, it would be crazy to me if you get, you're getting people poached and you're not like, oh, yeah, we should make sure all the.

• 1:58:36John Coogan?

  Oh, you're leaving the company? Sure.

• 1:58:38Jordi Hays?

  Yeah, just keep your laptop kind of thing.

• 1:58:40Mark Gurman?

  Oh, yeah, yeah.

• 1:58:42John Coogan?

  That'd be wild, wild twist. Well, I mean, I I'm sure more information will come out.

• 1:58:47Mark Gurman?

  The discovery process is going to be very exciting, very interesting.

• 1:58:51John Coogan?

  Totally.

• 1:58:52Mark Gurman?

  I think Apple has a very high burden of proof here from a legal standpoint. I'm not a lawyer, but being able to prove that its IP is within certain products is going to be, it's going, it's going to be difficult to prove.

• 1:59:03John Coogan?

  Yeah.

• 1:59:03Mark Gurman?

  So we'll see if they're able to do it.

• 1:59:05John Coogan?

  Also, the narrowing of like, what is a trade secret? Because like, it's been this like awkward reality in the AI race that when a AI researcher leaves for another lab, they basically take the architecture that isn't necessarily patented and is sort of a trade secret, like, they take that with them and they just say, oh, yeah, like, we should probably train a model of this size, or we should probably include some of this training data. And that's why we've seen the frontier. But that's very different from hardware stuff with patents and.

• 1:59:35Mark Gurman?

  Right. I would like to know what trade secrets or what Apple will be able to claim as a trade secret.

• 1:59:40John Coogan?

  Yep.

• 1:59:40Mark Gurman?

  Ends up in these products. Because, as you know, and everyone listening to this knows, hardware is incredibly commoditized. There are hundreds of companies that make electronics in the same space that Apple all over the world.

• 1:59:53John Coogan?

  Yep.

• 1:59:53Mark Gurman?

  And being able to prove that you're using Apple technology to release your phone and build your phone, develop your phone, that's going to be very difficult. I, I, I don't see this being a clean victory for Apple if it goes to a jury trial. They don't, in my guess is they're not going to have, remember the Samsung trial? This is what Samsung phones look like before the iPhone. This is what the iPhone looked like.

• 2:00:16John Coogan?

  Yep.

• 2:00:16Mark Gurman?

  This is what Samsung phones look like, right? They broke it down so a third grader would understand it. It was very easy to follow.

• 2:00:22John Coogan?

  Sure.

• 2:00:22Mark Gurman?

  Short of that, I, I just don't see how Apple can win a jury case here. And if you read the complaint, over and over again, Apple acknowledges that they don't really know what is really happening here. They know enough to know there's something shady going on and we need to discovery, discovery to figure out what is going on. And so they'll, they'll do that. But I'd be very surprised if they find something. And the other part of this is, there's a few things that you can really make a trade secret case on right now. That's silicon. And Apple has very proprietary silicon code.

• 2:00:58John Coogan?

  Yep.

• 2:00:58Mark Gurman?

  The way they develop chips and design chips. And they went after this company called Revoz, that Meta ended up buying. And they got major changes made to how Revoz operates. The other one you mentioned is AI. You know, there's no AI thing that OpenAI is stealing from Apple. And from the chip side, everything we know is that OpenAI is using Qualcomm and third-party chip providers. So.

• 2:01:23John Coogan?

  Yeah.

• 2:01:23Mark Gurman?

  I'm very curious to see what Apple ends up finding. I'm sure they'll find some good text messages and emails, though.

• 2:01:29John Coogan?

  Yeah. Can you take us back in time to Johnny Ive's departure, the birth of I/O, how that was perceived within Apple? Because it feels like when the acquisition happened, it was 55 employees at I/O at the time, a lot of them ex-Apple. And Ben Thompson pointed out that, he said, I think Apple feels betrayed not just by Tan, but also Johnny Ive. Start with the fact that Ive framed his partnership with OpenAI as an attempt to undo the harms he thought were caused by the smartphone. Not exactly a ringing endorsement. So you see these, you know, people leave and they're like, oh, like, we, you know, we need, we need the antidote to the social media thing. This is a common, a common thread that, that

• 2:02:10John Coogan?

  people pull on in their second act of their career. But what was the I/O journey? Was it pretty smooth when that happened? Was this something, like, if, if you play out a different scenario and I/O is just consulting for, you know, a Samsung and.

• 2:02:23Jordi Hays?

  Ferrari.

• 2:02:24John Coogan?

  Ferrari and a bunch of other, you know, companies that are not like directly at each other's throats, new hyperscalers, a disruptive AI, take off all of that. How, how does the story look then?

• 2:02:36Mark Gurman?

  So the story, well, I'm not going to get into the Johnny Ive stuff right now, but, you know, Tang Tan, he tells John Turnus. By the way, the other side of this thing is him and Turnus hate each other. I'm happy to go into that. But Turnus, you know, he was up for the SCP of Hardware job in 2020. Tang Tan and a lot of the people at Apple who now are at I/O and at OpenAI, they wanted Tang to be the new head of hardware engineering because they enjoyed working with him on the product design side of things and the ID studio and product design works very closely together. Tang had run the iPhone side of things. Turnus for a number of years was running the iPad and the Mac side of

• 2:03:18Mark Gurman?

  things. He had felt that a lot of the core technologies that Tang was working on, you know, they got iPhone priority and he didn't really want to share that with the iPad and the Mac team. You know, now Turnus and Cook are sort of getting the last laugh, sort of, you know, giving Tang that reputation that he's not going to ever be able to drop of being someone who sort of, they didn't say the words, but a ringleader around this. So that's what happened. He tells Apple at the end of 23, he's leaving. Turnus lets him stick around through February of 24, because Tang's role at Apple was so big, he had his tentacles in so many different things. They actually had to replace him by splitting up his responsibilities, if I remember correctly, across five or six or seven different people.

• 2:04:03John Coogan?

  Wow.

• 2:04:03Mark Gurman?

  So it took a lot of time to unwind. He, behind the scenes, was already working with Johnny Ive and Sam Altman and some of these other folks on creating this company. I think the origin story of I/O is they knew all along that they were going to get acquired by OpenAI. The other part, and this sort of got buried when OpenAI acquired I/O, but like, OpenAI already owned 25% of I/O, if I remember correctly, for a year or maybe more before the acquisition of OpenAI buying I/O was announced. So that's pretty interesting.

• 2:04:37John Coogan?

  That's very.

• 2:04:38Mark Gurman?

  Neither here nor there, I/O, they're some of the best talent who's ever worked at Apple. Combining the best talent that's ever worked at Apple with the, with the AI acumen of OpenAI is a scary sight, I would say.

• 2:04:54John Coogan?

  Mm hmm. Oh, no, they're gonna have to pivot to a VR headset.

• 2:05:00John Coogan?

  My dream. I just want another VR headset. That's all I want. But I don't think I'm getting it. Yeah, me and me only. I'm the only one that's gonna get it. It's, it's rough. What else is, what else is new in, in Apple world? What else are you covering?

• 2:05:15John Coogan?

  Outside of this?

• 2:05:16Mark Gurman?

  Lots of stuff, lots of stuff to come.

• 2:05:18John Coogan?

  Yeah.

• 2:05:19Mark Gurman?

  Apple's gonna start its biggest new product period in its history.

• 2:05:23John Coogan?

  Yeah.

• 2:05:23Mark Gurman?

  This fall.

• 2:05:25John Coogan?

  And, and at higher prices, right? Like, the, the, the memory shortage is very real. It was sort of like a delayed announcement post WWDC, but, you know, the, the, the strategy there was like rip the Band-Aid off after WWDC, but with enough time for everyone to absorb the news before the products are launched. Is that generally the, the theory there?

• 2:05:48Mark Gurman?

  Well, you know, they hit the point where they couldn't impact their margins anymore. Obviously, they're reporting earnings at the end of this month, so they'll talk more about that.

• 2:05:57John Coogan?

  Yeah.

• 2:05:57Mark Gurman?

  But the big picture here is the iPhone is going to get its price hike in September.

• 2:06:02John Coogan?

  Yeah.

• 2:06:02Mark Gurman?

  Everything I'm told is that the cost to build because of the memory makes these phones $150 to $200 more expensive a unit.

• 2:06:10John Coogan?

  Yeah.

• 2:06:10Mark Gurman?

  So I think they're going to raise the prices by $150 to $200.

• 2:06:14John Coogan?

  Yeah.

• 2:06:15Mark Gurman?

  They don't want to give up that margin. I mean, the fact that nobody's buying Division Pro and Apple hiked the price up by 200 bucks anyways because of the memory, tells you everything you need to know. This is not a company that's going to compromise on its margins.

• 2:06:25John Coogan?

  Sure. Is there any world where vertical integration around memory is on the table? Like, going deeper there? Even like the Southwest bought all those like futures on oil and had cheap gas and cheap flights for a long time. Like, you know, even if you're not AGI build and you don't build the foundation model, there's still a world where you go lock up really long memory contracts and keep your prices down?

• 2:06:48Mark Gurman?

  I don't see it happening.

• 2:06:49John Coogan?

  Hmm. Just not culturally the value.

• 2:06:52Mark Gurman?

  I don't, yeah, I don't see it happening. I think they're trying to get the suppliers to expand.

• 2:06:57John Coogan?

  Sure.

• 2:06:58Jordi Hays?

  How is Apple's relationship with TSMC evolved or changed across the AI boom?

• 2:07:07Mark Gurman?

  Ooh, well, I think the long and the short of it is that, you know, Apple's still the preferred customer of TSMC, but there are plenty of other customers now that are a big piece of the pie. And so I think the relationship still remains very strong. But I don't think this is exclusively because of the AI boom. And you can see now Apple looking at secondary, potential third suppliers on silicon. You've seen that with Intel. They've talked to Samsung as well. But the TSMC relationship, from everything I understand, is still as strong as ever. It's just Apple's not the only game in town as a customer at this point.

• 2:07:40John Coogan?

  Mm hmm. Well, thank you so much for taking the time to come break it down for us. We appreciate you.

• 2:07:46Mark Gurman?

  You got it.

• 2:07:46John Coogan?

  Hop it on.

• 2:07:47Jordi Hays?

  Yeah, congrats again on a, on a major scoop, on a major scoop. How much, how much time did, did you, were you able to, were you able to like pre-write your article before the actual complaint was live? Or did you, did it go live and then you wrote it?

• 2:08:07Mark Gurman?

  Did I write my article before the complaint was live?

• 2:08:10Jordi Hays?

  Like, did you know it was about?

• 2:08:12Mark Gurman?

  Good question. I'll tell you next time.

• 2:08:17John Coogan?

  Thank you so much.

• 2:08:18Jordi Hays?

  Great to see you, Mark.

• 2:08:19Mark Gurman?

  See you, guys.

• 2:08:20John Coogan?

  Goodbye. Let me tell you about Public. Whether you're long Apple, short Apple, Public has investing for those who take it seriously. Stocks, options, bonds, crypto, treasuries, and more with great customer service. Let me also tell you about 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. Yes.

• 2:08:43Jordi Hays?

  Yeah, I can see why he wouldn't actually want to answer that question after I said it.

• 2:08:47John Coogan?

  He knows everything. Nothing happens in Cupertino without Mark Gurman knowing first.

• 2:08:54John Coogan?

  There's an interesting AI threshold that was broken over the weekend. I didn't know that I wanted my goalpost in this particular area, but I like this. So Ethan Mollick shared this. He says, "This was one of those impressive AI thresholds for me. I gave GPT-5.6 Soul in Codex control over my computer and asked it to win the daily challenge for the game Slay the Spire 2, randomized factors, so it can't cheat. You can't just look up the answer." And he said, "It worked for five hours making complex game choices and won." And I've been a huge fan of Slay the Spire. I really enjoy this game. I didn't know that there was a sequel. I guess there's a sequel out already.

• 2:09:36John Coogan?

  But it's a slow-paced game. It's turn-based. So you can take as long as you want to make every decision. And so it's not real-time, so it's somewhat suitable for this. But it makes me very, very clear that these are great benchmarks for computer use. Because you can RL on certain Pokémon benches, the data will flow in once it becomes a big trend. But if you can just fire up some random game that you find personally interesting and watch a coding agent sort of win that game just through computer use, that's going to be a very visceral, feel the AGI moment for a lot of people. What do you think?

• 2:10:21Speaker 05

  I mean, yeah, I think the current coding models are not good at this because they're like a little bit too slow.

• 2:10:26John Coogan?

  Yeah.

• 2:10:27Speaker 05

  But if you remember, Standard Intelligence had that computer agent model where it was like playing games in the browser.

• 2:10:32John Coogan?

  Yeah.

• 2:10:33Speaker 05

  So that's like a very different architecture from like what Codex is using right now or whatever Claude Code.

• 2:10:38John Coogan?

  Yeah.

• 2:10:39Speaker 05

  I think it should be very possible.

• 2:10:41John Coogan?

  So, yeah, I mean, there's been a lot of advancements in AI that can win games, but it needs a very specific harness. Like, it always needs to have some sort of like the output is basically JSON or something, and that's translated into actions in the game. What's so cool about this demo is that there is no harness. It's just moving the mouse and clicking the buttons. And it learns all of that on the fly, which I think is really cool. Which means that we need to move the goalpost one more time because we are coining and we are creating Rust Bench, which is not the programming language Rust. It is the level in Call of Duty: Modern Warfare 2, right?

• 2:11:23John Coogan?

  You need to be able to beat Geordi on Rust if you're building a coding agent.

• 2:11:28Jordi Hays?

  Isn't it COD 4?

• 2:11:29John Coogan?

  Oh, is it?

• 2:11:30Jordi Hays?

  MW 2.

• 2:11:32John Coogan?

  Wait, which one is it?

• 2:11:33Jordi Hays?

  We play Modern Warfare.

• 2:11:35John Coogan?

  We play COD and we play Rust.

• 2:11:38Jordi Hays?

  Rust. And the fact that you guys can't even get it straight.

• 2:11:41John Coogan?

  We are going to set up Codex on Rust, and we are going to 1V1 it and hopefully defeat it for a very long time because humans must stay in control. But I have a feeling that the AI will win eventually. But it might take the cerebrus chips. It's going to have to think pretty quickly, think on its feet. Because five hours to win Slay the Spire, I think it takes a normal person like maybe 30 minutes, 45 minutes to win one of those challenges. We're getting called not real gamers. It's really rough right now. We're getting absolutely destroyed.

• 2:12:14Jordi Hays?

  Damn, Young John would be just so disappointed.

• 2:12:17John Coogan?

  It's been a while. Let me tell you about Codex. Codex is a powerful workspace for getting work done with AI agents and playing video games now. Whether you're writing code, analyzing data, creating content, or automating business workflows, Codex helps you move projects forward from start to finish. And we have our next guest with us in the TV.

• 2:12:32Jordi Hays?

  This is big.

• 2:12:34John Coogan?

  This is big and relates to what we were talking about earlier.

• 2:12:37Jordi Hays?

  What's going on, guys?

• 2:12:38John Coogan?

  How you guys doing?

• 2:12:39Nico Christie?

  Yo, thank you guys for having us. And congrats on the acquisition.

• 2:12:43John Coogan?

  Thank you.

• 2:12:44Nico Christie?

  I've already seen Codex ads, cerebrus ads.

• 2:12:46John Coogan?

  Yeah.

• 2:12:47Nico Christie?

  I'm hyped for you.

• 2:12:47John Coogan?

  Yeah, yeah.

• 2:12:48Jordi Hays?

  Thank you. Great to see you. And Michael, we are honored to have you on the show. So Nico, why don't?

• 2:12:57Jordi Hays?

  We've been dreaming, actually dreaming about this moment. We've talked, John and I have talked on and off air about wanting to get the greatest Excel jockeys on the show.

• 2:13:10John Coogan?

  Yeah.

• 2:13:10Jordi Hays?

  We finally did it, courtesy of Nico.

• 2:13:12John Coogan?

  So maybe quick introductions.

• 2:13:13Jordi Hays?

  Nico, yeah, set the scene for us. Why are we talking, why are the three of us talking with the Excel world champion?

• 2:13:21Nico Christie?

  For sure, for sure. Yeah, guys, I'm Nico. We chatted about a year ago when we launched the first Superhuman Excel agent. We launched Shortcut, it caused like a big storm. And we've been like heads down in spreadsheet hell for like a year trying to build an agent that was really, really freaking good. A whole combination of things happened that I felt like we did pass this threshold where maybe it's at the level of a Michael Jarman or Dimmer Lee. And I'll let Michael introduce himself. But I flew down to San Diego last week, nervous as hell, calendered a studio. We rented it out and competed live on four official championship models, me versus Michael. And of course, I had Shortcut, but Michael had his big brain.

• 2:13:57Jordi Hays?

  There you go.

• 2:13:59Jordi Hays?

  Michael, when did you first? Name, do you remember your first Excel session?

• 2:14:07Speaker 07

  That's a great question. I think it would have been when I was about seven or eight. I think for some reason I decided I wanted to put the 2002 World Cup in Excel. I mean, somebody else had already done this because somebody else was running the tournament. But I decided that seven-year-old me could do it instead. That's my earliest memory with Excel. But yeah, since then, sort of built a career doing various things in Excel. And it's now a competitive esport for reasons that I still don't really understand. But it's fantastic. There's a great community around it. It's surprisingly watchable. And yeah, I won that competition in 2024. There's a financial modeling sort of World Cup that is sort of a little quieter. I won that last year, which is why Nico decided that I should represent humanity

• 2:14:52Speaker 07

  and see if we can all keep our jobs.

• 2:14:55John Coogan?

  What is the shape of the challenges in an esports competition around Excel? How much randomness is in there? I mean, I've seen the screen recordings where you have to change the color of a bunch of cells, reshuffle, sort things, write formulas. But how much do you know going in? How defined is like the scope of problem that they're going to give you?

• 2:15:20Speaker 07

  Yeah, I know the videos you're talking about. It's some dude who like speedruns, like doing all that. That's not what we do. I do not have the dexterity for that at all.

• 2:15:29John Coogan?

  Interesting.

• 2:15:30Speaker 07

  So what we do is it's more sort of problem-solving in Excel, a bit like a hackathon essentially. So you'd be modeling some sort of board game or navigating around a map. The year I won, you sort of had 20 characters in World of Warcraft because they were sponsoring it that year. And you sort of had to track them leveling up and doing quests and whatnot. It can be very, very random, like what comes up, like whether or not it's your sort of question or someone else's. Like, there's a vast array of things that people can do using spreadsheets. So yeah, the question makers do make a good effort of trying to make a variety of topics people ask questions.

• 2:16:06John Coogan?

  And then on the actual grading, how much is qualitative versus like once the solution has been found, the buzzer buzzes and it's deterministic every single time? Like, pure math versus there's, oh, you know, you got a nine out of 10 from this judge because there's some style points in there?

• 2:16:25Speaker 07

  No, there's no marks for the style at all, which I think is for the best. I think if people had to spend time making things look pretty, I don't think it would be nearly as entertaining. It's entirely deterministic, like somebody else has already calculated what the answers are. And then as you're copying them in, they either go, yeah, you've got them right, or no, you haven't.

• 2:16:44John Coogan?

  Okay. Is there anyone who tries to basically eschew Excel entirely and solve the problem with Visual Basic? Because if I understand correctly, Excel has like a VBA backend and you can basically write, you know, programming languages, you can just write code.

• 2:17:03Speaker 07

  Yeah, absolutely. So there's nobody who tries to solve it entirely in Visual Basic just because anybody who's watched this, who's coded in VBA knows it's a terrible language. It's so slow to get going. There's bits, there's chunks of code people have, especially for things like looking at the colors of cells. Like, if you've got a map and like the blue cells are water, the green cells are land. There's no native way in Excel to do that with formulas, so you need VBA for that. There is one guy who, there's now Python and Excel. That's been there for about two years, I think. And like you write some Python code, it gets sent to Microsoft, they run it, they send you back the answer. And there's one guy who competes in that and does quite well. His general thing is he's very slow to get going. But when he gets going, he sort of really starts to pick up pace.

• 2:17:48Speaker 07

  So again, it's a little bit of the randomness of what sort of case comes up. Some suits him, some suits him less.

• 2:17:54John Coogan?

  And then what are the rules around artificial intelligence, co-pilots? There's, you know, AI is coming to Excel. Do you think competitors will freeze on a particular version of Excel that doesn't have AI? Or will there be an AI subcategory that allows you to use some co-pilots, everything, unlimited, unrestricted, you know, and no rules apply categories? How will all that play out?

• 2:18:22Speaker 07

  Yeah, so AI is banned in the main competition. It's getting increasingly difficult to police because it's making stuff that looks more and more like a human would compared to sometime, maybe eighteen months ago. Maybe they'll start running like an AI assisted competition. I know a few people have talked about that. I don't think it'll be very popular. Like, you look at the World Chess Championship, people watch that. There is a World Chess Engine Championship, people don't watch that as much. So, but yeah, it's currently banned. I think we're still gonna wanna keep on the latest version of Excel because they're adding other stuff to it that's quite helpful, like they added Reg X about a year ago. So, if we didn't have that, some people would complain. But yeah, at the moment, it's kind of an honor code. Like, when you get to Vegas,

• 2:19:05Speaker 07

  where it is to do the finals live, and you obviously can't just be like, "I ChatGPT do this for me because someone will notice." At home, it's currently not a code, which is, yes, something we're finding harder and harder to police.

• 2:19:16John Coogan?

  Yeah, that makes sense. So, Nico, like, what are you learning from Excel championships? Going up against the GOAT. Yeah, yeah, yeah, yeah. This is your competition. Is there training data to be learned? Are there sort of like the rough edges of the spiky intelligence? You notice things at the top tier level that then can be applied for everyday users that use your product? How are you actually working together?

• 2:19:42Nico Christie?

  Yeah, yeah, for sure. I wanted to know that, like, one, could you really compete at this high level? And what has to be true for you to get there? And how much of this is like mastering the art of using AI versus how much could you like institute into the product as like a first class just experience for everybody? And it turns out that like, you have to be really fucking good at using, sorry, really good at using AI to even have a chance. So, like, when I competed, I actually did some practice cases at home all weekend before leading up. And like, AI will take the same way encoding, like, the path of least resistance. It'll be like, okay, well, I didn't check every single question. I looked at the hints and then decided what I should answer. And I'm like, no. And you'll see this in my prompts. I'm like, do a blank space audit, spin off adversarial review subagents of multi-different model types at the frontier to see that, like, you know, they think differently. I don't want

• 2:20:26Nico Christie?

  you to catch yourself. And with enough verification loops, you can clearly get a hundred percent on like any realistically hard challenge that is verifiable. But that's not how most people use AI. And I wanted to know what it required to get there, and then work backwards from, like, how do you bake this into the product? Because there's a trade off to these things. And, you know, I actually didn't even use the best model. Like, I didn't use Fable. I had to use Opus 48 Fast because it's the right spot of the Pareto Frontier. Because I would probably have lost to Michael if I used Fable. Because we were getting a hundred percent accuracy on almost every question. But I was, you know, faster because of the model I had chosen.

• 2:21:01John Coogan?

  Is there strong transfer learnings from these verifiable tasks versus the less verifiable stuff that people do in Excel all day long? Like, the average investment banker who's doing a DCF, like, it's not like at the end of the day, they're like, yep, the share price should be $200. You know, you're building a case.

• 2:21:20Nico Christie?

  Right, right. So, in, I would say AI is better suited for the contest than it is for real Excel work. In that, like, this is like you asked first, which is, is this programmatically verifiable? Like, is there true or not true? And the answer is yes, here, because we have a contest. But if this was judged by a committee of like, experts based on taste, it would be way harder. Now, you can say that as AI becomes more tasteful, and it is, you see this on front ends, like, it's getting a taste for what looks right. We benefit from that. But there's another more difficult form of verification, which is like, okay, well, there's twenty ways to make a DCF. They all look great, but one is specific to your company. Like, how do you learn that? And that is like, the real long tail product learning curve that we bake in with our customers. Like, that's the real challenge right now. AI will do things right, but there's a million, there's a million right ways.

• 2:22:04John Coogan?

  Among your customers, what does demand for speed look like? I mean, we were talking about Cerebras, like, there's this trade off. And I feel like for, like, the nature of an investment banker, at least on the junior level, is often the MD is like, turn this around ASAP, because the client is meeting in an hour, and I need you to do as fast as possible. And there's no excuse for, well, I'm using a really solid model, but it's gonna take five hours to get back to me. What does demand look like? What are customers telling you?

• 2:22:34Nico Christie?

  Oh, man. I don't think enough people are talking about Cerebras, or whatever other alternative ways there are to get to like, whatever tokens per second that was.

• 2:22:41John Coogan?

  Yeah, just as soon as broadly, you know.

• 2:22:44Nico Christie?

  Yeah, it's gonna be, like, it's gonna open up computer use, it's gonna open up everything. Now, you have to hit, you have to hit a certain level of competency and accuracy first, before it even matters at all. But we are sort of there with Sol and Fable. Now, like, for example, we, even with Opus 48 Fast, we turn like an operating model build out with like fifteen quarters of, or fifteen years of historicals for quarters. Like, that can take thirty hours for a hedge fund to build, and then two hours to update every quarter. We do that like in one hour and then ten minutes. Now, we could get that to like, ten times faster. And that's actually what's gonna be a huge unlock. Because hedge funds, for example, want to track not two hundred companies a pod, but two thousand. But you cannot do that because they're Excel firepower bottlenecked. There's another bottleneck, which I think the future will care about. But it's like, even if it's faster, it has

• 2:23:29Nico Christie?

  to run headlessly. Because you're not gonna open up fifty models or a thousand models, like, on your computer. And Excel does not run headlessly. I bet you it will soon, though.

• 2:23:38John Coogan?

  At all? There's no, there's...

• 2:23:40Nico Christie?

  You can do some clever, clever arrangement of like VMs, like expensive licenses, and like, some companies might do this to get around the bottlenecks. But I'm, I would, I actually don't know for sure, but I would bet my life that Microsoft is working on this.

• 2:23:54John Coogan?

  Interesting.

• 2:23:54Jordi Hays?

  Nico, are you recruiting Michael yet?

• 2:23:59Nico Christie?

  Michael? No, I don't think I could afford a Michael. I would say, Michael, the best form of recruiting was after the contest, Michael asked me if we can get his team on shortcut. And we did.

• 2:24:08Jordi Hays?

  There you go. Wait, so, Michael, what are you, what's your, what's your, what do you do day to day when you're not competing?

• 2:24:16Speaker 07

  Yeah, so I've, about six months ago, I moved into private equity, investing in freight rail across North America.

• 2:24:22John Coogan?

  Thank you. Thank you for your service.

• 2:24:25Nico Christie?

  Private equity brothers.

• 2:24:28John Coogan?

  Faith and humanity restored.

• 2:24:30Jordi Hays?

  I needed that today. I needed that today. To know that our best and brightest are still choosing private equity, and not giving in to, you know, the Nikos of the world, building our AI future. There's nothing wrong with, yeah, make, you know, making the roll up, you know, the path.

• 2:24:50John Coogan?

  Well, congratulations to you both. Thank you.

• 2:24:52Jordi Hays?

  Yeah, really, really fascinating, guys. Great to see you, Nico, and great to meet you, Michael.

• 2:24:56John Coogan?

  Have a great rest of your day.

• 2:24:57Nico Christie?

  Thanks for having me.

• 2:24:58John Coogan?

  Goodbye.

• 2:25:02Jordi Hays?

  Private equity, got a good one.

• 2:25:06John Coogan?

  Dan Primack shared a little tinfoil hat theory. He is beginning to wonder if Sun Valley is really organized by Getty Images, and Alan and Co. is just a front. I wonder if they actually, do you think Getty Images actually sees an uptick in sales around Sun Valley? Is this just like tech insider baseball exclusively? You have to imagine, like, Met Gala sells more Getty Images than Sun Valley. It's more of just...

• 2:25:31Jordi Hays?

  Yeah, I think it's a good bit. The funny thing is, like, even being in tech media, we don't see that Getty Images has a bunch of photos of Sun Valley and think, okay, gotta go sign up for Getty. It's like, if a cool one pops up, it's like, great.

• 2:25:46John Coogan?

  And you kind of want the watermark on there, because it's like a status symbol that it was taken by a paparazzi and not by just some, some random person.

• 2:25:54Jordi Hays?

  Speaking of our previous conversation on betting, Risk Maxing says, "A nine to five isn't a career. It's a supply chain for casino ammo." And that is certainly one way to look at it. Although, that's not how we think about our work here, gentlemen.

• 2:26:09John Coogan?

  No, we respect the dollar, like Nick Cage. Ty Lopez calls Bunny "fuel units." I always thought that was a funny, funny turn of phrase. I call them fuel units. I call them fuel units. Well, this person calls them casino ammo, which is very silly. No two countries than AI data center have ever gone to war with each other. Is that true? That seems potentially true. What else is going on in the timeline?

• 2:26:34Jordi Hays?

  Major innovation in fashion. Let's pull this video up.

• 2:26:37John Coogan?

  I haven't seen this.

• 2:26:38Jordi Hays?

  Silva says, "This is the greatest invention created since AI. It is a polo and a quarter zip."

• 2:26:45John Coogan?

  Oh, it's all one?

• 2:26:46Jordi Hays?

  That's a one.

• 2:26:47John Coogan?

  Wow. There we go. What is this, what is this Kazakhstan ad? There's a targeted ad on Instagram, says, "If you love Tera Masu, you should visit Kazakhstan."

• 2:27:01Jordi Hays?

  Now, just try Kazakhstan.

• 2:27:03John Coogan?

  Try Kazakhstan. Is, is that an aerial photo of an area in Kazakhstan?

• 2:27:09Jordi Hays?

  Yeah, it looks like some sort of desert.

• 2:27:11John Coogan?

  It's a beautiful image, but I don't know what it has to do with Tera Masu. But I've actually seen ads from the Kazakhstan Board of Tourism before. They, they have a pretty significant firepower when it comes to advertising. I want to play this, this reel of this gentleman who's practicing his robot skills so he can take AI's job. Because it's my new favorite genre. I'm seeing less AI videos and more people doing AI impressions going viral. It's a very weird outcome. Everyone said that the, this is, this is the best.

• 2:27:49John Coogan?

  This is incredible acting. Look at this guy. So good.

• 2:27:55John Coogan?

  Uncanny, uncannily accurate, uncannily accurate. No, there's like a whole subgenre of people that just do impressions of the AI slop. There's that guy who does the chatting with the voice mode and it always gets wrong. And I see more of those than people actually generating AI voices. And I've also see there's this group of-

• 2:28:16Jordi Hays?

  You mean the off payroll QA tester?

• 2:28:18John Coogan?

  Yeah, exactly. Off balance sheet quality assurance. I see there's this, there's this group of, of, of guys who make Instagram videos that imitate AI videos and it's fascinating because you notice once they do the impression of the AI video, all the little quirks and tells of AI video, like they'll be saying lines and they, they pre-rehearse the lines and they have everyone in the shot move their mouth to the line, even if only one of them is saying it because that's something AI videos do a lot apparently. And then it has these odd like push in camera moves that happen all the time. It's very, very funny.

• 2:29:00Jordi Hays?

  We never talked about how I was referencing the turn it down meme with Alexis.

• 2:29:06John Coogan?

  Oh, yes.

• 2:29:06Jordi Hays?

  Wasn't picking it up. You guys-

• 2:29:08John Coogan?

  You were too subtle. Yeah, they caught it. I heard them laughing.

• 2:29:10Jordi Hays?

  I was like, do any of the athletes turn it down? He's like, no, actually. And I was like, how much can you make? 10, 15?

• 2:29:19John Coogan?

  Ridiculous.

• 2:29:20Jordi Hays?

  Pull up this last video. We'll close out the show with it from Emily.

• 2:29:25John Coogan?

  She's been on a tear.

• 2:29:26Jordi Hays?

  Is a-

• 2:29:27John Coogan?

  Every video is going viral.

• 2:29:28Jordi Hays?

  Voice actor.

• 2:29:31John Coogan?

  I think she's a real, she does voice acting for, for radio ads, but of course is making fun of the tech industry, I think.

• 2:29:37Speaker 08

  Your business runs on business, but your business's business is stuck in the past until now. Introducing Business AI for Business.

• 2:29:47John Coogan?

  Sounds like something we would promote.

• 2:29:48Speaker 08

  Business AI for Business leverages the power of-

• 2:29:50John Coogan?

  Let's get him a deal.

• 2:29:51Speaker 08

  Business AI for your business, transforming your business into AI business. With Business AI for Business, Business AI does your business in seconds, leaving your team to focus on the important business of your business, business. Now your business is free to run your business at scale, at speed, at AI. The future of business isn't coming, it's here. Business AI for Business. Business AI. Business, business. AI, AI, AI.

• 2:30:22Jordi Hays?

  Very talented. The funny is she's saying every voiceover script right now, which I would assume that this kind of like audio is like AI is really good at.

• 2:30:32John Coogan?

  Yeah.

• 2:30:32Jordi Hays?

  But, but I think some of the AI companies are LARPing and they don't know how good the, the voice models have gotten. So they haven't actually-

• 2:30:39John Coogan?

  So they hire a voice actor to read the most AI laden script of all time?

• 2:30:44Speaker 05

  Yeah. So, so I, like sometimes I listen to the radio on the way to work and I hear ads like this and I always buy these like big legacy companies.

• 2:30:50John Coogan?

  Okay.

• 2:30:50Speaker 05

  So I assume that's why they're not using like actual cutting edge technology.

• 2:30:53John Coogan?

  Bullish for voiceover artists, I guess. Reading AI for business ads.

• 2:30:58Jordi Hays?

  Last video of the day.

• 2:31:00John Coogan?

  Yeah.

• 2:31:00Jordi Hays?

  Did you see this? There's a clip from-

• 2:31:03John Coogan?

  This is so cool.

• 2:31:04Jordi Hays?

  SpaceX's new launch site.

• 2:31:05John Coogan?

  It looks like Dune. It actually looks like Dune. I'm pretty sure SpaceX accidentally built the transformer. At least that's what it sounds like here. And so you can play. This is designed to, to hold all the rockets so they can launch them, I think, every hour.

• 2:31:20Jordi Hays?

  Let's get some audio.

• 2:31:22John Coogan?

  Look at this. How did they, they shot this with a drone? This is Dune in real life. Look at this.

• 2:31:36John Coogan?

  The engineering that goes into this, just so, thinking so far ahead, like I think this is designed to launch a starship every hour.

• 2:31:45Jordi Hays?

  Yep.

• 2:31:45John Coogan?

  And it's like-

• 2:31:47Jordi Hays?

  It said that something like an Olympic swimming pool's worth of water that they use to-

• 2:31:52John Coogan?

  Cool everything. Yeah, the deluge. There's another video here. This new critical path video is just mind blowing. Love the deluge part of the story. You can play this video. This is crazy.

• 2:32:04Speaker 09

  ...in the neighborhood of about 650,000 gallons per minute.

• 2:32:10Speaker 09

  That's approximately in the range of about like one entire Olympic swimming pool being drained in the course of a minute.

• 2:32:19John Coogan?

  Is that for when it takes off?

• 2:32:20Speaker 09

  So for this flame deflector on pad two, we're sitting somewhere in the neighborhood of about 650,000 gallons per minute.

• 2:32:29Speaker 09

  That's approximately in the range of about like one entire Olympic swimming pool being drained in the course of a minute.

• 2:32:36John Coogan?

  This is how they quantify this?

• 2:32:37Jordi Hays?

  This is the kind of thing you can imagine, you know, maybe a world in the future where humanity has left Earth and, and another, another group comes and visits and they're looking at this thing, being like, what were they cooking?

• 2:32:53John Coogan?

  What were they cooking? Imagine if you had the world's biggest machine gun and it's just firing 11 pickup trucks per second out of the bottom of the rocket. Has to be the most American measurement of all, in all aerospace history. I love it. Always put it in, always put the power of your rocket in pickup trucks per second, I suppose. Anyway, thank you for tuning into TBPN. We will see you tomorrow at 11 a.m. Pacific, sharp. And leave us five stars on Apple Podcasts and Spotify. Sign up for our newsletter at tbn.com.

• 2:33:23Jordi Hays?

  We love you.

• 2:33:24John Coogan?

  We'll see you tomorrow. Goodbye.