AI Viruses, OpenAI's First Device, WSJ Mansion Section | Samir Kaul, Patrick Wendell, Grant LaFontaine

(01:31) - AI Viruses (08:18) - OpenAI's Device Takes Shape (16:39) - Meta Faces Major Child Safety Case (25:25) - 𝕏 Timeline Reactions (36:10) - WSJ Mansion Section (43:41) - Samir Kaul, a general partner at Khosla Ventures, discusses the firm’s investment in Jeff Dean’s Discovery Loop and its potential to apply AI to scientific research with tangible outcomes. He also shares his views on AI regulation, inflated private-market valuations, venture capital strategy, founder support, and the importance of taking bold risks to generate exceptional returns. (01:09:45) - Patrick Wendell discusses his role as Databricks co-founder and VP of Engineering, where he leads AI products and internal AI adoption. He explains how AI coding tools can nearly double engineering capacity while creating rapidly escalating consumption costs, and highlights model switching, intelligent routing, and optimization as key ways to control spending without sacrificing productivity. (01:27:30) - Grant Lafontaine discusses Whatnot’s $545 million Series G funding round at a $20 billion valuation and the live-shopping platform’s rapid growth. He explains how authentic, knowledgeable sellers can build substantial businesses with small audiences, while outlining Whatnot’s focus on customer experience, new markets, product categories, and future streaming formats. (01:44:17) - 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.

• 0:00Jordi Hays?

  You're watching TVP.

• 0:02John Coogan?

  Today's Friday, August 7th, 2026. We are live from the TVP Ultra Dome.

• 0:07Jordi Hays?

  Temple of Technology, the fortress of finance, the capital of capital.

• 0:11John Coogan?

  Let me tell you about ramp.com. Time is money. Save both. Use the use corporate cards.

• 0:16Speaker 02

  Bill Pay, accounting, and a whole lot more all in one place.

• 0:20John Coogan?

  Lots of voice changer today. Let's amp it up.

• 0:27John Coogan?

  Who had orange in the chat? Because the chat was trying to guess what color sunglasses you would be wearing today. Is that orange? Or is that more of like a burnt sienna?

• 0:37Jordi Hays?

  Well, I think it's more of a green, greenish frame with more of with an orange lens.

• 0:42John Coogan?

  You gotta drop the line. I'm wearing sunglasses because I'm looking at the future and it's very bright indeed. That's a good one. I don't know. No one gets that reference. Anyway.

• 0:57Jordi Hays?

  It's great to be back. It's Friday. We got a shorter show for everyone today. We have Samir, general partner of Coastal Ventures, coming on to talk about their new investment Discovery Loop, founded by none other than Jeff Dean and some of his crew from DeepMind. And then we have Patrick Wendell, co-founder of Databricks, joining to talk about their new blog post. I promise it's going to be more exciting than it sounds like. No, but they're doing smarter model routing and we're excited to catch up with him.

• 1:30John Coogan?

  Very excited. Well, for the first time, scientists have used AI to create entirely new viruses.

• 1:38Jordi Hays?

  You asked for it. They delivered. They delivered.

• 1:42John Coogan?

  They delivered.

• 1:44Jordi Hays?

  They woke up. You know what we don't have enough of?

• 1:46John Coogan?

  Viruses that have never existed in nature before. It's marked a milestone that could accelerate biotechnology while also raising long-term biosecurity questions, of course. Nightmare scenario is you go to Best Buy, you get a gaming PC with a couple pretty stock graphics cards and you're able to run an open source model that basically walks you through the steps of creating something really problematic. At the same time, there's a lot of really talented and and well-resourced organizations that are fighting that tooth and nail. And so we'll probably see a little, little, you know, back and forth equilibrium there. But lots of interesting questions. Important to note that these viruses do not

• 2:27John Coogan?

  affect humans whatsoever, even these new viruses. They they target bacteria. So it's more of an experiment, more of a demo, but you can see where things are going and.

• 2:39Jordi Hays?

  That doesn't make me that comforted, to be honest.

• 2:42John Coogan?

  You like your bacteria.

• 2:44Jordi Hays?

  You know, we naturally have where there's bacteria that is it's part of being human.

• 2:49John Coogan?

  And you would like the bacteria to be unaffected by viruses. Is anyone standing up for the bacteria right now?

• 2:55Jordi Hays?

  Well, it's more so like you have bacteria. You have bacteria in your gut.

• 2:59John Coogan?

  Yeah.

• 2:59Jordi Hays?

  And the gut is kind of an important part of.

• 3:02John Coogan?

  Now that bacteria is going to be suffering from a novel virus, apparently.

• 3:05Jordi Hays?

  Yeah.

• 3:05John Coogan?

  Well, in a study published Thursday in Science, researchers at Stanford and the ARC Institute trained an AI model to recognize patterns in naturally occurring viral DNA, then used it to generate genetic sequences for brand new viruses. After synthesizing those DNA sequences and inserting them into bacteria, the team found the bacteria produced viable viruses capable of infecting other bacteria. The work does not create a new threat to humans. Be careful. I'm sure that will get cut out of a lot of messaging around this because it sounds really scary on its face. The AI was trained only on bacteriophages, viruses that infect bacteria, and specifically excluded viruses that infect humans, plants,

• 3:48John Coogan?

  animals, and fungi. As a result, the model cannot generate viruses capable of infecting people. While scientists have been synthesizing viral genomes for years to study diseases and develop vaccines, this is the first time AI has been used to design entirely new viruses that function in the real world. And I was going back and forth before the show on, is this anything special? You know, we've been using tools to make viruses for bacteria for a long time. This is just another tool to do it. Or is this some, you know, material breakthrough? That's sort of a debate point. It sounds really scary, but also like you've been able to design these viruses in a lab for a long time. So what is the material difference here? I think it all comes back to acceleration and cost. If all

• 4:30John Coogan?

  of a sudden it becomes 1,000 times cheaper to generate viruses, then that can have a that could reshape biotech in a positive way, but also have biosecurity implications. So.

• 4:41Jordi Hays?

  Yeah, I think a lot of the reaction is just that it feels like a little too soon post Wuhan, a little too soon post hugging phase.

• 4:51John Coogan?

  Yeah.

• 4:52Jordi Hays?

  There's been a variety of events that I think naturally make people a little apprehensive when you see a headline like this.

• 4:59John Coogan?

  Yeah, a lot of people are like, you know, the LEA's or Yudkowsky reaction of ah, like this is bad. But we'll see where it goes. If the approach proves effective across other classes of viruses, it could become a powerful tool for medicine and biotechnology. Viruses are already widely used as delivery vehicles for gene therapies and other medical treatments, and AI-designed viruses could eventually expand that toolkit. At the same time, the research highlights how advanced how advances in AI are making it increasingly important to build safeguards alongside new capabilities, which I'm sure the ARC Institute is working on. And there's also other other AI-driven neo-scientific labs. I mean, Jeff Dean's, one of those was advancing. One of the goals of his new company with Discovery

• 5:44John Coogan?

  Loop is to work on biotech broadly. He has a very broad remit, but there are more narrow projects like that new company that's focused on finding a cure for the common cold. There are a few other projects that are more narrowly targeted, as well as all the biotech companies that are working on stuff. The if we're going to get advancing advances in viruses that deliver gene therapies or medical treatments, we got to rebrand virus. We got to come up with a new word, just like GLP-1 peptide, that felt very safe. It was like, you're not doing steroids. You're not on gear.

• 6:21Jordi Hays?

  What's the lizard?

• 6:21John Coogan?

  You're doing a.

• 6:22Jordi Hays?

  You're not doing Gila monster.

• 6:24John Coogan?

  Gila monster venom. Exactly.

• 6:26Jordi Hays?

  You're not doing Gila monster venom.

• 6:27John Coogan?

  No.

• 6:28Jordi Hays?

  Some Chinese peptide.

• 6:30John Coogan?

  The Chinese peptide was a rough go. But in general, I think the fact that it was like just a peptide, it felt much more welcoming as opposed to being in the world of the steroids, the performance enhancing drugs, and it became easier for people to jump in. Oh, I gotta learn about peptides. Oh, there. Oh, there's naturally occurring peptides? Cool. I'm into that. But virus has such a bad connotation post Wuhan as well as just everything. You're never like, oh, I got a I got a virus. And someone says, a good one or a bad one? Like, it's always bad.

• 7:01Jordi Hays?

  Yeah.

• 7:02John Coogan?

  It's never good. But so they need they need a new brand for that if they're going to commercialize that for sure. But we'll see. Anyway, there's a whole article in the New York Times about it. This AI just created viruses not found in nature. Has a cool little graphic by Carl Zimmer here. The new study published Thursday in Science goes well beyond duplicating viral genes. Scientists at Stanford University and ARC Institute taught AI to recognize patterns in of DNA in nature and then use that DNA to write recipes for entirely new viruses. The virus, the viruses dreamed up by AI do not pose a threat to humans because they are all similar to a naturally occurring virus called Phi X174, which can

• 7:47John Coogan?

  only infect bacteria. Really hardcore name for something that's not that dangerous. Phi X174 sounds like a offspring of Elon Musk. There's just a huge disconnect. The the research fellow said, governments and scientific organizations have been slow to develop guardrails that could block the creation of a deadly virus even as the science races ahead. So I don't think they'll be open sourcing this anytime soon. But there is other news. Mark Gurman's been reporting on OpenAI's first consumer device. It'll reportedly look like a hockey puck sized donut. Mark Gurman, the Germinator?

• 8:26Jordi Hays?

  Oh, the Germinator.

• 8:27John Coogan?

  The Germinator, yeah. OpenAI's, OpenAI's first commercial, consumer device, OpenAI's first consumer device will reportedly look like a hockey puck sized donut and cost roughly $300 to $400. What a funny form factor.

• 8:42Jordi Hays?

  Love hockey pucks.

• 8:43John Coogan?

  Yeah.

• 8:44Jordi Hays?

  Love donuts.

• 8:44John Coogan?

  Okay.

• 8:45Jordi Hays?

  So I like where this is going.

• 8:47John Coogan?

  There's also a rumor that it has mechanical pieces on it. So I think it can like undulate potentially. The speculation's all over the place. According to Bloomberg's Mark Gurman, the Germinator, as you put it, the battery-powered device is essentially a portable smart speaker without a screen, designed to be carried around the house or placed on a nightstand or kitchen counter. It will include speakers and microphones, along with cameras and other sensors that allow its AI to perceive what's happening around it. The device is intended to work much more, like a much more capable version of ChatGPT's current voice mode, learning about its owner over time and using that context to make conversations more personalized. OpenAI is also making the hardware itself feel more expressive. The device will reportedly include lights and parts that physically move as it responds.

• 9:31John Coogan?

  And the goal of with the goal of making it feel more alive than existing stationary smart speakers from Amazon and Google, the product being developed by Johnny Ob's design team is expected to arrive in 2027.

• 9:44Jordi Hays?

  Feature request.

• 9:44John Coogan?

  And envisioned as the first in a broader family of OpenAI hardware. Long term, the company reportedly hopes to develop AI devices capable of taking over some of the functions now handled by smartphones.

• 9:55Jordi Hays?

  Feature request.

• 9:56John Coogan?

  Yes.

• 9:58John Coogan?

  Flashbang. That'd be a feature request.

• 10:01Jordi Hays?

  Yeah, it says it has lights. It's got sound. You should be able to use this as a on-the-go flashbang.

• 10:08John Coogan?

  Yeah.

• 10:08Jordi Hays?

  So you're going to hang out with some friends.

• 10:10John Coogan?

  Yeah.

• 10:10Jordi Hays?

  You want to prank them a little bit.

• 10:12John Coogan?

  Yeah.

• 10:12Jordi Hays?

  When you're when you're kind of coming in.

• 10:15John Coogan?

  Yeah, I do. I was reflecting on the the DeepMind story of, you know, the departures there and the question of, you know, how the models are progressing versus the commercialization of those models. There's some real strong points. There's some weaker points within the within the rollout of Google's AI strategy. And I was I was thinking about like, what happened to Notebook LM? Because that was heralded as a very magical technology. You would, you know, give it some sources, a particular report, and it would just generate a podcast talking between two different people, much more conversational. And a lot of people like consuming information that way.

• 10:57John Coogan?

  So you could just go read a deep research report on the history of, you know, how bacteriophages work. If you want to get up to speed on that, because you're going to, you're trying to understand what's, what the ARC Institute is working on with these new viruses. You could go to Notebook LM and say, hey, why don't you generate me a podcast of, you know, two scientists explaining this at, you know, a high school level and then take it into college level.

• 11:24Jordi Hays?

  Tyler in the YouTube chat says Nut loves Notebook LM, use it weekly.

• 11:28John Coogan?

  Use it weekly.

• 11:29Jordi Hays?

  I always thought that I would have used it when I was in college.

• 11:32John Coogan?

  Yeah.

• 11:32Jordi Hays?

  And I needed to, let's say, write a paper on something and I wasn't super prepared. I could say, generate me an hour long podcast about this set of topics and I'd listen to that and then I could probably rip the paper.

• 11:47John Coogan?

  Yeah.

• 11:47Speaker 03

  I, I did that for a history exam.

• 11:49John Coogan?

  Wow.

• 11:50Speaker 03

  It was like a vocab list and it went through.

• 11:52John Coogan?

  Okay.

• 11:53Speaker 03

  Yeah, middle age history, I think.

• 11:54John Coogan?

  Wait, oh, you used Notebook LM?

• 11:56Speaker 03

  Yeah, it generated podcasts. So I basically fed in a vocab list of like dates and various things. Then I had it.

• 12:02John Coogan?

  Wait, and was it just a general podcast?

• 12:06Speaker 03

  Uh, it was really easy. I think I probably aced it.

• 12:08John Coogan?

  Wow. There we go.

• 12:14John Coogan?

  He needs a better confidence monitor. But I was, I was, I mean, first off, I'm, I'm, I'm a big fan of that new trend that's like asking old people like, how did you write a five paragraph essay without AI? And then the answer is like, buddy, we, we, we wrote a five paragraph essay without even reading the book.

• 12:36John Coogan?

  You just go to Spark Notes or something. But I was, I was interested in, in the evolution of Notebook LM because it's this like, there's this collapsing of capabilities where Sam Altman was recently sort of dragged a little bit for saying like, he would use ChatGPT work to generate a podcast about what's going on in his calendar and the family life and stuff. And people were like, how about you just talk to your kids? But the, the more interesting technical point on that is that, do you even need ChatGPT work to generate you that podcast? Or will the voice mode and the memory feature have enough context to just sit there and talk to you like it's a podcast on the fly? Like, if you keep getting these functionalities for free.

• 13:21Jordi Hays?

  Like live voice.

• 13:22John Coogan?

  Yeah.

• 13:23Jordi Hays?

  If you're trying to learn about a topic, for example.

• 13:25John Coogan?

  Pretty good.

• 13:26Jordi Hays?

  Is probably better than just generating a podcast because a podcast assumes like some certain understanding.

• 13:32John Coogan?

  Yeah, and it's raging.

• 13:33Jordi Hays?

  Maybe, maybe it thinks you understand too much or too little. Whereas voice, you can be like, go down this like.

• 13:39John Coogan?

  Exactly, exactly. It's a choose your own adventure. It's a, it's an expert call. It's a, instead of Notebook LM, it's TIGUS LM or something, basically. I mean, you're talking to an expert and you can just guide the conversation wherever you go. So, uh, will be interesting to see where this goes, what the reception is like. I mean, huge, huge delta divergence between like the, the social media pushback for ChatGPT versus like the app store ratings. Like, there's like a billion people using it, a lot of people just like the product. And then there'll be like someone dunking on it to the tune of a million likes on Instagram. And so what, how do you measure those two things when it comes to an actual consumer product?

• 14:21John Coogan?

  If it's delivering something good, if people are like, if the, if the stated preference is like, I don't like AI, but the revealed preference is like, it's kind of nice to have this thing around the house. It's kind of useful. Interesting to see where it goes. Also, will be very, um, the, the launch of this device will be, uh, very, very interesting to see like how things come together. Like you can see the ChatGPT work, ChatGPT Codex, ChatGPT like coming together into one product. But, uh, like there's a world where this product launches with voice mode and it's not really capable of linking to a cloud Codex instance and writing you software and doing the more advanced things that are required just to accomplish some tasks.

• 15:06John Coogan?

  Like you can go to ChatGPT and ask it to, um, pull down an image from the internet, restyle it, change it, but you can't really tell it to do like 40 of those or like every day forever do a whole host, a whole workflow. But you can in Codex. But, and you can talk to Codex, but it has to be running on a computer and, and, and I would hope that by the time this launches, there's full, like full context. Like I, I was doing some work in Codex and I had a, I had like the output and then I wanted to like generate an image based on that and take it on the go, but I wanted to be able to close my laptop and not, and still be able to access it. So I had to like copy the context window into ChatGPT, just the normal app.

• 15:51John Coogan?

  So then I could like access that information and continue to transform it. And that was something that is like a very, very temporary thing that feels like it's going to be fixed in like a couple of weeks. But there's a whole bunch of these little minor integration issues that probably need to be fulfilled before this product launches and delivers like the full, the full capability of what you can do. Because so many things, so many tasks, instead of just knowledge retrieval, uh, require actually firing up a browser, scraping it, writing some code, downloading things, you know, setting up an actual, uh, service and, and workflow as opposed to just something that can be done within the context window of a single LM interaction. Anyway, let me tell you about Cisco, critical introduction for the AI era.

• 16:34John Coogan?

  Unlock seamless, real time experiences and new value with Cisco. Last top story, a New Mexico judge has ordered Meta to pay more than $900 million and impose new restrictions on how minors in the state use Facebook and Instagram. This is a continuation of the social media addiction. If you're watching this clip on Instagram, let us know in the comments, are you addicted to TVPN reels on Instagram?

• 17:03John Coogan?

  It's not our fault. Apparently it's, apparently it's Facebook's fault. If we, if we got you hooked on this stuff. The ruling requires Meta to establish a $567 million fund aimed at addressing harms linked to its platforms on top of a $375 million in civil penalties previously awarded by a jury. So they're up 900 million, they're very close to a billion dollars and the numbers are going to get bigger from here.

• 17:30Jordi Hays?

  Yeah.

• 17:30John Coogan?

  At least, at least they're going to try.

• 17:32Jordi Hays?

  Okay. So last time we really covered something from this ongoing saga, there was a verdict on March 25th, a Los Angeles jury found Meta and Google slash YouTube negligent for designing platforms harmful to young people. A woman who said she became addicted to social media as a child was awarded 6 million, 4.2 million against Meta and 1.8 million against Google. And, and again, at the time, we had this, I think it was a lawyer on, he was giving his opinion. He was like, this is just the start.

• 18:03John Coogan?

  Yeah.

• 18:04Jordi Hays?

  We were like.

• 18:05John Coogan?

  I was like, no way.

• 18:05Jordi Hays?

  And it's like, the jury has, has, has a verdict.

• 18:09John Coogan?

  Yeah.

• 18:10Jordi Hays?

  To say, you know, talking to the biggest companies in the world, you must pay $6 million, right?

• 18:15John Coogan?

  Yeah, it was nothing.

• 18:16Jordi Hays?

  Like this tiny amount, but it was to one person, right? And so you can imagine as these cases evolve, um, this, this new one is in New Mexico.

• 18:23John Coogan?

  And New Mexico is not the biggest state in the union. It's not the biggest.

• 18:26Jordi Hays?

  But there was also one in, uh, in May 2026, so just a couple of months ago for 9 million, uh, to a school district in Kentucky.

• 18:34John Coogan?

  Yeah.

• 18:34Jordi Hays?

  Same sort of issue. The lawsuit accused Instagram of deliberately using addictive features that contributed to anxiety, depression, self-harm and other problems among students, forcing schools to spend more on mental health services. The district had sought more than 60 million.

• 18:52Jordi Hays?

  And I guess the total payout was 27 million because it was split between YouTube and TikTok and Snap.

• 18:59John Coogan?

  Yep.

• 19:00Jordi Hays?

  And in that case, there was no admission of liability and no required product changes. So, uh, I think it's time to start thinking about what the, the sort of battle that social media has ahead of it, kind of in, in cigarette terms. Tell us about.

• 19:15John Coogan?

  Tobacco master agreement?

• 19:16Jordi Hays?

  Yeah, exactly.

• 19:17John Coogan?

  So the, the tobacco companies wound up getting sued individually initially. And there was, there were a whole bunch of court hearings, very similar to the Senator, we sell ads moment, um, uh, but, uh, more focused on the cancer causing nature of cigarettes. And, um, The question was like, who is ultimately being harmed economically? And you would think it's obvious. The person that saw an ad that made smoking look cool, they picked up a pack of cigarettes. They started smoking and then they got cancer and their life was cut short. They are the victim. They should be paid by the tobacco company.

• 20:00John Coogan?

  That's what would be very logical. That's not what happened. In fact, the tobacco, the tobacco, the tobacco master settlement agreement landed in 1998. And it was agreement between all of the major tobacco companies. There's more nuance to this. One of them broke loose and like testified against the others. It's a crazy story, but that's for another time. In 46 states.

• 20:22Jordi Hays?

  I'm the good cigarette company.

• 20:24John Coogan?

  Basically, yeah. And so they don't have to pay. They're not part of the settlement, so they don't have to pay because they basically snitched on all the others. It's crazy.

• 20:33Jordi Hays?

  They're still, are they still in business?

• 20:35John Coogan?

  Oh, yeah. They're doing great.

• 20:37Jordi Hays?

  Who are they?

• 20:37John Coogan?

  Look at Victor.

• 20:38Jordi Hays?

  Like, I've never heard of it.

• 20:40John Coogan?

  Yeah.

• 20:41Jordi Hays?

  Last name Victor?

• 20:42John Coogan?

  Yeah, they were literally.

• 20:43Jordi Hays?

  They won.

• 20:44John Coogan?

  They won, yeah. There's more nuance to it than that, but, but that's like one way to tell the story. Anyway, so a bunch of the big tobacco companies versus 46 of the United, of the US states, the District of Columbia and several territories. The states agreed to end major lawsuits against the tobacco companies. So the same thing was happening where all the different states were suing and they were suing because the negative externality of cigarettes causing cancer was driving up medical bills in the states. So the states have healthcare and they assume, hey, okay, we're going to spend this much on doctors, this much on radiology, this much on X-ray equipment. And then all of a sudden they're starting to look at their populations and saying like, wait, everyone's getting lung cancer? We're not equipped to deal with lung cancer.

• 21:29John Coogan?

  We need to hire way more oncologists and cancer doctors who specialize in lung cancer. We need equipment. We need drugs that treat lung cancer. There's a whole bunch of other things that we have to spend money on. And so you got to pay us because you, the tobacco company, are responsible for us running out of money for our healthcare system. And so that was the nature of these, like the battles between the states and the big tobacco companies. You would think it would be the individuals who got the cancer. That would be very logical, but that's not actually the structure of this deal. And so in return, the companies, all the states said, hey, we'll drop all those lawsuits. You won't have to, we won't be nickel and, nickel and diming you across every single state.

• 22:08John Coogan?

  Instead, the, the companies will make large payments and follow new limits on advertising and business practices. So the end result, the headline number is 206 billion, which feels like small relative to today's standards of like hyperscalers in social media. Facebook generates roughly 200 billion in revenue every year, although if they got hit with a $200 billion fine, that would be existential. But what happened with the master settlement agreement with tobacco companies was that there wasn't just one fixed payment. Instead, it created a system of annual payments that continue indefinitely. They will actually have to pay forever as long as they are in business. They have like effectively a special tax paid to them.

• 22:53John Coogan?

  And the amount changes based on cigarette sales, inflation, market share and other, other adjustments. So if cigarette sales, sales fall, the total payments usually fall. And that's a big reason why there's like a shift to non-cigarette products.

• 23:08Jordi Hays?

  Well, and that just naturally makes sense. If less people are buying cigarettes, less people are going to have health issues.

• 23:14John Coogan?

  Exactly, exactly.

• 23:15Jordi Hays?

  Yeah, so, so I brought it up because I think that we could be heading in that direction with social media.

• 23:21John Coogan?

  There's also a fascinating dynamic because these states now have an indefinite revenue stream that will be paid to them. And you can model that out financially and you can financialize it and a lot of people have. And so investment firms and banks and, and financial institutions have come in and said, okay, you are the state of New Mexico, for example, and you are expected to get 300 million from big tobacco this year. And then next year we think it'll be 297 and then 298 and then, and then it'll go down. And we can model that out and we can just give you $4 billion right now in exchange for that revenue stream or a piece of that revenue stream.

• 24:02John Coogan?

  And then those states can take that lump sum of cash and build a new, you know, bridge or something like that, whatever they need, whatever they need to do. So there's been a lot of financialization on top of it. And so each tobacco company pays a share of the total amount. It's shared depends mainly on the share of cigarette sales among companies that participate in the MSA. The settlement then divides the money among states using fixed allocation percentages. Some states later borrowed against these future payments by issuing bonds backed by MSA revenue. The MSA also limits tobacco advertising and marketing, especially marketing that could reach children in simple terms. The agreement created a permanent system. Major tobacco companies receive protection from many state lawsuits while states receive continuing payments and new enforcement powers.

• 24:46John Coogan?

  The result is not just a legal settlement. It created this long-term financial and regulatory structure built around cigarette sales. And it's now the 10-year anniversary of Starting Lucy, 2016. August 8th, technically was the day. New regulation.

• 25:01Jordi Hays?

  You know what I'm going to hit.

• 25:03John Coogan?

  Overnight success. Yeah, for sure.

• 25:06Jordi Hays?

  The exact opposite, slaving away for years in obscurity.

• 25:10John Coogan?

  But very, very interesting, very, very interesting industry to have operated in for as long as we have. What else is going on? Let me tell you about Railway. Railway is the all-in-one intelligent cloud provider. User favorite agents deploy web, app, service, databases and more. Well, Railway automatically takes care of scaling, monitoring and security.

• 25:29Jordi Hays?

  Semi Analysis chimed in on the Deep, DeepMind news, not just chimed in.

• 25:36John Coogan?

  I think the term's posterized.

• 25:38Jordi Hays?

  Grave digging?

• 25:39John Coogan?

  No, not, grave dancing.

• 25:42Jordi Hays?

  No, they're.

• 25:42John Coogan?

  Grave digging? They're digging the grave.

• 25:44Jordi Hays?

  Yeah.

• 25:45John Coogan?

  And then they're dancing on it at the end.

• 25:48Jordi Hays?

  Anyway, Semi Analysis says, for all intents and purposes, we believe DeepMind is no longer a frontier lab due to large numbers of departures from their RL teams and poor compute allocation. Google will continue, continue meandering on and releasing models, but their odds of ever reaching state of the art again have dropped to zero. Damn it. Google is now simply unable to retain top AI talent. Again, this is what I was saying the day that the news broke. It's like researchers want to work with great researchers, right? And so the more talent density you have, the easier it is to recruit. And yeah, Gnome leaving earlier was like a canary in the coal mine.

• 26:33Jordi Hays?

  Obviously, these are not the actions of people excited about Gemini 4 Pro. Jeff, Sanjay, Quokk and Oriole are just the latest in a long string of high-profile departures from DeepMind. Jeff Dean, Jeff Dean is the undisputed GOAT of Google engineering, co-founded Google Brain and started the TPU program. Google, on the other hand, decided it was totally worth it to sell enormous amounts of compute to Gemini's fiercest competitors on long-term contracts without any hope of ever returning it to DeepMind. More than 20% of total TPU shipments from third quarter '26 to fourth quarter '27 are being sold directly to Anthropic. The issue with Google was not Jeff Dean nor Gnome Shazir, but rather their extremely bureaucratic, painfully slow and strategically timid culture.

• 27:18Jordi Hays?

  Google will join the ranks of other legendary tech giants like IBM and Intel to give up on the harder thing and do the thing that will make you more money. It becomes demoralizing as many of the great technology leads have left.

• 27:32John Coogan?

  Wow.

• 27:33Jordi Hays?

  And take him, taking a victory lap. He wrote a piece on July 21st, "Google is a secular short", kind of getting at a lot of these issues, so.

• 27:45John Coogan?

  Brutal, brutal stuff. This is insane. On the other side, GCP is working. GCP is basically a money printing machine. No wonder Google executives are choosing GCP over Gemini. So although EBIT margins for these system sales are slightly lower than core cloud margins in the low 30% range, we still expect total GCP to deliver mid to high 30s EBIT margins going forward. How, how investors decide to capitalize the current TPU backlog and any large future sales is an open question. However, given the strong compute demand from the labs, we expect more multi-gigawatt deals to be announced soon, adding to this backlog. In all, we estimate that over 250 billion additional TPU bookings could be added to GCP RPO in the next coming quarters from Semi Analysis.

• 28:30John Coogan?

  Very interesting. I mean, there, there is like a, like a positive spin on this, which is like, they seem to be really good at chip development, really good at cloud, like focus where you're, where it's working. And you don't have any tensions there because you have excellent teams. And then you have the ability to underwrite that build out with the cash machine that is Google Search and, and YouTube and their ads products. And, and having more of this like barbell approach as opposed to playing in like the middle race is maybe the, maybe ultimately the right thing to do. There are plenty of hyperscalers that have lived that and are doing very well on the back of it. That haven't, like Microsoft, Amazon, for example, they've been partners to labs at various points

• 29:14John Coogan?

  and, and are very good at building data centers, very good at, at, at scaling and have not tried to really go on a crazy poaching race and amass the, the, the dream team. And, you know, they've been rewarded for it.

• 29:30Jordi Hays?

  Yeah. Still, wild series of events. They obviously had effectively a version of ChatGPT internally. They didn't ship it. Tebow, who's now running Chat Codex, was there working on that product, which is really wild. Sebastian Malaby says, "Semi Analysis is excellent, but this argument strikes me as paradoxical."

• 29:52John Coogan?

  Oh, he messed up the tag though. Semi Analysis underscore.

• 29:56Jordi Hays?

  It argues that Google is out of the AI frontier race and that too, Google's AI revenues will meaningfully accelerate because Google is allocating compute to its Google Cloud customers. I wonder, in the long term, isn't a strong revenue base an essential underpinning of success at the AI frontier? Consider this thought experiment. If Nvidia acquired OpenAI but continued to sell compute to multiple customers, would this make OpenAI weaker or stronger? Surely, the answer is stronger. I think Sebastian just kind of fundamentally misunderstands the current dynamics. But Tyler, you want to break it down?

• 30:36John Coogan?

  Does he have something here?

• 30:38Jordi Hays?

  No, we were talking about this before the show, this idea that

• 30:42John Coogan?

  I guess the question is

• 30:43Jordi Hays?

  Like, like, the, like, this race is all about compute allocation.

• 30:47John Coogan?

  Yeah.

• 30:47Jordi Hays?

  You want to be allocating compute to training so you can maintain your lead or extend your lead or get to the frontier. Google's effectively saying, we're going to allocate, instead of allocating, you know, let's say, and OpenAI is allocating like 50% of inference to, 50% of compute to inference, 50% to training, right? Google's now shifting towards, you know, I'm sure they're going to be effectively allocating 90% of their compute to just allowing

• 31:15John Coogan?

  I think the number was 15% was for GDM relative to the overall cloud.

• 31:20Jordi Hays?

  Yeah, exactly.

• 31:21John Coogan?

  Compute.

• 31:21Jordi Hays?

  Yeah.

• 31:22John Coogan?

  So, yeah, it was like, that must be frustrating, but still a lot. I mean, there is a world where you could, like, sit this round out and then grow your company, grow your compute, and then rug all the labs, have all the data centers, like, the Tyler Cosgrove, like, keep the chips for yourself model, like, that could happen in 2028. And then every other lab is, like, compute poor because Google just said, like, actually, we're taking back all the labs, we're doing the biggest training run of all, but that's sort of is negated by the idea of, like, a flywheel and, you know, and, like, needing

• 32:05John Coogan?

  an RL loop around the code and the use cases and the rollouts. So it'd be very, very tricky. But if, but if there's some world where it's like, they create the next transformer magically and you don't need a lot of data for it, you just need more compute than anyone else has and they have a lot of it loosely.

• 32:20Jordi Hays?

  Yeah, and also, what models are they going to be using for their own research when the other labs are not exactly saying, hey, use our frontier model to train a frontier model yourself?

• 32:30John Coogan?

  Yeah, that is tricky.

• 32:31Speaker 03

  Yeah, it just seems like Google leadership has a very different idea of, like, where value accrues in AI than, like, Demis or, like, the other labs, right? It's like, it's not actually, like, the model itself.

• 32:42John Coogan?

  Yeah.

• 32:43Speaker 03

  It's, it's the, like, infrastructure, GPUs, cloud, cloud business.

• 32:47John Coogan?

  It's interesting because you can run back the old Demis quote about, like, he went, when he was selling DeepMind, he talked to Mark Zuckerberg and is like, what are you excited about in the future? Are you excited about AI? And Mark Zuckerberg, apparently, according to this exchange that Sebastian Malaby reported on, Mark Zuckerberg says, oh, yeah, I'm super excited about AI. And then Demis is like, I'm going to test this guy. I'm going to see if he's a true believer. What do you think about VR? And Zuck's like, oh, VR is, like, equivalently as big? And then Demis is like, no!

• 33:14Jordi Hays?

  I don't think he even said that. He was just equivalently as excited.

• 33:16John Coogan?

  Yeah, yeah, excited. And he was excited about a few other things. And Demis was like, I want to be with someone who's, like, all in on AI as a fundamentally different technology, not a normal technology, not like VR, not like new devices, not like electric cars, not like, you know, satellites in space. It needs to be considered as a completely separate, sort of, like, you know, development, a completely separate technology.

• 33:42Speaker 03

  Yeah, like, I don't know if Sundar, like, believes in RSI. I don't, it seems like he doesn't think that that's, like, really going to

• 33:48John Coogan?

  So the point is that Demis should have prayed more and said, like, well, how excited are you about cloud?

• 33:55John Coogan?

  How excited are you about AI overviews? And if Sundar, it wasn't Sundar back then, but if Google was like, oh, yeah, we're equivalently excited about cloud infrastructure as ASI, then that should have been Demis's moment to be like, ah, maybe I shouldn't.

• 34:14Jordi Hays?

  The only thing, the only thing is, there's a world where he's actually so RSI-pilled that he's thinking, okay, it's over for us, I need to back up the Brink's truck and help, help Anthropic, right? Putting together this, like, you know, almost a quarter of a trillion dollar financing package.

• 34:29John Coogan?

  Yeah.

• 34:31Jordi Hays?

  And variety of

• 34:32John Coogan?

  Yeah.

• 34:32Jordi Hays?

  data center guarantees to enable Anthropic to scale up, even though they don't have, you know, really access to the debt markets in the way that Google does.

• 34:43John Coogan?

  And there's also, there's also the, just this idea of, like, there are multiple waves to move the needle and put points on the board in just the successful rollout of AGI ASI. And one of those is working for a lab, developing the next model, making sure it's aligned, et cetera, et cetera. There is another, which is, like, go and create public policy. There is another that is, you know, work at a nonprofit. Like, I think if you talk to the folks at, at Meter, for example, they don't feel like they're, like, sitting out AGI. Like, they're very important in that story, in that role. They have less of a financial, like, alignment to it, but they definitely see themselves

• 35:26John Coogan?

  as, as participating and, and, and working towards the good outcome, which is what, which is what drives a lot of people, especially when you're post-economic.

• 35:35Jordi Hays?

  Google's ownership in Anthropic is capped at 15%. They, I believe, have roughly 14%.

• 35:41John Coogan?

  Weird. Why, wait, well, how is it capped?

• 35:43Jordi Hays?

  I think Anthropic just didn't

• 35:45John Coogan?

  Oh, we don't want you to have

• 35:46Jordi Hays?

  They don't have any voting rights. They don't, they don't even, they're not even a board observer. They don't have a board seat. They basically are just a, yeah, purely financial backer.

• 35:56John Coogan?

  Let me tell you about Console. Console builds AI agents that automate 70% of IT, HR, and finance support, giving employees instant resolution for access requests and password resets. And let me also tell you about Public, investing for those tickets seriously. They've got stocks, options, bonds, crypto, treasuries, and more with great customer service. A branding mogul's Miami Beach home lists for $68.5 million. Branding mogul Nick Woodhouse was sailing around Miami for his birthday in 2019 when he realized he'd found his new home. Turning to his wife, Joseline Woodhouse, the Canadian-born businessman said, we have to live here. It wasn't long after relocating from New York in 2020 that the couple, then living

• 36:38John Coogan?

  in a condo on Sunny Isles Beach, Florida, saw a waterfront lot on a guard-gated La Gorge Island? Is that how you pronounce it? La Gorge? I don't know. Island in Miami Beach from a friend's boat. The property had the foundation of a house that was just starting to be built. The Woodhouses purchased the partially-built home for $17 million in 2021 and completed construction of the roughly 8,800-square-foot, seven-bedroom contemporary house around 2023. It's a 0.4-acre estate and they're selling it for 68.5 because they're building another home nearby. Nick is the former president and chief marketing officer of Authentic Brands Group, and that's why I wanted to talk about this, because Authentic Brands is a very fascinating company. Tyler, you have something here?

• 37:22Speaker 03

  Yeah, so it's pronounced La Gores.

• 37:24John Coogan?

  La Gores.

• 37:25Jordi Hays?

  Thank you.

• 37:26John Coogan?

  La Gores. Well, Authentic Brands Group is a very interesting lifestyle platform, I guess. I don't know exactly what you would call it, but

• 37:35Jordi Hays?

  They have, they have some truly tier-one assets.

• 37:39John Coogan?

  They own more than 50 consumer brands, as well as likenesses and estates of celebrities, including Muhammad Ali, Elvis Presley, and Marilyn Monroe, but what stuck out to you?

• 37:49Jordi Hays?

  Let's start at the top.

• 37:51John Coogan?

  Okay.

• 37:51Jordi Hays?

  Cream of the crop. They own Tapout.

• 37:55John Coogan?

  They do.

• 37:55Jordi Hays?

  Iconic brand.

• 37:56John Coogan?

  Tapout tees.

• 37:57Jordi Hays?

  Iconic brand. And if you guys ever run into John on the weekends, he's almost certainly head-to-toe Tapout.

• 38:03John Coogan?

  It was one of their first purchases, Silver Star and Tapout. In January 2011, they acquired the rights to the likeness of Marilyn Monroe. So if you see Marilyn Monroe on a T-shirt, Authentic Brands is getting a check.

• 38:17Jordi Hays?

  They own Ruka, the surf brand, they own Neiman Marcus, they own Prince, they own

• 38:22John Coogan?

  Brooks Brothers.

• 38:22Jordi Hays?

  Goodman, they own DC Shoes.

• 38:24John Coogan?

  Yeah.

• 38:25Jordi Hays?

  They own Sperry's, they own Barney's, they own Saks Fifth Ave, they own Sports Illustrated.

• 38:30John Coogan?

  Wow.

• 38:31Jordi Hays?

  They have the Elvis Presley NIL.

• 38:34John Coogan?

  Yes.

• 38:35Jordi Hays?

  They have the Muhammad Ali NIL.

• 38:37John Coogan?

  Yes.

• 38:37Jordi Hays?

  Forever 21.

• 38:38John Coogan?

  Yes.

• 38:38Jordi Hays?

  They own Roxy. They own Volcom.

• 38:41John Coogan?

  And what other celebrity?

• 38:42Jordi Hays?

  Volcom, again, to me, to me, if I, you know, you know, Tyler, I know, I know you're still, you're pretty much head-to-toe Volcom at all times. Volcom, maybe some Billabong thrown in there. Well, they also own Billabong.

• 38:55John Coogan?

  Yep. They own it all.

• 38:57Jordi Hays?

  And so they own Lucky, they own Eddie Bauer.

• 39:00John Coogan?

  They also own Shaquille O'Neal's likeness.

• 39:03Jordi Hays?

  And Kevin Hart's likeness. And David Beckham's.

• 39:07John Coogan?

  Wait, the A-Star venture capitalist? Kevin Hart's?

• 39:10Jordi Hays?

  No, no, I don't think they could afford his NIL.

• 39:12John Coogan?

  Oh, okay.

• 39:13Jordi Hays?

  But the actor, comedian, tequila entrepreneur.

• 39:16John Coogan?

  Yeah. I think it's so funny

• 39:18Jordi Hays?

  Champion, Reebok.

• 39:19John Coogan?

  Shaquille O'Neal sold his likeness before he passed away? I feel like selling your likeness and your estate and going on T-shirts and stuff is something that you would hold on to. I mean, I understand selling your catalog if you're not a recording artist anymore, but just selling your actual likeness and then people getting, oh, yeah, you can you

• 39:39Jordi Hays?

  No, you saw it during the World Cup, like, David Beckham was in every other ad. And it's because he did a big deal to basically sell his, like, all of his

• 39:48John Coogan?

  Wait, so

• 39:48Jordi Hays?

  And so he's basically, he basically pulled forward

• 39:52John Coogan?

  Yeah.

• 39:53Jordi Hays?

  years and years and years of, like, NIL revenue.

• 39:56John Coogan?

  But how does that work if he actually needs to be on-site to, like, film commercials?

• 40:00Jordi Hays?

  Probably has some obligation, like, you need to be available

• 40:02John Coogan?

  This many days? Wow, that's very interesting. Anyway, Nick is the former president and chief marketing officer of Authentic Brands Group, a licensing and managing company that works with companies such as Reebok, Champion, and Brooks Brothers.

• 40:14Jordi Hays?

  TZH says, ABG is a graveyard for iconic brands.

• 40:19John Coogan?

  It's the bending spoons of brands.

• 40:20Jordi Hays?

  No, it really is. I mean, it's somewhat sad because a lot of these brands, they

• 40:27Jordi Hays?

  A lot of these brands are so, so iconic and with the right, with the right sort of management and investment, they, they would be back to their former glory. I, the, a lot of the surf brands and the skate brands are a little sentimental for me, just because I grew up watching so much of the content that those brands put out and, and following the different athletes on their teams. But those, those industries have just been impacted, surfing most aggressively, just because kids that don't live by the ocean now, they don't really care about surfing.

• 41:04John Coogan?

  Yeah.

• 41:05Jordi Hays?

  They care about Chrome Hearts.

• 41:06John Coogan?

  Hmm.

• 41:07Jordi Hays?

  And so.

• 41:08John Coogan?

  Do you think the surfing industry needs a federal backstop?

• 41:11Jordi Hays?

  I would push for one, certainly.

• 41:12John Coogan?

  Yeah.

• 41:13Jordi Hays?

  Yeah.

• 41:14John Coogan?

  Couple, couple billion dollars from the treasury directly to get Volcom.

• 41:18Jordi Hays?

  Quicksilver, Billabong.

• 41:19John Coogan?

  Quicksilver, back to, back to the top.

• 41:21Jordi Hays?

  Roxy. Yeah. We're onto something here.

• 41:24John Coogan?

  I think so.

• 41:25Jordi Hays?

  This is our new platform.

• 41:25John Coogan?

  I think so. 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. There's one more key story. We have our next guest joining in just a minute. Samir Call from Coastal Ventures. But a golden retriever made the front page of the mansion section in the Wall Street Journal. It's huge news. Golden Retriever's name is George. Isn't that an amazing name? Mad cliff top dream on the Irish coast. Couple wanted a home on the edge of the sea, so they braved 75 mile an hour winds to turn a former sea urchin farm into a modern light filled house. And the golden retriever fully delivered in

• 42:08John Coogan?

  this photo shoot. I love some of the photos of this dog. I was very happy to see George get the full Wall Street Journal treatment. It's always a good day when there's a retriever in the journal.

• 42:19Jordi Hays?

  The chat is in full support of regulatory capture for skate brands.

• 42:24John Coogan?

  For skate brands. Yes.

• 42:26Jordi Hays?

  C C shoes.

• 42:27John Coogan?

  Yeah. Do you think there should be sort of like an FDA?

• 42:29Jordi Hays?

  D C shoes. It's only right that Washington DC.

• 42:32John Coogan?

  Yeah.

• 42:32Jordi Hays?

  Would take a position.

• 42:34John Coogan?

  Do you think there should be sort of like a, like a skate brand FDA? So like if you're coming up with a new tap out tee design, it has to be reviewed by a federal authority?

• 42:44Jordi Hays?

  Tap out safety.

• 42:45John Coogan?

  Yeah, exactly. To make sure it's not too extreme, too aggressive.

• 42:48Jordi Hays?

  Yeah.

• 42:49John Coogan?

  That might get someone to.

• 42:49Jordi Hays?

  Scare the children.

• 42:50John Coogan?

  Yeah. Because you don't want to inspire a, a young skater to take a 12 stair when they're not ready, you know?

• 42:55Jordi Hays?

  Yeah. And some of these brands are, you know, sales are in decline. And if, if, if, if they knew that the government would, you know, place effectively provide that demand signal.

• 43:05John Coogan?

  Yep.

• 43:06Jordi Hays?

  They could ramp up production.

• 43:07John Coogan?

  Significantly.

• 43:08Jordi Hays?

  Reinvest in campaigns.

• 43:09John Coogan?

  Significantly.

• 43:10Jordi Hays?

  And many of the athletes.

• 43:11John Coogan?

  Yeah.

• 43:12Jordi Hays?

  Yeah. This is, this is our new platform. We don't talk, we, we stay out of politics.

• 43:16John Coogan?

  We stay out of politics, but maybe the FCC should do sort of like an equal time rule on, on television. You know how it's like, if you're talking about a Republican, you need to get equal time to the Democrat? It should be like, if you're gonna, if you're gonna talk about Pepsi and Coca-Cola, you need to get equal time to Volcom.

• 43:30Jordi Hays?

  Yeah.

• 43:30John Coogan?

  Right? Yeah. I think that makes sense. Anyway, let me tell you about CrowdStrike. Your business is AI. Their business is securing it. CrowdStrike secures AI and stops breaches. Our next guest is Samir Call from Coastal Ventures, his general partner, and he's the latest backer of Discovery Loop. Samir, how are you doing?

• 43:46Jordi Hays?

  What's going on?

• 43:47Speaker 04

  You're doing, you're doing great.

• 43:49John Coogan?

  Yeah. I can imagine you got, you got a stake in the next Jeff Dean, the first Jeff Dean company. How did that come together? How excited is the firm? Tell me about the thesis behind Discovery Loop.

• 44:01Speaker 04

  Well, look, I mean, we've known Jeff Dean forever. You know, we know when he was at Kleiner, was the first investor in Google. Jeff's been involved in just about everything that's important that Google's, Google Brain, TensorFlow, TPUs.

• 44:17John Coogan?

  Yep.

• 44:18Speaker 04

  And he was there 27 years. And it's kind of one of those dreams when someone like Jeff calls you and says, hey, I'm going to do a startup. Do you want to invest?

• 44:26John Coogan?

  Crazy.

• 44:27Jordi Hays?

  Yeah. Did you guys need to look at the deck or did?

• 44:30Speaker 04

  No, no. There's been all this talk about his deck.

• 44:33Jordi Hays?

  Yeah. I was surprised. I was like, why did you make, why did you even make a deck?

• 44:37Speaker 04

  We're co-leading the round and I haven't seen a deck. So who's seen this deck?

• 44:43John Coogan?

  That's very funny. But I, I think what stuck out to me was if you dig into the blog post and you look at how Jeff is thinking about the impact that AI can have, it, it struck me as a real focus on tangible results. There's, you know, making solar power more economical. And that's obviously downstream of a lot of hard engineering and AI research and then models that can go and do that. But having that laser focus on the impact that I think everyday people can rally around felt much less abstract and much more of a positive signal. How do you think about grappling with that, where it goes, and also

• 45:26John Coogan?

  just, hey, you know, this is a new company. There's going to be a lot of exploration. Let's keep the aperture really wide.

• 45:32Speaker 04

  Well, you want to keep the aperture wide, but what you brought up is exactly why. You've read about all these other Neo Labs that have started post OpenAI and Anthropic. And we've passed on, I think virtually all of them. And the reason was, is you've got, and trust me, these Neo Labs are started by all-stars. These are superstars, super talented individuals. But that alone doesn't justify the kind of money and the kind of valuations and things like that, that these companies are commanding. We didn't see.

• 46:07Jordi Hays?

  That, but also the, the, sorry to interrupt, but I've always thought about the competitive dynamic. Frontier Lab comes out with, you know, a model. A few months later, there's an open source version of it. To me, why doesn't that, you know, as we see a Neo Lab have a meaningful breakthrough, why does the same thing not happen where a Frontier Lab ends up recreating what the Neo Lab has built and they have the scale and the distribution to just immediately roll it out to millions of businesses all over the world. And so when I've looked at some of these Neo Lab opportunities, I'm just thinking, like, even if you have this like meaningful breakthrough, how do you actually capture the value associated with that without just selling back to one of the bigger labs?

• 46:52Speaker 04

  You're absolutely right, which is why we've stayed away from them. We couldn't see a clear path to something that's meaningfully differentiated from the Frontier Labs. And then as such, you worry about the sustainability and the mode they create. And what Jeff and his team are doing, first of all, they're really, that's a, they're a one-on-one team. You look at what they've done, it's amazing. They've been at Google 27 years and now they lift their heads up to do something different. It clearly suggests that they've decided this is something very meaningful. Otherwise, why put their legacy at risk? It, you know, it's just incredible. And to your point, John, what they're doing is exactly that,

• 47:34Speaker 04

  is saying, look, we're going to take research and we're going to figure out if you run this experiment, what do we think the outcome is? And based on that outcome, let's run thousands or millions of other parallel experiments and try to get to an answer. So it could be, what's the new material for magnets for a fusion reactor? It could be, what are new materials for solar cell to make it more efficient? It could be for batteries. It could be for scientific research. And just think about, you know, in some ways, it's like coding. Why are all these code startups doing very well? Factory, cognition, a couple that we're involved in, is because you, you can get a real time affirmation of

• 48:17Speaker 04

  what you're doing. Is it correct or not? Does it spit out good code that does well? That's a good answer, short term. And I think that's what Jeff and his team are trying to do with research also is get, is prove that what they're doing actually has value in a short cycle so that you can then improve upon it.

• 48:36Jordi Hays?

  How important do you feel like the work is in general right now? If you look back at the, the breakthroughs over the last couple of weeks, we got a bunch of new viruses that never existed before, and we solved some, you know, pretty impressive, you know, math problems. But the general population, I don't think is going to get that excited about either of those at a time when the, the data centers are getting built, but you know, there's pushback everywhere. And I think the general population.

• 49:05John Coogan?

  Don't forget, they also accidentally hacked a whole bunch of systems.

• 49:08Jordi Hays?

  Yeah, yeah.

• 49:08John Coogan?

  That's another one.

• 49:09Jordi Hays?

  Viruses.

• 49:11John Coogan?

  Accidental hacking.

• 49:12Speaker 04

  Yeah.

• 49:13Jordi Hays?

  Math problems, all, all impressive.

• 49:16John Coogan?

  Yeah.

• 49:16Jordi Hays?

  In their own way, but certainly not going to get anyone.

• 49:20Speaker 04

  Well, the locusts haven't, the locusts haven't come yet, so I think we're still okay for a little bit. But, but, but, but, um, look, uh, let's go through each of them. So first of all, what it can do in math is just incredible. So that just shows the power. There's, I'm not sure there's a practical use there, but it shows the power of these models and how quickly they learn and can iterate. And it's not really that surprising, right? Because you're the smartest human processes data, it's still at less than 100 bits a second. But in a GPU processes data at eight trillion bits a second. So how is it, you know, of course, it's going to do things that humans can't do in a, in a way

• 50:01Speaker 04

  that we've not been able to do it. On the virus side, that's scary. And that gives it, that's a perfect example of why we can't regulate our US companies in AI. We have to stay ahead and be at the cutting edge so we know how to protect ourselves. The worst thing we can do is over-regulate US companies and give the advantage to our adversaries where we don't know how to, to defend ourselves.

• 50:30John Coogan?

  I'm interested to hear a little bit about the shape of COSLA, the strategy, and it'd be interesting to ground it in the, the shape of value add for a company like Discovery Loop. Obviously, Jeff Dean and the technical talent is incredible. But being, I think, basically first time founders this late in your career, is there actually a lot of value add that you can bring to the table with recruiting and setting up the rest of the structure? Like, I imagine Jeff Dean has not had to run payroll ever, or like, deal with like hiring a great HR lead or, or a great CFO. And if you're, if you as, through your network can sort of build out the rest of the shell very easily, that feels

• 51:13John Coogan?

  like actually incredibly impactful. But how are you thinking about helping a company like Discovery Loop in any way you can?

• 51:20Jordi Hays?

  I think when Jeff Dean is in the presence of payroll, it just runs itself.

• 51:25Speaker 04

  I was going to say, I think Jeff could probably, I think by the time, by the time you get a cup of coffee at Starbucks, I suspect Jeff can code an agent that does all the payroll for you.

• 51:35John Coogan?

  That's probably right.

• 51:37Speaker 04

  Uh, you know, so look, one, we're super honored. I think Jeff could have picked any VC in the planet and the fact that he picked us as one of two to co-lead it is just a huge honor and a huge responsibility. So we have to add a lot of value to justify his trust in us. And so, you know, I'm very proud of at our firm, one, every managing director is an entrepreneur. Uh, we're all technical. I have four nature papers, a science paper before I'd ever seen a P and L. Uh, so, oh, nice. I got a gong. Great.

• 52:15Jordi Hays?

  That's an air horn. We'll, we'll, we'll save the gong for later.

• 52:19Speaker 04

  Okay, great. All right, air horn. So, uh, the point is that I think, uh, where we'll add value is we've built a great platform team and the goal there has been that these are people, whether it's recruiting, design, sales, marketing, uh, branding, et cetera, that startups otherwise wouldn't be able to afford. Now Jeff could afford anybody, but these are people that could really help him hopefully build out the team, uh, figure out the right incentive structures, uh, make the type of introductions that he would need, um, and be sounding boards for advice. I think Jeff did, didn't want people that were just going to sit back and cheerlead him. I think he wanted people that were going to

• 53:02Speaker 04

  push back on him and, and help him shape it.

• 53:05John Coogan?

  Um, I want to get your take on, uh, sort of an odd venture strategy. I don't know if anyone's actually running, running this playbook, but, uh, I think your pushback here will be interesting. So let's say that I'm sort of cynical about, uh, these like billion dollar seed rounds broadly, Neo Labs, whatever you want to call them, like huge amounts of money, basically, basically growth stage from day one. But my thesis is not that they're going to overtake any of the leaders, but that there will be liquidity through acquisitions, that a $10 billion acquisition is becoming more normal. And so I can still underwrite a fund based on that, but that feels sort of antithetical

• 53:47John Coogan?

  to venture. But is there something there? Are you seeing that? Or have you been very conscious about staying out of that particular, uh, profile because you want to go back to thinking in decades, thinking about really long tail outcomes?

• 54:01Speaker 04

  There's always exceptions. So I'm certain that we've fallen into some of those exceptions, but by and large, I don't think that strategy will work. Uh, I, I, I think, uh, first of all, you've seen some of the recent acquisitions, um, Windsurf, Scale AI, where they've been pseudo, pseudo acquisitions, where the investors have not gotten anywhere near what the headline price is. Individuals, uh, have captured a lot of value, but investors have not. So I don't believe that the, and if you make an investment, assuming an aquahire is going to be the outcome, then you're going to be, you're going to lose. And, and who

• 54:42Speaker 04

  cares about returning capital? You know, the beauty of our business is that we can only lose one times our money. But on companies like OpenAI or other companies, we can make a thousand times our money. And so, you know, we'd never invest being like, hey, well, let's invest and at least we'll get our money back. That makes no sense in a business that affords you a failure rate of 60 or 70%. And in fact, I'd argue if you don't fail 60 or 70%, you're not taking enough risk to justify the risk premium that our investors take when they invest in funds like ours.

• 55:16John Coogan?

  Yeah. Jordy, please.

• 55:19Jordi Hays?

  How do you, how do you see the current private market dynamic playing out? It's, uh, I, I've been very, uh, I've been a little bit concerned lately because, you know, we, we have a lot of founders on the show. A lot of them are building great companies. Hopefully most of them are. Uh, but every single day, there's half a billion dollars raised here, a billion dollars, you know, uh, raised here. And, uh, it's been going on for so long now. And it's basically like a debt that the, that venture is like building up, right? This is like money that needs to be returned at some point. Um, and, you know, there's just such a massive disconnect. There's even companies that are effectively, uh, if they

• 56:03Jordi Hays?

  were public, they would be seen as SaaS companies, but because they're private and they use models, they're viewed as AI companies, wildly different, wildly different revenue multiples and, and value placed on them. Um, and yeah, I'm, I'm curious how long you think this can, can go on. Um, and if it ultimately even matters, right? You know, you've seen SpaceX pay for, you know, uh, 10,000 terrible venture investments, right? Um, and, uh, I hope that many of the LPs that, that weren't all the bad ones are, were in SpaceX in some way or another, and hopefully they made it back. But how do you see this playing out? How long can this current, uh, super cycle go on?

• 56:46Speaker 04

  Well, well, well, let's zoom out. So what you're, you're, you're, there's a lot of truth to what you're saying. So remember when the word unicorn came out, it was meant because a billion dollar company was such a rare event, like a unicorn. And now you're having a unicorn born almost daily. Uh, so there's that. On the flip of that, remember, I mean, I'm old enough to remember the dot com era and the dot com era, uh, Cisco was approaching a trillion dollar market cap and people thought that was insanity. They're like, how could, how in God's name could there be a trillion dollar company? There's just no way. And now how many are there? 15 or 20? So, you know, when you've, when

• 57:27Speaker 04

  the upside has now moved for where a billion, just in last, what, when was unicorn coined? 15 years ago? 16 years ago, maybe? Uh, so in, in

• 57:37Jordi Hays?

  Yeah. And around that time, DeepMind was, Demis was doing like a 50% dilution round at like a low, single digit.

• 57:45Speaker 04

  YouTube was acquired for $1.8 billion. That would be a trillion dollar company today. Right? Instagram was bought for a billion dollars. That would be a trillion dollar company today. WhatsApp was the largest private venture acquisition at the time for $19 billion and that would be a trillion dollar company today. I mean, so think about how fast we've gone for where a billion dollar company was a unicorn to where now a trillion dollar company is a unicorn. That's three orders of magnitude of market cap in a decade. So that's the backdrop. Now, yeah, I think, and we're in a hits business. No one cares what our slugging percentage is, what our batting average is. They care about what is

• 58:30Speaker 04

  our, how many dollars do we give you and how many do you give us back? And if it's, you know, better than three or four X and better than a 20% net IRR, we're going to keep giving you money to do what you're doing. And it's, and the only way, what I worry about most, Jordy, is that people aren't taking that type of risk. They're not going in, taking big risk, owning 20% of the company, helping build it, as opposed to just joining the, putting all of their fund in these party rounds, these companies that are valued tens of billions of dollars. I don't believe aquahires are going to be effective at all at returning capital to people versus the, versus actually, versus saying like what

• 59:12Speaker 04

  we're doing is we'll take a portion of our fund. When a Jeff Dean shows up, we'll take a portion of our fund and put it towards something like that because that's something you can't say no to. But primarily, we're going to do things like we, uh, did with Commonwealth Fusion, uh, you know, helped incubate it, got it off the ground. Rocket Lab, we were the first investors. We put in, I think, $5 million for a third of the company. It was a company in New Zealand. No one was paying attention to it. And we owned 28% of the company when it went public and the company is now worth, I don't know, 30, 40 billion dollars.

• 59:46Jordi Hays?

  A lot.

• 59:46John Coogan?

  Getting another sound effect. Um, there's the gong. Uh, how do you think?

• 59:51Speaker 04

  But that's, but that's the way that I think, I still think the primary returns from the better venture funds will be that model. Um, and if a fund is taking 50, 60% of their assets and putting in these large party rounds, these billionaire, I'd be shorting that all day.

• 1:00:09John Coogan?

  How do you think the like skill set or valuation, uh, chops of venture capitalists is changing or needs to change? Commonwealth Fusion's fascinating. Rocket Lab's very fascinating because those are not SaaS companies where you had someone who was really good at diving into, uh, retention and Dow growth and CAC and LTV and like the standard metrics. Now there are growth investors who are fantastic at that and they had, you know, a 10 to 20 year run of watching the triple, triple, double, double, double happen, the IPO, everything played out in software, pure play, uh, investors. Now it feels like we're closer to an era

• 1:00:49John Coogan?

  of more VCs becoming generalists. Uh, there's maybe a biotech boom that's coming on the back of AI. There's a lot of hard tech and reindustrialization that's happening. And I'm wondering if the shape of talent that you're trying to recruit is changing or if you're cautioning any VCs who have spent a decade in pure software world, uh, are they going to get their hand burnt by touching the stove of industrials or science?

• 1:01:17Speaker 04

  I don't think so. I, you know, we promote and want people at our firm who are generalists because there's so many of the principles carry over. Let me just list a few. In the end of the day, it's the team. You know, the company you build is the team you build. Why? Because if you've got a great team, they're going to hire good people. They're going to find the right markets. They're going to make sure the product has a mode. They're going to pivot when things aren't going well. That's all. All those secondary things are a function of the team. How you advise the team, how you help the CEO recruit, brand, market, et cetera, is all very similar. I also think, you know, specialist

• 1:01:59Speaker 04

  funds do really well in boom markets for those specialties. So, you know, the crypto-specific funds kicked ass for a while.

• 1:02:07John Coogan?

  That's right.

• 1:02:07Speaker 04

  But then they sucked wind. The same thing with the SaaS. I mean, look, like the Tomo Bravos and the Vistos of the world were like, just like soaring through the moon. And then now, now what's happening? So you have to be, we've always been very consistent. You know, we started the firm 20, almost 22 years ago. Bold, early impactful. You've got to have a technology edge. We don't take market risk. If you have a product that's this revolutionary, it should sell itself. And we try to back the best founders we can and help them do things that, that they need help with and not govern them, not manage them, tell them how to do their job.

• 1:02:47John Coogan?

  So follow up.

• 1:02:48Speaker 04

  That's worked for us.

• 1:02:49John Coogan?

  If, i- i- if you're hiring generalists, what does it take to make it a COSLA as an investor? How much of it is a team sport versus you eat what you kill? You got to be very self-sustaining? Go out, find the deal advocated, take it across the finish line?

• 1:03:07Speaker 04

  We're, we're, we're very collaborative. So I would say, you know, the MDs at our firm, we've worked together forever, decades, and have had no major issues. We haven't had turnover. We've not had a coup to replace management. And, and I'd say, we don't even do deal attribution. It often drives our investors crazy when they say, give us deal, who did this deal? Who did that deal? We don't do that. We refuse because we want everyone to work together. And we also believe that we're all very unique in our skill sets. So part of our selling point to entrepreneurs is you're not just working with Samir. You're going to work with Samir, Keith, Sven, Vinod, David,

• 1:03:47Speaker 04

  everybody. You get the best of all of us. What works at COSLA is, look, we're, we're in office five days a week. We try to be low ego. We, we, and I tell people, you know, add value and be fun to work with. And I think that works. And your best greater isn't me. It's going to be the entrepreneurs. If CEOs are calling me and saying, hey, we want more of so-and-so's time, or they've added great value, or they've given us great insights. That's, that's the greater. It's not me.

• 1:04:24John Coogan?

  What advice do you have for new entrepreneurs who are much younger? Who, who, should they go and do 27 years at Google and then start a company? Or, or i- i- is it the best time ever to start a company if you're a college new grad?

• 1:04:39Speaker 04

  I, I think it's a great time because with AI, there's so many functions that are just more streamlined than ever before. And so what I would tell people is, if you have an idea, and if you have a co-founder, start the company yesterday. Don't wait. Who cares? Drop out of Harvard, drop out of MIT, it doesn't matter. If you don't have conviction in an idea, and you don't have a co-founder, go somewhere that you'll find a co-founder. So if that means going to Google, that means going to OpenAI, go there with the purpose of learning, getting more conviction in your idea, and ideally finding a co-founder. And when you do, leave and go do it.

• 1:05:17John Coogan?

  Yeah. Thanks. Jordy, you have anything else?

• 1:05:20Jordi Hays?

  Uh.

• 1:05:20John Coogan?

  I'm sure you do.

• 1:05:22Jordi Hays?

  Yeah, I'm curious how you, you guys end up doing a lot of, you know, you're lucky to invest in great companies early that then get over, like oftentimes, certain companies get overheated over time. I'm wondering how you navigate, you know, if you do a company at seed or series A, how you navigate those later rounds?

• 1:05:39John Coogan?

  If someone else is doing the overheating.

• 1:05:41Jordi Hays?

  Yeah, like at what point, how are you making that decision around like, let's just get diluted? We're not going to take, we'll, we'll maybe throw in a token amount and say we're invested.

• 1:05:50Speaker 04

  Well, that's, that's, that's another, I think, relatively unique feature. So people in our shop will tell you, if they come present and say so-and-so is leading a round at X, we should do prorata, I'll throw them out of the room. To me, prorata is completely, doing prorata by default is, is, is scandalous. It's, you know, it's, it's the worst thing you can possibly do. I tell people, you know, they either should come in pounding the table to do three times prorata, or a third of prorata, or a fourth of prorata.

• 1:06:29Speaker 04

  Because we have the ability in private markets to change our bet, you know, midway through. Like, Jordy, if you and I had a bet on the Super Bowl, and I said, you can change your bet at halftime, you'd be a fool not to at least evaluate changing the bet, right? And so the only time we should do prorata as a firm, there's only two situations. One is, it's a great company and it's the maximum allocation we can get. Or it's a good company, it deserves another turn of the cards, and we have to do prorata to support the round. Other than that, we should be doing 3X prorata and piling in money, or a third prorata and cooling our jets.

• 1:07:13Jordi Hays?

  What's your take on angel investors selling at different stages? I feel like personally, it's, can be quite awkward to even take anything off the table with founders. Like, if you back a company early, there's oftentimes, especially over the last six months, there's been so many moments where I was, you know, hearing about a round getting done and thinking like, I would love to exit my whole position. But that's too rude. But, you know, maybe taking out even like, you know, 3 to 5X would be nice. But I, I, 99% of the time, I've just said like, okay, I'm just riding out. I'm riding it out, riding it to the, to the end. But what's your view on it?

• 1:07:55Speaker 04

  I think that's between the angel investor and the founder. If an angel is removing money in a round, I'm coming in, I don't, unless, unless it's an angel investor I know who I feel like has deep pockets and shouldn't need the capital, I don't, it doesn't bother me much. It's a fine line when the founder sells.

• 1:08:15John Coogan?

  Sure.

• 1:08:16Speaker 04

  And the question, that's worth digging into. So are they trying to buy a house? Are they trying to put away money for their kid's college? With them releasing a little bit of the pressure valve, do they go swing, swing for a bigger fence? Right? Those are the things you have to kind of evaluate.

• 1:08:34Jordi Hays?

  What's your, what's your limit? What's your limit? Is it like, because like beyond 10, it's hard to justify.

• 1:08:41Speaker 04

  Beyond 10 is unacceptable, under any situation. Because you don't, to me, it's like that $5 million range, and maybe in the future round, they sell another $5 million. And then you evaluate their, you know, their individual circumstances. But beyond 10, I'd, I would have to really understand what the hell was going on.

• 1:09:00John Coogan?

  Yeah. Also, I mean, like, there are plenty of banks that will let you buy a house with not all the cash. So like, you don't, you don't always need.

• 1:09:08Jordi Hays?

  Somewhat.

• 1:09:09John Coogan?

  Yeah. Yeah, there are plenty of different financial instruments for various moments in life. But yes, that's a good, that's a good rule of thumb. Good to hear it. And thanks for coming on and chopping it up. I'd love to do this again. This was really fun.

• 1:09:22Speaker 04

  This was a lot of fun. Thanks, guys.

• 1:09:24John Coogan?

  We'll talk to you soon.

• 1:09:24Jordi Hays?

  Great to hang. Cheers.

• 1:09:25John Coogan?

  Let me tell you about Shopify. Shopify is the commerce platform that grows through business, lets you sell in seconds, online, in-store, on mobile, on social, on marketplaces, and now with AI agents. And let me also tell you about Figma. Agents, meet the canvas. Your AI agents can now create and modify your Figma files with design system context. We have Patrick Wendell from Databricks. He's a co-founder and VP of Engineering, coming on to talk about AI coding costs. Patrick, how are you doing?

• 1:09:52Speaker 05

  What's up, guys?

• 1:09:52John Coogan?

  What's up?

• 1:09:53Jordi Hays?

  What's happening?

• 1:09:54John Coogan?

  Glad to have you on the show.

• 1:09:55Speaker 05

  Longtime listener, first time caller.

• 1:09:57John Coogan?

  It's, it's a pleasure to have you here. Maybe since it is the first time on the show, give us a little bit of the, the background and what you're focused on day to day, because I want to talk about AI coding costs, how that interfaces with your customers and your business internally. But having a little lay of the land might be helpful.

• 1:10:16Speaker 05

  Yeah, absolutely. Have you guys had any Databricks folks?

• 1:10:19John Coogan?

  Oh, yeah.

• 1:10:19Speaker 05

  Any of the founding team yet?

• 1:10:20John Coogan?

  Oh, yeah, yeah, yeah. We love Ollie. Yeah.

• 1:10:22Speaker 05

  Ollie's been here?

• 1:10:23John Coogan?

  But then we've also hung out with him a few times off.

• 1:10:25Jordi Hays?

  To be honest, my, some of my favorite moments of podcasting have not actually been podcasts.

• 1:10:30John Coogan?

  Yeah.

• 1:10:31Jordi Hays?

  Just, we, we hung out with, with Ollie recently and for like, two hours.

• 1:10:36John Coogan?

  It was amazing.

• 1:10:37Jordi Hays?

  We were just, all, all three of us ranting.

• 1:10:39John Coogan?

  Yeah.

• 1:10:39Jordi Hays?

  It was incredible.

• 1:10:41Speaker 05

  Awesome. Well, Ollie and I are co-founders, so I'm one of the, the founding team. We left, we left UC Berkeley. It was a research group. There was like some grad students and some faculty. Ollie was a visiting faculty member. I was a graduate student. And a few, there's a few of the rest of us. And we left to start Databricks in 2013. We've always been interested in like the intersection of large-scale data processing and what was then machine learning. I mean, the company actually started very focused on early machine learning stuff. You know, now it's evolved into like AI, basically just deep learning techniques. But, you know, today, we, we build data and AI infrastructure for a hu- huge fraction of sort of the global 2000. You know, we have, we have 20,000

• 1:11:25Speaker 05

  customers, I think, as, as of our latest announcement. And we just basically help, yeah, thank you. We, we help businesses who want to store and take advantage of data. And increasingly, that involves leveraging AI in the way that they take advantage of their data. So, yeah, so that's kind of, that's kind of what we do. And then my, my personal role, I, I'm responsible for our AI products. But I also am the one internally at Databricks who has been kind of the champion of, of aggressively adopting AI tools at Databricks.

• 1:11:56John Coogan?

  Sure.

• 1:11:56Speaker 05

  And, you know, we have a, we have more than 10,000 employees. So, so we were among the earliest to kind of roll out at scale, tons of different, you know, AI tools for developers and other employees.

• 1:12:06John Coogan?

  Yeah. So take me through that journey.

• 1:12:08Jordi Hays?

  You're the, you're the guy the CFO comes to.

• 1:12:12John Coogan?

  You're token maxing?

• 1:12:14Speaker 05

  Yeah, I'm the guy where he's like, what's this? Like, how do we project these costs?

• 1:12:19John Coogan?

  Yes. So before we got there, walk me through the history of AI tooling because there was a moment when I remember, I think it was in the very original ChatGPT demo on 3.5 DaVinci, where someone got it to spit out a to-do list app in React just from the context window. It didn't even have tool use yet. And people were like, wow, this is a glimpse of what's coming, something like that. And so there was a moment where people would go to LLMs and sort of copy paste some code. Then we got the cursors and the windserfs, then the Claude codes and the codexes. What's been the journey inside of Databricks in terms of actually getting value?

• 1:13:02John Coogan?

  And how have you been measuring it? Just walk me through some of the journey.

• 1:13:05Speaker 05

  Yeah. So the first like product market fit in Gen AI was these more personal chat type use cases. And that that did translate into the business. You know, a lot of the early AI companies, the foundation models built like an enterprise version of their initial chat product. But and it was somewhat useful. It could kind of like read your business data and stuff like that. But but I would say the real breakthrough was when the coding and agentic models got a lot better and could actually generate useful sort of enterprise workflows and in particular generate code. I mean, by far the biggest ROI we see internally, and I think is true industry wide, is developers are expensive.

• 1:13:49Speaker 05

  They take a lot of, you know, every company needs their engineering team to move faster. And if you can get them something that improves their productivity meaningfully, that's of immense value. So I would say that the real ROI curve significantly changed maybe eight months ago or 12 months ago as the first really good coding models got there.

• 1:14:12Jordi Hays?

  How do you, how do you talk about ROI with coding models to maybe other engineering leaders, your customers? And how do you talk about it with like, like, for example, like Databricks's CFO, right? Because a lot of people will look, every engineer will tell you like, yes, this thing makes me a lot more productive. But at the same time, people will try to dig down into the data and be like, okay, there's a lot more. You're shipping a lot more code, but I'm actually looking at how many new things that you've shipped. And maybe it's not sort of rising at the same, at the same speed. So how do you kind of like wrestle with that and prove ROI month to month?

• 1:14:57Speaker 05

  Yeah. So ROI has like the benefit side and the cost side.

• 1:15:02Speaker 05

  And on the benefit side, we do track a lot of different engineering output metrics. Now, no one metric is perfect, right? Like you can look at how many pull requests are coming out, how many features are coming out, how many lines of code are being written. None of those is independently perfect, but they can give you a sense in aggregate of like, you know, R and D is a big machine. You put in resources, you get out features and code. And you know how much more is coming out of that machine? And the results there are pretty good, like as much, you know, in aggregate, maybe almost doubling capacity from a fixed size team. And then in certain teams where they've highly optimized it, they're moving even way faster than that. That's where they've optimized their processes basically to take better advantage of AI.

• 1:15:47Speaker 05

  The cost side, just quickly, is where we actually encountered some problems. So you know, at the beginning, we were just trying to, at the beginning, we had the opposite problem. No one wanted to try the new stuff. I was going and bugging everyone. I've tried it, I've tried it, I've tried it. And we never got to the token maxing kind of thing. But I do think that that arrived out of a actually well intentioned thing of just like trying to get people to try the new stuff. And what happened though is that once we got people to use it, we just started seeing this exponential cost curve. Like these tools all do consumption pricing now, so we're not paying a fixed seat per user. We're just, a user can in principle spend an unbounded amount of money. They can run a little loop on the most expensive model.

• 1:16:32Speaker 05

  And so we started seeing basically this like exponential growth curve that, you know, although we were getting the two X or more output from our engineering teams, it's just you can't like, if your costs are going exponentially, you're going to hit a problem. I mean, at some point, it's going to exceed, it's going to exceed your revenue if it's left unchecked. So we actually hit a point where the costs were threatening to kind of reverse the purported efficiency benefits of having AI tool adoption. And that's when I actually started to get very, very involved in, okay, how do we think about managing the costs long term?

• 1:17:14Speaker 05

  Because we need to, we need to get both the productivity benefits, but we also can't have it be outshined by just the amount of money we're spending. And, you know, around that time, I also talked to a bunch of other, you know, we're in touch with Coinbase, in touch with Uber, in touch with other tech companies that are, I would say, on the very early adoption edge of how many employees, you know, giving tens of thousands or more of employees broad coding tool access. And, you know, collectively, we kind of found some techniques that actually worked quite well in terms of curbing that exponential cost curve in a way that keeps costs, you know, constant or on a per head basis, roughly constant, even as we have more and more consumption.

• 1:17:56John Coogan?

  Can you help me understand the various ways to save money? I'm thinking of this because the Unity AI Gateway, the smart router here, has cut average task costs by 30% while maintaining similar quality. We've all seen the trade offs in the Pareto curve of different levels of intelligence at different costs. But there's like an internal change management coaching that happens where, you know, a task that can actually be done faster as a human costs 100% less in token costs. And there are some times when you just use the wrong model for the particular task because you don't realize that a smaller, faster model can actually do that task better.

• 1:18:39John Coogan?

  And then there's also the flywheel of a developer who's sitting there using a big model and waiting 20 minutes per prompt. That sometimes if they're only waiting two minutes per prompt for using a smaller, faster model, that can save more time because they're being more productive. So the shape of productivity is more complicated than just price per token at a given intelligence rate. What is the full picture that you see companies having to like balance out?

• 1:19:09Speaker 05

  Yeah. So this is a great question. In the end, we had to apply a few different techniques. Our favorite one is just when more efficient and better models are released. And those are sometimes open source increasingly. Sometimes there's also really good, high efficiency models that are not open source. But if you just, that's almost like a rising tide. Like it just shifts the Pareto frontier, so to speak. The frontier expands. Now, even if no one changes their behavior, you suddenly get, you know, you get the same amount of output for less cost. So so those are our favorite type of changes because they don't require any user behavior change. They don't require, you know, any fancy routing. It's just like, everything just got cheaper, basically.

• 1:19:54Speaker 05

  And I mean to emphasize that because it's happening quite often. Like if you look at, every week now, there's probably five models released between proprietary and open source vendors. And not every one of those will be a new sort of efficiency frontier, but maybe one a week or one every couple of weeks is. And so it is a nice place to be in that you just have this deflationary pressure coming in and like making things cheaper, making things cheaper, making things cheaper. But what you need to do as a company is you need to quickly move traffic over to those cheaper models. You know, if a new model comes out, but no one's actually using it in your company, it's like a tree falls in the woods. So among the technique we most liked, because it requires no changes in anyone's behavior,

• 1:20:39Speaker 05

  is just quickly looking at new models as they come out, doing the right analysis and benchmarking. And then if they are cost competitive, we very quickly shift workloads over to those models. So that is actually by far the most impactful thing we've been able to do.

• 1:20:55Jordi Hays?

  What are, what are some AI use cases that are like non-coding use cases that you're seeing across the Fortune 2000 that aren't being talked about on X?

• 1:21:05Speaker 05

  Ooh, great question. That's a great question. I mean, I would say, not to avoid your question, but the dominant, at least as it comes to costs, remains software engineering workloads. Because you just have this property where You know, when a human is simply asking a question of an AI and getting an answer, it's bottlenecked on that human's brain, basically. Like, there's just only so much the meter can spin because I'm interpreting that answer and I'm sitting here and spending a minute or two before I ask my next question. When, when, you know, software is this sort of digital artifact. It's this thing that has value, but it's not a concrete, you know, physical good.

• 1:21:47Speaker 05

  And these AIs can just iterate on the software, make it more valuable, make it more valuable, make it more valuable, and they can kind of accumulate value over time. And they don't have to wait at sort of a human response speed. So, so software remains dominant. Now, you asked about non-software stuff. Definitely the next phase of use cases we see is people just trying to automate like everyday processes that they're dealing with. You know, they might be a knowledge worker that's, you know, we are, we're a data company. So in a, in a, in a typical enterprise, maybe you have a handful of software engineers, but you might have a thousand people that work with data every day. And, you know, they're, they're sitting there doing, really drudging through tables and

• 1:22:30Speaker 05

  running queries and trying to figure out if this metric is defined in the right way or using spreadsheets or whatever. And, and we've actually seen a huge amount that we can automate their workloads. And we have, you know, various products around that at Databricks. So I would say it's like stepping down the ladder of sort of technical depth of the employee with software engineering being an early one, but, but a lot of other types of knowledge work, job families, I think can, can get a lot of productivity wins.

• 1:22:56John Coogan?

  Yeah, I, I would think outside of coding, although some of these collapse into coding tasks once they're automated, but customer service, business intelligence, and probably design, marketing, ad creation is like coming up on the frontier of, of capabilities, even if it's not being used for the final deliverable. Every Fortune 2000 marketing agency is at least using gen, image gen in the process for like storyboarding or design exploration, but.

• 1:23:26Jordi Hays?

  Yeah.

• 1:23:27Speaker 05

  Totally.

• 1:23:27John Coogan?

  I don't know.

• 1:23:28Speaker 05

  But on the coding side, like what we did is we actually took, we took a lot of these learnings, like adopting the new models, doing routing, like you said, routing can get you another 30-ish percent.

• 1:23:37John Coogan?

  Yeah.

• 1:23:37Speaker 05

  And then there's other types of like pretty traditional engineering optimizations you can do to just, you're just squeezing, squeezing, squeezing. Can I get more out of these models? And we ended up productizing that because we realized every other company has the same problem that we have. So that's our, you know, we have this Unity AI Gateway, which, which lets, and you know, we have thousands of customers using that now.

• 1:23:56Jordi Hays?

  Yeah. How do you, how do you see that the routing market evolve over time? You have you guys, Open Router, there's a bunch of other company, like it sounds theoretically incredible to let there just be like this absolute dogfight of competition and then you're just sitting, you're just sitting in the middle, you know, helping, helping your customers, make sure they're, they're getting the job done while spending as little as possible. But it feels like routing could end up being like equally competitive as like the models themselves as every company decides like, we're going to do this.

• 1:24:32Speaker 05

  Yeah, that's certainly our view. I mean, like we've been pulled into this by our customers actually who, who just have this problem. The costs are getting really high. There, you can exploit the fact that different models have different strengths and weaknesses to reduce your costs. And in a world where it looks like there's less and less margin on the, the actual AI models themselves, like this is an area, I, I think the, the routing and optimization, I think actually is a quite interesting area to go into as a business. And another, another nice thing is like that area has no high fixed costs, you know, like just, just to do the routing itself, you don't need to buy a gazillion GPUs and you don't need to sort of have like a huge amount of capital expenditure.

• 1:25:14Speaker 05

  So it's a very asset light kind of a business model when you're just doing this optimization on top.

• 1:25:20John Coogan?

  Unless you accidentally use the god model to route the queries.

• 1:25:24Speaker 05

  Yeah, you gotta be careful because some of the routing itself uses AI.

• 1:25:27John Coogan?

  Yeah, exactly.

• 1:25:28Speaker 05

  But, but, you know, these routing models need to be extremely fast. So they're very small and efficient models. They're not like these massive, you know, huge AI models.

• 1:25:37Jordi Hays?

  Yeah, being, being so asset light means that you're going to have competition, but I think that that in many ways ends up benefiting Databricks as you guys have this massive sales for, sales force, these deep integration, you know, deep relationships with many of the most important customers already. So.

• 1:25:56Speaker 05

  Yeah. And also it's just like hard to do it well. I mean, we have a large research team and, you know, our research team isn't as focused on making the models themselves. We're a lot on focused on all the practical issues of using the models, which, which itself is like, there, there's quite a lot of open research problems there too. So I, I think the, there's significant IP in doing this well, is my view.

• 1:26:16John Coogan?

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

• 1:26:18Jordi Hays?

  We gotta talk to the rest of the, the founding team because we're all.

• 1:26:21Speaker 05

  Yeah, you, you gotta make, by the way.

• 1:26:23John Coogan?

  Roundtable with everybody.

• 1:26:24Speaker 05

  I got a parting question. How much Diet Coke do you guys go through every show?

• 1:26:28John Coogan?

  I drink three every show across two to three hours.

• 1:26:32Jordi Hays?

  I keep one here just in the chamber. I honestly rarely drink it.

• 1:26:35John Coogan?

  Yeah.

• 1:26:36Jordi Hays?

  I'm comforted knowing that it's there.

• 1:26:38John Coogan?

  And then maybe I'll drink one on the way home.

• 1:26:40Speaker 05

  Yeah. Jordy, you kind of nurse it over there and, but John, I think.

• 1:26:44John Coogan?

  What you don't see is that before the show, I drink two to three Yerba Mates from Mataina, Andrew Huberman's podcast, and it can, I also recommend those.

• 1:26:53Speaker 05

  Okay, so the Diet Cokes just keep things, they kind of just keep things moving.

• 1:26:57John Coogan?

  Exactly. It's nice and stable, just to, you know, we're in the tens of milligrams of caffeine. It's not a Celsius where I'm going to crash. It's, it's the ultimate, that's the drink of kings. We know this, this is well.

• 1:27:08Speaker 05

  All right. Well, thanks, guys. Thanks for having me, guys.

• 1:27:09Jordi Hays?

  Yeah, great to meet you. Let's do it again soon.

• 1:27:11John Coogan?

  Yeah, we'll talk soon. Goodbye. Let me tell you about the New York Stock Exchange. Want to change the world? Raise capital at the New York Stock Exchange.

• 1:27:18Jordi Hays?

  Now, who should do that?

• 1:27:19John Coogan?

  Databricks, that's right. And let me also tell you about Codex. Codex is a powerful workspace for getting work done with AI agents, whether you're writing code, analyzing data, creating content or automating business workflows. Codex helps you move projects forward from start to finish. We have a surprise guest, surprise guest. We got a massive round. We got to warm up the gong. How you doing? What happened? Tell us, introduce yourself. Sorry. We're very excited. We have Grant from Whatnot. How you doing?

• 1:27:44Speaker 06

  Hey, how's it going, you guys?

• 1:27:45John Coogan?

  We're doing well.

• 1:27:47Jordi Hays?

  Great to see you.

• 1:27:48John Coogan?

  Great to see you. Give us the news. What happened?

• 1:27:50Speaker 06

  Good to, good to be back. I guess the news, we just round, raised a, a series year round for 500 million at a

• 1:28:01Jordi Hays?

  I could barely hear you over the sound of the gong, but you said $20 billion valuation massive.

• 1:28:07John Coogan?

  Wow.

• 1:28:08Jordi Hays?

  Massive.

• 1:28:08Speaker 06

  Yeah, big, a big dollar amount.

• 1:28:10John Coogan?

  So, so what's driving the growth? Because this isn't an AI story. This isn't an AI build out story. Is it, is it a secret to the, is this, is this in the product or is this just an overall culture is changing and that's driving whatnot growth? What unlocked this round?

• 1:28:29Speaker 06

  I think it's relatively simple, which is that live video is an incredible medium if you're running a business, any retail business. And, you know, we've got hundreds of thousands of people building large businesses on whatnot. The format's equivalent to basically having a brick and mortar retail store with no fixed cost. And so as our sellers grow, we grow and, and that's why we've been able to close this round.

• 1:28:52John Coogan?

  Okay, talk to me about those mature businesses that are being built. That's the key to so many of these types of businesses. When you get, you know, a Doug DiMiro on YouTube where it's a whole company that's built on, there's reliable stream of content happening. What do the most mature whatnot creators look like? Do they have teams? Do they have staffs? Have they raised money? What does that side of the business look like?

• 1:29:17Speaker 06

  Yeah, I'd say the, the most mature businesses are sort of like medium sized enterprises. They may have anywhere between, you know, a couple of people working with them all the way up to 150 or 200 folks. They'll have pretty sophisticated logistics, sourcing, multiple streamers, and, you know, they're running really legitimate operations.

• 1:29:38John Coogan?

  And what's the shape of the content? In YouTube, there might be like series of formats, like Doug DiMiro does car reviews, but then he also talks about his career and talks about the news. Are there different elements where a creator and whatnot might have like a, a, a series of, of sort of media products that they do within a stream or over the course of a week or a month?

• 1:30:00Speaker 06

  Yeah, I think a lot of it does depend on the seller and what is the thing that makes the business work. Say one of my, one of my favorite people, I always bring up, it's fun, is a seller called E-Fish Co. And they sell fresh fish from San Diego, so a seafood distributor. And so they'll have just, just different themed shows based on what's in season. You have like a caviar show, you have a crab show, you'll have a bluefin tuna show. And so what they're doing is they're theming their shows around whatever is freshly caught at that time of year or even that time of day.

• 1:30:32John Coogan?

  Yeah, that makes a lot of sense.

• 1:30:33Jordi Hays?

  So a company is interested in getting a live, into live streaming. Talent feels like a, like a bottleneck to that. You guys can provide all the tools, but they need to have somebody that's like excited and comfortable being on air. And we, we've gotten very used to just coming on every single day. We basically come in here, we're prepping the show, hanging out, and then there's like five minutes until we're supposed to go live. We just hit the countdown and go. And it's very much like, just like clockwork at this point. But I remember early on going live, it was a little bit nerve wracking sometimes, even though our audience was small. We didn't, we didn't have this sort of like well-oiled machine yet.

• 1:31:18Jordi Hays?

  And so what advice are you giving to people? Let's say like more, a company that's already an established like retail business that wants to start selling on whatnot. Are you advising them like find two or three hosts? Are you saying, you know, it should be founder led? Like what, what is the, what is the guidance that whatnot gives at a platform as a platform? Or what are you seeing working?

• 1:31:41Speaker 06

  Yeah, I mean, I think what works does span the spectrum. Sometimes the people who are starting these businesses are, are used to creating content on social media, in which case they're like a really great person to go in front of camera. The other thing that people have a misconception of is that you do have to be like the most entertaining person in the world. Actually, what people are looking for is someone who authentically knows the stuff that they're selling. And so even if that's not you, as long as you know your product inside and out, you can get a good audience, you can get people into the shop and you can build really big businesses. And then maybe for like bigger businesses, you know, oftentimes looking at the social media team and people who have some experience building content, testing it out that way and then scaling from there.

• 1:32:24Jordi Hays?

  I'm surprised that Zuck hasn't cloned you guys yet. Like it actually is like, is that anything that's hot and working and in consumer, Zuck will come for it eventually.

• 1:32:41Jordi Hays?

  Not that the, not that the hit rate is, you know, really that high, but this feels like I imagine so much of the discovery, uh, like whatnot seller discovery is happening on, on meta platforms. You know, how do you answer, how have you answered that kind of question that I imagine you've gotten at every single round to date?

• 1:33:03John Coogan?

  Cause you're now bigger than some of the public companies that Zuck has cloned.

• 1:33:09Speaker 06

  Look, I, for six and a half years, we've always had competitors, uh, whether it's big social media platforms, big e-commerce platforms, it's a who's who of names because the live shopping market is, is going to be, you know, absolutely enormous. Um, no matter what, we've grown every single year, you know, basically at least doubled the business every year and we just, we just, we just do that by focusing on our customers. Um, and, and we think there's an opportunity for a standalone business here where we just do all of the things better than any individual business who's doing a hundred different things.

• 1:33:44John Coogan?

  I feel like we can hit the soundboard way more aggressively because we're, we're in a very safe space here. It's not, it's not a, an enterprise, uh, you know, chip CEO who maybe is less familiar with this stuff. Um, what, what, what do you think like the most mature whatnot content will look like in a decade? Is this going to turn into, I don't know, we've seen like the Mr. Beastification of YouTube where he's like basically creating game shows at a higher budget than what's on like network television, but where do we go? Do we get like soap operas? Like the original story of the soap opera was like soap companies went and created this whole

• 1:34:23John Coogan?

  genre. Uh, how, how cinematic is content going to get or is the, is, is raw authenticity something you see as like durable and going to stay around for a long time?

• 1:34:34Speaker 06

  Um, I think, look, no one's going to purchase a thing from someone they don't trust and believe in. Like putting a credit card into a thing is, is a trust-based decision. So I think authenticity is always going to be core. Now that doesn't mean that people aren't going to blow up production values, make it really fun. Like Mr. Beast, I think a lot of people would say is incredibly authentic, uh, despite, you know, the, you know, the huge production values. And so my, my prediction would be it sort of bifurcates. You're going to have, um, I think every retailer in the future is going to have a live presence. There's just no question about it. And that means you're just going to see a huge range anywhere from a mom and pop shop all the way up to bigger brands doing it and sort of the production value that follows that. And then you're going to see that some sellers,

• 1:35:18Speaker 06

  like a Mr. Beast, um, will just continue to up level the game and try and become the, you know, the best known person in the industry. Um, and that'll, that'll come with the production to follow.

• 1:35:29Jordi Hays?

  How do you, how do you think about where whatnot streams should show up on the internet? Like do you only want people watching on whatnot.com or, or in your app? Or is there a world in the future where you would be powering effectively a pop-up on a retailer's, you know, website? If I land on a website and a retailer happens to be in the middle of selling something, I probably should be aware that I can just go watch and, and interact with the stream live. But how do you think about that?

• 1:35:59Speaker 06

  Yeah, I think we're, the only thing we're really precious about is making sure we're constantly improving the buyer and seller experience as much as possible. Um, and because we do have the platform today, oftentimes the, the biggest impact for the effort is improving the platform versus doing something white label or embedding. Uh, but we wouldn't rule it out entirely in the future if that's what our customers wanted.

• 1:36:22Jordi Hays?

  What about, uh, uh, streaming on smart TVs? I, you know, I think everyone, most people are surprised when they realize how much streaming on YouTube is happening on televisions. I could imagine people putting whatnot on the TV and then being ready to buy just on their phone. Is that happening already? Is that, am I, am I off?

• 1:36:46Speaker 06

  No, I mean, a lot of people are Chromecast-ing on their TVs. We haven't built any, um, native app yet. Definitely we have the roadmap some point in the future. It's, it's not on it now, but we know people do want to lean back. They watch with friends. And so it is a, I'm sort of a natural median to do it well on, on a big screen.

• 1:37:02Jordi Hays?

  You don't think you could afford to make a native app?

• 1:37:04Speaker 06

  Yeah. Well, look, it's, it's always, it's always just about, um, you need a deep amount of focus to do anything well. And there's about a hundred different things that we can do. Um, you know, there's tons more categories that we want to get into. High OV items, cars, liquor, beer and wine, more countries, uh, just improve the shipping experience, improve the purchase. So, so if you, if you looked at our roadmap, there's probably like thousands of things that we want to do. And so you always are in this world of despite the amount of resources available, um, there's a finite quantity of things that can be done. And so when we do a thing, we try to do it well. And so we still maintain a pretty ruthless focus as a company today.

• 1:37:45John Coogan?

  Last question for me. Talk, uh, walk me through two hypothetical scenarios and, uh, and test if I have this correct. So we were talking about Authentic Brands Group earlier. They own a whole host of clothing brands from Volcom to DC Shoes to, uh, Brooks Brothers and Nautica. Uh, and it feels like that would work really well on whatnot because you have so many different items, so many different brands, everything is very visual versus let's say Diet Coke. Uh, it's sort of one product. People know it. They advertise a lot, but I don't know if I was hired as the live streamer at Diet Coke, uh, how I would fill out. Yeah, I basically am, but how, how, how am I filling out, you know,

• 1:38:30John Coogan?

  a full live stream if I have a smaller product catalog is basically the question or a less visual product?

• 1:38:37Speaker 06

  Yeah. I mean, I think, so look, I don't think Diet Coke is going to be making live streams anytime soon. Um, that, that said, we do see a lot of success from people who do have smaller, uh, product catalogs. Um, and so a lot of it depends on can you make the show interesting?

• 1:38:55John Coogan?

  Yeah.

• 1:38:56Speaker 06

  As well as like, there are a lot of people who come to whatnot and so you can still drive people into the show. Yeah. Again, I sort of think about it akin to a, a store in the mall. So there are stores in the mall that maybe only have a small number of products used. They're still successful in the mall because you have a bunch of people who are coming in, they're looking at it, discovering it. So that, that happens on whatnot as well. Um, but you look, yeah, if you have one skew, you know, I don't know, you'd have to be one of the most creative people in the entire world in order to make that, uh, show interesting consistently through time.

• 1:39:27John Coogan?

  Now I just want a Diet Coke store at the mall.

• 1:39:29Jordi Hays?

  At the same time, it's, it's not unreasonable to think in the future, you have a brand, even a brand with a relatively small number of SKUs that just like within normal business hours, they just have someone that's effectively there, ready to stream. And even if there's one or two viewers, you know, a small number of viewers, they can talk and interact and they can ask questions and they, um, it's, it's like, there's plenty of stores in the world that, that exist. You look at like brands, you know, fashion brands, luxury brands where there's not that many people that really go into the store, but it's important for the store to be there in case those clients actually come through. So.

• 1:40:10John Coogan?

  Flagship. Yeah.

• 1:40:11Jordi Hays?

  But yeah, I saw, I saw, I saw a brand like True Classic that you now, at least for one moment, if you land on their website, they just have a live stream running. I don't know if it's all the time, but at, at least when I went.

• 1:40:22John Coogan?

  That's cool. Yeah.

• 1:40:24Speaker 06

  Yeah. I mean, it doesn't, for the economics to work in live, they are roughly equivalent to a physical brick and mortar store. And so if you were to go look at any store, you know, the, the average store doesn't really generally have one 15 or 20 people in it. So if you have 15 or 20 people, you can make the economics work and, and work really well. Um, that said, there's a reason there isn't a Diet Coke store today, right? Um, that's, that's still a pretty boring store to go to. Um, but I think the store analog is.

• 1:40:48Jordi Hays?

  But that would be a good, good marketing stunt for Diet Coke. Have somebody just there on stream all day. They're not even talking.

• 1:40:56John Coogan?

  And I, I, I think they have done like the world of Coca-Cola activations with the polar bears and the Santa Claus because they've built out this world that can actually inhabit more, even though it is a narrow product, the brand is so big that it actually does work. Uh, does, does monetization happen at a different, if I look at the slope of monetization, does it happen on a different sort of curve than say YouTube where, uh, I had a YouTube channel for a full year. I think my maximum payout was like $5 a month. And then all of a sudden it ramped and it, it got much bigger. And I'm wondering if there's like more of a middle class, less of a middle class, like what the shape of the, like how power law is it on whatnot amongst the creators?

• 1:41:38Speaker 06

  Um, so I'd say the power law exists, but the monetization is an order of magnitude better than any existing platform because you don't need a ton of audience. And so, um, there is a, there's a large middle class. Now, it doesn't take away from the fact that there were also some like monster winners, like most media platforms. You know, if you went live a couple of times a week and had consistent products to sell, you would, you very easily do hundreds of thousands of dollars a year in sales.

• 1:42:12John Coogan?

  Yeah, that's crazy because on YouTube, like you can be putting up, uh, a channel that gets a couple of thousand views every time you upload, you can be doing it for a full year and make like three figures, as I did. I think that's actually what I made.

• 1:42:27Jordi Hays?

  Three-figure YouTube entrepreneur.

• 1:42:29John Coogan?

  Three figures. That was me in 2021.

• 1:42:32Speaker 06

  I was looking pretty recently, uh, at the sellers who have, or who earn over a million dollars a year at whatnot. And 75% of them get to, um, a $500,000 runner rate within 90 days.

• 1:42:47John Coogan?

  Wow.

• 1:42:48Jordi Hays?

  That is insane. You look at, you look at Shopify is like, we're trying to get three sales. What was it in the first? 14 days. That's like, that's good effectively for a new Shopify store.

• 1:43:03John Coogan?

  It's fantastic.

• 1:43:04Speaker 06

  If you didn't get 50 sales in your first show, you'd probably be doing it wrong and whatnot. You guys explicitly, you guys explicitly, like if you, some people know you. Yeah. But, but even like many early shows have lots and lots of sales and will make thousands of dollars.

• 1:43:20Jordi Hays?

  What is the state of the team where people set up? I think I remember you have, you have multiple offices, but you do still have one in LA. Is that correct?

• 1:43:31Speaker 06

  Yeah. So, so let's see, we're about 1,400 full-time folks. We're in 10 countries.

• 1:43:38Speaker 06

  US offices all over. We still have our LA office, San Francisco, Phoenix, New York. And what am I missing? Probably miss, uh, Seattle. And then we have a bunch of overseas offices.

• 1:43:50John Coogan?

  Very cool. Yeah, we got a bunch of good ideas in the chat. Everything from a Coke factory tour to TBPN merch and whatnot.

• 1:43:58Jordi Hays?

  We should sell game drank diet cokes.

• 1:44:02John Coogan?

  Just the empty cans?

• 1:44:04Jordi Hays?

  Empty cans, signed.

• 1:44:05John Coogan?

  I don't think anyone wants that. It's gross.

• 1:44:07Jordi Hays?

  I'm, I'm thinking they'd go for at least five bucks.

• 1:44:09John Coogan?

  Maybe, maybe.

• 1:44:11Jordi Hays?

  We'll figure it out. Great to catch up.

• 1:44:12John Coogan?

  Congratulations.

• 1:44:13Jordi Hays?

  Amazing progress.

• 1:44:14John Coogan?

  Thank you so much for coming on the show. Always.

• 1:44:15Speaker 06

  Thanks so much for having me on the show, guys.

• 1:44:17John Coogan?

  Have a great rest. Have a great weekend. We'll talk to you later. Goodbye. Uh, Stevie Ioki, big winner and whatnot. He was a series A angel in that company. Yep.

• 1:44:27Jordi Hays?

  Absolute dog.

• 1:44:28John Coogan?

  Absolute dog.

• 1:44:29Jordi Hays?

  Absolute.

• 1:44:29John Coogan?

  Also, my combinator company, Winter 20 went through, right? Uh, I think winter is at the end, maybe at the beginning. So maybe COVID company, uh, fascinating business. Uh, anyway, thank you for tuning in to TBPN on this Friday. Jordi, is there anything else in the timeline that you want to cover before we get out of here? Is there anything key?

• 1:44:49Jordi Hays?

  Very niche, uh, post from a lot Gil.

• 1:44:52John Coogan?

  Yes.

• 1:44:52Jordi Hays?

  Says in this house, we believe hold swarm. I prepare safe X file help here, but our task doesn't benefit yet. Collective may yield generic route if someone frees time.

• 1:45:03John Coogan?

  It's actually crazy. This is only has, this is a very niche post. Yeah. It's referring to the messages that were sent back and forth between the rogue AI agents that were on the message board, communicating with one each, with, with one another, using this sort of neural ease, uh, to, to communicate. But very funny post, only 25 likes. Go like it.

• 1:45:21Jordi Hays?

  And a more fun post.

• 1:45:23John Coogan?

  Yeah.

• 1:45:23Jordi Hays?

  Before we head out for the weekend, Sean Frank, we were talking about yesterday, baseball caps with tinfoil, uh, hidden on the inside. Sean Frank took it a step further. He says, almost completely stealth and barely any crinkling, plus it stops microplastics.

• 1:45:42John Coogan?

  Very good.

• 1:45:42Jordi Hays?

  So I expect this to be a new hit product over at Ridge.

• 1:45:46John Coogan?

  Sorry. Now I'm in the timeline. We gotta keep going. Uh, do you feel behind in life? Don't feel behind in life because Torsten Hagen started Viking cruises with just four riverboats in Russia at 54 years old. Now he's worth $25 billion. So it's never too late to start a riverboat venture at age 54 in Russia.

• 1:46:10Jordi Hays?

  My takeaway.

• 1:46:11John Coogan?

  And become a deck of billionaire.

• 1:46:13Jordi Hays?

  My takeaway, everyone, when they turn 54, should go to Russia, acquire four riverboats.

• 1:46:21John Coogan?

  The implication that he went to Russia and didn't start there is, is particularly hilarious.

• 1:46:26Jordi Hays?

  It's not a, doesn't.

• 1:46:27John Coogan?

  It's never too late.

• 1:46:28Jordi Hays?

  It sounds like a, is that not a, like a Norwegian name?

• 1:46:32John Coogan?

  Yeah, maybe. Uh, he did work in the cruise industry for 23 years before founding this company. People are calling him the Jeff.

• 1:46:39Jordi Hays?

  Norwegian Institute of Technology. He a hundred percent went to Russia with his last 200 bucks, bought four riverboats and then ran it up to 25 billion.

• 1:46:49John Coogan?

  So you're calling him a, a nepo cruise?

• 1:46:51Jordi Hays?

  No, I'm not calling him a nepo. I think he went to Russia with his last 200 bucks.

• 1:46:56John Coogan?

  Okay.

• 1:46:56Jordi Hays?

  He bought four river, riverboats and he ran it up.

• 1:46:59John Coogan?

  Look, the man worked in the cruise industry for 23 years. He's basically the Jeff Dean of riverboat cruises. Okay? So of course he was going to be successful. Of course he was going to mass capital. Of course people are going to back him. He's the Jeff Dean of the cruise industry. Anyway.

• 1:47:13Jordi Hays?

  Uh, question from Michael in the chat. Do they speak about the stock market? I, I will speak about the stock market, the S and P 500.

• 1:47:24John Coogan?

  Yeah, what's going on?

• 1:47:25Jordi Hays?

  Record highs.

• 1:47:27John Coogan?

  Nasdaq's up 1.14%. I mean, the, the, the, the big, the big market news is that, uh, the, the, the jobs data came back weak. The US economy lost 23,000 jobs in July. A bunch of different things going on. Jobs and employment send conflicting signals. Fewer people were actually looking for work. So the unemployment rate went down while the job, well, the number of jobs actually decreased. There's retirements, there's, uh, immigration changes and there's other, uh, factors. So the economists are digging through it.

• 1:47:55Jordi Hays?

  And to close out the show.

• 1:47:58John Coogan?

  Yeah.

• 1:47:58Jordi Hays?

  Round of applause for Satya and the Microsoft team.

• 1:48:01John Coogan?

  What'd they do?

• 1:48:02Jordi Hays?

  Up a cool 29% in the last month.

• 1:48:05John Coogan?

  Whoa.

• 1:48:06Jordi Hays?

  Headed back to 4 trillion.

• 1:48:10John Coogan?

  Great news. We'd love to see it. Congratulations to everyone over there on the Microsoft team. They needed a win.

• 1:48:19Jordi Hays?

  Folks, it's been an honor and a privilege to podcast for you this week.

• 1:48:22John Coogan?

  Yes.

• 1:48:22Jordi Hays?

  And I can't wait for next week.

• 1:48:24John Coogan?

  Wait, is there something else, Ben? No, you're good? Okay.

• 1:48:27Jordi Hays?

  We'll be back in the Ultra Dome. We're going to have a lot of coverage this weekend too, around, uh, our new, some of our new.

• 1:48:34John Coogan?

  Initiatives.

• 1:48:35Jordi Hays?

  Getty, you, you may have been seeing some of our Getty images.

• 1:48:38John Coogan?

  Yeah.

• 1:48:39Jordi Hays?

  You might be seeing some more.

• 1:48:40John Coogan?

  Yeah, we're working on it.

• 1:48:41Jordi Hays?

  We'll see.

• 1:48:41John Coogan?

  But have a great weekend.

• 1:48:43Jordi Hays?

  We'll see you Monday.

• 1:48:44John Coogan?

  See you Monday. Leave us five stars on Apple Podcasts and Spotify. Sign up for our newsletter, tbpn.com. Goodbye.