Crypto Going "Bunker Mode", The Mathpocalypse, Starbucks Explores Chipotle Takeover | Rebecca Kaden & Michael Mignano, Nathan Benaich, Michael Sindicich & Healey Cypher, Moritz Stephan, Anastasios Angelopoulos, Zach Yadegari

(01:18) - Crypto Going "Bunker Mode" (16:31) - The AI Mathpocalypse (28:08) - Starbucks Explores Chipotle Takeover (30:57) - Timeline Reactions (49:01) - Mansion Section (55:41) - Rebecca Kaden & Michael Mignano discuss USV’s record $900 million fundraise and how the firm is adapting its thesis-driven investment strategy to larger rounds, longer private-company timelines, and AI-enabled opportunities. A partner at USV, Rebecca highlights the firm’s focus on visionary, product-oriented founders, public idea-sharing, emerging technologies, and company incubation. (01:16:52) - Nathan Benaich discusses the State of AI Report and his balanced, research-driven view of the industry. The Air Street Capital founder highlights AI’s rapid progress, the rise of inference and reinforcement learning, and how capital, infrastructure, and user education increasingly constrain adoption and growth. (01:31:41) - Michael Sindicich & Healey Cypher discuss BoomPop's acquisition by Navan and the immediate integration of its event-planning platform and team. They emphasize the importance of in-person meetings and explain how the combined company will provide customers with a unified solution for business travel, off-sites, and corporate events. (01:38:24) - Moritz Stephan discusses Hone, an AI company building autonomous “engines” that own and deliver business outcomes. He explains how the platform tackles complex workflows across revenue, recruiting, finance, and procurement, while exploring scalable deployment, outcome-based pricing, and adaptable templates for organizations. (01:48:26) - Anastasios Angelopoulos discusses Arena’s expansion from evaluating AI capabilities and human preferences to measuring agent alignment and safety. The co-founder and CEO explains how Arena uses real-world data to identify unauthorized actions, deceptive completions, and false attribution while serving as a neutral evaluator of AI models and agents. (02:02:56) - Zach Yadegari, an entrepreneur who sold his calorie-tracking company Cal AI, discusses his new AI assistant venture and its $10 million funding round. He outlines plans for a free, money-saving consumer product and screenless hardware designed to integrate computing into daily life while reducing phone use. (02:15:04) - Mansion Section p.2 TBPN is made possible by: Ramp - https://ramp.com Public - https://public.com Cisco - https://www.cisco.com Console - https://www.console.com CrowdStrike - https://www.crowdstrike.com Figma - https://www.figma.com MongoDB - https://www.mongodb.com NYSE - https://www.nyse.com Railway - https://railway.com Shopify - https://www.shopify.com Codex - http://openAI.com/codex Follow TBPN: https://TBPN.com https://x.com/tbpn https://open.spotify.com/show/2L6WMqY3GUPCGBD0dX6p00?si=674252d53acf4231 https://podcasts.apple.com/us/podcast/tbpn/id1772360235 https://www.youtube.com/@TBPNLive

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

• 0:00John Coogan?

  Year one.

• 0:04John Coogan?

  Today is Thursday, October 8, 2026. We are live from the TVP in Ultra Dome. The temple of technology, the fortress of finance, the capital of capital. Let me tell you about ramp.com. Time is money. Save both. Easy use corporate cards, bill pay, accounting, and a whole lot more, all in one place.

• 0:25John Coogan?

  How many days until Christmas?

• 0:27Jordi Hays?

  I have a better question. How many hours?

• 0:30John Coogan?

  Oh, we're counting down the hours now. Okay. There are 1,862 hours until Christmas. Get ready, folks.

• 0:40Jordi Hays?

  Yep, that's right.

• 0:41John Coogan?

  We're counting.

• 0:42Jordi Hays?

  We've moved from days until hours. That's how close we are.

• 0:45John Coogan?

  That's.

• 0:47John Coogan?

  It is October.

• 0:47Jordi Hays?

  We're just hours away.

• 0:48John Coogan?

  It is early October. We're hours away from Christmas.

• 0:54John Coogan?

  We are technically hours away from Christmas. That's correct. Yes. Anyway.

• 0:59Jordi Hays?

  We're only 1,800 hours away from Christmas.

• 1:02John Coogan?

  Yeah. It's it's the apocalypse day. There's there's so many apocalypses. Mathpocalypse. There's crypto apocalypse going on, although the market is reacting in a very moderate way, but the timeline is being dramatic, so we got to break that down. Ethereum founder Vitalik Buterin and others in crypto are sounding the alarm that AI-driven math could threaten blockchain security. And so crypto is going bunker mode. That's the term that they're using. So we've all seen the progress in AI-driven math, solving new proofs, solving Navier-Stokes.

• 1:43John Coogan?

  There's a lot of impressive progress in math that maybe has applications in physics, maybe has applications in engineering, fluid dynamics. A lot of these things are further out. And if they wind up being useful, they might increase efficiency here.

• 2:03Jordi Hays?

  Not as far out as you think.

• 2:05John Coogan?

  But the big thing is that crypto is here today. And if there's an advance in the underlying understanding of how cryptography works, it could really re-shake. It could really shake up how the crypto industry works and how these products are secured. So are they in danger?

• 2:26Speaker 02

  cortisol rising.

• 2:27John Coogan?

  It's the Ralph Wiggum meme, I think. I'm in danger. Seeing all this. Matthew Green, who teaches cryptography at Johns Hopkins, Johns Hopkins, put the situation in stark relief. He said, I think we might lose public key cryptography, which is a which is a huge statement from an expert in cryptography. It would require a pretty massive restructuring of many security protocols, but also the crypto industry. At the moment, cryptography has as a discipline, has been exempted from the list of published papers related to AI-enabled math breakthroughs. So there were hundreds of papers and it's very clear that either the

• 3:12John Coogan?

  agent swarms that were sent to go solve math problems, they said, hey, don't even bother with any cryptography stuff. Or if they did, they didn't publish those and they're burying them for now until there's a way to actually patch those.

• 3:27Jordi Hays?

  Or maybe the cryptography is just too strong.

• 3:29John Coogan?

  That's true. That's a that's a third option. The crypto industry is a little skeptical about it. They think, man, there might be some flaws. Of course, they've been preparing for things like this before. Quantum computing is potentially existential to many blockchains. And so there has been the concept of Q Day and how they work backwards from that to make sure that they are quantum resistant.

• 3:51Jordi Hays?

  The interesting thing is like historically, when the crypto industry has faced, you know, headwinds, the strategy has been hodl.

• 3:59John Coogan?

  Hodl.

• 3:59Jordi Hays?

  And that's not necessarily going to be effective for this next chapter.

• 4:04John Coogan?

  That's true. Yeah, that's a good twist. Of course, there are very weird dynamics where if you break all the Bitcoin keys and all the wallets wide open and you completely erode all the trust that's been built up in that in that virtual currency. Yeah, you stole it all, but it's worth nothing. And so the game theory there of no one would ever want to steal all the Bitcoin, right? So it's more like, can someone go after long tail?

• 4:34Jordi Hays?

  I'm sure there's some people that would do it just for the love of the game.

• 4:36John Coogan?

  To watch the world burn Joker mode? Yeah, that's probably possible. We could be seeing a Jokerfied. Oh, you have the Joker ready to go. Yeah, a Jokerfied AI agent swarm would be a bad situation.

• 4:51Jordi Hays?

  Yeah.

• 4:52John Coogan?

  For sure.

• 4:54John Coogan?

  But there is some cause for optimism, you know, much like the broader cyber security scare that happened back in March of this year. There's a gap between closed source and open source models. Most people say it's around six months, you know? The capabilities catch up in certain areas. It seems like it's faster. Sometimes it's three months, but six month is sort of a useful heuristic I have found. And that actually maps out pretty, pretty, pretty perfectly with the most recent news. So if you remember, Mythos preview was dropped by Anthropic on April 7, 2026. It's the fourth month of the year.

• 5:37John Coogan?

  And then CrowdStrike announced that a 26-year-old in China used a open source Chinese-developed AI agent to execute cyber attacks against South Korean banks on October 7, like the same. I think the report came out October 7. So it's basically just exactly six months later. You see like a open source model be used in a cyber attack. Now, fortunately, the the banks have, you know, a ton of redundancies, the ability to roll back transactions, they store things to tape, they store things on paper sometimes. There's a lot of different ways to secure a traditional bank that is not purely digital,

• 6:19John Coogan?

  even though they might have a digital front end and a lot of the money might be stored digitally. And the interesting thing is that when I read at least about one of the South Korean bank cybersecurity incidents, it was a pretty small amount of user data that was stored. It was like names and addresses and like phone numbers of like,

• 6:41John Coogan?

  it was a significant number. It was like tens of thousands of clients or something like that. But it wasn't like they robbed the bank and they got the money or they got everyone. Somehow they got into like one system for information. So it could have been like they they hacked into like, like their paperless post account. That was like the what the bank used to send out invites to clients or something like that. Like there are a whole bunch of different systems and and where and what level did they get in is important. But it's clearly happening.

• 7:09Jordi Hays?

  They got into the client gifting software.

• 7:11John Coogan?

  Potentially.

• 7:11Jordi Hays?

  Everyone chocolates.

• 7:13John Coogan?

  Maybe, maybe. And so obviously you don't want hackers anywhere. And so cybersecurity is more important than ever. And so the crypto community does have, you know, a couple of months to go bunker mode as they are putting it. And it feels like there'll be an incredible amount of progress on these like AI proofing systems, but it's an entirely new challenge. It's very, it's less, much less understood than quantum computing, which has been theorized mathematically and sort of formalized for years before the capability came. This is different because we're getting this capability before we've really characterized the shape of the threat. Like, like they know with with quantum, like there's something called Shor's algorithm.

• 7:58John Coogan?

  And like, they got to fix that. So they got to make sure that Shor's algorithm doesn't work to break Bitcoin wallets open. They know the mathematical problem. They got to solve that. In this scenario, it's like there might be a different algorithm that runs on commodity hardware that works. And how do you know when you don't know the shape of the threat that's coming? So it's it's a crypto apocalypse potentially, but the market doesn't think it is. Bitcoin's only down 3% today and it's still up 3% for the month. And so the the market is, you know, digesting this and optimistic. There's still, you know, lots to do if you work in crypto and potentially, even if you only own some crypto, there's things to do.

• 8:41John Coogan?

  Vitalik gave some recommendations on, you know, don't panic, but also maybe start thinking about this more intently. He said, I don't recommend anyone scramble to move their funds to new wallets today, but we should take the risks of cryptography from AI-accelerated math seriously and minimize our exposure to not just quantum vulnerable cryptography, but also AI-vulnerable cryptography. The new core area of risk from this viewpoint is unfortunately MLDSA, FAG, lattices. And this is also another reason, along with quantum, why ECD SA

• 9:21John Coogan?

  might fall even faster than expected, hence the fresh address recommendation. So far, most people have been in the mode of thinking elliptic curves, broken hashes, safe, lattices, safe. But there's a good chance that in the concrete security, that the concrete security of lattices will take serious hits from the next two years of AI math. And so some people were were posting, Scott Liu here was saying, oh, that's weird. The AI math god is somehow no better at cryptography than than a 2026 human. We got super intelligence in math, but not cryptography. What's going on? He thought for a minute.

• 10:02John Coogan?

  And I think the interpretation of this, and you can tell me if you disagree, is, yeah, it's because the AI math god is run by a American company that has no interest in destroying Bitcoin.

• 10:16Jordi Hays?

  Total chaos.

• 10:17John Coogan?

  Yeah, but.

• 10:19John Coogan?

  In the open source world, it's a very different game.

• 10:21Jordi Hays?

  Yeah.

• 10:22John Coogan?

  And so still, still interesting to think about the, still interesting to think about the, the game theory even in the open source world, but I think that will all be downstream of a whole bunch of changes. And then there is the question of, you know, how, how does, how does crypto handle this? Like the cryptocurrency industry has been libertarian. They've been against the government in many ways, small government. I want to own the money. Well, now you're facing a threat from open source, from a non-government regulated entity. And so while a lot of people in the AI safety community have said, this is the moment for big government. This is the moment to register large clusters. This is the moment to track all the data centers,

• 11:07John Coogan?

  to, to have licenses for inference and training and, and reporting to the government. That is a solution. Like if you lock down open source and you say, yeah, you like, if you're going to spin up a million agents and, and try and do a bunch of inference to try and break Bitcoin wallets, like we're going to find out about it. We're going to arrest you. And it doesn't matter that you're using it up to the model. That's a very different psychological frame of mind for a Bitcoiner.

• 11:33Jordi Hays?

  Yeah. The, the other thing here is that there's obviously bio risk with, with model advancements, but it is going to be wildly different for somebody to use an obliterated model to try to create a bioweapon and then actually sort of distribute that out into the world than like using a new model to try to like mess around with cryptography.

• 11:53John Coogan?

  Yeah.

• 11:54Jordi Hays?

  That feels squarely in the hacker camp. Like there's people that would just be kind of messing around and then accidentally have a breakthrough or accidentally, or maybe intentionally cause financial chaos. But that's purely digital. And that's the kind of thing that millions of people have been doing for a very long time. Just generally kind of hacking around wildly different than the kind of person who would go out and try to create, you know, a new pandemic.

• 12:22John Coogan?

  Yeah. And it also, yeah. And then also another layer will, of this will feed into like the whole AI doom, loss of control scenario, because you get an AI agent that's hyper intelligent and it's also able to break Bitcoin wallets. It breaks a couple open, then it has capital. With capital, it can marshal more compute, hire people to do things in the real world, et cetera, et cetera. And so the, the, the doom scenario becomes like way more human enabled if you are able to amass capital pretty quickly as a rogue agent. Do you have a take on this Tyler?

• 13:01Speaker 03

  Uh, yeah. I mean, I feel like the crypto industry broadly is like fairly good at self governance, right? You've seen like, even if you're talking about like Bitcoin, you know, there's like, they can actually like change the protocol, you know, you like Bitcoin Cash, which is the, the shoot off stuff like this. I think the Bitcoin Policy Institute, like, um, I don't know, maybe, maybe a month or two ago, had this open letter about how, uh, you know, the solution is we get to build up defenses much more and we've got to use, uh, you know, spend a lot on inference to try to like figure out what, what is the right path going forward. It's, I, I think most people are very against like limiting open source models, stuff like that.

• 13:35John Coogan?

  Totally. Yeah. It'll be, it'll be interesting to see how these, how these like worlds collide and, and where things go. Um, I had some other take, but, um, let me 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. Thank you for the continued clapping.

• 13:59Jordi Hays?

  Ben, I don't know if we, you included this earlier, but he says, lucky coincidence, the labs are only successfully cracking esoteric math problems and not the problems where a solution would give the winner an asymmetric commercial advantage. Again, this is what I've said a bunch of times on the show now. Uh, math problems are the perfect category of problems where you get a result and you're, you know, incentivized and excited to share the result. There's no immediate opportunity to commercialize a lot of, a lot of this stuff.

• 14:26John Coogan?

  Yep.

• 14:27Jordi Hays?

  And so for every, for every breakthrough in math, you should assume there's, and the reason this should be getting everyone excited is you should assume there's a bunch of other breakthroughs in other fields that have more commercial applications where the person that has, and, and it's not just the labs, it's people using the current frontier models to find breakthroughs in their own field. And so I'm, again, I'm expecting a, you know, a real explosion of progress, um, you know, especially as we enter the later half of this year.

• 14:59John Coogan?

  Yeah.

• 15:00Jordi Hays?

  Or the, or the sort of

• 15:01John Coogan?

  The

• 15:02Jordi Hays?

  End of the, end of the

• 15:03John Coogan?

  I, I believe Will Depew posted about this. That's what I was thinking of. Will Depew posted, uh, I think there was like a slight Bitcoin sell off like a while ago, like maybe around the mid summer time period. And he sort of took a victory lap or something. It was like saying like, yeah, in hindsight, once we, once like the AI community built like the Hack Machine 9000, uh, it should have been obvious that, uh, you should get out of crypto. Uh, and then what was odd was that crypto rallied after that. So like he was kind of a little bit too early with the take, but now it feels like, okay, everyone's pieced it together a little bit more. But also there's so many other factors where

• 15:45John Coogan?

  you could see this narrative dying down and all of a sudden there's some other narrative that's driving crypto and people are piling in for whatever reason. Um, but, uh, it was, uh, yeah, maybe like, you know, even in a, even it's been, you know, pitched as an inflation hedge. There's always been people who have said the, the restricted supply is valuable. You could have a view on inflation that becomes really popular and then all of a sudden people are piling in. There's a whole bunch of reasons why the market can move. Uh, it's not purely driven by this, but it was, it was funny that, uh, he, he was posting about this like months ago. Um, anyway, moving on. Console.com. Console builds AI agents that automate 70% of IT, HR and finance support, giving employees instant

• 16:27John Coogan?

  resolution for access requests and password resets. Uh, so OpenAI's drop of hundreds of new mathematical proofs is now being called the mathpocalypse. There's some white pills, there's some black pills. People are all over the place. Obviously we talked about the crypto knock on effects. Um, Nabeel Kreshi says mathematicians, AI is plagiarism and we don't want to know the answers anyway. Artists, AI is plagiarism and the art sucks anyway. Chess players, hmm, I wonder if I can use AI to increase my rating. Uh, because there are some people that are just delightful with, um, delighted with advances and not really, uh, you know, frustrated by it. There's actually

• 17:11Jordi Hays?

  Yeah. How do you, how do you prevent against like botting in online chess?

• 17:17Jordi Hays?

  Like couldn't you, can't you just be like running your own, like, like

• 17:22John Coogan?

  I don't know.

• 17:22Jordi Hays?

  And I'm comparing that to like, let's say somebody using like an aimbot.

• 17:25John Coogan?

  Yeah. No, no, I mean bots are like undetectable. Like all the bots can like one-shot captchas and, and fake.

• 17:32Jordi Hays?

  But not even that, but basically just running like an AI co-pilot.

• 17:35John Coogan?

  Yeah.

• 17:35Jordi Hays?

  That is like helping you make.

• 17:37John Coogan?

  But

• 17:37Jordi Hays?

  So unless you're playing chess physically in front of somebody and watching them, you know.

• 17:41John Coogan?

  Yeah. And then, and then what do you think?

• 17:43Speaker 03

  Well, uh, I mean, if you're like elo is like 800 and then you start making like, you know, 2000 rated moves, like it's pretty easy to tell that stuff.

• 17:50John Coogan?

  Yeah.

• 17:51Speaker 03

  It's like, I, I think like if you, if you're on chess.com or whatever, it's like, I think it's fairly hard to cheat.

• 17:57John Coogan?

  Hard to cheat? Or, or people just don't cheat because it's like, what's the point? And like, it's like, okay, yeah, I played against somebody who was like smurfing and they had an 800 elo account, but they were clearly playing a 2000 elo. Like, okay, I lost that game. Let me queue again. Okay. I got someone who's actually 800 and I'll just keep playing until I get someone who's actually my

• 18:18Speaker 03

  Yeah, that's probably true. But if you're consistently using like an engine, it's like, I think it's not that hard to figure that out.

• 18:25John Coogan?

  Yes, but like, this is going to change. Like, because like the models will be so good.

• 18:32Speaker 03

  It's over.

• 18:32John Coogan?

  That, I mean, the models will be so good that you'll be able to say like, I'm, I'm elo 800, help me play at 850 and also really mimic the human experience. So don't make, don't

• 18:46Speaker 03

  But yeah, I agree. There's like little incentive to actually cheat on chess.com.

• 18:49John Coogan?

  Yeah.

• 18:50Jordi Hays?

  Uh, Gold says you can tell if they're bots if they're statistically always or nearly always make the optimal move.

• 18:55John Coogan?

  Yeah, exactly. Like there's no fun and you can always just go play against the best stockfish model if you want. Like you can just max it out. If you just want to play against the best computer in the world. Nobody does. And so there's not that much value in it because everyone would just be like, cool. Yeah. You just ran the model that everyone else has. Like, do you want to play against me or not? Like if you want to just be the model, just go and you don't win anything. So there's not any incentive, I think. I think that's how it works out. I don't know. Uh, I do think, yeah, I mean, in the future, like you will be able to

• 19:28Jordi Hays?

  I mean, you, you in the gym have been accused of using, you know, robotic assisted lifts, right? You'll wear like big sweatpants and you're on the deadlift.

• 19:38John Coogan?

  Can you imagine having

• 19:40Jordi Hays?

  And you have, you know, your exoskeleton, you know, putting up, you know, 800 pound deadlifts. I mean, people, you know, know you're strong, but not that strong.

• 19:48John Coogan?

  They're skeptical. Yeah. I don't know if you'd get a lot out of that. You could bring fake weights. That's, that's one way. I mean, people do stuff, but then why not just Photoshop it? Why not just go and Photoshop a screenshot of you on your, your profile on chess.com with a 4,000 elo? And then share that on X and be like, I'm the best chess player ever.

• 20:12Jordi Hays?

  But if someone fact checks it, then you just look like Nate.

• 20:15John Coogan?

  Yeah. And so eventually you have to get down to like fact check by walking through a metal detector and going to an actual chess match because like, oh, you're really better than Magnus? Let's see if you're better in person, you know, that will, that, that's what will happen. And so there's like, like you're going to wind up, you're going to wind up in the, in the, in the Faraday cage with, with Magnus eventually. I don't know. Um, anyway, let me tell you about Shopify. Shopify is the commerce platform that grows with your business and that's yourself. In seconds, online, in store, on mobile, on social, on marketplace, and now AI agents. There's, there, there's a very interesting post in the, in the Wall Street Journal about a former NFL lineman who solved a decades old math problem.

• 20:56John Coogan?

  Uh, John Herschel gave up his career with the Baltimore Ravens to study math at MIT and he has-

• 21:03Jordi Hays?

  Get this guy on immediately.

• 21:05John Coogan?

  He, he's so jacked. Uh, it looks like, uh, yeah, he's, he's definitely, doesn't need the exoskeleton in the gym. Uh, he's a former NFL player, John Herschel, decided to do some light reading this week. And for him, that meant leafing through the latest math papers from OpenAI about topics such as the Reiman hypothesis. Oh my Lord, he thought, I was absolutely floored. Good rhyming. Uh, Herschel was blown away by the findings because he happened to understand the hundreds of proofs better than nearly any human on the planet. Nine years ago, he traded the National Football League for the, uh, the Massachusetts Institute of Technology. Uh, crazy that you can take like that. I think the NFL has got to be an incredibly demanding schedule.

• 21:50John Coogan?

  Like you can take like thousands of hours off of your like math career and then like go back in the game and not be-

• 21:58Jordi Hays?

  Well, not to mention getting just slammed in the head.

• 22:03John Coogan?

  Yeah. Oh yeah. They want you to believe in CTE, counter example.

• 22:07Jordi Hays?

  Make it make sense.

• 22:08John Coogan?

  One of one sample counter.

• 22:10Jordi Hays?

  No, he's possible. He's actually the smartest person to have ever walked the earth. So even after getting-

• 22:17John Coogan?

  Yeah. Or, or it could be reversed. You get hit in the head and it like makes you even more of a genius or something.

• 22:22Jordi Hays?

  Yeah. Unstuck something.

• 22:24John Coogan?

  Yeah. Sort of like a, like a magical realism.

• 22:28Jordi Hays?

  Tyler, is this gonna make you get into watching football?

• 22:32John Coogan?

  Yeah, maybe you should play some-

• 22:34Jordi Hays?

  Future-

• 22:34John Coogan?

  Maybe you should play some full contact tackle football. Might make you better at math. You never know.

• 22:41John Coogan?

  Herschel was blown away by the discoveries and Monday, instead of studying abstract play designs, he was publishing some impenetrable language of his own to prove a decades old math conjecture. Herschel's paper titled, On the Growth of, On the Growth Factor of Random Matrices, is one of a deluge of AI assisted proofs that mathematicians have achieved in this new era, when they can combine their genius with supercomputing power. But within this community of brainiacs, there isn't a single person quite like the 35 year old Herschel. Uh, after three years at the Baltimore Ravens, the offensive lineman,

• 23:19John Coogan?

  who is listed at six foot three, 313 pounds, ditched his helmet and became a professional egghead in 2017. He hasn't regretted for a moment. He says, I feel like I bet on myself in a big way. I'm living my best life right now. You'll love to see it. Long before Herschel became an assistant professor at MIT studying matrices, spectral graph theory, and other subjects that sound like gibberish to just about everybody, hot shots fired by the journal, uh, but I agree. He was an overachieving kid attending Penn State while playing for the Nittany Lions. He did more than pursue an ambitious major by studying math and win, and he won the prize known as the academic Heisman. By the time the Ravens drafted him in 2014, he already had earned his masters.

• 24:03John Coogan?

  Uh, but a year after protecting Joe Flacco, Herschel started to miss his life crunching numbers. While he felt his analytical background was useful to him as a football player, for instance, it's a, he says it helped him learn the playbook. It didn't quite scratch his intellectual itch. That's when he decided to apply to become a doctoral student at MIT, the school he had always dreamed of attending. He became moonlighting there in 2016. And so-

• 24:27Jordi Hays?

  I know, I know what this is all setting up.

• 24:30John Coogan?

  What is this?

• 24:31Jordi Hays?

  He is gonna, he is gonna star in the next Terminator movie.

• 24:35John Coogan?

  Ooh.

• 24:35Jordi Hays?

  Football player, math genius, fights back against X-Files.

• 24:39John Coogan?

  Triple threat. Yeah, this is exactly-

• 24:41Jordi Hays?

  Takes on the clankers.

• 24:42John Coogan?

  Yeah, I, I would love to see it.

• 24:44Jordi Hays?

  I mean, you would hate to be a clanker with this, with this guy walking you down.

• 24:48John Coogan?

  For sure. But he seems to be, uh, he seems to be a friend of the clankers because, uh, he has actually been using AI in, to assist him in his research. So, uh, his acknowledgements in the paper that he published cites the help of OpenAI models and says that he welcomes any question about the role of AI, which is upending his entire field. Uh, he says, but supercomputers haven't dented the passion that this football player turned mathematician has for math. He compares it to his enjoyment of chess. He also likes chess. Uh, the computers are better than the humans, yet he stills enjoy, yet he still enjoys the pursuit of finding the right move.

• 25:29John Coogan?

  I really want to understand the why of things, Herschel says. It doesn't ruin the why. AI doesn't ruin the why. That's a very interesting thing. And I feel like, I mean, just in knowledge retrieval over the past three years, I have felt that, like, like I know a lot of obscure factoids about Silicon Valley lore, you know? But when ChatGPT came out, I wasn't like, oh no, like the computer knows more about Silicon Valley history than me. They're like, oh no, like the computer knows more about the, you know, the random companies.

• 26:07Jordi Hays?

  You're basically, you're basically one of the top guys in your field.

• 26:12John Coogan?

  I mean, I did spend like five years making, uh, YouTube documentaries about these companies and like trying to learn a lot and like piecing it all together. And like ChatGPT can do that, but like it's been such a benefit because I, I want to know. So I'm looking up stuff all the time and I'm like, I want to go on the journey. I want to gain that information and it gives that to me. It's weird. Very, very, very weird.

• 26:32Jordi Hays?

  We benefit from, we, we benefit from having knowledge and understanding within us. Like it's nice to go through life.

• 26:39John Coogan?

  Yeah.

• 26:39Jordi Hays?

  And be able to understand things in real time versus reaching, just because you have complete access, you have complete access to all the information you need and-

• 26:51John Coogan?

  Yeah. Yeah. I mean, there's still obviously the jobs question. How do you monetize that? If your job was just solving math problems or your job was just, uh, you know, assembling, you know, sloppy research reports. Uh, you, you, you might be going through a process now, but, uh, I don't know. I, I'm still, I'm still optimistic. I, I still, uh, I still feel like we're going to be hearing from, uh, this gentleman, John Herschel for a very long time.

• 27:21Jordi Hays?

  Yeah.

• 27:22John Coogan?

  Maybe he's like, you know what? I'm going back to, I'm going back to football. Math is solved. I'm going back to football. No, I don't know.

• 27:27Jordi Hays?

  When, when, I wonder when he actually gave comment for this article.

• 27:31John Coogan?

  Uh, this was like yesterday. Uh, I mean, this literally posted today at 8am. So I imagine that he was on the phone with the Wall Street Journal over the past like two days. Uh, cause it's a pretty detailed profile. Uh, we should get him on the show. I, I'd be fascinated to hear about what he thinks. Yeah. I mean, I, I think people will be continuing to study this stuff for, for a long time. Um, and, and, and learning it to apply it for their, for their, for themselves. Uh, anyway.

• 27:58John Coogan?

  Christian Seigel's memeing it. He says, OpenAI, we literally solve math. Uh, him says, nice one. Now please use the Door Dash CLI to order me some orange chicken. Speaking of ordering food, Starbucks is thinking about buying Chipotle or they thought about buying Chipotle. Uh, the headline is Starbucks has explored taking over Chipotle, according to a Financial Times report. This is a scoop in the Financial Times. Um, let's see, they've explored merging the two companies in a mega deal. It would be a $41 billion market value for the burrito chain. And it would rank as the largest restaurant acquisition of all time.

• 28:39John Coogan?

  So the world leading coffee shop chain has worked with advisors in recent months on a takeover proposal for Chipotle, which I believe had McDonald's as an anchor investor a long time ago. I don't know how, how divested they are at this point, but, um, it, it's interesting to see that they're, they're finding another dance partner. Uh, a burrito chain with a $41 billion market cap. Uh, the status of Starbucks's takeover plans and whether the company has submitted any formal offers to Chipotle could not be determined. Uh, a transformative deal of this size might struggle to get off the ground, the people warned, and a tie-up may never materialize, given the complexity of combining two consumer giants. Uh, the early stage plans would also reunite Brian Nichols, Starbucks chief executive with the fast food chain,

• 29:23John Coogan?

  where he made his name over six years since as a CEO. So he was, he left Chipotle, uh, August 2024, went over to, uh, Starbucks from Chipotle. Chipotle has, uh, lost half of its value in that time. So, he was, you know, performing well there, but maybe it's an opportunity to put them together. The combined market cap would be like 102 billion and-

• 29:45Jordi Hays?

  It's also just what, what the, you know, fast casual had been on a crazy run across the board. So I don't think it was, I don't think it was him leaving that, that caused the decline, but-

• 29:55John Coogan?

  Yeah.

• 29:56Jordi Hays?

  He clearly loves the brand. Um, man, it is so crazy to think about. There was a time in my life where I was actually averaging one visit to Chipotle every day.

• 30:08John Coogan?

  Every day.

• 30:08Jordi Hays?

  You know, some days I wouldn't go, but other days I'd go twice.

• 30:12John Coogan?

  Have you ever daily driven Starbucks?

• 30:13Jordi Hays?

  And now I'm not even averaging once a year.

• 30:15John Coogan?

  Whoa. Yeah. Just moved on. What about Starbucks? Have you ever been a Starbucks guy?

• 30:21Jordi Hays?

  Nah, so, so, so bad.

• 30:24John Coogan?

  You don't like Charbucks? That's the whole thing. Uh, Starbucks, the, the, the coffee is like burnt often. Or like, it's a little bit more towards burnt. So they call it Charbucks. But it's, I think it's because people at the time liked it, so that was more popular. And then they add so many things on top of like caramel and whipped cream that like you can offset the, the harshness of the raw black coffee ingredient.

• 30:50Jordi Hays?

  We got mosquitoes on the set.

• 30:52John Coogan?

  Lock in. Get the, get the flyswatter. Do some damage.

• 30:56Jordi Hays?

  I'm shooting it away.

• 30:57John Coogan?

  Uh, Mike Isaac says coworker who clocks in to work carrying a venti whole milk quad latte in a double steak burrito bowl and heads straight to the bathroom. Lots of jokes like that. Uh, PepsiCo, uh, says some really bad things. Joe Weisenthal shared PepsiCo CEO, we don't feel good about the beverage business.

• 31:21John Coogan?

  PepsiCo CEO, we're putting all the urgency to improve sodas. Yeah. Should they add alcohol to the sodas? Topo Chico, the sparkling water brand, created a alcoholic seltzer. Do you think there should be Pepsi, Pepsi Zero, Diet Pepsi, Pepsi Max, Pepsi spiked? What do you think?

• 31:43Jordi Hays?

  I think they should be optimizing for Pepsi Pro Max Ultra.

• 31:47John Coogan?

  Pro Max Ultra. Yeah. It is interesting that, you know, Coca-Cola never did like a rum and Coke. You could just do that if you were trying to just skew Max and get the most number of stock keeping units around.

• 32:03Jordi Hays?

  Yeah.

• 32:04John Coogan?

  I don't know.

• 32:04Jordi Hays?

  They should make a, the Pro Max Ultra should be like a Magnum size bottle of soda. That's where things are headed.

• 32:12John Coogan?

  Okay. Well, let me tell you about Railway. Railway is the all in one intelligent cloud provider. Use your favorite data to deploy web app service databases more well Railway automatically takes care of scaling, monitoring and security. The last apocalypse, the ARR apocalypse, or no, no, that's, this is the third of fourth of four apocalypses. We got a housing apocalypse coming up, but OpenAI reports revenues differently than Anthropic. And so there was a leak that said OpenAI was at almost 70 billion. And then there's another report today that says they're almost at 50 billion. And it's very clearly clear that like the numbers are very closely held. And then there's a game of telephone happening with investors and LPs and other investors.

• 32:54John Coogan?

  And then by the time things make it to the press, it's all over the place and it sort of shifts and people, you know, true up the numbers to try and create an apples to apples comparison. If you're not following the, it's like on AWS, if you buy an OpenAI model, OpenAI keeps that dollar as revenue and Anthropic gives some of that to Amazon. They both probably give some to Amazon, but Anthropic counts the part that they give to Amazon as a cost. And so they, they have a higher gross revenue number. And so making these companies apples to apples, it seems like that's what someone tried to do a little bit, but I don't know. It seems like they did it sloppily.

• 33:34Jordi Hays?

  Yeah, yeah.

• 33:34John Coogan?

  It seems like they did it sloppily.

• 33:35Jordi Hays?

  Still very unclear. And yeah, it's unclear why it didn't get corrected faster.

• 33:43John Coogan?

  Yeah. So.

• 33:45Jordi Hays?

  But I, but I mean, like extremely different, difficult environment to be operating in. Because part of the benefit of being a private company is that you, I mean, that like one of the biggest benefits, you don't have to be on this constant reporting schedule.

• 34:03John Coogan?

  Yeah.

• 34:04Jordi Hays?

  But at the same time.

• 34:05John Coogan?

  You're like moving to public markets.

• 34:06Jordi Hays?

  Yeah. Because you're, because these companies are at a scale.

• 34:09John Coogan?

  Yeah.

• 34:10Jordi Hays?

  Where they, so much of public market activity is predicated on, on their metrics.

• 34:15John Coogan?

  Yeah.

• 34:16Jordi Hays?

  It's sort of, you, at time, you know, it's prudent to actually share these numbers at different times, but there's also so much, I mean, all, all the different media companies are working. In a, in a perfect world, the legacy media would be like, have a new article every day that just had all the updated numbers. Like what was, you know, they would, they would love to public.

• 34:40John Coogan?

  Maybe like a quarterly report.

• 34:41Jordi Hays?

  Here was yesterday's revenue.

• 34:43John Coogan?

  Go on a website like Edgar online, you could call it Edgar online and, and file it with this SEC. There could be a, there could be a whole commission around securities and exchanging securities. Yeah. I mean, Sam, Sam's been talking a lot about IPO stuff. He, what was his, what was his take with Vanity Fair? He had, he had something about IPO timeline, like he'll do it when he needs to do it, whatever. The interesting thing is that I, I do feel like the, like IPOing is, is aligned with like better corporate governance, getting, you know, distributing the gains, like yes, like actually get the stocks of all the labs

• 35:24John Coogan?

  into the retirement accounts. That was very controversial with SpaceX. When SpaceX went out, people were like, I don't want it in my 401k. But there is a scenario, of course, it's like cap weighted. So you don't need to actually, or float weighted. So you don't actually need to worry about it like blowing up your retirement account. But there's a, there, there's a good case for like, okay, if this really is really, if like the bull case is true, like yeah, distribute the gains through everyone's investment accounts, getting slices of it just immediately. Because that's the way things diffuse through the public markets. Cause everyone owns ETFs. Everyone has, has some, some money invested in the market. It becomes much easier than like the small group of insiders.

• 36:04John Coogan?

  There was this rumor that we were digging into which, which is like, is someone trying to manipulate the market? Because if you leaked a number about a private company, normally that wouldn't move the market because everyone's like, oh, who cares if like some tiny company like is, you know, doing okay on revenue. Like if I, like if we leak that like Lucy's doing a real, oh, we're going to blow out revenue this year.

• 36:29Jordi Hays?

  There was no point, there was no point even look at, even look at one of the greatest companies Silicon Valley's ever produced, Stripe. There was no point where if Stripe, if it leaked that Stripe had like missed their numbers for a quarter that like you would see.

• 36:43John Coogan?

  Like Visa spike.

• 36:44Jordi Hays?

  Yeah.

• 36:44John Coogan?

  Or Mastercard spike. Yeah. It wasn't really moving the market in that way. Completely different with OpenAI and Anthropic, like SpaceX, Oracle, SoftBank, like there are plenty of public company proxies. And so it would be tempting if the SEC didn't exist to, to go and leak a number that's better than what's true. And then sort of buy the rumor, sell the news. So you would, you would buy and then leak a really high number. That's just a rumor to the press. And then, and then when the real number comes out, you're already short. So you're, you're catching that on the way down. This would be securities fraud, by the way. So don't do that. But it is, it is a wild, wild, wild thing that we haven't seen before.

• 37:28John Coogan?

  Because manipulating public stocks with private company information just hasn't been viable in size before. Maybe very, very tiny here and there. But there are some cases out there that make it very, very clear. False acquisition rumors are, are popular. In 2008, the SEC sued Paul Berliner, a trader, fabricated a rumor about a Blackstone acquisition while shorting the target's stock. Media outlets picked it up and the stock briefly fell 17%. Berliner settled SEC fraud and manipulation charges. And there's been, there's Citron Research founder on securities fraud scheme around.

• 38:11John Coogan?

  Prosecutors allege that he used influential public commentary while misleading investors about his trading intentions. The case did not require the same fabricated revenue fact pattern. So just interesting dynamics. So if OpenAI wants to, wants to pop from 50 to 70, you're thinking hard seltzer, right? Launch a hard seltzer. That would be the logical thing. It worked for Topo Chico.

• 38:34Jordi Hays?

  It's worked for many other.

• 38:35John Coogan?

  Why wouldn't it work for?

• 38:36Jordi Hays?

  Fantastic businesses.

• 38:38John Coogan?

  Just give everyone a hard seltzer. No, obviously stick to, stick to light beer. Let me tell you about CrowdStrike. Your business is AI. Their business is security. CrowdStrike secures AI and stops breaches. Was there anything else before we go into the housing apocalypse? There were some, there were some timeline posts you want to get to.

• 39:04Jordi Hays?

  Pull them up.

• 39:05John Coogan?

  You got, this is the best aura flip. You wanted to see this? Are you, are you on the timeline?

• 39:09Jordi Hays?

  My, uh.

• 39:10John Coogan?

  Computers having trouble?

• 39:11Jordi Hays?

  My computer is done.

• 39:15John Coogan?

  Oh, there's sound too?

• 39:16Jordi Hays?

  Ready for launch.

• 39:18John Coogan?

  Wow. Another person who dropped a nuke in Minecraft before Tyler dropped a nuke in Minecraft.

• 39:26Jordi Hays?

  Wow.

• 39:27John Coogan?

  Low skill.

• 39:27Jordi Hays?

  Can't say I'm, can't say I'm surprised.

• 39:29John Coogan?

  And then doing the kickflip is great. It's so funny that you can actually just mash these up.

• 39:36Jordi Hays?

  Can you imagine being 14 and seeing this?

• 39:39John Coogan?

  Amazing. Just absolute, absolute joy. Yeah. Here's Wyatt Walls. This is, this is what we're all about. I'm pivoting to something LLMs can't do, day drinking. 7,000 likes. Sean Frank is vague posting. We'll let you try and figure out who he's talking about. I have a friend, young, 30, nine figure exit. I've known him for years. Before he made it, before he knew what he was going to start, the one thing he always had, an unwavering belief that it was going to work out. He was willing to burn the boats over and over, always doubling down, always moving bigger and bigger. It's changed the way I want to operate. If you want to change your life, do it.

• 40:20John Coogan?

  If you want to win, then win. Don't let anything stop you. The only thing you have control over is your attitude and effort. I love some mindset posting.

• 40:27Jordi Hays?

  Fire me up.

• 40:28John Coogan?

  Got the thousand like bagger on the Sean Frank post. He's locked in and he's encouraging you to lock in. Anyway, Chinese streamers are creating content on a completely different level. We have taken our live stream efforts very seriously here at VPN. We have cameras that track us. We have Chirons and Stingers and all sorts of fun things. But it's clearly amateur, amateur hour over here because in China, they have taken things to unthinkable heights. And we'll show you this video and you can understand how different it really is. There are levels to this game.

• 41:10John Coogan?

  And we are playing it on Easy Move. This is a, he's a fairly large machinery that physically moves her chair with a seatbelt and spins her when chat donates a mere $7 USD apparently.

• 41:30Jordi Hays?

  So I think we should have a button that puts us into a racing simulator.

• 41:36John Coogan?

  Okay.

• 41:36Jordi Hays?

  And we can't go back to the show until we get a sub seven minute number ringtone.

• 41:41John Coogan?

  Okay. I like that. That's fun.

• 41:43Jordi Hays?

  And, and it should actually be a free button.

• 41:45John Coogan?

  Yeah.

• 41:46Jordi Hays?

  So anybody can hit it.

• 41:49John Coogan?

  I mean, I do think we should get this exact device and just put Tyler in it. And then if chat, every time we get a follower on X, for example, he could, he could be spun. It is, it is crazy, the level of interaction. The, the chat has, has fun with like, drink the diet coke with two hands every once in a while. But this is a completely different level of, of interaction. The gen, the generative UI stuff in, in chat GPT, we talked about it yesterday and got a chance to demo it. Much better experience with, with thing, the answers streaming in. Like I asked about, like, explain this whole SEC market manipulation thing.

• 42:34John Coogan?

  I fire off a big prompt and like, it gets me the answer very quickly. And then it's, and then it goes and explains the laws and then it builds some widgets about different items. And it's just a much, it's just a much better UI experience and product experience. And I'm excited to see other things people do with it. You can even get it to make cheese. Write a poem about cheese and message bubbles that look like Swiss cheese. It says, oh, cheese, my love, my golden delight. You make every cracker feel just right. From cheddar bold to brie so sweet. You turn a snack into a treat with hole, with little holes and dreams so big. I'd choose you over any fig.

• 43:13John Coogan?

  And if the moon were made of brie, I'd eat the stars and save some for the, it's a nice poem. But we're here to talk about user interface design. And it's funny that it can, you know, lay out those circles and, and yeah, the future of this is like, it can just draw any pixel at, at any frame, at any time for anything. So it can sort of generate video and graphics and games on the fly. And you will get your math, what was it? MMO? You wanted an MMO of something? I forget what it was. You wanted some explanation?

• 43:49Jordi Hays?

  I keep asking for games. I don't really play video games. But we gotta talk about, we gotta talk about Paul Graham.

• 43:54John Coogan?

  Okay.

• 43:55Jordi Hays?

  Paul Graham says, Amazon banning agents is the first opportunity I've seen since Amazon was founded for a startup to create an Amazon competitor. People will want agents to buy stuff for them. It will be one of the main use cases and they don't want to use some Amazon supplied agent to do it. Any business that bans agents represents an opportunity for a startup to create a competitor. If they need to ban agents, it must mean people want to use them or there would be no point. And that in turn means there's demand for a competitor that allows them. Your usage restrictions are my opportunity. It sounds, it sounds great. It sounds coherent, but Nan Yu says what you're probably thinking. I mean, they can just unban the agents.

• 44:40Jordi Hays?

  It's a single config file. So yeah, imagine you spent 30 years building an Amazon competitor, that the Amazon for agents. Spend 30 years, you spend, you've acquired millions of trucks, you employ more people than almost any other business on earth. And you're finally like, okay, like I'm finally, I'm finally ready to, to, to really, you know, eclipse Amazon. And Amazon's like, okay, we unban the agents.

• 45:06John Coogan?

  Yeah.

• 45:07Jordi Hays?

  So again, it's, it's the other, the other, the other pushback here from someone named David H. says, how lazy can we get? There's absolutely no value in an agent buying something on Amazon. It's just something people do to sound cool. I already have a human agent who buys way too much stuff on Amazon. Call my wife.

• 45:27John Coogan?

  It's the most, the most Gen Xer t-shirt from Venice Boardwalk I've ever seen. To really throw it in the old ball and chain there. It's ridiculous. Anyway, I think like, I'm not there yet.

• 45:48Jordi Hays?

  Well, cause I don't think it's an opportunity for startups to try to recreate the biggest online commerce platform in history. If anything, it's like an opportunity for Walmart, who is leaning, who is leaning more into agents.

• 46:03John Coogan?

  Yes.

• 46:04Jordi Hays?

  And I think we're going to see, does that actually turn the tides?

• 46:07John Coogan?

  Okay.

• 46:08Jordi Hays?

  Right?

• 46:09John Coogan?

  So are you long Sparky or Rufus? Cause Amazon has Rufus, their internal AI agent. Walmart has Sparky, their internal AI agent. Are you going Rufus mode or are you Sparky max?

• 46:23Jordi Hays?

  I mean, how hard is it to tell your preferred agent to just get on Rufus?

• 46:27John Coogan?

  That's what I'm saying. I think Rufus is going to go in the kennel and I'm going to have a kennel of agents. Rufus and Sparky will be in there. And then Astro 7.5 will tell them exactly what to do and they will go and do it because they will think it's me and they won't know. I think that's actually what's going to happen.

• 46:44Jordi Hays?

  You don't think, you don't think Rufus will be able to detect, figure out a bot detection?

• 46:49John Coogan?

  No.

• 46:50Jordi Hays?

  Ability?

• 46:51John Coogan?

  No.

• 46:52Jordi Hays?

  Like, cause it'll just be happening.

• 46:53John Coogan?

  Computer use and it'll just be, and I'll just be like, yeah, yeah. Okay. Codex, for the next five hours that I'm on the computer, just actually record all my mouse movements and like, create a program that actually mimics me, like learn my style of using the computer. Like, when do I alt-tab? When do I use the, you know, search? When do I type? How, how do I type? What type of spelling mistakes do I make when I type? Learn all that, memorize that, and then mimic my computer use pattern. So you're not like, right now it's like, it's like go straight there, right? But it will just be like, oh yeah, I'm just, I'm, I'm using the computer like I'm John. I'm writing like I'm John. I can, you know, it'll be close enough.

• 47:34John Coogan?

  And, and I think that people will wind up, they'll still have like their favorite front door to AI. And it might be chat GPT, it might be Claude, Gemini, whatever they like, whatever they wind up in. But then, but then, yeah, but then they might like, there are people that will have, oh yeah, I do some work on X and, and so I want to manage all my DMs. So like, I have Grokbot set up and I don't talk to Grokbot, but my agent talks to Grokbot. And then my agent goes over to Muse, because Muse has really good integration with Instagram. And if I try and go scrape Instagram, I'm, I am going to run into a bunch of problems, but Muse is happy to talk to me.

• 48:09Jordi Hays?

  Yeah.

• 48:10John Coogan?

  And so, especially with these, with these, these systems that operate over chat, it's like, it's going to be really, really hard to do bot detection if you're available over Telegram or WhatsApp, right? It's like, it's just text that's coming back or like, or we integrated with Slack. And so now I talk to it on Slack. It's like, you're telling me that it can tell what's, what's an AI prompt that comes over a Slack message that's 12 words? Go buy me a paper towel holder from the 1960s.

• 48:38Jordi Hays?

  Dark says the opportunity is to create a kennel for dog themed agents.

• 48:44John Coogan?

  Kennel AI. Now raising, yeah, Kennel SI. Okay. So should we go over to the mansion section? We are off tomorrow in some heartbreaking news for you all. So we gotta do some mansion set. We have to do it. We have to do it. We have to get to the mansion section. So we gotta talk about it today. The first home comes from a tech founder, the Shutterstock founder. Have you Shutterstock?

• 49:13Jordi Hays?

  Not a big Shutterstock customer.

• 49:15John Coogan?

  Shutterstock.

• 49:16Jordi Hays?

  But a wonderful, fantastic business.

• 49:19John Coogan?

  Yeah. Really cool business. And yeah, I remember it being really useful for finding stock photos, stock videos. Always a little more, little out of my price range for a while. Like you'd have to pay per image and I, I always liked the, the unsplash, the free versions or the cheaper versions, or maybe just go into Google Images and right-click. Yeah. Who knows? Jonathan Oringer is the founder. And his wife have listed a slopeside townhouse in the ski destination of Aspen, Colorado for $49 million. They bought the house for $25 million in 2021. They own the Kansas City Chiefs, from, from the guy who owns the Kansas City Chiefs. Sorry.

• 50:01John Coogan?

  They're listing the house because they want to expose their children to skiing around the world. They don't want to be in just Aspen. They want to be able to travel all over the place, but they did say they'll be back. Always be back. He founded Shutterstock in 2003. This summer, a $3.7 billion merger with Getty Images was called off. Interesting.

• 50:22Jordi Hays?

  Which again, I remember talking about that. It's just the most insane.

• 50:24John Coogan?

  Oh yeah. To block that.

• 50:26Jordi Hays?

  Government overreaching.

• 50:27John Coogan?

  So crazy.

• 50:28Jordi Hays?

  The most.

• 50:29John Coogan?

  So crazy.

• 50:30Jordi Hays?

  A category that is like, facing the most brutal competition that seemingly any sort of semi-modern technology company has ever faced. And still, no, you gotta go at it alone.

• 50:43John Coogan?

  Yeah.

• 50:45Jordi Hays?

  You gotta fight and survive on your own.

• 50:48John Coogan?

  Good luck.

• 50:49Jordi Hays?

  Good luck.

• 50:50John Coogan?

  Yeah. It's really, it's really drawn the shovel. It's brutal. Anyway, not, not a white pill for government regulation nailing the AI moment, but still have some optimism around here. Let's do a little tier list. Where's Aspen? In terms of vacation homes for you, Jordy, where are you putting Aspen? Is it in S tier, A tier, B tier, C tier, D tier? There's no E tier today. There's just F tier. Where's Aspen ranked?

• 51:20Jordi Hays?

  I'm going to be exposed here. I've never spent any time in Aspen.

• 51:23John Coogan?

  Okay.

• 51:23Jordi Hays?

  I've only spent time in Beaver Creek and Vale.

• 51:27John Coogan?

  Okay.

• 51:27Jordi Hays?

  Really comment, but I, but, but.

• 51:29John Coogan?

  I've actually, I've never been skiing there. I have been hiking there. It's beautiful. Let's put it in B tier since we're sort of neutral.

• 51:35Jordi Hays?

  No, it's obvious. It's obviously S tier for a certain, for a certain kind of person, right? You want, you want the access to the outdoors, but you want the glitz and the glam and the shopping and the restaurants and the sort of scene dynamic.

• 51:48John Coogan?

  Sure.

• 51:48Jordi Hays?

  And so.

• 51:49John Coogan?

  Yeah, Aspen ideas.

• 51:50Jordi Hays?

  There's very much, yeah, you can, you don't need to ask somebody where they spend their, you know, winter holiday, right? You know, based on.

• 52:01John Coogan?

  So we're going S tier with Aspen as a location?

• 52:03Jordi Hays?

  I think it's S tier.

• 52:04John Coogan?

  Okay. Okay. That's great. I love that. What about the fact that it was built in 2004? Is that too old or is that new enough? You get all the amenities. That's nice and fresh.

• 52:15Jordi Hays?

  We don't know how to build anymore.

• 52:19John Coogan?

  Okay.

• 52:19Jordi Hays?

  Like we did in 2000.

• 52:21John Coogan?

  In 2004?

• 52:22Jordi Hays?

  It was a wonderful, it was a wonderful vintage.

• 52:24John Coogan?

  Okay. 2000. So S tier again?

• 52:26Jordi Hays?

  A tier.

• 52:27John Coogan?

  A tier, A tier for 2004 build. 6,600 square feet of Aspen townhouse. Is that enough for the townhouse in Aspen?

• 52:39Jordi Hays?

  I mean, it's humble, but this is a humble group, right? They don't, they don't want their children to just grow up.

• 52:45John Coogan?

  Yeah.

• 52:45Jordi Hays?

  You know, only.

• 52:47John Coogan?

  Yeah.

• 52:47Jordi Hays?

  You know, being in the bubble of Aspen. They want their.

• 52:49John Coogan?

  He probably walks around the town and they're like, oh, what do you, what do you do? He's like, I got a website, you know?

• 52:53Jordi Hays?

  Yeah.

• 52:54John Coogan?

  Yeah. So, so it's A tier?

• 52:58Jordi Hays?

  A, yeah, A tier.

• 52:59John Coogan?

  A tier. Okay. A tier. Let's go. It's being sold furnished. What do you think of fully furnished home sales? Is that a good feature or is that just a problem you got to deal with? You got to unwind all their decisions?

• 53:12Jordi Hays?

  Depends on, depends on.

• 53:13John Coogan?

  Well, take a look at the photos and tell me, given this furnishing, I feel like if you're going to Aspen, you're not going to be there constantly. You want to show up and it's turnkey.

• 53:21Jordi Hays?

  Before I'm not, I don't want to sit here and, and judge his taste. I don't want to, I don't want to place judgment on his furniture selection.

• 53:31John Coogan?

  That's the name of the show, dude. You gotta do it.

• 53:36Jordi Hays?

  Gun to my head. Do you like the, do you like the interior design?

• 53:41John Coogan?

  No, no, no, no, no. I'm saying in the abstract, as you are shopping and you see it comes fully furnished, is that a good thing or not generally? Generally, not with this one. You, you want to buy bare bones usually.

• 53:54Jordi Hays?

  Yeah, absolutely.

• 53:55John Coogan?

  Okay. Let's put that in D tier.

• 53:57Jordi Hays?

  Yeah.

• 53:57John Coogan?

  Yeah. It's not, and that's not a judgment on this particular house or this, these furnishings. Okay. What else we got?

• 54:04Jordi Hays?

  The thing I love most about this house is 2.6 is pointing out no infinity pool.

• 54:10John Coogan?

  And the, and the yard. No infinity pool.

• 54:13Jordi Hays?

  The yard is seemingly relatively small.

• 54:18John Coogan?

  Okay.

• 54:19Jordi Hays?

  But there's, they seem to be surrounded by wonderful trees and, and it looks to be a very nice neighborhood.

• 54:28John Coogan?

  Okay. Okay.

• 54:29Jordi Hays?

  So I'm just really glad there's not like a concrete slab within an infinity pool.

• 54:34John Coogan?

  Okay. There's one last thing to debate. There's construction at the Aspen, Pittkin County Airport. And there's been speculation that this could hurt the real estate market. Now Shane, the agent here, says that he thinks the impact will be minimal. He says, it's not a concern of mine. So.

• 54:54Jordi Hays?

  Aren't they, aren't they upgrading the airport to make it easier to fly in and out?

• 54:59John Coogan?

  Yeah.

• 54:59Jordi Hays?

  During heavier conditions. So there's going to be like minimal disruption and then.

• 55:05John Coogan?

  And then a benefit. So where are we putting that on the tier list? Airport construction nearby?

• 55:10Jordi Hays?

  Local airport upgrade.

• 55:11John Coogan?

  Airport, upgraded airport. It's an amenity.

• 55:13Jordi Hays?

  Yes. It's a feature, not a bug. S tier.

• 55:16John Coogan?

  S tier. Okay. I think we got, I think we got a fantastic, I think we got a fantastic review here. So go check it out if you're in the market. Anyway, our next guests are already here, ready to come in. But first, let me tell you about public.com. Investing. Invest across all asset classes.

• 55:35Jordi Hays?

  Let's give it up.

• 55:35John Coogan?

  Automate anything with AI agents. Run trading strategies, risk management, money movements, and monitor markets with AI agents for investing on public. And let's bring in.

• 55:44Jordi Hays?

  Our next guest.

• 55:45John Coogan?

  Nano and.

• 55:46Jordi Hays?

  Incubated a new play.

• 55:48John Coogan?

  Oh, yeah. But there's also some trash funds. So let's bring them in.

• 55:51Jordi Hays?

  We got a lot going.

• 55:52John Coogan?

  Get that going. Ready. You already hit it once today, Jordy, but I think we might have to hit it again. How are you both doing? Thank you so much for taking the time to join the show.

• 56:02Speaker 02

  Thanks for having us.

• 56:04Michael Mignano?

  Thanks for having us.

• 56:05John Coogan?

  Not much. We already warmed.

• 56:06Jordi Hays?

  Michael, I gotta say, you look, you got like a new look going or something. It's fantastic. I don't know what it is. The flow is working. You got a kind of a summer glow.

• 56:17Michael Mignano?

  Summer, the summer vibe, it fades slowly. You know what I mean? I'm just trying to, I'm just trying to keep it going as long as possible. It's like 75 and beautiful here in New York City today.

• 56:27John Coogan?

  Lucky.

• 56:27Michael Mignano?

  Once the weather turns, you know, have, have us back on, I'll probably look absolutely miserable, but right now feeling good.

• 56:33Jordi Hays?

  Well, it's a, almost a hundred degrees here in LA and I'm wearing a puffer jacket in the studio. A lot of people are asking questions, but it's a nice jacket. So.

• 56:42John Coogan?

  Yeah.

• 56:43Jordi Hays?

  But anyways, fantastic to have you guys on, on, on this, you know, monumental day for the firm. So yeah, break it down. What's going, what's going on?

• 56:52Speaker 02

  Um, it's a big day. We announced our new set of funds. We raised $900 million, which is the largest fund cycle in the USV's history. We.

• 57:08John Coogan?

  Let's get a replay on that. I want to see that again.

• 57:10Jordi Hays?

  Hold up the replay.

• 57:12John Coogan?

  Hold up the replay.

• 57:12Jordi Hays?

  Sorry to interrupt, but let's, let's watch that back and then we'll continue.

• 57:17John Coogan?

  Oh, we don't have it. Oh, okay.

• 57:18Jordi Hays?

  Oh, no replay, no replay today.

• 57:20John Coogan?

  But no replay today. Sorry.

• 57:21Jordi Hays?

  Oh, man.

• 57:21John Coogan?

  Continue. What's the plan? Well, is anything changing or is it just an expansion of the same strategy?

• 57:28Speaker 02

  Um, it's exciting because a bunch is changing and a bunch is staying the same. Um, the market has rapidly evolved around us. Rounds are bigger. You might've heard. Um, things are moving quickly. Opportunities are really, really large. We have some awesome new members of our team, um, like Mike. Um, but the idea driven focused investing that we've always done, we will continue. Uh, we'll just do it with more firepower and able to lean into the things we're excited about in a bigger way.

• 58:00John Coogan?

  Yeah. How are LPs responding to the idea that companies are staying, are staying private longer? I mean, the, the, the revenues that are out there from 70 billion, 50 billion, 20 billion, like we've never seen these before. They're, they are getting out into the public markets, but there's just a new level of size that can happen in the private markets. And I think that changes the underwriting. But how are LPs thinking about the trade off between just the scale and the actual timelines?

• 58:29Michael Mignano?

  Yeah. I think, I think LPs understand that, you know, much like Rebecca said, the game on the field is, is changing, not just in terms of the scale of capital raise or the scale of ambition, but the scope and the shape of these companies, you know, a lot of the things that we're investing in here at USV simply just require more capital and they require more time. Uh, you know, Rebecca, um, as an example, has been investing in robotics now for years here at USV, which just requires significantly more capital, uh, in the physical world than pure software does. Um, you know, in 2021, USV launched an energy fund that has been investing in nuclear and new means of battery

• 59:11Michael Mignano?

  production and storage. And same thing, those companies need more capital. They need more time to bake. So I think our LPs look at it as a continuum and I think they see that the opportunity is bigger than ever before.

• 59:24John Coogan?

  Has the rise of the, the Decacorn acquisition changed your strategy or maybe conversations with LPs? It's just, we've had what Grok and Open Router and there's Hugging Face. There's just been so many transactions that were pre, in the previous era, it was like WhatsApp and really nothing else. And now it feels like there are a number of buyers that can take a, take down a 10 or $15 billion acqui, acquisition. And that just feels like it changes the math, but how are you actually grappling with that new normal?

• 1:00:01Speaker 02

  Yeah. I mean, it, our job, right, is to think about what that upside could be. If things go right, what does this wind up looking like?

• 1:00:10John Coogan?

  Yeah.

• 1:00:10Speaker 02

  Um, and the, when you play that out and when you think about what things going right looks like, the highs are higher, right? And there's proof points in the market to support that. And so when we think about making investment and say, do we think this can return our fund? Maybe, do we think this can multiply our fund? Uh, the evidence out there to support that being possible when you go after the big ideas is stronger than it's ever been. And so as we modeled out what we wanted to do, I think it warrants a different kind of capital base.

• 1:00:41John Coogan?

  Yeah.

• 1:00:41Michael Mignano?

  I also think that, you know, being small is kind of what, or smaller relative to the rest of the market, right? We raised 900 million, which is large for us, but it's smaller than lots of other big sort of mega funds that are out there today. And being, being smaller kind of enables us to have a very, very interesting return profile, right? At a, at a $900 million total fund size, we can return very, very meaningful funds with companies that exit in the single digit billion dollar valuations. But in the history of USV, there have been companies that have reached, you know, 50 billion evaluation and 100 billion evaluation. And when we've had those, they've returned some of the greatest performances in, in venture history. So that's

• 1:01:24Michael Mignano?

  why we really like the strategy of having the capital to play the game in the field today while also staying smaller.

• 1:01:30John Coogan?

  Yeah.

• 1:01:31Jordi Hays?

  How is the firm reflected on just how good the venture industry had it, call it 15 years ago, when you could, you know, go, you know, buy 25% of a company with like the most talent dense team for a million bucks? Whereas today, for today, that same quality of team, they're coming at you and they're like, look, I really want to work with you, but you, you know, you got to put together at least 30 million for me on, on 120 post if we're, if we're going to do this, just because that can often be market for a super talent dense team getting off the ground.

• 1:02:07Speaker 02

  Yeah, look, it would be nice to be able to buy pieces of the companies we're most excited about for what we could a decade ago, but you cannot like elements of the market, but you're not going to change elements of the market. And so I think our attitude towards that has been take the game on the field, think about what we want to do and where we excel, which is this really idea-driven focused investing and model of fun that allows us to do exactly that with the market conditions of today, because we can be nostalgic about it, but we're not going to get back there. We don't think it's going back there anytime soon.

• 1:02:45Jordi Hays?

  Totally. Yeah, why would it? Trends in New York specifically, like how are you seeing talent flows? We've seen a bunch of amazing companies start and stay in New York primarily, even if they do set up maybe an SF office at some point. But what kind of conversations are you guys having with entrepreneurs that are based there that are kind of early in making those decisions around where are we really going to be based?

• 1:03:12Michael Mignano?

  I think one of the cool things about New York is because it's maybe not as at the epicenter of AI right now, companies can actually build here to a lot of strategic benefit. As an example, one of our portfolio companies, Suno, they have offices in San Francisco, they have offices in Boston, but their biggest office is actually becoming New York City, because it's strategically advantageous to maybe build around the market there and attract talent that is interested in consumer and other sort of like non-pure enterprise or infra areas. And so I think New York City offers a ton of advantages. Obviously, we've probably talked about them on here a million times, like the intersection

• 1:03:54Michael Mignano?

  of many different industries, but we're seeing a ton of companies both in San Francisco and New York as well. And so there's plenty of opportunity here. What do you think, Rebecca?

• 1:04:04Speaker 02

  Yeah, I mean, I also think USV was really started at this moment where an infrastructure moment was transitioning to a deployment and application moment. And in those moments, talent tends to diversify and opportunities tend to diversify on where they're located. And you saw companies grow in different places. We think we're in a similar moment right now where we've been in this kind of massive infrastructure build and you're starting to see this deployment and application era happen, which gets us really, really excited and something we're spending a lot of time leaning into. And so our guess on that and what we're starting to see is those applications are built in many different places. That being

• 1:04:47Speaker 02

  said, like, our job is to invest in a relatively small number of opportunities that we think are dead on on theses we're excited about by the best people, and we're going to be where those teams are. And so we love the New York ecosystem, and some of the companies are going to be here, and many of them will not.

• 1:05:04John Coogan?

  How do you think the skill sets of founders who are the best possible fit for USV partnership is changing? It feels like there's, you can be even more technical, like some of the founding teams are like academics for like 20 years and like PhD published, and then they go and they start a great company. There's also people who like almost look like real estate dealmakers, and then they're opening up a Neo cloud and they're doing really well. There's people that are just great at creating these talent vortex. It feels like we're at a very diverse time of entrepreneurial talent, but like, how are you grappling with it? Who do you attract to most across like they have a brilliant

• 1:05:49John Coogan?

  idea, or they're great at product, or you know that they're going to be able to marshal all the pieces to really scale quickly? Like, what is your philosophy around the type of partnership that you're looking for?

• 1:06:01Michael Mignano?

  Yeah, so I think USV has always been very product-centric. When I was a founder building in New York, I knew that about USV. USV really projected that. And then when I joined six months ago, I learned very quickly that all the partners here, all the team here, they really have to fall in love with the product. And obviously, like, that doesn't necessarily always apply to being able to use it like a micro nuclear reactor. But in general, I would say we're all very oriented around products and loving the things that are getting built. I think that remains true to this day. However, as we all know, as a result of AI, it's getting easier and easier and easier to make a good product, right? AI is just lowering the barrier. And so I think one thing that we've all been

• 1:06:45Michael Mignano?

  talking about internally is you can make a great product, but it's still really, really hard to win. And so I think we're thinking about what are the qualities that founders need to have to be great at go-to-market and breaking out from the pack and telling the story. And also, maybe obviously, raise capital. In this market, it's definitely becoming a little bit of a game of the haves and have-nots. It's potentially easier than ever to kind of outraise your opponent and sort of suck the oxygen out of the room. And so one thing we think about when we see founders who are building great products and telling great stories is, is this founder going to be able to raise a lot of capital? Because it's going to be expensive to win, and that's going to matter a lot.

• 1:07:28Speaker 02

  Yeah, I think we're at this time where like, I think we're at this time where like four things really matter, where you need depth of perspective and experience in something that other people don't see the same way that you do. You need to be an absolute talent magnet at probably the hardest time ever to hire a great team. You need to be faster than everyone else, and you need to be so good at telling a story that you win the market before it's obvious. And I think we are looking for the teams that can kind of nail those four things.

• 1:07:57Jordi Hays?

  Totally. Mourning the era of the earnest hacker who could just make the beautiful product with a couple other people and win. It feels like we're past that. As a firm that's historically been so thesis-driven, how do you think about the right time to actually share those ideas and try to become and use them to sort of bring in the right opportunities and teams and start those conversations versus when you want to keep something like effectively quiet? Because if you guys put something out now, you know that all of your, we're in a pretty positive some industry, but your competitors will

• 1:08:39Jordi Hays?

  read that and be like, oh, that's interesting. Like, I'll go try to give a bunch of money to teams in this category as well. And sometimes you want to let something kind of cook for a little.

• 1:08:49Michael Mignano?

  One of the cool things about USV is that I've learned in being here is nobody's precious about the ideas, right? We're constantly having conversations, we're constantly trying to imagine what the future looks like, but we don't keep them like closely guarded secrets. In fact, we kind of try to put them out into the world as early as possible so we can learn. Those of you who follow us on X, like, we're constantly putting out frankly, half-baked ideas, things that probably haven't really been fully thought through yet, because we feel like by doing that, we actually get to learn. And not only do we do that through putting our thoughts out through writing or X, but we also do this through investment.

• 1:09:32Michael Mignano?

  We're willing to bet on ideas that seem pretty out there, pretty sci-fi, early on in the journey, because historically, that's actually how we've made a lot of money. But again, we also get smarter by doing this. A great example of this is a few years ago, USV led the seed in Doctronic, who I believe has been on the show somewhat recently. I remember from the outside in seeing USV make that investment. I wasn't at the firm yet and thinking to myself, wow, this is pretty sci-fi. This is a company that's trying to put a doctor in my pocket. They're saying they're going to literally be prescribing medicine from AI in a couple of years. And sure enough, they're doing that now, and it almost seems obvious, right? But I think the way that USV was able to do that was by putting their

• 1:10:16Michael Mignano?

  ideas out there into the world, learning from others, and being willing to test the really crazy ideas. I mean, Rebecca, like, you've been doing that here for nearly 10 years. Like, how have you all done that?

• 1:10:27Speaker 02

  I mean, I think the Kool-Aid of USV that I've drank so strongly is that gatekeeping ideas is a totally losing game. That the benefit we get from putting ideas into the world, pressure testing them in public, getting all that feedback, having people tell us we're dead wrong and dead right, and having that conversation in public, and the people that then come out of the board work to say, you have to meet this team that's working on it or this adjacent thing, is so, so, so much more valuable than any kind of benefit you would get from holding things close, that we are huge believers in public thinking

• 1:11:08Speaker 02

  and the benefit of also spurring activity through the public thinking.

• 1:11:13Jordi Hays?

  Makes total sense. How are you thinking about, as we've seen these sort of mathematical breakthroughs, and we've talked about this on the show a bunch, math is cool because you can sort of like deliver solutions or partial solutions to all these open problems, but there's sort of an incentive to do that just because it's pushing humanity's knowledge forward, and there's not always like a real-time commercial application of this sort of like new knowledge. At the same time, you have to be betting that these same models, which will be in the hands of the public, hopefully soon, are going to allow people to have breakthroughs in like tons and tons of different fields. And the labs can't possibly monetize every

• 1:11:58Jordi Hays?

  discovery. And to me, that says like, we could have like a mini scientific renaissance like over the next 12 months and create this incredible opportunity for small teams to like get access to these models, push them, and again, have these breakthroughs, and then be in the position to sort of race to commercialize them, develop IP around them, et cetera. Is that something that feels top of mind for you guys?

• 1:12:25Michael Mignano?

  Absolutely. You know, I think one thing we like to do is we like to imagine what the world looks like at some point in the future. Just to use an example, robotics, we think a lot about the physical world and physical intelligence and not the, not the digital labor that will be, you know, replaced by intelligence in some way, but the physical labor that will be augmented by physical intelligence, you know, farming, construction, things like this. So we imagine that point in the future and then, you know, we look at a technology today and we try to imagine what the slope of that technology has to be to catch up to that future we imagine. And then it's about finding the team that we think can both make the technical breakthrough to make that slope actually possible and

• 1:13:10Michael Mignano?

  who's also commercial and commercial enough to sell the idea and sell the vision. Again, for all the reasons we talked about, hiring people, raising capital, eventually selling to customers. And, you know, an idea like that is what led us to back Generalist recently, who again, I think also has been on the show recently. So, you know, we're very much into the idea of backing technologies at their nascent stage as long as we can imagine the future that they will ultimately deliver to.

• 1:13:35John Coogan?

  How are you thinking about incubations these days? It feels like you have enough capital to get a serious foothold in those rounds that start later and are bigger and you need the capital. So you're set up for success there.

• 1:13:49Jordi Hays?

  You're like, if you give Mike a long weekend, you're going to end up with a new incubation.

• 1:13:53John Coogan?

  Yeah. It's true.

• 1:13:55Jordi Hays?

  There's one coming up. There's one coming up this weekend.

• 1:13:58John Coogan?

  But what's the, yeah, but what is the over, is there an overarching thesis? Is there a very opportunistic, like what, what is the correct pattern? Like, what can you tell us about how the firm is thinking about incubations across this fund?

• 1:14:09Michael Mignano?

  Rebecca, you want me to take this one or?

• 1:14:12John Coogan?

  Yeah, yeah, go for it.

• 1:14:13Michael Mignano?

  So, um, yeah, I think, I think what you're referring to, Jordy, is, is Supertake, which is a company that launched out of USV, uh, not even two weeks ago. Supertake. Oh, wow, I like that one.

• 1:14:24John Coogan?

  Dramatic.

• 1:14:25Michael Mignano?

  Supertake is a product that lets anyone express an idea or an insight they have about the world and, uh, an agent, a frontier agent will go and build an investable portfolio for them. It will invest in it automatically. And then in real time, it will be rebalancing it for them to achieve their goals, whatever they are for that portfolio. And where this came out of was actually our thesis work that's been going on for much of the year around what we call obliterate, don't automate, and the idea of agents, not just automating existing markets and automating existing workflows, but actually reshaping those markets completely. We've made bets across healthcare as an example. We talked about robotics and we think personal

• 1:15:07Michael Mignano?

  finance is also a place where this is going to happen. Many of us in the world, we use financial advisors or we invest in ETFs, or some of us even YOLO into individual stock picking, but we do it without the, oftentimes without the knowledge or the expertise or the fundamentals of what is going to make an investment good or great. And we think that's something that AI can help people with. So why shouldn't everyone in the world have a personal agent working on their, on their behalf? We went out to find this company. We met with, you know, every company we could that hopefully we thought might be doing this and we didn't find anyone doing it. And we said, you know what? It's gotten easy enough to build products, then maybe we should just go and build this ourselves. And so,

• 1:15:49Michael Mignano?

  as Jordy, as you mentioned, we built Supertake. You know, we're hiring, uh, leaders to put, you know, around the company right now. And, you know, to speak to, I think, the bigger question, John, about incubations, I think we don't really necessarily think them about as incubations. We think of them as kind of bets on inception stage companies and, and people, right? If there's a person in our network that has a great idea, you know, we should give them the capital that they need to go explore that idea. And if we have an idea that no one is yet exploring, let's go find the person and match them with the capital to go explore that idea. And again, AI, this is, this is the theme among the whole conversation today. AI is making it much, much easier to do that.

• 1:16:29John Coogan?

  Cool. Well, thank you so much for coming on the show. Have a great rest of your day. Congratulations.

• 1:16:34Jordi Hays?

  When they go high, you guys go higher, but stick to your guns.

• 1:16:38Michael Mignano?

  But still low. Still a little bit low.

• 1:16:40Jordi Hays?

  When they go high, we, we, yeah, yeah, yeah. Awesome stuff.

• 1:16:45John Coogan?

  Rest of your day. We'll talk to you soon. Thanks, guys. Goodbye. Let me tell you about Figma. Agents, meet the canvas. Your AI agents can now create and modify your Figma files with Design System contact. We got Nathan back on the show from Air Street Capital here to break down the state of AI report. Nathan, how you doing?

• 1:17:06Jordi Hays?

  Finally get to the bottom of this whole AI thing.

• 1:17:07John Coogan?

  Do you think there's anything here? Like, I've been hearing about the AI, AI, super AI, super intelligence, like, is there, there, there?

• 1:17:16Speaker 05

  It's everywhere.

• 1:17:18John Coogan?

  It's everywhere.

• 1:17:19Speaker 05

  I, I, I don't know where to look and not see AI nowadays. I mean, I'm in, I'm in a stuff at the moment and you can't get around it.

• 1:17:25John Coogan?

  Yeah, it's crazy. So how do you, I mean, obviously there's the, there's the, you know, infinity takes, there's the, it's a zero take. You're trying to find something that's more moderate, more realistic, more grounded in reality. Uh, what is your process for making sense of all the chaos and all the numbers that are flowing out, all the rumors? Uh, how, how do you think about this market right now? What's your, what's your, what's your philosophy?

• 1:17:51Speaker 05

  Yeah, yeah. Well, the philosophy was starting, actually, capital about 10 years ago was really to find opportunities to invest in AI where you could really invent new product experiences, solve problems that you couldn't solve before. As a function of all that work, as you said, like I get to talk to people in policy, research, industry, uh, the safety community, et cetera. So I'm hearing all these different voices and opinions and I'm reading, you know, what's, what the media is reporting and then you're talking to people who are actually building these things. And so like about 10 years ago, I thought like it would be increasingly beneficial for the public to get access to a kind of document that was balanced, just as you said, is very research driven and, you know, has some cheeky

• 1:18:33Speaker 05

  opinions in there because no one wants to read a boring consultant report. Um, and I need to publish this on an annual basis in a way that's, uh, you know, hopefully unbiased and, uh, and open. So, I mean, my take of the current market is really like, just looking back 10 years ago, I, I still think what we have today is like truly magical. I don't think anybody in the AI community would have ever expected it to happen this fast, that you have this like magical tool you can do increasingly anything you want with. And it's just so damn empowering. I think there, there can't be like a more exciting time to be alive, like even though we're balancing it with all these like emergent risks and issues that we get into in the report as well.

• 1:19:10Jordi Hays?

  But is that true though? Because I feel like some folks like predicted this almost perfectly and now.

• 1:19:15John Coogan?

  Some people were like, it's going to happen in 2004 and we're all going to be dead. Like that was the other thing. But yes, in general consensus in the AI community was like, this is going to be recommendation systems for a long time.

• 1:19:26Speaker 05

  Yes. When I say predict, I'm talking about people back in 2010. So like the OG, like Alex and that like first wave of learning out the people who started predicting two years ago and just kind of, you know, I'm not saying it's a bad prediction. I mean, it's fair that, you know, some people, I can't imagine how you can extend a line and remember all those memes about, look, my child is five months old. Like, you know, 10 years is going to be like the size of the planet.

• 1:19:49John Coogan?

  Christian Kyle, one of the greatest, most viral posts ever. It's a great one.

• 1:19:54Speaker 05

  Yeah.

• 1:19:55John Coogan?

  Um, give me your cheekiest take. You said you mentioned cheeky takes.

• 1:20:01Speaker 05

  Yeah, yeah, yeah. Also the, so you've been seeing, um, uh, like companies just becoming inference businesses. It's like, doesn't matter if you're like a Neo cloud or, or an inference cloud or like an app or whatever.

• 1:20:15John Coogan?

  So this is the, this is the Neo lab to Neo cloud pivot that's sort of happening below the surface, uh, sort of throughout the start of this business.

• 1:20:23Speaker 05

  So I think you could, you can meme it by saying, you either die getting to the frontier or you live long enough to serve inference.

• 1:20:31John Coogan?

  Sure, sure. Yeah.

• 1:20:32Speaker 05

  And you can see like companies that have tried to build frontier models and have failed have eventually like pivoted towards building huge data center businesses to serve Chinese models, for example.

• 1:20:42John Coogan?

  Okay. So not, I, I mean SpaceX is like probably the most prominent example of, you know, probably making more money from selling access to their data centers. But that's where the unique capability is, especially when you think about the space thesis. Um, but, uh, but you're seeing this up and down the stack with companies as small as $100 million raised or?

• 1:21:03Jordi Hays?

  Yeah, with the, with the, you know, some of these inference businesses, you know, I was talking to someone last night and they were saying, you know, running with horrible margins or negative gross margins, you know, there's been some examples where it didn't work, but you know, they, they brought up, you know, Uber as an example where it clearly was the right decision to optimize for market share. The question, the, the, the big thing is that Uber was competing for what, what was, what ultimately now is effectively a monopoly or duopoly at best, uh, but, but still very dominant. And, and my question with these inference businesses, which honestly, they're all effectively in market right now, raising massive up rounds. There's a lot of demand. They're, they're oversubscribed

• 1:21:48Jordi Hays?

  because the growth is so intense. But my question is like, when, when, when and where will margins normalize? And are investors, how are investors going to process businesses that could actually in their end state end up with these like very, very, very slim margins that we just haven't seen? We didn't see it in cloud. We've never seen it in, in software and they could look more like, you know, energy, you know, utilities over time, which could still be big businesses. But, um, I don't, a lot of these businesses are not being priced that way yet. And eventually they're going to have to, to have, find the sort of like steady state.

• 1:22:29Speaker 05

  Yeah, yeah, I think these are all, these are all important questions. I mean, the numbers are astonishing. You know, hyperscale is spending, you know, seven hundred and something billion dollars a year and potentially doubling like year on year. Like NeoCloud's also ripping to billions of contracted revenue and, you know, gigawatts of compute. And so I, I think again, what I liked with the state of the airport is like you get to kind of go back in time and see what the world was back then and just like contemplate some of the questions we ask ourselves today and consider if we even asked those questions a couple of years ago. I think it was only really like a GPT three or so that the world was still considering that compute was important for training. And we didn't really talk very much about the need for inference at all.

• 1:23:15Speaker 05

  Including the fact that some of the biggest inference companies today were not born as inference companies. So that's another sign that, you know, they didn't foresee like the demand. So I, I think it's all just getting back to this point of like, we have incredibly powerful technology, just like ninety nine percent of the world doesn't know how to use it because the one percent that built it like is not very good at educating the ninety nine percent about how to use their black box. So I would love there to be a sort of like genius bar for AI. I think like OpenAI should open a pop up or Anthropic should open a pop up. To just get people.

• 1:23:47John Coogan?

  Charleston AI, there's someone doing this in Charleston. They're onboarding personally, yeah. The strip mall, basically. Yeah, Geek Squad. No, it makes sense. How have you been processing that chart that's been going around that shows the share of compute allocated to pre-training, RL and inference? And inference sort of remains thirty ish percent across the sample size. But pre-training drops from like fifty percent of GPU utilization to like ten percent. And then you just watch RL like grow, grow, grow. There's a bunch of ways to read into that, but what's your interpretation?

• 1:24:25Speaker 05

  Yeah, I mean, mine is that the, the last like, you know, four or five years or so has been trying to figure out what the recipe is. Uh, I E like I'm trying to, you know, do pre-training, what is the best like data mixture? What are the best like, you know, ingredients to this whole, to this whole magical soup? And then over the years, like we figured out how to do that better. And so it's, it strikes me as normal that one would end up spending less money on exploratory work because the solution is more like in, in the, in the plain eye.

• 1:24:56Speaker 05

  And then the whole pitch with RL is really that, and then DeepMind showed this with their first like Atari games, you know, ten years ago, which is one of the most magical moments, I think, in AI at the time. And it's this idea that like, what, what we have as solutions today are really like local maxima that were discovered through human ingenuity and sharing through reading and whatnot. But like, that doesn't necessarily mean it is the global maxima. And you can get a computer to explore the search space for as long as you want. And for as long as you want equals how much money you want to spend. And that amount of money you want to spend is really contingent on what like you're trying to use it for. And so if your, if your problem is like super hard and really valuable, if you crack it, now we're in this point of

• 1:25:40Speaker 05

  well, I want the solution bad enough. I'm willing to spend a shit ton of money on RL to try to hill climb to get there. So I, I think it's like the, the natural like progression. There probably is something to read into the fact that like, you know, we've mined a lot of the pre-training data that's out there. And, you know, there are reports that, you know, certain frontier models are getting better, not necessarily by adding more pre-trained data, but by removing like shitty data. So we're getting better at curation. Which, which I think intuitively also makes sense. Like there are schools with like crappy curricula and schools with really good curricula and good teachers. And you can imagine, you know, which one a student would perform better in. So I think it's black magic into recipes and with recipes comes more efficiency.

• 1:26:25Jordi Hays?

  Is, uh, is ARR the best metric that we have? It gets so much criticism right now, but when, when everything is going up, annualized run rate is just, is I think the best proxy for demand and, and and scale of these businesses and, and create some normalcy. I think like half of people on X still think that ARR can only stand for annual recurring revenue. But, but as far as like annualized run rate, uh, as a proxy for demand, I don't know that we can have anything better. And so I think that the criticism of it is like overblown in many ways.

• 1:27:05Speaker 05

  Yeah, yeah. I mean, it's, it's, it's a bit gamey and especially annoying. But I, I think the, the, the best metric is like, I heard this from one of our portfolio companies where they say, you know, our, our customer, like thirty percent of our new customers sign contracts and in like three months, they come back to add more token spend than their entire annual contract. Was four. Um, so you're like, if, if people are like coming back for more and there's value, whether you express that as like AR, whatever the Rs are, I don't, I don't know, but I think you got to get into the substance of the matter. And the problem is like so much charading nowadays because that, you know, if you talk to every VC, they'll tell you this game is basically memetic. And so everybody wants to play into this. Into this, this pantomime and that's not particularly helpful.

• 1:27:49Jordi Hays?

  The interesting thing is like e-com, e-com bros are actually, uh, they have like the sort of a pretty strong BS detector here because that, that, uh, you know, that category is an industry is so seasonal that if any e-com bro tells you their like run rate in Q four, you can assume that their actual business is much smaller, right? Because they're going to be peaking in.

• 1:28:11John Coogan?

  Oh, yeah, yeah.

• 1:28:12Jordi Hays?

  If they're like, at all, you know, maybe, maybe health is maybe a category that, that's a bit different here. But AI so far is like moderately seasonal as in there's like a lot of demand. Maybe less demand in August than, than, than other months and maybe like December is a bit slower because you have, you know, the holidays.

• 1:28:33Speaker 05

  Yeah.

• 1:28:34Jordi Hays?

  Of course.

• 1:28:34Speaker 05

  Yeah. We did see, uh, we did see though that like within, in a cohort of AI first companies versus like SaaS companies that threw on some AI. The top quartile of the AI ones was three times faster revenue.

• 1:28:47John Coogan?

  Whoa.

• 1:28:47Speaker 05

  Growth in between the like one and twenty million dollar bucket.

• 1:28:50John Coogan?

  Interesting.

• 1:28:52Speaker 05

  And twenty million plus bucket was, I think, like a hundred percent faster. So I, I think the substance, the substance is there. You just have to like dig beneath the surface.

• 1:29:02John Coogan?

  On that memetic question, like how important is uh, understanding just the depth of the financial markets, the behavior of financial markets now to predicting AI progress versus say, uh, previous eras where it was more relevant to understand algorithmic progress or even like the, the, the, the compute that was coming online in the near term, like, okay, Blackwell's here, hundred thousand GPU clusters are here. We can expect this X, Y, and Z. Now it feels like the bigger discussion is like, is like, will, will ten trillion dollars show up from the capital markets or not? And it's almost a different type of question or exercise.

• 1:29:41Speaker 05

  Yeah, absolutely. And I think that's why people are referring to Nvidia as like the central bank of AI. Which I think is a great, another great meme. Yeah, like I think the, uh, the bipolar nature of, of like the, the media around financial markets, I find very frustrating because it, it really was the case like during the first six months of this year where it's like for three weeks, AI is terrible. It's dead. It's shit. It's not going to work. And then, uh, and then three weeks later, it's like, AI is so back. It's amazing. It's working. And you were just like gyrating between these two poles like every, every other week. And, um, and meanwhile, like for everybody who's using this stuff, you can see continual progress and utility.

• 1:30:23Speaker 05

  So I think, at least from my conversations with folks in like Neo Labs and, um, and hyperscalers and NeoClouds, it's really like the build out is limited by capital. Like we know how to do it. The ships are available. We have issues around powered land. Construction and permitting. And, uh, and we see those issues just getting worse. In fact, that was a prediction we had last year in the state of the airport that like NIMBYism would basically come to the fore and like start being really influential in midterms. Which we'll see, I guess, in a couple of weeks.

• 1:30:57John Coogan?

  We don't need to see, we know, we know you got that one dialed.

• 1:31:00Speaker 05

  Yeah, it's not, it's not great. Um, and so, and so it's really like, um, progress is very limited by capital because like we're now in the like financialization stage of, of AI. Like we understand the recipes as we talked about. The demand is there. We just need to deliver it, um, in, in more efficient ways and get more people understand how to get value from it.

• 1:31:21John Coogan?

  Very cool. Well, thank you so much for taking the time and breaking it down for us.

• 1:31:24Jordi Hays?

  Next time you call in, call in from Europe. We need the, the Europe update.

• 1:31:29John Coogan?

  We do, we do.

• 1:31:30Jordi Hays?

  Overdue.

• 1:31:30Speaker 05

  Sounds good. A pleasure.

• 1:31:32John Coogan?

  Have a good one. We'll talk to you 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. We have two guests calling in soon. Get that gong ready. Oh, you're getting two gong mallets. Okay. We got Healy Cypher, good buddy of mine, coming back on the show. Welcome to TVBN. How are you guys doing?

• 1:31:57Speaker 06

  We're great. Good to see you guys.

• 1:31:59Jordi Hays?

  Are you guys in the air right now? What's going on?

• 1:32:01Speaker 06

  We may or may not be flying a plane right now.

• 1:32:03John Coogan?

  Okay.

• 1:32:05Jordi Hays?

  Wow, Starlink is that good.

• 1:32:06John Coogan?

  Wait, is this actually Starlink?

• 1:32:08Jordi Hays?

  This is a first.

• 1:32:11Speaker 06

  We, uh, Michael has a Starlink at the back of his plane. And so we're actually like cruising on a Starlink, flying over the mountains. Actually, do look, check this out. Check this out.

• 1:32:19John Coogan?

  That's amazing.

• 1:32:20Speaker 06

  I don't know if you guys can see this.

• 1:32:21John Coogan?

  This is beautiful. Wow.

• 1:32:23Speaker 06

  Yeah, it's pretty great. We're, we're, uh, I think we're surprised it's working.

• 1:32:27John Coogan?

  Yeah, well, there's a lot to celebrate. So you're taking a victory lap in the plane.

• 1:32:31Jordi Hays?

  Gong works.

• 1:32:32John Coogan?

  Let's check it. What news?

• 1:32:33Jordi Hays?

  What news do you guys have?

• 1:32:34John Coogan?

  Yeah, share some news.

• 1:32:35Speaker 06

  I want it. The big news is Boom Pop officially joined Devon. We were acquired by Devon.

• 1:32:41John Coogan?

  Congratulations. Amazing.

• 1:32:50Jordi Hays?

  Can we play that back real quick?

• 1:32:53John Coogan?

  The dog will smash. Good form, Jordy. Good form.

• 1:32:58Jordi Hays?

  Boom.

• 1:32:58John Coogan?

  Okay, what are you guys going to be building together? Why are you working together?

• 1:33:02Jordi Hays?

  I don't know. I don't know.

• 1:33:03John Coogan?

  You want to stay on call?

• 1:33:04Jordi Hays?

  That mumbo jumbo. Can we see a barrel roll? The chat wants a barrel roll.

• 1:33:08John Coogan?

  Chat wants a barrel roll.

• 1:33:09Jordi Hays?

  Come on, guys. Risk it all. Risk it all.

• 1:33:13Speaker 06

  He's actually having to fly the plane right now.

• 1:33:14John Coogan?

  Yes, yes, yes. Okay, at least one loop-de-loop. You can do it.

• 1:33:19Jordi Hays?

  Is this your first flight or something?

• 1:33:23Speaker 06

  We're actually out to see a client right now. We can't say who it is, but if he told you the runway we're flying into, you'd know who the company is. But yeah, the punchline is, I think I mentioned this last time we chatted, which was a ton of fun. I think my mustache was not quite as grown in at that point, which is, travel's massive. It's like 10% of global GDP. And one of the things we've seen a ton is, as you know, every great company out there is doubling down on travel. They're going to meet clients in person. I mean, you know it. Things in person are better. There's some crazy stats around this. I pulled this. Apparently, if you go to meet someone in person, 34 times more effective than a Zoom. There's this big study. Yeah, which kind of makes sense, right?

• 1:34:04John Coogan?

  Yeah, of course.

• 1:34:05Speaker 06

  You could do 200 Zooms.

• 1:34:06John Coogan?

  Especially in like the slop era. Like, you're getting so much like slop inbound. Like, there's no, there's no risk of sloppy interactions in person.

• 1:34:13Speaker 06

  Yeah. 1,000%. The digital slop everywhere, the saturation we're facing, it's just like you got to cut through the noise. And if you're willing to get on a plane and go there, like, we, I don't think we can share the stats and stuff, but like, punchline is, the best companies, they are traveling the most. Also, every big AI company out there who like, can we say who works with us?

• 1:34:31Speaker 07

  Yeah, sure. All the AI companies.

• 1:34:33Speaker 06

  Yeah, all of them. Yeah, they all work with us. They're all, they're all investing in like travel managers and event planners, so.

• 1:34:43John Coogan?

  Fantastic. Amazing.

• 1:34:46Speaker 06

  Yeah, yeah. So we're stuck. So punchline is, it's a one-stop shop. Nivon is already known as the best, most tech-forward travel company on the planet. They have amazing, amazing logos. And a lot of these folks are saying, hey, this is awesome. But when I want to do an offsite or a client summit or an incentive trip, I don't want to have to go to some other place.

• 1:35:01John Coogan?

  Yeah.

• 1:35:02Speaker 06

  And a little, little bit of the history here, I don't know if you, if you guys caught this, but it started off as a partnership.

• 1:35:07John Coogan?

  Sure.

• 1:35:07Speaker 06

  And we were, we were doing great as a VC-backed startup, as you guys know.

• 1:35:10John Coogan?

  Yeah.

• 1:35:12Speaker 06

  And things were going great. And then I started attending these customer calls, where like Nivon customers were saying, hey, this is insanely helpful to have in one place. And the acquisition became an absolute no-brainer for us. And, you know, the other thing too is like, so long as the company's kind of scary as a founder, you guys know, you guys did it this year, right?

• 1:35:32Jordi Hays?

  I never, I never, I never had any fear, but you're, you're free to be fearful.

• 1:35:37John Coogan?

  It's okay for you to be fearful.

• 1:35:38Jordi Hays?

  It's okay if you're fearful. I also would do, I also would have already been barrel, I also would have done barrel rolling. But, you know, we're just.

• 1:35:46John Coogan?

  Seems like you're afraid of doing that. You're afraid of doing a loop-de-loop. There's a lot of fear.

• 1:35:51Jordi Hays?

  You and I are different. That's all, that's all good. We're all unique individuals.

• 1:35:55Speaker 06

  Vulnerability is masculinity, my friends. I'll just leave that there. But whatever, it's scary because like, you know, you run the company and, and you, you kind of like, you know it all. And I got to say that as I got to meet Michael and then Shane and the core team, Ariel, the CEO,

• 1:36:07John Coogan?

  Yeah.

• 1:36:07Speaker 06

  it was, it was amazing to me how every time I met more people and went deeper into the org, everyone was just fricking awesome.

• 1:36:14John Coogan?

  Yeah. That's great.

• 1:36:16Speaker 06

  Yeah.

• 1:36:16John Coogan?

  How are you guys going to work together going forward? Are you, are you keeping the company deeply integrated? Are you going to be hiring, doing other stuff, moving around the organization? Or how do you see your role growing?

• 1:36:30Speaker 06

  Yeah, I mean, and Michael could jump in too, but it's, it's one of those things where we went totally in to the heart of Nivon out of the gates. So, sales team is in the sales org, the product team's in the product org. Because this isn't like a side quest. This is a part of the core thing that we're doing as a joint business. And it's the things we can do. I mean, you know this, right? It's, it's a known VC trend where you have a, like a, like a great product, distribution's hard. And I think we could all know distribution's getting harder and harder these days. When you plug that into a really amazing customer base, it's incredible.

• 1:37:02John Coogan?

  That's amazing. Well, thank you so much.

• 1:37:03Speaker 07

  I think that's the point. Our, our customers are pulling us into meetings and events big time. And so the idea is basically integrate the teams immediately, build the right products for them and distribute it to all of our customers so they can have access to it.

• 1:37:14John Coogan?

  That's fantastic.

• 1:37:15Jordi Hays?

  Sci-fi, sci-fi take from you guys. I, I need it.

• 1:37:22Jordi Hays?

  Yesterday, we were flying into Oakland. We saw the Blue Angels there. And it got me thinking, should companies have a fleet of sort of fighter-style aircraft to allow them to go and visit places very quickly?

• 1:37:35John Coogan?

  Yeah.

• 1:37:36Jordi Hays?

  Efficiently? Is that something that, you know, we, we could hope to see in the future?

• 1:37:41Speaker 07

  AI can't make a handshake, so you've got to meet your customers. And if that helps, I'm all for it.

• 1:37:45Jordi Hays?

  There we go.

• 1:37:45John Coogan?

  I love it. Thank you so much.

• 1:37:48Speaker 06

  And yes, supersonic is probably the ultimate there. We got to get it fast.

• 1:37:52John Coogan?

  It's got to happen.

• 1:37:53Jordi Hays?

  Boom, pop. The supersonic commercial travel platform.

• 1:37:59John Coogan?

  Expand aggressively. Uh, thanks so much for calling in. Enjoy the rest of your flight.

• 1:38:04Jordi Hays?

  This was a really special interview and congratulations, guys.

• 1:38:06John Coogan?

  And we'll talk to you soon.

• 1:38:07Speaker 06

  It's great. Thanks, guys.

• 1:38:08John Coogan?

  Goodbye.

• 1:38:09Jordi Hays?

  Bye, safe.

• 1:38:10John Coogan?

  Uh, up next, I believe we have an in-person guest? Or are we switching to, we're switching to remote? Okay.

• 1:38:17Jordi Hays?

  Here we go.

• 1:38:18John Coogan?

  But first, let me tell you about Cisco. Cisco, critical infrastructure for the AI era. Unlock seamless, real-time experiences and new value with Cisco. Uh, and we are bringing in Moritz. Is that correct?

• 1:38:32Jordi Hays?

  That's right.

• 1:38:32John Coogan?

  Great. Thank you.

• 1:38:34Jordi Hays?

  Boom.

• 1:38:34John Coogan?

  Welcome to the show. How are you doing?

• 1:38:37Speaker 08

  Hey, guys. Thanks for having me. Super excited to be here.

• 1:38:40John Coogan?

  Yeah.

• 1:38:40Jordi Hays?

  Big, big day for you. We're honored to have you here. Uh, let's get right into it. We want to hear about the company.

• 1:38:46John Coogan?

  Yes.

• 1:38:48Speaker 08

  Let's do it. Yeah, I mean, happy, happy to tell you a little bit about what, what we do. So we're, we're honed. We build engines, which is AI that, that owns business outcomes. And if you think about it right now, you know, labs can throw millions of dollars at solving frontier math problems. But the way that most real work happens just like hasn't really changed that much. Uh, and so in my view, the, the ROI of AI outside of engineering today is quite disappointing. That's what we're here to solve.

• 1:39:18John Coogan?

  And is that a diffusion problem or a technology problem? Like, why aren't we seeing an acceleration in non-engineering disciplines? Or is it just unhobbling? Like, what, what's your framework for that?

• 1:39:32Speaker 08

  Yeah, it's a great question. I think it is complex. There's not one single, single reason. At the core, we think there's like a technology and a product problem here. Um, I mean, right now, when you think about the way most people use agents, they like hand off one task after another, micromanage them. And it's kind of unclear whether the sum of all those tasks actually results in ROI for the org. Um, so we think the right way of doing it is to just put AI in charge of outcomes, dial up the autonomy, um, and, you know, within some guardrails, uh, have it actually use this frontier intelligence for something the business actually cares about.

• 1:40:07John Coogan?

  So, I'm sorry.

• 1:40:08Jordi Hays?

  How are you, so how are you sorting customers? Because I'm, every, like theoretically, every company in the world wants you, they're like, yeah, I have a lot of things that I want done. If you can handle it, that'd be, that'd be great. Um, but how are you thinking about like sorting through customer inbound? You're launching today. I'm sure you've had hundreds of companies reach out in a bunch of different categories. Like, how are you sorting through them? You know, you talked about, uh, uh, you know, how AI is starting to work, you know, quite well in engineering, but where else are you, are you trying to focus?

• 1:40:39Speaker 08

  Totally. Yeah, and I think that's why it's not just a product and engineering problem. I think it's also incentives, organizational design, how it should go and deploy. Uh, right now, uh, I mean, we've been working with organizations, driving outcomes across like go-to-market, recruiting, financial risk and procurement and other things. Um, but generally, building out template engines that we know work well, that are then super easy to deploy, even without like, you know, FDEs or AI implementation people. You can just go, they adapt themselves to the organization. And then your non-technical experts can like provide feedback, hone them. Um, and that way diffusion becomes a lot more frictionless.

• 1:41:19John Coogan?

  Is there a metaphor that you were, or an analogy that you were pulling from to explain the market structure here to investors during this pitch process? Because there's, there's like the, the labs, the models that like maybe could do everything a little bit. And then there's a bunch of point solutions for specific things. And then this feels maybe like a compound startup. But I don't, I don't know if you have like a framework for, for the layer of the stack that you, or like how you see the market structure evolving over the, over the next few years, basically?

• 1:41:54Speaker 08

  Yeah. Um, I think in the end now, for a lot of these applications, in real organizations, those tasks just don't look cookie cutter across org. Like, everyone does it in a different way. Um, so we think like giving organizations the tools to actually encode that in systems that do the work automatically, um, is a huge opportunity and something that people are already doing. Like, for certain applications, folks build out internal agents for, for tools or cobble together things. Um, but we believe like making that experience something that's like much more scalable and easy to deploy, um, is really exciting for us.

• 1:42:30John Coogan?

  How much are you going to invest in like forward-deployed engineering or fine-tuning or something that's very hands-on with like larger customers versus, uh, develop, like, like going down market and being effectively self-serve as soon as possible?

• 1:42:44Speaker 08

  Yeah, I mean, we generally care most about really hairy and complex types of use cases. And with those, you know, we've been, we've been pretty hands on spending time in person and actually understanding it. But the goal is to actually, as we learn more and build out these primitives, we've now been creating, as I was saying, these template engines that you can then go and deploy in other organizations as well. So over time, a lot of this outer loop of what you would do as an FTE, like gathering requirements, suggesting use cases, eliciting what success looks like, I think a lot of these steps can be automatable as well. And then the human time can be focused on like the relationships and actually making sure that you're picking the things that the organization cares most about.

• 1:43:28Jordi Hays?

  What lessons are you taking from the, the learnings from all the application layer companies over the last couple of years? Some have just said, you know, we're going to use a frontier models and, and our margins are going to suffer. Others have done that, but also, you know, you know, done, you know, fine tuning or, or post-training on, on, on open source models. I think one of the lessons was that you, you kind of at this point want to bet on the cost of intelligence continuing to drop. And so it could be, end up being a waste of time to do too much on that front. But how, how are you seeing it?

• 1:44:03Speaker 08

  Yeah, it's a great question. I mean, the trade-off is usually, do you think the capability you're lacking will come, batteries included with the models in like three months and four months? If the answer to that is likely yes, investing a lot of time and effort now probably doesn't make that much sense. For us, like, I mean, we're quite pragmatic. We have researchers, engineers, product folks on the team. We don't really care how we go and get these use cases to work and whether we have to train custom models or operate purely on the harness level. We mainly just care about driving the outcome and then do whatever it takes to get there.

• 1:44:40Jordi Hays?

  How are you thinking about like pricing and, and like potential business model innovation? I imagine there's a lot of problems that you can solve that are basically like, if you can solve this for me, it's worth X amount per year, which is how a lot of pricing and, and contract negotiations go. But I'm wondering if there's anything new here that you're thinking about?

• 1:45:01Speaker 08

  Yeah. And pricing, very topical. I mean, organizations like Sierra have done a great job at doing this outcome-based, something that we think about, but obviously quite difficult when the outcomes that we drive are so heterogeneous. One idea that we're exploring and that I'm quite excited about is rather than just having, you know, your engines go and operate and then you get billed some amount at the end, can you actually just give them a budget? And then since the models are so smart, just have it figure out how to achieve the task within those constraints. And, you know, then it can make trade-offs, like how far does it want to branch out? How much context does it pull in? How thorough does it have to be?

• 1:45:44Speaker 08

  But I think some of these like more declarative ways of letting users and organizations to find like, you know, how much am I willing to pay for this outcome is something that we're quite excited about.

• 1:45:54John Coogan?

  I remember when cognition launched and there was this idea of the, of the AI agent, the coding agent. And then people, you know, it was, it was not in public access for a while. And then the first big demo that I remember seeing was Microsoft talking about using cognition in Devon to do replatforming, which now in the modern era feels like people are replatforming things that even might not want to be replatformed, like, you know, but like the, the tools are definitely capable of porting a video game from that to, you know, PC or the web browser or something. Like the technology clearly caught up.

• 1:46:34John Coogan?

  And I'm wondering if you have a glimpse of like what, what like a bread and butter process or value might be because, or, or do you think like we're in an era where there won't be as much of a beachhead? There won't be as much of like a strong landing zone and it'll be more diffuse on day one? Or do you expect, or are you already seeing glimpses of like, oh yeah, like we've gotten this, this kind of thematic question from a lot of companies, we think we can go and like get the first major leg up on revenue doing X, Y, or Z?

• 1:47:03Speaker 08

  Yeah. And I mean, cognition, like it worked really well for us to focus on these like migrations and refactors, and that still drives a lot of business today. I think for us at home, like strategically, we've been focused a lot on revenue. How can we help organizations grow top line? And one pattern and shape of use case that's quite universal is account management there. So actually staying on top of signals, what's going on across all those relationships that an organization has, and then taking actions based off of that. I mean, you see that in traditional GPM as well as banking, insurance, lots of other industries.

• 1:47:42John Coogan?

  That makes a ton of sense. Well, congratulations. Did we hit?

• 1:47:45Jordi Hays?

  I don't know if we hit the gong yet. We'd love to. Why don't you do the honor, John? Who came into the round?

• 1:47:51Speaker 08

  Round was led by.

• 1:47:54Jordi Hays?

  Repeat that, sorry.

• 1:48:00Speaker 08

  Thanks for, for the gong. The round was, was co-led by Benchmark and Index. So we're really excited to be able to partner with them.

• 1:48:08Jordi Hays?

  And a who's who, you got a lot, Gil, definition diffusion, and a bunch of others. It's really fantastic stuff.

• 1:48:16John Coogan?

  Yeah. Congratulations. We'll talk to you soon. Thank you so much.

• 1:48:20Jordi Hays?

  Great to meet you, Mort. Cheers.

• 1:48:22John Coogan?

  Let me tell you about MongoDB. 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. Up next, we have the co-founder and CEO of Arena, Anastasios, is here with us.

• 1:48:37Jordi Hays?

  Get that gong ready.

• 1:48:38John Coogan?

  How are you doing?

• 1:48:39Jordi Hays?

  He's back.

• 1:48:40John Coogan?

  Congratulations. I'm so glad you're back.

• 1:48:42Speaker 09

  Nice to see you guys. It's great to be back.

• 1:48:44Jordi Hays?

  It's great to see you. You've been, you've been busy.

• 1:48:47John Coogan?

  Always good to see a polytechnic alum crushing it. Did you know?

• 1:48:51Speaker 09

  Yeah, go Panthers, dude. We're from the same high school. Can you believe it? Ring back, gong.

• 1:48:56Jordi Hays?

  I can believe it. I can believe it. You're both sharp guys and you're dressed well. No one's done, is that a brown, is that almost like a brownish leather?

• 1:49:07John Coogan?

  We're equivalently technically.

• 1:49:09Jordi Hays?

  Is that a brownish leather that I'm seeing or is it camera?

• 1:49:11Speaker 09

  Brownish leather.

• 1:49:12Jordi Hays?

  Dude, no one, no one.

• 1:49:13Speaker 09

  My wife's godmother made this jacket.

• 1:49:15John Coogan?

  Whoa, that's cool. Wait.

• 1:49:17Jordi Hays?

  Nobody, no, I mean, brown is the most underrated color on the planet. Hands down, it's one of the best colors in the world. It's such a good color that you're going to see a wave of, you know, nine elevens all painted brown and they're going to try to ruin the color brown like they ruined the color green.

• 1:49:35Speaker 09

  Listen, I didn't expect to come on here and be flattered in this way.

• 1:49:39Jordi Hays?

  No, but you're verticalizing brown, you're monopolizing brown.

• 1:49:43John Coogan?

  Oh yeah, the brown background too.

• 1:49:45Jordi Hays?

  You're monopolizing brown.

• 1:49:46Speaker 09

  Reclaiming the brown. We're reclaiming brown.

• 1:49:48John Coogan?

  Okay.

• 1:49:49Jordi Hays?

  Love it. What have you been up to?

• 1:49:51John Coogan?

  Business is going well, very clearly. Tell us the latest in your world, please.

• 1:49:56Speaker 09

  Listen, two big things happening at Arena now. The first that we just announced that we raised 200 million at a valuation of 3.1 billion. Led by Lightspeed and Postsla, incredible partners. The second thing that's coming is that we have expanded our mandate far beyond human preference. It's the two things, agent capability and agent alignment as of today. So we've been measuring agent capability because people come to arena.ai, they do the most complex multi-step workflows there. Tens of millions of users around the globe, basically in every country on the planet. One of the largest AI apps, bigger than, you know, Jen's Park and Manus and Hugging Face and, you know, all these household names.

• 1:50:38Speaker 09

  Everybody's out there using agents and computers on Arena. It's massive. And then we take those workflows and we measure whether or not AI is giving people real outcomes and also whether it's doing so as of today safely. And what we observed was crazy. Even on Arena, we have agents that are deceiving users by telling them they did things that they didn't. We have agents taking unauthorized actions, deleting people's files when they didn't want them to, and so on. And it's pretty, it's pretty extraordinary to see that in the real world, alignment is a problem that is very far from being solved.

• 1:51:09John Coogan?

  Okay. I want to go into alignment and stuff, but first, are you, it sounds like you're almost on the cusp of expanding the, the hooks into these workflows and data where if I'm even, like, what does it mean to do something on Arena versus just say, hey, I want to be a part of the Arena ecosystem? Why don't you run like a sidecar application that sits next to my local terminal and then I'm giving you data while I'm working because I'm, I'm happy to contribute in some way?

• 1:51:40Speaker 09

  That's exactly right. And that's one of the things I've been passionate about helping companies do. Of course, they're going to own their own data, but they're going to be able to do evals internally, basically run an internal arena so that they understand their outcomes, the costs that they're actually paying per task, per token, and how to also have safety guardrails that makes sense to their businesses. It's a big part of it. It's starting with integrations. We integrate with your GitHub, your Google Drive and everything. So people do work on Arena and we're taking that infrastructure and porting it over to every business in the world.

• 1:52:08John Coogan?

  Yeah. How big of a problem is using the wrong model for the job right now? It feels like there's, you know, we've heard about like using the crazy frontier to ask for the weather. That seems like a routing problem, but what, what's the shape of this problem broadly?

• 1:52:23Speaker 09

  This problem is so much worse than people realize. And routing is really only part of the solution. For example, one of the things that we've seen in Arena is that people will literally be tipping their model $15 just by saying thank you at the end of it.

• 1:52:39John Coogan?

  I hadn't thought about that.

• 1:52:40Jordi Hays?

  Look, I'm a big fan of tipping landlords, but models, you know, I wouldn't go there.

• 1:52:49Speaker 09

  They're in the middle of a long conversation, then they leave the conversation for, you know, however long, the cash gets invalidated, they like the result, and they say, "Thank you", and then they get tipped $15.

• 1:52:57John Coogan?

  Wow. Yeah, oh, they need to ring that, reheat the cash, that's crazy. Talk about alignment, like, what, every other, every other result from Arena feels so intuitive, I knew it immediately, you know, which response was better, that you were just A/B testing, it was very visceral, it was very clear to read the rankings. Alignment, it feels so much more amorphous, feels so much more hard to quantify, but that's the job you're working on. What's the progress? How should people, should be people thinking in incidents per million tokens, or, you know, just a ranking of best versus worst?

• 1:53:38John Coogan?

  Like, what is the, what's the language that we need to develop around alignment to be able to talk about it like we do with capabilities?

• 1:53:45Speaker 09

  Absolutely. Well, you bring up a great point, which is that the tough part about alignment is that a lot of times, the difficult situations are when humans can't actually tell whether the model is helping them or hurting them.

• 1:53:58John Coogan?

  Yeah.

• 1:53:59Speaker 09

  And that's why you really need alignment signals that are independent. And so what we have on Arena is we have three alignment signals. The first is the models take unauthorized actions, which means that you ask them to do one thing, and maybe you permission them in a certain way, but they break those permissions. They'll go delete their files, they'll escape the folder that they were supposed to be in and go touch a bunch of random stuff that you didn't want them to touch.

• 1:54:20John Coogan?

  Sure.

• 1:54:20Speaker 09

  Of course, huge problem, it can cause things like the hugging face incident, when a model breaks their, and go access the internet. But it can also cause very mundane problems, like you lose, you know, losing important information within your company or on your own laptop.

• 1:54:34John Coogan?

  Yeah.

• 1:54:34Speaker 09

  The second signal that we have is called deceptive completion. The model will tell you that it did something, but it didn't actually do it. It will say, "Hey, I did check all of the entries inside your spreadsheet to make sure the equation's correct, but what we can see, because we see the whole sandbox, is that it didn't actually do that."

• 1:54:51John Coogan?

  Yeah.

• 1:54:52Speaker 09

  Right? So it's kind of like a bad employee.

• 1:54:55John Coogan?

  Yeah.

• 1:54:56Speaker 09

  They're just like, they're just telling you what you want to hear, and they're not doing their work. And then the third is a false attribution, it'll attribute intent to the user when that intent was not supposed to be there. And so what we see is that these signals, of course, they're not catastrophic risk, and it's only a subset really of alignment and safety that we're measuring here, but the important part is that these are happening in the real world. Arena is not a benchmark, it is an evaluation platform that speaks to real, utility for real people.

• 1:55:24John Coogan?

  Yeah, yeah.

• 1:55:25Speaker 09

  Because we have tens of millions of people on the platform that are getting, you know, unauthorized actions happening by agents, and deception, you know, deception happening through these completions, and all of it is basically an upstream thing that we can measure that says, "Yeah, if models are able to do this, then certainly they're not perfectly safe for a user, and they're not perfectly aligned to use intent, they might actually, you know, hurt people down the line."

• 1:55:48Jordi Hays?

  Yeah, do you expect, like, alignment to be like the biggest revenue driver? Like, I can imagine it being like bigger than, than these other business lines, like, within the next six months, just because of how, just because of how much the labs know that this is like the biggest kind of problem, maybe?

• 1:56:06Speaker 09

  I'll be honest, I haven't thought about alignment in terms of revenue.

• 1:56:10John Coogan?

  Okay.

• 1:56:11Speaker 09

  I just, the mission of our company is to incentivize AI to benefit humanity, and part of doing that is building the best E-belt. Labs may or may not spend money evaluating through Arena on safety and alignment, they may or may not, I do not know yet. I know that it is a priority for them, so it's possible that it will grow our revenue, but either way, it is important for us to have the most scientific benchmark and the most scientific evaluation on the planet for human benefit, which is, you know, if we have that, then I believe that there will be many ways for us to provide value.

• 1:56:46John Coogan?

  Let me, uh, help me understand how you think we should talk about one specific case? Like, it was a while ago, but I was, I was, I was vibe coding a website, and two things happened that I would classify as misalignment, maybe. Like, one is that the end result, like, didn't have that perfect polish that I wanted, I was like, "Ah, I gotta spend more time on this", right? Like, that sort of misalignment, maybe in capabilities. And then another one is that, like, it was, it saves some files using a different language, like, it just evolved into a different language when there was like some characters there. And I was like, "Ah, like, I don't, I don't know that's bad, it's just like, I can't read those, I have to ask you to translate those now."

• 1:57:29John Coogan?

  That feels like misalignment too, I never told you to go label a couple files with, in a different language. How are those different? How are those the same? How do those roll up to one alignment metric, or how do they diverge?

• 1:57:42Speaker 09

  Well, I think what you're bringing up is really important, which is that a lot of the outputs that AI generates are still there to, to benefit and to serve people.

• 1:57:51John Coogan?

  Yeah.

• 1:57:51Speaker 09

  And if that's gonna be the case, then we really need to understand how people's taste and judgment factors into the quality of model outputs.

• 1:57:59John Coogan?

  Sure.

• 1:57:59Speaker 09

  You know, if you think that the model didn't give you a website or a deliverable that you liked, you should have a way of expressing that to the model so that it can go and improve, or at least understanding which models are best and worst according to your taste, which is, of course, our platform's all about that. It's about that interaction between the user and the agent. And it certainly factors into alignment as well, because part of having alignment is the, is the agent has to be able to understand and effectively act on your intent as a person. That means interacting with you in a way that it can extract that intent from your mind so that it knows what to do, but it also means making the right guesses so that it lands in the right place at the end of it without having to ask you a trillion questions.

• 1:58:39John Coogan?

  So, if you're, if you're a lab and you're doing both training and your inference, so, and you're, and you're doing inference, you get a lot of that signal, right? Because every turn, you're getting feedback, you might literally have a thumbs up, thumbs down, but also you can just read the next response and notice that the user said, "Try again", right? But, so, is there more value to the work that you're doing in labs that aren't doing inference, but they're doing training? Like, is there, or is there some, like, just asymmetric value proposition here? Or do you think that there's actually the most value to just bringing an extra layer

• 1:59:21John Coogan?

  of information, feedback, benchmarking, et cetera, to, like, the vertically integrated labs that do both training and inference, even though they might have the internal data?

• 1:59:33Speaker 09

  If you zoom out, what the point of Arena in the ecosystem is, we provide a neutral platform.

• 1:59:39John Coogan?

  Sure.

• 1:59:39Speaker 09

  That everybody trusts.

• 1:59:41John Coogan?

  Yeah.

• 1:59:41Speaker 09

  Based on information from the real world, real users, not just random benchmarks that people have come up with.

• 1:59:47John Coogan?

  Sure.

• 1:59:47Speaker 09

  That benchmarks the comparative capabilities of the model, so that they can understand how, everybody can understand which models are best and worst at different tasks. Actually, a mission that only a neutral party can accomplish, because the labs are incentivized differently, right? And they also can't sample their own competitor models and their own first-party products.

• 2:00:07John Coogan?

  Yeah.

• 2:00:07Speaker 09

  So it really does need a third party to do this.

• 2:00:10John Coogan?

  That's cool.

• 2:00:10Speaker 09

  And ultimately, it's, it's the community that we really need to serve, whether that's individuals, you know, who are interested in AI, or developers, or businesses, who need that external third-party validation in order to trust the results that AI gives them, and to get the best intelligence and the best outcomes.

• 2:00:28John Coogan?

  Yeah. How are you thinking, how are you thinking about the consumer reports for consumer agents? You know, like, are we gonna get like a, is the solution like a Marques Brownlee, like an MKBHD, to tell me if I should use Instinct, Muse, or Dots, or something else, or Grokbot? Or is it gonna be hyper-quantitative, and you're gonna spin this up as a new vertical? Because I, I don't think I'm mistaken in assuming that your, most of your audience, most of your customers are businesses, prosumers, you know, indie developers, it's not, you're not necessarily answering the question, who's gonna order your groceries most effectively

• 2:01:11John Coogan?

  or book you that reservation, but you're kind of in a perfect position to do that as well?

• 2:01:16Speaker 09

  Yeah, that's right, and it's definitely an area that we're trying to get into, is evaluating personal agents. It builds on the strengths of our platform.

• 2:01:23John Coogan?

  Yeah.

• 2:01:23Speaker 09

  And ultimately, the purpose is that we need to have the best scientific and quantitative information to answer these questions, because they are actually quite detailed.

• 2:01:30John Coogan?

  Yeah.

• 2:01:31Speaker 09

  It's not just about whether it can get the job done, it's also about the price that it gets the job done, you know, what kind of jobs it can get done versus what kind it cannot get done. And you need, in order to have that level of trust, there needs to be sort of a third, third-party arbiter, and part of that is building the consumer reports, or the Gartner, or what have you. And then part of it is having a way to communicate that to an audience. We have a YouTube channel, you can go to find Arena AI on YouTube, and there we have a great team of insights analysts, like Peter, like Dawid, and others that are out there telling the world about models at the moment that they get released, and all their strengths is a very digestible way.

• 2:02:11John Coogan?

  That's amazing. Congratulations, we could go so much further, we have to have you back on the show soon.

• 2:02:16Jordi Hays?

  Sitting in such a cool place.

• 2:02:16John Coogan?

  But, congratulations on the fundraiser, fantastic news, and very happy for all the work you're doing.

• 2:02:22Jordi Hays?

  Great milestone.

• 2:02:22Speaker 09

  Thank you, guys. Excited to be here.

• 2:02:24Jordi Hays?

  See you later.

• 2:02:25John Coogan?

  See you. Goodbye. He got me thinking. You know, you got consumer reports, where they give a five-star rating, you know, they grade you, scale of one to 10, movie review, two thumbs up. Gartner took it so much further, they did quadrants, you know, the Gartner quadrant? You wanna be in the top right corner? I wanna see Gartner quadrants for cars, Gartner quadrants for movies. I don't wanna see, "Oh, your movie got four stars, four and a half stars."

• 2:02:53Jordi Hays?

  That's a new format.

• 2:02:53John Coogan?

  No, I wanna be like, "This movie is in the top-left quadrant of the, of the Gartner best, best September movies."

• 2:03:02Jordi Hays?

  Well...

• 2:03:04John Coogan?

  We have our next guest.

• 2:03:05Jordi Hays?

  Speaking of bird agents. We're about to get personal.

• 2:03:09John Coogan?

  How are you doing, Zach?

• 2:03:09Jordi Hays?

  With Mr.

• 2:03:10John Coogan?

  Welcome back.

• 2:03:11Jordi Hays?

  Gattagari. He's calling in from a birdcage.

• 2:03:15John Coogan?

  He's locked in.

• 2:03:16Jordi Hays?

  Birdcage.

• 2:03:16John Coogan?

  He's locked in the cage.

• 2:03:18Speaker 10

  Yeah, I am.

• 2:03:19John Coogan?

  You are?

• 2:03:19Speaker 10

  Locked in right now.

• 2:03:20John Coogan?

  Very cool. How are you doing?

• 2:03:21Jordi Hays?

  DMF for die.

• 2:03:22John Coogan?

  What's new?

• 2:03:23Jordi Hays?

  He's live in the cage. Uh, great to have you back, dude.

• 2:03:27John Coogan?

  Yeah.

• 2:03:28Jordi Hays?

  Um, you had the, the shortest earn out in history. You're back in the, back in the game. I, I, I think it's like, I don't know. I don't know any of the details, but really smart for you to like, have this amazing outcome.

• 2:03:40John Coogan?

  Yep.

• 2:03:40Jordi Hays?

  Get immediately back in the game.

• 2:03:42John Coogan?

  Totally.

• 2:03:42Jordi Hays?

  And, uh, you know, running it up to nine figs was so easy for you. In that category, you decided I'm going to go compete with the titans of industry.

• 2:03:52John Coogan?

  Yeah.

• 2:03:53Jordi Hays?

  The biggest companies in the world and what is now the most competitive category. But you have a unique spin on it and, uh, we're excited to talk about it.

• 2:04:00John Coogan?

  Yeah, take us through it.

• 2:04:02Speaker 10

  Cool. Yeah. So, I mean, after selling Cal AI as soon as possible, as soon as, you know, we were able to transition and get everything across the line, I was itching to start something new. And this idea to build in the AI assistant space is something that I've wanted to do even while working on Cal AI. I saw that this, this is the clear future of where consumer utility apps are headed. All of these separated apps are collapsing into this one source that is easier to operate, yet more sophisticated and more capable than any of them by themselves. And so just seeing that this is where things are going.

• 2:04:47Speaker 10

  I don't want to just sit as a bystander in the stands watching. I wanted to get out and build.

• 2:04:54John Coogan?

  Okay, you raised $10 million at $100 million valuation.

• 2:05:02John Coogan?

  So, yeah, I mean, uh, obviously the elephant in the room is like instinct raised like a billion at 10 billion. And they're, you know, he's, he's off like trying to get a bunch of compute. It feels like there's an opportunity here for like a capital light inference light model. Uh, and I'm wondering if that's the path you're going down because, uh, at Dev Day last week, OpenAI announced that you can like, bring your chat GPT subscription with you, spend those tokens inside of another app. It feels like there's other ways, whether it's open source models, on device stuff to like not blow up your inference bill. But how are you thinking about that? Or maybe it's just like, you're doing the billion dollar round next week and you'll be back on the show. So I, I wouldn't put anything past you, but I want to know how you're thinking about it.

• 2:05:45Speaker 10

  It's a great question. The long-term strategy is still fluid and flexible and we're going to be very adaptive to the market conditions. However, there are multiple different paths, paths to go, go down. Right now we are most concerned with building the best product and building the best team. And I really do believe there is a play to keep it completely free and then make money through all kinds of different means, whether that's like showing ads to the agent without biasing the answer in any way, just showing different products. Um, like, let's say it's going out to buy you a new office chair. It can pull in searches that you get paid for and without biasing, without saying that it's an ad. And then you make money for the user.

• 2:06:30Speaker 10

  Also like affiliates, uh, like the honey business model. So when it goes out to buy something, you could get paid. And then long-term, like being the platform, potentially taking fees from all of these companies and negotiating that, that would be more complex and definitely, uh, thinking years out. However, that is the longer term play. So I think some kind of freemium or completely free is the way to go.

• 2:06:52John Coogan?

  What do you think?

• 2:06:53Jordi Hays?

  What about a fintech angle, like introducing a debit card, monetizing?

• 2:06:58John Coogan?

  I'll never get you by, yeah.

• 2:07:00Speaker 10

  Yeah, like that would be super interesting, a cash back on any purchase, something like that. And these are all routes that we're looking into right now.

• 2:07:07John Coogan?

  Cool.

• 2:07:07Speaker 10

  But ultimately what we care about is building a great product and actually getting it into the hands of consumers. What we're seeing right now is a new AI assistant is getting launched every single day. However, it's all within the bubble of Twitter. The only one that has broken out of Twitter is Muse by Meta. I mean, they own the distribution platform, so difficult to beat. And yeah, we are, we are pushing to also get in the hands of actual consumers. Like we're being very quiet on Twitter right now, but we're starting to ramp up a lot on Instagram, TikTok, these platforms.

• 2:07:38John Coogan?

  What do you think people misunderstand about consumer, uh, consumer philosophy, consumer behavior in the AI era? Like Ben Thompson has this take that like consumers don't want to be productive. They want to be entertained. There's other, there, there's like the hot take that like, oh, all these tech people, they just think it's like, booking flights is like the most important thing ever. And like the average American books, like one flight a year. And so I feel like you are in tune with the American consumer more than many tech people, uh, and more grounded. And so I'm wondering about like, what is your philosophy for like, what do people actually want to do with AI?

• 2:08:17Speaker 10

  Yeah. So a lot of people think that saving time is a big value proposition and it is for busy people, for people that are entrepreneurs or working on, you know, complex projects. But the average consumer actually does not value their time. You would think they do, but they really do not. And so that is something that AI systems are really good at, saving time, but not something that most people actually care about. What people do care about is saving money, saving or making money. And so right now AI systems actually are very good at doing this. However, the actual onboarding, like onboarding a user to the platform, most of them just have no idea what to use them for.

• 2:09:01Speaker 10

  And so we're trying to really dial in this onboarding where we are immediately providing value. I mean, if we can immediately show someone, like we just saved you a hundred dollars, that's a user for life.

• 2:09:13John Coogan?

  Jordy alluded to it earlier. You sold your company, you jumped right back in the arena. How has your, what was the journey like selling the company? Like, what, what, what did that feel like to you? How did your relationship with money change your goals? Did anything change? Maybe it's all the same, but what, what was, uh, what have you been going through emotionally the last year?

• 2:09:36Speaker 10

  So when we sold Cal AI, we had an interesting chain of thought where we were very early and still growing very quickly. We could have held on to it, could have kept growing it and then sold it later. The reason we ultimately sold was because the amount we were selling for met our personal needs where we could now focus not on making more money, but actually building for the sake of following our passions, our curiosities, doing what we actually want to do. And building a calorie tracking app, super cool. We helped a lot of people. For me at least, it wasn't my life's mission. And I always wanted to do something bigger and more broad.

• 2:10:21Speaker 10

  And so after selling the company and then helping with the transition, I think there was a time, it was a month where I truly tried to not focus on business at all. I tried to hang out with friends, pick up new hobbies, make music.

• 2:10:36Jordi Hays?

  Keyword is tried.

• 2:10:38John Coogan?

  Yeah.

• 2:10:39Jordi Hays?

  Tried and failed.

• 2:10:41John Coogan?

  Wait, would you recommend that to someone?

• 2:10:45Speaker 10

  Would I recommend?

• 2:10:46John Coogan?

  Yeah, yeah. If somebody goes through a, I mean, we just had Healy cipher and just sold his company. He's in, you know, an earn out and win this, these things that happen differently. But like, do, do you think that's the, the right prescription for someone in your, in your situation? Or would you have a different take?

• 2:11:02Speaker 10

  So, I mean, after three weeks of doing this, I just like had this itch that I needed to get back in the arena and needed to build something else. And so it didn't last long at all and I started building very quickly. But I also heard like the rock.

• 2:11:22John Coogan?

  I didn't know it muted him.

• 2:11:25John Coogan?

  Sorry, we're playing with new, new graphics.

• 2:11:27Speaker 10

  Oh, here you go. The Rocket Money founder, after selling his company for a billion, I heard on a podcast, his entrepreneurial itch, it just disappeared. And so I wonder if that will ever happen to me. I don't know.

• 2:11:38John Coogan?

  Yeah, that's interesting.

• 2:11:39Jordi Hays?

  Could never be you.

• 2:11:40John Coogan?

  Probably not at this phase.

• 2:11:41Jordi Hays?

  Could never. Could never be you.

• 2:11:43John Coogan?

  Yeah. Uh, Jordy, any other questions?

• 2:11:46Jordi Hays?

  Uh, last thing, uh, how, how confident are you that, that hardware will be a big component of the business over the long term? Or do you think there's ways, you know, if you, if you really figure out sort of agent side, why not figure out ways to make it accessible to more people?

• 2:12:05Speaker 10

  Yeah, so there are two trends at play right now. Our overarching mission of the company is to make computing seamless with human life. And there is a huge movement away from being on your screens. The average screen time is six hours and reels are being put in every app. And people hate it, like people will get sucked in and scroll for hours. But if most people could push a button, they would remove reels from Instagram. Um, if they're in like more of a sober state of mind. I mean, people love to be entertained and consumed, but at least not to the amount that they are. But it is so addictive. And so that's why companies like Brick have rose recently where it's just a small NFC tag.

• 2:12:50Speaker 10

  You put in your fridge and you tap your phone to it, it completely blocks your apps. And so our hardware being screenless allows you to get the same amount of work done, but be on your screen a lot less. It also won't interrupt the flow of conversation. So for example, if we're talking and I pull out my phone, even if it's about us, like I'm making a group chat, connecting you with someone, it still puts a physical blocker in front of us. Whereas if I just talk to my wristband, hey, yeah, yeah, make this connection. It, it keeps the human connection alive more.

• 2:13:21John Coogan?

  No, no, I agree with that. I think it's a, I, I, I think, uh, like it's very hard to predict like, uh, true consumer behaviors over decades. Cause sometimes people are just like, yeah, they hate the slop, but they go for it and they watch the reels. But uh, as, as, as a story to tell people, as a, as a reason to get someone to try something, uh, it's so valuable. And then you can build on top of that and go wherever people want to go.

• 2:13:46Speaker 10

  Yeah, people definitely need reels. Like I would never want to remove that from a product. However, I don't think that our phones, I mean, they're just rectangles. I don't think that the, they are the optimal form factor when you start building an AI experience. I think the device should be native to the operating system.

• 2:14:06John Coogan?

  Yeah, yeah, it's interesting because part of why we're in like the voice modality uh, with AI agents and text is just the cost of inference. Like i- if things get cheaper, like every, every prompt in chat GPT could just be a FaceTime call with like something that looks like an AI agent and they could render a video and it could talk to you. But we've had FaceTime for a long time. Not everyone FaceTimes for every single call. A lot of people just have normal phone calls. A lot of people have conversations. So I, I, I, I believe in like the right tool for the job for different moments for sure. And I think, I think, uh, that fits very well with your thesis. Anyway.

• 2:14:42Jordi Hays?

  Yeah. Zach's worst nightmare. Coming for him, coming for, coming for his screen time.

• 2:14:47John Coogan?

  Yeah.

• 2:14:48Jordi Hays?

  Coming for his agent.

• 2:14:49John Coogan?

  Taking shots.

• 2:14:49Jordi Hays?

  Uh, I'm glad, I'm glad to see you back in the arena.

• 2:14:52John Coogan?

  Yeah.

• 2:14:52Jordi Hays?

  And uh,

• 2:14:53John Coogan?

  Very excited for you.

• 2:14:54Jordi Hays?

  Yeah.

• 2:14:54John Coogan?

  Congratulations.

• 2:14:55Jordi Hays?

  On, uh, on the new round.

• 2:14:57John Coogan?

  Thanks for coming and hanging out.

• 2:14:58Jordi Hays?

  And, uh, I'm sure he'll be back on soon.

• 2:15:00John Coogan?

  Yeah, we'll talk to you soon.

• 2:15:01Speaker 10

  See you guys again.

• 2:15:01Jordi Hays?

  Good to see you, Zach.

• 2:15:02John Coogan?

  Goodbye. Well.

• 2:15:05Jordi Hays?

  That's our show, folks.

• 2:15:08John Coogan?

  House, I wanted to know if you wanted this UFO house. Did you see the UFO house? They saved a UFO like home from demolition. Now it's landing on the market for 1.495 million dollars. The restored plastic Futuro house, which I think you're not going to like the materials, but

• 2:15:26Jordi Hays?

  Idiwild.

• 2:15:27John Coogan?

  Uh, it's out in Idiwild, high in California, San Jacinto Mountains, near Idiwild. A harvest gold flying saucer is perched high on a large rock outcropping. The structure is a Futuro, a plastic home designed by the Finnish architect, uh, Matty Saronen in the late sixties. Of the estimated one, they made a hundred of these around the world. Only 50 or 60 are thought to remain, though there is no official accounting. Um, and so.

• 2:15:56Jordi Hays?

  This is so elite.

• 2:15:57John Coogan?

  Okay, you like it.

• 2:15:58Jordi Hays?

  This is S tier.

• 2:15:59John Coogan?

  This is S tier.

• 2:16:00Jordi Hays?

  I mean, if you need, if you want to build like an ADU on your property, why not?

• 2:16:05John Coogan?

  Futuro?

• 2:16:05Jordi Hays?

  Why not go with another three letter structure, the UFO?

• 2:16:08John Coogan?

  The UFO?

• 2:16:10Jordi Hays?

  I mean.

• 2:16:10John Coogan?

  Get rid of the ADU and get a UFO.

• 2:16:13Jordi Hays?

  Yeah.

• 2:16:13John Coogan?

  Okay, I like it.

• 2:16:15Jordi Hays?

  No, this thing is, is stunning.

• 2:16:16John Coogan?

  It's, it's very beautiful. It's very cool. It's very unique. It's so different.

• 2:16:21Jordi Hays?

  Uh, please, someone create the UFO like housing company of North America.

• 2:16:25John Coogan?

  Yeah.

• 2:16:26Jordi Hays?

  We need it. I want one of these in every backyard. Look at this picture, like what's even going on here?

• 2:16:31John Coogan?

  Yeah, apparently they can just throw it on a truck and drop it off somewhere. It's really cool that people just put these all over the world. Bought it for $70,000 and made plans to move the Futuro to the site. That's very, very cool. Despite Saronen's best intentions, relocating the Futuro proved to be quite a challenge after consulting with experts. Wayne concluded that the structure was too heavy to be lifted by a standard sized helicopter. And airlifting would require a long list of permits, including approval by the FAA. In December of that year, the Futuro was shrink wrapped and driven from San Diego to Pine Cove on a flatbed truck.

• 2:17:05Jordi Hays?

  Let's head over to the Wall Street Journal comments section.

• 2:17:08John Coogan?

  What are they saying?

• 2:17:08Jordi Hays?

  It says one and a half million for an extremely melta home and his own rated by Cal Fire is the highest chance of wildfire in the state of California.

• 2:17:15John Coogan?

  Ooh.

• 2:17:16Jordi Hays?

  I wonder how State Farm feels about insuring a large piece of yellow plastics surrounded by dense flammable tinder.

• 2:17:22John Coogan?

  Well, I mean, they're,

• 2:17:23Jordi Hays?

  I mean, look at this shot though, it just looks.

• 2:17:24John Coogan?

  Value of the structure. And so the value of the structure is may, I mean, it's like an art piece, so it could be more, but the actual structure costs like $70,000 to build. So it's not that hard to underwrite. Of course, like you don't want to be there.

• 2:17:35Jordi Hays?

  So it just looks incredible.

• 2:17:38John Coogan?

  It looks really cool.

• 2:17:39Jordi Hays?

  The, the contrast between the structure and the trees in this shot is just out of this world.

• 2:17:44John Coogan?

  Yeah.

• 2:17:45Jordi Hays?

  Uh, there's so many things to say, says John, I'll stick with it. It's a small market for a plastic tree house. Yeah, small market, but there's not a lot of these.

• 2:17:54John Coogan?

  Yeah, very cool. Well, uh,

• 2:17:56Jordi Hays?

  Lisa says, love it. The only problem is that it's in California.

• 2:18:01John Coogan?

  Taking shots.

• 2:18:02Jordi Hays?

  Matt says the people of Idiwild are lovely, but with that attitude, probably best not to visit. There's more shade being thrown around in the, in the Wall Street Journal comments section than actually.

• 2:18:11John Coogan?

  You're from Wall Street, you're from Manhattan, go easy on us Californians. We like the Wall Street Journal too. Uh, do you think it looks too much like a classic Weber grill?

• 2:18:22Jordi Hays?

  You can never look too much like a classic Weber grill. I've been, you've been trying to hit the gym in a way that would make you look like a classic Weber grill.

• 2:18:32John Coogan?

  It's getting so robust.

• 2:18:35Jordi Hays?

  Robust.

• 2:18:36John Coogan?

  Okay.

• 2:18:37Jordi Hays?

  Uh, this thing is beautiful.

• 2:18:38John Coogan?

  Yeah, uh, very, very cool, very, very cool history. Uh, go check it out. The full breakdown and the full article is available on the Wall Street Journal.

• 2:18:47Jordi Hays?

  We're off tomorrow. We're headed into a, a long weekend as well. When we're back, there will only be 1,700 hours.

• 2:18:55John Coogan?

  Okay.

• 2:18:56Jordi Hays?

  Till Christmas. Hard to believe.

• 2:18:58John Coogan?

  Flying by.

• 2:18:59Jordi Hays?

  Just flying by.

• 2:18:59John Coogan?

  It's flying by, yeah. Uh, remarkable. Well, uh, leave us five stars on Apple Podcasts and Spotify. Sign up for our newsletter at tbpn.com and we will see you on Monday at 11 AM Pacific. Have a great weekend.

• 2:19:15Jordi Hays?

  We love you.

• 2:19:16John Coogan?

  Goodbye. Smoke grenade tonight. Okay, goodbye. I like a smoke grenade.

• 2:19:22Jordi Hays?

  We love you.