Keith Rabois, Logan Bartlett, Shane Arnott, Flo Crivello, Rahul Sonwalkar, Bryce Roberts, Ben Thompson on Trade, Tariffs, and Tech, Anduril Releases Coppherhead

TBPN.com is made possible by: Ramp - https://ramp.com Eight Sleep - https://eightsleep.com/tbpn Wander - https://wander.com/tbpn Public - https://public.com AdQuick - https://adquick.com Bezel - https://getbezel.com Numeral - https://www.numeralhq.com Polymarket - https://polymarket.com/ Follow TBPN: https://TBPN.com https://x.com/tbpn https://open.spotify.com/show/2L6WMqY3GUPCGBD0dX6p00?si=674252d53acf4231 https://podcasts.apple.com/us/podcast/technology-brothers/id1772360235 https://youtube.com/@technologybrotherspod?si=lpk53xTE9WBEcIjV (03:04) - Ben Thompson on Trade, Tariffs, and Tech (31:12) - Anduril Releases Copperhead High-Speed AUV (37:09) - Joe Weisenthal Analyzes Trump Tariffs (43:52) - What Tariffs Mean for Venture Capital (45:38) - Shane Arnott (01:16:04) - Logan Bartlett (01:48:21) - Keith Rabois (02:14:48) - Bryce Roberts (02:32:50) - Rahul Sonwalkar (02:47:21) - Flo Crivello

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

• 0:00John Coogan?

  You're watching TVPN. It's Monday, April 7th, 2025. We are live from the

• 0:05Jordi Hays?

  Temple of Technology.

• 0:07John Coogan?

  The Fortress of Finance.

• 0:09Jordi Hays?

  The Capital of Capital.

• 0:11John Coogan?

  Uh, this is exactly where you want to be on a day like today.

• 0:14Jordi Hays?

  The timeline is in turmoil.

• 0:16John Coogan?

  The timeline's in turmoil. You gotta go to the Fortress of Finance.

• 0:19Jordi Hays?

  That's right.

• 0:19John Coogan?

  You gotta find out what's going on from the experts. Trust the experts.

• 0:23Jordi Hays?

  In geopolitics.

• 0:24John Coogan?

  Because we have been reading the timeline all day, so we're experts.

• 0:28Jordi Hays?

  Yeah.

• 0:28John Coogan?

  We're experts.

• 0:29Jordi Hays?

  We've been reading the information on the timeline. We've been getting misinformation from the timeline. We've been mixing it up and we're here to deliver it.

• 0:37John Coogan?

  We're here to deliver.

• 0:38Jordi Hays?

  Live.

• 0:38John Coogan?

  You always know it's bad when the Wall Street Journal redoes their front end web design. Today, it's looking terrible. I don't know if you can pull that up, the first slide, but uh, they, it's no longer just a normal list of stories. There's only one story and that's the market chaos. And so you literally, you go to the Wall Street Journal's website and it's just like, here's exactly what's going on. You need to be tracking this live because it's uh, it's bad news. Uh, the markets are down. They went five percent down Thursday, five percent down Friday. Uh, I was golfing with a buddy. He's like, oh, if we have a big leg down on Monday, could be in business because he does like distressed financings. Cause so he's always like vulture. Yeah, I'm going to lick my chops. Like getting excited. It's always bad. Uh, but yeah.

• 1:23John Coogan?

  We didn't quite get another five percent leg down. The markets uh, have been up and down all day. There was a rumor, the futures were trading down at five percent. We might see a five percent drop. We opened it around three percent drop. We bounced up, we bounced down. But it's all chaos. We're going to try and figure it out. We're bringing a bunch of people on who can talk about it, bringing on some VCs, bringing on some founders, learning about what they're doing.

• 1:44Jordi Hays?

  When you need an expert on any, anything related to complex geopolitics.

• 1:51John Coogan?

  Yes, yes, yes.

• 1:53Jordi Hays?

  Macro, you gotta go to early stage private market investors.

• 1:56John Coogan?

  Exactly.

• 1:57Jordi Hays?

  And get the truth.

• 1:58John Coogan?

  Yeah, get the truth.

• 1:59Jordi Hays?

  And so that's what we're going to be doing today.

• 2:00John Coogan?

  We're going to be doing, uh, but if you're trying to trade the market while it's up, while it's down, you're trying to buy the VIX, you're trying to go short, buy some puts, buy some, buy some options, go long, whatever you want to do, do it on public.

• 2:11Jordi Hays?

  That's right.

• 2:11John Coogan?

  Investing for those that take it seriously, multi asset investing.

• 2:14Jordi Hays?

  And many people have been saying-

• 2:15John Coogan?

  And trusted by millions. And literally, like, like, if you're bearish right now in the stock market, you should put your money in bonds, right? Like, that's, that's pretty basic. And there's no better place to do it than on public-

• 2:25Jordi Hays?

  Not financial advice, but-

• 2:26John Coogan?

  That's not financial advice, but you can express your opinion about the market anywhere, and there's no better place to do it than on public-

• 2:31Jordi Hays?

  One of the crashouts from the weekend-

• 2:32John Coogan?

  Yep.

• 2:33Jordi Hays?

  Was the Ackman, Bill Ackman-

• 2:34John Coogan?

  Yep.

• 2:35Jordi Hays?

  Uh, going off on, on, uh, Lutnick-

• 2:38John Coogan?

  Yep.

• 2:39Jordi Hays?

  For being long bonds.

• 2:40John Coogan?

  Yep.

• 2:41Jordi Hays?

  And so, uh, you know, pick your, pick your hero-

• 2:45John Coogan?

  Yeah.

• 2:46Jordi Hays?

  And, uh, do your thing.

• 2:47John Coogan?

  Yeah, it was got, it, it got spicy on the timeline. Lots of back and forth. We're gonna dive into it, but I wanted to start with, uh, Ben Thompson on St. Tecker. He's back from vacation and not a moment too soon. Uh, he gives a good breakdown of the history here. I think we should dive through this, because I think it's very, very interesting. Um, so he says, "Pretend if you can that last week didn't happen. Uh, and imagine another scenario, China invades Taiwan. What happens then?" Says he's not a military expert, but his assumption is that Chinese, to China would be successful. The biggest unknown variable would be time. If the US does not intervene, the conflict will be shorter, but if the US does intervene, uh, the conflict will be longer and ultimately decided in a way that wars are always decided through industrial capacity. And that's something

• 3:30John Coogan?

  we've been talking about on the show a lot. We actually have an announcement from Anduril today, and a folk, and a, and a friend from Anduril coming on the show to talk about it. Um, it's all about just how many drones can you produce? How many bullets can you produce? How many ships can you produce? That's the way these wars are waged.

• 3:44Jordi Hays?

  And then actually getting them across the country.

• 3:46John Coogan?

  Yep.

• 3:46Jordi Hays?

  Or not the country, in this case, the ocean.

• 3:48John Coogan?

  The ocean, yeah. Uh, China, China has a meaningful advantage in both areas, given its relative manufacturing might and the fact that it would happen off their coast. They can make stuff right there and just send it on over. Uh, there are experts who disagree, um, and concluded that, uh, the US would, would repel a Chinese invasion, but at a heavy cost to US military forces and Taiwan generally. And it's crazy to think about that actually happening. Let's hope that does not get there, because it'd be very, very disruptive to the global economy and everyone involved. Um, but Ben Thompson says it would raise a more pertinent point. When it comes to the economic impact, it hardly matters who wins or loses. In both cases, China is effectively removed from some, from global supply chains and Taiwan's economic output, including chips from TSMC and others. That would all be destroyed.

• 4:33John Coogan?

  It's difficult to overstate the extent to which every aspect of modern life rests on global supply chains, whether you like it or not, which are so long and complex that no one truly understands the effects of messing with them. It has often, however, gotten easier to grasp the complexity in recent years. First, there was the bungled economic response to COVID, where the temporal interruption in supply chains triggered worldwide supply shortages and contributed to global inflation. You remember, like, you couldn't get a car. And it's like, what does this have to do with washing my hands? But it's like, oh, well, like, actually, if you're locked down, there's trade, and like, you can't get the chips in the car, you can't make the car.

• 5:08Jordi Hays?

  Yeah, and it's fascinating, the dealer markups that you saw during COVID are basically back, but now, if the tariffs go out, you'll be paying that markup directly to Uncle Sam, effectively.

• 5:20John Coogan?

  Yeah. And so, he gives a little bit of history. Last November, in the wake of President Trump's second election, he wrote "A Chance to Build," obviously playing off of Marc Andreessen's "A Time to Build" essay. That title referenced the optimistic conclusion to a piece that was, if you read closely, a pretty pessimistic summary of the current trade situation with a special focus on tech. To summarize, "The US leveraged foreign aid direct investment in its consumer market to rebuild Europe and Japan after World War II, and pegged currencies to the US dollar, which was pegged to gold to do it. This started the cycle of foreign countries exporting to the US and buying US debt with the proceeds.

• 6:01John Coogan?

  Although the US's relative size to the rest of the world meant that the US still ran a trade surplus. By 1971, the system was about to collapse under its own weight, leading the US to de-peg from gold, depreciate the US dollar, and dissolve the Bretton Woods system of currency controls. This led to a decade of pain, including the oil shock of the 1970s. But what emerged had a similar structure to the post-World War II system, with the US dollar as the reserve currency untethered from gold." And this was fascinating. I was digging into this this morning. I think a lot of people don't understand the rationale for getting off the gold peg. It's actually pretty intuitive if you walk through it.

• 6:42John Coogan?

  So basically, what happens is gold is fixed. Like, there's not, there's not a growing amount of gold. So if you, if dollars are pegged to gold, you can't have a growing monetary supply of dollars. Now, why is that a problem? Well, when, when the entire global economy is bringing new resources and goods online, like, they are discovering more coal and more oil and more trees that they're turning into furniture, and they're creating more value-added goods, the economic value of that is all, is all going up. Now, what does that actually mean in practice? You would, you would think it's like with Bitcoin, you know, you just use smaller and smaller fractions of Bitcoin, right? But when you have, when you have, when you have prices denominated in dollars that are pegged to fixed gold, what happens is that prices are going down over time.

• 7:27John Coogan?

  And so you have deflationary pressure. And so as a consumer, you're like, well, why would I buy this car today? It's gonna be cheaper in a month. And so you just don't buy it. And so you, there's less. Doesn't stimulate the economy. It doesn't stimulate the economy. And so it seems like stupid because you're just like, why wouldn't we just fractionalize it? Like, a thing that costs a dollar, we have pennies. But really, it's like, well, if the, if the true price is going down, down, down constantly, people won't hire because they'll be like, oh, I could pay less tomorrow. And so you've always wanted like maybe flat prices or maybe a little bit of inflation, but deflation can be very dangerous. And so that was the alternative. Now, a lot of people say, oh, 1971 was terrible, is this like awful moment? And a lot of things like stagnated after the fact.

• 8:09John Coogan?

  And I think all that's legitimate, but I totally now understand the rationale for breaking that peg, which I didn't before. This meant that there was inelastic demand for US treasuries, meaning that because of the trade system, no matter where the US priced the treasuries, they'd be like, oh, yeah, like, we want to issue a billion dollars of debt at 0%. People would be like, great. Inelastic demand, people will buy at any price, basically. And so this basically made it impossible for the US not to run a deficit, either in terms of trade or the federal budget, because there's just so much money flowing into treasuries, because you have the lowest rates and you're the global reserve currency. Still, this was maintainable, given the size of the US economy to its trading partners.

• 8:52John Coogan?

  So basically, you have a bunch of small countries that are just like buying your debt at any price and hoarding dollars and just like, it's all good stuff, because it's a bunch of like, you know, small little minnows that are like, just kind of doing like, helpful things around the edge, basically. That's the way I think about it. But then he goes into China, which is obviously a much different dynamic, and he says-

• 9:13Jordi Hays?

  Yeah, so I can read this. "China is the skeleton key to understand so many oddities about the US's fiscal situation over the last 15 years, in particular, how it is that the US's response to the Great Recession didn't lead to inflation. Chinese production was deflationary, and their ever-expanding trade surpluses created an ever-expanding market for US debt, whether it be held by the Chinese national government, provincial governments, state-owned enterprises, etc. This inelastic demand also served to keep the dollar artificially high in defiance of the theoretical expected response to a long-running trade deficit."

• 9:47John Coogan?

  Yeah, so if you have a long-running trade deficit, you'd expect that to kind of damage your economy, but because there's just so much more demand for the dollar and for US debt, the musics never stopped playing, basically. "This, more than anything else, is what hollowed out US manufacturing. The cost of cheap consumer goods and seemingly inexhaustible capacity for US debt was shifting far. Ever more manufacturing abroad. Yes, things like lower costs and different labor standards played a role, but the structure of the world economy is what matters most. Indeed, China's labor costs are significantly higher than they used to be, but China's manufacturing dominance is actually exciting, which I think is a very interesting take."

• 10:29Jordi Hays?

  Yeah, and this next part is key. So, "Part of this is due to China's decision over the last few years to respond to the puncturing of its housing bubble by pushing resources into export-oriented industries. Another part is the unfortunate reality, underappreciated by apostles of comparative advantage, that capabilities compound." Meaning that China is just getting better and better and better at manufacturing because they're doing so much of it.

• 10:52John Coogan?

  Yeah, yeah, a lot of the comparative advantage, like examples in macroeconomics.

• 10:58Jordi Hays?

  You were gonna say comparative advantage bros?

• 10:59John Coogan?

  Yeah, comparative advantage bros, like they'll tell you it's like, well, I make, you know, you make shoes and I make hats and we could both make shoes or hats at any time, but I make shoes slightly more efficiently than you make hats, so I'll make the shoes and you make the hats and we'll trade. And it's like, yeah, that's true, until we get seven iterations of the global supply chain deep and all of a sudden we're using mirrors that are flatter than anything that's ever been created to bounce like tin and liquefy tin and create like silicon transistors that are like so complex, you can't just be like, oh yeah, well, we do have like, you know, Ford is still here, let's just turn Ford Motor Company into TSMC. It's like, that's not gonna happen anytime soon.

• 11:43Jordi Hays?

  Or, or the reality where I'll design the shoes, you make the shoes, and we'll just do that forever and we'll live in peace and harmony and then eventually says, well, actually, I'm gonna design the shoes and I'm gonna make the shoes.

• 11:56John Coogan?

  Yep.

• 11:57Jordi Hays?

  And then I'm gonna still expect you to buy them, but I'm also gonna do that for, you know, you design drones and I'll make the drones. And then eventually it's, well, actually, I'm gonna design and make the drones now. And then you get into sort of some type of, you know, conflict and things devolve.

• 12:13John Coogan?

  Yeah.

• 12:13Jordi Hays?

  Which has been the big, you know, one of the big reasons for reassuring.

• 12:18John Coogan?

  I'll make the gun and you feed.

• 12:19Jordi Hays?

  John, put away the squirt guns.

• 12:22John Coogan?

  I'll make a gun and you.

• 12:24Jordi Hays?

  Put away the squirt guns, John.

• 12:26John Coogan?

  You make the food and you're gonna pay what you, what I ask.

• 12:29Jordi Hays?

  We're gonna confiscate the squirt gun.

• 12:31John Coogan?

  Anyway, very interesting story from Steve Jobs here, meeting with Barack Obama and advocating for kind of reindustrialization.

• 12:41John Coogan?

  Jobs is the original reindustrialization brow, basically, you know? He would have been keynoting it.

• 12:45Jordi Hays?

  He would have loved 2025.

• 12:47John Coogan?

  For sure. So basically, Obama and Jobs get dinner sometime. It was, it's from the Steve Jobs biography by Walter Isaacson. So it must have been in the early 2000s, like 2008, 2009 timeframe. But Jobs goes to Obama and says, hey, we, we, we have 70,000 factory workers in China. And we need 30,000 engineers onsite to support those workers. You just can't find that many to hire in America. These don't have to be PhDs or geniuses. They just need to have simple, basic engineering skills for manufacturing. Tech schools, community colleges, trade schools could train them.

• 13:31John Coogan?

  We've got to find a way to train these 30,000 manufacturing engineers. And so basically, Steve Jobs keeps pitching Obama like, hey, let's bring manufacturing back. We can do it, but it's a skill issue. And Obama keeps telling him all these different ways that like legally it's impossible to do. And they just get very frustrated. And so Obama basically says like, hey, the only way we could do this is with the dream act.

• 13:57Jordi Hays?

  He's not historically been too worried about, about what the rules say, you know?

• 14:04John Coogan?

  And so Jobs finds this annoying and it's an annoying example of how politics can lead to paralysis. The president is very smart. He said, he kept explaining to us reasons why things can't get done. It infuriates me. And then Ben Thompson goes on to say, I think Jobs had cause and effect backwards, though. There's not 30,000 manufacturing engineers in the US because there aren't 30,000 manufacturing engineering jobs to be filled. And that's because of the structure of the world economy. And so what Ben Thompson, I think, is getting to here is this idea that it's like, yes, you could go bottom up. And say, let's, let's create more schools, the train more engineers. And then the, and then companies will say, hey, actually it is doable to, to, to build here.

• 14:49John Coogan?

  But maybe you need to go top down and start with the trade dynamics and the structure of the global economy. And so he goes back in time and looks at what happened with Nixon and goes back to that 1971.

• 15:01Jordi Hays?

  Yeah.

• 15:02John Coogan?

  Ending of the Bretton Woods situation and says, uh, uh, this, this all started with Nixon. Closed the gold window instituted price controls, very controversial and imposed a 10% import tax. And it's very interesting because with the Nixon example, the, it was a PR masterpiece and the market loved it. But it was later was like, like a later analysis kind of shows that it was like extremely chaotic and like not great for, you know, kind of flipping the table.

• 15:33Jordi Hays?

  Easier to control the narrative when there was newspapers, television, radio and official.

• 15:40John Coogan?

  Yep.

• 15:40Jordi Hays?

  Wires going out of the White House.

• 15:42John Coogan?

  Yeah. And so that's exactly what they did. Like the Treasury Secretary, John Connally at the time, packaged the whole program, this new deal, this new structure that they were going to roll out as America. We weren't abandoning the commitment to the gold standard, which again, like America had said, like we're, this is a commitment. Basically like we're going to exchange dollars for gold one to one. But this is America taking charge. He turned the dollar's collapse, which could have been, appeared shameful into a moment of hubris. The emphasis would be on righting America's trade balance as well as minor points, such as a 5% cut in foreign aid. William, an aide to William P. Rogers, the Secretary of State called and interjected, you can't cut foreign aid. Connally said, tell him if he doesn't shut up, we'll make the cuts 15%.

• 16:25John Coogan?

  Aggressive. Schultz muzzled his disquiet over price controls. Even Burns joined ranks. The group feverishly debated whether, whether Nixon should address the country on Saturday, on Sunday night, which would mean preempting the popular show Gunsmoke, which I've never heard, but I guess it was like what everyone, it was the all in of the day.

• 16:41Jordi Hays?

  So, so wild. I mean, yeah, last night we had White Lotus.

• 16:45John Coogan?

  Yeah.

• 16:46Jordi Hays?

  And many people were hoping that Trump would make some type of announcement over the weekend. It didn't come. I think he didn't want to disrupt White Lotus. That was probably it.

• 16:54John Coogan?

  Probably. And so, uh, the public relations aspect was paramount. Stein wrote later that the discussion at Camp David assumed the attitude of script writers preparing a TV special. No one pretended to know how controls would work. The question was scarcely debated. Addressing the nation on Sunday, Nixon blamed currency speculators and unfair exchange rates rather than US monetary policy. Politically, he hit the jackpot. Wow. Monday's rise in the Dow was the biggest ever to that point. Nixon's new economic policy drew raves from the press. The New York Times said, "We unhesitatingly applaud the boldness with which the president has moved." What a throwback. You don't hear that about today's stuff. Yeah.

• 17:39John Coogan?

  Only from like a very few people, a very small cohort of supporters. In the present era, America's inability to repair its fiscal problems tarnished its credibility and hampered currency negotiations with China. So, the end of Bretton Woods was probably inescapable, but it's worth pointing out that the Nixon shock was an economic disaster. The country endured a decade of drastic inflation. This is like the stagflation era where we weren't really growing, but there was a lot of inflation. And this was only cured with sky-high interest rates. I think the interest rate got up to like 15 or 17%. Mortgages were super expensive. Just think about how painful that would be. We've, you know, we've lived with like, oh, high interest rates are 8%. It's like, it can be so much worse. And there was a massive recession. Volcker, Paul Volcker, was the guy who instituted the

• 18:24John Coogan?

  shock. He was on the team with Nixon. Then he cured it, and then he became the chairman of the Fed, I believe, later, or the Treasury Secretary later. In other words, the reaction of the market and the press was totally wrong. And so, I think what Ben Thompson here is getting at is like, it's possible that this is happening again, and you need to at least consider that both the reaction from the press and the market could be wrong. I'm not 100% on board with that, and I don't think even he is, but it's a very interesting, like, historical example to pull from, just to, because it's very easy to say, okay, you know, the media hates this, but of course they do because they don't like Trump. And Trump says it's great, but let's go to the market, because the market's always right.

• 19:09John Coogan?

  And, but the market was wrong then, and so maybe that's the case here. It's very interesting. I still don't exactly know where I sit with it, but that's why we're doing this show, and that's why we're talking to so many folks today, to hear different points of view. The question is, if what happened last week...

• 19:24John Coogan?

  ought to be compared to the Nixon shock or contrasted. Certainly, the reaction is a contrast. Everyone hates Liberation Day tariffs, including the market. And we saw like Tyler Cowen's post. He's coming on the show next week. You know, Tyler Cowen had 25 bullet points. It was stupid and a lot of them were very convincing. Moreover, the Trump administration's rollout has been the very opposite of a PR masterpiece. No one in the administration can seem to agree about what exactly the goal was or what success looks like. And then even today, there was like a leaked story that they might go back on them. And then the White House had to come out and say like, no, we're not going back.

• 19:58Jordi Hays?

  Well, it wasn't a leaked story. It was somebody, one of those big accounts that shares the breaking headlines. Walter Brom, Bloomberg.

• 20:06John Coogan?

  It's like a fake, fake account.

• 20:08Jordi Hays?

  Yeah. Took somebody asked a question on CNBC that said something to the effect of, will, will, you know, President Trump, you know, putting a 90 day? And he just was like, boom, hit, he hit the timeline with it. President Trump considering a 90 day, you know, temporary pause on the tariffs.

• 20:29John Coogan?

  And it actually moved the market because the market jumped 5% and then went down another 5%.

• 20:34Jordi Hays?

  We were in the gym and we looked at our phones and we thought, wow, we might be back. And then we, in fact, were not back.

• 20:43John Coogan?

  Yeah, I, I really think, you know, this is the technology business production network. And I do think that the fact that the technology comes first is important. Like this is a very important story. This is a business story. This is a finance story. There's some politics in here, of course. It's important for everyone to understand, but I want to get back to talking about tech so badly. Like Friday's show was amazing, talking about AI and that stuff's just way more interesting to me. But this stuff's, this stuff's very important. So we will, we will go through it and cover it. So what Ben Thompson comes back to and what he opened with is that there is a scenario within the realm of possibility that is far more painful than anything Trump proposed. Is it better to try and force into place a new economic system that in least, at least

• 21:25John Coogan?

  in theory, reduces dependency on China and resuscitates US manufacturing now instead of waiting for the current system to collapse by literal force? This does. Seem to be the administration's goal, simply terrifying, simply tariffing China is dead weight loss, leading to rerouting and the fundamental problem of the dollar as reserve currency unaddressed. Blanket tariffs, on the other hand, are a valid, if extremely blunt and inefficient way to meaningfully re-instruct, re-structure incentives. And so we've seen this with, you know, this, e- even before there were major tariffs on China, there, there was just like a, there was just a rational business decision to say, hey, maybe you don't want to be 100% indexed on China for a variety of reasons. And so, you know, we saw even Apple, they make AirPods

• 22:08John Coogan?

  in Vietnam. Well, now they really have to consider what can they do to make products in America? And the economic equation is like, yeah, if it's going to be 30% more, like, that could be meaningful over a long period of time. And the thing that I keep coming back to is like,

• 22:27John Coogan?

  the market is in turmoil, it's dropped like, like 15%, and I do really feel bad for everyone that's lost money. And it is, it is, it is very serious. Like, I, I do think that there are like Main Street people with pensions and all sorts of retirement funds. And like, it is, it is very harmful. It is very bad. But there is a world where you build that back up in the markets pretty quickly, because you get a new AI narrative, or you get something that like, everything ramps, or interest rates go down. Like, I've seen 15% gains in a couple of months, right?

• 22:57Jordi Hays?

  It still comes back to Nvidia earnings.

• 22:58John Coogan?

  But if, but if this like, 50%, 25% tariff, like, if this new tariff regime sticks around for years, like, that will actually

• 23:06Jordi Hays?

  Yeah.

• 23:07John Coogan?

  in-form and change business decisions.

• 23:09Jordi Hays?

  There is, there is a general feedback from the market and from people online that they're saying that, they're saying it's a bad idea after looking at the market's reaction in a couple days. And what Ben Thompson is saying here, Is that basically we're going to need to judge this in the fullness of times like yes, the rollout was poor. Yes, the market hates it today, but if we're avoiding something that would have was bigger and more spectacularly terrible than it actually could be worthwhile. It's funny to contrast it to to Bretton Woods and Nixon's rollout because again, like you said,

• 23:51Jordi Hays?

  the market liked it, but then it ended up being bad. And so, you know, short term market movement is not necessarily always going to be an indicator for long term success or viability of policy.

• 24:05John Coogan?

  Yeah, yeah, it'll just be it'll just be very important to follow like where this actually goes. And I think one of the interesting I kept I kept coming back to like, okay, if I'm being like cautiously optimistic about this stuff, it feels like I would say like high risk, high reward, maybe, or high risk, medium reward is kind of as I was thinking like high risk, high rewards kind of the natural thing. But then I was thinking about it, I was like, well, the the high reward is really like, we slowly build up industrial capacity and GDP grows a little bit. It's not really like, oh, all of a sudden, we just like win everything in America's like amazing. It's like, no, we're like on a slightly better trajectory. So I would say that's like medium reward. But then I was thinking like, is it really high risk? It's like, well, part of the

• 24:46John Coogan?

  problem here is that and it's not really high risk, because if it gets really bad, he can just say with the stroke of a pen, like, it's it's over, like, I'm rolling it back. Like, he could do that. And so the downside risk feels not so bad as opposed to like,

• 25:02Jordi Hays?

  The question is what breaks during the negotiation period, right?

• 25:06John Coogan?

  Totally. But like, but like, previous crashes were very much out of the control of the president, where, you know, in the dot com crash, it's not like the president could go out there and say, like, actually, Yeah, AOL is worth the trillion dollars or whatever, right? Or like COVID, like, cause actually like

• 25:23Jordi Hays?

  I'm leading around a day AOL at 200, 200 times revenue.

• 25:27John Coogan?

  Yeah, yeah, exactly. And so I don't know if we should close out with his conclusion and then move on to the timeline because we have about 20 minutes.

• 25:33Jordi Hays?

  Yeah, the, the one thing that comes to mind and we'll probably get into this in the timeline, but so Chamath was doing quite a bit of lying over the weekend. He kept getting caught lying. The internet was being very diligent, but one thing he's posted, which I did notice is he's been orienting the narrative around the Mar-a-Lago Accords.

• 25:51John Coogan?

  Yes, yes, yes.

• 25:52Jordi Hays?

  And so this entire time, to be clear, David Sacks has been silent, JD Vance has been silent. But the sort of the Mar-a-Lago Accords, right? So, so if Trump is the deal guy and he lives to do deals.

• 26:05John Coogan?

  Yep.

• 26:05Jordi Hays?

  And he did every deal there was to do in sort of business and crypto and social media, you know, and, and real estate or whatever. And the final deal is like the new, you know, the new sort of backbone for the global economy. Then, and, and normally I would discount what Chamath would say, but because he had that call on bonds earlier, you remember, you were talking about this where he was like

• 26:30John Coogan?

  For default swaps.

• 26:31Jordi Hays?

  Yeah, right, right, right.

• 26:35Jordi Hays?

  I think it's totally possible that, that there's a lot that the administration could be angling towards that they're not able to really talk about. But I believe that Chamath would leak it basically in order to try to basically position himself, be like, I called this.

• 26:49John Coogan?

  This is a very, so, so we invited Chamath on the show, hopefully he'll be able to join.

• 26:54John Coogan?

  I don't know what he'll be able to say. It is interesting because he, he does not, to my knowledge, have an official position in the administration. But he obviously is extremely close with David Sacks, who does have a position in the administration. And Chamath has been to, you know, all these different organizations and events and like, he's clearly tapped in. And so if you think about like, hey, we need to like send out some messaging, but it can't really come from us. Like having Chamath post messaging might make sense.

• 27:23Jordi Hays?

  Regardless of how you feel, regardless of how anybody, any one person feels about Chamath, he has a huge following right now.

• 27:31John Coogan?

  Yes.

• 27:31Jordi Hays?

  Among a bunch of major investor types.

• 27:34John Coogan?

  Yep.

• 27:34Jordi Hays?

  And even if they don't respect everything he says or

• 27:39John Coogan?

  They should be reading into what he's saying.

• 27:40Jordi Hays?

  Yeah.

• 27:41John Coogan?

  Because he does have information.

• 27:42Jordi Hays?

  Based on his position.

• 27:43John Coogan?

  Yeah. Yeah, so. It's very, very interesting. I don't know.

• 27:48Jordi Hays?

  Yeah, he's also had, he's been interviewing Lutnik and Besen and everybody. Obviously, I imagine they're having conversations on air. They're having conversations on air. They're certainly having this similar conversations off air as well. So.

• 28:04John Coogan?

  Yeah, I mean.

• 28:05Jordi Hays?

  Who knows?

• 28:07John Coogan?

  You should go read the full Ben Thompson piece. You can go to stratechery and sign up. It's in the everyday carry of every tech person, in my opinion. He closes with a couple of interesting conclusions. There's some, there's some knock on effects. Apple's services business is not subject to tariffs, which is to say that it will become even more important to Apple's bottom line. That decreases the likelihood that Apple transforms its relationship with developers, which is the most, which he thinks is the most promising opportunity for AI.

• 28:34Jordi Hays?

  Couldn't Apple like really flip their model and make it so that it was like $200 for the software? And like they basically give you the hardware for free?

• 28:43John Coogan?

  Well, they're basically doing that. If you've looked at the price of the iPhone on an inflation adjusted basis, it's not going up by as much as it should. And it's, it's held very steady because they make so much money off of services. I mean, you get a new phone and there's like 25 different calls to action to buy like Apple Health, Apple News, Apple App Store stuff. Subscribe to this, Apple TV plus, and then also every app they get 30% of. And, and, and that's why they're not giving up the Siri button, even though it would make so much sense. It's because like, yeah, this button is going to be auctioned for a trillion dollars, basically. Opening has got to pay probably, something like that, because this button is going to be the next Google.

• 29:22John Coogan?

  Like when you go to Safari and you type in just, you know, like restaurant near me, it goes to Google and Apple gets paid for that. It's going to be the same thing with the hardware button here. But it would be a lot cooler if it was more of a free market for that button and for the ecosystem. And certainly it seems to be stalling the Apple Vision Pro with developer hesitation. There's a lot of stuff there. And then they also have some interesting takeaways on the advertising based businesses. Meta, Google, Amazon will also be negatively impacted. Lots of cheap products mean lots of advertising, much of which could disappear. Could this mean a return of app install advertising, like mobile games? If e-commerce advertising decreases, lowering prices overall, we got to get Sean back on the show from Ridge Wallet to give us the breakdown

• 30:05John Coogan?

  of how, how people are thinking about this in e-commerce after all this settles.

• 30:11John Coogan?

  But, you know, so what is my optimistic spin? So what of my optimistic spin last November? When I called my tariff preview a chance to build? Well, my skepticism is keeping with the pessimism embedded in that piece. It's a lot easier to build from scratch than to retrofit something that exists that applies to companies just as much as countries, economic orders. I'll be cheering for the startups that seize this opportunity. I'm sympathetic to incumbents looking at guaranteed costs with very uncertain rewards. Rough. Well, if you're feeling upset about the tariffs, you should just treat yourself to a nice weekend on Wander.

• 30:49Jordi Hays?

  That's right.

• 30:49John Coogan?

  Go to wander.com and find your happy place.

• 30:51Jordi Hays?

  There's no tariffs on Wanders.

• 30:53John Coogan?

  That's true. Book a Wander with inspiring reviews, hotel-grade amenities, dreamy beds, top-tier cleaning, and 24/7 concierge service. It's a vacation home, but better, folks.

• 31:02Jordi Hays?

  Do it. Code TBN.

• 31:04John Coogan?

  Industries. They launched Copperhead, Andorl's high-speed, software-defined family of AUVs. The US and its allies need scalable autonomous subsea weapons that can be rapidly deployed to meet the demands of modern naval operations. And yeah, it looks like a torpedo. It's pretty amazing, except it's square. So I want to know about that. They seem to be taking everything that's round and making it square. Have you seen the ghost shark, their submarine?

• 31:29Jordi Hays?

  Ghost shark. So cool.

• 31:31John Coogan?

  Yeah, it looks really cool.

• 31:32Jordi Hays?

  Looks like a VW bus.

• 31:33John Coogan?

  And I think that's because it's easier to transport and you can stack them and stuff and put them in. But I don't even know. I asked one of the Andorl guys and they were like, I don't know why it's square. They were like, ask one of the engineers, you idiot.

• 31:48Jordi Hays?

  Well, we can ask Shane.

• 31:49John Coogan?

  That's the first question I would ask. If he doesn't answer it, I'm going to be like, man, it's a mystery. But it looks really cool. Copperhead is built for speed, ready to carry advanced payloads, and integrates seamlessly with autonomous systems. The first two models, Copperhead 100 and 500, offer different payload capacities and ranges for commercial and defense. Our munition variant, Copperhead M, equips autonomous vehicles with torpedo-like capabilities at a fraction of the cost. Critically, it's mass-produceable. And so, yeah, this is one of the beneficiaries of tariffs and trade war, more defense, more manufacturing in the United States. And it's odd that this is where, this is the most high-tech, this could be the most high-tech product made in America, when you think about it, in terms of like, AI, is this thing more complicated than an iPhone to manufacture? Like, maybe. It's up there.

• 32:32Jordi Hays?

  Yeah, it feels like American manufacturing really comes down to having...

• 32:39Jordi Hays?

  Vision, incredible willpower and incredible ability to recruit.

• 32:43John Coogan?

  Yep.

• 32:44Jordi Hays?

  Amazing talent because Elon's done it.

• 32:46John Coogan?

  Yep.

• 32:47Jordi Hays?

  Anduril's doing it. It clearly is possible.

• 32:50John Coogan?

  Yep.

• 32:50Jordi Hays?

  But it takes incredible power effectively.

• 32:56John Coogan?

  Yeah, it's also interesting that we're kind of going maybe in reverse here, like in World War II. We had all this industrial capacity from the automobile industry. Ford and Chrysler wound up pivoting and making tanks. And there was, I think, a Ford manufacturing plant that was pivoted to making bombers. And it took them three years. And here, I think the good ending is like Anduril secures the global order. And then, hey, it's time for you guys to make some iPhones.

• 33:24John Coogan?

  Like, you guys got all the best engineers. We want you to just make some consumer drones. And we kind of joked about that, where it's like, hey, they make all these drones. They keep us safe, but then, I still want an FPV drone to fly around.

• 33:34Jordi Hays?

  There definitely is a Tesla mafia, right? Like, the CTO of deterrence, we had Drew on the show a couple of weeks ago. He worked in manufacturing at Tesla, specifically on their battery cell side. Now he's working in defense, right? And so we just need winners to win and then distribute out talent into other industries.

• 33:59John Coogan?

  Well, speaking of talent, Anduril ran a great advertising campaign for, don't work at Anduril, trying to weed out all the folks who don't believe in their mission. And they bought a bunch of billboards. So if you're looking to buy billboards for your company, build your culture, go to adquick.com.

• 34:16Jordi Hays?

  John, it's out of home advertising made easy and measurable. Did you know that?

• 34:19John Coogan?

  No, thanks for letting me know.

• 34:22John Coogan?

  Would it be possible?

• 34:22Jordi Hays?

  Really? I'm hearing, you're hearing that for the first time?

• 34:25John Coogan?

  Because I have a lot of headaches about out of home advertising.

• 34:28Jordi Hays?

  Yeah.

• 34:28John Coogan?

  Would I be able to say goodbye to those?

• 34:30Jordi Hays?

  Yeah, you could say goodbye to them.

• 34:31John Coogan?

  That'd be great. I'd love to say goodbye to the headaches of out of home advertising. Only AdQuick combines technology, out of home expertise and data to enable efficient, seamless ad buying across the globe.

• 34:40Jordi Hays?

  That's right.

• 34:41John Coogan?

  Anyway, should we review this Chamath post to kind of give some context on his position?

• 34:50John Coogan?

  My current best view.

• 34:52Jordi Hays?

  This is just one position.

• 34:54John Coogan?

  This is one, this is one position. He says, Trump lets tariff reactions play out for the few weeks, sees the trend of capitulations and is emboldened to keep going. He fields offers from everyone, negotiates with no one, then brings everyone to Mar-a-Lago in a month or two and puts an offer on the table. Bretton Woods 2.0. It's simpler and more effective to have one grand bargain than negotiate piecemeal with 80 countries plus. I am focused on figuring out what terms matter most for the MAL Accords, Mar-a-Lago Accords. I have a few in mind that are, which are obvious and would king make the US. I don't buy the whole end of US hegemony. This is the moment to go for the jugular and establish world order around America. So he's very optimistic that this ends well, but we will see.

• 35:40John Coogan?

  Uh, who else should we cover from the timeline? Cause the timeline's been in turmoil. This, uh, the Walter Bloomberg pump occurred from 10:13 a.m. to 10:48 a.m.

• 35:51Jordi Hays?

  It was glorious.

• 35:53John Coogan?

  Joe Weisenthal documented on the timeline to the tune of 7,000 likes.

• 35:58Jordi Hays?

  You have to wonder, could this have been, you know, the, the default is that it was just a total accident. He just like wanted to be the first person to post. I don't, I don't know who runs the account.

• 36:09John Coogan?

  Yeah, yeah.

• 36:09Jordi Hays?

  Somewhat anonymous, but it's totally possible this was like coordinated, right? These accounts don't monetize well, like the, the ad rev, the ad revenue that he gets from, you know, posting headlines is probably like $3,000 a month.

• 36:22John Coogan?

  Sure, sure, sure.

• 36:23Jordi Hays?

  So it's just like, not super meaningful hedge fund, you know?

• 36:28John Coogan?

  I don't buy it. I think it's just accidental.

• 36:30Jordi Hays?

  Accidental.

• 36:30John Coogan?

  I think it's just somebody just.

• 36:31Jordi Hays?

  I'm just saying like you have to, it was such a, yeah, yeah, yeah. I'm saying the default, the default.

• 36:36John Coogan?

  Yeah.

• 36:37Jordi Hays?

  Is that it was just an accident.

• 36:38John Coogan?

  Yeah, yeah.

• 36:39Jordi Hays?

  But it could have absolutely been.

• 36:42John Coogan?

  The funny thing is that you, I mean, you mentioned hedge funds. For some hedge funds, it doesn't even matter because they just see the trading volume go up and they make a whole bunch of money during volatility. Like, like I'm sure Jane Street printed during this pump on both directions, right? Uh, insane market action right now. Market exploded on a headline attributed to Kevin Hassert. And now nobody can figure out where it came from and the markets are diving again. An 8% surge and then a 3.5% plunge in a matter of seconds. Anyway, you want to make sure that your expenses are plunging with ramp.com. It's time is money. Save both.

• 37:14Jordi Hays?

  Just do it.

• 37:15John Coogan?

  Corporate cards, bill payments, accounting and a whole lot more all in one place. Go to ramp.com. We like this DJ Kau's post.

• 37:22Jordi Hays?

  I want to have ramps head economists.

• 37:24John Coogan?

  Or Karasian.

• 37:25Jordi Hays?

  Are on the show.

• 37:27John Coogan?

  Yes.

• 37:27Jordi Hays?

  Uh, I think it'll be next week at this point, just to break down what they're seeing across the ramp ecosystem.

• 37:34John Coogan?

  Yeah, I like these leading indicators. There's this whole idea of like, you know, the market is a leading indicator. It'll eventually show up in GDP, but there's a lot of things in between that we want to look at. Like venture flows and what's, what's going on on angel list and, and are funds sizing up or sizing down during the SVB crisis? We saw a lot of VC funds pull back. Are we there yet? Are we even getting there? And then what are consumers and businesses doing? Our Karasian breaks it all down in his economic reporting from ramp and has fantastic data. Let's go to DJ Kau's. The market crash looks so much nicer in Ghibli. This is a ridiculous chart. This can't be real. I mean, maybe, maybe this is if you zoom out enough. It's really steep though.

• 38:18John Coogan?

  I think it might've taken some, some liberties. In fact, at the end, it looks like it's going backwards in time. Not great.

• 38:24Jordi Hays?

  Looks a little dramatic.

• 38:25John Coogan?

  But some green shoots Nvidia is up 9%.

• 38:28Jordi Hays?

  There we go.

• 38:29John Coogan?

  939.

• 38:29Jordi Hays?

  There we go.

• 38:30John Coogan?

  I don't know if it stayed up.

• 38:31Jordi Hays?

  It's actually up 4.7% today. That is still down almost 9% over the past week. But um, we like, we like to see a little green.

• 38:43John Coogan?

  Yep. We got some news out of Taiwan. Taiwan does not seek retaliatory tariffs against the US. Instead, we'll start talking from bilateral zero tariffs to ensure Taiwan's competitiveness. We'll increase US, US imports and adopt other measures. Working together will usher in a golden age of shared prosperity.

• 39:06John Coogan?

  You'll love to see it from our friends over in Taiwan. Yeah, I mean, I think this is where everyone wants to get and but it's interesting. I was talking with a friend today and we were both kind of lost on like, you know, what is the tariff take? He was just saying, I just want less regulation like I want, I want this to, I want that to be the dividend.

• 39:25Jordi Hays?

  So Doug Demuro actually had a great take because he is in the automotive industry. Obviously, if you're in the business of selling new cars, you got to be really frustrated with the tariffs because Doug just compared it to the dealer markups that we saw during COVID. It just became really hard to make cars, move them around the world. And interest rates were super low, so people wanted to, you know, the market was ripping, right? You remember G wagons were like 350K for like a $200,000 car. And he basically.

• 39:58John Coogan?

  That's a steal, but.

• 39:59Jordi Hays?

  Yeah, still giving it away.

• 40:00John Coogan?

  Other examples.

• 40:02Jordi Hays?

  No, but he basically said, you know, the US was based around.

• 40:06John Coogan?

  The Hummer EV was trading for like 200K.

• 40:09Jordi Hays?

  Yeah.

• 40:09John Coogan?

  And now it's like down at 60.

• 40:11Jordi Hays?

  Where it should be.

• 40:14Jordi Hays?

  No, but he basically said, you know, the, in many ways, the US was like founded on this, you know, the ideals of like free trade and capitalism and letting, you know, the market do its thing. And, you know, tariffs are taxation. It's protectionism, which is like against like the entire ethos of like the United States was basically, at least looking back was like, let's win by being the best.

• 40:40John Coogan?

  Yep.

• 40:41Jordi Hays?

  Not, and so again, he's obviously biased from being in the automotive industry, but I think that's generally like tariffs being un-American is like generally.

• 40:52John Coogan?

  It's a good take.

• 40:52Jordi Hays?

  It's a good take.

• 40:53John Coogan?

  Yeah. I also, I was talking to a hedge fund manager. A year ago during the inflation crisis and he was talking about like, you know, when there's like too much money flowing around, you, you need a place for that to just like die. You need the money to die.

• 41:11Jordi Hays?

  You mean, stop moving?

• 41:12John Coogan?

  Stop moving, but just like, just like gets sucked out of the economy when the economy is like overheating.

• 41:17Jordi Hays?

  Yeah.

• 41:17John Coogan?

  Right? And so he was like taxes, like the IRS or like tariffs, which are a form of taxation is like where money goes to die. Because the money, instead of going into the pocket of like a business person that can like immediately deploy it, or even just a consumer, like a worker can go take the money and immediately deploy it. When it goes into the government, it's often used for like such, you know, like such inefficient means that.

• 41:40Jordi Hays?

  Yeah, like funding Sesame Street in Iraq.

• 41:43John Coogan?

  Yeah, that basically like it really, really slows down the economy. And, and so I, I think the, the Trump folks have been kind of signaling that like, okay, if this works and we're generating more money from tariffs, like we'll do a tax cut, which I think we'd kind of pare that down, but in general.

• 42:00Jordi Hays?

  We're gonna tax and then we're gonna.

• 42:02John Coogan?

  Cut.

• 42:03Jordi Hays?

  Cut.

• 42:04John Coogan?

  It's a tax cut. Increase taxes, increase cuts.

• 42:07Jordi Hays?

  Yeah.

• 42:08John Coogan?

  Tax cuts.

• 42:10Jordi Hays?

  We're simultaneously increasing and decreasing taxation.

• 42:14John Coogan?

  I mean, it's, it's, that's funny when you put it that way, but it is possible. It's just like, yeah, it, it, it's just like, you know, where, where does the money get taxed from? Where, where does it go to? You know, you can tax from a bunch of different places and you can cut from a bunch of different places. But Andrew Reid posted, so turns out the weeks where decades happen, happen a few times a decade. And I, I asked him, when's the new Sequoia memo dropping? Because Sequoia famously dropped the blacks, R I P. Good times memo at the end of the financial crisis or the housing crisis, which was a very detailed macroeconomic analysis of where the American consumer was and kind of calling upon all entrepreneurs to gear up for a very different market going forward.

• 42:59John Coogan?

  And then when COVID happened, they dropped the.

• 43:03John Coogan?

  A black swan memo, which was also very well received, telling founders, hey buckle up. Interestingly, the black swan memo was kind of like too soon because the market ripped. But a lot of those lessons were later applied very accurately to the SVB crisis. And if you were running a venture backed startup with 12 to 18 months of runway, coming into the SVB crisis, like you needed to move very quickly to know that, hey, you weren't going to raise another round in, I think it was 2022, 2023.

• 43:30Jordi Hays?

  Yeah.

• 43:31John Coogan?

  Things were getting rough. So you needed to buckle down and the companies that did made it through and the companies that didn't went bust. And so I'm sure we will see a lot of interesting takes from venture capitalists. We have some on the show today to break down what we think entrepreneurs should do. In this case, it's a weird scenario. It's, it's half, you know, wait and see right now. We're only a couple of days into the crash, but if this sustains and the GDP starts dropping, like you could see, even if you're selling B2B SaaS, people are saying, hey, I'm trying to tighten my belt, right? I'm trying to stretch my burn. I maybe VCs aren't going to fund me. Maybe there's going to be, you know, the requirements that we're just going to see less froth in the market. And so that requires a different type of management. Anyway.

• 44:14Jordi Hays?

  And it's such a fascinating time right now because it seems like all of the attention that artificial intelligence was getting, like just, you know, evaporated, right?

• 44:26John Coogan?

  Yeah.

• 44:26Jordi Hays?

  Yet if you're heavily in the industry and you're seeing the impact of it and you're seeing the power of it and you're seeing the progress it's making, even if it's, you know, maybe not, doesn't feel like it's quite accelerating, you know, maybe like it was six months ago. It's still, if you're in a private markets investor, you have to be extremely bullish on a number of new investment opportunities despite the sort of like macro backdrop.

• 44:53John Coogan?

  Yeah. I mean, speaking of, it is a fascinating time. And speaking of fascinating time pieces, you should go to Bezel, getbezel.com, shop over 24,500 luxury watches, fully authenticated in-house by Bezel's team of experts. And, you know, on a day like this, you just want to look down at a, at a fantastic time piece. And remember that things will always look up eventually. There's always a bull market somewhere.

• 45:15Jordi Hays?

  And Trump's a Vashron guy.

• 45:18John Coogan?

  Yeah.

• 45:19Jordi Hays?

  So I don't.

• 45:20John Coogan?

  Historique.

• 45:20Jordi Hays?

  Yeah, I don't expect the 31% tariffs on Swiss.

• 45:25John Coogan?

  To hold. That's gonna be the first one to fall.

• 45:27Jordi Hays?

  That's gonna be the first one to go.

• 45:28John Coogan?

  For sure. Okay, we got our first guest from Anduril. Shane's in the studio. Welcome to the show, Shane. How you doing?

• 45:36Jordi Hays?

  Boom.

• 45:37Speaker 02

  Hi, John. How's things?

• 45:39John Coogan?

  Uh, they're, they're good. You know, the market's melting down. It's a little chaotic, but a lot to talk about and a lot of interesting opinions flying around on both sides. Hopefully, things are doing better for you. Uh, massive launch today. Congratulations. Can you break it down for us and maybe introduce yourself as well? Thanks a lot.

• 45:57Speaker 02

  Yeah. Uh, so we're at the world's biggest Navy trade show.

• 46:01John Coogan?

  Cool.

• 46:01Speaker 02

  Here in DC. So the Sea, Air and Space Conference and we're in the dive bar.

• 46:11Speaker 02

  Our marketing guys are epic. So, um.

• 46:13John Coogan?

  I love it.

• 46:14Speaker 02

  Yeah. So we've got in the dive bar. So my name's Shane Arnott. I'm the Senior Vice President for Maritime Business Line here in at Anduril. So yeah, really, really, really big conference for us and two brand new products. Seabed Century Copperhead going public today. So yeah, it's pretty cool.

• 46:32John Coogan?

  Can you, uh, maybe let's start with Seabed Century. Uh, what, what was the genesis of the project? What's the need? Uh, and then what is the, what's the product actually do just for like a layman?

• 46:48John Coogan?

  Can you hear me?

• 46:49Speaker 02

  Yeah. So Seabed Century is about undersea awareness, if you will. Um, so hopefully my coming through okay for you guys?

• 46:57John Coogan?

  Yeah, you're good. Yep.

• 47:00Speaker 02

  Yep, great. Um, so it's pretty crazy. Like if you zoom out, like as, as a species, we know less about the seafloor than we do about the moon or Mars. Like, uh, some 70 to 80% of the seafloor is uncharted, which is crazy. So it's a good place to hide if you're a submariner. Um, it's also a good place to hide if you're a threat. Um. So we kind of created this system, if you will, to be able to bring light to the deep dark sea, if you will. So if you look at kind of vast amounts of infrastructure, so eighty percent, oh, sorry, ninety percent plus of internet traffic. So this particular podcast would be running across subsea cables.

• 47:43Jordi Hays?

  Yeah.

• 47:43Speaker 02

  Uh. Many nations have their gas lines under the uh the waves. These are broadly unprotected, unwatched uh right now. So the greatest vulnerabilities are below the waves and no one's really talking about it or working on it, apart from some super secret things. And we kind of think that's wrong. So Seabed Century was kind of, it came from that place. As you know, Andrew, we can invest our own money, put points towards things that we care about. And we believe this is a big issue that people should be working on. So it's Seabed Century.

• 48:15Jordi Hays?

  Is Seabed Century, uh, do you expect, you know, DOD, our allies, et cetera, to be the the main buyers? Or is this the kind of thing, if you are in the business of laying undersea cables, would would, uh, you know, tho- those types of companies be customers as well? Or is it purely defense uh applications?

• 48:38Speaker 02

  No, we we definitely see it as dual use, like anyone who's got energy infrastructure. One of the key things I will uh lay out is this is a cableless system. So it's completely wireless. So all the, all the systems, as you guys probably know, are Cold War era, you need big cable-laying ships to put these uh systems on the sea floor, uh, almost impossible to upgrade. These are completely wireless, um, fully electric, and you can place them in the ocean. Um, specifically, we can use some of our autonomous submarines. So you can place them covertly or clandestinely, which isn't a bad idea if you're setting up security cameras and the bad guys know exactly where all your surveillance systems

• 49:20Speaker 02

  are, kind of defeats the purpose a little bit. So this approach is is different thinking, if you will, that we can place them anywhere on the planet. We can get one of our submarines and you can place it with all sorts of different payloads in um, in the body of it for long-range surveillance, for listening, for other uh actions that you might be taking as well.

• 49:39Jordi Hays?

  So. Can you talk about the broad risk of uh undersea drones? You know, I imagine it's the same type of dynamic as, you know, uh, traditional, you know?

• 49:53Jordi Hays?

  Air-based drones in that you could send a $10,000 drone to destroy, you know, a pipeline that that could cost a billion dollars or cause a billion dollars of economic damage. And so the the whole ratio is pretty, pretty thrown off and and but I'd be curious, like, is it something that's not getting enough attention? Because it feels like right now kamikaze drones and and everything in Ukraine is sort of like dominating the narrative. But clearly, you guys are have found this important enough to to put a lot of R and D into it.

• 50:28Speaker 02

  Yeah, the maritime environment's been kind of slow to the punch, to be honest. Like, you look at the proliferation and the success of robots in the Ukraine conflict, and everyone looks back now and goes, yeah, of course, this was a better idea. And you also see kind of crazy things like Patriots being used to drop UAVs that are a tenth or a hundredth of the cost. The unit economics of that exchange just doesn't make any sense. So maritime domain, just on the military side, exactly the same. There is a proliferation of unmanned underwater vehicles, primarily from the Chinese and the Russians, also unmanned surface vehicles as well. And if you're going to utilize, and this is probably a good segue

• 51:09Speaker 02

  to the copperhead, which is the the next thing that we announced, which is a fast, flexible payload AUV, which could be made into a munition. So a torpedo, if you will. That particular system is built to be at a fraction of the cost of, say, like a Mark 48 or a Mark 54. These are very prevalent torpedoes for your listeners who aren't familiar with that. But when you're launching a Mark 48 against a USV that's like a tenth of the cost, the economics don't sort of work. So we've specifically built these things to be at a price point that's a fraction of. We can also build them at thousands per

• 51:52Speaker 02

  year, whereas kind of right now, you may be lucky to get 100, 200 torpedoes out of the supply chain as it exists today. And again, that that exchange ratio just does not work against kind of the fight that we're facing into. So the Asia-Pacific fight with China, clearly, that's a water-based conflict that's coming. But also, people don't talk a lot about the High North. So and that's where Russia is dominating. So uh you know, there's a lot of great stuff um sitting under the ice that's now retracting. Everyone wants a piece of that, you know, some of the discussion around Greenland and others is the basis of why the High North's kind of the next

• 52:33Speaker 02

  focus, if you will. So having these capabilities that are fully electric, so we can get them under the ice caps, for instance, is of interest to folks. Um the ability to do it at on mass affordably in order to kind of deal with a very wide waterfront is kind of the basis why we invest in these capabilities.

• 52:52John Coogan?

  Can you talk a little bit of a little bit more about the trade show that you're at and exactly what type of buyer are you interfacing with? What kind of uh points are you trying to make to them beyond just, hey, there's this new thing, it's important and cool?

• 53:08Speaker 02

  Yeah, so as as I said, um and you know, what's happening around me at the moment, world's biggest

• 53:16Speaker 02

  is everything from frigging to, you know, weapon systems, whatever else um that's kind of happening. So I think a big part of what we're trying to paint, if you will, is that we need a mixed match. So we've got our autonomous underwater submarines um that are in effect motherships for delivering these things, plus the seabed sentry, plus the copperhead, and just to be able to give the creativity back, and it's not an obvious thing. So enabling, you know, within the dive XL, which is our big uh underwater submarine or uh autonomous submarine, I should say, we can put dozens of copperheads in, we can put a dozen seabed sentries. So the ability that you can kind of

• 53:57Speaker 02

  mix and match and give more creativity to the commander, and that's not immediately obvious. So just kind of we've got virtual reality um uh experiences for people to kind of, ah, here's how I would do this, as well as coming into our our dive bar that we have here to, you know, have the conversation. But the it's not obvious. A lot of this is second order kind of understanding uh for what's incredibly wicked, difficult problem um that the subsea warfare uh environment kind of presents, if you will. So that's what it's about, being able to come here, start those conversations.

• 54:31John Coogan?

  I always notice that both the dive submarines and the new Copperhead are square. Is this, are there advantages to that? Does that mean that you're less compatible with old torpedo tubes? Or is there some sort of backwards compatibility? Or does it just not matter? And it's better to stack in, you know, a shipping container as you ship these around the world?

• 54:55Speaker 02

  Yeah, yeah, great question. So truth be told, it all started with Palmer. So Palmer Lucky, our founder. And, you know, I was kicking around and said, I, you know, boss, we're looking at doing a torpedo. And, and he said, oh, but make sure it's square. And I was like, or why? So I took it away and the guys did the numbers. And interestingly, for what we're doing, it's actually faster. So given we've got the, the software magic to fly these things, it actually flies more stable and quicker for the application that we want. Secondary is then the, the manufacturing. It's a lot easier to manufacture something that's like, you know, a bath as opposed to a big spherical pressure vessel thing.

• 55:41Speaker 02

  So that was very significant as well. So those two kind of together is why that's the case. Now it is a similar diameter to existing effectors like the Mark 48. So they could be used. It's not our intent at this stage. So our intent is for this to be launched off an autonomous effector, to be launched off an autonomous submarine. And that makes the integration and the safety case a lot easier when you're both sides of that equation. So when you're the archer and the arrow, you can just go a lot quicker. When it comes to changing the threat, changing the seekers, changing the capability can pivot a lot quicker. So that was the basis, the intent. But certainly a lot of customers have asked the question that you've asked, so we'll look into it.

• 56:27Jordi Hays?

  Maybe last question for me, just curious, does Andrew all have scuba divers on the, on the payroll? Or do you guys observe the R and D and the testing process using other? Is it, is it fully autonomous end to end? You just sort of launch them and say goodbye and then, and then watch from, from onboard? Or I'm curious, whatever you can share, I think it'd be fascinating.

• 56:49Speaker 02

  Yeah, I mean, part of the dev process is things go wrong. So I'm a scuba diver. Um, so when things go wrong, I'll stick the tanks on and jump in, um, as will the team. So I mean, it's, it's the iterative process. So, uh, it doesn't work all the time, but we're able to spin the wheel fast enough to get to good from, you know, bad fairly quickly. But, uh, yeah, certainly all the team, everyone's big enthusiasts of the, uh, the water space. It's, uh, not a terrible thing. Uh, we're in the group because all the tests are horrible places like Florida and, you know, city or, um, you know, California or whatever. Previously I did fast jet stuff and the, the test

• 57:31Speaker 02

  ranges for the Air Force guys are in these awful dusty places. So it's not a terrible thing doing Navy projects nowadays.

• 57:39John Coogan?

  Uh, I mean, last question for me and then we'll let you go. Get back to the important work you do.

• 57:43Jordi Hays?

  Get back to the dive bar.

• 57:44John Coogan?

  Get back to the dive bar. Uh, I would love to hear about some of the challenges of communication in the underwater domain. Obviously you're flying a drone around. You might be able to talk to Starlink. There's tons of satellites and other drones up. When you're underwater, signals don't travel as far. That feels like it makes autonomy more important, being able to operate even with if the connection gets lost. But can you talk about how you're thinking about, uh, communication and signal transmitting across the different fleet?

• 58:17Speaker 02

  Yeah, a thousand percent. So underwater is the worst domain. So comms suck. There's no GPS. All the things that you rely on for an autonomous system. So we've, it is the masterclass for autonomy. So not space, not air, not surface, not land. It is subsurface. It's the most difficult road. So, um, we've spent a lot of time and I think, uh, you know, Andrew, this is kind of our. Uh, what we're good at. Uh, but this is certainly, I've got probably the best autonomy engineers on my team because you've got such thin pipes or non-existent pipes. So you're in effect GPS denied, you're a whole mission. Um, you can only pass very, very small amounts of information between the assets.

• 58:58Speaker 02

  Cause they all do team together. So in doing so, like you need to be very judicious about what you pass and when in what configurations, et cetera. So, um, it it's the most difficult domain and, and one of the highest reasons for autonomy. And I think where we're getting the success is we've come with this software first thinking for a particularly difficult problem, which is this. I think everyone can build, you know, a, a sub, a submarine, autonomous submarine. That's not difficult. Having it survive, communicate, act, still be on a string from a human, particularly when you're taking kinetic action. Um, to make sure all the approvals are done in the right order is that's, that's the big challenge. So you hit the nail on the head, Bear.

• 59:42John Coogan?

  I, I, I did hear one interesting thing in the seabed century announcement. I think Palmer mentioned that it can detect biological creatures too. Uh, uh, is, does that have a benefit or is that just like a fun fact?

• 59:57Speaker 02

  Yeah, yeah. I mean, a- anything below the waves that kind of makes noise. And in fact, uh, you know, one of the big things we want to do is actually detect when the biologics, uh, you know, it's seasonally coming through. Cause you want to be careful when you're actually putting energy into the water because it can be harmful for sea life. So we, all of our systems are, uh, collecting the pattern of life, if you will. So we make sure that if there's some pumpbacks, you know, cruising through a surveillance area, that we're tuning down our sound system, if you will. Uh, to make sure that there is no damage to the, uh, uh, to the people who live in, or the animals that live in that space. So that's just, you know, good practice. Um, so yeah, it does all those things.

• 1:00:39John Coogan?

  You, you mentioned that, uh, the underwater domain is the hardest from a comms perspective, but Palmer's been talking a big game about doing subterranean warfare and tunneling.

• 1:00:50Speaker 02

  Yeah, yeah.

• 1:00:50John Coogan?

  Uh, do you think he's going to give you for a, a run for your money with an even harder domain or you think you're going to, uh,

• 1:00:55Speaker 02

  It is a bit hard. Domain, but we'll see what systems actually get employed. So right now, I think it's Subsea, but he's not wrong. He's always a step ahead.

• 1:01:05John Coogan?

  Okay.

• 1:01:06Speaker 02

  Truth be told, so.

• 1:01:07John Coogan?

  Yeah.

• 1:01:07Jordi Hays?

  Drill. It's gonna be, eventually it'll be time to drill.

• 1:01:10John Coogan?

  It's time to drill. Drill, baby, drill, Palmer and Anduril. Well, thanks so much for taking the time out of your, out of your day to come chat with us about this launch. Congratulations. It looks awesome. The design's fantastic and I'm looking forward to learning.

• 1:01:21Jordi Hays?

  Yeah, I imagine, I imagine you're quite busy because I doubt anybody was creative enough to come up with a dive bar at that, at that conference.

• 1:01:28John Coogan?

  Yeah, everyone's coming by, I'm sure.

• 1:01:29Jordi Hays?

  Yeah. Awesome.

• 1:01:31Speaker 02

  Yeah, we had to shut it down just for this. So everyone's very upset. They're, they're lined up outside. I'm not kidding. So.

• 1:01:36John Coogan?

  Oh, really? Okay, we'll get back to it. Thank you so much for calling in. We really appreciate it. We'll talk to you.

• 1:01:40Jordi Hays?

  Thanks, Joe.

• 1:01:41Speaker 02

  Thanks, guys.

• 1:01:41John Coogan?

  Thanks a lot.

• 1:01:42Jordi Hays?

  Cheers.

• 1:01:45Jordi Hays?

  Well, we shut down the biggest naval warfare conference.

• 1:01:49John Coogan?

  Yeah, we sent back the America, America's military.

• 1:01:51Jordi Hays?

  It's actually brutal. Imagine, imagine you're, you're Lockheed Martin. You probably spent 100 times more than Anduril on the booth and then nobody wants to come by. You can't, as Anduril's like, yeah, come by the dive bar and hang out. You actually get to touch the, the tech.

• 1:02:07John Coogan?

  Ridiculous. Should we, should we go back to the timeline and turmoil?

• 1:02:11Jordi Hays?

  Yeah, let's do a little bit of timeline.

• 1:02:12John Coogan?

  Do a little bit more timeline and then we will, I, I mean, actually we could move on to some of the more optimistic news. I don't know if you saw Lama 4 launched.

• 1:02:21Jordi Hays?

  Yeah.

• 1:02:21John Coogan?

  That's very exciting. And of course, we got Zuck with a front-facing camera video. Hello, everyone. It's Lama 4 Day. Lama dropped a, of course, the open source LLM from Meta. Now they have a 10 million context window, which I believe is 10 times what Google was previously offering, offering with Gemini. And the elo is insane. There's a bunch of debate about how much of an advancement this is. Are, are the benchmarks getting saturated? We should get into all of that, but I think it's just cool that. What they've clearly recognized is that you need to be superlative in something when you're launching a new product. And there's a lesson for that in, even if you're launching like a CPG product, you know, be Celsius. It's the, it's the energy drink with the

• 1:03:04John Coogan?

  most caffeine of all of them, more than Monster and Red Bull, right? And so you can say a lot of things about it, but like you can sum it down into what is Lama 4 good at? Well, they're the best at the biggest context win.

• 1:03:16Jordi Hays?

  Context.

• 1:03:16John Coogan?

  And then there's a lot of other stuff that's interesting. But it's funny, Austin Allred posted a screenshot from Zuck on threads. Somebody said, why did you drop Lama 4 on a Saturday, bro? And Zuck responded, which is awesome. Normally, like the comms people would be like, oh, like the person's using bro, like shouldn't engage with that person. Like they're not serious. You should only take questions from like really serious people. But Zuck just comes in and says, that's when it was ready. That's when it was ready. It was ready on Saturday. So we launched it on Saturday. And I love that. And Austin says, bullish. I agree. Very bullish. And Zuck's photo on threads is him, an AI image of him with like 25 gold chains.

• 1:03:55Jordi Hays?

  And that's actually wild.

• 1:03:56John Coogan?

  Such a good, such a good meme that he's just like, yeah, I'm rocking the 25 chains. I remember.

• 1:04:02Jordi Hays?

  And he's got a piece on in the video, too.

• 1:04:04John Coogan?

  Yeah, yeah, yeah.

• 1:04:05Jordi Hays?

  Not holding back.

• 1:04:06John Coogan?

  He's hanging out.

• 1:04:07Jordi Hays?

  Amjad says, if Satya and Zuck are shipping on a Saturday, what's your excuse? Satya posted, thrilled to bring Metas Lama 4 Scout and Maverick to Foundry today as we continue to make sure Azure is the platform of choice for the world's most advanced AI models.

• 1:04:21John Coogan?

  Being LLM indifferent. They just want to rent the space. Satya wants to rent. He wants to vend. He wants to deliver models all over the place. This is interesting. There's an article, a post from Less Wrong, says, recent AI model progress feels mostly like BS. And we won't get into the whole article. You should just go read it. From zero path.com. This was posted by LC on on less wrong. But it tells the story of someone building a penetration testing tool driven by AI. So, you know, penetration testing, of course, is you build a software application. You put it up on a server on the Internet.

• 1:05:07John Coogan?

  And then are there different ways you can get around the security? Figure out if there's a different way to to break into the server, get root access. You hear about this like WordPress gets hacked every once in a while. And people figure out how to get into the admin page and kind of change your blog posts. But of course, pen testing is very important, especially at the higher level. And the more money is at stake, the more the bigger the business, the bigger the prize for the hackers. And so this this person was building a an AI driven pen testing thing. Says about nine months ago, I and three friends decided that AI had gotten good enough to monitor large code bases autonomously for security problems. We started a company around this, trying to leverage the latest AI models to create a tool that could replace at least a good chunk of the value of human pen testers.

• 1:05:51John Coogan?

  They've been working on this project since June 2024. And what he goes on to say is that there's all this hype on on on X and in AI circles about a new model that, oh, now it can, you know, do IMO gold medals and stuff. But for some reason, he, yeah, not yet, but soon. But but but he keeps he keeps switching to the new models and getting

• 1:06:13John Coogan?

  results that are quantitatively better, but not qualitatively better. And so it's not really solving his problem. And this is this question of, you know, we've seen with GPT 4.5, maybe pre-training is maxing out. Maybe scale is all you need, but you got to apply that scale to the right algorithm. Maybe now it's reasoning models and you got to scale those up. Maybe it's something else. Program synthesis is basically right. Have the model write code that does the problem that you want it to do.

• 1:06:42Jordi Hays?

  Yeah, and also the just needing new ideas.

• 1:06:45John Coogan?

  Yeah, new ideas. And it's crazy, I need to dig this up because I think this would be a very viral clip. But George Hots went on Lex Friedman after GPT 3 dropped. So this was maybe back in 2021.

• 1:06:58John Coogan?

  And he said that, you know, AGI or ASI will not be GPT-9. It will not just be scaled up of next token because that is not the algorithm for intelligence. That is one thing that we do as humans, but there are a lot of other factors that go into intelligence. And you, and you think about that where, you know, even someone like, isn't it Daniel Kahneman with thinking fast and slow? This idea that you have two different frames of thinking. You can, you can be very reactive and think fast, but then you can also step back and, and there's all these different subsections of the brain. We barely understand the brain, but we understand that there are long-term memory, short-term memory. You know, there's probably some humor segment that we haven't even tried to build yet. And all these different.

• 1:07:41Jordi Hays?

  Funny bone.

• 1:07:42John Coogan?

  The funny bone. Yeah. The funny bone has not even been tried to be put into silicon.

• 1:07:47Jordi Hays?

  No, but Mike from Arc Prize and Zapier aligns with what he was saying, which is like, hey, we need, we still need new ideas, which is part of what gets me excited about SSI.

• 1:08:00John Coogan?

  Totally.

• 1:08:00Jordi Hays?

  Trying to take a new approach.

• 1:08:01John Coogan?

  Yeah. I mean, yeah, I mean, Ilya Sutskever seemed to be not only the person that decided that, that read the Attention is All You Need Transformer paper and realized the impact of it. Because we look back on that and there's this survivorship bias where it's like, yeah, of course. Like all these Google Brain people put out this amazing paper called Attention is All You Need. They described the transformer architecture. Of course, that was like going to be groundbreaking from day one. But you forget that on that day, there were probably a hundred papers that dropped. And the next day there were another hundred papers that dropped. And even that Google Brain team was publishing other papers and others, other research trees and other paths. And even things like symbol manipulation were popular at the time and all sorts of different algorithms were being tried.

• 1:08:44John Coogan?

  And Ilya had the foresight to realize that that was the architecture that you could throw a billion dollars of compute at and get a really magical result. He did it. OpenAI released ChatGPT. It becomes this amazing, like, you know, LLM. We know about that. They implement transformer architecture in a ton of different stuff, even Tesla's autopilot has transformers baked into it now. It's all over the place, this architecture. Then he realizes that reinforcement learning, kind of the the AlphaGo, the Mu0, the stuff from DeepMind, again from Google, you put that on top of an LLM, have it self-play, have it talk to itself, reasoning tokens, that will be the next, the next amazing thing. Originally called Q-Star, very scary. There's all this chaos. Then it becomes, you know,

• 1:09:29John Coogan?

  what was it, strawberry? Then eventually it becomes O3, O1, O3 high, O3 mini high, R1 from DeepSeek, all these different reasoning models come out. They clearly, deep research, they clearly advance the ball towards something that's more usable. You see the coding agents like cognition and Devin doing something similar where there's, there's a reasoning layer on top of a pre-training LLM. But the question is, what's next? And I think everyone is kind of in a, seems to be coming to the conclusion that there will be a next thing in order to unlock the next big breakthrough. And we're excited to watch it. But as the

• 1:10:08John Coogan?

  model, as the race for just general LLM training and scale heats up and all the news about, you know, Grok is in the game now and, and OpenAI is scaling up to 4.5, there's GPT-5 coming at a certain point, there's, there's DeepSeek, Meta has been continually pushing the ball down the field. They have a lot of infrastructure as a hyperscaler, but there was some controversy on the timeline from Nick. He says, breaking Meta AI internally caught cooking benchmarks to hide poor, poor results, absolute state. I don't know how, how, how, how real this is, but they are alleging some benchmark fraud, which you hate to see.

• 1:10:51John Coogan?

  Let's read it. It says, "The original post is in Chinese, but the translation here says, 'Despite repeating trade interference, the internal model's performance still falls short of open source state-of-the-art benchmarks, lagging significantly behind. Company leadership suggested blending test sets from various benchmarks during the post-training process, aiming to meet the targets across various metrics and produce a presentable result. Failure to achieve this goal by the end of April deadline would lead to dire consequences. Following yesterday's release of Llama4, many users on X and Reddit had already reported extremely poor real-world test results. There was a debate about whether or not you could even run this on, you know, I'm sure people will like play with the models

• 1:11:32John Coogan?

  and we, we talked to some of the OpenAI folks about like, yes, there are all these evals, but at the end of the day, you kind of just got to talk to the model and play around with it and see if it's useful. And then also you need to implement into your system or your codebase and see, you know, is this solving a real problem? Maybe it is, maybe it isn't, but it kind of depends on your, your, the economics of your business and the, and the application that you're building for. So, interesting to see where this goes. There's been allegations of benchmark fraud and eval saturation all the time. Some of it is just completely accidental, just because, you know, someone posts a benchmark, then all the results go onto the internet, that goes in the next scrape, and then of course

• 1:12:12John Coogan?

  it gets baked in. And so, you know, AP Bio, for example, every AP Bio question is just on the internet now. And so it goes into the pre-training data. And so it's basically just memorized every AP Bio question and answer. Is it really good at biology? Like, it's kind of hard to say. It's certainly good at looking up the answers, which is great, and that's useful.

• 1:12:33Jordi Hays?

  Memory is all you need.

• 1:12:34John Coogan?

  And it's, it's a great, yeah, it's a great, is it intelligence? These things are certainly extremely high on knowledge and they are amazing knowledge engines. Isn't that the term you use? Knowledge engine?

• 1:12:45Jordi Hays?

  Answer engine.

• 1:12:46John Coogan?

  Answer engine. Like they're fantastic at that. And what I love about Llama4 is that

• 1:12:50Jordi Hays?

  It is funny to think about.

• 1:12:51John Coogan?

  You bake it down.

• 1:12:52Jordi Hays?

  If you took a human who had, was sort of lowest on intelligence and then you gave them all the knowledge in the world, in so many situations, they could fake intelligence.

• 1:13:04John Coogan?

  Totally.

• 1:13:04Jordi Hays?

  Like they could, you sort of ask them something, they give you an answer, you go, wow, so smart.

• 1:13:10John Coogan?

  I mean, do, do Jeopardy or do, do trivia at a bar. You'll be like, that guy's so smart. He knows exactly who won the World Series in 1982. But it's like, is that intelligence? It's unclear. Anyway, I like David Holes, founder of Mid Journey. He says, "I desperately want Mark Zuckerberg to pose with four llamas for the Llama 4 release. I'll even say, please, we need aesthetic moments in tech, and this llama branding is good for one thing and one thing only."

• 1:13:35Jordi Hays?

  Great picture.

• 1:13:36John Coogan?

  Great picture, clearly generated from Mid Journey. Looks fantastic. But Zuck has the resources to do it, and I think he has the the character and the and the personality to pull it off and have fun with it. And so I would.

• 1:13:48Jordi Hays?

  Drop the chain, pick up the llamas.

• 1:13:50John Coogan?

  Yeah, do get get four llamas together. Do some, do some llamas, llama photos. Anyway, Toby Lutke has a leaked memo that's been floating around that's pretty interesting, all about how Spotify is using AI. He says, "AI usage is now a baseline expectation. We are entering a time where more merchants and entrepreneurs could be created than any than in any other than than any other in history. We often talk about bringing down the complexity curve to allow more people to choose this as a career. Shopify's whole business is making e-commerce easy, so they want to make it as easy as possible to set up an online store. They've done it very, very well, in my opinion, but they want to

• 1:14:33John Coogan?

  continue. Each step along the entrepreneurial path is rife with decisions requiring skill, judgment, and knowledge. Having AI alongside the journey, and increasingly, not just doing the consultation, but also doing the work for our merchants, is a mind-blowing step function change here. Our task at Shopify is to make our software unquestionably the best canvas on which to develop the best businesses of the future. We do this by keeping everyone on cutting on the cutting edge and bringing all the best tools to bear. So our merchants can be more successful than they themselves used to imagine for what we just for what we need to be absolutely ahead." And he outlines this in an email to every Shopify employee. "Reflexive AI usage is now a baseline expectation. Maybe

• 1:15:18John Coogan?

  you're already there and find this memo puzzling. In that case, you are, you already use AI as a thought partner, deep researcher." Critic, tutor, and pair programmer. I use it all the time. And so he's telling folks, you gotta be using AI and we got to build it into all of our products. So just interesting to hear from a big public company CEO in founder mode, definitely pushing towards more AI.

• 1:15:40Jordi Hays?

  Yeah, I'm gonna go out on a limb and say, I don't think this was leaking.

• 1:15:44John Coogan?

  Oh, you think it's recruiting?

• 1:15:46Jordi Hays?

  I think.

• 1:15:46John Coogan?

  Oh, no, my, my memo leaked.

• 1:15:48Jordi Hays?

  My extremely well-written, kind, visionary memo.

• 1:15:52John Coogan?

  I think it probably leaked. But he did post it now and it's good.

• 1:15:54Jordi Hays?

  No, I'm sure it would have leaked. It's just, it's just.

• 1:15:58John Coogan?

  You kind of write these things with leaks in mind. Anyway, we got our next guest coming in to the studio. Welcome to the show, Logan.

• 1:16:06Logan Bartlett?

  What's up, guys?

• 1:16:08Jordi Hays?

  We wanted to bring on the foremost geopolitical expert, tariff expert, and.

• 1:16:14Logan Bartlett?

  And you couldn't, you couldn't get that person. So I, you got a VC, which is the next best thing, I guess.

• 1:16:19Jordi Hays?

  No, honestly, what we've seen is growth stage VCs tend to be, you know, have the strongest opinions most strongly held. So.

• 1:16:28Logan Bartlett?

  Listen, I am open to, I would love nothing more than to be wrong about all of this stuff. And I, I spent my weekend glued to my phone more than I should, both out of schadenfreude and also debating Keith Rabois back and forth, which has he already come on? Is he already?

• 1:16:46John Coogan?

  No, he's coming on in 30 minutes. Maybe you just stay on and start arguing.

• 1:16:49Logan Bartlett?

  We're actually doing a podcast tomorrow. He and I are. I'm going to try to be a neutral moderator in that discussion rather than a participant. But yeah, it was, it was interesting. It was interesting to hear his perspective about the, what the intended results are of this. Because I guess I typically try to stay out of like, politics for the most part. But this, I don't know, this feels a little bit adjacent in that it's pretty economically driven and does tend to impact the world that I play in. So I ended up dipping my toe into it far more than I wanted to.

• 1:17:27Jordi Hays?

  Well, let's start how conversations have gone with.

• 1:17:32Jordi Hays?

  Portfolio company CEOs, you guys have obviously been a growth stage, software, investment firm. But I'm curious, in talking with CEOs over the weekend, what's been your sort of high level, what's been, what's been top of mind, aside from just kind of battening down the hatches, maybe?

• 1:17:52Logan Bartlett?

  Yeah, I mean, I think it's mostly that. I will say, it sort of feels like we've been through three different existential, potentially risky circumstances over the last, what is it, five years? We had the March COVID stuff, and then we had the unwind that sort of happened post-Zerp, the time to get fit, or whatever it is. And now we have this. And so, it feels like most of our CEOs are a kind of old hat, in some ways, at how to deal with this stuff. And I do think that we measure our time in months and years, and not, you know, days and hours, if you will. And so, I think it's kind of a wait-and-see approach, in particular because it's hard

• 1:18:35Logan Bartlett?

  to know, is this a means to some end that might be orthogonal to the pure economic purpose of it? And I think you're sort of seeing that with what Navarro comes out and says, versus what Besant will say, versus what Elon's, you know, out tweeting now. It's a little bit hard to know what the strategy is behind this. I do think we probably need to take it literally at this point, and assume that this is probably here to stay in some way, shape, or form. But I do think that our company shouldn't be totally moving the dials too much in the near term.

• 1:19:14John Coogan?

  What do you think's happening? I mean, you do those fantastic public market reports. It feels like just kind of everything's down, but I would assume that some of the larger SaaS companies that are in the public market should be less affected. But do you think that there will be any sort of like bifurcation, or like, flight to safety that might happen in the next couple of months, as people kind of figure out who's actually exposed? Like, if you're Nike, it's different than if you're Salesforce, I imagine?

• 1:19:50Logan Bartlett?

  Yeah, it's a great question. I think that it seems because we've gone through this twice before. And ultimately, the results that were learned out of that in the post-COVID, you know, after March of 2020 and then after 2022, it seemed that everyone kind of learned similar-ish lessons of it and maybe the wrong ones. Like, post-COVID, the right answer was to invest into all these tech companies. And so I do think with the war chest that a lot of the venture firms have right now, I think it's going to take a while before people actually stop dancing. I think everyone's going to convince themselves, at least in the near term, that this is a good buying opportunity.

• 1:20:34Logan Bartlett?

  And if you look, like I was looking at some of the numbers, I think March was the highest buying that we've seen on record from retail investors. And so it feels like a lot of people have learned similar lessons of like, oh, my gosh, well, when a dip happens, that's actually a better buying opportunity than it is a time to be fearful in this. And so my guess is it's probably going to take a couple quarters before anyone starts to capitulate that maybe this is the new normal, particularly given how manic the market has kind of been and the decision seems to have been.

• 1:21:08John Coogan?

  Yeah. I remember during the kind of Zerp unwind post-SBB crisis, you did a show where you were talking to somebody about just this idea of like dry powder. And everyone would say, oh, well, like the VCs have so much money, they have to invest. And of course, there were a bunch of funds that like returned capital or sized down their funds. But then most of the funds just kind of ripped pretty quickly and came, found excuses to move into AI and stuff. And at this point, it feels like if you're an LP in a large fund and you see the market down, you've been trained. So I guess the question is like, like.

• 1:21:48John Coogan?

  Do LPs pay more attention to this than GPs? Or does this, or is it even a longer cycle for the LPs to actually start making calls and saying like, "Hey, how are you adapting to this strategy?"

• 1:22:01Logan Bartlett?

  Yeah, I think that the GPs in some ways, like when you're a hammer, everything looks like a nail. If you're, if you're thinking like, "Hey, I need to do growth stage investing," then I think a lot of people just operate with, "Okay, I'm going to invest in the relative quality of the names that I see over the next quarter, two quarters, four quarters," and try not to be too episodic. Because at the end of the day, what we're trying to deliver back to our limited partners for the most part isn't some relative adjusted return versus all the other sectors in the economy, right? We're not deciding, "Should we go buy lumber?" Or should we go buy futures contracts or go buy equities in the public markets? Like, we're delivering some sliver of a product.

• 1:22:46Logan Bartlett?

  And I think with a lot of LPs, that's also the case, where you've seen kind of this, as they've been more institutionalized, you've seen different people become responsible with, "Oh, I'm not just responsible for the venture book, I'm actually," or "I'm not just responsible for the privates book, I'm actually just responsible for the ventures book, and we're going to allocate 8% or whatever it is to that." And, and so at a, at a micro level, I think a lot of the LPs are incented, almost similar to the, to the GPs. Now, as you go up further and further up the stack to the CIO, or someone that oversees some like broader purview of all this stuff, then those people are making relative trade-offs of like, "Is venture at a 12% level like the right exposure that we want to have going forward?"

• 1:23:31Logan Bartlett?

  And that's where the denominator effect can really play through. I will say back to the, everyone kind of learning similar points, though. It does seem like a lot of the LPs have decided... Hey, um, the best time to be in these managers is, is when things are going down. And so we're going to commit to it. And then there's also this like kind of principal agent problem, I guess. I don't know if that's the perfect term for it, but if you leave a, uh, a firm, then they don't let you back in the next fund. Like you don't get the cherry pick. Okay, I'm going to be a part of this vintage, uh, but not that vintage for the most part with the blue chip names.

• 1:24:10Logan Bartlett?

  And so the LPs in some ways are sort of faced with a, a decision of do I want to get out of this manager almost in perpetuity? Or do I want to stick with it and trust their ability to navigate those waters? Uh, and so I think that there's a bunch of different dynamics that sort of play out in all of that. Uh, and it's going to take a while for it to roll all through, right? Like fund cycles are two to three to four years. And it's only on those time periods that the LPs are really making these decisions. So I think we're a long way from knowing.

• 1:24:38Jordi Hays?

  Yeah, doesn't this just continue to overheat AI in that, you know, especially in, in other sectors too. When I look at the areas that have gotten the most hype and attention in some of the biggest rounds recently, it's defense, robotics, AI. And like, if I'm a GP or I'm an LP, those are three areas that I actually, you know, the world's becoming less stable. It feels, it certainly feels less stable. AI is not getting tariffed and we need to, you know, the, the sort of onshoring, reshoring narrative just means that you want to deploy even more dollars there.

• 1:25:15John Coogan?

  Yeah. It feels actually very on theme.

• 1:25:18Logan Bartlett?

  Go ahead.

• 1:25:19John Coogan?

  No, no, you know, it just feels very on theme, but yeah, what's your take?

• 1:25:22Logan Bartlett?

  I, I mean, I think so, although I wonder, um, when we talk about like AI not getting hit or semis not getting hit with tariffs, like it's such a complicated global supply chain that, um, I do worry about the, um, like I, I, I think, and I've heard anecdotally from some of the big foundation model companies that, um, the different tariffs and the, the issues that you have to deal with, not just China or Taiwan or South Korea. But also, even Mexico, like, there are a bunch of inputs, even if it doesn't feel like they're direct inputs. There's so many complicated pieces of the puzzle from an AI standpoint that

• 1:26:07Logan Bartlett?

  that I think it's going to be hard to disassociate the aggregation that is what's being tariffed into AI. And in talking to people over the weekend that are exposed to these large model companies, I think there's a real, real concern about what this is going to do to those businesses and their ability to access the different things that they ultimately need. And it could be everything from, I don't know, cooling to different server types. And all these different pieces are a part of a big chain. And so I will think there, I do think there will be a flight to those things in some ways. But I, I'm hesitant to say that they're not going to be impacted.

• 1:26:50Logan Bartlett?

  I actually think, especially the way at least this has been messaged thus far, it feels like there's going to be a lot of different inputs that ultimately cause a bunch of issues, no matter what the end market is, be it defense or be it robotics or be it AI.

• 1:27:04John Coogan?

  Yeah, we were talking about electrical transformers, not the architecture, but very key ingredient in drawing power into these huge data centers. And most of those are made overseas, many of them in China. If there's, if there's tariffs on those, it could slow down the roll up, rollout of new data centers. Although I imagine that's not a huge portion of like the per token cost. But even like Polly Market has the chance of a US recession in 2025 at a 62% chance. If there's a recession, like people could say, you know what, $20 a month GPT or chat GPT plan? Like, maybe I downgrade. There could just be like some consumer hesitancy to add a new subscription as people tighten their belts.

• 1:27:44Logan Bartlett?

  I think I think that's 100% where we're headed on all this like I think that at a minimum, some of these things are self fulfilling in some ways where if we have the perception of a slowdown, then people are going to stop spending, which will inherently lead to a slowdown. And so it starts to become a little bit self fulfilling in that regard. And so I I've seen stuff, I mean, I realize Polly market saying 62%. It sounds like I think Goldman moved their estimates to 45% this morning or their economists did. And I've seen some people saying we're already in the in the middle of a recession. I mean, just the amount of uncertainty that this has introduced. I don't know how you do any planning.

• 1:28:27Logan Bartlett?

  If you're a if you're a business right now and you're thinking through like, should I? Maybe not Apple or someone that has like, you know, a gobs and gobs of money to go figure this out. But like a midsize public industrial company or something. If you're thinking through like whether or not to start rebuilding in the U.S., which in some ways is a very noble goal, particularly with regard to security. And so I don't mean to be like entirely anti tariffs. But if you're thinking through that and you're not sure, I mean, we've seen some people start to break ranks on tariffs already, be it Elon or Ted Cruz, or I mean, Ackman. There's like a bunch of people in the Trump world that's starting to break ranks.

• 1:29:08Logan Bartlett?

  And then Congress does theoretically have the power to revoke some elements of the president's tariff power. And so, I mean, there's murmurs of that, not to mention midterms in the next, whatever it is, 18 months. And so you have all these different things that could throw a wrench into the the tariff plan. Not to mention, maybe this is just a means to some other end as a negotiating tactic. And so I don't know if if I think people are going to be stuck in the state of paralysis a little bit of like, what do we what do we actually do right now? And inherently, I think that becomes self fulfilling in the way that it's going to lead to a recession for us. I hope, again, I hope I'm wrong. Like, I don't want to be right about any of this stuff.

• 1:29:50Jordi Hays?

  Uh, do you, how do you wait, uh, posts coming from the handle at Chamath on X? Because, um, you know, he's, he's clearly one to happily sort of like talk his book. But at the same time, yeah, yeah, that, that guy, the C H A M A T H.

• 1:30:10Logan Bartlett?

  The guy, the all in guy.

• 1:30:12Jordi Hays?

  Yeah, yeah, that guy, that guy's a big podcaster, but no, so, so there's two things happening. One, clearly happy to talk his own, um, book. He's probably super long Laura Piana, uh, among other things, but, um, he also is like, you know, podcasting with the people, some of the biggest sort of like.

• 1:30:32Logan Bartlett?

  He's an insider.

• 1:30:33Jordi Hays?

  He's an insider, right? And so it's one of those things he's, he's coming out, I think it was last night or this morning, talking about the Mar-a-Lago Accords. How do you, uh, how do you kind of evaluate? You know, it's a signal. I don't know if it's a good signal or an accurate one, but, um, do you, do you put any weight on, on anything?

• 1:30:52Logan Bartlett?

  You know, there's this great feature I've started to use on, um, on Twitter X. Uh, and you can actually do it for any account. I, I, uh, you, it's, um, I, I forget exactly where you find in the screen, but it mutes these people for talking and then you don't see what they have to say. And I didn't know, I didn't know it existed. And so I will say, I, I don't know what made me think of that, but I will say that, um, I, I think you have to take some of the insights that these folks have because of their access. You have to take it, um, with probably a grain of salt, but also as a potential angle

• 1:31:33Logan Bartlett?

  of dissemination of information, uh, or at least trial balloons going out there. I saw right before I came on, Kimball Musk tweeted something about how terrible tariffs are. And, uh, maybe he just woke up today and thought that, or maybe, you know, his brother, who he sits on the board of, and I think a lot of his net worth can be attributed to, uh, maybe encouraged him to go say that. And so I think it, it, to be dismissive of any of these individuals, uh, I, I think is probably not, not particularly smart.

• 1:32:04Jordi Hays?

  Do. But I'll even if I'm making a joke, I'll say it out loud to John first and be like, what do you think? And if John thinks it's funny, I'll post it. If he says, I don't know.

• 1:32:15Logan Bartlett?

  Which is the exact same thing as, you know, the Kimball Elon thing.

• 1:32:20John Coogan?

  Yeah, the Elon thing is.

• 1:32:21Logan Bartlett?

  And so I but but but I think all of that is to say, I'm not sure there's like, I think we've sort of seen that that what Besen says versus what Navarro says versus what what Elon says, like, there's not any consistency that at a high level is coming out from those different people. There are all the messages are slightly different. And so I would I would find all this stuff pretty intriguing, if not, if not necessarily factually accurate. And so I feel like all these things are kind of informing the little inputs into my decision. But I do think it's interesting to see people like Dan Loeb, or Dan Loeb, Bill Ackman break

• 1:33:02Logan Bartlett?

  rank and start to come out and really be negative against these tariffs. I mean, we can joke, and I have certainly on Twitter about him and changing his views and all this stuff. But like, at least he's owning some of the decisions that he now finds to be wrong. I find the most frustrating thing is a lot of people just morph their view into whatever fits into the, I mean, Donald Trump specifically, but this is true of of people on the left as well, that whatever they say is their talking point, they just follow it in suit. And so I give Ackman credit for breaking rank. And maybe we'll end up seeing Chamath or some of those other guys do the same.

• 1:33:44Jordi Hays?

  When's the last time?

• 1:33:46John Coogan?

  Yeah, the Elon thing is interesting, because you'd think he'd be a big beneficiary of tariffs because of the cars and the exposure for Tesla. But my question is, like, I feel like tech VCs like shifted so into the Trump camp, like, I'm not even seeing like, like, the big dissenting opinions on tariffs are coming from like Tyler Cowen and The Economist. And I'm not seeing that from like, big GPs. And it's, it's like, have they just completely over rotated? Or do you think that they're just not even thinking about it or not exposed to it? Like, what's driving the lack of?

• 1:34:18Jordi Hays?

  Well, one thing to note, Tesla sell sold.

• 1:34:24Jordi Hays?

  Almost three quarters of a million, they sold just under 700,000 cars in China last year.

• 1:34:31John Coogan?

  Sure, sure.

• 1:34:32Jordi Hays?

  The trade war is like very bad.

• 1:34:34John Coogan?

  And I'm sure they source from China very heavily for certain things.

• 1:34:38Logan Bartlett?

  Yeah, and I think they have, they have factories there as well.

• 1:34:40John Coogan?

  Yeah, yeah, yeah.

• 1:34:41Logan Bartlett?

  Yeah.

• 1:34:41John Coogan?

  They have a Gigafactory in Shenzhen.

• 1:34:43Logan Bartlett?

  You know, there's this interesting thing that's, that's played out where I think kind of post the election, it was so uncool to have voted for Kamala Harris, to the, to the point that I was at parties kind of being accosted, like people asking who I voted for and all these things. And I was like, and I just found it an unusual swing of the pendulum in that way. And I give the Democrats, there's a lot of blame that Democrats should, should have on that. The one that I, there's obviously all the DEI and whatever, all that stuff. But I do think that if you look, Democrats have been very anti-growth and anti-capitalism

• 1:35:25Logan Bartlett?

  in a meaningful way. And I think it was just kind of embarrassing in some ways to be extolling their virtues or pushing back too much over the course of the last couple of months because it was such a resounding election defeat. And there was such a, even the people that I think within the, at least the parties I know that within technology that voted for Kamala Harris, like they, they all seemingly held, not all, but a lot of them seemingly held their nose and did it and was like, hey, this is the lesser of the two things. And so now under the tariffs, it's been, I feel like people are like warming up their

• 1:36:07Logan Bartlett?

  thumbs a little bit, like sort of forgetting what it's like to like push back too, too much on, on this. And so I, I found myself wading in the waters of all of this far more than I expected. What I found most interesting though, at like a high level is just how populist a lot of the rhetoric within the Republican Party, or at least Donald Trump has become. And I mean, you sort of go back and you look at Milton Friedman or Ronald Reagan or like some of these OG conservative icons and what they had to say about tariffs are just so different than what we're hearing from our president today. And so I guess the question in this is like, does this present ultimately, if this is going to be the move that the Republican Party makes from a populist standpoint, does this present an opportunity for?

• 1:36:52Logan Bartlett?

  The Democrats to be a little bit more pro-growth and like, let's grow the pie. And I think it was pretty well timed that Ezra Klein and Derek Thompson wrote that book, Abundance, right? Because this, there was no such thing really over the last decade as a pro-growth Democrat, I think. And that would be an interesting lane for the party to try to rally behind. I just don't know. Ultimately, these things seem to follow some like charismatic politician in some ways. And so I don't know who that person is. Shapiro seems like someone that could be interesting in that regard. You know, maybe if we tweet enough, we can get Weinberg to run for some political office. He can take the pro-growth Democratic thing. Maybe that's Aaron Levy's next, uh, next, you know, gambit he's gonna go down is politics.

• 1:37:36Logan Bartlett?

  Uh, but it feels like that's a mantle that, that people should really take.

• 1:37:39John Coogan?

  I don't think his hair can get any grayer.

• 1:37:41Logan Bartlett?

  I agree, honestly. And it's still full. That's the thing. I don't know if that's just genetics or him's or who we credit that fullness of hair. It's definitely gray, but man, it's like a robust set of hair. It almost feels like he's set up to be presidential in that regard.

• 1:37:56John Coogan?

  You take a company public at like, what, 29? Like, you're gonna go gray.

• 1:37:59Logan Bartlett?

  Which will do it to you. Couldn't you see it though? I mean, he honestly looks like a West Wing, you know, like a Josh Lyman kind of running into Martin Sheen, President Bartlett's office on the West Wing now with that gray hair. I could see it.

• 1:38:11John Coogan?

  Yeah.

• 1:38:12Jordi Hays?

  What did you, what did you think about Toby's leaked memo from this morning where he very eloquently lays out how he wants his employees? Like, to be, to be honest, like, one, it's well timed, in my point of view, and that you can basically say to your team, we're freezing hiring without saying we're freezing hiring, because now it's like, hey, if you wanna hire, if you wanna actually make an offer.

• 1:38:37John Coogan?

  Hire an agent.

• 1:38:38Jordi Hays?

  Hire an agent. Yeah, yeah. No, but I'm curious, uh, you know, obviously if it was leaking, wouldn't have been that damaging, but it's cool that he put it out there. I'm curious what, what your immediate thought was.

• 1:38:48Logan Bartlett?

  Yeah, it's it's something we've been thinking more and more about and I've seen my my my own workflow switch so much more to being AI native in like what I'm doing on a daily basis. I'd be curious your guys' perspective on like prepping for this show. It's just so much easier to get information at your fingertips and and get access to I feel like I learned more this weekend or the last week like going really deep into the history of tariffs and all this stuff. It would have taken me in the past like I don't know, three weeks to do what I did over the course of the last four days, five days. And so I get the perspective of like,

• 1:39:31Logan Bartlett?

  hey, we have to make our company AI native in some ways. I do, I imagine there's a little bit of marketing behind it, like behind every good leaked internal memo. There does seem to be an element of both signaling to the broader market as well as potential new candidates that are coming on board. Like this is the new normal. This is the way we're gonna do things. But I haven't heard anyone else do it. I don't know. You guys probably know better.

• 1:39:59Jordi Hays?

  Well, the Klarna, I mean, the Klarna took another approach. It wasn't a memo. He just came out. We're not hiring anyone.

• 1:40:04John Coogan?

  It was like almost overly aggressive and everyone was like, we don't really buy it, man. Like it's too much. And then Jeremy, Jeremy Diamond? Jamie Diamond had that leaked like voice call.

• 1:40:15Logan Bartlett?

  Yes.

• 1:40:15John Coogan?

  Where he was like, you gotta work really hard. And it was like, okay, this is just a billboard advertisement for your company and your culture, which is cool. But I think the lesson is like every, we all need to be leaking more memos.

• 1:40:26Logan Bartlett?

  I think that's right.

• 1:40:28John Coogan?

  Your red point analysis, you shouldn't, you shouldn't try and post that. You should be like, it's leaked.

• 1:40:32Jordi Hays?

  We'll leak it.

• 1:40:33Logan Bartlett?

  That's what I don't know if you guys ever like newcomer, Eric Newcomer, that's like a bunch of interesting like, oh, here's founder's fund returns. And I'm like, heck, like, how did you, who would have given you these amazing returns?

• 1:40:48Jordi Hays?

  If you have good news, you gotta leak it.

• 1:40:50Logan Bartlett?

  Yeah, the other one that I thought was really masterful PR was was Asef and Wiz last year. What was interesting in that Wiz announcement, when they, when they announced that they were going their own and not going to be bought by Google was like, everything that they said was then reported on the media, in the media because of the leaked memo. And so they got to really control the narrative of how things went down with Google. So I actually, the dark arts of PR, I think is, is a pretty clever thing for companies to try to master, both as for morale and hiring and just public perception. The other one I thought was funny, not to just give credit to Wiz, but I don't know if you guys

• 1:41:33Logan Bartlett?

  remember this, they like Sentinel One had some company that was agitating to buy them or something, and Sentinel One's like a $6 billion public company. And I think Wiz announced that they were interested in exploring the acquisition of Sentinel One. The Sentinel One CEO is like, fuck off, like, you're not buying us. What are you talking about? But like, you know, it gets reported in that way. So I think Toby's really smart in that regard. And I do think we'll see this divergence of fluency of people's ability to use AI. I still get asked questions from people internally or externally from buddies that are like, so quickly answered by a prompt into a model. And

• 1:42:16Logan Bartlett?

  so I wonder when that behavior shift's gonna happen for people en masse. But I think signaling that that's a requisite thing is smart from an employee standpoint.

• 1:42:25Jordi Hays?

  Speaking of models, did you read AI 2027? And do you think we're just sort of picking up pennies in front of a steamroller right now with all the tariff stuff? Because if, if AI 2027, either path we go on, the forecast basically means the economy will change by like 100,000% or something like that.

• 1:42:47Logan Bartlett?

  It certainly seems, I mean, man, I really hope, I really hope we get the ubiquitous sort of growth in all of this. Remind me, I just saw it tweeted about. What was the, what was the net of AI 2027? What was the takeaway?

• 1:43:01John Coogan?

  Superintelligence by 2027. So extreme compounding growth driven by

• 1:43:07John Coogan?

  AI models that can do their own AI research, starting at the end of this year. No, no hiccup in any of the scaling laws, a quick path to, you know, 10 terawatt.

• 1:43:20Jordi Hays?

  It involves, it involves basically by, you know, 2027, 2028, OpenAI buying every automotive manufacturer and turning them into self-replicating robot production facilities.

• 1:43:32Logan Bartlett?

  I like that. Will we still be able to, will we still have our jobs like screwing, doing the screws into the iPhones? Like power.

• 1:43:41John Coogan?

  That will be in America. Yeah.

• 1:43:43Logan Bartlett?

  So we can do that. Our jobs might be gone. But yeah, that's a, that sounds good. I will say this website's super slick.

• 1:43:51John Coogan?

  It is. It's a really cool website. You scroll down and it like, it updates the probabilities and takes you through all the time. I mean, it's a beautiful feature. People are calling it like science fiction, fanfiction, but I like it. It's entertaining.

• 1:44:01Jordi Hays?

  No, it's a, it's a very cool exercise to go through. It, to me, sort of the great irony of this whole situation is like, right now, no, nobody can talk about anything other than the tariffs and fixating on like, what's the next post on Truth Social? Bull market for Truth Social usage. But, but then, you know, it's possible.

• 1:44:21Logan Bartlett?

  You know, the big winner in tariffs right now is Pete Hegseth, man. I, we were, all we were talking about last week, signal this, signal that, is he in, is he out? And now that is a long since forgotten thing. So I, if there's anyone that I think deserves credit or is celebrating this, I think it's him.

• 1:44:39Jordi Hays?

  Last one for me, underrated voice right now online, anybody breaking through that you think is a good signal?

• 1:44:49Logan Bartlett?

  You know who I, I mean, I, I've sort of appreciated this mix of, of politics, economy and all of, all of that stuff. So I've really, Modest Proposal, I think, has always done a good job. I don't know if you guys follow Buco, Buco Capital. I always find him super entertaining and some of this stuff he's, he's tweeting out. So those are probably the two biggest ones that I've been enjoying of late. But I, I definitely added a lot of econ people to my, my rotation over the course of the last 10 days or something. So.

• 1:45:23John Coogan?

  Yeah. Good time to be an economist. Bull market and economist.

• 1:45:28Jordi Hays?

  I, I've always. I've always honestly thought that you would be the kind of guy to have like a really big alt account that we all like followed and nobody knew.

• 1:45:38Logan Bartlett?

  You know, it's funny is I I feel like I tweet too much of my unhinged stuff. At least I did for a while for my normal account. So.

• 1:45:45John Coogan?

  Well, he does have an alt. He does have an alt, but it's just about basketball.

• 1:45:48Logan Bartlett?

  Yeah, that's right. College football too. I'll sneak in there. I will say I was accused of at different points in time being, um, uh, I don't know, VCs congratulating themselves.

• 1:45:58John Coogan?

  Yeah.

• 1:45:58Logan Bartlett?

  Different things and I'm like, I just, I don't know. It feels, that was, I tweeted unhinged things for my own account. So.

• 1:46:05John Coogan?

  For sure. For sure.

• 1:46:07Jordi Hays?

  Uh, well, looking forward to your, uh, you sort of moderating this debate tomorrow.

• 1:46:13Logan Bartlett?

  If I hang on, will Keith show, is Keith the next guest?

• 1:46:16John Coogan?

  Yeah, he's the next guest. You can hop on.

• 1:46:19Logan Bartlett?

  Should we give a preview? Listen, I, uh, I mean, I teased out from him all of his stated goals of what he was thinking was going to come from all of this stuff. So I hope you guys, uh, you know, pin them down on all that stuff. I need to make sure I have all my prep work done. He's sort of open sourcing the manual to debate him by, uh, by tweeting all his takes. So I, uh.

• 1:46:39John Coogan?

  The, the, the debate that was going on the timeline was just that he's, he's somehow found a way to make, no matter what happens, proof that it's working, which is kind of genius. I like that a lot.

• 1:46:49Logan Bartlett?

  I don't know if I, I probably, can I share on this screen?

• 1:46:52John Coogan?

  Yeah, you can share.

• 1:46:53Logan Bartlett?

  Here, hang on.

• 1:46:54John Coogan?

  Just whatever you share is live, so don't share a password.

• 1:46:56Logan Bartlett?

  Yeah, I know. I know. I know. I need to, I need to make sure I get to it.

• 1:46:58John Coogan?

  Oh, oh, wow. It's the returns from Logan's portfolio. They're fantastic. What a, what a coincidence.

• 1:47:03Jordi Hays?

  60% IRR for a decade?

• 1:47:06Logan Bartlett?

  All these models reaching out to me. It's like, no, I'm married, guys. Take it easy. Uh, let's see. I can't find it. Uh, but it was, it was, oh gosh, where is this? Uh, give me one second here. I'll wait while, uh, while Keith comes on. But it was essentially a meme of like the, oh, here it is. Uh, let's see. How do I share this?

• 1:47:25John Coogan?

  Hey Keith, how you doing?

• 1:47:26Logan Bartlett?

  Great. How are you guys?

• 1:47:28John Coogan?

  You're, you're on with Logan Bartlett too.

• 1:47:31Logan Bartlett?

  Can you see it? Cool.

• 1:47:33John Coogan?

  Prepping for the next, uh, for the next, for the next debate tomorrow, right?

• 1:47:37Logan Bartlett?

  Is my, uh, is my thing coming up or no? Is this prime time and that's the backup? Yeah.

• 1:47:42John Coogan?

  Yeah, yeah, this is prime time.

• 1:47:44Logan Bartlett?

  All right, I'll let you go. Keith, keep open sourcing all the points of your debate. I, uh, I want to hear all the talking points. Uh, just get them out there in the wild for us.

• 1:47:52Keith Rabois?

  Good. One day I'll get you into, turn you into a DJT voter.

• 1:47:57Logan Bartlett?

  Maybe tomorrow.

• 1:47:58Jordi Hays?

  You're gonna convert him from a member of the Panikin Party, which Trump says is a new party based on weak and stupid people.

• 1:48:04Logan Bartlett?

  That's me. I, uh, I actually am getting my, my card and badge tomorrow. It's coming through. So, yeah, yeah, yeah. All right.

• 1:48:11John Coogan?

  You might win the economic department, but you'll lose the dunks for sure. There's no chance.

• 1:48:16Keith Rabois?

  Well, FedEx won a Paul Graham in the UK, too.

• 1:48:19Logan Bartlett?

  Okay. Yeah. You, you can barbly buy in bulk at this point, Keith. You just send them around. So, all right. See you guys.

• 1:48:25Jordi Hays?

  Great to see you, Logan.

• 1:48:27John Coogan?

  Uh, yeah. Keith, how you doing?

• 1:48:28Keith Rabois?

  Great.

• 1:48:29John Coogan?

  Yeah. So you're happy about all this?

• 1:48:31Keith Rabois?

  Well, I mean, obviously there's, you know, volatility, you know, can be terrifying for everybody.

• 1:48:37John Coogan?

  Yeah.

• 1:48:37Keith Rabois?

  Um, but I, I think directionally, the administration has the right strategy, which is we need to address the absurd cost of our debt. We need to rebuild American manufacturing and our certain strategic industries. We absolutely need to have control of our desk, which we learned during COVID. We're massively exposed to strategic weaknesses. We couldn't manufacture even prescription drugs during the COVID, you know, fiasco. And then on top of that, we need to unlock this golden age of prosperity, which does require rethinking, uh, globalism, does require rethinking our tax and regulated, overtaxed and overregulated state. And so I think some people are isolating tariffs as an individual lever in a grand equation.

• 1:49:21Keith Rabois?

  And there's a lot of moving pieces. The country does need to deregulate. Biden alone, just in the Biden administration, we had 1.4 trillion dollars of regulatory costs. Trump will get rid of all of that and go back, you know, and reverse prior administrative buildup of regulatory burdens. That's great. Energy costs soared under Biden. We need to drill baby drill. We need to bring down the cost of energy, which is a major input into goods and services, uh, goods, sub-services like Uber. And you need to invest in the future of technology, which also lowers the cost of goods. But tariffs are also strategic. The best way to often convince foreign countries and nations to do things we need them to do is through what I call economic state crap. And tariffs are a perfect lever.

• 1:50:06Keith Rabois?

  Let me give you two examples. Canada has been has been enabled under the Trudeau regime, an incredibly porous border. And the Mexican cartels took advantage of that and imported fentanyl at massive scale into the United States. And various people in the administration, Biden, the new administration, were complaining about this, but Trudeau administration did literally nothing to seal the border. Think about these, you know, Canadian bounties on their little forces. That's basically the entire security protecting the northern border from fentanyl. And the cartels have been killing Americans through the northern border. So once Trump started threatening tariffs, all of a sudden, even under like the, you know, current regime, which is not particularly conservative, they started cracking down on

• 1:50:51Keith Rabois?

  the border. So we've already seen improvements in interdictions of fentanyl from Canada. All fentanyl, virtually all fentanyl which is manufactured, the precursors are manufactured in China with the knowledge and consent of the CCP. So 100,000 Americans are dying completely unnecessarily because the CCP and indirectly Mexico and Canada aren't willing to do anything about it. Trump has told China and will continue to tell China that when you stop allowing the precursors of fentanyl to be produced in China, we will relax some tariffs. It's much better if 100,000 Americans are alive, even if the stock market goes through a day of turmoil.

• 1:51:28John Coogan?

  What historical precedents are you digging into? We've seen a lot of people calling up Bretton Woods, the gold standard or de-pegging. What are you looking to to kind of inform lessons? Ben Thompson today was writing about how the Nixon shock was received very well from the public. The New York Times was raving about it. The market jumped way up, but over time it became very, it was a very rough decade in the seventies. What are you looking to to inform where we go from here?

• 1:52:04Keith Rabois?

  Well, I think, first of all, just 2017 to 2020, the first Trump administration was a massive success until COVID was unleashed, arguably.

• 1:52:13Keith Rabois?

  You know, intentionally, arguably, through misfeasance, malfeasance or negligence in the American people and the blue states and the blue cities shut down. This was an incredible economy. We had high growth and low inflation, everything you want. And so despite that, despite that three-year trajectory, we also increased tariffs massively strategically. And so, and every economist, by the way, was wrong. There's a list, a laundry list of economists that said tariffs wouldn't work in the first administration. So they were wrong then, and they're going to be wrong now. So that's the most relevant history, and it's pretty predictable. I do think that Ray Dalio's post, which I retweeted, is interesting, which is, this

• 1:52:56Keith Rabois?

  is definitely an intentional strategy to kill globalism and reshape the political order and the global order, absolutely. And so I think the implications of that will take months, years to play out. I don't think you can, you know, look at the stock. I think it's a fool's idea, you know, sort of a fool's crusade anyway, to look at, you know, the hourly or daily trading on the stock market as a, you know, indication of the wisdom or folly of a particular policy. Just today, I love, even up, down, up, down, up. It's crazy to evaluate policy from that perspective.

• 1:53:34Keith Rabois?

  So I do think that we will see this administration execute on challenging the CCP's threat posed to the United States and the democratic order on multiple fronts. AI, winning in AI is existential. On Fed and all, and on their attempt to expand their influence in Taiwan and various other key by-chain moves. I think the United States will be closer to the Monroe Doctrine, if you want to go historical, where expansion of the United States is a positive, expansion of influence, but expansion of landmass. I think the Panama Canal is a very serious agenda item. Greenland is a very serious agenda item for this administration. And we're going to continue to think that way for the first time since, you know...

• 1:54:19Keith Rabois?

  President Monroe.

• 1:54:20John Coogan?

  At the same time, if there is, if the market continues to crash, maybe we even go into a recession for a couple of quarters, you could see consumers tightening their belts, you could see investors tightening their belts. What advice are you giving to founders in your portfolio today about how to deal with, maybe it all works out like you're proposing, but it could be a rough couple of quarters. What are you, what are you advising folks?

• 1:54:44Keith Rabois?

  Well, it's uncertain. So I think the best way to approach from an entrepreneurial standpoint is uncertainty is you have to have scenario planning, probabilistic scenario planning, like if, if accident or you want. However, I don't agree that we will go into a recession. I don't think we should go into a recession. I don't think we should accept that as a reasonable approach. I think we need to cut interest rates, which I think there's going to be some movement on. The evidence is that inflation has been solved by this administration already. You know, you wait for the official government print of the CPI numbers, but there's better and more accurate metrics like call to inflation that show you in real time. And we're down to like a 1.28% inflation. So clearly lower interest rates safely. As I mentioned, energy prices, oil prices, you know, continuing to cross and that's going to

• 1:55:28Keith Rabois?

  continue to happen as long as we explore alternative energy, but drill and proven reserves. So I think those are major inputs in allowing people to spend money. There is a wealth effect and it is important to know, you know, that it's been studied pretty accurately, that if, if people's savings in, you know, 401ks and various other stock-like instruments go down, they may spend less. And that's not necessarily good. Now, I don't think tariffs cause the spending less directly. People talk about tariffs causing inflation. First of all, that's false, like definitionally false. Inflation is the rate of growth of prices. Tariffs are, at most are a one-time price shock. So they can't

• 1:56:12Keith Rabois?

  Positflation by definition. Second, I don't think anybody can easily model the impact. First of all, some countries are clearly going to bring their tariffs on the US down. Maybe not all one hundred and seventy companies, but some are already rushing to the doors. You know, negotiate better trade deals with the United States than we've had in ten, twenty, thirty, forty years. So the net effect of tariffs may not even be, even, may not even raise prices at all. But even if it does, consumers are smart and savvy and they compare and contrast. They substitute goods. So, you know, the price of a, of a good from, let's say, somewhere in Latin America goes up. Maybe the domestic equivalent, Americans substitute for, and that's actually a cheaper product. So you have deflation, if anything, not inflation.

• 1:56:56Keith Rabois?

  And then it's not even that obvious because they, yeah, that's true of competitive, like directly competitive. Let's say you're buying coffee and, you know, coffee from Latin America gets tariffed and goes up, but you can buy like cheaper, but let's say less quality coffee in the States, people substitute, et cetera. But maybe some people just decide to buy a Celsius instead. And like, so all the people who are alleging that there's these studies absolutely do not know how the American consumer is going to substitute from Latin American expensive coffee to American domestic coffee to Celsius and at what rates. And so that's why nobody really knows the net effect. But I think if you, even if you have, I saw Bessin's estimate that even these very high tariffs on, on the CCP in China, which are warranted,

• 1:57:38Keith Rabois?

  probably add something like seventy basis points of cost across all goods from China over five years or something like that. And I don't know exactly how we did the math and I don't have time to like rebuild the spreadsheet. But people definitely are overrating the impact that tariffs have because consumers vote with their feet. And that's part of the point is they vote with their feet for products that are manufactured in America that are not subject to tariffs, whether they're American automobiles. So for example, some people are like, well, why would you, you know, care? Apparently a Chevrolet, like one of these standard model Chevrolet, like SUV things costs a hundred and seventy thousand dollars in Norway. Well, of course, no reasons they're buying a Chevrolet Tahoe, it actually is,

• 1:58:23Keith Rabois?

  at $170,000. Whether they call it a bad or call it some other policy or something less, it's clearly discriminating against American goods and causing Chevrolet to manufacture less than a fair and free market across the world would, you know, sort of naturally stabilize and where equilibrium would be. So we need to address this, but the most important thing is we need to achieve foreign policy objectives. Economic tools are better than military tools. Secondly, we definitely need to crack down on that all. It's, you know, unbelievable how many people died compared to like COVID or Vietnam. And the American people, you know, have accepted politicians doing almost nothing about it, and we need to stop that. And then

• 1:59:08Keith Rabois?

  third is we need to set the platform for a century of prosperity. And eventually, this burden of debt, which is exceeding the Defense Department budget and growing at 40% a year, is completely unacceptable. It was eventually going to crash us into at least a recession, if not something severe, you know, significantly more severe. So President Trump at least has the courage to address fundamental root causes of economic challenges that most American presidents have avoided confronting since the 1980s.

• 1:59:47Jordi Hays?

  In Ray Dalio's post, which you mentioned earlier, he has a bunch of different points. One of them, he says, is sort of part of this whole conversation, which is amazing. Changes in technology such as AI will be highly impactful to all aspects of life, including the money, debt, economic order, the political order, and the international order. There was also a post from a friend of ours, Will Manitis, the other day, where he said, "Worth figuring out what happens if LLM stagnate at one to two acts what we have today. Smart enough to slowly displace all low-skill digital work and things like call centers. No loss for lawyers, doctors, bankers. This is very good for the US and very bad for elsewhere."

• 2:00:30Jordi Hays?

  I'm curious how you think about all of this, you know, sort of drama around tariffs with the backdrop, this sort of like looming, you know, AI steamroller like coming to transform the economy in many ways.

• 2:00:43Keith Rabois?

  Well, this is going to transform the economy, but historically speaking, technology has unlocked new opportunities rather than completely suppressed the ability of humans to thrive. So, for example, when I was growing up as a lawyer, actually, I had a secretary, literally had a secretary. And the idea that an individual associate would have a secretary today makes no sense.

• 2:01:03Logan Bartlett?

  Yeah.

• 2:01:04Keith Rabois?

  But obviously, once, you know, Microsoft innovated with, actually, Microsoft Word for lawyers, actually, that's what it was called, there was, it became less needs for secretaries, but, and my secretary was highly compensated at a law firm in New York City and Washington DC, a hundred-plus-thousand-dollar jobs. These, this whole workforce has migrated into other higher-productive, you know, things to do. And so it'd be inconceivable for me to wake up and, you know, literally expect to have a secretary. Um, so I think that is the history of technology. I think AI will actually displace lawyers, accountants, investment bankers more rapidly than the middle.

• 2:01:44Logan Bartlett?

  Hmm.

• 2:01:45Keith Rabois?

  And certainly faster than manufacturing. I mean, obviously, it's a hyped area of venture now, is robotic innovation, AI meets robots with their software, hardware, the intersection of the two. But if you've ever been in a light industrial warehouse, I, I think that's years out where replacing lawyers, you know, can be done much faster and much better, cheaper, less annoying, replacing doctors. Um, you know, it, uh, the node, Kostla, you know, who runs Coastal Ventures, wrote a paper, I believe in 2011 or 12 about how AI was going to replace doctors. And, you know, I think that is much more realistic in the short term. And they will give people access, lower cost, which will bring healthcare costs, you know,

• 2:02:30Keith Rabois?

  to roughly twenty-two percent of the GDP or somewhere like that now. So if you bring down the cost of healthcare, that also affects whether we have inflation, the disposable income that a consumer has, Obamacare has been a massive disaster, the costs are up five X on the average healthcare plan than before Obama. The American, American people just don't have money to spend on disposable income, on disposable discretionary purchases. So even if tariffs raise things by 1%, if you bring down the cost of healthcare, the cost of energy, allow affordable doctors, you know, there's so many offsets that are much, much better and much more fundamental and durable than worrying about a one-time tariff. Personally, I would go with a flat tariff of like roughly

• 2:03:11Keith Rabois?

  10% and then extremely high tariffs on China. I think Druckenmiller is more right than wrong. But I trust Treasury Secretary to calibrate this correctly.

• 2:03:23Jordi Hays?

  Uh, how do you think about entrepreneurs coming to pitch you today that, that wanna, you know, be a part of this sort of reshoring, onshoring manufacturing? There's fortunately a bunch of companies that have gotten started in the last few years that were focused on manufacturing, but I'm curious, you know, what the playbook sort of you're giving them, how you think about the space and how you think of manufacturing broadly as a venture investable category, if it is at all?

• 2:03:50Keith Rabois?

  Yeah, that's it. It's a great question because, you know, venture is probably like 4% of the capital that funds, you know, sort of startups. And it's not appropriate for many, many, many great or good or great businesses. Venture capital is designed for high-risk, high-reward, explosive opportunities. And those are rare. Manufacturing usually does not meet that standard. It's really hard to scale manufacturing like 1,000x year to year. And so I do think we need to look at alternative sources of capital for innovation in manufacturing. And there will be some where venture is appropriate, but just like there's only some financial services innovation where venture is appropriate, there's only

• 2:04:33Keith Rabois?

  some transportation opportunities, there's only some in health, actually, like what fraction of healthcare, you know, dollar, venture dollars go into healthcare? It's a fairly small fraction. And so I don't think venture is the panacea. I also think to go back one question a bit is, look, when I, I invest in seed rounds and Series A rounds predominantly, that's my sweet spot. I'm taking an eight to 12, maybe 15 year view to what tariffs do today to not be affecting the people pitching me, the people that my evaluation, my criteria for something that's eight to 10 years in the future, completely like ridiculous. That said, anytime there's

• 2:05:16Keith Rabois?

  massive sort of turmoil or flux in a system, it's a really great time for an entrepreneur. So I have a back of thesis that the more flux there is in any market or system, it's a really great time because inertia is not your friend. Let's take a step back as entrepreneurs. Inertia is not your friend as a founder. You have to convert inertia and create momentum in a physics sense. And so when the world is kind of moving around, it's the best time to start a company. So I think now is a wonderful opportunity for everybody who's stuck at some large company, not being challenged, you know, et cetera, to look at starting new companies and be innovative because the world is in flux in all the dimensions that Dalio outlined so well.

• 2:05:59John Coogan?

  Yeah. Can you talk a little bit about deregulation? You said you're optimistic there. On the White House's website, they're kind of claiming that they're not going to create new agencies and there's the one in 10 out regulatory budget, but we haven't heard very many concrete details of what that could look like. What are you optimistic about on the deregulation side? What's the top?

• 2:06:20Keith Rabois?

  Yeah, well, I think that standard of, you know, for every new one, you have to eliminate 10 sounds great and kind of reset the equilibrium. We've been overregulated. I think it's, you know, cabinet secretary, agency specific. And, you know, only recently have we seen the staffing of these agencies, you know, get confirmed by the Senate. You have to remember, the administration starts on January 20th. The cabinet gets confirmed typically pretty quickly, call it a couple of weeks, but then they have deputies, secretaries, undersecretaries. These are the people that are the political appointees that drive the administration's agenda. Most of the departments do not have even half of their political appointees confirmed by the US Senate.

• 2:07:01Keith Rabois?

  So you're asking the secretary, let's imagine like the Secretary of State who's got to, you know, work on the Panama Canal, help negotiate various economic things, solve wars globally, blah, blah, blah, blah, blah. And doesn't have his full staff. Or the, you know, the left is assaulting the administration every day in, in all these district courts. And this kind of absurd district court litigation. Well, it's, it's really unfair to the Attorney General when she doesn't have her team confirmed. Last I looked, and hopefully this has changed or will change immediately. The Solicitor General of the United States, the principal, like appellate lawyer, who's supposed to quarterback all of this strategy, has not been confirmed by the Senate.

• 2:07:43Keith Rabois?

  So people are taking advantage of vacuums in the presidential staffing. And I think this is, you know, artifact of history when the world moves more slowly. Maybe new presidents acted more, you know, cautiously perhaps, but slowly. And so there was more time for an administration to get staffed. But with an agenda where Trump's running a like sort of a no, a no huddle playbook. You know, he's like boom, boom, boom, boom, next.

• 2:08:10John Coogan?

  That's the nicest way to describe it ever.

• 2:08:13Keith Rabois?

  Yeah, and it's intentional, hey, there's a hell of a lot of problems, a lot of things to fix. He's had four years to, you know, contemplate what to do. But secondly, just like the no huddle offense leaves defenses, you know, kind of befuddled. This is intentionally to keep the Democrats and the left, you know, not able to keep up. And that's what's happened. Legacy media can't keep up. Like, what's the latest thing to complain about? Oops, the news changed yesterday. Sorry. Okay, we're on to our next deal. Um, but in any event, you need a more moderate confirmation process, I suspect, to allow an administration to take office with their core team that can execute. Otherwise, you're going to see things, mistakes made, things broken. It's, it's just not, it's not reasonable to ask an administration to fix everything

• 2:08:57Keith Rabois?

  with one tenth their team or one third their team. And so we have to really revisit this. And this is a, this should be bipartisan because there will be a Democrat president. And they're going to want to appoint, he or she's going to want to appoint his or her nominees. And the Senate's going to have to act with this fast to allow that president to execute. And if anything, the velocity in the world with a free form of information, things like X, is going to accelerate, not decelerate.

• 2:09:21Jordi Hays?

  One last question for me and then I'll hand it over to John. Hopefully this one's quick. Do you think we should be taking more decisive action against Unitree Robotics, DJI, you know, groups like that in terms of just blanket bans? Like tariffs are a good start, but potentially not significant enough?

• 2:09:41Keith Rabois?

  Yeah, so absolutely. I mean, we talked about this before, but TikTok is a threat. I think DJI is even worse, probably. And then advanced robots manufactured in China are probably an order of magnitude more threat. And these things could run 17 miles an hour. They have military applications. You know, there's a tweet I posted yesterday that retweeted some of the spy that's already embedded in the Chinese robot.

• 2:10:09Jordi Hays?

  Yeah, for context, they discovered a remote access backdoor in the robot dog from Unitree.

• 2:10:16Keith Rabois?

  Yeah. So I, you know, I think we can take this very seriously. I hope the administration and the legislative branch handle this very quickly. I think there is a lot of attention being paid to this. So I think there'll be some traction here, but absolutely, we need to be very, we need to take this stuff very seriously.

• 2:10:33John Coogan?

  Yeah, I want to let you go, but I want to give you a chance to respond to this Derek Thompson post. He was asking, how do you know if your plan to shock the system is failing? One of the confusing aspects of the tariff defense is the idea that every event justifies the strategy. Stock market goes down, oh, we're just taking our medicine. Stock market goes up, it's so, it's so obvious it's working. Have you had a chance to think more about his, his critique?

• 2:10:57Keith Rabois?

  As I said, it's a very good question because I think anytime you have a new strategy, whether you're in a startup or in politics, you want to have directional feedback. You know, is your nose, you know, nose of the plane going up or down and stuff like that? It's a force crap. So I think on the fentanyl stuff, it's pretty easy. We need less fentanyl deaths, which is less fentanyl being imported to the United States, blah, blah, blah, blah. On the economic front, I think definitely the yields, various yields on our debt are pretty critical. It does seem like that best is managing towards that. I think we need the inflation, we need inflation to stay lower, be slightly lower so that interest rates can come down, which accelerates growth and makes homes more affordable, which is absolutely critical. So I think those are easy, relatively short-term metrics to look at.

• 2:11:43Keith Rabois?

  Whether this whole reinventing the global order is working or not is going to take time, pre your point about Ben Thompson's post about Nixon, that is not going to be measurable, you know, overnight and maybe not even this year. I think we'll have visibility into it by the midterms. Um, you know, with Thatcher and Reagan, the closest metaphors I think about is both Thatcher and Reagan inherited economic basket cases and geopolitical basket cases in many ways. And it took both of them a year or two of pain, but then everything was up and to the right. And, you know, a morning in America, the famous Reagan reelection, Thatcher went through a very tough one or two years when, you know, she mentioned this

• 2:12:24Keith Rabois?

  lady's not returning is because she was actually cutting some spending, allowing for the, the, you know, getting out of stagflation, rebuilding in the military in UK, et cetera. But I think two years is a pretty realistic time horizon.

• 2:12:39John Coogan?

  That's great. Uh, well, we'll let you go. We know you got to get out of here. Uh, but thanks so much for stopping by. Always a pleasure.

• 2:12:45Keith Rabois?

  Always a pleasure. Thanks.

• 2:12:46John Coogan?

  Godspeed.

• 2:12:47Keith Rabois?

  Take care of that.

• 2:12:48Jordi Hays?

  Cheers.

• 2:12:48John Coogan?

  And, uh, our next guest is coming in two minutes, but we got to talk about Numeral Sales Tax on autopilot. Spend less than five minutes per month on sales tax compliance.

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• 2:13:09John Coogan?

  We have a 4.8 on G2 Cloud. That's the review service that's Yelp for SaaS. You know, we love Yelp for SaaS.

• 2:13:15Jordi Hays?

  Again, 4.8.

• 2:13:16John Coogan?

  Uh, they're backed by Y Combinator Benchmark. Go check them out.

• 2:13:19Jordi Hays?

  Benchmark Series A.

• 2:13:20John Coogan?

  E-commerce. I mean, now is the time. You're going to have to be figuring out tariffs. You're gonna, you don't want to be slipping on your sales tax. So head over to Numeral HQ.

• 2:13:30Jordi Hays?

  Just do it.

• 2:13:31John Coogan?

  And I also want to review quickly, how'd you sleep last night? Cause we are sponsored by Eight Sleep, baby. Eight Sleep. Go to eightsleep.com.

• 2:13:39Jordi Hays?

  I had a, it felt rough.

• 2:13:44John Coogan?

  Yep.

• 2:13:45Jordi Hays?

  Still got an 88.

• 2:13:46John Coogan?

  White Lotus threw me off a little bit. I got to bed a little bit later. I got an 86. I only slept for six hours and 34. It was a long episode. It was, it was a 90 minute episode.

• 2:13:53Jordi Hays?

  I was, so I planned my sleep around it being like 50, 60 minutes.

• 2:13:58John Coogan?

  I know. Rugged by Mike White.

• 2:13:59Jordi Hays?

  And then I, yeah, halfway through, I pause it and it's like, or I thought we were halfway through and it was like 54 minutes left. I was like, great.

• 2:14:06John Coogan?

  I, I was rushing to be like, I, I need to start this at 8:30 or else I can't get to bed by 10.

• 2:14:11Jordi Hays?

  You know what? I had no difficulty waking up this morning.

• 2:14:14John Coogan?

  Yeah.

• 2:14:15Jordi Hays?

  In part because of autopilot.

• 2:14:16John Coogan?

  Yeah.

• 2:14:16Jordi Hays?

  I was adjusting the temperature throughout the night.

• 2:14:18John Coogan?

  Yeah. In part because you know, it was going to leak some information. Jordy was repping 225 today, baby. We leaked here. We're going to leak it.

• 2:14:27Jordi Hays?

  I was.

• 2:14:28John Coogan?

  Don't, don't put out a press release. Don't share that. Just leak it out there.

• 2:14:30Jordi Hays?

  Don't share that. But it was, uh, it's Monday.

• 2:14:34John Coogan?

  It's great. Chest day.

• 2:14:34Jordi Hays?

  Which is National Chest Day.

• 2:14:36John Coogan?

  Push day.

• 2:14:37Jordi Hays?

  And, uh, we also, we also got a little sun yesterday.

• 2:14:40John Coogan?

  We did.

• 2:14:40Jordi Hays?

  We were hanging out with Justin Mares and, and I honestly was.

• 2:14:43John Coogan?

  Yeah. We had an in-person guest for our off-pod pod.

• 2:14:46Jordi Hays?

  Yeah. Yeah.

• 2:14:48John Coogan?

  Yeah. You get us together.

• 2:14:49Jordi Hays?

  We got Bryce in the waiting room.

• 2:14:51John Coogan?

  Bryce, how you doing?

• 2:14:52Jordi Hays?

  Wow. Look at this background.

• 2:14:54Speaker 05

  Brethren, I'm doing great. How are you all?

• 2:14:56John Coogan?

  We're great. Um, I mean, things are good.

• 2:14:59Speaker 05

  Was, was Jordy stunting on his reps? How many, did we talk about how many reps he did or was it just 225?

• 2:15:04John Coogan?

  Well, we haven't leaked that.

• 2:15:05Jordi Hays?

  We haven't leaked that.

• 2:15:06John Coogan?

  Yeah. You just want to get the story going in the press. Hey, hey, the company's for sale, probably in the billions. We're not going to tell you exactly how many billions.

• 2:15:13Speaker 05

  No, exactly. X, X is a flutter about this, these reps. They're, they're pining to know.

• 2:15:20John Coogan?

  Yeah. We know you respect the Church of Iron. We've seen many photos. So welcome to the show. You fit right in.

• 2:15:27Jordi Hays?

  Uh, wait, uh, you're traveling now? Is that right?

• 2:15:30Speaker 05

  I am. Yeah. I'm on the road right now in Oakland, California right now, about to head over the Oakland Bay Bridge.

• 2:15:35Jordi Hays?

  Very cool. Well, thanks for.

• 2:15:37Speaker 05

  Of dreams.

• 2:15:37Jordi Hays?

  Into the belly, into the belly of the beast.

• 2:15:39Speaker 05

  Belly of the beast.

• 2:15:41Jordi Hays?

  Uh, what, what, uh, what brings you to San Francisco? Meeting founders?

• 2:15:45Speaker 05

  Meeting founders. We're recording some stuff and, um, I'm trying to get here more consistently. I live in Utah and it's just a quick trip. There's enough going on here that I've recently decided it's going to be kind of a weekly adventure out here to San Francisco.

• 2:16:00John Coogan?

  Nice.

• 2:16:01Speaker 05

  So I'm going to try to, try to keep that pace up for a bit.

• 2:16:03Jordi Hays?

  Wait, weekly?

• 2:16:05Speaker 05

  Weekly. I did that for the first five years of starting OATV back in 05. I commuted here once a week for five years.

• 2:16:14John Coogan?

  I think if you're going to San Francisco, you shouldn't go weekly, you should go strongly. But

• 2:16:17Speaker 05

  Oh, very good point. That's a great point.

• 2:16:20John Coogan?

  But when you're in SF doing business, you want to be there strongly, not weekly.

• 2:16:25Jordi Hays?

  Wait, so, so weekly, I'm just, I'm just curious, not to get too into your personal life, you just get an apartment and like, because you're there so much, or are you a hotel guy? Or a wander guy?

• 2:16:36Speaker 05

  Hotel guy. Hotel guy. I can't, can't, can't do Airbnbs, can't do, can't, you know.

• 2:16:41John Coogan?

  Well, you gotta try Wander. Wander.com, code TBPN.

• 2:16:44Speaker 05

  That was an incredible setup.

• 2:16:47John Coogan?

  Yeah, I mean, I think we'll change it too. We'll have you back on.

• 2:16:52Jordi Hays?

  No, we don't do, we don't do, we don't do your Airbnbs either.

• 2:16:54John Coogan?

  Yeah, yeah, yeah.

• 2:16:55Speaker 05

  But Wander.

• 2:16:57John Coogan?

  Yeah.

• 2:16:58Jordi Hays?

  No, that, that's cool.

• 2:16:59Speaker 05

  I'm gonna have to look into this. What was the, what was the code again?

• 2:17:01John Coogan?

  TBPN.

• 2:17:02Jordi Hays?

  It's easy to remember.

• 2:17:03John Coogan?

  Yeah, you can find your happy place. You can book up Wander with inspiring views, hotel-grade amenities, dreamy beds, top-tier cleaning, and 24/7 concierge service. Basically, Bryce, it's a vacation home, but better. So, yeah, check it out. Wander.com.

• 2:17:15Speaker 05

  Would it be possible to get one with an eighth sleep?

• 2:17:17John Coogan?

  Oh, absolutely.

• 2:17:18Jordi Hays?

  We can figure, our people will talk to your people.

• 2:17:21John Coogan?

  We'll figure it out. Anyway, we wanted to have you on for a real reason.

• 2:17:24Jordi Hays?

  It feels like Indy is, you know, traditional venture firm, but built for good times and bad times, and scary times, and fearful times. And right now, there's been, there's been a lot of fear in the market. You came out and

• 2:17:42John Coogan?

  Are you being greedy while others are fearful?

• 2:17:45Jordi Hays?

  Yeah. It's possible to be greedy, but pragmatic. And I think that, that what

• 2:17:48John Coogan?

  That's what we actually wanted to talk about. Advice for entrepreneurs, founders in the midst of market turmoil. Maybe it doesn't affect their business today, but they're seeing bad news and that's gonna put, you know, you know, their customers are gonna be worried, their employees are gonna be worried, their potential investors are gonna be worried. What advice are you giving to founders these days?

• 2:18:08Speaker 05

  Well, you know, like Jordy touched on, I mean, part of our whole thesis is traditional venture same type of upside, but a different approach to building your business. So, you know, the approach most people take today, you know, they go and raise their seed round, their pre-seed round, or whatever it is. And then the objective of that round is to get to the next and the next and the next. And so you're oftentimes kind of anchoring on what that next fundable milestone might be. And he takes a bit of a different approach. So our companies are kind of, the default we set is like, let's have that be the last round you need to raise. And then you can kind of be a lot more offensive as you build your company. So you don't necessarily need anybody else's permission to exist.

• 2:18:49Speaker 05

  So with that being the case, I think there's kind of two, you know, I tweeted this out last night. We talked about it a little bit, you know, there's kind of a few approaches to take with an indie company specifically. You're, you know, you have, in many cases, you have infinite runway. And so you get to operate and you can message in a very different way. So part of what I said is hunker down, you know, conserve cash. I don't think this environment goes away anytime soon. And so I think people need to be preparing for, you know, to be long-term focused. And what that often means is, you know, getting, getting the house in order.

• 2:19:34Speaker 05

  Because right now we've been playing the lottery and it's time to play, you know, it's time to play chess. I mean, that's, to me, that's a really important distinction. So much of how we've conditioned entrepreneurs is to kind of play for these lottery tickets. So it's all about fundraises, get it in the next round. We're trying to kind of work with people to play chess through this because I think the game has fundamentally changed. As, you know, I, I've been in venture for a long time now. I came in in 2001, so immediately after the dot com crash. So I've kind of lived through the dot com, I've lived through the financial crisis, we've lived through ZIRP. This one, you know, echo is the same, but there's some very fundamentally different dynamics going on here that are going to influence the amount of capital that's available to entrepreneurs over the next few funding cycles.

• 2:20:18Jordi Hays?

  In some ways, we were talking about this earlier with Logan Bartlett, but one thing I've been maybe paying attention to is the categories that felt overheated, AI, defense tech, robotics. In many ways, like the tariffs would just encourage more investment. And I imagine, we had Chris Powers on last week and he's been banging the reshoring drum. But yeah, I guess, do you think that over the next couple of months, we'll see a pretty big slowdown in investment activity or just refocusing?

• 2:21:03Jordi Hays?

  Or are you just less interested in predicting investment volume and more so just in any, whatever the future holds, just run a tight ship?

• 2:21:12Speaker 05

  I think I'm always a fan of running a tight ship. I feel a bit like it's Groundhog's Day today. I'm waiting for Sequoia to drop their memo, that would be the third time. And it does feel like we learned the lesson and then we kind of go right back to the same behavior that got us in the problem in the first place, not globally, but I think specifically to the startup ecosystem specifically. We came through Zerp, everybody wanted to get really tight and then the money started flowing again and basically people shifted to the current narrative, whether that is defense tech or AI or one of these things. I think what fundamentally changes this time is, you saw it last week, Klarna quietly

• 2:21:56Speaker 05

  pulled their IPO on Friday. This, what you would call the denominator effect in venture, that name gets thrown around a bit, so I'm happy to explain it if someone hasn't already hit it today. But I think that denominator effect is probably more pronounced than I've ever seen it in my venture career. And that's going to cause the longer term liquidity issues you're talking about. Jordy, in terms of what the funding cycles look like over the next, call it year or two?

• 2:22:28John Coogan?

  Yeah, can you unpack the denominator effect a little bit more?

• 2:22:31Speaker 05

  I mean, the denominator effect is basically that traditional institutional LPs have allocated a tremendous amount of money to the venture and private equity asset class. So the top line number isn't the, you know, the returns that are coming back from those investments don't come anywhere near to the size of allocations they've already made. So another way to frame that is LPs are out way over their skis on venture and private equity, and there's no, there's no relief coming in terms of returns. So Klarna pulls their IPO, you know, you've got this kind of regulatory uncertainty. There were a bunch of people cashing Figma checks a few years ago.

• 2:23:11Speaker 05

  That never materialized. And so you've got this real issue now that I think is really acute. And I think it's already even starting to show up. Like, if you look at that $40 billion OpenAI deal that that Masa just did, right? How much of that is actual cash? How much of that is credits? How much of that is debt that he's going to have to go out to find and service? Like, the financial market, the financial picture in startups, I think, is a lot more murky than I've ever seen it before. And so counting on either support from your existing investors or a next round materializing over the next 18 months, if you aren't just like absolutely crushing it and putting up insane numbers, like I'm sure most of your audience does.

• 2:23:53Speaker 05

  But in that case, unless you're just such an obvious pick, the sidelines are going to be filled with people cheering for you.

• 2:24:01John Coogan?

  Can you talk?

• 2:24:01Jordi Hays?

  Yeah, I was honestly seeing the tariffs, the trade war. And, you know, if if rates come down, that kind of saving Masa in the sense that pulling together $40 billion by Q1 of next year, which I think is the target, a lot of it's coming from debt. You can obviously secure it against, you know, ARM and whatever else he's doing. But still, it's a lot easier if rates drop, there's a trade war happening. And it's like, where do you put your money if if you want to try to generate any type of return that's not? But who knows? What were you gonna say?

• 2:24:34John Coogan?

  I was gonna ask for a little deep dive on some of the buzzwords in the founder world, specifically the difference between boot scaling and indie. You had a post about this, but...

• 2:24:45Jordi Hays?

  I liked Unicorn.

• 2:24:47John Coogan?

  Yeah, yeah, I want to know more about these like... Yeah, yeah, there's a lot of phrases out there. And I think that, you know, obviously, there's a little bit of hype around these, "What does Founder Mode really mean?" or whatever. But they are useful tools and I'm a big fan of coinages.

• 2:25:01Speaker 05

  Oh, I totally agree. The memetics of it are great.

• 2:25:04John Coogan?

  Yeah.

• 2:25:05Speaker 05

  No, I would say, you know, you touched on a few. I mean, Jordy jokingly kind of amplified one from this morning. Somebody sent me an article they were writing that included indie and they called companies who raise one round of funding with the intent that they're going to get profitable and scale from there as an unicorn. So, you know, only one round. So, people are getting very creative.

• 2:25:29John Coogan?

  Yeah, Zapier is a good example of a unicorn, right?

• 2:25:31Speaker 05

  Zapier's a great example of that. You know, Callanly, until they did their growth round, was a great example of that. I think this is a small but growing cohort of companies that are kind of working towards that as an objective, not necessarily to kind of prove a point, more to kind of control their own destiny and to not be so at the whims of these financial markets that are whipping so intensely. And also, you know, kind of putting their customers before their investors' needs. I think this is kind of a growing, you know, what we see is a really growing trend in terms of, you know, there's kind of this massive wave of returning founders who had built through financial crisis or

• 2:26:16Speaker 05

  built through Zerp, who've kind of lived through this kind of treadmill of an experience as an entrepreneur who are looking for a different way to do it. And we hope we can be their partner. But I think you hit on a few of those other terms, right, of boot scaling. You know, the idea with that one is bootstrap for a little bit and then raise money to scale later on. So, kind of merging those two ideas. The other one, I think, was seed strapping, right? So, again, that idea of...

• 2:26:43John Coogan?

  A lot of portmanteaus.

• 2:26:46John Coogan?

  A lot of court manteaus.

• 2:26:47Speaker 05

  You're like, hey, you know, I know, no judgment, but tech hasn't exactly killed it on the marketing front of way with maybe some of this stuff. But, you know, the idea with seed scale is like raise one round and then scale it, you know, as much as you want on the back of, yeah, I think the tweet you mentioned was like, you know, I basically was framing those two really as like fundraising tactics, you know, that's, that's still fundraising is still core to that idea. And I think with India, you know, what we like to embody is this idea of independence, of this idea of kind of controlling your own destiny, of building things that don't have to ask permission to exist. And I think as we get to, you know, this kind of inflection point in tech, whether it's

• 2:27:30Speaker 05

  in the financial markets or in this kind of new and evolving technologies coming, you know, we want lots of possible futures. We don't just want the one that's blessed by A16Z. We don't just want the one that's blessed by Sequoia. We want, we want futures that could be possible with or without their participation or with their blessings. So I think the world gets a lot less interesting once you start having to ask for permission to exist.

• 2:27:56John Coogan?

  Yeah.

• 2:27:57Jordi Hays?

  Are you, are you bullish on the app layer? I imagine if you want to scale efficiently right now and build an AI, you're not getting into the foundation model business.

• 2:28:09John Coogan?

  Well, I mean, SSI is technically a unicorn.

• 2:28:13Jordi Hays?

  Yeah, yeah, one round.

• 2:28:15Speaker 05

  That's right. Exactly.

• 2:28:17John Coogan?

  Most of the foundation model companies, actually, straight to unicorn, one round.

• 2:28:21Speaker 05

  Yeah, one round. That's it.

• 2:28:22John Coogan?

  They didn't have to raise a ton of rounds to get to a billion dollar valuation.

• 2:28:25Jordi Hays?

  Yeah, but you're, you're, you're going to be an SF, you're going to be an SF later. Like, what are you looking for?

• 2:28:32John Coogan?

  That feels like the place to build an indie company is in the rapper layer that's overlooked by VCs. Maybe it's not a power law company, but you can build a fantastic business delivering amazing stuff. I'm super bullish on it, but I want to know what you think.

• 2:28:43Speaker 05

  No, Super Bull Shana too. In fact, I think you have Rahul coming on after me and we've had this kind of ongoing multi, you know, multi-month, multi-year conversation going around kind of high-status and low-status startups.

• 2:28:56John Coogan?

  Yeah, yeah, yeah.

• 2:28:56Speaker 05

  And, you know, the kind of high-status, have to raise a ton of money, or at least look like you have to, to kind of position like you're really, really innovating. I think those are so, they're such a head fake here in the Bay Area specifically because the kind of social strata is so funny. I think, John, you hit on it. Like, I think that app layer is where so many incredible breakout indie companies can be built because you're now talking about, you know, swapping out any of those models and you get a benefit from all those improvements and just focus on a customer and their needs and the opportunity of a market. I think it's, I think it's a huge opportunity that doesn't feel at all like you have the same kind of network effect lock-ins that you had with like Facebook back

• 2:29:41Speaker 05

  in the day or when Twitter turned off your API access. I think so many of these models are like hyper-competitive in terms of what their performance and output actually looks like, that you can build incredible experiences off of those that can swap pretty easily between them. It's, you know, I would think of them more like moving from, you know, Google Cloud to AWS, right? That feels like more the analogy than like, you know, the dependency of Facebook and their platform.

• 2:30:08John Coogan?

  Yeah, yeah, that makes 10 cents. You got a last question or we're good?

• 2:30:11Jordi Hays?

  No, this is great. I want to ask you how you're, you know, offline, how you're trading the tariffs in terms of like, you know, Japanese fashion and, you know, collectibles, which I'm sure you're, I'm sure you're making.

• 2:30:24Speaker 05

  I knew, I knew the fit check was coming at some point.

• 2:30:26Jordi Hays?

  The fit check, fit check. This is great, this is great. Always a pleasure, Bryce. Have fun, have fun over across the Bay.

• 2:30:36John Coogan?

  Yeah, enjoy it.

• 2:30:37Jordi Hays?

  Looking forward to the next one.

• 2:30:38John Coogan?

  Yeah, we'll have you back on soon. Thanks so much.

• 2:30:40Jordi Hays?

  Cheers. Appreciate it. Take care, guys.

• 2:30:43John Coogan?

  Well, next up, we have Rahul Sonwalkar coming on to talk about Julius. He has a bunch of interesting traction on his startup and just did a podcast with Bryce, actually. But we'll talk to him about rappers and high-status and low-status startups and everything in between as soon as he joins.

• 2:31:03Jordi Hays?

  I'm excited.

• 2:31:04John Coogan?

  In the meantime, if you're looking for something to do while we're waiting for our next guest, why don't you just go sign up for Ramp? Time is money, save both. Easy to use corporate cards, bill payment, accounting.

• 2:31:16Jordi Hays?

  This is a ramp. This is the economy that Ramp was built for.

• 2:31:20John Coogan?

  It really was. You know, during the, during the, the major sell-off post-SVB crisis, like one of my hacks, actually, this is gonna sound like a crazy Ramp ad, but one of my hacks was just cancel all the credit cards in the company and then just reset and you reissue someone a credit card. And then you have some like marketing person who's like, yeah, you know what? I was signed up for like three SaaS products that I didn't need. And I'm just gonna renew the one that I'm using. And when you do that, like now there's like credit card updater that can kind of like get you on anyway. But for a most part, it's just like resetting and it allows you to cut your burn a little bit. But you don't need to do that with Ramp because you have full visibility in this stuff. And if you're actually looking to save money.

• 2:32:01Jordi Hays?

  This is, this is.

• 2:32:02John Coogan?

  This is the best, this is the best product for it.

• 2:32:04Jordi Hays?

  This is, yeah, for my personal card needs, the thing I find most frustrating with credit cards is canceling an Amex card and then seeing the same. I have a VPN that's been charging me for years. I've, I've had, I've called support to try to get them to remove it.

• 2:32:23John Coogan?

  We got Rahul in the studio. Welcome to the show. How you doing?

• 2:32:28Rahul Sonwalkar?

  Thanks for having me, guys.

• 2:32:29Jordi Hays?

  Oh, he's got the suit.

• 2:32:30John Coogan?

  Thank you for dressing up. It's so good to see you, man. It's been way too long. It's, I think it's been like almost two years since we got dinner, but thank you so much.

• 2:32:40Jordi Hays?

  Understood the assignment.

• 2:32:41John Coogan?

  Yeah, understood the assignment. Just quick introduction on you, the company, what you're building.

• 2:32:45Rahul Sonwalkar?

  Sounds good. I'm Rahul, founder of Julius. We're building an AI data analyst. So if you have data on your hands, whether you're working roles like finance, marketing, operations, product, you need to analyze that data, AI can help you with that and Julius is the tool for that.

• 2:32:58John Coogan?

  Very cool.

• 2:32:59Jordi Hays?

  Dude, I'm just gonna start. You have 2 million users?

• 2:33:04Jordi Hays?

  How did that happen?

• 2:33:06John Coogan?

  Yeah, what's the secret?

• 2:33:07Rahul Sonwalkar?

  Yeah, a lot of it is word of mouth and some of it is SEO. So if you look up AI data analysis, Julius is the first result on the internet on all social engines. Basically, it turns out like analysis is a fundamental part of many jobs and people just kind of assume that it's a solved problem. Turns out, most people don't know how to analyze data.

• 2:33:28Rahul Sonwalkar?

  And Julius helps them with that. So I think we kind of found that that need and used AI to solve that problem for people.

• 2:33:36Jordi Hays?

  That's insane. Where should we even start with this?

• 2:33:40John Coogan?

  I mean, I want to talk about just like the culture of this whole meme of like a rapper. I think it's really, I've said this on the show a bunch, but I think it's kind of like a psy out from VCs to like not like for so long. It was like, oh, like you're just going to get steamrolled, steamrolled, like it's not, it's not a viable place to build a monopoly business, a trillion dollar company. That's all you should be focused on. Go for broke. Now we're seeing, oh, the value actually accrues to the application layer. Oh, maybe there are tools that need to be used. But at the same time, like if somebody said, oh, well, like GPT seven might be able to do the same thing as Julius, like I might hear them out on that argument. So how do you process it? And can you take me through your thesis on just companies that leverage foundation models instead of train them themselves?

• 2:34:23Rahul Sonwalkar?

  Absolutely. By the way, shout out to Sam Altman for that steamroll soundbite. I think it really stuck a chord with the VCs, but

• 2:34:33Rahul Sonwalkar?

  look, turns out like, you know, every business out there in the world is solving problem for people, right? And as long as you're building something that solves a problem for people, like that's all that matters. Your users aren't paying for a model, what they're paying for is this tool solving a problem for them. If you can do that faster, easier, cheaper, that's all that matters to your users. Now, in terms of like models and like where does value accrue? I think a lot of early stage founders just get too caught up into that meta level thinking instead of just building something like just go build something, talk to people. See if you can sell to one user, can you sell to a hundred users and then worry about these other things. What the way it has played out is when we started, people told us you're a rapper.

• 2:35:18Rahul Sonwalkar?

  And we would try to like fight that label and then over time we just learned to embrace it. Turns out like these models, they keep getting better. There's multiple model labs, AI labs that are producing really good models. And what that means is The differentiation is actually in the product layer.

• 2:35:35John Coogan?

  Mm hmm.

• 2:35:35Rahul Sonwalkar?

  Can you create a differentiated product and an experience and a whole infrastructure to power that? Um, now, um, is, is that how it's going to play out forever? Depends. Turns out like your, your product needs to have enough of a unique value proposition so that it matters outside of the models themselves.

• 2:35:57John Coogan?

  Mm hmm.

• 2:35:57Rahul Sonwalkar?

  Like, for example, we have this infrastructure for code execution. Every twenty four hours, by the way, every twenty four hours Julius writes and executes over two million lines of code.

• 2:36:05John Coogan?

  Mm hmm.

• 2:36:05Rahul Sonwalkar?

  Um, and to serve that to our users, um, we serve like over a million Jupiter notebooks. Most of our users don't even know what a Jupiter notebook is, right? You're a we of marketing at a, at a big company. You don't know all that technical details. All you care about is analyzing your data. And then how do we build that infrastructure to power that is really important? Uh, and because we have built that models getting better actually helps us build a better smarter product uh, with all the infra and all the UI and the, the interface that we have built.

• 2:36:34John Coogan?

  Yeah.

• 2:36:35Jordi Hays?

  Uh, how do you, uh, how do you think about companies in the space doing anything related to AI? Data analysis, there's companies, you know, coming out, uh,

• 2:36:47John Coogan?

  Some of them have gone like very vertical. Whereas this is just for investment bankers.

• 2:36:50Jordi Hays?

  Yeah, yeah, stuff like that. But, but the, the thing that comes up for me is like, you clearly have chased hype from users versus hype from VCs, right? Cause some of these companies that have come, come out, um, they maybe have like as the same amount of users as they have raised millions of dollars, right? So it's like, you, you know, other, other companies in the space like with like three hundred users, maybe at some cool firms or whatever, you know, raising hundreds of millions of dollars. But I'm, I'm curious, even understanding like adoption at how your tool gets adopted at, at, you know, big companies that might have some crazy procurement process, but then you just have like, they're just signing, going over to Julius and being like,

• 2:37:30Jordi Hays?

  yeah, actually like almost positioning the work that you're doing in Julius as kind of their own. And they're just like pasting in a screenshot to some slide deck or, yeah, I'm curious how you think about adoption and, and maybe like, have, have you intentionally avoided hype throughout this entire process? Um, because like clearly I would say like, yeah, yeah, anyways, just, just take it from there.

• 2:37:54Rahul Sonwalkar?

  Absolutely. So um I think you're spot on. You know, that's how users discover Julius. You know, they're looking for, they're working a job. They need help in the moment to analyze data. They're looking something up on the internet and they come across Julius. Um, and once they start using it slowly, what happens is they're able to first of all bypass all the procurement process and just get the value right away. But then analysis and insights are inherently shareable. So they start bringing their teammates, you know, onto Julius. Especially if it's a manager or an executive that discovers Julius, they bring the whole team with them. Um, this is an early shout out, but we're, we're about to launch real time collaboration in Julius. So you can collaborate on analysis with your teammates in, in the product.

• 2:38:37Rahul Sonwalkar?

  Um, and, and that's going to be huge um for collaboration.

• 2:38:41Jordi Hays?

  How do you, how do you think about uh?

• 2:38:43John Coogan?

  Analysis.

• 2:38:43Jordi Hays?

  You, you, you guys are the AI data analysis company, but how many of your decisions are based on?

• 2:38:49John Coogan?

  Vibes.

• 2:38:49Jordi Hays?

  Vibes.

• 2:38:51Rahul Sonwalkar?

  A, a lot of the, so the, for the channels that are established, for example, SEO growth, all that, we use Julius pretty heavily and it's also very data driven. For a lot of the exploration, that's where we bring in a lot of qualitative data, like talking to five users that are superpower users and observing how they're using the product, what would they need? Um, how do we some, create a simple version of what they need so that many more users can actually access it?

• 2:39:18John Coogan?

  I have a ton of questions on the actual platform. Uh, what models are working the best for you? And what languages are most popular? I know that Python's obviously super popular, but then a lot of data analysis use R and Julia even, which is kind of a funny name.

• 2:39:36Rahul Sonwalkar?

  Uh, yeah.

• 2:39:36John Coogan?

  Are, are you kind of language independent and then you just service the results? And then how much are you swapping models under, based on like what's hot on Twitter today or X? Cause you hear about a new model every day, but then, you know, is it actually worth switching?

• 2:39:51Rahul Sonwalkar?

  Yeah, great question. So for the models, you know, it just changes quite often, but you know, if you're watching this a month from now, it might be a different answer, but you know, usually it's just OpenAI and Anthropic. Doing a lot of the heavy lifting on the model front. Uh, both, both labs have really good models. Uh, we do work with other model providers as well in different parts of the stack. Uh, but usually it's OpenAI and Anthropic doing just a killer job there. Uh, in terms of languages. Turns out like a lot of users don't know what Python is, you know, for them, it's just like something that the AI is doing to do the analysis for them. And they like seeing that, but wh- whether they understand it is, is like not that common among our users.

• 2:40:35Rahul Sonwalkar?

  Python is pretty popular as a default, cause it's just so versatile, right? It's, it's like the most popular language on GitHub. It's got the biggest ecosystem of modules and all that. So it gives you a lot out of, out of the box. Um, there's, there's also um, R that we support and we might add support for SQL at some point in time. Sure, makes sense.

• 2:40:54Jordi Hays?

  Do you think the power of giving anyone uh, in the world access to this sort of complex analysis is under, just like priced in yet? Like, cause to me, cause to me, I think about, okay, every Shopify store owner can now get the power of like this sort of like world-class CFO for basically nothing, right? They have their Julius subscription, but it's not super consequential. That to me doesn't feel priced in because you can enable millions of businesses to run more efficiently and, but I'm curious what you think.

• 2:41:26Rahul Sonwalkar?

  I think the market hasn't priced this in yet. In fact, the cost of getting an insight from the day, from your data has gone down ninety-nine percent in the last two years. And I think most businesses, whether small or big, haven't really like realized that value yet. And if you're a big company, You have to realize that every marketer on your team can now go do really deep marketing analysis, channel analysis within seconds using good product like Julius. Every finance person on your team can get financial insights within seconds or minutes using Julius. And these businesses, when we talk to them, um, most of them haven't priced us in yet. Um, so I think we're gonna see like a big reckoning in the next few years.

• 2:42:07Jordi Hays?

  How do you advise your team around hiring? And how do you think about hiring when you know how powerful these tools are? And, uh, you know, I'm assuming you really push people to say like, you know, do we need to make this hire? Or, you know, I'm, I'm, I'm curious what you think.

• 2:42:26Rahul Sonwalkar?

  Hiring internally at Julius or just as companies?

• 2:42:29Jordi Hays?

  No, no, no, just internally at Julius. Like, you know, today the Shopify CEO came out and with a leaked memo where he was saying like, hey, we're, we need to be AI native. Uh, you need to question every single hiring decision, uh, that, that you want to make. Uh, and compare it to just like getting that same service or value from models.

• 2:42:48John Coogan?

  But it's different at a high growth startup potentially.

• 2:42:51Rahul Sonwalkar?

  I think you guys had Keith on earlier today, right?

• 2:42:53John Coogan?

  Yeah.

• 2:42:54Rahul Sonwalkar?

  He has this like memo about barrel and ammo. Like you, you, you don't want to hire people that are ammo. You don't hire people that are barrels. Like I think what he's looking, what he's basically hinting at is you want to find people that are multipliers. And so we look for people that are multipliers. You give them resources and they find a way to 10x the value creation out of that, out of those resources. And AI is a resource, right? A, a really competent barrel, uh, employee, a really competent multiplier employee can take all the power of AI and just make a lot more happen in a shorter amount of time. And I think that's what we care about when we recruited Julius. So whether it's engineering, like what is their learning rate? Not, not how much, how much like hard skills they have in a particular area.

• 2:43:39Rahul Sonwalkar?

  All of that matters a lot too, but it's, do they have this like massive learning rate where they can just pick up new things really fast? And get really good at it and ship things. Um, for marketing, similar things like, you know, you, you may have experienced this one particular thing, but the game is changing all the time. You have to learn how your users are talking. You have to learn where your users are. Can they learn all that quickly is what we care about. And with AI, it's just the people that are multipliers are going to get so much more productive and get so much more done. Um, and that's, that's how our hiring philosophy works today too.

• 2:44:09John Coogan?

  I have one last question and we'll let you go. Can you tell me about HBS? What's going on at Harvard Business School? How did that come together? Tell me kind of the whole story and how Julius is being used at Harvard.

• 2:44:20Rahul Sonwalkar?

  Absolutely. So Harvard Business School is teaching analysis with Julius, the entire MBA class. So over a thousand MBA students.

• 2:44:27Jordi Hays?

  Wow.

• 2:44:28Rahul Sonwalkar?

  All kinds of backgrounds like investment banking, marketing, product managers, tech executives. All of them are learning to do analysis with Julius because they realize companies have data and business leaders need to make decisions, but analyzing that data is really hard. But Julius just becomes very easy. How did it come about? Well, the professor at Harvard Business School who teaches data stuff, Professor Yav Bojanov, he's a Julius user. He's been a Julius user for over a year before he reached out and said, hey, guys, we want to teach this whole class with Julius. And we said, let's do it. Like, what would you do? And yeah, so they're all learning to use Julius now.

• 2:45:08John Coogan?

  That's amazing. Are you going to scale that to other universities? Or just hope that memetics take hold and everyone copies HBS?

• 2:45:15Rahul Sonwalkar?

  We, I mean, we have a lot of interest from other institutions as well. So like Rice University is teaching a class called AI Financial Analysis with Julius. It's just like this new way to do analysis. It's like the new Excel.

• 2:45:26John Coogan?

  That's cool.

• 2:45:26Rahul Sonwalkar?

  So, yeah.

• 2:45:27John Coogan?

  That's awesome.

• 2:45:28Jordi Hays?

  Is that the prize, by the way, is Excel? You want to just replace it entirely on a long enough time horizon? We won't tell Satya.

• 2:45:37Rahul Sonwalkar?

  Absolutely. Excel, Tableau, all of that, you know, number one business software in the world, Excel. All of that.

• 2:45:42Jordi Hays?

  I love it. Last take, AI 2027. Did you read it? Maybe you didn't have time. Are we all getting paper clipped by a year and a half from now?

• 2:45:52John Coogan?

  What does Julius have to say about AI timelines? Import the GDP growth rate and the energy growth rate and tell me, when will we be paper clips?

• 2:46:01Rahul Sonwalkar?

  Yeah, well, um, I think I think it's a really exciting timeline. You know, I think the best, I think the way to think one, one easy way to look dumb right now is to make a super bold predictions on how the future is going to play out. And so I'm a big believer in like, just, I think it's an exciting timeline and we just have to like, ride the tiger.

• 2:46:19Jordi Hays?

  Ride the tiger. I'm going to make a bold prediction, uh, four million users by end of year for truly say I.

• 2:46:26John Coogan?

  I'll take you over on that.

• 2:46:28Rahul Sonwalkar?

  That's good.

• 2:46:28Jordi Hays?

  I'm happy to.

• 2:46:29Rahul Sonwalkar?

  That's good.

• 2:46:29John Coogan?

  We're going 10 million.

• 2:46:30Jordi Hays?

  Uh, it's great to have you on. Um, we, uh, we got some data to analyze. So you'll, you'll, uh, you'll see us in there.

• 2:46:37John Coogan?

  And yeah, come, come back when there's a new product release or funding announcement. We'd love to have you back on.

• 2:46:42Rahul Sonwalkar?

  I'd love to come back. See you guys.

• 2:46:43John Coogan?

  See you.

• 2:46:44Jordi Hays?

  See ya. Love that he wore a suit.

• 2:46:47John Coogan?

  Yeah.

• 2:46:48Jordi Hays?

  Understood the assignment.

• 2:46:49John Coogan?

  Uh, next up, we got Flo from Lindy, another AI company. You could call it a rapper, but I've seen him doing really, really cool stuff. Um, I'll let him describe it, but I'm excited to, to chat with him and he is in the studio now. Welcome to the stream.

• 2:47:03Flo Crivello?

  Hello. Yeah.

• 2:47:04Jordi Hays?

  Boom.

• 2:47:05John Coogan?

  Uh, how you doing? Uh, uh, thanks so much for joining. Uh, it's been too long, uh, but, uh, good to have you here. Could you just give us a kind of a basic overview of who you are and the company for everyone?

• 2:47:17John Coogan?

  You are on mute. Sorry.

• 2:47:22John Coogan?

  We're lost. We lost audio. We're working on it. We heard him for a second. Okay. Can we talk now?

• 2:47:29Flo Crivello?

  What, what do, can you help me?

• 2:47:31John Coogan?

  Yep, we got you.

• 2:47:32Flo Crivello?

  All right. Uh, yeah, uh, Flo here, uh, founder of Lindy. Uh, we are building a no code platform to build AI agents to automate various workflows. So like sales, customer support, operations, you name it. We automate it using AI agents. Yeah.

• 2:47:47John Coogan?

  Um, I mean, the question we've been asking everyone is like, when can a agent book my flight or something like that? What's your timeline and what milestones are we expected to hit? I guess we're at a big like, big picture level. We're all just waiting for the Studio Ghibli moment of agents. I think we passed the Turing test. Everyone used AI to do their homework. Everyone had that magical experience of like, wow, I'm talking to a computer. And then it faded out and people use it as an answer engine. And then same thing with Studio Ghibli where everyone was like, this is incredible. But now it's like a tool and it's a filter and people use it tastefully and they'll be creative with it. And sometimes they won't.

• 2:48:24John Coogan?

  But when, when do you think and what milestones do we need to hit to get this kind of breakout societal level meme around agents?

• 2:48:36Flo Crivello?

  A year.

• 2:48:37John Coogan?

  A year.

• 2:48:38Flo Crivello?

  I, I broadly buy the meme that 2025 is the year of agents. It's like a year-ish. I think there's been to be a pretty serious inflection point. And, and you know, I, I think like, when you hear this kind of prediction, like a year is qualitatively different from like five years. Cause like five years is like, ah, you know, a year means you see, you see it in the pipeline. I can, can I show my screen?

• 2:48:58John Coogan?

  Yeah, you can. Yeah. Should come up. But whatever you share is live. So if you have tabs open with passwords, we're gonna see it.

• 2:49:05Flo Crivello?

  All my passwords, everything is, is open.

• 2:49:07John Coogan?

  Be, be careful.

• 2:49:10Flo Crivello?

  This is, this is a demo we had of, actually, this is really cool. Cause it's, it's marrying computer use, which we haven't released yet with Agent Swarms, which we released last week. And you can see here, I'm asking an agent like, hey, help me plan a trip to like Brecon Rapids in Colorado. I need to book a flight, find an Airbnb and get a rental car.

• 2:49:30John Coogan?

  Okay.

• 2:49:30Flo Crivello?

  And it's deploying a swarm and check this out. So it's deploying a swarm of three agents, one for each. So it's like booking a flight, finding an Airbnb and reserving a car.

• 2:49:39John Coogan?

  Yeah, decomposing the problem.

• 2:49:41Flo Crivello?

  And it works. It's just, it just works. No interaction, no, no intervention needed. It just works. It's doing all of these things at the same time.

• 2:49:47John Coogan?

  Is this live?

• 2:49:48Flo Crivello?

  Oh, no, no, no, no.

• 2:49:50John Coogan?

  This is a screen recording, right?

• 2:49:51Flo Crivello?

  This is a recording. Oh, yeah.

• 2:49:52John Coogan?

  Okay. This is like really fast.

• 2:49:54Flo Crivello?

  God damn, it works really well. No, no, no, this is, this is the downside today is like it's pretty slow. You can see this is like a six minutes long recording, but in the end it just works. So, yeah, I think like this is going to be in production pretty, pretty rapidly.

• 2:50:07John Coogan?

  Okay, yeah, follow up. Like, uh, part of what made the Studio Ghibli moment so powerful, in my opinion, was the fact that, it didn't require a lot of creativity on the part of the user. And so everyone has a profile photo. Everyone has a photo of their dog or their family. They could just click upload, Studio Ghibli style, and they get something amazing. And, and I think that that's almost as important as the underlying technology to make something go mega, mega viral. Do you think that we're using the right example with Book a Flight? Or do you think, are there any other use cases you've seen where it's like, oh, I could see there's a day when every single person in America or everyone who's online is going to use an agent to do this

• 2:50:49John Coogan?

  because it'll be fun and viral and they'll want to share the results or it'll make their day better?

• 2:50:54Flo Crivello?

  That's a great question. I am actually quite bearish for consumer agents. I think like consumers are time-rich and money-poor, right? It's like they, they, they don't want to trade the time for money like that, which is why I think like Google Assistant and Alexa, like they've been really the failures. And I don't think it's because of the technology. I think it's just like, one, you're time-rich and money-poor. And two, I think the life of a consumer is very convenient. Because on the other side of every transaction as a consumer, you've got a business which interests it is to make the transaction as painless as possible.

• 2:51:25John Coogan?

  Yep.

• 2:51:25Flo Crivello?

  So I actually think like the flight booking experience is fine. I think the restaurant booking experience, I think all of these experiences are kind of fine. I think like there is going to be a transformational moment for businesses where you have like the holy grail of AI agencies, like what we call the, the, the drop-in replacement for a human worker. And I think that's coming in like 12 to 18 months.

• 2:51:45John Coogan?

  Yeah, I, I, I almost, I'm just kind of riffing on this, but I almost wonder if the agent moment will look like the Studio Ghibli moment, but instead of a single picture, you'll say, go and, and do some research about my life or my kid's life or, uh, put in, I'll talk to it for a bit and it just produces an entire. Animated book or something like that. And it's something that requires using multiple systems and writing and iterating and generating images. And so it's still highly personal. And so anyone in America or anyone in the world can get joy out of that experience. But it's something that wouldn't otherwise be created. Like you might stop on a boardwalk and have an illustrator draw you at a carnival. But most people weren't hiring illustrators on Fiverr to turn them into anime.

• 2:52:31John Coogan?

  But they could when it was just one button. And so maybe the maybe the agent use case will be like for for consumers will be de novo. It won't be optimizing something that they're already doing. It'll be something completely new that they would never have paid for. I don't know. What do you think?

• 2:52:43Flo Crivello?

  We'll see. I mean, we had like one competitor that went viral like nine months ago. They did something like that. It was like use an agent to roast my Twitter.

• 2:52:50John Coogan?

  Oh, yeah.

• 2:52:51Flo Crivello?

  Viral and then it fizzled out because like the market is that really? I think safe for this. Even the the the Ghibli thing, I think, is going to eventually fizz out. It's all it is all the health. It's like, I I I don't know that consumers need all that many agents. I think I think businesses need agents.

• 2:53:06John Coogan?

  Yeah. Well, do you think it's a good like marketing strategy at least? Like, have you ever thought about like, how can I get? Even if it's even if it's a meme product or meme use of Lindy. And it's not going to be an enduring or it's going to be extremely high churn. But I know that everyone will sign up for that day, do one task. And yeah, I'll keep 2% of them. But that's a great trade because I figured out how to go viral with my product.

• 2:53:30Flo Crivello?

  That's that's a good point. I think the downside, though, is that, boy, it's so expensive. AI is so expensive. And so that's going to be that's going to be a $10 million bill, you know, like actually $10 million bill.

• 2:53:41John Coogan?

  Yeah, yeah.

• 2:53:42Flo Crivello?

  And like, look, OpenAI is burning money right now on the Ghibli thing. And they don't care because they raised like $40 billion. They have infinite money. If you're a startup, it's, you know, it's a it's a different move.

• 2:53:51John Coogan?

  Yeah.

• 2:53:51Jordi Hays?

  What was your reaction to Toby's leaked memo this morning around, you know, being AI native? Did you? Did you see it?

• 2:54:00Flo Crivello?

  I skimmed it and I forwarded it to the team and I said, "cosign" before I even read it. I was like, "whatever he says, I agree."

• 2:54:07John Coogan?

  That's good management.

• 2:54:08Jordi Hays?

  But do you think CEOs in general have been wary around, you know, being too pro AI in their businesses and not almost like basically scare employees? Because, you know...

• 2:54:21Flo Crivello?

  I don't think it's just about not scaring employees. I think there is a culture in tech of avoiding to be too prescriptive on exactly the how and really leading on outcomes and like letting engineers like do whatever they want and use any ideas they want. And I think that the gap has grown so much now between the frontier of the level of productivity that you can achieve as an engineer and the median practice of the median engineer, especially in big companies, that now employees have no choice but to just lay the law and be like, "hey, this is the tooling we use." Like you don't get to use tooling from like the 1980s anymore.

• 2:54:55John Coogan?

  Yeah.

• 2:54:56Jordi Hays?

  Can you talk a little bit about Linde being sort of multi-product? And I can see a lot of reasons why, you know, for phone calls as an example, you know, there's companies that do, just do that, right? And I could see the reason for Linde to do multiple things is like, you know, a customer does a phone call and then they need an email and then they want a recording and like there's a bunch of, you know, sales, customer support, all these different areas end up, you know, connecting in. So I can see, I can see why you would want to be sort of multi-product. But I'm curious if there's any more, I'm sure you've thought very deeply about that and curious your read on it.

• 2:55:41John Coogan?

  Just being less opinionated about the actual use case for the customer?

• 2:55:44Flo Crivello?

  Yeah, I should think of us, I actually think it's a single product. It's just a lot of use cases. And I think that's an important distinction because the beauty of building it this way is that you build a set of actually few low-level primitives. And then it's like Lego bricks, you know? And then you can combine these Lego bricks however you want and they combine super linearly. And then they explode into this set of use cases. The demo I just gave with like agent swarms and computer use, we didn't have to build this. We just built agent swarms and now we're building computer use. And now these two things, just like, this demo just like... Happens like spontaneously, basically. So it's the same thing for computer use, you know, like when you build a computer use startup.

• 2:56:24Flo Crivello?

  I surmise that maybe 5% of your bandwidth is the actual, not sorry, not computer use phone agents. 5% of your work is actually phone, like phone code and phone whatnot, right? The rest is like the scaffolding around the product, right? Like the the SaaS features around like team collaboration and like the the way to like orchestrate your agent and then to go to market overhead and all of that stuff. And so I'm like, man, if we, it actually didn't take us that long to build the furniture because we have all of that scaffolding around it. And once we have that building block, it's just that much more powerful because it's it's plugged into all of our other primitives. And so you you realize a ton of economies of scale from like a good market standpoint and R and D standpoint. Uh, I think it's a better experience very often for the end user because you end up having all of your AI agents in one place.

• 2:57:09Flo Crivello?

  So you have like one clean pane of glass and you have all of your AI agents in one place. And I actually think it's going to be much more important even once AI agents can actually work together. Uh, you don't want like having all of these different platforms for all of your different AI agents. It's maybe the same thing as having like five headquarters. You want all your AI employees under the same roof able to work together very, very seamlessly.

• 2:57:30John Coogan?

  Can you talk a little bit more about cost? You said that AI agents are very expensive to run. Uh, what are you, what was your reaction to DeepSeek? What's your reaction to Lama four, some of the open source models that might be a little bit cheaper? Uh, what are you monitoring on the inference side?

• 2:57:45Flo Crivello?

  Yeah, I mean, we are seeing costs fall by roughly 40 to 100 X every year.

• 2:57:50John Coogan?

  Okay.

• 2:57:50Flo Crivello?

  So today, you know, we don't have negative unit economics, but our unit economics are actually pretty thin. The margins are pretty thin and we're totally fine with it. And so are investors because we're like, it doesn't matter. Like we have actually seen the the the prices go down by 40 X. So it's expensive today, but it's it's actually still the ROI is tremendous and and soon it's just going to be an absolute number winner.

• 2:58:11John Coogan?

  How much do you think that's driven by um new new algorithms and optimizations versus just new hardware? And uh, put the transformer on silicon or bake the, you know, the the weights of Lama four into an ASIC or something like that?

• 2:58:27Flo Crivello?

  Historically, it's been mostly new algorithms. Yeah, well, you know, or like distillations, you know, for example, GPT for Turbo or like GPT for O is so much smaller than like the original GPT four. Like GPT four was like a 1.7 trillion parameter model and GPT four, I think is like, what, 50B or something like that? Uh, and then, yes, they're all turned up as like quantization and there's like a lot of optimizations at the root of all of the stack. We know that these innovations didn't happen at the hardware level in the time span where we saw these costs fall.

• 2:58:55John Coogan?

  Uh, can you talk a little bit about evaluation of new models? We saw Lama four dropped on Saturday. How does your team actually test that? Do you just roll it out to a small set of users or are you just playing it with yourself? Do you have evals built out? Um, how are you testing new L L Ms when they drop? Cause it seems like it's every week this, uh, this year.

• 2:59:14Flo Crivello?

  Totally. I, I think like, so we do have our own evals built out for like a cool set of use cases that we're going after. And there's a couple of hundred test cases there. Um, and we also test by vibes quite a lot. I will say, uh, I feel bad for saying that because I have friends like the Lama team, but boy like Lama four, the vibes are really bad. Like the evals are good and the vibes are quite bad, actually.

• 2:59:36John Coogan?

  Hmm. What, what, what do you think's driving that? Is that just too much focus on pre-training, which is hitting a wall on the scale side? Or is there something else going on?

• 2:59:45Flo Crivello?

  There are rumors that they injected some data from the evals in the training set at the last minute.

• 2:59:52John Coogan?

  Yeah. Isn't that like data poisoning or something like that?

• 2:59:54Flo Crivello?

  Yeah, yeah.

• 2:59:55John Coogan?

  Eval saturation?

• 2:59:57Flo Crivello?

  Yeah. I don't know if you saw like the.

• 2:59:58John Coogan?

  I saw the allegations.

• 2:59:59Flo Crivello?

  I, I apologize to my Lama friends, but, uh, the VP of AI research at Meta resigned. And so have a couple of members of the core research team, seemingly in protest for what they deem to be unethical practices.

• 3:00:12John Coogan?

  Oh, interesting. We'll have to follow up on that.

• 3:00:14Jordi Hays?

  And is that, you think that just comes down to? Their AI team being on just having so much pressure due to Meta's investment in CapEx. And it's like, if you're not best in class, it's just clearly, you know, what are you doing? Basically?

• 3:00:31John Coogan?

  If you're not first, you're last.

• 3:00:33Flo Crivello?

  I think Zach is massively raising the temperature and I think he's basically threatened to like, destroy the whole org or like fire happy org or like similar stuff like that. Uh, if they don't hit certain targets by a certain date, and I think that's led to this outcome.

• 3:00:48Jordi Hays?

  How, uh, how, how do you think about AI adoption in enterprise? But you're sort of B to B SMB broadly, because I'll give you an example. So, and I brought this up a few times on the show, but during, during the Studio Ghibli moment, uh, if you had a post go viral enough, people would, would respond to it and not know where it was being created, seemingly unaware of OpenAI ChatGPT broadly. When you talk to business owners today that are maybe outside of Silicon Valley and you explain to them what's possible for AI, with AI, are they, are they surprised? Are they aware of this stuff already?

• 3:01:30Jordi Hays?

  Do you think they're, they're quick to adopt, uh, these products? Uh, you know, I'm curious.

• 3:01:36Flo Crivello?

  People are aware, definitely. Uh, we're, we're seeing some very interesting dynamics play out in the market where SMBs are aware and they are eager to realize media or AI. So SMBs are actually the ones who have, in my mind, the most real deployments out there. They are actually deploying agents for mission critical stuff all day long. Enterprise customers are interesting because there is, I think AI agents, there is a little bit of a return of shelfware. So you know, shelfware is like that thing that happened in like the 2000s or like the 90s, like Microsoft and Oracle, like just like release this software, very expensive and everybody, the enterprise customers buy it because the pitch is compelling. But then it gathers no adoption internally, so it just sits on the shelf.

• 3:02:19Flo Crivello?

  And, and I think that's happening again with AI agents because a dynamic will seem to play out quite a bit. And I don't want to say names, but there are some very hot AI startups out there in the enterprise that are basically shelfware. Like their revenue is skyrocketing and they're meeting very good adoption internally. And what's happening is that the board is on Twitter all day and they're freaking out. And they're on the back of the CEO and they're like, you've got to figure out this AI thing, whatever it means to figure out this AI thing. And then the CEO turns around and talks to his executives and is like, you guys have got to figure out the AI thing. Basically, the sheet rolls downhill and immense budgets get unlocked, like hundreds of millions of dollars, like figure out the AI thing. And so, you know, we we are seeing these huge A R R numbers, these huge growth numbers.

• 3:03:02Flo Crivello?

  Adoption is is low very often and even when adoption is there, satisfaction is is low because the the the products are not quite mature yet. And even when the products are adopted, they are not typically for very mission-critical tasks yet. Like enterprises are notoriously, and I think for good reason, quite risk averse. And so they're going slowly here as far as like actual adoption and deployment is concerned.

• 3:03:25Jordi Hays?

  Yeah, that makes sense. Do you think about, how do you think about

• 3:03:29Jordi Hays?

  general risk of rolling out these products, right? If you're using Cursor internally to write code and help you ship faster, there's, you know, if you make, if the, if Cursor makes a mistake, you know, you sort of can have the opportunity to correct it. The customer doesn't, isn't necessarily made of, aware of the mistake. Whereas there's a bit more risk with with what you're doing, right? If if a customer gets an email and it doesn't make any sense, or they're on the phone and and they're talking to an agent and the the agent is just sort of stumbling or whatever. I'm curious how you think about, you know, testing. I'm sure you're doing a massive amount of testing internally and then making sure that that these things are functioning before they're really,

• 3:04:14Jordi Hays?

  you know, being rolled out at the customer level. But I I'm curious what your approach is there.

• 3:04:22Flo Crivello?

  Well, first of all, I I always tell people to compare apples to apples, which is like, the the the bar is much lower for agents than it is for other software. For other software, you want like three or four nines of reliability or what or whatnot. Agents, the comp is not other software, it's it's humans, right? And when you hire humans, and very often enterprise customers, they have their support done by BPOs in the Philippines or in India or whatnot. The quality is not a hundred percent, right? And so you've got to compare, you've got to compare this to that. So the vast majority of the time for use cases where AI agents are deployed right now, they more than clear that bar of human quality and then sub, right? Because they are, obviously, they are available 24/7, they respond to tickets in like a couple of seconds, and then they give you perfect observability.

• 3:05:07Flo Crivello?

  So you can actually see exactly task by task what your AI agents did like all day. You can't say the same for for for for humans. And then on top of that, with this noted, which is like, hey, headline, it's fine. AI agents work pretty well. But, you know, on top of that, what you do is obviously you deploy evals. You deploy human in the loop for like the most critical parts of a workflow. So for example, customer support agent. If you're Uber, we don't have Uber as a customer, but I used to work at Uber. If you're Uber and a customer complains about like a sexual assault, don't have an AI. It's just like a scale it up to a human, right? Or if a customer is asking for a refund on a transaction of more than call it like $500. It's kind of set to a human, right? And you can have these hard guardrails in place that are like, this action always structurally

• 3:05:51Flo Crivello?

  requires a human in the loop for the AI agent to perform it.

• 3:05:55John Coogan?

  Makes sense. Can you talk a little bit about distribution with a lot of these B two B products you hear? Oh, yeah, anyone can set up a Shopify store. Anyone can set up QuickBooks, but oftentimes these products are actually vended into companies from agencies, consulting groups. There's actually a like a middleman that's that's doing the implementation and the maintenance of the software. And in some cases, the companies don't even know that their emails are being sent by Mailchimp under the hood or Klaviyo or any of these different SaaS products. Are you finding, do you think that'll be a material part of your business? Or or are you thinking about that?

• 3:06:32Flo Crivello?

  Yeah, it is a material part of the business today. We have a partner network. If you go to like lindy.ai slash partners, we've got like dozens of implementing partners that that help us implement these things. I think it's temporary, though, because AI agents are soon going to be simple enough. Again, if you have a drop in replacement for a human worker, it's going to be no more complicated than collaborating with your human teammate. So I don't, I don't know that you're going to need this for all that long.

• 3:06:56John Coogan?

  How do you think about collaboration between agents? I was reading the AI 2027 thing and they were talking about, oh, well, like when there's a billion AGIs, they'll just set up a Slack workspace and they'll talk to each other literally in Slack. You you gave that demo of the three agents working on separate things. And then I imagine that their results are kind of put together. Are you thinking about communication between the agents during the process? Because you could imagine that. Oh, it finds a great, it finds a great place to stay while you're traveling. But that requires taking a slightly different flight and there's a trade off there. And if you had a really great human working on booking you a trip that involved a flight and a, and a stay,

• 3:07:39John Coogan?

  that they might want to talk to each other about the trade offs there and kind of do some sort of optimization. You don't just want to book the flight and then also book the best hotel or whatever, because they might not be the same.

• 3:07:50Flo Crivello?

  Yeah. Oh, and so this is currently something we support. So for example, like we do a lot of recruiting, you know, engineers or designers or salespeople, anything, we're hiring everything, hit me up. But you know, I have a Lindy that's really good at sourcing candidates. And then I have a Lindy that's really good at reaching out to them. So she performs research about them. She knows exactly how to reach out to each person and all of that stuff. And so these two Lindys are in, are in touch with each other. So one finds candidates, the other reaches out to them. Yeah, I, I, I think that's going to be super important. And that's part of why we are so passionate about having all of the agents in the same platform. You could say you don't need them in the same platform because they can use platforms like Slack and whatnot to, to collaborate. But, and that is part of the AI twenty seven, uh, twenty twenty seven essay, right? He, he talks a lot about neural ease.

• 3:08:33Flo Crivello?

  He says like agents are not always going to communicate with each other in, uh, human readable tokens. And, and that was a part of our thesis. And so that's going to be much easier for AI agents to do if they are part of the same platform. I think ultimately this, like the AI agent team topology is going to be one of the main triggers of the performance of your, of your AI agent setup. And I think at first it's going to be on you as a user to figure out that topology. In a way, you're going to be doing the, the job of a CEO. It's like, hey, what's the reporting structure? Who communicates to whom? How? Like all of that stuff you're going to have to design. Eventually, and in the not too distant future, you are going to have an AI agent design, design that for you. So we call that the AI chief of staff that's just going to manage all of your AI agents. And you can imagine this recursivity, right? Just like agents managing agents, managing agents.

• 3:09:19Jordi Hays?

  What's your P doom? Are you scared? Uh, does AI, does AI scare you? Or are you just like, no, we're putting them to work?

• 3:09:26Flo Crivello?

  I'm terrified. Um, my P doom is about, I look, I flipped to edge, the error bars are, are huge, but like.

• 3:09:35Flo Crivello?

  Look, even if it was low, like 10%, that's unacceptably high. If you listen to the Dorkish Podcast on AI 2027, that's the part, I love Dorkish, I love the podcast, but that's the part where I'm like, what? At some point, they talk about Pidume, and one guy is like, yeah, I'm 70%. And the other guy is like, I'm an optimist, I'm only 20%. And then they move on. I'm like, can we spend the whole conversation talking about the fact that like very credible, very smart people who spent a lot of time thinking about this, literally think that there's a 20% chance that we as a civilization go extinct in 10 years? Like, I'm very fine. I think it's very under discussed. I think it's pretty, and I think that's

• 3:10:10Jordi Hays?

  Is it possible, is it possible that Lindy at some point pivots to being a defense company, but you guys are deploying agent swarms to fight the our robot adversaries?

• 3:10:22Flo Crivello?

  Look, you know, we're selling to SMBs. We are a humble AI agent company.

• 3:10:31John Coogan?

  I mean, I want to talk about something very anodyne compared. Just the idea of like putting an agent on a cron job, that feels like something that's, that's potentially so simple, but very value creative. Just, okay, I have a task that I need to do, and I want to make sure it happens every single day. Are you seeing traction in that vertical? Or are you messaging that type of activity? And what are the, what are some of the cool use cases? Like, do you have any like cron jobs set up where an agent does something for you, even if it's simple, just checking a newsletter, checking a website, just doing something pretty simple, but it's something that happens reliably every day?

• 3:11:13Flo Crivello?

  Oh, I have it done. I have it done. So I have one that actually I received the email from this morning that checks out my favorite podcasts every week. And because I don't really listen to podcasts anymore, and so it just like takes the podcasts, transcribes, transcribes it and sends me a summary of my favorite podcasts every week. I have a couple that ping me on Friday nights that, so one of them looks at my calendar and tells me, like, and looks at my priorities and tells me whether my calendar is aligned with my priorities. One of them looks at my personal CRM and at my calendar and is like, hey, you met with this guy this week, he seems interesting, you should hit him up. One of them, one of them looks at all, because I have a Lindy in all my meetings. And so she looks at all my meetings for this week, and she sends me a digest of all my meetings this week.

• 3:11:57Flo Crivello?

  We have one that like every day This one is really powerful, actually. It's my favorite. It's company-wide. So every day it ingests a ton of information from the company. So every external meeting we had with customers, every support ticket we received, like a lot of communication. And then it sends a company-wide digest to the whole company, like the general channel on Slack. So like in a couple of bullet points, you get like that heartbeat of the company.

• 3:12:19John Coogan?

  Mm-hmm.

• 3:12:19Flo Crivello?

  That's been one of the most surprising use cases to me is AI agents are really good at just ingesting a ton of data very rapidly and summarizing it. So writing reports is a really, really strong use case right there.

• 3:12:30John Coogan?

  Do you need a larger context window for that larger task? Or does it work with any of your models?

• 3:12:35Flo Crivello?

  I mean, modern models have like 200,000 tokens context windows. That's enough for like a 150 pages book or something like that. That's plenty.

• 3:12:43John Coogan?

  Okay, last question, we'll let you go. What about the name? This seems like the least Lindy company possible. It's like very new age and futuristic and sci-fi. Is it a reference to the Lindy effect, or did you just like the name?

• 3:12:57Flo Crivello?

  No, we have a teammate named Lindy, actually.

• 3:12:59John Coogan?

  Oh, okay.

• 3:13:00Flo Crivello?

  Yeah. And so we were just like looking for a name for way too long. And then she was in a room who will bring something. He's like, how about Lindy? And so, yeah, all right, Lindy.

• 3:13:07John Coogan?

  That's great. I love it.

• 3:13:08Jordi Hays?

  Can never leave now.

• 3:13:09John Coogan?

  Yeah.

• 3:13:09Jordi Hays?

  You gotta stay.

• 3:13:10John Coogan?

  Do you have a last question?

• 3:13:11Jordi Hays?

  No, this is great. This is great.

• 3:13:12John Coogan?

  Thanks so much. Yeah.

• 3:13:12Jordi Hays?

  We gotta get some Lindys going internally at TBN.

• 3:13:15John Coogan?

  I love it.

• 3:13:16Jordi Hays?

  And yeah, it's great to have you.

• 3:13:18John Coogan?

  Where can people sign up, get started? What's pricing look like for your average consumer B2B?

• 3:13:22Flo Crivello?

  Yeah, go to lindy.ai and don't worry about the price. It starts at $50 a month. Yeah.

• 3:13:28John Coogan?

  Okay.

• 3:13:29Flo Crivello?

  And we also offer, to my point about the implementation, like, you know, if you've got stuff you want to automate, hit us up. We're used to implementing Lindy's for people.

• 3:13:35John Coogan?

  That's amazing.

• 3:13:36Jordi Hays?

  Amazing.

• 3:13:37John Coogan?

  Well, thanks so much for joining.

• 3:13:37Jordi Hays?

  Great to chat, Flo.

• 3:13:38John Coogan?

  This is fantastic.

• 3:13:39Flo Crivello?

  See you.

• 3:13:39John Coogan?

  Talk to you soon. Bye.

• 3:13:42John Coogan?

  That was great.

• 3:13:42Jordi Hays?

  P Doom.

• 3:13:43John Coogan?

  That was a great day. Yeah, he writes about it a lot on his, on his, on his X. It's always scary when you talk to somebody who's close to the metal and terrified of the metal.

• 3:13:53Jordi Hays?

  Yeah, but I feel safe knowing that he could turn his swarms against, you know.

• 3:13:58John Coogan?

  That's all that matters, is this more good robots than bad robots, and we win.

• 3:14:02Jordi Hays?

  Yep.

• 3:14:02John Coogan?

  But hopefully, hopefully we outnumber them. Anyway, any other posts you want to do from the timeline? Or should we get out of here?

• 3:14:09Jordi Hays?

  No, I honestly was just looking at Polly Market pulled up. I was tracking. I don't know how this.

• 3:14:16Jordi Hays?

  This feels, um, it's crazy. You know that poly market right now is only has a 1% chance of a US recession before May 2025?

• 3:14:25John Coogan?

  Well, that's like, it would be very, very hard for it to happen in May. Because a recession is designed as

• 3:14:30Jordi Hays?

  They would have to like rewrite the data, like

• 3:14:34John Coogan?

  Yeah, yeah, yeah. So recession is defined as like, uh, I, I think it's actually just, it's usually defined as like multiple quarters of

• 3:14:40Jordi Hays?

  Oh, right. It has to be. So, so, so it's basically impossible.

• 3:14:45John Coogan?

  Yeah, yeah. It's basically impossible.

• 3:14:47Jordi Hays?

  Unless they were to basically get new data, old data.

• 3:14:51John Coogan?

  Old GDP data because, I mean, these, like, the market is a leading indicator. Right now, you're seeing people, I mean, even on the show, we're talking about, will companies pull back? Maybe they will. Will consumer stop buying foreign-made cars? Will they stop buying cars overall? Or is there going to be inflation? Like, we have no idea what's going to happen to the, to the business community or the, or the American consumer. And so for GDP to just suddenly shrink, it would be very rare. Unlike what happened in COVID where, you know, all the businesses were closed immediately and there was a massive drop in GDP very, very quickly. They all came back. Uh, this is very much, I mean, you talk to the smartest people in the tech and finance world and they're all saying some version of,

• 3:15:33John Coogan?

  let's wait and see. I don't know. The, the market's down. It doesn't seem great, but maybe it'll work out. I don't know. I'm kind of just doing the same thing. I'm focused on AI or whatever. And so I'm sure there's a lot of people that, yeah, they're, they're upset that the market's down, but they're not fearing for their jobs or really like pressing pause on that purchase or that vacation.

• 3:15:52Jordi Hays?

  Yeah.

• 3:15:53John Coogan?

  They're just kind of continuing on. Anyway, uh, we'll be digging into it more throughout the course of the week. So stay tuned. And other than that, thanks for watching.

• 3:16:02Jordi Hays?

  Thank you. Uh, it's going to be a great week.

• 3:16:04John Coogan?

  Yeah.

• 3:16:05Jordi Hays?

  Bye. Talk soon.