Did OpenAI Steal the Navier-Stokes Solution? | E2335

This Week In Startups is made possible by: Northwest Registered Agent - https://www.northwestregisteredagent.com/twistdomain NetSuite - https://www.netsuite.ai/twist Vanta - http://www.vanta.com/twist Check out a full transcript and summary of today's show, created by Plaud: Today's show: An Anthropic researcher quit this week, saying both leading labs are gambling with everyone's lives. His coworker chimed in and predicts there is a greater than 10% chance that AI will end humanity IN THE NEXT 10 YEARS. Jason and Lon take it to Yohei Nakajima of Untapped Capital, Ben Lerer of Lerer Hippeau, and Rebecca Lynn of Canvas Prime, who cannot decide whether it is the greatest PR strategy in history or some kind of mass psychosis. Learn why Jason says founders should never hand a frontier lab their proprietary data, whether or not they're offered free credits. PLUS, who really solved Navier-Stokes, and what does the OpenAI–Buckmaster fight mean for anyone doing real work inside ChatGPT or Claude? Guests: Yohei Nakajima on X: https://x.com/yoheinakajima Untapped Capital: https://untapped.vc/ Ben Lerer on X: https://x.com/BenjLerer Lerer Hippeau: https://www.lererhippeau.com/ Rebecca Lynn on X: https://x.com/VCRebecca Canvas Prime: https://www.canvas.vc/ Relevant Links: Jacob Coxon quits Anthropic - "gambling with our lives" https://techcrunch.com/2026/09/09/gambling-with-our-lives-anthropic-researcher-quits-warns-against-self-improving-ai/ Evan Hubinger, Anthropic's Alignment Science lead, on X: >10% odds within a decade — https://x.com/EvanHub/status/2097497037956891126 Future of Life Institute — the 2015 Puerto Rico AI safety conference Jason asks Lon to pull up → https://futureoflife.org/ Meta debuts Muse (Axios) —https://www.axios.com/2026/09/08/meta-debuts-muse-personal-ai-agent Harmonic — https://harmonic.ai/ China blocks Meta's Manus acquisition (CNBC) —https://www.cnbc.com/2026/04/27/meta-manus-china-blocks-acquisition-ai-startup.html OpenAI fought dirty— https://techcrunch.com/2026/09/08/openai-fought-dirty-on-career-making-math-problem-says-nyu-mathematician/ Savvy Wealth — https://www.wealthmanagement.com/ria-news/savvy-wealth-raises-100m-valuation-hits-600m Augmodo — https://www.augmodo.com/ E2B — https://e2b.dev/ Daptic — https://www.daptic.com/ Timestamps: 0:00 Jacob Coxon quits Anthropic: "crunch time" and "endgame" 4:53 Evan Hubinger: >10% odds AI kills all humans in a decade 11:22 Northwest Registered Agent - Got a new business idea? Northwest Registered Agent helps you bring it to life. Get a free domain, email, phone number, and more - with no purchase required! Learn more at https://www.northwestregisteredagent.com/twistdomain 12:23 "You have succeeded in scaring the bejesus out of Americans" 14:59 Jobs, the wealth divide, and which industries get wiped out first 20:07 NetSuite - For the first time ever, you can try NetSuite Next for free. If your revenues are at least in the seven figures, go to https://NetSuite.ai/TWIST 21:09 Savvy Wealth's $100M round 26:52 The Kalanick story and why Jason built a syndicate backstop 29:04 Vanta - Get $1000 off your SOC 2 at https://www.vanta.com/twist 30:16 Plaud: If your work depends on conversations — interviews, meetings, calls — you need a Plaud NotePin S. You can check it out at https://Plaud.ai/twist and use code TWIST for 10% off! 32:05 Meta ships Muse 32:56 Can Meta be trusted 35:29 Threads Metrics 49:27 Robinhood's free-share referral 51:16 NYU's Tristan Buckmaster accuses OpenAI of fighting dirty on Navier-Stokes 57:43 Jason: "It's a trap" 59:03 Harvey goes open-weight, Go. AI on-prem, Covenant Labs 1:12:22 High performing portfolio companies Subscribe to the TWiST500 newsletter: https://ticker.thisweekinstartups.com Check out the TWIST500: https://www.twist500.com Subscribe to This Week in Startups on Apple: https://rb.gy/v19fcp Follow Lon: X: https://x.com/lons Follow Jason: X: https://twitter.com/Jason LinkedIn: https://www.linkedin.com/in/jasoncalacanis Check out all our partner offers: https://partners.launch.co/ Great TWIST interviews: Will Guidara, Eoghan McCabe, Steve Huffman, Brian Chesky, Bob Moesta, Aaron Levie, Sophia Amoruso, Reid Hoffman, Frank Slootman, Billy McFarland Check out Jason's suite of newsletters: https://substack.com/@calacanis Follow TWiST: Twitter: https://twitter.com/TWiStartups YouTube: https://www.youtube.com/thisweekin Instagram: https://www.instagram.com/thisweekinstartups TikTok: https://www.tiktok.com/@thisweekinstartups Substack: https://twistartups.substack.com

• 0:00Speaker 00

  NYU mathematician Tristan Buckmaster put out a statement saying OpenAI only started prompting its model on this problem after word of his own work reached the company.

• 0:09Speaker 01

  Not surprised at all. You look at the Youtubes and the drop boxes and the like, right? I mean, it's a common trend.

• 0:15Speaker 02

  Trust these companies with your data at your own peril to some degree.

• 0:18Speaker 03

  In the scientific community, right, where people are very conscious about what they share with who because they want to control who builds on top of their work. And if you start doing that work in chat GPT Claude, there is a possibility that it makes the next researcher find that direction faster. Agents are scraping the entire web, looking for partial solutions and can build on it. So the importance of like locking in your research becomes increasingly stronger.

• 0:42Speaker 00

  I would not trust them with anything that's important or proprietary. This idea that you're going to give instinct or Zuckerberg, your Gmail, then your Notion, then your docs, then your databases means they're going to steal your IP, train it, and then give it to your competitors.

• 1:00Speaker 04

  This week in startups is brought to you by Vanta. Compliance and security shouldn't be a deal breaker for startups to win new business. Vanta makes it easy for companies to get a SOC 2 report fast. Get $1,000 off for a limited time at www.vanta.com/twist. And NetSuite. For the first time ever, you can try NetSuite next for free. If your revenues are at least in the seven figures, go to netsuite.ai/twist. Built for every industry, ready for every boardroom. netsuite.ai/twist. Northwest Registered Agent. Got a new business idea? Northwest Registered Agent helps you bring it to life. Get a free domain, email, phone number, and more with no purchase required. Learn more at www.northwestregisteredagent.com/twistdomain.

• 1:43Speaker 00

  All right, everybody. Welcome back. This week in startups, we do our This Week in VC Roundtable every Wednesday. What do we do on this roundtable? Well, Lon reads the news. I do a bit of moderation there. And we have three great guests who are active investors in startup companies. And we've got quite a lineup today. Lon, introduce our guests, please.

• 2:04Speaker 05

  Yeah, well, first up, we've got Yohi Nakajima. He is the general partner at Untapped Capital, and he also runs Agent Fund, a 2025 Angel List rolling fund for autonomous agent startups, plus Ben Leir. He's the co-founder of Leir.

• 2:20Speaker 00

  Major firm. What a guest.

• 2:22Speaker 05

  C firm. He started in 2021. Finally, we've got Rebecca Lynn. She's the co-founder of Canvas Prime and a five times Ford Midas list entrance.

• 2:34Speaker 00

  There you go. There you go. Welcome, everybody.

• 2:36Speaker 02

  Jason had no idea that I was on. He's just like, oh, my God, like.

• 2:40Speaker 05

  I was hamming it up a bit.

• 2:42Speaker 02

  I mean, come on, man.

• 2:42Speaker 05

  A little hamming.

• 2:43Speaker 01

  Ben showed up. Amazing.

• 2:45Speaker 00

  I mean, you know, whatever.

• 2:48Speaker 00

  Listen, we have got a crazy docket. And Lon, I guess we have to talk about the end of the world and how we're all going to manage that because, you know, typically our funds last 10 to 15 years. But right now, I'm trying to figure out how to get DPI if in fact the world is ending in 10 years or 2030, according to Anthropic. So let's discuss this for the 50th time this year. Anthropic people quitting, and OpenAI folks have done it as well. But let's discuss people quitting because they saw into the black AI box and decided it's the end of days and we're all going to die.

• 3:30Speaker 01

  But he's just going to start a hedge fund or a venture fund, right, Jason? I mean, isn't that what's coming next? I expect that to be the next announcement.

• 3:37Speaker 00

  That would be, that would be. Lon, tee it up for us. Who is this lunatic? And then his coworker lunatic who decided he would retweet it?

• 3:47Speaker 05

  So this is Jacob Cox. And he's a 27 year old pre-training researcher, spent three years at OpenAI, credited as a core contributor to GPT-4O. Before moving over to Anthropic in July, he joined Anthropic specifically because of its safety reputation. And about two months later, he quit the company and the industry entirely in a seven post thread on X that already has tens of millions of views. He told the Wall Street Journal that researchers inside these labs have started using words like crunch time and end game, and that by the end of next year, some of the most aggressive scenarios could already be out of control. Then it got stranger because two current Anthropic researchers publicly agreed with him, including a Lion, Mint, a Lion and Scientist lead Evan

• 4:31Speaker 05

  Huthinger, who said that he personally puts the odds of AI killing all humans in the next decade around 10%, give or take 10% chance we all die. And all this is landing while Anthropic, of course, reportedly heading toward an IPO at something like a $2 trillion valuation with its safety first reputation as a central part of the pitch to investors. Yohi, what are you making of this latest instance of doomerism?

• 4:59Speaker 03

  I mean, it's going to continue, right? We're going to continue to see incidents like the hugging face. There are going to be things where we see a hint of AI doing something bad and we're going to see what if this happens at an exponential scale. The conversation is not going to end, but the conversation is important. The conversation itself is going to hopefully prevent any likelihood of that happening because we're going to put things in place. So I would think that part of the reason that you see this really public side is Anthropic talking about this a lot and researchers talking about this with the hope that this triggers conversations that changes, that makes sure that people are building in a safe way. I think, I think some of the doomer people might actually be speaking more doomish on purpose just to get people to push in that safety direction more than if they had honestly said their practical, like, oh, you know, it's going

• 5:44Speaker 03

  to be a, you know, 100 years or something. But if you say 10 years, people are going to lock down on safety more. So that's my kind of take on it.

• 5:50Speaker 00

  I'm going to go last because I have spoken on this so many times. Ben, what does this mean for our portfolios?

• 5:56Speaker 02

  Well, first of all, one thing I think is pretty funny.

• 5:57Speaker 00

  Do you believe this stuff is so powerful that it's going to kill us all?

• 6:00Speaker 02

  I actually think it's pretty funny that there's 92 million views on this. Clearly, Elon is like, like pinning this to the top of X for all users in all countries. I mean, it's like, look, I think that every month I become more astounded by the speed that these models get better and what you can do with them in ways that I'm excited by as an investor. But like, if we keep ending up with these app lives getting tighter and tighter, you know, it's like, it is creepy to, to think about how powerful they're becoming. And it's obvious that we do not have, you know, sort of a government that knows how

• 6:45Speaker 02

  to deal with any of this stuff. You know, I think it's, it's, on the one hand, I think it's hysterical. On the other hand, I do worry about, you know, it making its way into national security and just like the state of the world a little bit. It freaks me out, to be honest. This one doesn't mean anything, although I do think you've had a lot of people complaining about OpenAI and leaving. I think there's been fewer people who have sort of raised the, the red flag on Anthropic and they've been done a great job like with the messaging around that. And, you know, Dario got very out in front of it very early. But like, we're dealing with some pretty unbelievable technology that's moving much faster than I think, like, the average person should be comfortable with.

• 7:29Speaker 01

  I personally look at this and it's, and you know, to me, it's a lot, it's clickbait. I mean, this stuff is, AI is incredible, like what it can do. When we first saw, you know, GPT-4, I saw it in August of 22, right? It was incredible. And just what it can do now, you know, versus then. And I think there's just a natural tendency in society to be afraid. And what we should be, I think, is more excited. And yes, having this conversation. But, you know, I did nuclear engineering in my old life. And, and, you know, if you, if you recall, when we were growing up, and Ben, I'll put you in the wee bucket, right? And Jason, you know, the Russians were going to end the world and we were all going to have, you know, it was nuclear was like the fear. And then if you read back and we were going to talk about AV, autonomous vehicles later, but it's really, I always love to

• 8:13Speaker 01

  read historical fiction and like, look back at what people were thinking, you know, at different points in time. And when, you know, cars first came out, much less, you know, ones that drive themselves, people really thought they were going to kill everyone. And so I think this, I mean, I'm super pragmatic, but I think it's a natural reaction to change that we have. And what we should be doing is having the, the positive conversation about, you know, how it can help us live longer and, and lead happier lives. And I think AI can, can do exactly that. And so it's, for me, it should be incredibly exciting.

• 8:45Speaker 00

  Yeah, this is like, it's super interesting to be here now because in 2012, 13, and 14, I had two neighbors who I was independently friends with, and we would go have dinner in Brentwood. One was a philosopher neuroscientist named Sam Harris, who hadn't started his blog yet, but asked me like, how do I start a blog? And I was like, well, you get a microphone and a guest. He said, what else? I said, that's basically it. And then Elon Musk, who lived in Bel Air, I lived in Brentwood. We'd go to Paponese, this great Italian restaurant. We'd sit there and I'd watch these two geniuses talk. And I'd ask some questions about it. And the one thing we talked about over and over and over again was AI. And this was,

• 9:28Speaker 00

  like I said, 22, 23, 2014. And the, what was the book that came out right along that time that got every, everybody's super hand wringing about the super intelligence, maybe?

• 9:42Speaker 00

  Nicholas, whatever.

• 9:43Speaker 05

  The Bostrom.

• 9:44Speaker 00

  Yeah, Nick Bostrom's book had kind of been making things. And then there was this crazy conference in Puerto Rico by the Future of Life Institute Conference. You can pull up the picture of everybody at this conference. But this is where it all coalesced, just for a brief history lesson here. And there's like a really famous photo of everybody there. Somebody needs to go back here and just draw the lines on it because this was the famous conference where Elon, and I have a point here, Elon, you know, after conversations with Sam Harris, decided he would put like 10 million towards this, funded OpenAI. Credit to the folks at this event. They saw that there was some downside here.

• 10:25Speaker 00

  And they started mobilizing and they did exactly what the industry needed. Hey, is there a nonprofit who could work on this and maybe keep an eye out for it? That nonprofit that was supposed to keep an eye on this issue was OpenAI. Obviously, famously, they went to become a for-profit company. And we know how that story went. But these folks are now the worst possible spokespeople for AI. 80% of Americans hate this. And if this keeps up, and I don't even think you can reverse it now. I don't think there's a way to reverse the negative sentiment in America. They're going to block every AI data center. They're going to burn every Waymo in the streets. And they're going to ban AI in schools like, you know, New York is, I wouldn't exactly call

• 11:10Speaker 00

  it a ban, but they're, you know, kind of banning it or limiting it. And I have some, I think there's some positive aspects to limiting it to make sure it's being used properly, not to cheat or whatever. Regular listeners already know that if you've got a great idea for a new business, our friends at Northwest Registered Agent want to help you bring it to life. They're going to be the most amazing partner you've ever had. Even if you're not ready to form an LLC, you still need to take care of some basics. So Northwest Registered Agent is now offering free identity services. That means a free domain name, open source website hosting, a business email, and a phone number, and everything else that's going to make your new startup look and feel like a professional

• 11:53Speaker 00

  company, all with no purchase required. And you know, you can rely on Northwest because they've been helping people like you start businesses for nearly 30 years. If you have an idea, you can't get out of your head, or even if you're already building something amazing, you already got started, Northwest Registered Agent is the best way to establish your new company. Learn more at northwestregisteredagent.com/twistdomain. Congratulations to the team at Anthropic and OpenAI. You have succeeded in scaring the bejesus out of Americans. They're going to burn Waymos in the street. They're going to burn data centers, and there's no way to stop it now. Congratulations. You're going to have a huge IPO because who in their right mind would not buy the company that's, you know, got a 90% chance

• 12:37Speaker 00

  of being the last company in the world. You're kind of obligated to buy it if it's, there's a chance that it's the truth. And a 10% chance of the world exploding, well, then money has no purpose. So congratulations on a PR strategy that is either brilliant or insane, and you're all suffering from psychosis. I literally cannot figure these people out.

• 13:01Speaker 05

  Well, this is an interesting one because is it a conspiracy theory? Because this guy says he's quidditch, so he wouldn't be doing this to boost Anthropic stock unless there's some kind of deal they worked out with him. So is that where we're going with this? Like, are we actually going through the looking glass?

• 13:15Speaker 00

  This is the most liquid stock in the world, Anthropic, right now. Like, it's more liquid than like buying Microsoft or Amazon on Robinhood. You can find it literally in the 100 milliseconds it takes to trade a stock on Robinhood. I think in 10 milliseconds, you can find a buyer for Anthropic. I'm being facetious, but Ben's shaking his head in agreement. It's like, super liquid. This person probably cleared their position ahead of the chaos.

• 13:39Speaker 03

  Jason, I think you made a good point bringing up the 2015 thing.

• 13:41Speaker 02

  Or not. Or, yeah, I mean, it doesn't-

• 13:44Speaker 00

  Or he left a double up. Like, maybe it's going to triple.

• 13:46Speaker 02

  It has no effect. It has no effect on, like, it's a runaway train. It's unstoppable. I mean, it really is. I think you're right also that negative sentiment is unstoppable. But that's, there's like a bunch of different downsides here. You know, when I talk about ruining the world, it's like, are we going to give, you know, our defense systems over to AI? That's where like, you actually have like real fear for the end of the world. My hope is that that is not-

• 14:14Speaker 01

  You understand that Trump has like a little red button that he can just push, right?

• 14:19Speaker 00

  I think there's some people around him who made a special pact that like-

• 14:23Speaker 05

  Oh, I hope not.

• 14:24Speaker 00

  No, they literally, in the first administration-

• 14:26Speaker 02

  In the first administration, yes.

• 14:27Speaker 00

  Yeah, they made, like, the adults in the room-

• 14:30Speaker 02

  Like, disconnect his button.

• 14:32Speaker 00

  They were like, literally, yeah, they literally pulled the red wire off the button. And they're like, yeah, let him click it three times and tell him it's got a 60-second delay, but it's definitely going to fire off the things.

• 14:43Speaker 05

  It turned on the Gorilla Channel on TV.

• 14:46Speaker 02

  The reason, look, the reason that people, I mean, I think like, you know, the masses don't like AI is because realistically, it is going to take a lot of their jobs. And we don't have, you know, by the way, I believe it's going to create tons of new jobs also. Like, you know, we invest in AI all day long. I'm not like a doomer here, but I, like, it's going to get worse before it gets better. There's going to be a ton of industries that get wiped out. You see this right now with kids graduating from college. There are no jobs. There's very few entry-level jobs. Like, you know, the wealth divide is going to grow. If you were like in the right companies and you have access to the private markets, then like, you're going to create some kind of wealth. And if not, like, you're going to have, you're going to be on the wrong side of that divide.

• 15:26Speaker 02

  Like, we're, and, you know, we don't have particularly stable leadership worldwide for a bunch of reasons. And like, it's a, it's a tough backdrop. And, you know, I don't think AI is going to destroy the world, but it's going to make a lot of people's lives much harder before, like, we get the full benefit of, like, you know, the large S that we're all promised.

• 15:48Speaker 00

  Yes, the abundance is not here yet. Yohi, what do you think here? You and Ben raced in with their-

• 15:57Speaker 03

  No, no, I was just going to say, like, you brought up the 2015 doomer thing. I was just going to say, like, it's important to understand the context that this doomer thing is not new, right? They've been around forever. They're just getting attention finally because AI is getting attention. And negativity just gets more attention, right? I was actually thinking, talking about AI with a whole bunch of people, and I asked a whole bunch of people with social media, net positive or net negative. And overwhelmingly, people immediately jump to the negative. People aren't connecting with each other. But then as soon as you start bringing up some of the positives, like, this show runs on social media. There's been people who didn't have a voice, who, and then once you start talking about those people are like, oh, yeah, there's been positive as well. And I think to some extent, the same thing's happening in AI, where, you know, we are talking about people not having jobs and whatnot. But at the same time, I've also talked to a lot of

• 16:40Speaker 03

  people who I would think wouldn't hate AI, that love Grokbot. They just can't stop talking about super rock. And there is AI impacting people in positive ways today as well.

• 16:48Speaker 01

  I can't agree more. I mean, AI is helping people grow their businesses, right? In incredible ways. Even like the offline businesses. And so, yes, there'll be change, right? But I think people fundamentally, like, this doomsday headline is what sells. It's what gets clicks, right? It's what gets everyone engaged. But when you look at even the advances in healthcare that people are experiencing, even on the micro level of being able to go and research your own conditions and really untangle what might be going on, you know, AI is not taking away the need for doctors. If anything, it's pushing more people in because they want to go and discuss these things with their doctors, for example, right? I see it as the net negative. And yes, some jobs are going to

• 17:32Speaker 01

  go away. But I think a lot of people are reporting, you know, busier than ever, largely due to how people, the consumer is leveraging AI.

• 17:41Speaker 00

  That's certainly been my discovery. I was very concerned about office workers. And in my organization, I scared the bejesus, everybody. I just said, if you don't use AI as your first attempt to solve problems, and when you have a question, if you don't ask two or three different AIs how to solve that problem, if you're not doing that, you can't work at the company. And I saw like us go from 20% of people logging into Claude to like 50%, then 60%, then 70%. And then we have like a monthly bonus system inside of our venture firm. And the same people kept winning each month. Like, in fact, they won 10 out of 12 and 11 out of 12 months. The top two people,

• 18:24Speaker 00

  they were all using AI. And their impact became three, five, 10 times that of the people not using AI. And I think what's started to happen here is people, if your organization can show people, my lord, your coworkers are now 10 times more effective than you are, then that should be the kick in the ass that people need to embrace these tools. You're not, the famous quote, you're not going to be replaced by AI, you're going to be replaced by somebody using AI, is exactly correct. Jensen nailed it. Because a customer support person, literally, a person who just picks up the phone and does customer support can use these tools to build a system to make themselves 10x.

• 19:09Speaker 00

  And they don't need any computer training. They just need to know how to talk to Grok, Bot, Claude, Cowork, pick your poison. You can just tell it, how do I get 10 times better at my job? And then here's my job. Here's my email box. Here's my Slack. It will do it. It will literally make you a plan. And I think that's what happened in corporate America. And when that happens, what I'm seeing is more opportunities emerge. If everybody's 10 times more effective, okay, what else can we do? Can we start another podcast? Can we, you know, run another incubator session? Can we find better companies? Can we help our companies find, you know, downstream funding and introduce them to VCs faster? Can we sort through

• 19:50Speaker 00

  applications for funding faster? Like, all of those things are occurring. So, I, I, the only area I'm actually really concerned about in the short to midterm is drivers, DoorDashers. Like, I think those people are gonna be the first wave where we see millions of people lose their job. If you're a founder who's not using AI to make yourself more efficient and productive, trust me, you've been left behind. But fear not, there is NetSuite Next. You already know NetSuite. They're bringing together your financials, your inventory, HR, CRM, and every other system of record that you need. They're already trusted by 44,000 companies. Now they have NetSuite Next. And that offers the same amazing platform, but with AI running alongside everything,

• 20:33Speaker 00

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• 21:05Speaker 01

  Well, I think drivers, like truck drivers, I think are the first ones, actually. But, but to your point about making people more efficient, this is exactly our thesis and to plug a company, sorry, Jason, but Savvy Wealth announced, okay, good. Savvy Wealth announced, you know, their $100 million round today. And what they're doing for advisors is exactly that. People thought, well, wealth managers are gonna go away. I've never believed that. I think people crave that personal one-on-one attention. But these wealth managers are made, you know, 10 times better. And the, the numbers they're giving us that we have, you know, have checked is they're getting 19 hours of time back in their week, every week, to do what they wanna do most, which is, you know, serve clients. And so by doing

• 21:47Speaker 01

  that, they're actually increasing their AUM three times faster, the assets under management that they have, because they're able to take those 19 hours that they're getting back by using AI in a really smart way, and put it back into their, their relationships, actually, with their clients. So that's exactly the thesis. I think this, that, like you said, Jason, it makes people 10 times better.

• 22:10Speaker 00

  And that means they could charge, they could take their one and a half that they're charging and bring it down to one or 50 bips. If they have three times as many customers, then they can compete in the marketplace and say, well, I have three times as much assets under management. I don't need to take 1.5 of your 4.5 returns. I'll make it 1%, which is what Wealthfront did. They use technology to undercut the advisors and bring it down. And they had great success with that. So, that ultimately benefits the consumer and those financial advisors. They both do their job better. Yes.

• 22:41Speaker 01

  And they have more, they have more time back. The same thing with lawyers. We did CaseTax, right? Same thing with lawyers. Everyone's worried lawyers are going to go away. But, you know, lawyers actually spend so much time on these mundane tasks when they really wanna spend time with a client with strategy. Very different, very different job for them.

• 22:58Speaker 03

  The, the makeup of jobs that people do has changed significantly over the years, right? If you look at today versus 10 or 20 years ago. And, and I think it's obvious that it's going to change over the next 10 or 20 years. The question is how? And I, I don't have an answer. I'm just throwing, throwing this.

• 23:13Speaker 01

  Well, drivers, I think are one, right? You know, Jason, I did Luminary years ago, and since it's been public and all of that. But I thought when I did Luminary, my son, who turned 16 this year, wouldn't be driving. And so it's actually been slower than what I thought it would be in terms of the uptake of autonomous driving. And I really, truly told my son when I made that investment that he'd never have to get a driver's license. And he has a driver's license, but also likes Waymo. But it's taken a bit longer, actually, than I thought it would take.

• 23:44Speaker 00

  Yeah. I mean, 10 years longer than I think everybody anticipated. People thought we would be there 10 years ago. Elon, Waymo, et cetera. Well, you know, there's, I, I think the reason for that is the expectation, Ben, like, people's expectation is if you're gonna have self-driving cars, you take out the steering wheel, nobody can die. That is the public's, it, it has to be, nobody goes to the hospital, no broken bones, no deaths. That's a crazy benchmark for a couple of thousand-pound vehicle going 65 miles an hour now that they're on the highways. That's the reason this is a slow rollout. They, they can only be perfect. That's

• 24:22Speaker 02

  By the way, we're, we're early in ZipLine. And I'm sure you saw last week, national news that an Amazon drone dropped a package in a swimming pool. And it's like, you know, there are tens of thousands of deliveries happening every day now, and one package is dropped in a pool. And it's like, oh, my God, drone, silly joke. And it's, you know, we're focused on, on the wrong things. Oh, yeah, but

• 24:47Speaker 01

  So Ben, I have to ask you, because I wanted to do this series, is it A or B in ZipLine? But did you invest when it was a toy company?

• 24:55Speaker 02

  We invested in the pre-seed, when it was, yes. It was, it was, it was, we invested in Keller as like person building robotics. And his first, the first product was a toy. Yep.

• 25:07Speaker 01

  That's so cool. Yeah, it was like a little robot or whatever. It wasn't even a drone. That's what I had seen it.

• 25:11Speaker 02

  The first product was called Romotive.

• 25:13Speaker 01

  Yeah, I'd seen it when they were doing the drops over, for medical and things like that. And love the, love the technology of not having to land. And so I'll, it's a funny story. So I, I was an investor who shall not be named. I was actually talking with the ZipLine crew about potentially letting them fly the drone on my ranch, because they needed like a big area of flight to fly. And I knew a very early, early investor. And so I was having breakfast with this not-to-be-named investor, and said, hey, I love this company, ZipLine. It was in his portfolio. And he's like, oh, you know, we invested in something totally different. It was a toy company. We'd never do the deal today. And it was

• 25:55Speaker 01

  fairly negative on it. And I walked away just deflated, right? Because I really loved the deal. Said investor then led the round that was announced two weeks later, entirely, right? So I, I learned a very hard lesson early in my venture career from that, from that experience. But really love, you know, ZipLine and all the, all the innovation they have, they've managed to do there.

• 26:17Speaker 00

  I too missed it. I met Keller when he was delivering blood on fixed wings. And I said, you know, hardware's really hard. I had him on this very podcast. I said, I would love to donate to this, but I don't think I can put my LP's money in it. Then like last year, he's like, you know, you missed the investment. I was like, yeah, I know. I feel like an idiot. I didn't know you were gonna deliver burritos. Just like, no, neither did I.

• 26:41Speaker 01

  They were like, they had like a UN contract or something to deliver like medical aid in Africa, right?

• 26:46Speaker 00

  Which is literally in my notes. I was like, slow sales cycle, like, the UN is not the best company.

• 26:52Speaker 01

  It's okay. I sat, I sat with Kalanick for three hours one day as he was discussing taking over the CEO spot at Uber. And I was like, and I, I didn't do that either. So that's like our

• 27:02Speaker 00

  Funny story. When he told me somebody else was gonna be CEO, I said, if you do that, I'm, I'm gonna not invest. You have to be the CEO. And he was like, do you think? And I had this like really long conversation with him. And to this day, Ryan, who was gonna be the CEO, is like, you dissed me so hard. And I was like, I didn't. You're Raz, he's Steve Jobs. Like, we're talking about Steve Jobs here, or like Elon Musk, or Bill Gates. Like, that was in all of our best interests. I shouldn't be on the management team. I shouldn't be the CEO. I would be amazing. So anyway, long story short, I have now a backstop. If I miss an investment, like ZipLine, I have the Syndicate.com. I've

• 27:45Speaker 00

  got 80 family offices in our tight little circle. And I say, hey, I found this incredible company, ZipLine. I missed the investment, and I would love to have you join me in putting in five, 10, $20 million. And I have a personal in with the CEO. We're friends. And he's been on the pod. And my CFO knows their CFO. And we, boom, just, yeah, this is when I had him. I literally talked to him at this launch festival about making up for my missed investment. But anyway, we don't have to play this. By the way, guys, if, if you didn't know, here's Steve Jobs. If he worked at Anthropic and launched the iPhone as an Anthropic employee, as you can see here.

• 28:31Speaker 00

  The iPhone increases anxiety, disrupts your sleep, kills democracy, creates misinformation, eating disorders for our children.

• 28:37Speaker 02

  It wasn't the iPhone, it was actually just social media that did all of those things.

• 28:40Speaker 00

  Yes.

• 28:41Speaker 02

  Anyway.

• 28:41Speaker 00

  Yeah, fair enough.

• 28:44Speaker 00

  The App Store did it. Yeah, I should make it the launch of the App Store. We're now going to partner with people who are going to destroy our lives. I mean, it's crazy.

• 28:53Speaker 05

  But he had to do it before someone else did, Jason. If we will imagine if somebody else that had the iPhone had fallen into their hands.

• 28:59Speaker 00

  Yes, it is.

• 29:00Speaker 01

  That's the argument for the nuclear bomb, isn't it?

• 29:04Speaker 00

  Here's a lesson for all my founders out there. Trust closes deals. You can have an amazing, beautiful product. It solves every problem your customers have, but if those same customers who love your product don't believe it's totally secure, they're out. And that's why you need a partner like Vanta. They're the number one security and trust platform in the world, and that's going to get you compliant fast for all the major frameworks from SOC two to HIPAA and beyond. Plus, Vanta is going to make sure you stay compliant by continuously monitoring your controls. And now you can interact with Vanta's agents wherever you're working, even if your team is knee deep in Claude or Cursor, it doesn't matter. Having

• 29:45Speaker 00

  Vanta as your partner means your deals keep moving and your engineers can focus on building that next great feature, not tedious documentation. That's why Vanta is already trusted by more than 16,000 companies, including Ramp, Ryder, Harvey, you've heard of them. So prove to your customers that you're ready for business. Learn more at vanta.com/twist and get $1,000 off. We literally had this discussion the other day. You know, the, um, yeah, there was an internal debate of if they should have done a demonstration, a public demonstration to the people of Japan. Um, you know, like, drop a bomb, you know, I don't know, 10 miles offshore, or hey, clear out this city. 20, 30. Whatever it is.

• 30:30Speaker 00

  Uh, clear out this island atoll, you know, and we're going to drop a bomb and you're going to have to really rethink your, you know, commitment to this World War II kind of thing. And they got over, uh, they got vetoed because, um, they felt it wouldn't work. And I think that's like maybe a major error in the history of, uh, computing, uh, the history of technology, like in technologists here. But anyway, let's keep going.

• 30:53Speaker 01

  But glad, glad Jobs did it first for the iPhone.

• 30:57Speaker 05

  Thank goodness, thank goodness he got there first. Before we go on, Jason, we should mention I, I'm wearing my Plod pin right here. You can see it on my jacket. We do pause for the cause. We do applaud Plod, our friends over there. If your work depends on conversations or interviews or meetings or calls, we're recording this show right now, by the way, on Plod. We will upload the Plod transcript and summary afterwards in the description, so you can read it yourself. Uh, a great way to keep up with everything that you're doing, everything that you're listening to, all your conversations. Just get yourself a Plod pin. This is the Plod note S.

• 31:31Speaker 00

  Hmm, I have it too. And here's the thing, um, it has a little red light. So if you're going to use it, you, you don't have to worry about privacy, whatever. You just ask people, hey, can I record this meeting and I'll send you the notes? It does great notes. I take it when I go on hikes. All right, let's keep going.

• 31:46Speaker 05

  So, uh, check out Plod at plaud.ai/twist. Use the code TWIST for 10% off.

• 31:52Speaker 00

  All right, there we go.

• 31:54Speaker 05

  Move on with the show.

• 31:55Speaker 00

  Okay, what's up next?

• 31:56Speaker 05

  Yesterday, Meta shipped an agent called Muse that, uh, they've been testing for, uh, teeing up since Zuckerberg's infamous 6,000-word manifesto last month. Muse is an AI agent tailored toward the everyday person. You message it just like you'd message another person in its own app or in WhatsApp, and it goes and does work for you, booking travel, filling out forms, turning a recipe into a grocery list. You, you get it, the usual stuff. Stripe has partnered up with Meta to develop the payment feature for the Muse agent, and it's free up to 100 million tokens a week with 20 and $100 tiers above that. No advertising in Muse at all so far. The whole thing rests on trust. This is, of course, the company that just agreed to an $18 billion settlement over social media

• 32:39Speaker 05

  harms less than two weeks ago. They're now asking people to hand an agent their inbox, their calendar, their credit card. So we'll go to you, Ben. Uh, is Meta going to be the company that finally gets everyday consumers to trust an AI agent with every aspect of their lives?

• 32:56Speaker 02

  It's a funny question. I, you know, on the one hand, Meta already has all of my data. Like, it couldn't have more. And so I guess, what's the harm of throwing it another, uh, another thing? Yeah, like I gave up years ago. Um, I think that Meta's got a big trust problem with, uh, I, I'm actually not sure how deep the trust problem goes, like, society-wide. I know within sort of like tech circles, there's like lots of snickering about like, you know, Meta being very behind in a, in a hundred ways. But obviously, there's 2 billion plus people using their products every day. Distribution is, that's a huge distribution advantage. I'm sure they're going to get a lot of people. I mean, by the way, you know, how many people are using Threads? Like, it's.

• 33:41Speaker 00

  Close to the amount of, uh, X, I think, right?

• 33:44Speaker 02

  Right. I mean, like, Meta can take anything and jam, and jam it down the throat of, like, hundreds of millions of people. Um, I haven't used Muse yet, and obviously, there's Instinct in town and a lot of companies like playing around this space right now, and that are, you know, there's going to be a lot of capital thrown at it. Um, but, you know, it's hard to, on the one hand, it's sort of hard to bet against Meta getting something real going. On the other hand, traditionally, they've had to buy all their big successes. And so, uh, you know, it's, it's, it's sort of hard for me to imagine them, like, winning this with a homegrown product because they, they haven't done that since, like, the, the blue app.

• 34:23Speaker 00

  Yeah, they, they're good at stealing, I'll go with Ben on this, they're, they're very good at stealing, um, people's innovations, like features, and putting them into their core product set. But Instagram, WhatsApp were purchases, obviously. Facebook was the original thought. This is, feels like they're just ripping off OpenClaw, Hermes, and most of all, Grok Bot, in making the most simple, easiest way for you to communicate with an agent, um, and then giving it to our cousins, our moms, our uncles, who maybe aren't super tech savvy. And in that regard, I think it's going to do very well if it's integrated into Instagram and they give prompts. So the reason Threads, in terms of the ram and

• 35:08Speaker 00

  jam down your throat concept, um, even if four out of five products don't work, if they ram Threads into the main feed over and over and over again, which is what they do, uh, and then when you're on Instagram, I, my total, the total amount of time I spend on Threads is when I'm on Instagram and I type a snarky, funny comment on somebody's Instagram post, there's a share on Threads, which is like completely stupid, but I do it just where there's something on my Threads, I guess.

• 35:37Speaker 02

  Were those Thread stats that you just put up?

• 35:39Speaker 05

  Yeah, we, the, this is thanks to our, our pals at harmonic.ai.

• 35:43Speaker 02

  $11 billion of revenue this year in Threads.

• 35:47Speaker 05

  Yeah, these are your Threads stats. 500 million monthly active users in Threads.

• 35:51Speaker 02

  Like, I don't know a single person who, since the week that Threads launched, has mentioned Threads.

• 35:58Speaker 01

  I've not, no, no one.

• 35:59Speaker 00

  No.

• 36:00Speaker 02

  Not in our circle, though. And they're doing like the same revenue as all, they're, Threads is doing more revenue than the entire consumer AI category, with the exception of OpenAI.

• 36:13Speaker 05

  I will, I will tell you, sometime on Instagram, they'll show you like some of your friends who are active on Threads. And I do, there are a few people, I think it's a lot of people who are still active on Facebook, they get sucked in a lot to Threads through some sort of integration. So.

• 36:27Speaker 00

  But Zuckerberg admitted, Yehi, on, um, when he announced Muse, he was on somebody's podcast, um, and, um, they were confronting him about like, oh, you're active on X. And he's like, all the AI people are on X, so I have to meet them where they are if I'm going to talk about AI stuff. So I post my AI stuff to X as well as to Threads. Um, so he kind of made that admission.

• 36:53Speaker 01

  But the funny, but the funny thing is, it doesn't really matter because all that revenue is coming from targeting, targeted advertising, right? And the AI people are not the ones buying all that shit. It's like, you know, 50-year-old housewives in the Midwest, right? And so he, I think the joke's kind of on, on Grok in a way, because it's like, you know, he's like, yeah, sure, I'll go talk AI there, but I'm going to sell all my shit over on Threads, right?

• 37:15Speaker 00

  The higher your IQ.

• 37:16Speaker 01

  And back up the revenue.

• 37:16Speaker 00

  Yeah, the higher your IQ and your income, the less likely you are to click on ads. That's the great conundrum, you know, for X. You have high IQ people who are like, that's an ad, I'm being manipulated, scroll, or I'm going to pay for the premium version so I don't see ads. It's always been their challenge since Evan launched the company. Uh, Yehi, what are, what are your thoughts here on, uh?

• 37:37Speaker 03

  Well, I think Meta did try to buy their way into this, right? That was probably what Manus was supposed to be until that.

• 37:43Speaker 01

  Oh, I forgot about that.

• 37:44Speaker 03

  And then I think I heard a rumor that they tried to make an offer on Instinct. I have no idea. I just saw, I just read it this morning. But, so I think that Meta was trying to buy their way into it, but, you know, none of those fell in. And then there was enough open source stuff out there that they could replicate it.

• 37:57Speaker 00

  Explain what happened with Manus, Yehi, because I, I haven't been keeping up on that, but that was the benchmark-backed frontier lab based in China that tried to move to Singapore.

• 38:07Speaker 03

  Yeah, it started in China. They had moved it already to Singapore, then grew, then Facebook tried to buy it. But because it was technically started in China, China was able to effectively, quote unquote, block it. But by that time, the transaction has gone through. So then they had to like, try to buy, find buyers for Meta's share somewhere else. And I think that's where I kind of lost the thread. I don't know if anybody.

• 38:30Speaker 00

  Yeah, China forced Meta to unwind the deal.

• 38:32Speaker 03

  Yeah. So they had to go look for someone else to buy that equity that Meta had bought.

• 38:36Speaker 05

  And, and they're, they were already like, they'd already started integrating the team. So Manus people were already working at Meta and they had to like, sorry, you have to leave now and go back to your old job.

• 38:45Speaker 00

  Give us the badge back. We're going to need that laptop.

• 38:47Speaker 05

  Yeah, really. It's like, that's very dramatic to lose your job that way.

• 38:51Speaker 00

  This is why, you know, I was talking to somebody who is in that region, um, And they were like, if you're a founder in China, you have to move your family immediately to Singapore. Like before you get traction, because they will just, you know, sanction you and you'll wind up in a reeducation program. Like Alibaba's CEO, Jack Ma, who's now painting.

• 39:17Speaker 03

  Muse is good, though. I tried it. I feel like, you know, every generation of these agents that comes out takes all the best, like all the learnings from the last generation and just embeds it. So, I mean, even just playing around with it, like, simple stuff like connecting to Gmail. On, on Bot, on Grok Bot and Muse, you can just click a link and it just opens up any auth into it. With ChatGPT and Claude, you still have to like, connect your M C P, your connector. The chat doesn't just give you a link to click an auth into. So there's small things like that that's got like.

• 39:45Speaker 01

  And where, and speaking of Gmail, like where the hell is Google in this whole thing? Right?

• 39:48Speaker 00

  That's the question.

• 39:50Speaker 01

  That's the question. Like, where, aren't they just gonna come in and just take the table at the end of the day, right? And just kind of watch all these things happen. I mean, talk about a company that's shitty at building product and having to buy every product they've ever launched, right? Except for maybe the very, very first one. But, um, but that's what they do. And so all these startups are popping up. They're proving the use case, right? That consumers want these things. Aren't they just gonna come take it at the end of the day?

• 40:16Speaker 00

  No, I mean, I think they're gonna buy it, buy it.

• 40:18Speaker 01

  Well, they'll buy it. They'll buy something, but they'll buy one thing, right?

• 40:22Speaker 00

  And, uh, I don't, I mean, given the market caps of the Mac seven and that Lena Khan is now, uh, working in New York to destroy my hometown. Like, I think there, we're now in a position where, like, well, no, she can apply her incredible, uh, lack of experience, uh, in economics outside of like, whatever Ivy League school she went to, but she turned off M and A for four years.

• 40:45Speaker 01

  Yeah.

• 40:46Speaker 00

  Biden hired her to turn off M and A for four years. Now Trump's in, you can think what you want about Trump. He's, he's all about our biggest companies, our national champions getting bigger. And that is extraordinary. Cursor got sold for 60 billion. Uh, Andrew Wang's company, the one, Scale AI got bought for 10, 11 billion. If this.

• 41:07Speaker 02

  15, 14, 15, whatever.

• 41:09Speaker 00

  14, 15. I mean, these are extraordinary. And if this company, what is it called? Instinct is the new.

• 41:15Speaker 01

  Instinct in town. Yeah.

• 41:18Speaker 02

  I mean, it's like Instinct's raising a two and a half right now, two and a half billion, and it's still like invite only pre-monetization.

• 41:25Speaker 01

  It's so like, that's just a crazy, that's just like a crazy acquisition strategy, like, must get, must get invited and then, oh, you're off the waitlist. I mean, it's just such a crazy acquis. It's just a consumer like mindfuck essentially.

• 41:39Speaker 00

  But here's the thing, if you think about it from first principles, um, these companies are worth 2 trillion, 3 trillion, 4 trillion. Okay, so 1% of, let's just pick a, a 3 trillion dollar company, 1% is 30 billion, correct?

• 41:56Speaker 01

  Yeah.

• 41:56Speaker 00

  So 1% is 30 billion. If you make 10 of these acquisitions and you spend 300 billion on those 10 acquisitions. Or if you do, let's say you do 30 for 10 billion each. If one works out, it's going to be worth more than 300 billion, which is exactly the math that Sergey and Larry did when they bought YouTube and Android. And when, uh, Zuck bought Instagram, WhatsApp. It's just an, it doesn't make sense to the business community, maybe watching it, or to people who watch CNBC or, you know, normies. Like, a normie can't understand this, but I think we all can. It's like, it's kind of worth it. If only one in 10 or one in 20 work out, like, here we are.

• 42:39Speaker 01

  Look at their R and D budget.

• 42:40Speaker 00

  Let me get Yogi in here.

• 42:41Speaker 03

  No, I was, I was asking myself, has there been, I always consider this a consumer-ish category startup that was king-made successfully? As in, like, a lot of money helped a consumer-facing startup really grow. I feel like King makes. Oh, okay, that's the, yeah.

• 42:57Speaker 00

  Uber, well, no, but the reason I know it so well is I was an investor in it, which I guess you guys didn't know, but, um.

• 43:02Speaker 02

  Wait, hang on.

• 43:03Speaker 00

  Yeah, it's breaking me.

• 43:04Speaker 01

  Sorry. I had no idea.

• 43:07Speaker 00

  It leaked, it leaked.

• 43:08Speaker 01

  No idea, Jason.

• 43:10Speaker 00

  Somebody just, I think, uh, Wall Street Journal just did an exposé. I was the third or fourth. They were the first to use capital as a weapon, but nobody else has really done it.

• 43:18Speaker 01

  Yeah.

• 43:18Speaker 00

  Maybe OpenAI and Anthropic are doing it now by buying 90% of compute. So we might have three examples that, off the top of my head, where they're using capital as a weapon. They tried to do it with WeWork, that didn't work.

• 43:34Speaker 02

  Well, there's lots of examples of, of king-making capital. So capital basically flexing that everybody else should stay out of our way. And we are the, you know, we're the champion of the category and.

• 43:49Speaker 00

  Examples, what comes to mind?

• 43:51Speaker 01

  But, but we're asking if it works.

• 43:52Speaker 02

  Harvey today is using capital.

• 43:55Speaker 01

  You know, Harv, I, I would argue, Harvey, Harvey is still, uh, I think the, the jury's still out on Harvey.

• 44:01Speaker 02

  By the way, I was in Times Square today. I drove through Times Square and the side of a building, 40 stories tall, was a Harvey ad. And the ad said, Harvey, 15.5 billion dollar valuation. And then listed Sequoia, blank, blank, and listed 20 VCs, and that was the ad.

• 44:23Speaker 01

  Do you, but doesn't that remind you of the dot com?

• 44:25Speaker 02

  What's going on here?

• 44:26Speaker 01

  No, no, isn't, isn't that reminiscent of like living in SF in the dot com? I mean, same type of thing, like, money doesn't mean that you've like want, it's, it'll, it'll be interesting to see, I think, at the end of the day, where, where it goes, right?

• 44:37Speaker 03

  B two B makes sense to me. Cause if you have money, then I can try, I can trust a company with more money because they have more backstop. Consumers, I don't think care. You have the, was it KiBi or Q U I B I? There's Clubhouse.

• 44:48Speaker 00

  Quibi.

• 44:49Speaker 01

  Remember, remember Ning back in the day that was quote, king-made social network, right? Way long ago.

• 44:55Speaker 00

  Here's the thing, if the product category, if, if you look at all three of those, Clubhouse was a bad product category. Uh, Ning, bad product category, like groups, who cares? Like, it's small. And, and Clubhouse, small groups, it was also kind of bad. If you look at Quibi, it's actually the right idea, maybe at the wrong time. These shorts in China. And, uh, there's a name for it, Lon, you would know. What's the name of these dramatic shorts as a category in Hollywood?

• 45:23Speaker 02

  Micro dramas.

• 45:24Speaker 00

  Micro dramas, thank you. Micro dramas are actually printing money. So I would say Jeff Katzenberg got it right, but was three years too early. I think you have to look at each of these on a case-by-case basis, because if you king-make a category and that category sucks, or you're too early, what does it matter, right?

• 45:41Speaker 05

  You, you actually nailed it on that. When Snapchat was like having its big moment, Hollywood got obsessed with this micro drama idea and a lot of companies spun up trying to do like, oh, we're gonna do like soap operas, but it'll play on Snapchat. And it was just too early, but now that's the time for, for it, so.

• 45:58Speaker 02

  But also the cost to produce. I mean, the difference with, with Quibi was Hollywood talent, Hollywood quality, a hundred thousand dollar for a three-minute video. And that, you know, these micro dramas are made for, you know, a thousand bucks for an hour or whatever it is. I mean, it's a totally different math equation.

• 46:15Speaker 00

  That is very true. All right, let's keep going. Yogi, did you have something you wanted to add there?

• 46:20Speaker 03

  No, no, no, I, I just think it's, it's a fascinating, I, I agree. I'm fascinated to see how these, how these consumer ones do.

• 46:25Speaker 00

  In terms of venture capital, this is.

• 46:27Speaker 02

  Think about more of these, these king-made consumer companies. Cause, I mean, it's happening all day long in, in B two B, but it is interesting.

• 46:34Speaker 01

  Oh, here's Magic, Magic Leap is another one.

• 46:37Speaker 02

  Magic Leap.

• 46:38Speaker 01

  Jobo, I just, Jobo, Webvan, I remember being so jealous of my friends who got friends and family in Webvan and.

• 46:46Speaker 00

  Cosmo and Urban Fetch in New York were the big ones.

• 46:48Speaker 01

  Dusaro, come on, like Dusaro, that was, I, that would blew my mind.

• 46:52Speaker 00

  I think, I think there's like spectacular failures, but there are, like, Webvan, Cosmo and Urban Fetch were examples of pouring too much capital onto management teams. And they just spent it too fast. If those three companies, and Urban Fetch and Cosmo, you probably remember Ben, because we lived through it, I think.

• 47:12Speaker 02

  Yep.

• 47:13Speaker 00

  Um, they were selling everything at half price in New York to get.

• 47:17Speaker 01

  Yeah.

• 47:18Speaker 00

  Market share. And so people in my, and they had no minimums.

• 47:22Speaker 01

  No.

• 47:22Speaker 00

  And they didn't charge.

• 47:23Speaker 01

  Order a single stick of gum, like one stick of gum.

• 47:26Speaker 05

  That was the key to Cosmo, yes.

• 47:28Speaker 00

  Have any delivery fees.

• 47:29Speaker 01

  Yeah.

• 47:29Speaker 00

  So they would spend $10 delivering you a pint of ice cream for $2.50 instead of $5. So they would lose $1,250. Then when they went out of business, people were like, and then right as Cosmo was going out of business, I remember talking to the investors, because I tried to buy the asset from JP Morgan,

• 47:46Speaker 01

  Yeah.

• 47:47Speaker 00

  who owned it and restarted. And they became profitable in the top three cities because they added a $10 delivery fee and they stopped discounting. So they literally had figured out DoorDash. But they ran, and when the dot com bust happened, they ran out of capital. I wonder if you're looking at something like Harvey today, spending on the side of a building, if they have the right business, the right team, but maybe they blow through the capital and they're like, wow, we spent $10 million on advertising that we could have just put into the product and sales team.

• 48:17Speaker 01

  This was CaseTex. I mean, CaseTex was, you know, launched in 20, launched, you know, with OpenAI and is powering co-counsel now for Thomson Reuters, right? And CaseTex was sitting at like 30, 35 million of ARR and hitting profitability, you know, three years ago, and not having to spend all that money getting clients. Like their CAC was, was very low. And so your point, Jason, do you think is just like managing your acquisition cost and are you really, you know, king making or not? And, and I'd argue you're not if you don't control your own destiny to some extent. And if you're just like torching.

• 48:51Speaker 00

  Managing large amounts of capital, Yohi, is something young people are not good at, inexperienced people. I watched this in New York when I was doing Silicon Valley Reporter, my first magazine, my second magazine, and double click Kevin Ryan and Kevin O'Connor raised a second secondary, like after they went public, they cashed up for like $2 billion, market crashed, but they were deploying it very slowly. And then I watched other folks who had raised an equally large amount of money and they were just plowing through it. And I saw this with Robinhood and Uber up close.

• 49:24Speaker 01

  Yeah.

• 49:24Speaker 00

  Robinhood was giving away a free stock if you, if you sign up your friend, you got a free stock, they got a free stock. Here's what they knew, because I remember asking Vlad about this, and this is like months before pre-launch, he had told me they were going to do a gift to get, like Uber and Dropbox had. I said, explain it to me. He goes, uh, well, we're going to give a free share, whatever. I was like, because it's $300 to $500 for E-Trade to get a new customer buying ads on CNBC, right? He's like, yeah, how did you know that? And I was like, oh, I worked at AOL. We, we were, I had sold the company to AOL and we watched that happen up close and personal where they were spending 100, 200, $300 to get somebody to put an AOL CD in their computer. And they just decided they would spend $15 on either side. So they're spending $30, they're spending 10%, but they

• 50:09Speaker 00

  figured out a device that was just super appealing to consumers. If you told the consumers they got $25 each at $50, they wouldn't have done it. But if you told them you get a free share of a company or a fraction of a company, they'll do it for $5 to $10 in the free share. It was crazy.

• 50:24Speaker 01

  It was, it's really smart hack. I mean, I've heard Harvey's on the order of $400,000 acquisition cost for every new account, right?

• 50:32Speaker 00

  And that's a law firm with an annual spend of what, I guess?

• 50:36Speaker 01

  But, but giving away a free year and it depends, like the law firms vary wildly in terms of profitability.

• 50:43Speaker 03

  Wait, just as I said on the Robinhood, that's also genius because of the retention thing too, right? Because if you get $25, you have no reason to come back to the app. But if you get a stock, you're going to come back to check.

• 50:50Speaker 01

  You're going to come back and check it.

• 50:51Speaker 03

  This one, that was pretty, pretty smart.

• 50:54Speaker 00

  Oh yeah. And I didn't consider that. You're right. It actually is a re-engagement.

• 50:57Speaker 03

  Your retention is going to be way higher for somebody who has one server.

• 51:00Speaker 01

  But Yoshi, to your point, you have to actually probably set up the account and give them all your information to actually get that one piece of stock, right? So that's gold.

• 51:09Speaker 05

  We got to talk about this NYU mathematician. He's accusing OpenAI of fighting dirty on the Navier-Stokes solution. Yesterday, we covered OpenAI on This Week in AI. We covered OpenAI claiming its internal model had cracked Navier-Stokes, one of the seven Millennium Prize problems. Today, though, we're getting a different side of the story. NYU mathematician Tristan Buckmaster put out a statement saying, OpenAI only started prompting its model on this problem after word of his own work reached the company and then a whole team and an insane amount of compute went into it. Buckmaster had spent most of the year on this with Levant Alpoje, a mathematician who works at Anthropic, and he ran the reports,

• 51:50Speaker 05

  drafts through OpenAI's codex the whole time. So when they asked whether the model had been trained on their sessions, they, they never got a clear answer from OpenAI. Buckmaster also argues that OpenAI twice pushed him to drop Alpoje from the paper because he works for their competitor. He then threatened to go public and was asked, why would you ruin your career? OpenAI's Sebastien Boubek calls all of this false and inflammatory and has since apologized for that line and said he retracted it on the call, though OpenAI's write-up does confirm its effort only began on September, September 1st, after they heard the rumor this is being worked on. So Rebecca, we'll go to you. Does a story like this change what you're willing to put into a frontier model? Are you surprised OpenAI may have stolen

• 52:35Speaker 05

  or borrowed some of these ideas from a researcher?

• 52:38Speaker 01

  Not, not surprised at all. Not surprised at all. But, but impressed with what, you know, the models are able to, to come up with here and how they're pushing, going far beyond, you know, reading your email and summarizing it to actually solving these mathematical equations, but not at all surprised. Um, I mean, and if you look back, I mean, if you look back at like very large companies and, you know, in terms of, you know, stealing data to get started, right, or to, to, to build, you know, you look at the Youtubes and the Dropbox's and the like, right? I mean, it's, it's, it's a common trend, I would say. So no, not at all surprised.

• 53:13Speaker 05

  Ben, do you think, I mean, if you were an academic or a researcher, are you going to keep using codex for this? Or are you going to be like, well, I don't want them to swoop in at the zero hour and publish right at the same time as me and take credit for my work?

• 53:28Speaker 02

  Well, we're actually in a stealth company that would solve this problem, uh, potentially. So maybe I'll come back on at some point and we can discuss this.

• 53:37Speaker 05

  Yeah, there you go.

• 53:38Speaker 02

  But, um, I, look, I, the, I, we, we use, we're a Claude shop here. We have a bunch of information living in Claude, you know, hopefully in secure ways. Um, I, you know, I'd like to think that what they claim about the data privacy and what they're training on and all that is true. You know, I, we're also in a world where like I, these companies are so big and so powerful, I don't even know how they get policed. I mean, like Facebook pays $18 billion. It's like, okay, here's like, as we just talked about, Jason.

• 54:13Speaker 00

  Feeding ticket.

• 54:13Speaker 02

  Facebook can go, it's feeding ticket. Facebook can go buy 10 companies for $30 billion apiece as a way to take a, you know, an attempt to see if they can get one out of 10 right and win a category. I, you know, these companies are at this point, like in some ways too big to police. And so, no, the reality is, I think you like, you know, trust these companies with your data at your own peril to some degree. And, you know, there's some kind of work where like you'd prefer your data not to go out and there's others where your entire life work is like working on a math problem that if somebody else solves it before you, you're like out of luck. Probably shouldn't, you know, that's, that's not the kind of work.

• 54:50Speaker 01

  Ben, I'm dying to, dying to hear about your stealth company.

• 54:54Speaker 00

  Yeah.

• 54:55Speaker 02

  Ping me later. It's, it's a good one.

• 54:56Speaker 00

  Next set. Save a slice for J Cal. Yohi, what do you think?

• 54:59Speaker 03

  I got you. I got you. I got you guys.

• 55:01Speaker 00

  What do you, what do you think of the sniping?

• 55:04Speaker 03

  I went, I went deep on this. It's a complicated issue. The stuff that we deal with, that's private information, right? And, you know, making sure private information doesn't get out. That's very different from the discovery piece. Like you said, finding a new solution, discovering a new drug. And for those, even if you strip out the PII out of it and you turn that into synthetic data, that might, that's, it makes sense that that might still be enough hint for the model to help discover what they were trying to discover. And so there's this issue of like in the scientific community, right? Or people are very conscious about what they share with who, because they want to control who builds on top of their work. And if you start doing that work in Chatschip and Claude, there is a possibility that it makes the next researcher find that direction faster. And I do think that is

• 55:47Speaker 03

  something that's going to be, that's going to be brought up a lot more in academia, especially as these things happen. There was actually another paper recently where, uh, where an, where a professor unknowingly had, had a pre-print available online and somebody else's AI found the pre-print and then built on that research. And then the student like proposed like a full solution to something the professor was working on. And he had never meant to share that six pages, but now agents are scraping the entire web, looking for partial solutions and can build on it. So the importance of like locking in your research becomes increasingly stronger. I think this opening, I think is really nuanced. There's a lot more, you know, I think it's pretty complicated. I think everyone, no one's trying to hurt anybody, but it's just kind of felt through in a bad way.

• 56:30Speaker 01

  Well, it actually helped you solve the problem, right?

• 56:32Speaker 03

  Yeah.

• 56:33Speaker 00

  Yeah, I'm going to take the other side here. Um, I've been saying for a long time that I don't trust the frontier model companies not to look at the results, not to look at the prompts. They have plenty of ways to get around this in the terms of service. Uh, and I would not trust them with anything that's important or proprietary. And this idea that you're going to give instinct or, um, you know, Zuckerberg, your Gmail, then your Notion, then your docs, then your databases means they're going to steal your IP, train it, and then give it to your competitors. Now, if it's for your, like ordering your groceries, who cares? It's probably for the benefit of everybody. But if you're trying

• 57:17Speaker 00

  to solve one of seven remaining mathematical problems in the world, I, I have to say, like, why on earth, if you look at the history of these companies, would you trust them? And I always, you try to explain this to founders. There's no, there's no free in the world. No free beer, no free pizza. There is no free vacation. You still have to sit through that seminar, webinar for your time share and get the high pressure sale for three hours. There's nothing free in the world. So when they offer you free credits for your startup, OpenAI offered like millions of dollars in free credits. Anthropic is giving people discounts, whatever. And then what does Anthropic do to Figma? They launch

• 57:57Speaker 00

  design, Claude design. What do they do to Cursor? They launch Claude code. They lied, from what I'm told, uh, and what's been discussed publicly about their intent with the Cursor competitor. Cursor was their biggest customer. And so, lovable, 11 Labs, Harvey, none of these companies should trust the frontier models. And it's nothing personal. It's that they're under so much pressure with 100 billion, 250 billion, $1 trillion build out of data centers, um, to make maximum money. And I don't think they can make max money from tokens. I think they have to win the application layer. So they're lying and they're going to go after the application level layer. And when they do, your startup

• 58:42Speaker 00

  and everything you've built will be sucked into their new product, period, full stop. It's a trap. It's a trap. Put in the, it's a trap.

• 58:55Speaker 00

  Admiral Adcock here from Star Wars.

• 58:58Speaker 02

  So are you guys running everything on open source models?

• 59:01Speaker 00

  That's what Harvey said they're doing now. Harvey released, I think, just two or three weeks ago that

• 59:07Speaker 00

  they had gone open source. There it is. It's a trap. They had released, they were now doing open source for their model.

• 59:15Speaker 01

  Yeah.

• 59:15Speaker 00

  Then they were doing contained models for their customers. So Ben, if you were concerned about like your Sherman Sterling, which I think is still the largest law firm in Wilson Sensini, Oric, you know, Latham, if you think you have some proprietary data and you don't want them to go from one law firm to the other because you use Harvey, Harvey's now addressed that and they're saying you can have your own verticalized harness, small language model, whatever it is, they're going to fork open source.

• 59:46Speaker 02

  Is it on prem? I mean, like.

• 59:49Speaker 00

  It should be. And I have like one of the big successes in this, this will probably wind up being the biggest success we've ever had out of our accelerator. We've had a billion dollar company before Grin and multiple 300, 500 million dollar companies. This one, go.ai, formerly known as Abacus, they do on prem. And they basically make this go one in a box and you order this for your company and now you're going and they build assistance for you, a studio. And you're now compliant if your healthcare, finance, any of the regulated industries that can't put their data into these services.

• 1:00:29Speaker 00

  Now you're boom, you're on prem with a server. So you don't have to wait to build a data center. You could just pop this into like some IT person's office and just start, you know, experimenting. And so everybody check out go.ai.

• 1:00:43Speaker 03

  I have, I have a plug, I have a plug here that's really relevant.

• 1:00:46Speaker 00

  Plugs are, just to be clear, VC saying what they invested in is not a plug.

• 1:00:50Speaker 03

  Okay.

• 1:00:51Speaker 00

  It is, it is a description of conviction. It is a description of conviction. We love that here.

• 1:00:56Speaker 03

  I have a company called Covenant Labs that's figured out how to encrypt open source LLM. So if you wanted to put it on a cloud, you can just take an open source model, they'll encrypt it, give you a secret key, you encrypt your input, you get out jumbled output back, you just decrypt it. So the GPU provider inference never sees unscrambled data.

• 1:01:14Speaker 00

  Okay, let me repeat that back to you. I think I understand it. I want to send a job to a cluster, but I don't want it intercepted because I'm renting the cluster. So I can send a job up encrypted. It gets processed of like, if I was building a frontier model or a vertical model, sends me my data back, sends me my model back, whatever it happens to be. And the service provider, if it was Crusoe Cloud, if it was AWS, never even knows what was processed.

• 1:01:41Speaker 03

  Yes, the, the input is jumbled, the output is jumbled, you encrypt it with your secret keys beforehand, you decrypt output with your secret keys.

• 1:01:48Speaker 00

  Love it.

• 1:01:48Speaker 03

  But it operates, the, the model works exactly the same way as if you've never, as it was.

• 1:01:53Speaker 00

  You, I mean, only the paranoid survive, right, Rebecca?

• 1:01:56Speaker 01

  Yeah, yeah.

• 1:01:57Speaker 00

  Survive, so.

• 1:01:58Speaker 01

  And we, and we have, we have a scale or we have a Skyflow and it's the data sort of, it's the data security layer for AI. And they have signed some massive deals lately where they're, they're basically sort of, I don't know, the containerizing is, is not the right word, but protecting the data that are going to the AI model. So these big enterprises like Walmart is, is a big customer of theirs. Can control and, and knows where their customer data is, is going into the model and when it's coming out. And so Skyflow has created, they were, they were in existence prior to, you know, all of the huge step forward in AI and they just were the right place, right time to sort of answer this question about protecting,

• 1:02:42Speaker 01

  protecting really sensitive data and allowing companies to use AI in that way. So, super interesting company.

• 1:02:50Speaker 00

  Yeah, love it.

• 1:02:51Speaker 01

  Yeah, really. Incredible founding team and the teams.

• 1:02:53Speaker 00

  That's the one thing that I think has changed, you know, we were talking about this being analogous to the dot com bubble recently. And I think if you look at this, the, the real difference is, these are real companies spending large amounts of money and getting very early wins from their spend. Is anybody here believe that the AI spend is not resulting in massively positive results for corporations and individuals? Like, does anybody, I think if anything, these AI tools are underpriced and the spend is.

• 1:03:28Speaker 01

  They're, they're running the math on the, and the acquisition costs and the upsell and sales and all of that and it's working, right?

• 1:03:34Speaker 02

  Well, I do think there is cases where you have people, where, you know, everything is so new and I know of examples where there's major law firms that are, you know, let's go back to the Harvey example, using Legora and Harvey trying both, figuring out what they want to be their sort of system of record and they're going to pick one and drop one.

• 1:03:51Speaker 01

  Or, or building their own. Oric, Oric built their own, right? Oric rolled their own. So, yeah.

• 1:03:56Speaker 02

  I just think that you're going to see, like, I don't think that all the revenue is going to be sticky, but I do think that the budgets are going to be only continuing to grow.

• 1:04:06Speaker 00

  Yes. The budgets are going to continue to grow. I mean, the fact that somebody would buy two, buy the top product and the second product shows that they're willing to be inefficient and not do it sequentially. Right? Because you could say like, okay, let's try Lotus 123 for six months, then we'll try, you know, Excel for six months and then we'll have a bake off. It's like, no, this is so powerful. Half of you get Excel, half of you get Lotus 123, the top 10% have both. It doesn't matter if we double spend. In our company, we have Claude running full steam ahead. We have Grok running full steam ahead, Perplexity, and

• 1:04:47Speaker 00

  we have local models running on Mac Studios. Like, we're doing it all and then just spreading it out across everything. And now I think I have to resubscribe to ChatGPT, which we kicked out early on because I was like, I don't know if I trust these guys totally with our data, et cetera. But now with their new model, I'm like, can we afford not to have access to this?

• 1:05:07Speaker 01

  But I'd be a little cautious. I mean, what we're seeing is that a lot of these enterprise companies that are, that are doing this, I mean, they have massive R and D budgets that we've talked about, right? And they're seeing the spend as, as a paid pilot essentially. And so they, they will make a choice. It's not going to continue for forever. But they're, they're seeing as, as a paid pilot and, you know, a lot of these, I, I talked to a medical practice the other day who was using a company, there's a lot of these right now that go out and do prior ops and, and, and all this kind of back office work and inpatient enrollment. And they'd signed up for a pretty major institution and I called the institution and I was like, hey, excited to hear what you, what you're, what you like about this company.

• 1:05:47Speaker 01

  And the answer was, you know what? It was, it was free. They just let us sign up for a year. So we didn't really do any work on it. And, and I'm afraid that's a lot of what we're seeing in some of these kind of quote fast growing, you know, B to B company or B to C companies is, no, B to B, sorry. Companies is that, you know, they're, they're kind of trying everything. And I think, and I think it will shake out. I think they will, they will pick a horse. And so I, I don't know that their R and D budget will necessarily shrink or their spend will shrink on AI. But I think they'll pick a horse.

• 1:06:19Speaker 00

  I think I'm spending like 5K a month in our firm across 20 people.

• 1:06:23Speaker 01

  Yeah.

• 1:06:23Speaker 00

  And I was.

• 1:06:23Speaker 02

  Totally reasonable.

• 1:06:25Speaker 00

  And I'm like, 60K, I'm like, and they're like, can we spend $400 on this a month? And I'm like, I think you could double the spend and we're going to get the value from it, like an extra 60, 70K a year.

• 1:06:38Speaker 01

  Yeah.

• 1:06:38Speaker 00

  Okay, that's like one, you know, entry level person, I think entry level person makes 60, 70, 80K. So do they beat the, does that spend beat the incremental entry level employee? And in the answer in every case, Yogi, is.

• 1:06:54Speaker 03

  We're never going to have an analyst, like at this.

• 1:06:57Speaker 02

  By the way, coming back to the first point of the day, there's a reason that a bunch of people are pretty freaked out about AI. No one's ever hiring an analyst again. But, uh, yeah.

• 1:07:06Speaker 00

  That is, that's interesting. You guys are seeing it that way. I'm hiring five researchers at a time, hoping one becomes an associate. We have an associate and training program. But now when we hire them, we came up with a trick. We give them a project to do on their own. We paid them $500 to build something with AI, like a dashboard, an agent to solve a problem, like write a deal memo, research companies, whatever it is. And they can't use something as amazing as Harmonic, right, Lon? Because that's paid. Harmonic AI, which is a partner for our program here, they have to use like whatever they have access to. So if they want to spend 20 bucks on lovable,

• 1:07:45Speaker 00

  you know, while they do this project, and we had 15 people who were like good candidates, half of them wouldn't do the project. I'm like, but we're paying you $500 for 10 hours to do this project. And I realized, oh, those half are not capable of using AI. They're intimidated for it. So the five we wind up hiring, none of them were intimidated by AI. And that's the key. Like this stuff, people are explicitly, there is a group of people, it's probably 50%, who are explicitly not using the tool. And that's like a major red flag. If you just are too scared to use it, like you're, you just don't exist in the world anymore. They'd be like not using the internet or not using Microsoft Office or whatever, Google Suite.

• 1:08:28Speaker 03

  I started doing intro to AI sessions, not for portfolio companies, but telling my CEOs they can invite all their employees to just demystify where to get started. The idea that like, if I can level up all the employees across all my portfolios, even a little bit, just making them more comfortable, I think that has a good impact.

• 1:08:45Speaker 01

  Yeah.

• 1:08:46Speaker 03

  Trying doing that. It's been pretty cool. I get a lot of good feedback on it. Employees who were hesitant to use AI felt much more comfortable starting to play with it.

• 1:08:54Speaker 00

  Well, and then what's brilliant about what you're doing is if you were. If you used AI in January, March, or June, and you have impressions of it, your impressions are completely wrong. Because so much changes every three months that like you would have missed like four or five new product features from Grokbot to, you know, the new OpenAI model, the 6X models, Claude Fable. You would have missed all those. Claude Tag, you just wouldn't understand the state of the art. So people think, I tried, you know, I tried AI, it didn't work. I'm like, okay, when did you try it? They're like, I think it was like May or June. And you're like, doesn't, what?

• 1:09:39Speaker 00

  That's like 1990, you used the internet in 1990 and it didn't work for you? Okay, it's changed a bit.

• 1:09:45Speaker 01

  So it makes it so hard to invest, right, Jason? Because it's, you know, people start developing these applications and you look at it and you're like, well, in six months, are the models just gonna?

• 1:09:54Speaker 00

  Or it makes it easier because the only thing you're investing in in year zero and year one is the team. The team, the team, and the team. Who are these two or three co-founders and can they deal with this pace? Will they pivot their way to success?

• 1:10:08Speaker 02

  More and more of these big exits are, I mean, like Cursor, pure pivot.

• 1:10:12Speaker 00

  Yes.

• 1:10:12Speaker 02

  Like, I mean, you know, like you're looking at like the big exits of today. Most of them started, I'm actually not sure. I was told that Instinct is a pivot as well. I don't know if that's true.

• 1:10:22Speaker 00

  That is the classic case for outlier success. Even SpaceX, they have a launch business. They add Cursor, okay, they've got a, you know, $3 billion in whatever Cursor's revenue is, or maybe it's $4 billion now. And then they're like, we have extra compute. Now we have Elon Web Services inside of it and it's $30 billion or something insane. It's like dwarfing the other categories. So so much opportunity space, it just requires a team that is just absolutely relentless. And we had a company, Micro One, they had, they were a $12 million company. We invested 500K, we did a little syndicate. We just fell in love with the founder, Ali, and it turns out like he made this incredible, he's a data lab now, hundreds of millions in revenue, $4 billion valuation.

• 1:11:08Speaker 00

  Again, we invested in one of his 12 million, so this will be a fund returner, like times five to 10 if, you know, things keep going the way it goes.

• 1:11:17Speaker 00

  He started with just trying to figure out, he made an AI test to figure out who were the best developers. So he built an AI tool just to figure out who's the 1% of AI developers. Then he saw Scale AI and all these other labs and it was like, wait a second, I could just find the top 1% of legal accountants, whatever, you know, we need training data for. Okay, let's just be a training data company. They just see it. So I always tell founders, like peripheral vision, super important. Like you will see something in your peripheral vision that is bigger than what your target was. And then you just turn and you change the target. You just move the crosshairs. It's not that big of a deal.

• 1:11:56Speaker 01

  But you have momentum, you have momentum and you can't start from zero. Lyft was that, Lyft was Zimride, right? And they saw what Uber was doing and they just turned a little bit, right?

• 1:12:05Speaker 00

  Yeah, I mean, they just, but they were up against a generational CEO.

• 1:12:11Speaker 01

  Yes.

• 1:12:12Speaker 00

  Goes back to my core premise, like just bet the jockey, man. It's just, it's the jockey.

• 1:12:17Speaker 01

  Always the jockey.

• 1:12:18Speaker 00

  Always the jockey. All right, listen, great episode, everybody. We could be here for another hour, so much to talk about. But let's end with, hey, what's your, what's the fund returner? Or the most fun investment, you can pick whatever you like, in, you know, this year, last year, whatever it is. Just a company you want to give a shout out to that's doing exceptionally well in your portfolio. High performers, let's make that the category. Yogi, you got a high performer you want to share with us?

• 1:12:44Speaker 03

  Yeah, I mean, we've all talked about sandboxes, but E2B was one of, we did one of the earliest rounds of E2B. That was right after Baby AGI. And I remember Baby AGI being in E2B's deck. So it's been really cool to see, see them just, the whole category just blow up and them staying at the lead on it.

• 1:13:01Speaker 00

  Ah, oh, so these are the machines

• 1:13:04Speaker 03

  Yep.

• 1:13:05Speaker 00

  that things like Muse and Cursor pop up and run virtually.

• 1:13:10Speaker 03

  Exactly. So Perplexity, I think, we're using that, Manus, GenSpark, those guys. So when they write, write code and run it, they want to run it in a safe sandbox computer. So it doesn't touch anything outside of it. So that's, that's what these guys offer.

• 1:13:22Speaker 01

  He talks about, you know, Savvy and Skyflow, but, you know, one of my most recent deals, I absolutely love this team. When you talk about founders, it's a team of three, like MIT, Eng. And they're doing, it's called Daptic. And they're doing compliance monitoring, which sounds super boring, but it's so cool. Google Data Center has just signed on, Honda's a huge customer, Komatsu, all these really, you know, sort of old line industry players. And what they help companies do is ensure they are regulatory compliant around the world. And what I loved about this company is when I, when I called some of their customers, they, they talked about the ROI behind the contract they just signed.

• 1:14:06Speaker 01

  And how they, one company in particular said, we just signed four times more, you know, more pieces of equipment in this country than we would have signed without Daptic. Because Daptic could show our customer that we were in, we checked every regulatory box they have. And what they're doing, yeah, super cool. What they're doing now is they're going upstream into new product development. And so if you want to design a drone, for example, and know that you can fly that drone in every geography out there that you want to be in, it'll tell you exactly.

• 1:14:34Speaker 00

  That'll save a lot of time.

• 1:14:36Speaker 01

  Yeah.

• 1:14:37Speaker 00

  Sounds incredibly boring and like a money printing machine.

• 1:14:40Speaker 01

  Exactly. That's what I love, incredibly boring and money printing machines, yes.

• 1:14:45Speaker 00

  Ben, tell us about Ogmodo, Ben, tell us.

• 1:14:48Speaker 02

  Yeah, well, you know what I like about this company? What, like, the reason I wanted to highlight it is it's, it's in a space that is sort of just a graveyard. Like going and selling into big retailers and supermarkets is, you know, one of the, it's like an absolute no-no for venture. It's like, we've tried this 50 times, like, we understand it's a trillion dollar category, but like, sales cycles are too long, like, no thanks.

• 1:15:12Speaker 00

  Margins are too thin.

• 1:15:14Speaker 02

  There's like a thousand reasons that like you're basically told absolutely under no circumstances should you engage in such things. And guys have just sort of like really bucked that trend and gotten like unbelievable uptake with retailers who, you know, shouldn't, shouldn't have trusted a company of this size in the early days. And, you know, what they, what they figured out is how to, you know, essentially solve the what's on the shelf inventory pricing problem in real time without the human labor going and doing checks and going and, you know, like the armies of people that are, that are running around, you know, counting inventory on shelves.

• 1:15:58Speaker 02

  And passively solving that with a piece of hardware that store workers are using as their sort of name tag. And over time, it'll become like the physical hub for how they use AI in their day job. But then also passively monitors everything happening in the store and ties back into the inventory system. And it's just like, it's a really, really, yeah, it's a really cool company.

• 1:16:24Speaker 01

  I actually looked at this early in the past, unfortunately. And because I had seen all the robots and things like that and prior things. But, I mean, this solves so many more kind of problems that, that retail stores are happy having, including the shrinkage issues and things like that, that they, that they see in their stores.

• 1:16:40Speaker 02

  And then Jason, this comes back to your idea about like founder. Ross had sold his last company to Niantic and was really like, you know, like very, very, very, you know, top 0.01% AR thinker. And applied, applied sort of like that giant weird brain to this category. And by the way, had no background selling into these kind of retailers, but just was a very special person. And, you know, we're getting rewarded for trusting our instinct on the person when we were really like, like all, every smart person in the world would say, just like, don't touch the category.

• 1:17:23Speaker 02

  And I like, I like when we're right, when, when like we're being brave, not just when we're right, when we do like the obvious thing and pay for it.

• 1:17:29Speaker 00

  It's the non-consensus bet. And this is so of the moment because AI, spatial computing, and you look at the badge, right? There's this whole movement to like Amazon tracks employees. We have companies that do this for fast food workers with the standard cameras out of there just to make sure, you know, things are operating optimally. And, you know, you, you run the risk of it being creepy. Here, what I like is it's not a creepy thing. It's just the person's walking through the store. And if it's got incorrect pricing, low stock, it just figures that out from the badge. And then you've now turned the average retail employee at a supermarket or wherever else they could put this into like a superhuman robot, right? Like they're, they couldn't possibly process this much data.

• 1:18:15Speaker 00

  So the store is going to be more efficient. And this goes back to like what I was saying earlier. You're not going to be replaced by AI, you're going to be replaced by somebody using AI. This is the perfect example of it. Like this person is 10 times more valuable now, which means they could have a higher salary, which means the store could be more profitable or more sustainable, or they could pass on savings. So this is like the promise of AI here. It's going to make the store more profitable, which means the store can raise wages, have less turnover. It's just absolutely awesome. And yeah, to your point about being a VC, like this, the startup graveyard, I feel like, is the perfect place to look for new versions of old ideas. There was an Uber and a Lyft.

• 1:18:58Speaker 02

  Yeah, totally.

• 1:18:59Speaker 00

  It was called Go Taxi or Taxi Magic that was on Palm Pilots and by text. So there's this company called Taxi Magic, you could call, but it was pre GPS, pre iPhone. They were like Taxi Magic was like, yeah, there it is. This is 2009.

• 1:19:16Speaker 01

  Cosmo and DoorDash, right?

• 1:19:18Speaker 00

  Cosmo and Urban Fetch, the two led to DoorDash, yeah. And so look in the startup graveyard, folks, like we get pitched all the time on like travel.

• 1:19:28Speaker 02

  Particularly now, particularly now, yes.

• 1:19:32Speaker 00

  Like the whole idea of like a travel planner was like group travel planner. Well, people go on a group trip like five times in their life. It's not like a common thing. But we had an AI travel planner, it was doing so good for us. It was called Rome, I think. And then the founders, and they were like during the ChatGPT 2.5, when it was only an API era. And they were like, yeah, ChatGPT 3.5 is coming out, you can just do this directly with ChatGPT. And I was like, no, no, no, you have a half million dollars in the bank. Keep iterating, ChatGPT is never going to build an interface, they're never going to have a logo, they're never going to have a concierge, they'll never have a $500 a month product. Like it'll do 80% of what you're ever going to do. And I was like, please don't quit. This is a different one.

• 1:20:11Speaker 01

  Oh, wow.

• 1:20:11Speaker 00

  This is Rome Around, but we had one called Rome. Unless that, yeah, no, I don't think that was it. But it's an obvious idea of like travel planning. And now I've got a bot named specifically for Tokyo and specifically for the Middle East, where I take, this is my new workflow. I just take a screenshot of whatever's interesting that I see. And then I send it to the Grokbot and I say, put this, and when I send you a screenshot, add it intelligently to my database itinerary for my next trip. So I sent it like the world's 50 best restaurants. I said, tell me which of the restaurants on the top 50 list are from Japan.

• 1:20:52Speaker 02

  In a city that I'm going, yeah, I mean.

• 1:20:54Speaker 00

  In Tokyo, and it was like, and it made the list. And then I'm like, okay, now go make me a Google map. And it's like, sure, I can do that. I can make a Google map for you. Like, okay, that just, why do I even need a travel planner? It's like incredible. All right, everybody, another amazing episode of This Week in Venture Capital. Thanks, Ben, Rebecca, Yogi. Great to see everybody. Excellent job. Thanks to our amazing news reader. News reader, Lon Harris, well done, sir. Well done. We'll see you all next time. Bye, bye.