SPEAKER_00: what this means is all the independents all the moderates let's call them clinton democrats you know business people who quickly bent the knee to kind of smooth things over with trump you know those people were kind of doing that in a very pragmatic way mark zuckerberg being probably the ultimate example of it right he bought a house in dc now he banned trump from reaching billions of

SPEAKER_01: people and then now he's all in on trump i think those folks if this becomes cataclysmic and it's

SPEAKER_00: affecting their business they could be pragmatic and say you know what maybe we should have more balance in the other you know arms of government and maybe tariffs shouldn't be done by emergency

SPEAKER_06: edict which i think is how they're being executed now and they should be done through the congress and of course there are people doing that so all this chaos for startups means fundraising is going to get harder selling into customers especially like fortune 500s is going to be harder there will be only one thing that's easier can you guess i was going to say hiring because there's going to be

SPEAKER_12: more people ah yes nailed it it's going to be easier to hire people so look for the purple hiring rings

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SPEAKER_01: all right everybody welcome back to american independence week here on this week in startups and globally it's uh friday april 4th and uh the stock market at the time of this recording is now down 20 percent since trump's inauguration i believe the nasdaq's down 20 some of the other indices are down probably low double digits so i don't know 12 15 20 i'm not sure if that's even from the peak of the trump bump but just from january 20th i was looking at it and uh this is a very unique moment in time i think you would agree alex because you and i study markets and um you don't have to make any of this political but i can't find people outside of the administration who thinks that this tariff thing was either well executed yeah or is a good idea and i've asked on twitter i said please is there somebody out there yeah i mean i understand the justifications people are doing inside the administration i saw the the different interviews my friends that uh all in did when they were there you know that's kind of the bubble right let's be honest let's call it what it is if

David Friedberg: you're a major donor if you're part of the administration if you're in there you know they're

SPEAKER_22: lockstep as they should be the biden administration was lockstep obama you don't you don't want to send from inside the house second guessing stuff that's that's just not how business works or or government

SPEAKER_06: specifically politics does not work that way these political parties really like to be lockstep but my

SPEAKER_22: lord i've never seen a situation where something so important dramatic consequential has been done with so many different versions of what's happening and interpretations of it i don't know what's your what's your read on this and any data points you want to bring to to bear uh let's start with a couple

SPEAKER_26: data points and then i'll dive into some other stuff uh cloud stocks uh that we track via the bessemer

SPEAKER_28: cloud index trades under wcld uh are off 30 percent from recent highs jason so that's you know 10 to correction 20 of bear market 30 i don't think we have an actual word for other than catastrophe um and for folks out there who are curious why do we care about kind of a sub index of the technology world well a lot of startups are effectively cloud companies and so this is an index they trade against it's kind of a comp for them so if it goes down harder to exit um each magnificent seven company fell under the three trillion dollar mark that was above it so that's kind of just um kind of makes you feel bad jason now on the point of who is defending this i read your tweet and i i read through

SPEAKER_29: a good number of the responses i did see one person who we like and it's anthony pompliano okay well i

SPEAKER_01: mean he's no finance expert but he is a crypto expert and i think he uh let me yeah just give us the bullet points of his justification for it or why he thinks it's brilliant he's been saying that

SPEAKER_29: it's already working i didn't actually i have not read enough of his stuff lately to dig deep into his

SPEAKER_28: viewpoint but he has been consistently beating the drum in favor of tariffs as an american policy point for weeks if not months now um he actually said in his response to you jason that i'm not very notable but i really do think that this is i'm tempted to have him on the show he offered to come on i'm tempted to just to bring him on next week just to speak for himself you'll be able to have him come on and see

SPEAKER_01: what he thinks of it especially given that it's caused so much chaos amongst the most elite finance people on the planet of which i'm in a number of group chats with and friendly with the consensus is if there is a strategy here it's been incredibly poorly communicated yep and executed yep and that if the strategy is this 4d chess that i think the administration has outlined and you can just take them at their word trump has been planning to do this since you know the 80s or 90s he's been very consistent about tariffs that this is a grand negotiation so chaos is the desired outcome that is

SPEAKER_22: where a number of people have landed he's trying to create market turmoil he's trying to get the fed to cut rates next and then he wants to get this 10 year down below a four handle four percent so they can refinance nine trillion dollars and then he will relent after they do that and then the stock market will come roaring back in time for the midterms but ben shapiro was on all in this week and he was like they're going to lose the midterms this is incredibly unpopular if you do something this uh seismic to the stock market all that people are going to remember is the result of it right and nobody and listen the reason biden lost i think most people or i should say kamala lost but the the the yeah the overriding criticism was inflation inflation inflation well get ready folks i do that inflation one point i was you know challenging i mean i don't know what happens to an iphone or a pair of sneakers

SPEAKER_41: if you have to make them here well the market has an opinion about that jason did you see what happened to nike's stock in the last couple of days tell me i mean i did see the restoration hardware and i

SPEAKER_01: shared a clip basically restoration hardware was on an earnings call and when they told him how down his stock was i think this must have occurred wednesday night if it was after the market all right

SPEAKER_44: aqua's down 25 take a listen in this race and i don't know like i don't have sports or stock now i mean i guess i guess yeah the stock was down you know based on some of the numbers he reported and then he got killed because of uh uh oh really okay so first of all what's rule one when you go on television

SPEAKER_48: jason i mean you're not supposed to say you know there's a selection of words there's a very small

SPEAKER_29: selection of words so i i bring that up not to be funny but because that goes to show how gary friedman clearly someone who does call into television quite often well actually i don't

SPEAKER_51: think that was a call and i think that was his earnings call oh that was actually on the earnings

SPEAKER_01: that was the earnings call oh that's worse this is the you know called cantonia shout out to my friend over at cnbc this is them replaying his literal earnings call and you know the background

SPEAKER_06: here is where does restoration hardware make furniture we really don't make furniture in

SPEAKER_57: the united states i hate to break it to folks but there are places vietnam india indonesia pakistan

SPEAKER_06: lots of places where furniture is made at scale at incredibly high rates with low labor costs and low inputs and lumber and you know fabrics that are cheap made in mills there for jobs let's face it

SPEAKER_22: with four percent unemployment here in the united states we probably don't have the scale and the number of people to work in that factory and make your sofa your couch your side tables you know it's

SPEAKER_37: going to the lowest cost place in the world as you know free markets uh tend to do so comparative

SPEAKER_28: advantage jason it turns out it's a great thing in international trade to allow us to be richer now i do want to make one more point about the who's in favor of this i was going back through youtube clips of milton friedman and he had a funny point he says you know if you get two economists together they'll always give you three opinions so don't ask them any questions but he said the only thing that economists can generally speaking agree on like the the point of consensus is that free trade is good and trade barriers are bad and tariffs being a form of import tax are a trade barrier so i just it's interesting to me to see the economic thought that i grew up reading as part of the intellectual chicago school of economics is now persona non grata on the american right it's you know long-standing intellectual home and that that is a shift that i'm still digesting to your point about no one knows what's going on but that that threw me for a loop things have changed so

SPEAKER_01: dramatically so quickly so i you know i don't even care about political parties i'll be totally honest and the fact that they keep flipping roles where you know the the democrats were against globalization they wanted to keep the jobs and the factories here the globalist republicans wanted to send them over there and now they flipped where the the republicans have picked up that mantle and want to bring back these jobs etc the truth is americans like cheap goods it has made the average american's

SPEAKER_22: life so much richer so you do not have to buy a usbc cable for forty dollars but to be able to buy one for four dollars and then you get to have like an extra cable in your car and an extra cable in your you know side table it's a stupid example but it is a relative you know an illustrative example of

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SPEAKER_24: because i'd like to share links from the podcast this week in startups right on linkedin in fact we live stream to linkedin three days a week and we get a great audience over there and i happened to be presented with this fund management platform and it was a direct hit like i mean talk about hitting the bullseye if you're in business and you're making a product or service it's really hard to find customers in the business to business space and doing b2b advertising is hard but linkedin makes it so easy because you know their tools let you target people by job title industry company size and more so this fund management platform obviously was looking for people in venture capital who had a fund size and a number of people maybe 10 people maybe 50 people and they found me they got me they split the arrow boom right on target and there's two things you really need to know about linkedin going into 2025. first they broke a billion members and 130 million of those billion are decision makers and 10 million of the billion are c-level executives like myself where can you get to those people it's really hard and the second thing you need to know linkedin makes an impact b2b markers report two to five times higher return on ad spend or roas return on the ad spend you should know that acronym compared to other social platforms 79 of b2b markers say linkedin is the best platform for paid media linkedin is going to let you build the right relationships it's going to drive results and you're going to reach your customers in a super respectful business environment it's not a place where people are dancing around saying inappropriate things or debating politics nope linkedin equals business business equals linkedin start converting your b2b audience into high quality leads today we'll even give you a hundy 100 credit on your next campaign go to linkedin.com slash this week in startups to claim your credit that's linkedin.com this week in startups terms and conditions do apply in this sort of abundance

SPEAKER_22: capacity are we going to take away that abundance and tell people you know what if you like having

SPEAKER_06: four pairs of sneakers you're going to go to one and you're going to buy it in america and it's going to cost three times as much so yeah you know nike stock getting killed lululemon getting killed

SPEAKER_01: all of these people build this stuff overseas and you know to bring this back to startups we have many startups who build hardware in china in shenzhen specifically we have ones who do it

SPEAKER_06: in vietnam who do it in india there's you know many places you can you can send your work this has basically created chaos in the supply chain and when there's not a predictable market everything freezes and so my word of encouragement for startups is just keep building just keep focused on your customers and try to block this out as best you can unless on a tactical basis you're literally making i don't know some hardware device and you have to then work your supply chain you got to

SPEAKER_37: figure out where to get pieces from you got to figure out if that piece is going to cost three times as much and if you're going to pass that on to the customer for those folks you're going to be

SPEAKER_22: in grinded out chaotic territory what you might want to do is lower your expense basis so that you can weather the storm this could be literally a three-day storm like on monday if the stock market goes down another 10 i think they're going to claim victory and find an off-ramp which they probably have already have planned going to be great vietnam and india and these countries have given us everything we want and now we're you know lower the tariffs on these people and now we're going to focus on the next group and these tariffs as you can see we're going to work through them uh we're going to do 10 a day for 10 days we'll be through the whole thing in two weeks like literally trump could say that right now stock market comes back 20 we literally would catch up they have that off-ramp anytime i predict they will take that off-ramp at let's say the nasdaq being down 35 something in crash territory right 10 drop correction 20 bear market yeah i think you start getting into like crashes at some point that's probably what's going to happen so if i had to

SPEAKER_28: take a guess i was thinking through the startup implications of this because this is not a macroeconomic show even though today i do wish that it was that we could just talk about this geek out a little

SPEAKER_85: bit macro it's okay i'll allow it it's kind of like a big topic so yeah sure absolutely but i was

SPEAKER_28: reading a lot of commentary from folks you know gavin baker jen ball from altimeter and i kind of packaged up what i think the consensus view is for startups so startups today are staring down probably longer sales cycles because cios and so forth are going to be a little bit more conservative probably some pricing pressure people want to make sure they're conserving cash a return of the venture liquidity crisis that means their investors are going to have probably less available capital because

SPEAKER_41: i don't think people are going to be racing to go public right now jason or racing to well well in

SPEAKER_06: fact i just saw come across um our chat and the newswire that clarna has paused its planned ipo so there you have it that then creates the liquidity crisis for venture nlps they feel poorer so that's a

SPEAKER_88: really important thing to point out your point about who made the point about cios um and not wanting to i want to make sure we give credit to that that they're going to be on pause yeah jamming ball from

SPEAKER_28: his blog clouded judgment he wrote quote every cio is now going to be more cautious budgets won't be as loose everyone will quote batten down the hatches to some extent that means tighter budgets and a

SPEAKER_33: real quote growth scare in the market got it so this is a legit thing for startups to understand and for people who just you know understanding markets business people are fine with competition they're

SPEAKER_22: fine with pricing pressure they're fine with uh talent wars they're great with technological innovation and disruption that is like the great parts of the game the worst part of the game is when somebody says i'm changing the rules of the game because you can't play the game if you don't know where

SPEAKER_06: the three-point line is like how do you take a three-point shot if you don't know is is there a three-point shot maybe there's not a three-point shot anywhere maybe it's a four-point shot you got to shoot it from half court people need to know the rules they adapt to the rules what we have right now is chaos and the chaos causes everybody to slow down what happens when there's a bunch of fog on

SPEAKER_01: the road if unless you're driving a car with lidar as we talked about two weeks ago you slow down right slow down sometimes you pull over i don't know if you've ever had that happen in fog but maybe

SPEAKER_00: once or twice in my life the fog was so dense i said not safe pulling over gonna wait gonna wait it out yeah if you happened in a snowstorm so this is kind of approaching that point jam and ball smart

SPEAKER_06: guy works for uh my bestie uh brad gerstner at altimeter i think that's what you know he's probably pointing to and he's correct now the cios say you know what um we're not going to implement and take on that project because we don't know if we have customers or if our revenue is going down or our supply chain so now everybody starts slowing down cascading you know what the next piece to that puzzle is

SPEAKER_22: cuts so i haven't heard anybody talk about this yet but i'm a business owner i'm an investor in businesses as i just said if you have a supply chain issue maybe you need to lay off 20 of your staff furlough which is like kind of like a pause sure uh and that's pulling off to the side of the road so you could see a restoration hardware lululemon and nike in the next two weeks if this doesn't get resolved and now it's a round of layoffs so literally nike might cut 20 of their employees so this is second order and then third order effects or consequences clarna is a second order consequence but clarna not going public the third order consequence is the lps don't get a distribution the lps decide i'm not going to invest in your next fund or i'm taking my 25 million

SPEAKER_06: commitment down to five or ten just to keep the relationship alive right which is what happens

SPEAKER_26: so here we are how many times in in your life isn't have you seen kind of back to back five percent declines in the nasdaq i can think of a couple times like 9 11 covid 9 11.com bust great financial

SPEAKER_00: crisis those would be the four that stick out yeah in 80 1987 when we had black friday right i kind of remember that a little bit because my dad had a bar and wall street guys found out there and they all lost their jobs shortly thereafter couldn't pay their tabs all that kind of stuff you know hot shots

SPEAKER_06: in armani suits all of a sudden couldn't pay their tabs to my dad and the third order effect is his business wound up his bar wound up shutting down because the whole economy crashed people couldn't

SPEAKER_37: afford to buy you know go out on a thursday friday and saturday night and spend 50 bucks or 100 bucks

SPEAKER_06: on dinner drinks or whatever so um you know we're in we're in a this could become cataclysmic this could you know result in uh one of these massive massive sell-offs and layoffs and then i guess you have to

SPEAKER_37: ask yourself for what reason and brad gerstner had an interesting um tweet vix spiking highest fear level since covid now things start to break the danger with shock therapy approaches in complex systems it's impossible to model the negative reflexivity time to make some deals and move on

SPEAKER_108: before we cause a recession and lose support for tax reform so you know and he's like fully 100 on

SPEAKER_01: board with trump and doge i'm not 100 on trump i am 100 on doge i am a hundred percent on like

SPEAKER_00: reciprocal thoughtful tariffs i don't know anybody who's not and so this is i think what you're

SPEAKER_06: starting to see and then uh of course gavin who is balls and strikes has always been he did a really long post and you know he started to he's getting a little more vocal here he basically is saying listen geopolitically nothing matters more than winning ai i think we all agree on that ai is going to define you know who wins china the us somebody else these tariffs as constructed

SPEAKER_37: essentially guarantee that america will lose ai by making america the most expensive place on earth to build ai data centers semiconductor exemption was irrelevant for ai data center semiconductors come into america and finish goods from taiwan and other asian countries servers storage systems and networking switches by the time we have developed the capacity to domestically produce these systems

SPEAKER_22: we have lost the ai race i'll just leave it there this is actually now we're in a second and third order effect if you can't bring these in here you can't build data centers third order impact no data centers no bueno for ai and then if other folks are forced now because they don't have the u.s market they find

SPEAKER_06: other customers so now you have the chinese silicon companies doing partnerships with vietnam india pakistan russia pick your country and maybe the eu wants an off-ramp for and they want an excuse to do a deep

SPEAKER_121: partnership canada wants to do a deep partnership with russia and china so this is the uh dare i say

SPEAKER_37: foolishness of how this was executed you could literally give a group of people who maybe had some pride in

SPEAKER_121: you know uh not wanting to partner with despots and dictators yeah and you know like look at germany they they had no problem partnering with uh putin for cheap oil india has no problem partnering with

SPEAKER_22: him with uh putin for cheap oil and they kind of like us look at china as a rival but maybe they're like well if we don't have america as a partner i guess we'll take the next best thing which is china

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SPEAKER_00: get your business investor ready today for just 39 plus state fees you can set up your company the right way fast private and compliant go to northwestregisteredagent.com twist today i have notes about europe at the

SPEAKER_28: very bottom of the show didn't think we get there but we have talked about project europe we had harry stebbins on the show we've discussed how there does seem to be a a movement inside of the continent to you know reduce regulation bolster bolster technology investment and um i think cherry ventures wants to build the first trillion dollar european company shout out to them for all that a couple interesting things to add on to what you said jason one macron is calling for a pause in european investment in the united states now that's mostly a symbolic statement from a national leader but i do think it goes to show the sentiment in europe about working with the us economically this could harm the ability of some american companies to sell into europe and there's also some brewing tension between european regulators and the trump administration zuckerberg is lobbying for some reprieve there you might say but i think that it's going to be tough to get concessions out of a block if you will that we are kicking in the shins repeatedly and this is going to harm immigration it's going to harm our ability to sell there's going to be technical technological restrictions it just feels jason like an unnecessary sharp move that could have been done smaller more

SPEAKER_26: tailored more carefully and would have had a a potentially positive impact versus trillions of

SPEAKER_00: dollars of wealth being deleted in two days i think uh what this means is all the independents all the moderates let's call them clinton democrats you know business people who you know either retroactively

SPEAKER_01: quickly bent the knee to kind of smooth things over with trump with their donations to the inauguration

SPEAKER_136: to crypto to whatever you know however they bent the knee and you know kind of made amends with him

SPEAKER_00: you know those people were kind of doing that in a very pragmatic way those were pragmatists i would say bezos from amazon is a pragmatist in that regard tim cook is a pragmatist i don't think that they're enthusiastic about working with trump they obviously weren't in the first term mark zuckerberg being probably the ultimate example of it right he bought a house in dc now he he banned trump from

SPEAKER_140: reaching billions of people and then now he's all in on trump and he went down there and sort of made

SPEAKER_01: amends with the ufc guy i think those folks if this becomes cataclysmic and it's affecting their

SPEAKER_00: business they could be pragmatic and say you know what maybe we should have more balance in the other you know um arms of government and maybe tariffs shouldn't be done by emergency edict which i think is

SPEAKER_06: how they're being executed now and they should be done through the congress and of course there are people doing that so all this chaos for startups means fundraising is going to get harder selling into customers especially like fortune 500s is going to be harder there will be only one thing

SPEAKER_84: that's easier can you guess the one thing that'll be easier i was gonna say hiring because there's

SPEAKER_22: going to be more people ah yes nailed it you nailed it it's going to be easier to hire people i mean if you get laid off from nike and you were making you know some six-figure salary and you were you know

SPEAKER_06: in marketing or you were in uh you know e-commerce and you worked in their e-commerce store

SPEAKER_22: and their app they might shed hundreds of people uh hundreds of people who worked on the lululemon website uh technology marketing and they might be like you know what i don't have a job i got some severance sure i'll take a flyer on a you know uh so look for the purple hiring rings on linkedin it's my best advice and then you can tell them listen i know you made a fortune over there you made a hundred thousand how about you make sixty thousand here and i give you a hundred thousand in equity so you're you know if it works out you get this huge bonus and you know whatever so this is

SPEAKER_53: going to be disastrous if it continues i know our show is not alex asks jason questions but we went

SPEAKER_28: through it well i mean i think people do want to hear from you so i just try to elicit things that i think people might want 2021 2022 grow at all costs raise hella money go fast go fast go fast 2022 23 slow down get close to profitability then ai acceleration spend grow etc if you're a startup today who has been tracking you know sentiment about how to handle your burn rate would you expect people or would you recommend that they try to pull back on burn or maybe new investment that could increase burn at least until we have some picture of what the new normal is or is that too conservative and

SPEAKER_149: people should just be going for it if you have under 18 months of runway you should always have a plan

SPEAKER_00: to get back to 18 months of runway so ah let's say you're at 10 months of runway you should have the ability and you're like oh my god i got so much interest we're going to easily raise around you should always have in your back pocket okay i'm burning a hundred thousand i have a million in the bank i can cut to 50 000 a month by doing these three things and get to 20 months in the bank this is in

SPEAKER_06: case of fire break glass plan b got it you should always have that and i have that i always have it i always keep you know i don't know a year or two of runway in the bank and i could always backstop our operations with my own personal money which i have some of so you know but if you're a founder who doesn't have the ability to say you know let me just grab a million dollars over here and and and float the company for you know 10 more months of burn or whatever it is you know in this example i'm

SPEAKER_22: using the the classic 100k a month and burn yeah i would say by next friday i would say a week from today you should make that decision if it's chaotic you should go to your board in you know one week from today and say i want to extend our runway from i'm going and here's how you execute it you say if we cannot get a deal closed to do a bridge to get to 20 months of runway i'm going to make these cuts so you talk to your board you say would you like to do an internal round i want to put another million dollars in the bank at the same terms as the last round or we tripled our revenue so i'll meet you halfway 2x the valuation not 3x i just need to put another million in the bank are you interested in that opportunity let me know by next friday right if you don't get back to me and you don't sign a term sheet because i'm the term sheet and the uh convertible note are in your signature

SPEAKER_00: package for review with your team if you don't sign it by next friday then i'm going to start making

SPEAKER_140: cuts and uh that's just you know my duty as the person 2025 is going to be the year that voice ai

SPEAKER_161: really breaks out voice ai is going to change everything and this technology is perfect for building a chatbot or automating customer calls and basically creating these next-gen voice experiences but building with these tools is so difficult it's just a bear it's going to take your developers months to build and test anything even basic unless you use vapi v-a-p-i this is the fastest and easiest way to integrate voice into your products it's just the most simple api you've ever used it helps you build test and deploy voice agents in just minutes and you can create ultra realistic ai voices and customizable personalities i like that part all with real-time response speeds you know what'd be great maybe i just demo it okay listen to this hey jason it's great to be on your podcast it

SPEAKER_165: seems like vapi has figured out how to be very low latency maybe you could talk a little bit about why

SPEAKER_167: that's important for sure low latency is crucial for a smooth user experience right it makes conversations feel more natural and engaging people expect real-time interactions especially with the voice assistants at vapi we've optimized everything to keep that response time around one second it's like having a chat with a friend not waiting for a robot to catch up can you do other voices and personalities right now i'm rocking my ceo's voice but with vapi developers can bring their own voice models so if they want to add some walking flair or any other personality they totally can i mean who wouldn't want a little drama in their ai conversations just think of me as your friendly ai buddy keeping

SPEAKER_171: it real if you want to give it a spin yourself and trust me you should just head over vapi.ai twist and twist listeners will get 1 000 free minutes per month for life that's f-r-e-e free what an amazing price again that's v-a-p-i dot a-i twist what i find is the founders are wishy-washy they don't make

SPEAKER_00: definitive crisp plans ah and then you have to go to your team and then you have to say to your team here's what's happening we have 10 months of runway globally this looks really shaky so here's what i'm doing there are 30 people in this company we're laying off six people they're getting this you know modest amount of sevens because you're a startup you don't give you don't have that much cash yeah so they're getting two weeks severance like one week for every year of duty you know whatever you know it's a hard reality but it's better than everybody getting no severance which i've seen happen as well really not good no so um you say everybody here's what's going to happen these four people for performance and because we're extending our runway but these are the four weakest people out of the 30. then uh i need six more people if you want to leave you can take this two

SPEAKER_06: week severance if not i'm going to just have to make those cuts let me know we're going to be 20 people we're going to be one-third less salaries and we're going to cut spending on marketing by 50 so it'll be 20 people doing this when i explain that to you if you were at tech crunch and the person came into let's say it's an independent company or you're at crunch space which was an independent company yeah how do i sound to you as a leader very very very having had touched grass

SPEAKER_26: like this is not a time we're going to coat things in candy things are bad we're going to move

SPEAKER_28: quickly there's not going to be a lot of discussion there's going to be some offers on the table i'm trying to be upfront and fair uh i would just pair it with and i'm reducing my personal salary by 50 for the next six months because i'm not here to profit while you suffer but i also think i like that

SPEAKER_185: actually yeah shared so shared suffering yeah great startups are inherently cash constrained like that

SPEAKER_28: is the game they run at a burn and so there's just not the same like google lays off a thousand people and gives them seven months severance and a pat on the head like you're not going to get that but you knew that going into the startup game so i think treat them like adults be upfront be clear about why

SPEAKER_134: you're doing this and then make sure you give glowing recommendations to everyone you lay off yeah i

SPEAKER_33: mean there's all these standard practices so my gut tells me there's a 50 that chance that happens

Chamath Palihapitiya: and a 50 chance trump sees another two days of this and he says unbelievable vietnam gave us

SPEAKER_190: everything we wanted great people in vietnam you may have heard of vietnam very simple it's the place he didn't like before but now he likes a lot incredible great leadership uh they make great

SPEAKER_28: great factories in vietnam yes anyway there we go i'm uh i'm just thinking a lot of the founders who are watching this i i guess stay tuned because we're going to be talking about every single

SPEAKER_00: thing that happens monday will be uh the telling day i think this weekend is going to be one of the most eventful weekends uh in our country's history yeah uh jason before we jump in and do our first

SPEAKER_28: office hours with the startup um i just want to bring up a little note to everybody amidst the chaos there is some positive news to bring up so rippling company we talked about a lot in the case of the deal spy mess uh bloomberg reports that they are in the process of working on around a couple hundred million probably at a valuation of 16 billion which is notably up from their 13.5 billion dollar valuation they got to last year and the information reports that they grew to about 570 million arr and they ended 23 with 350 million arr so 63 growth according to my math over a 15 month period lower than i expected from a company adding billions in valuation but clearly a company at scale

SPEAKER_26: and um you can still raise money in this market you just have to be a outstanding market leading

SPEAKER_37: company that just kneecapped a rival very publicly market leading is the key uh word in your recap there if you're the market leader if people perceive you as the number one you pay a premium for the number

SPEAKER_00: one 28 times arr is roughly two and a half times market rate right i think it's 10 times uh arr might

SPEAKER_140: be like what public sas people get on uh the best more index you were referring to previously uh so you

SPEAKER_00: get a premium for being high growth there if it's 63 growth on your back of the envelope math and again

SPEAKER_06: that's back of the envelope over five quarters um maybe it's 40 year over year if they're growing 40 year over year that's a high growth company in the public markets obviously absolutely um but for

SPEAKER_22: startups it's not you know triple or double so you know the reality is 20 times if it was public today

SPEAKER_202: it'd probably trade at 15 to 20 times there yeah i would have said 17 so right right in the middle of

SPEAKER_173: where you're you're guessing yeah so let's just give them the benefit of the doubt 18 and so they're

SPEAKER_00: trading at you know 50 more a 50 premium to what the public market valuation would be and the way

SPEAKER_06: that's justified by investors is again market leader parker conrad is a beast like just it is what it is like he's fierce bold great uh entrepreneur you can say what you want about the sec stuff but we talked about bending rules breaking sometimes you go off the rails i think he's probably learned a lot from that and you know it happens um so everybody moves on and uh you know the deal

SPEAKER_22: thing um is a cell phone by i what i think is one of their top rivals so yeah yeah no i mean it's a

SPEAKER_28: it's a great time to go back to your investors and say hey not only have we been growing while

SPEAKER_26: our competitor was cheating we exposed it and we've ruined their brand give us more money because

SPEAKER_81: that pitch would work on me in a heartbeat the crazy thing is you know like now we in all this chaos

SPEAKER_06: and and listen it's it's hard to even do a podcast about technology and startups without having the constant overhang of what this administration is doing because they're moving pretty fast isn't the

SPEAKER_40: tick-tock ban today tomorrow tomorrow that would be the number one story in the world we would have

SPEAKER_29: done three segments on it brought on an expert and it's a lot of yeah i literally had to go back and look up the date on that it's april 5th so tomorrow saturday is theoretically the deadline uh keep in mind

SPEAKER_28: that tick tock was banned for a hot second before trump said we're not going to enforce that law there's no liability put it back up eventually tick tock returned to the markets uh the number of suitors has

SPEAKER_29: expanded amazon threw its hat into the ring a couple days ago love that loving apparently is also okay

SPEAKER_26: i wonder if this is just a pr tactic i don't think anyone thinks they're going to be able to afford

SPEAKER_33: it uh but the main consortium is i mean they're worth 70 billion so they're worth the same price as tick tock what is the price going to be for tick tock i don't think they sell just the u.s version

SPEAKER_26: the current sticking point with answering that question jason is that we're not sure about this the fate of the algorithm so the latest reporting that i saw is that the trump

SPEAKER_28: administration and this is from i think it's abc uh is working on a deal that would allow china to maintain control of the algorithm that would be the least to the u.s entity however i went back to the actual text of the bill the law in question here and it says that uh a qualified divestiture which would allow to not be banned in the us uh does not allow for cooperation with respect to the

SPEAKER_26: operation of a content recommendation algorithm or an agreement with respect to data sharing so i don't think that's a legal thing so i think the algorithm has to go with it and then or some law changes or

SPEAKER_136: yeah they figure out some way to do it i don't think you need the algorithm i'll be totally honest looking at the x.com for you algorithm the instagram algorithm i i think there's probably no difference where it's you know plus or minus five or ten percent from the best of breed okay or your algorithm

SPEAKER_41: now stop stop stop stop jason we go we just got this just happened the team just sent this over to

SPEAKER_29: me oh no breaking news from nbc quote president trump is expected to extend the deadline for tick to

SPEAKER_226: find the how can he do that he can't do that there's a law um you know as we've talked about

SPEAKER_227: you can just do things and then it's up to courts to enforce that and so maybe he just does it and

SPEAKER_173: then it's up to somebody in our government in another branch of government to enforce it uh who knows uh so there's a breaking news story there's a breaking news story all right i mean i think part of this is back to the tariff issue because again there's no way to get around this it's just impacting everything the tick tock deal and the uh taiwan issues the ai issues the ip issues and the tariff

SPEAKER_00: issues are all one giant set of issues and so the grand reconciliation with china all of this could be

SPEAKER_06: energy and listen you can be democrat republican never trump or always trump or whatever put it all aside the the modus operandus of trump is to put a lot of energy into something create what one person might uh call chaos i might describe it as chaotic uh you might describe it as other people might call it brilliant in the art of the deal doesn't matter what we all frame it as this is what he does and maybe a lot of this tariff stuff has been designed to hit at the same time as the tick tock ban and some grand reconciliation what if next week okay xi jinping and trump or in the next what if they announce over

SPEAKER_22: the weekend xi jinping and trump are going to meet or jd and she's number two are going to meet sure and then trump's going to china she's coming to america or they're both going to saudi arabia or they're both going to moscow who knows and that the grand reconciliation is here there's going to be

SPEAKER_136: uh reciprocal clean tariffs there's going to be some you know agreement on one china taiwan and we go back to strategic ambiguity and tick tock has been divested and everybody's happy again stock

SPEAKER_00: market not only recovers these gains it goes 20 up from there and here we are he's a hero that might be

SPEAKER_29: no it sounds crazy no i look look i'm i all of my money well most of it's in the u.s economy like

SPEAKER_28: this this is very much impacting me i'm just i think there's there's a there's a a theme in people like you and i to look at things that appear to be sclerotic and crazy and we tried to put them in such an order that they make a lot of sense if you go back to the coverage of the april 2nd tariffs keep in mind that no one knew what they were going to be until the last possible second because they were still deciding it's just difficult for me to believe in four five six and seven d chess when the principal players don't really have a plan because i think if you're going to be that clever you have to

SPEAKER_41: be thinking not one step ahead but six so all right uh i think we have a guest we have a guest yes we do

SPEAKER_29: all right so today on office hours we are going to meet with luke from pod engine pod engine builds podcast research and media monitoring tools jason that all use ai you can find the company at pod

SPEAKER_65: engine.ai please welcome to the program everybody it's luke hey how's it going good good i like the

SPEAKER_246: flags oh thank you yeah that's texas and that's america uh and uh yeah i'll put the chinese one

SPEAKER_227: here after we do the after we do our big uh settlement with china uh so um we're investors in your

SPEAKER_173: company it's going well uh tell us a little bit uh educate the audience on what you're building and

SPEAKER_227: why and uh let's talk about uh any questions you might have this is office hours with jaco all right

SPEAKER_252: yes i'm uh luke i run a company called pod engine uh you guys invested in us about a year ago yeah and

SPEAKER_254: what we do is we're an intelligence platform that helps businesses grow through podcast sponsorships guesting and analytics but how's the business going uh i guess uh we were finally feels like we're coming out of the darkness a little bit and uh we have some signs of early product market fit which we're very very excited about uh last uh quarter for us was great we doubled uh doubled revenue uh hey yeah so and actually this quarter we're on track to triple it and we've actually almost quarter over

SPEAKER_88: quarter tripling yeah which means you're growing 20 month over a month on thousands to tens of

SPEAKER_254: thousands of dollars in revenue i would take it yeah yeah thousands but soon to be tens of thousands and so uh pretty excited because we're about to close a uh our first enterprise api which will be a five-figure deal amazing a year five figures a year yeah five figures a year yep yep uh probably

SPEAKER_06: like low to medium five figures okay so you mentioned three different ways in which your database and

SPEAKER_22: engine uh can help people so for stepping back one step i remember when we met you had this really great idea hey if you're an advertiser or a marketer you could figure out which podcasts have the topics you like because you have the transcripts you've essentially built the best database i think in the world of uh podcasts and how do you take all that intelligence and data and make it work for

SPEAKER_06: consumer you make it work as a business who needs it well if you're an advertiser in your oracle cloud and you want to figure out hey what are some good startups where what are some good podcasts where people are talking about startups they could find places yeah that was the first yeah yeah exactly

SPEAKER_252: and uh and sort of that gets to sort of both the the challenge and the question i have for it for

SPEAKER_254: you uh which is there's so many use cases for this and so for example i actually prepared for this interview using our own platform so what i did is uh we have a guest prep feature that's uh we've been working on for a little bit basically we looked at past transcripts analyze it with ai did some deep analysis and i got a nice three page pdf which is these are questions that usually come up these are questions that sometimes come up this is the type of stuff to prepare for so the verdict will be out in about 20 minutes if i do if i do a half decent job but if i do a decent job it's uh partly thanks to pod engine but that but that kind of gets the heart of the of our challenge which is you know we can we can do amazing reports for like you said businesses and brands about sort of podcast strategy what are competitors doing what are people saying what are people talking about we can do reporting analytics for for individuals we can do it on the b2c side there's all of these different use cases they're pulling us in a million different directions some of those use cases there's lots of long tail which be you know 100 bucks a month kind of thing some of the use cases right for example guest booking services and agencies we're talking thousand two thousand dollar a month kind of kind of size and so we were struggling with this a lot last quarter so what we decided to do is we took down all the pricing off the website and we really focused on just one icp because we got a small team and that was agencies who have a dedicated podcast function so basically they are either finding podcasts for their ceos or people to go guest on or finding podcasts to sponsor how many of those have you landed

SPEAKER_00: we're up to uh we're up to about about 15. 15 is amazing and how many um are there in the in the united states in the english-speaking world do you think if you had to do a bottom-up tam there's a certain

SPEAKER_173: number of people who work in pr and pr equals podcasts so maybe you just do the total number of public relations executives and you times it by 50 percent yeah so i mean that's where like it's

SPEAKER_271: interesting when we looked at purely just there's agencies that are just purely focused on podcasts

SPEAKER_254: yes i know they torture me yeah so there's at least a couple hundred of those of of decent size that are doing in the u.s and then when you kind of look at indiv companies who have individuals or pr agencies that are kind of doing this for them you get into the thousands god okay okay so that's amazing

SPEAKER_00: and they'll pay ten thousand dollars a year a thousand dollars a month to have five of their

SPEAKER_06: people inside it asking you questions and doing prep something in that ballpark yeah yeah exactly and

SPEAKER_254: it's not just finding and asking questions i mean i think that's where sort of you've got like the layer one kind of features which is you know your search right and your analytics so we pull in 12 different data sources we have a hundred different data points for we're kind of calculating we we transcribe all of our own podcasts we do about 25 000 transcripts every single day and that's so so it's a ton of data but i think what's really exciting and what really sets us apart from all of our competitors is starting to layer actual ai automation on top of that because at some level you know if for example if i want to go on a podcast and talk about my business i want to talk about you know podcast sponsorships guest booking the the search part is actually fairly straightforward and what happens is a lot of that gets outsourced to sort of low-cost workers or people doing it might use

SPEAKER_140: an athena assistant for this right yeah that's what i do i'll have an athena assistant look at a podcast figure out who the guests were put it into a database for me and boom we're done yeah or like

SPEAKER_254: for example my use case today of guest prep either i would have an assistant do it or i just wouldn't do it because i you know who has the time to listen to hours and hours of podcasts and prep so so by using sort of you know ai and agentic stuff we're able to sort of unlock new use cases lower the cost of entry and so that's really i think the the value the real value add in starting this business a

SPEAKER_173: year year ago versus starting it 10 years ago so i think you have figured uh you know a really

SPEAKER_136: important thing out which is you need to have at least one ideal customer profile you found it

SPEAKER_00: and you've converted it so though if you were to email 10 people who had a podcasting agency or a podcast agency group within their larger group how many of them would take a meeting and do a demo with you of 10 if you outreach to them you email them three or four times you email three or four people

SPEAKER_272: at the company of 10 of those companies you mentioned there are hundreds of them how many would take the

SPEAKER_254: meeting so far yeah and that's an awesome question i think that that gets the heart of why i think we have some product market fit now so we launched this so we launched our very very first embarrassing mvp beta in september last year about six months ago we sent out a lot of emails we didn't get a lot of meetings out of the meetings we got we converted in three months two customers which was horrible now uh so like last month i think we we probably had about 30 meetings and out of those 30

SPEAKER_22: we're we're almost 50 uh conversion what's the denominator of the 30 of attempted meetings to get to 30 whether a hundred outreach or a thousand outreach it's pretty low we're we're very targeted

SPEAKER_254: with outreach it's probably talking to the you know the low hundreds okay great we really really

SPEAKER_22: focus on this is what you this there's an art to pipeline management here and as the founder

SPEAKER_00: understanding your pipeline is critically important so let's say it was 300 and you got meetings with 30 that's 10 conversion now out of those 30 if you were to get 50 15 to convert to a paid trial oh my lord

SPEAKER_06: what an amazing thing you've discovered here which is there's something wrong in the top of the funnel

SPEAKER_00: getting 300 to 30 so we can work on strategies for that but there's something going tremendously right

SPEAKER_121: from 30 to 15 or 30 even to let's say six if you were to convert 20 of demos really robust right it's

SPEAKER_37: to get the credit card so you can look at each part of that funnel and ask yourself why these things

SPEAKER_00: occurred and then how to enhance them i could look at those 300 going to 30 meetings and i could tell you how to get those 272 triple the number of meeting what is your technique to get somebody who obviously could use the product to take a demo call what's the technique that works best so far

SPEAKER_254: classic founder-led sort of very targeted relationship-based cold outreach that doesn't scale but that does but does it really but does a really good job of unpack relationship-based one of the nice things for us right now is most of the agencies most of the customers are pretty small businesses you're talking you know five to thirty people so it's easy to find the person

SPEAKER_303: it's easy to find the person and easy to find them on instagram or twitter this is something i don't

SPEAKER_271: think people really talk about this that much but like founder to founder if you can kind of find

SPEAKER_254: another founder they have a lot of time for you because they know the struggles that it is to start and run a business and so when we get them on the phone a lot of times they'll take the meeting just because they're like we kind of lean on that you know got it i think an interesting thing to do here

SPEAKER_00: is the fact that it's got friction is totally fine um what happens as explained to me uh by the co-founder

SPEAKER_37: of benchmark who created wealthfront andy rackliff do you know who he is he teaches at stanford yeah so

SPEAKER_06: i'm gonna have my team send you the andy rackliff uh episodes here on this week in startups we have a public facing uh website created by podcast ai a sister company in our portfolio that is not trying to do what you're doing but they're they do websites right where we have our transcripts

SPEAKER_00: he explains like the phases of sales and the founder-led sales one you're doing consultative sales you're kind of understanding what their needs are you're explaining your capabilities and you're kind of meeting somewhere in the middle then you kind of get your first two or three sales

SPEAKER_37: people dialed in which you have no sales people now right there's no sales right now perfect you don't need one right now but when you get that first salesperson they'll do some of that consulting stuff

SPEAKER_00: but you'll have built a playbook here's the things people respond to here's the examples here's the collateral go do the playbook and then you know every two weeks you look at the playbook and you iterate on it and then you move to the third one which is your industry standard people call you up they ask for the price and they go that's too expensive you have a little dance around the pricing and then you're just taking orders how many seats do you need what's your budget do you want a two-year deal do you want a one-year deal do you want to pay quarterly do you want to pay a year up front and get a 20 discount you're you know it's we know you're on the lot we know you're buying a new toyota prius you had three toyota priuses before in your family we're we're just going to give you the fourth one right now so you're in that first part and there are techniques in that first

SPEAKER_06: part to ramping that up but if you're doubling quarter over quarter stay focused is the key and

SPEAKER_136: then maybe get that sales person on now and have them teach you the techniques how do you balance sort

SPEAKER_254: of so you know there's two kind of strategies right one is what's working is working pretty well let's just scale that out let's sell more five hundred thousand dollar two thousand dollar a month kind of things versus there is because we get a lot of inbound of people who just want you know give me the search give me the data give me an api for usage based pricing or 100 bucks a month or 150 bucks a month which we could do kind of self-serve on the website but what we found is that anchors are pricing to be much lower when we have the website i think you you could spend a year doing

SPEAKER_06: what you're doing and get to a million in revenue once you're at a million in revenue you have three four or five team members i think if i remember correctly you'll be wildly profitable and then

SPEAKER_319: everything's possible so profitable everything possible raising money hiring great talent so i would

SPEAKER_259: really think about that and alex pulled pulled up the website and this is sort of how we've kind of

SPEAKER_254: addressed that is as we kind of split it up into sort of use cases up from on an in from an inbound perspective because the the business is in every individual really is that sort of lower lower tier

SPEAKER_22: pricing yeah and there's like all kinds of a b testing you could do on this page putting a video

SPEAKER_06: on this page with you talking and walking people through a loom uh or asking them to sign up uh to look at the loom so you can schedule a call you could a b test looking at a loom so you could send you

SPEAKER_22: know um a hundred people to the page that has the loom video that walks them through it and then a hundred people to this page well you already have the data on this page and how it converts so this is

SPEAKER_00: where you know just slowing down to speed up sometimes works but you know as an investor in your company i would love to see you see if if you doubled quarter over quarter can we triple it's a small number maybe we can triple and i think if you're growing with this space and you're learning and then you can invest that money into the product everything will become possible i was going to ask you about is there a free version that people can do or a self-serve version i don't know that you need to have that what you could do do you have alerts set up and agents set up yet in this we have alerts i

SPEAKER_254: mean basically the this guest prep feature is it will be a great kind of free sort of tool right

Chamath Palihapitiya: to sort of get people i think another thing to consider would be an agent and an alert and an

SPEAKER_00: agent is the same thing so i would take alerts and rename them podcast agent and give it like a little

SPEAKER_06: spy or whatever and say competitive intelligence recommended podcast listens and recommended uh ones to guest star on or advertise on whatever it is you pick one of those three you set the agent in the agent sends you an alert if you set up that alert and as part of that funnel hey we set up an alert for you to look for you know let's say the person was in um e-commerce or fashion we set up an alert for you uh gwyneth paltrow at goop we set up one for you where they mention gwyneth paltrow they um talk about goop they talk about these four goop competitors uh or they mention um high-priced items that match the

SPEAKER_22: items in your store so we took your 100 items in the store we organized them and we created an alert for

SPEAKER_121: things similar or actually just discussions of things in your store because i think the things in our store are not necessarily made by her so we took your 10 of your items from your store and we made

SPEAKER_06: an alert for that an agent for that sorry stop saying alert say agent and uh if you'd like to turn this agent on uh let me know and here's what it would look like here's a screenshot screenshot

SPEAKER_121: worth 100 words short looping video loom worth a thousand words you know being able to turn on this agent and be agentic the podcast agent you know blah blah here's what it accomplishes and you set it up

SPEAKER_338: you can actually do that and make it auto magical auto magical is before they get sent to the high

SPEAKER_173: profile person who does podcasts for gwyneth paltrow because she has her own pocket she's always talking

SPEAKER_227: about podcasts you review it put a little polish on it yeah and then send it right a little reinforcement learning before it goes out so you you know oh maybe i order this and i put this candle a little

SPEAKER_136: higher and and i put this uh you know beauty cream a little lower whatever you think is

SPEAKER_06: the right thing to do and then that would might convert more people click here to see the results of it right so i mean if you send it to me and it's a vanity search hey every time somebody mentions this weekend startups all in or your top portfolio companies click here i'm gonna click it and then

SPEAKER_338: i'm gonna be like yeah turn it on for a couple weeks boom oh yeah let's you know let's set up a call and i'll walk you through how to set it up and we'll tweak it together so those are the funnel

SPEAKER_306: breakers that make things move through the funnel faster that you could probably do so you think

SPEAKER_254: sort of you know some level it's keep doing what we're doing and from a from a the customers until we sort of saturate that but then really start focusing on on top of funnel now now we feel

SPEAKER_136: pretty good about our conversion is that you feel great about your conversion from demo to paid yep then

SPEAKER_346: maybe it's the funnel from first contact to demo that needs some tweaking yeah for sure that's where

SPEAKER_227: what you do as a team member is you say to your co-founder or somebody works you you're gonna work

SPEAKER_00: on demos to sell i'm gonna work on getting those leads to you and you can look up the the science of this there's a whole science to it where you're tracking where the leads are coming from those are funnels and attribution and then you're studying you know where do we convert best and then you could understand the dollars some people find trade shows are incredible so when i invest in a founder and i'm

SPEAKER_136: like how do you get customers are like oh there's three legal trade shows in the united states there's

SPEAKER_06: this one in atlanta there's this one that travels so we do it in these three cities uh which are you know easy for us to get to and are the most popular and then there's this virtual one that occurs in europe and we attend those we can't afford to sponsor them but we attend them we get the attendee list and then we uh try to host like little off the grid dinners or coffees with people while we're there we don't go to any of the panels we just mean it's like literally somebody explained to me their strategy and it was brilliant because it was 25 000 to sponsor but it was 500 to go and you got the attendee list and they just tried to get coffee with people constantly and set up little you know offshoot events that they would try to get you know small numbers and then they would look at the total cost cost us ten thousand dollars to go we got a hundred leads it's a hundred dollars a lead and boom nice this is a wonderful place to be in because getting product

SPEAKER_37: market fit with any set of customers is hard and here you are you've raised money you built your product you got a great team and now you have product market fit at least with some group of customers the thousand people who pitch us maybe a hundred actually build their products out of the

SPEAKER_121: hundred people who actually build their products we invest in maybe one of them of the hundred that we invest in maybe fifty percent of them get some level of product market fit and paying customers so

SPEAKER_37: you know when you start looking at how far you've gone you're like one in like two thousand companies

SPEAKER_121: that get to product market fit and here you are hand-wringing about it that's why you're a good entrepreneur right only the paranoid survive the fact that you're wringing your hands am i doing the right

SPEAKER_347: thing here man i can tell you 99 of people never get off the bench you had the chutzpah i think i

SPEAKER_259: made great founder and a terrible ceo that's why because i think what you're a ceo you can't you can't

SPEAKER_06: be quite as pessimistic listen it's okay to be pessimistic take a victory lap every time you get a

SPEAKER_121: new customer take a victory lap ring the gong you know spend 15 minutes celebrating it and then back to the grindstone right and then you can be pessimistic again but do do celebrate the wins the fact that you're getting you know dozens of people to take these demos and you're converting like double digit percentage of them this is all great stuff brother you should really just celebrate this weekend if you got a a partner or a team member just go out and celebrate how much great stuff you did and make a good plan sunday night of how you're gonna really stay focused when staying focused is so

SPEAKER_37: hard for founders because there's so many distractions it really is you know in the startup game at the stage

SPEAKER_121: you're at is about relentless focus if you can be relentlessly focused on that funnel you're gonna crush it now you may not have the brain structure for it i've seen people who are idea people who get to the point you're at and they just start speaking at conferences they start a micro venture funds syndicate they do a non-profit they do everything but stay focused and double the revenue uh you know the next month just stay focused on that and then you'll be able to raise unlimited amounts of money and you know right now the bogeys really like a million dollars a year things really change when you're at a million dollars or i would say 500 000 and profitable break even so either a million losing

SPEAKER_37: a little bit or 500 and clearly profitable chef's kiss the world is your oyster there are a dozen seed

SPEAKER_338: funds who are going to take a meeting with you immediately and just want to know what did you figure out but what did luke figure out right the good thing is i used to play poker for a living

SPEAKER_254: professionally so hey so i i think probabilistically and i said to my my wife my co-founder last last at the end of this quarter that i think we're finally over 50 that we're going to get to half a million in profitable so that's it i think i mean you're right there and then we're off to the races yeah

SPEAKER_00: so don't start drinking at the poker table you see that happen somebody wins three hands and all of a

SPEAKER_01: sudden they're having a you know a vodka and red bull and you're like what are you doing it's all right continued success luke and uh let me know when you're in austin and we'll get some barbecue all right awesome thanks jason thanks alex all right more breaking news alex uh looks like we got a truth

SPEAKER_37: social post coming in from el presidente what does it say it says this is an update to the the breaking

SPEAKER_28: news from earlier in the show it says quote my administration has been working very hard on a deal to save tick tock all caps and we have made tremendous progress the deal requires more work to ensure all necessary approvals are signed so he's going to sign an eo to keep tick tock up and running for an additional 75 days and then it goes on to discuss tariffs and the upcoming deal again

SPEAKER_29: jason my question is very very simple by what legal right does he get to say that the law doesn't

SPEAKER_01: matter yeah i mean if we're going to have a constitutional crisis i don't think we're going

SPEAKER_136: to have it over this i think this would require somebody i think to take legal action against him or whatever so do is this the one we're gonna go to bat on you know to try to enforce you know some controls here i think the bigger issue is going to be the tariffs and we'll see the republicans are already starting to break ranks on the margins with these and saying maybe this should be something done

SPEAKER_00: by congress you know so i i think they're going to let this one slide because it's not this is not a make or break issue but uh we'll see and uh i think the thing that's going to be interesting i'm going to go ahead and predict that the sovereign wealth fund gets started with one third to half the shares in the tick tock entity and i'm going to say right now i think bezos is going to win it

SPEAKER_06: here's the thing trump collects billionaires trump collects people no different than i do i kind of

SPEAKER_155: like people he's a people person uh people say i'm very trump-like at times i like people he likes

SPEAKER_121: people he's got to spread the wealth he also has to punish uh zuckerberg so is the punishment to zuckerberg by making bezos who wouldn't give kamala the endorsement or wouldn't even let the washington post do an endorsement who bought you know bezos has had a place now in dc for a little bit bezos

SPEAKER_202: came to the inauguration his uh fiance was in the room huh remember oh i vividly remember that meme that

SPEAKER_121: was funny you were there it was pretty interesting i think other people's partners weren't in the room was a little weird um and so you know here we are um so congratulations i'm predicting it now bezos and amazon win and it's going to be great for amazon and for the market because really what is tick tock you know uh at its core uh i think it's like a front for people to buy stuff i think the shopping piece of it is so critical and then that solves so many problems with shopping and and you know what uh uh these tariffs and e-commerce do to the overall economy all right next on the program we're doing

SPEAKER_37: another office hours with jcal david from abacus is here uh they build ai tools for the financial services industry you can go find out more about the company at go abacus g-o-a-b-a-c-u-s.com

SPEAKER_227: welcome to the program david hello hello thanks for having me of course now i have a

SPEAKER_00: tool that we use the really simple sentence and the really simple sentence is a way for founders to explain what their company does i have one here i think we wrote it but uh why don't we have

SPEAKER_06: you do the really simple sentence exercise about your company so abacus is a generative ai for

SPEAKER_376: regulated industry think banks credit unions and insurance companies that's what we do so uh the

SPEAKER_109: simple sentence my team has abacus helps financial services companies access their own information and

SPEAKER_376: handle customer queries with ai tools yes yes i like i like that one too so let me talk about how we do that so regulated in jason think a bank a credit union or an insurance company they need three things though they want to use llms but they don't trust cloud solutions like open ai or cloud or anything like that right so they need three things the first is they need an on-prem model right so they have complete control over their data the second thing they need occurrence on the answers that they're given right make sure they're accurate and the third thing they need response control the ability to control the responses so abacus provides all three of those things we like to say abacus is where ai meets assurance and so we provide that platform of products to those industries so your customers are

SPEAKER_173: going to be for example a bank uh stock trading platform who would be like uh the ideal customer

SPEAKER_384: profile here for abacus yeah so think of a bank a credit union an insurance company all those types of uh institutions are examples of folks that would abacus got it so what's your question for me we're

SPEAKER_136: here in office hours a good chance for us to maybe work through an issue or two what are the issues you

SPEAKER_376: got so one of the things jason that uh we deal with a lot when we talk about the company and and the ecosystem is one of the questions we get a lot is competition right there's lots of folks in this area and personally i don't worry a ton about competition right i'm just keeping my head down moving forward it's on my radar but it's not keeping me up at night what are your thoughts on that because there's so many players in ai there's so many options what are your thoughts on the competitive

SPEAKER_173: landscape at the earliest stages of a startup uh you need to obsess over three things your team

SPEAKER_136: you have the best people on your team do you need to fire somebody do you need to add somebody

SPEAKER_00: do you need to do professional development do you need to have a sit down with somebody and say listen you're doing a good job i need you to do a great job are you committed to doing a great job because you're putting in 40 hours a week but we're not going to compete in this space i need you to put in 60 hours a week are you up for that so you know all those difficult team questions and and development of talent that's like job number one in year zero of a startup because that team then makes a product so job number two is really being able to have a product team that can quickly iterate on a product and product can solve all of your problems when you have a really great product that solves a problem you don't even need to market it you just send people a link and all of a sudden you're in business and of course the third thing to obsess over is customers nowhere in that framework that i talk about in founder university or the accelerator do competitors come up and there's a reason

SPEAKER_121: because you are not even at the point where you're in the nba playing against lebron james or steph carpe you're not on the court yet yeah let's get you on the court here getting on the court

SPEAKER_00: means you have a product in market you got five ten customers and that would be like somebody who's learning how to shoot a three-pointer and has a 20 shooting average and they need to get it up to

SPEAKER_121: 35 40 percent to be competitive and um you know they're worried about steph curry versus lebron james last night you're not you're not even you're not even on the court let's get focused on those three things so if i were to ask you to grade yourself on a scale of one to ten on each of those categories

SPEAKER_06: and you can't give yourself an eight go ahead and grade yourself objectively or how would somebody

SPEAKER_376: who's your co-founder or team member grade you yeah i think i think for team i'm going to give my team a 10. i think we have the best team and i i love them to death and we've worked together like

SPEAKER_399: crazy okay i love that you you previously worked together yeah we were previously working together we

SPEAKER_376: had a relationship at the the corporations we worked at and then we all left and and now we're

SPEAKER_102: working together on our startup i'm going to pause you there for a second when you said 10 i was like not credible but he's pumping up his team yeah i'll say right now actually your 10 rating is

SPEAKER_00: credible one of the things we have in our secret 13 reasons to invest in a founder or a startup is a serial team and a serial team is one that's worked together before at another company at another startup or you know they they were in the same fraternity sorority whatever poker group why they have that

SPEAKER_173: familiarity they have trust you know just like the knicks today have a bunch of villanova guys i guess

SPEAKER_227: with you know brunson and bridges and heart and they did have the vincenzo and that's why the team gelled so so well and anybody coming on the team has like a nice solid foundation so when you add

SPEAKER_00: somebody you have a culture great how about your product and product velocity where are you at there

SPEAKER_376: so for product i'm going to be a little bit more harsh because jason we are moving so fast i mean i have been in software for a long time but i've never seen things move this fast and now with vibe coding you know it's even faster so i'm going to give us a seven okay right because i think that

SPEAKER_408: we just have to move faster jason got it okay you do an okay job you do a fair job but you don't do a

SPEAKER_00: good or great job yet so there's work to do and you can give that to your team since you have trust

SPEAKER_126: in the team and say hey we need to get better at this and then in terms of customers your ability to delight customers to understand customers to spend time with them to obsess over them all of that customer centricness where do you put yourself on a scale of one to two that's going to

SPEAKER_376: be pretty high jason let me tell you why i'm going to give it a nine and you're probably going to be like yep yes and so this is why i meet with our customers every single week right okay not only do i meet with them but i constantly am asking them to tell us what needs to be there so that way we can

SPEAKER_388: get to the next level in in terms of what's going to make their life easier one of the things i tell

SPEAKER_376: all of our clients in our contracts is i don't want you to use abacus if you don't absolutely love it i'm not here to take your money i'm here to give you a product that you love that delivers value to you and i really mean that because it's an extension of the product is an extension of my reputation

SPEAKER_388: it's extension of abacus and i want people to really love using the product does that make sense

SPEAKER_413: i think you've objectively you may have elevated your scores a little bit i might take

SPEAKER_136: one point off of each but you're a positive enthusiastic so i can't take that away from you um but i think you've identified what you need to focus on and now if we were to add competitors

SPEAKER_00: there you know in a vibrant market where people can vibe code and previously what did we call it the when you can roll your own websites you drag and drop stuff there was another term oh yeah the no code right yeah so there was like a no code revolution and you know a lot of people could start making things vibe coding is very similar people could start making things i paid for i forgot what the

SPEAKER_88: services that let you build stuff and i said oh i want to make the service annotated.com because i own the domain name annotated.com i started it and i just forgot that i had started vibe coding so like it's one thing to be like you know and i could put out my little annotated.com service and you know

SPEAKER_00: have a 1.0 and then distract you somebody who's got like some perfect annotation software out there on the web right and you're like oh my god jake i was doing something there come back when you're here next year this is what i with podcasting you know like yeah i always tell people okay uh you know come

SPEAKER_126: back and talk to me when you hit episode 100. right that's when you get good at it i'm you know as

SPEAKER_37: episode 2000 something here of uh this week in startups and i had done a podcast before that and a radio show before that and then all in just hit episode 222 so yeah you know like call me when you get

SPEAKER_00: to 100 200 episodes under your belt and we can have a really thoughtful discussion about how you're

SPEAKER_37: doing as a podcaster i think you're doing everything right i'll be honest uh you have revenue these

SPEAKER_405: customers are starting to pay yes we have a 125 000 in monthly recurring revenue yep i mean i love you nine enterprise clients oh i love you look me in the eyes i love you you broke a million in arr now you

SPEAKER_126: have my interest my interest uh when are you going to be in austin for barbecue oh many things have you

SPEAKER_434: want have you written a two-year plan you know jason i have to tell you i was a big plan person two

SPEAKER_376: year five year but then this is this thing happened to me and maybe it's maybe it's user error every time i'd write a plan everything changed so fast and in ways i couldn't expect at the end of the two years it was nothing like i had thought so i had to really rethink my whole two year five year writing

SPEAKER_388: out this is what i want because what i oftentimes found everything changed by the time i got there

SPEAKER_136: okay this is such a great observation in a dynamic industry with a dynamic team of course things are going to change you haven't started doing board meetings yet right not yet but we're we're almost there okay so you're at a really interesting um crossroads you're going to have to make a decision

SPEAKER_173: about if we do have product market fit at abacus which it feels like we do you know is it light product market fit is it strong product market fit is it you know reasonable product market fit it's

SPEAKER_00: clearly reasonable product market fit because a million dollars is a lot of money to it you can't fake it so there's some reasonable perhaps even strong product market fit so the next phase for you

SPEAKER_227: i think is to start quarterly board meetings one hour create a plan with your team a very lightweight plan number of customers amount of revenue and you really want to set a goal of tripling revenue year over year yeah and the reason i think you were probably correct about planning last year and might be wrong about it this year right the same issue you could be right for the looking backwards and wrong

SPEAKER_00: going forward you're now flying a plane at a higher altitude burning more fuel at a higher speed right when pilots start they put them in the cessna 172 or something it's a very predictable plane if

SPEAKER_173: you put it in the sky and the pilot dies it just flies until it runs out of fuel it flies itself it's

SPEAKER_00: like a workhorse it's just hard to mess up then the people get into like a cirrus with a joystick and it's faster and it's a turbo prop and then they wind up in one of these light jets and like a phenom 100

SPEAKER_227: and now they're going 400 500 knots it's like each time you move up the risks the the inputs and what's at state kind of goes up you have to pay attention to more things and then my friend's guy

SPEAKER_00: dayton who started you know in this 172 and then i started flying in a cirrus 22 or something with him

SPEAKER_121: it's the parachute plane now he flies a falcon you know he's like a pilot and he could fly a falcon which is like a substantial jet and uh this is a we've known we've been friends for 25 years and

SPEAKER_00: this is like i don't know maybe he's 20 years into being a pilot i think wow the point being you're now upgrading from the sirius 22 and now you're starting to get into a jet you're not in a fighter jet you're not in the falcon but you know this this is going faster there's more at stake etc right

SPEAKER_173: what does that mean you got to get through the checklist you got to make sure the fuel's in there you got to be thoughtful about the weather conditions the height traffic control you know just the runway because you're going faster speeds and that means that planning is going to be helpful

SPEAKER_00: why did in order to triple revenue you can't be winging it you've got to be saying okay we're going to triple revenue by tripling the number of customers or we're going to double the number of customers and then with this subset of customers we're going to double their spend so we're going to add a million that gets us to two and then some number of those customers in the two million are going to double

SPEAKER_121: their spend to get us to three that means you need to have somebody who's on the land and expand team who's expanding and doing customer success and then you need somebody else who's putting top of the funnel in and then you need somebody else who's closing those and onboarding them and make sure you

SPEAKER_00: have customer success so you don't turn and now you got to be really thoughtful because when you do this two-year plan you're going to say okay we want to go from one to three to nine well what do we need in

SPEAKER_121: terms of sales reps if we know a sales rep can convert this many people okay we're going to need this many sales people oh every three sales people we fire one we keep one and one quits that's the nature of sales people by the way you know there are sales people who are bad and they just bounce from custom from you know startup to startup because they suck and but you know everybody always gives a sales person a chance and so maybe they're just good at getting the job but they're shitty at doing the job and then one's incredible and you can't keep them because they get a new offer or they decide one day that they don't want to be sales they want to be the president or chief operating officer which does happen as well especially with the talented ones and then you find one who just

SPEAKER_37: just right goldilocks right too cold too hot just right which means if you need three great sales

SPEAKER_121: people you might need to hire seven eight nine to get to the goldilocks zone these are conversations

SPEAKER_00: i have you know now that i'm kind of in my oh i'm not yoda phase yet but i'm kind of obi-wan phase i

SPEAKER_06: fought in the clone wars and i've seen people tell me i hired three sales people they're going to do three million dollars each we're going to hit nine and i'm like uh how many sales people quit

SPEAKER_121: right well we've hired 10 people i'm like how many sales people have now three i'm like okay so you retain 30 of your sales people you're telling me if we hire three more we're going to hit the number they're like oh yeah i probably should have to hire six i'm like or ten right ten to get to here and then how many can you reasonably onboard at a time and you have a strategy for onboarding once i realize this when we hire researchers for our venture firm i like to hire them in threes knowing that one's going to excel and make it to analyst one we're going to fire and one it's not going to be the right job for them and they're going to quit so i just tell the team if we need

SPEAKER_06: three more of these uh you know essentially analysts who become associates just hire three researchers uh every three months and in nine months three of them will excel if we get to you

SPEAKER_121: know the second chord of three and it turns out we did great and we're keeping two out of three okay

SPEAKER_06: well then we have abundance and awesome but i'm planning on reality so that's where you're at we

SPEAKER_227: started this discussion with competition yes you know like worrying about competitors is generally for suckers and you can see what happens if you get too obsessed with it with the deal versus um rippling brouhaha did you watch that no but i've heard that's the one where they put the spy in and

SPEAKER_136: oh yes yes yes yeah the whole spying thing like that's where people get too obsessed right that

SPEAKER_00: they literally start doing illegal stuff here's like generally speaking if you want to lower your

SPEAKER_227: anxiety about competitors very simple thing to do watch their webpage watch their social there are ai tools you can do take your top five competitors and just have it send you alerts when any webpage on

SPEAKER_466: their website changes that's if you were to watch our fund when you see founder university website

SPEAKER_227: change it means a change in strategies occurred and the leader has said change the website so you'll be up to date on it you get the founders the top sales person on social media and you have all of their

SPEAKER_121: linkedin twitter instagram posts uh saved you can use like a zapier to do that and have it send it to a slack room so you know i've i've had situations where i needed to monitor somebody like a stalker or like a vibrant individual and literally i just told somebody on my security team just take their social media put it into a slack room keep an eye on them boom high class problem that's smart like this

SPEAKER_06: yeah um so these are just ways for you as the founder if you do have anxiety about competitors to just monitor them this is not corporate espionage it's uh intelligence right competitive intelligence is the category you can roll your own nobody on the team needs to even know you did this you just go

SPEAKER_121: you find a web page tracker you set up a zapier it might not work for twitter anymore but you can write a script to do it i think uh or you could just have somebody on your team who you want to do competitive intelligence you say visit these places every day for 15 minutes and just write us a

SPEAKER_124: little report what's this company up to that's terrific advice that's absolutely terrific i haven't

SPEAKER_475: heard that before so i'm that's i mean that's a really easy way to scale i fought in the clone wars i could tell this is terrific a lot of scars i never lost the limb

SPEAKER_478: lost one to doku and then the other three to me so take it these are all star wars analogies that

SPEAKER_12: my co-host alex doesn't get but that's just a way for you to do it now there are some dark arts in

SPEAKER_480: between when you're ready to talk about dark arts i can do that conversation but that's one we won't

SPEAKER_121: have on air okay there are some dark arts there are some things that could lead you to the dark side right i'll tell you about those privately uh david continued success um did you go through our

SPEAKER_485: accelerator or do we directly invest so la 33 and then i also i went through founder university as

SPEAKER_376: well which i will say both are fantastic programs when i started before i started found university i didn't know anything about venture capital i didn't know anything about the ecosystem you know and it was just such a great program to go through because it really prepared me and then the accelerator is like the advanced version of that what'd you learn or accomplish in the accelerator versus founder

SPEAKER_227: university compare and contrast that you know compare founder university experience to accelerator

SPEAKER_376: experience just tell us like the yelp review of each so founder university you know i spent a lot of time watching videos with you in them right you explaining what's a startup what's great about fun university is you don't assume we know anything you talk about how to come up with a name how to come up with a website talk about the basics and so i didn't feel there was ever a point where i didn't know something or you know and i had that continuous support from you know we meet every week you know and so i got the continuous support from the team and it just i mean i could tell with my friends so i have friends who are also trying to start companies and they didn't go through founder university and i could tell that i was accelerating faster than they were because i started to learn more and that's because i had this shortcut right which was access to videos created by you explaining all this stuff right so that's found a university right so then the accelerator happened and that's where you're really taking all the stuff you learned and found a university and you're applying it okay you learned about venture capital you learned about a pitch deck you learned about how to present certain information a certain way now you're gonna have to go out and do it and not just one i'm not sure everyone realizes about the accelerator you're doing this every week so you're pitching to vcs and the accelerator brings all of these vcs in their network to the accelerator that you know we probably wouldn't have access to otherwise yes every week you're pitching to them so by the end of the accelerator you are so good at pitching it's unbelievable and so it's just really a fantastic program to go through you're trying to get your startup off the ground or you're trying to learn about startups i i even thought jason i wish there was a program i talked to other vcs and they say we couldn't do what jason does and i say well and i said have you ever looked at his program and they said no you know we've never we've never seen it and i often thought it'd be great if you had something for fellow vcs to

SPEAKER_384: teach them how you how you construct this right because i think i'll be honest the the the challenge for

SPEAKER_00: what i do is that there's only so much of me to go around right when you decide you want to scale this stuff paul graham had the same issue my friend david cohen who runs techstars the same issue once you hit more than 10 investments a year you know you just can't be reasonably available to 100 200 300 you know or in the case of y comedy or they were at 450 a year i think techstars at its peak was doing the same or more across many programs and so it breaks most investors brains and to run a jedi academy they could be a jedi and have you know a squad of jedi you know six seven eight which is how venture works you're a gp you have you know 10 boards max you're on and you just work with 10 founders what i've tried to do is scale it through media so that's why office hours exist you and i talk you give me your biggest problems on the air you get a little promotion for this people learn about

SPEAKER_06: the company uh and then we can take this video clip it and put it into the founder university archive and say here's jason talking right about competitive intelligence so right oh he's doing this and that's why my friend lon harris is back in the fold here he's going to take this work with kelly and lucas at founder university and make this a module so the thing is you got to hear me in

SPEAKER_121: a structured way talk about branding and how to pick a name you might have been you know focus they may have told you to go watch raul's product market engine video and maybe two or three other versions of product market fit yep um because you know there's different philosophies of this and you know that scales but it becomes very annoying for gps and funds who have to maintain relationships at scale because you know you i am an extreme extrovert is my superpower i took the myers-briggs which is um

SPEAKER_393: astrology for men uh you ever take the myers-briggs yes i have entp or entj what are you i think i'm entj

SPEAKER_06: yes okay that's like steve jobs and you know most founders fit in entj i was entj and then entp

SPEAKER_00: i'm i'm super excited about your success thank you so much for the kind words about the programs and i would love to host you and the management team here in austin i'm going to start doing tuesdays i think are going to be the day ask people to come in monday we do a working session on tuesday you can you know bounce on wednesday or do whatever the heck you want here but uh you know get a couple of hours with the team team and i'm going to try to put together four companies every

SPEAKER_06: tuesday to come and have barbecue and then brine together where you each present under chatham house rules where you know you don't share stuff so everybody's in the portfolio and then you'll be with people who have 500 to 2 million in revenue so you're when we have this discussion about

SPEAKER_00: competitors and two-year plans everybody's kind of sinking on that and we let me kind of open-ended

SPEAKER_227: and just actually also for fun because i get great joy in seeing people succeed great to spend some time with you david and everybody go to is it go abacus it's go abacus yep well i can tell that

SPEAKER_85: you're in the jcow branding school because i always like one word and then i always tell people after

SPEAKER_00: you get your one word if you can't get the domain name go abacus get abacus abacus fake it till we

SPEAKER_499: can get abacus.com and if we never get abacus.com it's not the end of the world because people will

SPEAKER_227: find things on google search great job brother can't wait to spend some more time together thank you jason very much thank you cheers anything else we need to get to on the docket or should just wrap

SPEAKER_29: i want to just say two quick updates uh on news items that we've been discussing we talked earlier about can trump actually delay the tick tock deal well charles cook uh reporter over at i think uh

SPEAKER_28: national review says no flagrant violation of law so there's one data point and then finally um from i think it's a bloomberg update a bite dance spokesperson did say that they are in discussion with the u.s government regarding quote potential solutions for tick tock u.s agreement so we are making progress on

SPEAKER_31: that front we'll see what happens everybody but we are watching the coming live just as you are okay

SPEAKER_88: you the founder friday brackets on monday apologies we couldn't get it today we had two office hours they were both great and we'll see everybody on monday he's x.com alex and i'm x.com jason

SPEAKER_513: blonde is x.com slash lawns and we will see you all on monday on this week's startups bye bye