SPEAKER_00: medic kept telling us to our faces that there was no truth to that uh whatsoever which was SPEAKER_02: also fun it lied about a secret project yeah it reminds me of like asking google if they were SPEAKER_05: going to produce a browser like absolutely not chrome it's like but wait on linkedin you have the entire team from mozilla foundation working for you now hey apple are you working on a car it's like absolutely not it's like what are these thousand people from you know tesla and car manufacturers doing in northern california at a racetrack the other fun side of reporting yes SPEAKER_10: straight up lying this week in startups is brought to you by gusto gusto is easy online payroll benefits and hr built for modern small businesses get three months free when you run your first payroll at gusto.com twist oracle oracle cloud infrastructure or oci is a single platform for your infrastructure database application development and ai needs save up to 50 on your cloud bill at oracle.com twist and linear linear helps product teams focus on what they do best planning and building great products streamline issues projects and product roadmaps in a tool your team will actually enjoy using get 25 off at linear.app twist all right everybody welcome back to this week in startups i am SPEAKER_16: your co-host jason calacanis here live from the battery you know that special private club in uh the bay area in san francisco great club on battery street and i was here in town taping a special episode of the all-in podcast last night at david sax's lp meeting um and i don't know if that uh special episode will SPEAKER_20: make me light of day but i did that in the favor bank with my guy david sax so that he comes to my lpd and to my events with me of course my co-host the one the only he's cautiously optimistic alex SPEAKER_23: wilhelm how you doing brother i'm doing um i'm doing fantastic but i i struggle we have a lot of SPEAKER_24: cool stuff on the show today we have a live guest tons of great stuff i i just want to say that it's hard to focus today just given that hurricane milton is coming towards our family in florida so SPEAKER_25: just you know let's all love one another show up help your neighbors send money send food whatever you can do let's just keep in mind that throughout all the politics of the current era we're all human SPEAKER_27: we're all here so let's just take care of each other well and i you know i think it's a really SPEAKER_28: beautiful sentiment um that we are all americans and then level up on that we're all humans and we SPEAKER_30: all suffer and we all are fragile and how fragile we are you know to quote uh uh poet sting from the police how fragile we are and uh it is you know that song always stuck with me because you don't feel the fragility of life you don't feel it until you do you know and uh when you feel it acutely that's when you see humanity come out and you know this is something uh we can all as americans even SPEAKER_36: in this divided time get behind um and we will on the next episode uh maybe share a link or two of how you can help let's pray we don't need to help we don't let people you know that this is uh not as SPEAKER_30: bad as it seems it's gonna be so and if you're there get the hell out of there i mean i got some family members i just got a text last night that some family members were debating going get the hell out SPEAKER_16: of there that there's this is not worth the risk you know to get yourself out of harm's way you're SPEAKER_36: loved so we got a we got a great guest uh you know this is somebody who i watched his whole career SPEAKER_16: like you alex and you know i'm uh a writer myself and when i hear somebody uh write something really good you ever get that feeling when somebody writes something really good and you're like god SPEAKER_48: damn i should have wrote that myself oh if i don't get that feeling three times a week i know i'm not reading enough but i do agree that in this case mg did turn out what the kids call a banger SPEAKER_50: he had a banger and you know i i read the banger and then i read it again today and i said you know SPEAKER_30: what he really summarizes a lot of the discussions going on a different podcast at the lp event i was at so we don't need to um uh belabor this but uh please intro our our live guest today here on this SPEAKER_47: week in service formerly from venture beat previously of tech crunch a short stint at crunch fund and then SPEAKER_25: 11 years at gv ladies and gentlemen please welcome to the show mg sigler yes here he is how are you SPEAKER_56: doing mg hey guys thanks for having me it's good to be here thank you for the very nice words to uh SPEAKER_30: to kick it off so uh let's get right into it uh you've been a venture capitalist and a journalist uh you and i share that there's a tradition of uh maybe a dozen of us who have done this oh malik of course michael moritz before that i just want to ask you before we get into your piece about venture capital and startups what what what did you learn in those early days at tech crutch when you and i overlapped a little bit um you know in the scene as it were what makes this such an interesting career SPEAKER_61: path in your mind when i was a you know a reporter i never studied journalism in school i didn't intend to go into reporting i was just sort of writing about technology on the side i was actually working as a web developer when i got the call um as alex mentioned the first first from venture beat and then eventually to tech crunch and so writing has always been sort of the through line and everything that i do um you know no matter what it is and so writing about technology uh you know ended up being very natural but i knew it wasn't sort of the the end state of what i was going to be doing um and so i honestly didn't think the path to vc was something that was open you mentioned some of you know some of our predecessors who had made the jump but it was a different time right back then and so uh you know i think that it helped being able to look at so many startups at tech crunch and and sort of recognizing patterns obviously and trying to see if if that could um you know translate but there's so much that when i first made that jump that i did not know what i didn't know uh and yeah so SPEAKER_63: it was uh it was a trial by fire very much in those uh early crunch fun days as alex is alluding to well SPEAKER_38: you know one of the things i i notice about the the two jobs the two professions uh and i'm the same SPEAKER_66: story i was not a journalism student i just started a publication because i wanted to write about what my SPEAKER_32: friends were doing and i learned journalism after it you know you when you you're a journalist you're trying to figure out reality and you're asking people questions and you're then building some sort of SPEAKER_30: mental model of the story you know like what is actually happening here and why is it important and you know you've got this journalism thing who what when where why it's kind of table stakes but when you get into venture or into elite commentary um you kind of have to figure out what's the bigger story and why it matters right and that is i think the art of venture capital which is squinting a little bit and saying huh if these things come together hey what's the world gonna look like right uh and SPEAKER_36: then the payoff when you write a piece alex is uh you know half the people hate you half the people ignore it whatever you know and then everybody moves on in venture you actually write a deal memo David Friedberg: and and then you place a bet and then you wait 10 years to see if you have you have state in the game right you got a lot of skin in the game uh and it's kind of like that doesn't exist in a story right SPEAKER_70: like most stories don't pop up 10 years later and you say how much money did i make or lose yeah that SPEAKER_61: was one of the early things i would always reference when people would ask me about that SPEAKER_72: jump it was like in journalism and reporting there was rarely the notion that you would sort of say no right obviously you would turn down stories every once in a while but sometimes a bad story right was SPEAKER_61: more interesting than a good story like about a bad you know startup that you viewed as as not performing well yada yada um in vc obviously you're saying no almost all the time and so that was SPEAKER_74: probably the biggest learning curve of you know it's like yeah i don't really buy this what they're SPEAKER_61: doing but you know you could sort of see the interesting story angle here but you know that just SPEAKER_77: doesn't matter for vc except for the pass uh on it and so yeah that was that was definitely a learning SPEAKER_38: curve uh in that regard alex why don't you um and i don't know if you have any thoughts on this alex yeah you're you're you're venture adjacent now you're in the investment team room you work at a David Friedberg: venture firm but doing uh random acts of journalism here i don't know if you have any questions or SPEAKER_83: thoughts there uh hearing us talk about it i've just been kind of curious though about about the SPEAKER_25: jump over because suddenly you're on the inside of the information uh table mg because as a journalist you're always trying to get bits and bobs of information from companies and then suddenly everyone's sending you their financials so i'm just curious how much faster did you learn once you jump from journalism to vc and suddenly you know the curtains were pulled back yeah this is an interesting topic SPEAKER_61: to talk about with both of you i mean because that that was probably i guess the biggest eye-opening thing is just you know not to um uh speak ill of of anyone in particular because it was really was like an industry-wide thing but there's just so much bs you know that's reported on that uh is just taken as fact right because as you know like people don't have sort of that inside knowledge and there's this very weird um you know dichotomy between those two worlds that really very few people are able to reconcile and so you know i think that that great reporters are able to sort of get close you know very close to the facts and and you know oftentimes of the best you can hope for is sort of just directionally accurate uh reporting right because again there's a direct incentive not to get that information out there and if people want to put the information out there there's obviously you know all sorts of other ulterior motives at play and again good reporters know that and you know that comes with experience often and so there's great ones out there who do all that stuff and have that in their minds but there's still this asymmetry at play always you didn't start SPEAKER_87: a company to run payroll did you of course not and that's okay because gusto is here to help gusto will help you run payroll and handle your benefits onboarding and hr all in one place don't just take my word for it 300 000 businesses trust gusto today as your startup scales gusto can grow with it don't just take my word for it 300 000 businesses trust gusto today as your startup scales gusto can grow with it state and federal taxes handled for your staff around the country handled finally time to offer 401k plans to your staff gusto's got it need to get your compliance sorted out well three out of four employees say gusto helps them be government compliant even better gusto is simple easy to use software so you can focus on what matters building your company so here's a simple call to action want all that gusto has to offer with no hidden fees and a discount to boot try gusto and get three months free at gusto.com twist that's gusto.com twist i'm really curious though the incentives SPEAKER_25: you mentioned that you know encourage companies to keep their information private in my experience one of the patterns that i've seen is when i meet a ceo of a startup who's willing to share more and just speak pretty candidly that company tends to do pretty darn well and the more secretive the more i don't know almost artistic about not sharing information someone is generally speaking the worse their company does and so to me companies that are open do better so what are these incentives that get companies to be so clammed up all the time when they're doing well and people would love to learn SPEAKER_91: about that to me that just speaks to like you know a ceo uh an entrepreneur who's in command of what SPEAKER_72: they're doing right if they're able they're sort of able to know the ins and outs of their business to such an extent that they can talk about it openly in a way that you know not everything's always going to be rosy of course but if they're comfortable enough both in their own skin and with where their SPEAKER_61: company is ultimately going and again a lot of that in my experience at least talking to various entrepreneurs comes from their own experience right multiple time entrepreneurs are better at this than than first-time entrepreneurs of course for obvious reasons um but again yeah it's just like a level of confidence in knowing like yeah it's really hard in these early days and there's a lot that's going wrong but we ultimately believe that we're marching towards you know the outcome that we want to achieve SPEAKER_92: and here's why you know even though the x y and z is not happening as well as it should be right now here's how we're going to get to that point i would love to read more of those stories and SPEAKER_48: do more of those interviews but i just think people are so media trained to avoid saying anything that SPEAKER_25: could be construed as things are going less than 100 perfect we end up with this very stilted SPEAKER_95: conversation that you pointed out occasionally misses the mark entirely and maybe the best we can do is get directionally accurate i just wish we could do better well i mean if you were to look at SPEAKER_97: it as a process right you you have journalists trying to figure it out you might have people on the SPEAKER_36: other side trying to spin it you might have other people just being candid and then you have game of thrones going on which we haven't even gotten to which is hey somebody got fired and SPEAKER_16: they've got a grudge or there's one vc who wants to approve a merger and get a huge payout from their carry and the other ones are already rich and they want to go for the ipo and you know they're you got competing factions how often do we see something like that you know the uber example comes to mind you know countless other companies come to mind where you have you know factions inside of a company warring literally at war like game of thrones or just somebody got fired and you know they or they got demoted or their idea didn't you know make it through and they have an agenda so um it is a messy process and the messiest thing going on right now i think is the venture industry itself so maybe um mg David Friedberg: you you started this piece off with this chinese character uh and this jfk reference one of the reasons i like writing is you have a point of view uh but you're also a good writer so you have some great illustrative moments and metaphors that make it worth reading as opposed to i would say nine out of ten pieces i see on substack which are just the author is trying to promote themselves or get followers here you had something you actually wanted to share so why don't you just tell us the premise of the SPEAKER_100: piece and why you wrote it sure thing yeah well first and foremost that image i as i noted in my SPEAKER_61: footnote there little um tag under the the image i tried like hell to get the right uh characters to show up in in an a in various different uh ai generators and it just would not work for whatever reason so you know we're still we're still in the learning phase with ai obviously but um anyway yeah so it kicked off basically aaron griffith at new york times uh who i think all of us know you know has been has been around for a while as well at different publications um she wrote the post about crv you know that i that i linked to prominently up top there um basically talking about how they were going to be returning capital to their lps because of the current situation you know that they view that we find ourselves in as an industry there's the piece right there um and you know and the framing of it was obviously wow like this is unique because you don't care about this often and you know she goes into a bit about how this has actually happened in the past obviously after the dot-com crash and a few other times um there have been you know individual situations where again vc firms have returned capital but you know where are we now and why is this happening now it seems like all we hear about is the open ai fundraise 150 plus billion valuation and boom times again and so what's what's actually going on here and i think you know i think that encapsulates that there's a few different things going on here but but you know it really is sort of the best of times worst of times in many ways and yeah just thinking through you know having stepped outside of being at a vc fund for those 11 years as alex mentioned and now started trying to look at it from a step removed a bit it's just like where are we actually in in sort of a cycle if we're in one and it does feel like um this is a strange unique time in that we're coming off of real boom times over the past decade and now again with this ai boom cycle going on but at the same time um we came out of sort of the post covet era and all the serp stuff going on where a lot a lot of companies a lot of startups are just massively overvalued and that's sort of what i guess is driving crv here yeah and the chinese character uh is SPEAKER_38: the word for crisis and as you mentioned it's composed of two characters uh put together and uh one of them is danger and the other is opportunity the danger here obviously alex people are going to lose a lot of money a lot of startups uh are going to go out of business or valuations are overvalued and lps are going to lose money and the whole system feels like it's kind of stuck at times and the SPEAKER_70: opportunity of course being hey if it gets unstuck so i think uh maybe talking a little bit about the David Friedberg: the unstucking of the industry is uh you know part of what i think is going on here hi alex is the SPEAKER_23: industry is trying to get unstuck yeah i think so there's there's two things that mg points out in the piece one is that there's too much capital in early stage and there's not enough i think good SPEAKER_25: companies to absorb it and then also that the late stage market back to the crv example is pretty SPEAKER_48: broken with limited exits uh evaluation overhang and so forth but mg it feels like both sides of SPEAKER_82: venture are broken at the same time is there a solution that's going to have a through line SPEAKER_25: through both issues or are we going to have to have different solutions for early and late stage SPEAKER_61: investing yeah i mean the early stage stuff is is fascinating that's largely where i focused you know my time in in uh in vc and you know and i and i think when i tried to again take a step back and look at what was going on you know in some ways it was natural that you know there are things that bubble up i talked a little bit about crypto right obviously that that was uh you know something that that bubbled up before ai came about and then sort of crashed itself very quickly um and you know is is still trying to find its legs under it right now but uh ai coming into its own is interesting timing because again as you know yeah there's so much capital out there all these make these funds from crv but they're even they're you know relatively small compared to some of the other players out there um who just have so much capital that they've been you know they've been looking for ways to put to work and so yeah late stage you know you pile in there into the quote-unquote winners and see how that works out but the early stage stuff is where you're really going to make your SPEAKER_15: returns obviously as a as a vc or you'd hope explain to the audience why that early stage is where you're going to make your returns i think just on a back of the envelope math and you know we we SPEAKER_20: too are i'm like super early stage zero year zero is where i've chosen to focus because i agree with SPEAKER_61: this premise yeah so you know the general rules of thumb like early stage you're hoping to find something that's a 10x return obviously you're hoping for even more than that right the ubers of the world and and whatnot that that can be thousand ten thousand x returns um but you know ultimately SPEAKER_72: yeah the 10x is is is sort of a reasonable um expectation for a great company um and then as you go later and later you know the gross stage funds looking for sort of 3x return you know potential SPEAKER_61: and so earlier stage are looking for things that can really really move the needle and be things that return funds entire funds all you know everything if it's a 100 million dollar fund a 500 million dollar fund if you can get one company and historically you know that's sort of the the grand slam analogies all the different analogies to to hitting home runs and whatnot um if you can find one of those companies that will return the entire fund that's how a lot of these these historic SPEAKER_72: funds have been made and so these days though because valuations are so high even in those early stages it's become harder and harder to do it and now even in our ai cycle like when even open ai SPEAKER_61: right their first fundraise beyond sort of the early seeding from elon musk and everything you know in that microsoft round whatever is valued at 3 billion or more i don't even know if it's it's ever been sort of officially announced whatever it was um but that's like the you know early stages of that artificial funding for the company is already over a billion and you see a bunch of those now obviously with people who spin off from open ai and out of google and from other places that are sort of experts in ai they can you know they still can set the price of whatever they want and so that just makes it really really hard obviously at the the quote-unquote early stages like look at safe super intelligence right that's that's one the ilia satskabbar one that that spun out um and that's i guess already valued you know at a billion from day one and so that makes it just very very very challenging potentially to hit the 10x let alone thousand x 10 000 x return yeah and SPEAKER_133: in a fund that had 40 names in it a venture fund when you start thinking about portfolio management SPEAKER_70: which gamblers would talk about as bankroll management you might have 40 names in a fund maybe 30 some funds as high as 50 taking out like seed and accelerators that means to return the fund one of them just to get to break even one x return you got your money back is a 40x if there were 40 names in the fund so that means it has to be a 40 billion dollar company alex we talked SPEAKER_112: earlier this week about how few of those there are uh i got absurdly lucky to hit two robin hood i think SPEAKER_137: it's worth 20 now billion i still have my shares and then uber i still have a lot of shares and it's SPEAKER_112: worth 160 billion but like that list of companies that get worth above in this example 40 billion you SPEAKER_70: can count in the last cycle since you the three of us started writing and investing you know i was a SPEAKER_137: little earlier than than you i think mg in the uh right before you i mean you can count them on two SPEAKER_22: hands give or take i mean maybe depends on what you count as like a tech company or what counts as SPEAKER_21: venture back but it's not that many names all right i am probably guessing you've got a huge cloud bill SPEAKER_139: coming in every month and listen you don't want to cut your team size right you need all those talented people you have but if you use oracle cloud infrastructure aka oci and you're hearing a lot about that today because so many people are using it you're going to cut your cloud computing bill get ready for it in half such a great deal all you need to do is move to the oci which is your one-stop platform where your infrastructure for your database app development needs and it's got ai built in where you need it most it's more cost effective than other cloud offerings oci charges 50 less for compute and 80 less for networking so you're going to save a ton in the cloud where you pay by the minute spending less ads up we all know that and these bills can get out of control and SPEAKER_16: that's why startups love oci so here's a very simple call to action oracle's very generous oracle has put together a special introductory offer that is available to you if you qualify oracle will chop your current cloud computing bill in half if you move to oci so check if your company qualifies at oracle.com twist this is oracle showing their commitment to me your boy jacal and the startup community here on the number one podcast in the world for startups and now there is a limit here this is limited to new oci customers in the u.s minimum financial commitment and exclusions apply SPEAKER_82: oracle.com twist that's oracle.com twist there's an interesting optimism mg in future exits and liquidity SPEAKER_23: evaluations that we're not seeing today in the market that contrast with the enthusiasm we're seeing in these investment deals so i'm just kind of curious what is the logic behind putting that valuation on safe super intelligence because i i get illia's fantastic but that just seems to be a number that's so high it almost it makes me doubt that this is a traditional venture transaction at all yeah i mean SPEAKER_61: i guess and i get into this a little bit in in that post i guess the hope would be that um there's a bunch of things coming into play now first and foremost obviously interest rates um you know coming back down and so if that helps to thaw or open the ipo window again which obviously has been pretty close tight um these past couple of years if that happens you know maybe there's an opportunity for some of these ai companies to go out there obviously everyone will look now at open ai given the valuation that it's at and and where else they can possibly go from a fundraise perspective uh SPEAKER_72: privately to be able to to keep bringing more capital which they'll obviously need to do it seems SPEAKER_61: like and so is there a window there and will the market be okay with you know potentially non-profitable SPEAKER_72: not non-profits but morphing into pro poor profit companies but still non-profitable in that they're SPEAKER_146: not making any profits um not non-profitable unable to show a profit these are two categories of companies SPEAKER_61: want do not have um i mean obviously historically you know companies have been able to go out at various times when they're not yet showing a profit and amazon's famous example right of for years and years not showing a profit but the promise of profits and so will the market be okay with that they obviously have not been okay with that in in recent years and want everyone to to be able to show those profits and and you know it took a while but uber was able to get there right in an incredible fashion airbnb has gotten there and so these companies mature into it um tesla and so but are we going to be in such a world where the air where open ais can go out and save super intelligence i mean you know as early as it is like will they be able to go out but a few other things obviously at play the biggest one there's just been no m a activity aside from these whatever you want to call it acquisitions you know these sort of acquisitions by another name that that the tech behemoths are all sort of pulling off hiring did you come up with that one hack acquisitions i don't SPEAKER_154: know if i may have heard yeah that's what i keep trying to push forward is as the uh the one that SPEAKER_153: should i'm gonna go with yours it's the best one i've heard today officially we're calling these David Friedberg: backdoor acquisitions what i call the terrible branding our hackquisitions so uh there were a SPEAKER_30: couple of these where microsoft and google bought the teams a license to the software and then somehow got money back to the investors yeah cap table yeah trying to figure out on a tax basis how that occurs without it being income because it's a license and then i realized wait a second i think a lot of SPEAKER_136: these fundings occurred on notes and if they occurred on a note which is technically a loan you could pay SPEAKER_16: the loan back with interest and you could do any type of deal you wanted with those investors you could say we're going to pay your loan back and give you 10 royalty or 10 in this or whatever pot sweetener and i think it would just be a loan being paid back which gets them out of the investment with upside in the shell company maybe pursuing a secondary idea because it seems almost every SPEAKER_156: time they leave some people behind on the island let's answer the phones when the when the feds SPEAKER_158: call i mean that's what i was thinking it's like wait who gets left behind in the shell company SPEAKER_25: the b players apparently i mean can you imagine how bad they must feel to watch the money ship SPEAKER_159: sail away you're on this little teeny island that no one wants anymore well i think what they do is they SPEAKER_30: say to to to your point mg like hey stay here for a couple years answer the phones here's a pile of cash and um you can just rest and vest it's like a no-show mob job like hey yeah just go sit on these chairs like the sopranos go sit on these chairs outside of the uh esplanade and pretend you're pouring concrete and we'll pay you 200 grand a year as a supervisor and you can just sit there SPEAKER_72: and drink beer i think that's what they're doing to be fair i think that they're so inflection which was the first one right that microsoft pulled off um and got sulaiman who's now like the in charge of all their ai efforts like that one sort of feels quite a bit like that it's unclear what inflection is still working on and in fact microsoft just rolled out this new product which looks like the product that inflection was doing the pie product right with their their new ai thing so like it seems like that was that situation the character one's a little bit different it feels like because yeah they were brought back into google the founders brought back into google and a few people like 20 or something of the company but they're still trying to work because they left them with like i guess this is all via reporting i guess uh the about 18 months runway so sort of your standard SPEAKER_163: fundraise right so they're still trying to make it work as like a more full-on consumer company SPEAKER_76: but yeah for the most part i mean these no one is under any illusion as to like what actually is going SPEAKER_72: on with these deals and again it goes back to the idea that just no real m a can happen because of the regulatory environment and so we'll see what happens again you know obviously post-election and and what what they do from uh you know the doj and and everything else and in lina khan's position um if that sort of changes the dynamics of of what can actually go forward with m a because right now it's just like the all the tech companies that would normally be buying up some of these startups SPEAKER_61: for talent if nothing else no they can't really do that hence the acquisition model um you know trying to be able to do that until they're told to stop which you have to imagine after a number of these SPEAKER_72: like someone probably says like yeah that's enough of this um type of thing but for now they're they're SPEAKER_153: going forward did you say it worth the squeeze i mean that's what i'm hearing from the other side SPEAKER_136: which is after figma paid i don't know what adobe paid it might have been a billion dollars yeah SPEAKER_168: the kill fee was a billion yeah that's why alex is here because he knows everything he remembers SPEAKER_169: everything that's things yeah i think that that's just that's things your legal teams are bogged down SPEAKER_118: forever like you know trying to work through yeah it's just right it's not worth it well and then SPEAKER_169: the product team right what happens to the product team mg if the product team is like well we got to SPEAKER_30: compete against figma and it's like no no we're buying it and it's like okay we're 18 months into buying this thing and we're still losing market share to them and we don't have a product in market and SPEAKER_170: our customer base is like hey when can we make mock-ups faster and you know it just freezes everything SPEAKER_72: yep and so so yeah so those those two elements obviously being huge drivers of of if this whole situation can flip can thaw a little bit because it's not the m a thing everyone's like oh my god you know god forbid google or meta can't buy another company but really like and i mean you know this you know better than anyone jason like there's like the trickle down effects of all this which i just think the second order effects that people especially you know the current um i guess regulatory environment just doesn't take sort of take into account is that like these diasporas of acquired companies are like what flow back into the system and basically keep it going and because there's no exits right now it's just like everyone is stuck and it's it's just not good for anyone and it's not just about the SPEAKER_70: big companies being able to acquire things right i mean this is existential for capitalism because when you have a an ecosystem if you were to look at this like an ecosystem like the ocean right if you SPEAKER_136: take out you know some of the predators and then some other species there's too many minnows then the minnows eat all of the plankton then their plankton gets screwed up and then the whales have nothing to eat it just causes chaos the singles and doubles are really and the tuck-in acquisitions we call them singles doubles uh you know um aqua hires all of those things keep talent moving SPEAKER_16: they let you retire projects that are not breakout projects and shouldn't be funded and then take up time on the dance cards of the vcs so you know if you are on i'm assuming a dozen boards or eight boards something in that like a typical uh venture capitalist is if you've got three or four of those companies that were then being able to acquired now that gives you room to breathe and to take on three new projects to keep society and innovation moving now we're sitting here with SPEAKER_18: 12 year old copy stripe is still not public what's going on right and stripes a great example of that SPEAKER_72: right the callisans had a first startup that was acquired and was fine but it wasn't like the massive outcome but how many of these now massive companies are a result of entrepreneurs going back out there SPEAKER_177: because they were able to get some sort of uh exit and you know move on from that initial idea actually SPEAKER_38: off the top of my head zip 2 for elon uh and uh red swoosh for travis and uber that was like a 30 million dollar sale for me weblogs inc a 30 million dollar sale like you can add up a lot of SPEAKER_30: these 30 million dollar 100 million dollar 200 million dollars sales that you know get the founding SPEAKER_136: team 5 10 20 million bucks not enough for them to retire they still have but it's enough for them to SPEAKER_72: actually fund their next company to mvp yes and feel good about moving on from it and and everything SPEAKER_92: and those just are not happening at all right now which is wild well the good news alex is i spoke to SPEAKER_133: reid hoffman and sax were and i were in the illuminati meeting the other night and they uh SPEAKER_183: they told me in the illuminati meeting that lena khan's not gonna have her job in january so you know SPEAKER_25: what i just really want to have jason live on camera if lena khan gets her term extended because his head's gonna literally explode but i want to point out a slight conflation of deal sizes here because i heartily agree that the singles the doubles the talent acquisitions should be allowed to go through no matter the acquiring company small dollar deals let's go have a lot of fun the adobe figma deal was 20 billion dollars and was an incumbent player taking out what could be a real challenger to their business that's the creative destruction that we want to see from startups so to me the figma example i don't think fits into the we really need to have better capital recycling and so forth i just think they're distinct given their size difference i think that that's SPEAKER_72: probably fair i mean i don't i don't know enough about that specific deal but like some of the SPEAKER_61: others are just when when they were investigating uh meta for buying the fitness the vr fitness company uh amazon not being allowed to buy i wrote like the vacuum the robot vacuum company like what are we SPEAKER_72: spending time on here and you know let's like let's let's keep this all moving yeah fight the real enemy David Friedberg: here like these are those were tuck-ins those were tiny and and i it felt like those were vindictive SPEAKER_136: uh slaps on the wrist like maybe i'll just show you we're not gonna let you do anything those were kind of like little jabs to say like yeah you know what remember you bought youtube remember you bought whole foods remember you bought you know the you know whatsapp and instagram we're gonna stop even SPEAKER_166: before that and they worked there was a chilling effect there's nothing that like these these discussions just aren't happening now because of that just to not belabor all of this um what this SPEAKER_30: also does to capital is if you're an lp in funds you have this uh great excuse um and a valid one to SPEAKER_16: say you know what we're going to trim the number of funds that we commit to and we're going to take our commitments down and when i went on raised my last fund and i talked about it here on the program i had about i would say 80 of people say to me when i said hey we're raising our next fund they said i'll meet with you but we're pencils down right now uh for obvious reasons we're waiting for returns to to recycle and we love you we don't want to waste your time but we will meet with you because we want to hear your vision and i took the meetings and i said happy to take the meeting because then we'll at least start the relationship building for fun five and you know i was at this lp thing last night and some of the same lps who were literally not allowed because of their committees to invest in our fund there were pencils down they told me hey you know and they kind of felt bad but they didn't participate in the fund and they're like we really want to talk to you about fund five like we got some dpi returning we got some things happening so so talk about green shoots if we know 2024 has been just frozen 20 25 is looking like a really good setup here new administration stock market at all-time highs soft landing feels baked in maybe we have a little recession but we can manage it you know uh infl the rates and the inflation broken unemployment at a good number we're still hiring people but it's not like out of control what's the best case scenario if we flip on both switches m and a comes back and the ipo market comes back and we see stripe go out and maybe spacex goes out i don't have any information or anything or starlink spins out like people are saying you know whatever we see five or six of these things happen in in 2025 what's that what's our SPEAKER_118: best case scenario here mg um yeah i mean all that sounds like a sort of best case scenario obviously SPEAKER_72: yeah this year is totally moot like no one's going to do anything before the election once the election's over you don't have enough time really right to sort of make the call on on doing anything this year and so i think all of those things m a is probably going to take longer than the ipo window i would imagine to come back because there's all these like even today right like there's there's news about all the antitrust um you know stuff in process and and everyone's bought like legal teams are bogged down in that right so it's like that some of those teams would be working on different m a deals and so i think that that's still going to take a while to come back but i also think sort of going back to the earlier points there are still just unfortunately a lot of companies that remain massively overvalued from that last cycle and so you know companies are either going to have to figure out what the outcome is that they're willing to take there um and and have more hard discussions obviously a lot of those have been had and and you know some companies have have taken down rounds and whatnot but there's still going to be more of that into next year so i think like your scenario is like the the pie in the sky rosiest one that can play out but it's probably going to be you know some sort of hybrid of things thawing a bit and getting better but it's still going to be a sort of long road with the wild cards of like whatever is going to happen with ai like what are those outcomes SPEAKER_149: going to be like what do new companies how many new companies pop up and what do those start to look SPEAKER_72: like because i'm also fairly fearful i would say about those a lot of the early stage ai companies that are just gonna sort of i if i had to extrapolate out i think will quickly realize that there's not really much of a of a big user-based product there beyond sort of uh you know the big SPEAKER_100: companies that are that are doing everything already right now and so you know that can also have some weird effects on the overall ecosystem i think next year if you want to build beautiful software SPEAKER_197: products well you need a beautiful development platform but most issue trackers just aren't SPEAKER_18: helpful and they feel like a chore to use but linear is different it's developer first incredibly fast beautifully designed and it's purpose-built for how modern product teams work with linear you can streamline bug reporting and test tracking plan and spec new features and manage your long-term product roadmap that's why linear is the tool of choice for tech companies of all sizes half of why combinator companies build with linear and it powers cash app scale ai and versell so here's your call to action see for yourself why product teams love linear visit linear.app twist to try linear for free with your team and get 25 off your first year that's linear.app twist on a consumer basis you you think that uh SPEAKER_30: meta putting an ai search box at the top siri now i don't know if you've been playing with the latest ios SPEAKER_201: 18 do you do you install the bait on your phone yeah yeah i have it it's yeah it does the glowing ring SPEAKER_36: you can see they're taking it pretty seriously very pretty uh uh you know i was talking to sergey the other night there's a name drop for you um they're taking it super seriously i can tell you that and you're starting to see it show up at the top of search results you know the little little google uh gemini box uh and microsoft of course with copilot and then you have chat gpt with 300 400 million monthly active users and this incredible app who's going to win let's call it the the 50 of queries questions you know that are pretty easy hey tell me about the history of pink floyd you know hey what's what's in the news today what's a great recipe for salmon all that kind of what would be the weather SPEAKER_16: equivalent the play the song for me equivalent in siri and alexa and that those early promising days SPEAKER_61: when who's going to win the consumer uh query race i would imagine that at massive scale so you talk about yeah like open ai which is at an amazing scale which at gpt with hundreds of millions of of active users which is incredible for you know a relatively early company though obviously the company's been SPEAKER_130: around for a while but a relatively early product is incredible um still i and when you think about SPEAKER_72: the billions of user scale i come back to the idea that there's you know there's the apples and googles of the world which have inherent advantages with their devices in a billion pockets already and are people going to go out of their way to download a new app um to be able to use some of these services they have to be above and beyond better now i think um chat gbt and open ai have done an exceptional job SPEAKER_61: of becoming sort of if not a household name at least a brand name that people know right and and again all credit to them for doing that and they've also done a good job on the product side like those are SPEAKER_72: those are good products and obviously they had microsoft's help with all the capital and cloud credits and whatnot to be able to scale to where they are um but still do they have enough to get over the chasm and it's really a race in my head of like once these are all baked in you bring up siri and gemini once these are baked into all of those billions of devices are is anyone going to be able to to compete with that and that's probably you know like one of these real questions in the next sort of couple of years because you've played with it the new series like stuff it's so rudimentary it's nothing compared to what open ai is doing and the gemini stuff is definitely more advanced um but still like it still feels very very early compared to where it's at the way i would describe it talking SPEAKER_36: to siri you know this ios 18 ai apple intelligence is like talking to a toddler and then i think gemini is like talking to a really smart teenager and then chat gpt is like if you're using oh one it's a graduate student if you're using the regular one it's college student and so how quickly can that compress and you know we're talking to a phd student and then i think we're probably arguably maybe a year or two away from when you talk to one of these things you're talking to the smartest human being on the planet and they're and and the next 10 smartest people in a room as your servant like SPEAKER_16: literally it's so clear to me that your discussions will be as if you had the 12 smartest people in the world in a conference room and you just came in and were like what should i have for dinner that's healthy and my daughters will enjoy and like einstein and nietzsche and you know elon musk and SPEAKER_217: steve jobs all figure out what you should have for dinner tonight like and they have a four hour conversation about it and then yeah that's what you're having for dinner 12 most effective smartest SPEAKER_22: cleverest people in the world i don't know if that's who i want to plan my dinner party per se SPEAKER_23: no jerry seinfeld's in there too yeah okay yeah because that i'm you're going to be like one crouton some duct tape like that's a strange it'd be a very deconstructed dinner but how how are those SPEAKER_149: actually translated into products right like because that's what we'll met so we got all these other SPEAKER_72: startups like the perplexities of the world and anthropics all great products but are they going to be enough to cross sort of again like the the inherent advantages that that apple has that google has with their products and market and obviously that's that's why you hear about the reports of sam altman and johnny ive right whatever sort of product they're trying to work on because if you can have some sort of actual physical product that's going to give you at least some opportunity and this is what zuckerberg has been talking about for months and years right at that he feels like meta SPEAKER_61: uh overall has just been at an inherent disadvantage because they don't have a phone right and so now they're trying with the glasses and they tried with sounds like they should have let your mob do it David Friedberg: yeah yeah yeah no yeah back in the day he was like literally meeting with phone vendors about a facebook phone and if even if they had just done it and it had five percent market share right now i SPEAKER_118: remember that very well jason because i was reporting on that back in the day for tech crunch and and SPEAKER_00: meta kept telling us to our faces that there was no truth to that uh whatsoever which was also fun SPEAKER_02: they lied about a secret project yeah it reminds me of like asking google if they were going to SPEAKER_05: produce a browser they're like absolutely not chrome it's like but wait on linkedin you have the entire team from mozilla foundation working for you now hey apple are you working on a car it's like absolutely not it's like what are these thousand people from you know tesla and car manufacturers doing in northern california at a racetrack the other fun side of reporting yes yeah exactly SPEAKER_225: straight up lying i was just thinking about your time at gv and how that is part of the broader SPEAKER_25: alphabet world and other venture capitals often the ones you're describing in the piece are more traditional firms and i was just curious does being a cvc in a period of time in which traditional venture lps are being more conservative does that mean that you don't see your firepower decrease and does that make cvc i don't know a more advantageous place to be investing from SPEAKER_102: when the markets get weird yeah i mean at a high level you that you'd think that's the case but like SPEAKER_72: the way google ventures is always set up was really to be a straightforward vc fund right so we're just thinking about the returns and yeah it's nice to have obviously one lp who was happens to be one of the largest companies in the world um as the capital source because yeah you have to worry less SPEAKER_149: around you know a lot of the stuff that jason was talking about but still you know there's all the SPEAKER_61: inherent tension is still there with like if you're not bringing capital back in like you know what's SPEAKER_234: what's going on here is that ever going to change is it ever going to start to come in again so a little SPEAKER_25: bit less but you're not free from all the considerations but it might be slightly more stable during periods of extreme change okay that's less than i was hoping for yeah yeah i think it's it's fair to think of it SPEAKER_72: as like if the if the mantra is like we want to be long-term capital and everyone says that but when SPEAKER_61: you have the one lp again like that can really sort of take that uh and not have to have volatility in SPEAKER_24: that i guess yeah it's very convenient all right and just before you go uh favorite ai tool you currently use jason and i were just talking about notion which has lots of ai all the way through it SPEAKER_91: so mg what what floats your boat in the ai world today i'm boring so i mean like i still use mid SPEAKER_61: journey a ton because i'm doing all this image you know stuff trying to for different posts and stuff SPEAKER_72: so that's that's definitely something that i've been trying but i am very interested in all the new voice stuff so obviously um uh chat gpt finally rolled out there uh you know 4-0 voice um assistant stuff and and google has theirs out there they're pretty compelling when you compare them to what like we talked about like the early days of siri but also alexa right and and apparently amazon's working on coming out soon with whatever their new version is but um but these voice things are pretty uh pretty interesting and fun to play with all right well that's a good encouragement for me to get off my SPEAKER_24: backside and use more of them um but jason i think as long as my dad still wants to use chat gpt every SPEAKER_48: day they have found product market fit because that guy does not like technology i am now up to SPEAKER_32: 30 to 50 interactions with 01 per day and i told my entire team if you open a new tab i want that tab to be 01 and i want to see everybody on of our 21 person team here at launch and this week in startups SPEAKER_30: using it at least 10 times per day anything you're going to work on start at 01 ask it a couple questions and then ask it a couple follow-up questions and it's unbelievable my favorite one now i do is hey SPEAKER_36: check your work i think you could do better and uh make the answer you just gave me you know more concise and check your facts and it almost always does a better job it's like this is like dealing with people out of college again you know they whatever they whatever they bring you when you're David Friedberg: the editor-in-chief and you're like this is good can you um spend two hours and make it a little bit tighter and they say how do you make it tighter i'm like i'm gonna leave that up to you this is when i was busy and i was an editor and then they bring it back and i read both of them SPEAKER_16: at the same time and i say well how'd you make this better and they explain it to me and then i start the conversation it's like really interesting all right listen mg you're awesome uh come on again and uh congratulations on all your success and if you uh want to read somebody's words that are worth reading and not a waste of your time with all these garbage chat gpt created blog posts go to spyglass.org SPEAKER_207: i don't know what spyglass.org is you used to do paris lemon what is spygas.org i always every every SPEAKER_00: few years i just have to reinvent and yeah go go back okay i like it spyglass.org you can get there SPEAKER_207: and uh yeah you can get full access to the inner ring a hundred a year go pay for it go to the inner ring for 10 bucks a month why not all right everybody uh that's mg siegler and uh we'll talk SPEAKER_249: to you soon mg congrats on all your success thank you both it was fun alex uh it looks like we have SPEAKER_54: time for one more news story if you have the time uh and i got time we have lots of good options so you SPEAKER_23: may choose between google getting hit with a possible dissolution or nobels for computer nerds SPEAKER_25: or how the data center wars are still raging your choice i think we got to go with the google breakup David Friedberg: we know that the doj has won this case against google and it has to do with the search and the advertising monopoly that's where we left off and we were all waiting for the other shoe to drop which SPEAKER_136: is what is the remedy okay we know that they're guilty we know that they're guilty of maintaining a monopoly am i correct in my recalling of this yes so august 5th 2024 the court found that SPEAKER_23: google was liable under quote section 2 of the sherman act for maintaining monopolies in the u.s general search services and u.s general search text advertising those are not small markets jason they are SPEAKER_256: tens and tens and tens and tens of billions of dollars a year in revenue so what does the government SPEAKER_25: want well i went through a very long filing and it's very detailed and there's lots of things that are going on but the biggest headline that came out was the following quote plaintiffs i eat the SPEAKER_23: government are considering behavioral and structural remedies that would prevent google from using its products such as chrome pay and android to advantage themselves structural remedies is as it turns out SPEAKER_25: code for this company could get broken up so the headlines you're seeing are doj considers breaking up google that matters jason if you had to lay a bet percent chance that google google gets broken up SPEAKER_22: from this just just tell me honestly what five percent i would say under five percent yeah like SPEAKER_16: maybe one percent these things are always a negotiation um if my memory serves me collect correctly when this happened with microsoft uh this took a very long time to hash out and it would probably go across administrations and so this doj case with google i believe started under trump and maybe even before trump's uh term so these things tend to go across uh administrations and then the remedy as i just said in our closing comments with mg i'm doing 30 queries a day 50 queries a day uh on chat gpt first now will google win me back as i told sergey brin they gotta have a killer app i want to work in an app i want to have a destination to go to that is solely for this so i need a gemini.com app or a gemini app that i just go to and i live in and a domain name that doesn't have the shoehorning SPEAKER_136: of gemini into google search i don't want that i want 100 experience like youtube is right like when David Friedberg: you go to youtube it's not like google you know youtube.google.com or google.com youtube you have to hit another tab like they did with google plus their social network it's got to be its own brand with 100 of interface and ui around gemini okay let's put that aside for a second uh the obvious remedy here is to not let them do the deals that they do with apple and so break up the apple deal that would be the obvious concession or hey if we have too much market share we spin out youtube and i believe spinning out youtube creates more shareholder value is a very clean break it doesn't break the advertising system yes those ad networks are all integrated etc but what you would say is you know the SPEAKER_36: ad interfaces have five years a full five years to be you know separated so you have this sort of grace period of you know you just can't flip a switch and break those things up they're all on common infrastructure so youtube has a five-year deal with google or alphabet to host you know their content or whatever they can use gcp if they want um but then eventually the ad interface and the logins have to kind of separate they have to have you know google has to have under 30 ownership of it and not have board control so you come up with some way to kind of do that kind of spin out is i think SPEAKER_16: two things that could happen that would be a nice way to balance this but overall the market will have SPEAKER_207: solved this problem is my prediction long before the department of justice does there's an interesting SPEAKER_25: commentary about the legal system and its pace versus the current pace of change in technology and can you even catch up by the time you complete the legal task maybe you've missed the entire SPEAKER_24: next cycle but there is some cool stuff in here jason i'm not gonna lie i know that this is not the um the we love antitrust podcast weekly corner uh but i do think there's a couple of cool things that SPEAKER_139: could happen through this that might make this and this stuff these remedies where are they coming from this is the government filed and said this is what we want or this is some leak oh explain to us SPEAKER_238: the provenance of this yeah this is the judge in the case saying here is what we are considering SPEAKER_25: for remedies they are still in discovery there's more i think they want to go learn more before they make any sort of like actual thing and to be clear google is going to fight this the whole way down SPEAKER_23: uh but a couple of things that did stick out to me one you nailed it uh one remedy that's being considered would quote limit or end google's use of contracts monopoly profits and other tools to control or influence distribution channels that is the big search deals that google uses and the reason why the government cares about that jason isn't just it's a lot of money and it's buying access it's that google by having access to all the searches gets more data more data better search SPEAKER_25: no other people can't get in so under am the accumulation and use of data remedy section the government is considering forcing google to make quote available in whole or through an api SPEAKER_271: the indexes data feeds and models used for google search okay wait let's pause on that yeah explain David Friedberg: that in planning your interpretation of that in plain english what would that look like would that be you know similar to brave uh and their uh search api they have for their excellent search SPEAKER_16: uh product and you can then use it as an api i think bing has some access to search results that they'll let you do on your website so what what what do you think that would look like in plain english a startup could do what i mean i think they could build their own variety on top of google now i don't SPEAKER_25: know about pricing packaging you know legal access and so forth but i think you're going to get one or the other here if google is allowed to continue buying default status on you know billions of devices SPEAKER_24: as kind of mg was talking about earlier then the the remedy would be to say okay cool you can have all that you can be for stories but you have to let other providers who want to get into the search game i.e startups to have access to at least some of that information you're collecting so SPEAKER_25: that way they have a shot at competing with you or if they lose the the default status then i don't see the government going after this but it does kind of give a couple of options about where the legal system might come down on google here but the idea of opening up the google black box jason for other startups to build let there be 10 000 search i tell you be careful because sometimes SPEAKER_16: the remedy then creates another business line that can make them more powerful and this is hilarious because they might if they if they spun out youtube the amount of cash that google would get would be hundreds of billions of dollars i think it's a 500 billion dollar company out of the gate yeah and you and google would get 500 billion dollars right if those shares had to be floated to the public or over some period of time i think it wouldn't take long for google to clear that position you know i've David Friedberg: never i don't know if there's a precedent for that but you know if they made it public and they owned 100 of the shares the day before it goes public and they allow the public to buy 20 of the shares and then every year they commit to lowering by 20 or something it would take four years or something maybe to clear their position with the compounding you know impact of that um so that would be great now google's sitting on a pile of cash that they can invest in ai and other products and services okay now let's move to the next step there was something called yahoo search monkey uh back in the two the early 2000s i'm talking like 20 years ago this is before my time so i'm here SPEAKER_159: to be literally yeah so here's what the i just asked chat gpt 4o about it and um it said they this David Friedberg: is the features uh according to looking at some um historical data from from yahoo enhanced search results search monkey allowed developers to enhance the display of search result with rich data such as images ratings and custom layouts uh structural data integration the api supported structured data from websites like microformance rdf and rss feeds those were blogs um and then custom result templates developers could create custom templates for specific websites or content allowing search results to look more engaging and tailored in other words if you wanted to create perplexity SPEAKER_136: with google you could use google search results and say hey i'm going to create something for um travelers and i'm going to make my own travel website and with yahoo search monkey you could SPEAKER_16: build that right and just say i want to show flights over here i want to show hotels here etc and you could have uh really interesting things then user control you just had the option to enable or disable specific applications that affected how their search results were displayed in this sort of came before algorithms but imagine a customizable and this is in 2008 and then it shut down in 2010 despite everybody having um a really big love of this and then uh brave now um has their own version um SPEAKER_53: explain brave browsers uh version of this search api if you're curious about how today i will replace SPEAKER_27: jobs uh watching jason ask chat gpt questions live that he would have usually asked before the show so SPEAKER_287: i would ask a doctor research yeah yeah this is literally me being slowly machined out of existence SPEAKER_136: yeah i got six months left y'all well no what this is doing is we would have done i just remembered the David Friedberg: search api when we were having this discussion you triggered that and so you know everybody gets to learn together um and so you know this is uh essentially what this would do is like let startups SPEAKER_288: um really uh great user first products and uh so go check out the brave search api you love brave and SPEAKER_36: then you use the brave browser every day i am it's um it's my standard i i basically keep two or three browser windows open and what i'll do is i'll use brave as my primary and then i'll have chrome for David Friedberg: maybe like one account and then i will uh on my pc you know use microsoft once in a while keep up with that SPEAKER_36: and then on my my macs sometimes i'll check out safari um and i'll also check out firefox and chrome David Friedberg: i just i like to around but i think brave has a really good job of like keeping your privacy and everything protected um and uh it takes out a lot of the cruft on the web which is like important to me because it speeds it up so it's kind of like having an ad blocker built in but uh a lot of the tracking i'm not i'm not objecting to the tracking as much because i don't care if i get tracked because i use a vpn so like they're tracking somebody from like boise idaho it's not me and i rotate my ip automatically with a with i use new word vpn and express vpn um i think one of them is a SPEAKER_70: sponsored program but i maintain both of those accounts and i and i i'll use different vpns at different times especially when you're in cafes and stuff like that and people could be yeah you have to SPEAKER_38: try try or i travel a lot right so you want to you want to make sure people don't intercept your web SPEAKER_296: traffic over public wi-fi networks long story short um it's really a speed issue for me too like the web is so much faster when you take out all these cookies and things bogging you down so long story SPEAKER_16: short um i think what will happen is um this will wind up having zero impact ultimately this entire case SPEAKER_70: could have the majority case the 60 70 case that this will look as if i asked you what was the impact SPEAKER_24: of the microsoft antitrust case well okay here's here's the thing about that microsoft was supposed to get broken up they got out of that microsoft survived became now a three four trillion dollar company do you think or do you not think that the case had a impact on how companies operate because to me microsoft ended up walking away slightly unscathed but the government said no being highly SPEAKER_21: abusive platforms and do you think that had an impact or or not i would say the blunting effect of SPEAKER_16: it was distraction of the management teams and so i think the distraction is why they probably missed the phone the smartphone and why we're not sitting here saying it's microsoft versus google versus apple or apple versus um apple versus microsoft for dominance in smartphones since you know microsoft does not have SPEAKER_24: an operating system on smartphone that's it yeah well you know what they gave up on windows phone remember that meme with the guy in the diamond mine you know i think they were like 24 months and 24 SPEAKER_23: billion dollars away from making windows phone stick uh quickly though to be fair to google they did talk about this they have a response up uh quote this is the start of a long process we will respond in detail but they are trying to make the case that all of this is not just bad for for google but it's bad for you jason um quoting from them forcing google to share your search queries clicks and results with SPEAKER_24: competitors risks your privacy and security that's solvable by removing pii but sure but yeah that does SPEAKER_30: when you read the privacy part of it i'm like how does that work exactly that one seems strange um and if it was available in a product where you could say tell me about this user so i could target an ad and i will give you 10 of the ad that was retargeting and that kind of existed and then apple broke it yeah in the smartphones and brave breaks it so anyway i that seems like a weird one i think this this is going to come down to a very simple thing they're going to just say they're going to put a David Friedberg: they got a gun to google's head they're going to say give us something and give us something could be chrome google chrome could be the search deals with apple and that 30 billion or 40 billion whatever it is or it could be youtube in other words somebody's walking the plane yeah right they want to sacrifice and they're just you know gonna put something up as a sacrifice and we'll see if the the government SPEAKER_133: gods accept that sacrifice it's a blood sacrifice something's getting chopped off who who is the SPEAKER_25: the least liked child amongst the google properties that could be spun off this because you mentioned youtube by the way i pulled up a list of the largest corporate spin-outs in history the largest one ever was 191 billion dollars so if youtube was spun out it would be the biggest ever by a multiple yeah so i don't think it's youtube what would you sacrifice it's not going to be chrome SPEAKER_30: i mean chrome is an interesting one because it has over a billion users and chrome as an independent SPEAKER_136: company could it survive or not without i mean with a billion users now i think it could survive SPEAKER_16: um and it does make a fortune uh in terms of google search revenue because it's a default search so they could say hey you sacrifice i mean i think maybe they're overlooking the power of chrome in this whole thing if they said you have to sacrifice chrome or android that would be truly SPEAKER_23: damaging google says splitting off chrome or android would break them space and many other things so google really agrees with you the tricky thing here is i don't think there is something that's easy to SPEAKER_311: slice off without a lot of things bleeding youtube is easy yeah youtube is easy i mean just the ad SPEAKER_321: network but if you think about it like if you're buying search ads and you're disney buying search ads SPEAKER_16: and you're disney buying youtube ads your ad agency now has to log into two different services and upload the ads and read the metrics guess what they're doing that for facebook in the facebook interface for like three or four different products they're doing it on microsoft and bing they're doing it for tick tock so it's like okay instead of having to manage 10 ad networks we got to manage and 11. they've already got that issue solved in the ad industry so that's a clean one the thing about chrome is think about how integrated chrome is into google docs and gmail and oh absolutely your account that's a really dangerous one and i think that that and because that when when we look at consumer protection well none of us pay for chrome chrome's free and chrome gets better and then they put a password manager in it and then they you know put ad optimization into it they you know all these different pieces they put into it for free kind of like harming consumers by making that paid um or making it its own thing so anyway it's it's it's messy SPEAKER_32: they're gonna put a gun to their head you know they could give up home automation that would be David Friedberg: like such an easy one like here's nest here's google home like nobody cares um and so that's not like it's a hundred billion dollar asset or a trillion dollar asset or anything so man can you SPEAKER_25: imagine how sad that would be like the government brings this big case against against google gets them declared monopoly in the courts goes to remedy and it gets nest like i mean that would just SPEAKER_48: no events to nest i mean my wife's family uses them they're great but that's not what i think of when i think of google any other great questions or comments from the audience well there's a couple there's a couple of comments that are interesting uh seven racker says there is no capitalism once SPEAKER_25: uh advanced super intelligence i think they've been agi there yeah i'm sure there is a transition period but once agi but agi communism is where we are headed you know here's the thing everybody i joked earlier about my my job getting taken away i'm not actually worried about that to be clear but SPEAKER_48: we are going to see a lot of displacement and you know jason we've talked about ports and and strikes SPEAKER_25: and such i do become curious if something like um basic from the expanse series of books and shows does become the norm the point of basic was that it wasn't a luxurious support but it was you will not starve if you live on earth and i i wouldn't be shocked if we ended up with something that's not a good living for free but as we automate and machinize our economy something comes up yeah i mean Chamath Palihapitiya: in the united states today and in some you know canada advanced uh civilizations in europe the idea that SPEAKER_183: somebody would starve to death like they did a hundred years ago it was very common uh or today SPEAKER_36: in certain cater ships where you just can't get food to people because the dictators stop it the idea David Friedberg: of somebody on planet earth starving is like what i mean many more people dying from obesity and obesity related diseases than starving seem to have that one and then shelter it's kind of like SPEAKER_183: well uh you know if you live in a modern american city you might not like the uh you know shelters David Friedberg: you would have to go to and they would be dangerous and there's all sorts of issues but you would not be without a place to get shelter and if you beg some family member if you had them to stay you know in their shed you would have it again not super luxurious so but i do think that concept of the basic SPEAKER_183: yeah and that's in that that's in the series expanse is basic universal life credits SPEAKER_225: yeah there's some sort of currency you get and there's a subplot in which they come back to earth SPEAKER_25: and then they have to exchange their currency and it's interesting but the point is it's a coffee and SPEAKER_23: a muffin it's not you know catered lunch um just one last one before we go so sebastian asprella says SPEAKER_25: with chad gpt we will no longer need consultants i wonder if the likes of deloitte kpng mckenzie etc are taking this into consideration wrong you are correct that chad gpt can replace most of the work consultants do but you do not hire consultants because you think they are actually smarter than you you hire them so that way they tell you to lay off staff and then when you cut you don't feel bad about it because you're just doing what the experts recommended consultancies are ways to sync accountability somewhere else so while chad gpt is great no it cannot do that so mckenzie will still SPEAKER_284: be employed cockroaches will outlive consultancies jason but that's it well yeah with the consultants i SPEAKER_16: think what you'll see is uh because one of the firms that had part of their mandate was they never did a layoff in their history it might have been mckenzie was the one that never did a layoff i'm trying to remember which one had that rule or that like bragging rights they have recently started offering buyouts which are technically not layoffs people choose to leave because i do think when you watch people do queries on you know oh one and claude yeah you there's probably the bottom third of consultants are not David Friedberg: necessary anymore and so then the question is does it become the bottom two thirds and can one of those consultants do the work of a hundred and the answer is yes like the query i just did about give me the history of yahoo search monkey was about five hours of work for an average producer i think maybe two uh for a good one and so that's two to five hours that i didn't need somebody to do for SPEAKER_48: me right yeah and ai then is the death of billable hour wastage maybe is the way to think about sure SPEAKER_136: yeah and so then the question is is there more advanced stuff to do i don't know because some David Friedberg: problems are finite so as but one example doing your taxes i was talking to somebody in that industry and they said listen i said to them hey but isn't there always some more financial modeling and stuff to do and they said to me not really he said he thought that they would need to be a much smaller organization that they would be more profitable but the top line could the top line billing could be challenged and certainly the number of employees needed would be less so he agreed with me that earnings would be SPEAKER_170: dramatically more and that headcount would be less which then goes to static team size but in this case it SPEAKER_255: would be earnings we got to come up with our own uh thing about surging earnings yeah uh so we'll call SPEAKER_16: it surging earnings for now or earnings expansion so earnings expansion static team size you know are the sort of two sides of the same coin there or part of the same system that we're going to see so it wouldn't be surprised if you saw a top law firm say you know we're going to have 20 less lawyers SPEAKER_23: and be 30 percent more profitable so i think well also acquisition is going to go on the themes list from earlier i wrote that down so here's a fun combination of things um savings accounts for kids investing in the stock market and uh agi and uh ubi corporations are going to get more profitable SPEAKER_24: they need fewer people ergo corporate profitability will rise and be very strong employment could get SPEAKER_25: hit people have also talked about giving every child a thousand dollars in the s p 500 when they're born to get them invested in the u.s economy to own a piece of the country if you will smush all that together and i wonder if you know some portion of corporate profitability that would go to taxes today ends up and i brought it up again um ends up being funneled in in that way towards people it's SPEAKER_38: maybe the dividends are basic or ubi or whatever yeah so this is um of all flavors of the same theme SPEAKER_36: and uh invest america is what brad gercer and some other folks are working on put a thousand ten thousand five thousand dollars in every kid's um savings account index funds and let them have access to it maybe twice in their life maybe once you know you can take out 25 percent of river college and then a second time maybe to put a down payment on a home for 25 percent of the other 50 percent you get in retirement and it would be like the super annotation funds in australia and then kids getting more savvy gen bet as we call them yes i started kids investment club.com uh and i i'm looking for somebody to i'm looking to incubate this as a startup so i need a co-founder or two who want to build this into a company i have the domain name i have the concept i've got a couple thousand people i think i've subscribed already to kids investment club.com my concept is to have young adults uh put money David Friedberg: into an account they make trades those trades are not real but then the parents have a shadow account in robin hood or another product so kids do the trades the parents if they want to can confirm those trades and make them on behalf of their kids kids get to make a model they say i want to do this parents get to execute it or not and if they don't the kids get to say look i said to buy nvidia you didn't do it you didn't push the trade through so almost like making your kids junior traders i think SPEAKER_16: this would be like a really noble thing if there's two or three uh folks out there who want to take this on and they can make a great app um i'm i'm here for it and i will fund it i'm gonna have SPEAKER_38: the domain name and i have the first thousand customers ready to go and people will pay for SPEAKER_28: this by the way i talked to parents they'd say they pay 100 bucks a month for a product like this SPEAKER_38: or 25 bucks a month for a product like this and i think it could change the world oh no jason i just SPEAKER_23: had a i just had a horrible a horrible impulse during that point you were you're like all funded and i SPEAKER_256: was like oh i'm in for i'm in for 10 i'm in for 15 and then i was like no bad alex journalism not SPEAKER_183: investing that's the first time you know no no conflict no interest you can you can absolutely and i'll cut you in on it oh no we're gonna get you conflicted i'm hanging out with you too much SPEAKER_16: we'll get you conflict no conflict no interest trust me we'll see you all next time bye bye bye