SPEAKER_00: the point of raising interest rates is that they want a certain number of people to lose their jobs it's crazy to say that out loud but that's the truth they want unemployment to go up and they want unemployment to go up so that the economy cools down and there's not so much money why would they want to do that because inflation is a worse in their mind in out of control

SPEAKER_02: inflation will do more damage and and that's really where we're at as an economy so nobody can predict this perfectly but i did predict it would be six quarters plus or minus two

SPEAKER_03: uh and here we are in seven and we're turning it around this week in startups is brought to you by

SPEAKER_04: masterclass learn from the world's best minds anytime anywhere and at your own pace get 15 off an annual membership to masterclass at masterclass.com slash startups masterworks is the first company allowing investors exposure into the blue chip artwork asset class twist listeners can skip the wait list by going to masterworks.com slash twist and coriant real wealth requires real solutions coriant provides wealth management services centered around you for more information speak with an advisor today at coriant.com hey everybody welcome to happy on it your boy jacal long

SPEAKER_07: time yes i know we stopped doing live uh because uh you know we had made a decision here at this week

SPEAKER_02: in startups when we stopped doing news with molly every day i wanted to get back to hey notice i wanted

SPEAKER_08: to get back to doing uh more interviews with all stars um two types of all stars people in the industry um you know like uh dharmesh from hubspot or ruloff from sequoia because y'all missed that right you miss those kind of old school and then uh i tried to do all the new founders coming out so we've been doing that we had all-star summer i don't know if you guys have seen scott from atlassian or dharmesh from hubspot ceo of mongo db nikesh from palo alto networks man do we get a lot of great folks

SPEAKER_02: and so what i've been thinking about you guys tell me what you think whenever a breaking news story happens in tech what i've been thinking about doing now that i know i have the passwords and everything to the youtube channel and zoom is so easy i don't even need to have my producers do this i can just turn on um live and then just talk about some breaking news story or take questions from you nikesh was dope yes and so let me just say hi to my notice adam you're first of course

SPEAKER_08: muhammad hi from london adam uh you're yes you're winning uh jeremy you're definitely noti uh branded noti for sure nick noti uh and who else is here tim hey what's up from virginia let me say hi to some other people uh shan tanu uh nikesh was dope i agree i don't know if there's a top news story

SPEAKER_09: y'all want me to give you a quick reaction to uh nick is there a top news story happening right now in

SPEAKER_12: the world yeah the splunk acquisition was pretty big today and i think your thoughts on the float for the three major ipos that we saw maybe you could go back into those notes that i think was a pretty

SPEAKER_13: interesting take that did not get too expanded on it all and we definitely touched it but not we

SPEAKER_15: didn't touched on it but we didn't go too crazy or the big insider trade quote alleged insider trade alleged insider trade made the best deal of all time or yeah you know yeah congrats to nancy pelosi was my

SPEAKER_10: joke yeah but isn't that the silliest like it can't really that can't be real because that would just be

SPEAKER_09: so it's so obvious yeah no of course it couldn't be um and you know anybody who is doing this kind

SPEAKER_08: of insider trading stuff is truly an idiot um because you will get caught i never understood how any person could ever do those trades because i think you know it's all tracked and you'll get

SPEAKER_07: reversed uh immediately but the big news of course today was cisco planning to acquire cyber security company splunk uh in cash for 157 per share that's a 31 uh premium on splunk's closing price puts the deal at 28 billion dollars i think this is a really interesting uh thing that's happening if you have large companies cisco is a very large company obviously um and smaller companies are going to be not priced at a premium people are looking for growth they have a lot of cash on the sidelines and you're going to see a lot more m a my email box is filled with founders with companies that have 500 000 to 20 million dollars in revenue and they're all considering because of the uh headwinds against raising money they're all considering hey maybe it's a good time for me to cash in my chips now of course in a town market you want to build not sell your company and great companies are bought not sold in other words once you tell people you're looking to sell your company they assume there's

SPEAKER_08: something wrong with it and so uh i think m a activity is going to be really really um el fuego in

SPEAKER_07: the next year but we also had three companies go public and that is a very interesting moment in time these companies are in a lot of ways being forced to go public because uh they've been around for over 10 years we saw three of them in the last week you had arm and masayoshi-san had no choice but to get

SPEAKER_08: that company public because he needed to get distributions to people like um you know the the

SPEAKER_07: the lps who are in the vision fund so arm went out i think they priced their shares at 51 they raised close to 5 billion 50 plus million uh billion dollar valuation it jumped 30 percent came back down to earth so i guess in some ways they priced it well klaviyo they priced at 30 a share they raised a half billion dollars they've got a nine billion dollar valuation that's a great company uh they're doing uh something like 600 million plus a year 51 year over year growth they've got a bunch of free cash flow and and just you know profitable great company klaviyo uh has a large percentage of shopify stores using them if you

SPEAKER_08: don't know what klaviyo does they study all the data of your customers and they send them customized communication so if you love a particular brand of clothes or you know you're you're um and you're

SPEAKER_07: getting customized marketing from them where they know oh hey this is your gender you like to buy jeans and t-shirts from us but you don't care about jackets and shirts they're going to just update you intelligently and so it's a really really great business with a lot of lock-in so once you install klaviyo

SPEAKER_02: it's a it's it's you know it's not super expensive and it's going to increase how much uh conversion you have those kind of tools even in a down market they become more valuable because each

SPEAKER_00: person is saying hey if customers are going to spend less let's try to get you know the the the fat cats in our system to just spend a little more let people are just really focused on revenue

SPEAKER_25: because they don't have the ability to raise money we all have self-doubt i can promise you if there's a hundred people in a room a hundred people have some level of insecurity you can't have any self-doubt about your commitment and conviction to do this you might have self-doubt about your ability to succeed to raise the money to attract the right people those are two different issues

SPEAKER_27: that voice you just heard is one of my personal heroes oh my lord starbucks ceo howard schultz i'd love

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SPEAKER_02: now instacart that's a really interesting one we're an instacart family we use instacart

SPEAKER_07: we use ubereats and we use doordash we use all three of them we use them kind of in different modalities um i like uber eats when i need something quickly you know you need a gallon of milk you need some eggs you need some cheese hot dogs whatever you're cooking that night ice cream it comes so much faster than instacart but when you want a big order instacart works pretty well uh and so we've just been in the habit of using instacart problem is they're not growing that much revenues up 15 year over year their ad revenues up 20 year over year but it seems like they don't make any money off groceries groceries are the worst business you could ever be in and so i think you know the the the the real red flag on

SPEAKER_08: that business is that the gross transaction volume is flat the ad revenue is growing does that sound

SPEAKER_07: familiar you know basically what that means is over time ad revenue is going to account for a larger percentage of their total revenue they're doing 800 million in ad revenue a year that's uh not insignificant i think uber passed a billion obviously amazon has tens of billions so what we're seeing is consumer packaged goods are a major advertising category that money is spent on tv would you rather if you were trying to sell uh you know coke zero if you're trying to sell your coke zero where would you like to spend money on the super bowl on an nba game during some tv show on youtube or would you rather spend it when i am checking out with my cart and say hey would you like a case of coke zero oh we have coke zero uh you know cherry coke zero we have vanilla coke zero doing that kind of advertising that's connected to your shopping cart is so much more powerful and so i think instacart is going to be very similar to amazon there's multiple ways you can advertise on amazon you know this because when you do a search and the top row is sponsored and then you're trying to find the first organic row it's incredibly frustrating as a user but sometimes the advertisers are actually the best products and so you'll see the amazon choice and the sponsor just like when you do a google search sometimes people will buy the ad for their own name like volvo will buy the ad for volvo and then you'll have the volvo organic search result if you can get closer to

SPEAKER_02: the transaction that's a much more powerful and trackable uh ad so i think instacart's business

SPEAKER_07: should be to try to make no money make zero dollars on sales and then really just go after amazon try to get as much share of cart as possible so then instead of people doing the end cap at a store or uh doing the super bowl ads or tv ads yeah just that little ad that pops up at the end when you're checking out that's when it says hey do you want to add these three items that's an ad people don't know it's an ad they think it's just part of instagram that's an ad and when you first open the app you'll see offers and so i have been with ice cream on uber eats it seems like the cpg

SPEAKER_02: brands are offering buy one get one free ice cream and so you know my girls like to eat ice cream when

SPEAKER_07: watching tv we have a little ice cream uh it's a little tradition in our household when i saw two for one

SPEAKER_02: i just was like okay i'm gonna buy eight pints of ice cream i was gonna buy four anyway but i'll buy the ones that are you know buy one get one free those ads are not the stores to the best of my

SPEAKER_00: knowledge and that's not uber eats or instacart trying to get you to spend more money those are the

SPEAKER_02: cpg brands trying to move more product but then how do you value instacart here's how i'd value it

SPEAKER_07: 25 times let's say they make a third of the ad revenue is profit uh so if they make a billion

SPEAKER_02: dollars that's 350 million in profits 20 times that 30 times that is how you would value in an ad business in other words 20 or 30 times earnings if you look at google stock price it's 25 30 times uh their earnings i think facebook is 30 35 times their earnings that's called the price earnings

SPEAKER_07: ratio as you know my guess is that right now instacart has let's call it i'm going to round them up to a bill let's call it two 300 million in profits let's make let's be generous make it 300 million 300 million uh times 25 percent uh or times 25 right uh you know you're starting to get to that six seven eight or you know 30 times earnings 25 times earning 20 times earning 20 times that would be 6 billion 30 times 300 million be 9 billion you know what they're trading i think they're trading at like exactly 8 billion i think that's how the market is um valuing them if you want to compare their 800 million to amazon amazon's got 40 billion so there it is i think that's a really great way for you to

SPEAKER_50: look at that business so big week for ipos what does that mean for the startup market it means

SPEAKER_07: that the people who are the lps in khosla y combinator sequoia and drees and horowitz those are the big beneficiaries they did the early rounds this you know the seed series a and b of instacart those folks are sending money to lps who are the lps it could be someone like ford foundation it could be somebody like harvard it could be someone like calpers it could be high net worth individuals it could be a sovereign wealth fund like ubatala anyway those people are getting money back when lps get money back then they feel confident enough to put more money to work in venture and thus the cycle begins again but right now limited partners haven't gotten a lot of money back because it's been a two year drought of ipos all of a sudden three ipos in a week if you were in the vision fund and you were kind of bummed out getting you know billions of dollars uh from masayoshi-san for arm feels good you know if you're a khosla or y combinator or sequoia andreessen horowitz lp hey getting some instacart shares feels pretty darn good getting klaviyo shares feels pretty good and that builds the confidence that silicon valley and the tech industry and venture capital and accelerators and angel investors can actually identify companies that scale and change the world now i would add to

SPEAKER_13: jason vision fund lp's got an extra extra nice gift because softbank the entity the main company acquired 25 of arm from its own vision fund at a 64 billion valuation so higher than what it went out

SPEAKER_46: at um last month yeah so they got to doubt they got to double deb it's a really good point so yeah

SPEAKER_12: basically paying vision fund lps with shareholder dollars which is great listen here's what's

SPEAKER_07: happening it's such a really good point is everybody who's in the capital allocation game wants to get more of their lps money so that people uh you know um trust the ecosystem more and when things crash you know trust and concern you know people don't feel good about certain stocks they don't feel good about the stock market they don't feel good about venture and that's what happens when a market bottoms out and that trickles down all the way to startup so that's what's happening okay so do you have any

SPEAKER_12: thoughts on the uh the dave portnoy calling the washington post journalists yesterday yeah you know

SPEAKER_07: that's interesting you sent me that nick and um it really felt scummy that the washington post were targeting the advertisers first and saying you know um that dave portnoy is problematic it felt like they were doing that to damage dave portnoy and damage barstool sports and to get those sponsors to cancel their sponsor agreements for his pizza festival and then they want to go to him and get a comment at the last minute that's kind of dirty uh if and i think that there's probably a very strong internal discussion going on at the washington post about hey our job is to you know uh when we have a story like this um maybe start with the person who is in question and you say hey dave um these things uh people felt were misogynistic or you know you use these terms uh you know 12 years ago and uh you know maybe those

SPEAKER_02: things are not politically correct right now you have to ask yourself like why is this story important to the washington post right now that's what i felt like really weird and the way they're doing it seems like they were using a tactic to damage barstool sports now i don't think they're direct competitors but it felt like vindictive virtue signaling woke whatever and you have to ask yourself like okay if there was a star you know dave portnoy is an actor basically right he's a persona if you had an actor from 10 years ago or 20 years ago and in a show they used a term that was not politically

SPEAKER_65: correct or acceptable today and you know society's changed over 10 or 20 years so i'm just sort of taking

SPEAKER_02: dave portnoy out of it and then that person is uh you know in a commercial for t-mobile or that person you know did a skit or a comedy bit on a talk show whatever and hey that's not politically correct now and then they go do a movie and you try to get them canceled on disney it just felt i think to people

SPEAKER_08: like the woman was gleefully trying to set up a situation uh where they were trying to damage the business and uh you heard de portnoy use the term tortious a tort tortious interference and what that

SPEAKER_07: is is a fancy word for you're trying to damage my business you're trying to interfere with my ability to do business so i think the lawyers at washington post when they hear that discussion going on they're like oh this does feel like maybe we're not playing it straight and this is why media has lost credibility is because it feels like they're trying to take people out as opposed to inform the public

SPEAKER_13: i don't know if that's the case with this writer i don't know if it's just sloppy reporting you want to play the clip where she specifically says the tactic that she uses she kind of says the quiet

SPEAKER_72: part out loud yeah so this is where it kind of breaks down it was like all the way at the end she

SPEAKER_07: was talking about the tactics of journalists and that is to your point nick saying the quiet part out

SPEAKER_02: loud which is journalists do have tactics and one of the tactics is to try to bait people to taunt people

SPEAKER_07: to get them to talk and then at the last minute try to get a no comment from somebody and so we'll just play the this like a minute i think it's like nine minutes or something go ahead it's nine minutes and

SPEAKER_13: 20 something seconds but everybody listen closely because he's obviously using a cell phone up to a microphone so she's much lower than he is okay say i have not made my mind up about you then why

SPEAKER_79: would you include that in the in the email to sponsors because i was hoping for a dialogue with

SPEAKER_80: them you know sometimes you have to say something like this is like you know it's sort of a reporting

SPEAKER_82: tactic when you want someone to respond you kind of have to indicate that there might be something negative and then you get them to engage that's all i was trying to do i really wanted them to engage

SPEAKER_84: with me that is a bad state of journalism if that's a tactic that you have to what i would say is make

SPEAKER_80: up something about somebody there might be something there might be something negative and so you want to give people a chance to respond yeah you can see by dave's reaction it's like she doesn't know if

SPEAKER_02: it's true the negative stuff and she's trying to bait some sponsor into responding really dirty tactics uh washington post needs to talk to that journalist i don't know which journalist is they they might be

SPEAKER_07: pulling surprise winning but the fact that he said that out loud you know kind of confirms what a lot of people suspect which is the thumb is on the scale and it just doesn't feel good i don't think these

SPEAKER_02: journalists understand that we don't want to feel manipulated and that's like one of the themes of the past i don't know decade is whether whatever organization is we don't want to feel manipulated by

SPEAKER_00: the government by a health organization by the fed you know or by media just tell us the truth that's

SPEAKER_02: what we want just tell us the truth and if we want opinion we'll watch an opinion show but you know the washington post is supposed to be really really you know great journalism and i think this is a tactic

SPEAKER_07: that you might expect that like you know the news of the world or some rupert murdoch uh you know

SPEAKER_00: gossip publication not the washington post and you know it's the same thing with the new york times very

SPEAKER_07: similar tactics um where you feel like they're really trying to destroy somebody as opposed to just inform the public and so it's it's it's sad for me as a journalist there's two factors that are contributing to this one there's a generation of journalists who think it's their mission to do advocacy right like they have to be advocates and they have to try to get an outcome as opposed to just informing people and the second piece is they've had their business destroyed by competitors online

SPEAKER_08: competitors whether it's google facebook we're just talking about instacart and their advertising business all of that advertising uh also craigslist facebook marketplace that took the classifies in the advertising business away from the publications and so the fact that they've had

SPEAKER_47: their advertising crushed is is a big part of the story here too i believe listen public markets can

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SPEAKER_07: at masterworks.com cd i'll take a couple questions from uh folks in the chat room let me take a look here

SPEAKER_08: at the questions from jd do vcs ever go back to previous business trends or does everyone focus

SPEAKER_07: exclusively on the it thing like ai today great question what you would do is um you would take the new platform change and then you apply it to everything that came before it okay that's an example

SPEAKER_08: of that um crm systems uh customer relationship management salesforce salesforce did that in the

SPEAKER_07: cloud before that we had software that you know you would uh client server software you would install a server and you'd have all that in a database then uh you know mobile comes out and so somebody makes a mobile experience so you have superhuman on mobile is you know better than gmail or gmail replaced you know eudora a client that you would buy and so with ai i think ai is an opportunity to look at every existing business and i had this discussion with the ceo of kayak recently you'll get that episode soon and when i had the ceo of kayak on i was asking him like hey what do you think about ai and he wasn't particularly enamored by it right now um and i thought hmm i don't know if i agree with that i think really the you know ai is going to change how we book flights restaurants etc i think you're just going to talk to and say hey what are i'm going to new york uh what are five restaurants i'd really like based on you know um the things i favorited in yelp and and places i've been to before oh we know you like sushi we know you like burgers we know you like ethnic food here's you know a great uh ethiopian place to get your ethnic food here's a great burger joint and here's the best sushi place and then it tells you the times that they're available and you say yeah looks good you know book one for monday one for tuesday one for wednesday at seven o'clock it looks at my google calendar it knows oh i have a late meeting so that night i want dinner at eight

SPEAKER_00: and it just does it for you and so that's how you should think about it is what existing businesses can you disrupt with this new technology whether it's mobile whether it's cloud whether it's ai great question or you know google uh the the apple goggles that are coming the the what they

SPEAKER_65: call vision pro whatever that's going to change things too uh so we'll see how to start outside

SPEAKER_08: silicon valley access vc funding or do you just have to make the journey there uh there are vcs in new york there are vcs in miami but i do think if you're a first-time founder you will get a lot more attention i would say probably 50 times the number of meetings if you just move here and place your company in the peninsula you know in in whether you're in san carlos san francisco

SPEAKER_07: san jose you place your company there and then you can just go have coffee with uh these vcs or come to their office and people are starting to be in offices again so i would say you get 50 times the number of meetings and it's a numbers game now if you are a breakout company in salt lake city or austin vcs will fly to you so that's the nature of it if you have a great company that's growing 3x year over year you're going to get funded if you're in boise idaho you know like shopify they were in ottawa i think originally so it doesn't matter where you are if you're in the top one percent of startups

SPEAKER_08: if you're not in the top one percent of startups you have a massive competitive advantage being here i heard you say this is beer script i heard you say you believe we still have six months of this down market what makes you arrive at that prediction how do you think the transition will go hockey slow

SPEAKER_07: i've said from the beginning because i looked at the three um i looked at the two previous down markets i lived through dot com and great recession these things tend to last six quarters plus or minus two so the shortest they'll be is three or four quarters the longest they'll be is like maybe nine uh six seven eight nine quarters you know uh two years so somewhere between you know half a year and two years is the is the the historical norm and what we've seen uh we're six we've we've got six quarters behind us uh and i almost finished the seventh quarter of down market chaos and it feels

SPEAKER_00: like green shoots right we've had three ipos in the past week we've got m a happening uh we have companies that cut off and laid off a bunch of people now saying oh maybe i'm gonna bring somebody back and that's what you had happen with uh salesforce just said they're hiring people back and they may

SPEAKER_07: have some boomerang employees i as long as consumers are strong and we have the lowest unemployment of our lifetime then they'll have money if they have money they have confidence if they have confidence then they spend money and we're a consumer-driven economy and businesses if they see consumers continue to spend money and there's competition for employees they're going to compete but the reason i think things are soft and might be changing is because i have a number of job descriptions out because my two

SPEAKER_41: businesses launch and inside are doing so well and then i also uh you know have some domestic positions

SPEAKER_58: you know like nannies and stuff like that i have seen a dramatic uh change in the number of qualified

SPEAKER_07: people applying for jobs and then you know some people will apply for a job on linkedin then they'll write me a personal email if they can back into its launch and then they go find the ceo and then i also have people email me and say hey i'll work for you for free for three months prove myself etc i'm starting to get those i won't call them desperate emails but i'll call them you know i really need a job emails and you know i've been there myself and they're all other part of my career you know needed a job once or twice and i'm seeing a lot of that so i think the labor economy is uh uh softening and then that means you know if there aren't as many consumers going crazy after three yolo summers they probably won't spend as much money will they they don't spend as much money then inflation should go down because people are going to lower the prices of cars like tesla's doing they're going to

SPEAKER_08: lower the price of hotel rooms and flights and this idea that like it's hard to get a flight hard to get a hotel room hard to find a car which you know it has been for the last couple of years

SPEAKER_00: well that's going away that's kind of healthy that's the slow down that's the point of raising interest rates the point of raising interest rates is that they want a certain number of people to lose their jobs it's crazy to say that out loud but that's the truth they want unemployment to go up they want unemployment to go up so that the economy cools down and there's not so much money why would they want to do that because inflation is a worse in their mind in out of control inflation

SPEAKER_02: will do more damage and and that's really where we're at as an economy so nobody can predict this perfectly but i did predict it would be six quarters plus or minus two uh and here we are in seven and

SPEAKER_00: we're turning it around what that means for startups you got to get to break even have a path to break even uh you got to have uh a lot of options available to you if your startup is losing you know a hundred thousand a million dollars a month you're not going to get funded unless the

SPEAKER_65: growth is amazing and you know it's it's hard to grow right now because you know it's a tough market

SPEAKER_123: zach asks since you invest in so many companies each year how do you find alpha and separate these

SPEAKER_08: startups from each other great question we have a database we have 20 000 applications a year we meet

SPEAKER_07: with 3 000 companies a year we have 19 full-time people at the company i'm hiring three more researchers analysts i hire researchers and analysts kind of out of school i think we the starting salaries are like 60 and 70k so it's not a super job but it's not a terrible job and then we ask them to do 500 meetings per year that's 10 meetings a week minimum some people do 15 that's three meetings a day writing coverage of every startup then we we write a lot of small checks so we have 25k checks

SPEAKER_40: we give to found university companies we have 100k checks we give to launch accelerator companies

SPEAKER_07: 100 million people listen to my podcasts uh between all in and the speaking startups then you have 20 000 applications and 3 000 meetings the when the meetings have certain characteristics and i have 12 characteristics i like uh in startups like builder founders product velocity a growth rate above two act there's uh i love world-class design i like certain markets that are high gross uh margin if a startup has three of the 12 uh characteristics i'm looking for the team will take a second meeting other people will look at it and then we have two investment team meetings a year and then people will tell me hey we should make this investment and then we as a group decide if it's a follow-on investment we invest in the top 10 of our portfolio so it's a competition if the top 10 of our portfolio is growing 3x and above and yours is growing 2x you just might not make the cut why we'll have a certain amount of dry powder as an investor i need to put it into the highest performers i have access to and so that's an important thing for people to realize and our ownership percentage in winning companies we'd like to own 10 to 15 percent of the best companies in our portfolio when i was a angel we owned under one percent of robin hood and uber but then we started to own two percent five percent ten percent of companies like com or superhuman or grin or fitbod and so when we saw companies start to get to tens of millions in revenue we really started to build that position and so you want to make a lot of bets

SPEAKER_08: and then study them through their monthly updates and just looking at the statistics being board members

SPEAKER_07: board observers and then you plow the you plow basically a third to half of your fund if you had a hundred million dollar fund which is what we're raising now you want to put maybe 50 million of that fund into the highest performers 50 million into the first bets so it is a competition and and

SPEAKER_47: that's how you do what's called portfolio management great questions our friends at coriant provide

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SPEAKER_41: next i know that we got a lot of questions coming in here um there's a good question about why you're

SPEAKER_44: doing the cloud kitchen incubator that i think would be great yeah so uh why don't you pull up the landing page

SPEAKER_07: uh so uh my friend travis obviously uh is doing cloud kitchen he had done uber i'm involved with

SPEAKER_08: the company and we think there's an opportunity to support food entrepreneurs people want to build a brand so what we're doing is we have a very small fund i would call it a micro fund i'd call this an experiment

SPEAKER_07: and we have this curriculum from founder university the founder university curriculum teaches software companies marketplaces fintech companies etc how to grow a business really fast now there's that opportunity inside of cloud kitchens how does a cloud kitchen work let's say you have an amazing product like there's this thing called milk bread uh which i had this incredible french toast when i was in tokyo and so nick if you do a search for milk bread los angeles you'll see like it's a bit of a phenomenon in la and there's somebody who's got a cloud kitchen that does this milk bread here it is and so they um have this plush loaf of japanese bread it's it's done in a ghost kitchen cloud kitchen is the name of travis's company and diego's company uh ghost kitchen is what people call it but what is that to just level set with people imagine you had a warehouse at the intersection of the 405 and the 10 or you know the the 380 and the 101 if you know that interchange in san mateo or san francisco where the drivers could pick something up and then get to a large number of people very quickly um and that was cheap real estate and then in it you build little you know eight by eight ten by ten kitchens and then instead of you having to go find a kitchen as somebody who's making this milk bread or let's say you want to make a katsu sandwich place or a salad place or a boba place instead of getting a storefront for ten thousand dollars twenty thousand dollars and having to outfit it what if you could for thirty five hundred or forty five hundred a month be in this location

SPEAKER_50: where the drivers are sitting outside and then when you finish making an order you just take it and you hand it to somebody at the front desk and they take it from there now you've eliminated like a third

SPEAKER_07: of the work you know on a daily basis and then you've eliminated long-term leases and um building out kitchens putting in a stove etc and then cloud kitchens also has software so what if we gave fifty thousand dollars to people to start one of these so imagine you're a chef you work at a restaurant you work in the appetizer place and you just think you know i don't want to work here anymore i want to be my own boss i make 50 grand a year working at this place well we give you 50 grand

SPEAKER_08: and you take the year and then you go build this cloud kitchen and i think we're going to give people a couple of months of free rent in a cloud kitchen uh we're just meeting with folks now um this cloud kitchen's effort we might build the next great american food brand you know whether that's a

SPEAKER_07: donut shop like crispy cream whether it's you know sweet greens for salad or uh what's the starboard chicken that we used to get at the office or belcampo burgers i think we have an opportunity to build

SPEAKER_08: some of those businesses so it's a little bit of an experiment we'll probably do two cohorts of seven 14 companies and see how it goes um so i like to experiment i like to work with my friends and here i think we might be able to build some really huge uh lasting businesses uh let's see from darian do you believe that there should be guard rails on ai or should there be as little regulation as possible to help spur innovation it's a great question i don't have an exact answer i do think that open source is a really great way to mitigate this so that we can see what it's doing i think uh people explaining what the ai is doing is a good idea and um you know we have an

SPEAKER_07: existing set of laws that uh exist around intellectual property uh and crimes and i think you know in talking to nikesh from palo alto networks i think that podcast is out already you know he was talking

SPEAKER_08: about these sophisticated actors are using ai already so we're going to need ai to combat ai so you know now agi like the general intelligence concept where it just can think for itself you start plugging that into robots and there are general robots you look at those boston dynamic videos yeah that would be pretty scary if uh somebody created or got one of those robots and then just told it its mission is to kill as many humans as possible now you think that's crazy but terrorists blew up the world trade center there are evil people in the world and evil people luckily are generally stupid and not capable

SPEAKER_07: and then once in a while like al-qaeda uh and they become super hyper capable and they and they come up with really clever ways to do evil things in the world and that's the big fear so i think it's valid um i don't think we're at the point where we need to stop ai development i think we need to be thoughtful about it and i really like the fact that elon talked to schumer and um i think elon was the driver of

SPEAKER_65: that meeting that we saw last week so or yeah it was two weeks ago etc so i i think being thoughtful

SPEAKER_08: and having these conversations early and often is going to be good there's also um employment displacement that's going to happen and so i think preparing everybody for that is wise i just had the ceo of kayak we did an interview he said he's not hiring anybody because his developers that are junior

SPEAKER_00: are becoming senior so quickly with co-pilots and the senior people are becoming 10x developers so everybody's getting so good that professional development is better than anything else they

SPEAKER_08: could be doing bob g the og says which areas do you recommend founders to cut burn that impacts growth the least yeah great question i think people spend a lot of money on marketing and that is something that founders can learn to do themselves and they don't need to have a huge marketing department um i think outsourcing as much as possible whether that's your servers your hr your accounting can really control costs and i think hiring people at you know reasonable salaries is also the way to do

SPEAKER_07: it as an example i was talking before about researchers and analysts we hire a decent number of people in canada and then my other company inside hires a lot of writers in canada why they're just as good as americans they stay at companies twice as long and there's a 25 difference in the currency so you know we get arguably people to stay twice as long and we save a minimum of 25

SPEAKER_08: on salaries which means you get an extra person you know uh for every three or four people that you hire so be thoughtful uh if you're going to have a remote team you know you could get some of those gains uh and then you just have to have real hardcore startup employees so if you have people who are phoning it in uh and they want huge raises you're going to just have to be more cutthroat and just say no to raises uh until you get to profitability and i have a slack room where every

SPEAKER_07: single bill comes into and i just go into that slack room once a week i see all the bills coming in i standardized everybody on the same credit cards and the same bank stuff so it just gets piped into

SPEAKER_08: there i think we zapier to do it and if i see something that i don't recognize i just ask what's that is it essential if it's not essential let's get rid of it so essentialism is great sos asks when

SPEAKER_44: should i found sorry we got a super chat question for five dollars i think you should answer oh really

SPEAKER_08: oh i that's completely unnecessary um but okay uh super chat question hamza thank you for the five bucks i don't know what i'm going to do with it but okay great interest is forbidden in islam but i really want to invest or create an investment group for startups without interest this is possible jason okay that's something i was aware of that interest is um religiously not tenable uh so but startups when

SPEAKER_07: you do a note has an interest rate on a safe it does not so i think you would be safe with a safe because it doesn't have an interest rate and on a convertible note you do have it so i think the way to do that would be to waive your interest or to donate that interest to a cause for islam and then it would not be uh if we're looking at the spirit of the religious law it would not be um interest it

SPEAKER_08: would be a donation and you would be in the clear but you have to talk to your iman i guess and have a thoughtful discussion about that you know some people are how they interpret things is very

SPEAKER_07: literal and some people interpret things in the spirit of the law so great question and i will take questions first from people who do super chats yes although i don't want people i don't think i want

SPEAKER_65: people doing super chats because but whatever i do super chats all the time for nick's fan tv but i'm

SPEAKER_08: a super fan of the host and i want him to keep doing it but i will take super chats first because that seems most fair from bob g how do you advise founders to solve disagreements internally it's a good thing for investors and board members to do i think division of labor is very important who's in charge of what having one ceo who ultimately makes the decision emotional maturity and self-awareness is important i think having the discussion hey you believe x i believe y let's still manage each other's positions and let's you know uh argue each other's side and then uh place a bet and so any duke's book uh thinking of bets good book a great thinker um you could say i am 80 convinced that we should be a business to business company 20 i think we should be a consumer company and then your co-founder might say well

SPEAKER_07: i'm 50 50. so okay let's spend the first year being an enterprise company if we hit these specific notes then we'll keep going if we don't and we don't get traction then we'll switch to my idea and then you just codify that and write that down and so you make it more of a um a bet and you're honest

SPEAKER_08: about it and then you can go back and if you've documented it have a really thoughtful conversation about who was right and why and what was your thinking here's a question uh board members if you have a disagreement go to your board members and try to de-escalate it try to get down to understanding and having empathy for the other person's position and then make a quick decision be willing to reverse it from tovade hey jason thanks for doing this my question is what is a book that you've read recently that you would highly recommend could be any type of book okay great question uh unreasonable hospitality is a book about 11 madison park i highly recommend it that's it go take a look at it uh do you think the uk underperforming when it comes to unicorns and big impact on startups so why uk is a smaller country you know if you if you got a fraction of the number of people as america india china you will have a fraction of the number of unicorns also um you know there's different societies view entrepreneurs differently america we've typically celebrated them um and for a period china was celebrating them now they're not so it really is up to society to

SPEAKER_47: decide if they want to celebrate entrepreneurship and innovation or if they want to vilify it this is one of my main concerns about america right now is that we're vilifying people and it's really crazy

SPEAKER_162: uh okay i think that's enough questions for now i didn't think i missed any it's nice to get 100

SPEAKER_08: people to pop in and say hi and if i do it more often more people will come so if you did see this give a thumbs up and then where the subscribe button is i'm sure you're subscribed to this you can hit all and you'll get a notification when i go live and so maybe we'll do some more now that i know how to do it i just pop up zoom and then i just hit that button nick and i'm good and i don't ever have to talk to you or anybody i can just do it when i want i think i want to go rogue you know

SPEAKER_41: that's the thing i saw with what um uh my friend um you know at nick's fan tv does cp the franchise and he's built up quite an audience he gets like a thousand people every time he goes live and listen

SPEAKER_47: i get like whatever's 127 watching now i think at the peak we were getting what 400 yeah four to five

SPEAKER_12: and then if it was something important it would be like 800 to a thousand range live pretty crazy it was like apple or uh the day that elon bought twitter i remember we went live that was crazy we had a lot of people in that one great awesome okay i'll start doing that all right everybody i will see

SPEAKER_08: you next time i'm gonna go watch ashoka with my daughters and make them dinner love y'all peace