Jason Calacanis: all right everybody it's tuesday we're climbing the hill and we have a spectacular show for you

SPEAKER_01: spectacular never gets old oh yes well we start with the spac of nicola the failed uh alternative

SPEAKER_04: energy vehicle company they're on trial in new york uh trevor milton the founder who was on this very podcast and a clip from our podcast was played reportedly at the trial today so i'm going

SPEAKER_05: to comment on that and then we'll get into other specs going on yeah it's good stuff we're gonna

Jason Calacanis: we'll talk about chamath winding down two of his specs and returning the money to investors a little bit on the mechanics of specs i think for because a lot of people are not familiar with why a spec might get wound down at all and then we'll break down the business of rumble the right wing slash

SPEAKER_11: free speech neutral youtube depending on how you're pitching it and most importantly i will make a jay trade that's right it's been a little quiet on the jay trading front but i'm making a bet

SPEAKER_12: big bet uh based on some mna activity in the market it's going to be a great show stick with us

SPEAKER_15: this week in startups is brought to you by vanta compliance and security shouldn't be a deal breaker for startups to win new business vanta makes it easy for companies to get a sock to report fast twist listeners can get one thousand dollars off for a limited time at vanta.com twist squarespace turn your idea into a new website go to squarespace.com for a free trial and when you're ready to launch use offer code twist to save 10 off your first purchase of a website or domain and revelo looking to affordably scale your product development with global tech talent in u.s time zones hire vetted remote developers in latin america with revelo get 20 off for the first three months at revelo.com twist

David Friedberg: all right everybody it's tuesday there's a lot going on and my twitter's blowing up i guess trevor milton i didn't realize it the founder ceo of nicola who was on this very program

SPEAKER_21: not too long ago he is on trial right now in new york uh-huh so let's give a little background here

SPEAKER_07: we're talking about of course the company nicola which went public via spac it was like meant to be the you know savior of electric vehicles it had a two billion dollar investment from general motors and they were going to develop an electric pickup truck um and that all let's just say went wrong a research firm like i almost thought that they had made this up when i read it a research firm named

Jason Calacanis: hindenburg hindenburg real firm true story legit accused the company of massive fraud saying that nicola vastly overstated the capabilities of its technology and vehicles claims its partners didn't do their homework uh the stock went down uh 18 as of the time as of i think early september i would

SPEAKER_26: imagine it's maybe a little worse now nicola i think founder and chairman trevor milton had already like stepped down as ceo but was still the executive chairman and so yeah i mean there was a whole process

SPEAKER_05: of him exiting but um you know when he was on this program uh i kind of knew this was sketchy

SPEAKER_01: and i knew there wasn't a lot there and it was pretty obvious that the company ran up to 30 40

SPEAKER_04: billion that it was not worth that now i've been very critical of all these companies becoming worth billions of dollars before they have a product in market that's jason's law company becomes worth more than a billion dollars before it has a product in market it could be a fraud a scam it's probably gonna fail right and we have a long list of companies like that right and this is the one where

SPEAKER_07: they had that like semi-truck prototype that just was not actually even real right it was like down a hill they pushed it down a hill right okay yes this is the one so now you're all caught up on the history of nicola sort of because it's still being written i mean this is a theranos level fraud

SPEAKER_04: it seems based on my you know and i sort of said this but you know people were really sweating the interview like hey why did you platform the guy and i was like well i kind of let him talk

SPEAKER_36: and i asked him some very targeted questions strategically so my interview technique here

SPEAKER_04: if you want to see that interview it was episode 1090 just type in this weekend startups trevor milton you'll find it and then i did emergency podcast when the sec filed his stuff but there was a moment when i was like not a lot of this adds up and i had asked him hey why are you doing the badger or something was like their consumer product now they had this idea and i'll throw this clip in a second molly but their business idea was they were going to sell like hydrogen based trucks and a hydrogen based system per mile to and maybe have self-driving at some point anyway they were going to sell this to you know anheuser-busch or whoever had to ship a bunch of stuff but their innovation was you don't even have to buy the trucks we'll just sell them to you on a per mile basis so this sounds like i don't know maybe business model innovation as a service boom boom boom yeah yeah very well done yeah yes so you know you you then have to think just from first principles well has this person ever built anything in the world what have they built and he kept it trying to explain how their technology was better so i just kept asking very basic questions well why doesn't this exist already and you know how do you do it cheaper and i just let him talk but then they had

David Friedberg: released this badge and they started taking five thousand dollar deposits for and i was like well if you're doing hydrogen consumer consumer i said if you're doing all this b2b why would you start a consumer practice at the same time and then that's electric or hydrogen like why would you do electric

SPEAKER_32: i don't understand why you would do this now i had warmed up i had warmed him up a bit now i'm not trying to set up anybody on this podcast but in this case you know i do want people to talk and get their point across and if the person is a fraud as he allegedly is and i believe him to be as seems like

SPEAKER_44: the likely likely scenario my gut my radar molly if you will why would you launch another product and so

SPEAKER_32: you know my interview technique is just let him talk for anybody here i want to let them explain you do interviews you want to let people explain their vision and ask them a probing question so

SPEAKER_49: here's the probing question i asked him so now you've got all this cash uh on the balance sheet and you've got all this runway but you this building a network of hydrogen chargers and coordinating the building of hydrogen trucks and satisfying a bunch of customers seems like an awful lot of work and then i'm not sure exactly the date you announced it what date did you announce that you're going to take on ford's f-150 pickup truck and elon cybertruck and the rivan rivan is uh the other rivian sorry rivian so now you decide f it i'm going to create an f-150 the best-selling car uh in the united states i think and obviously best-selling truck why would you take on more work that's a good question yeah so

SPEAKER_53: here's the reason why our trucks are a gravy train with money um that's where all the money comes from is our is our big semi trucks right the problem is is 90 of americans will never own a semi truck and so your investment port your invest your portfolio of investors can be very limited and we wanted to go and build a company that's gonna be worth 500 billion trillion dollars over say 10 or 10 or 15 years and if you're limiting yourself to 10 of the market you'll never do it no matter how good your numbers are the reason why people love apple that everyone touches their product why do they love google everyone touches their product so it you're what i did is i knew day one you know once once we started coming out we had all this gravy train coming in from the semi truck program my my question was okay that's great but i'll never touch the average consumer so therefore 90 of investors will probably never invest in me so i needed to touch the consumer and so that the truck is for the profit the semi truck the pickup trucks for the consumer and the consumer is the one who is part of the robin hood portfolio is part of the the you know the family office or whatever and that's

SPEAKER_07: where all the the valuation of the company comes from my like literally my jaw dropped when he said gravy train of money yeah i mean so so much there's so much to break down here i think there was

SPEAKER_57: no recorded revenue they have no revenue so to refer to it as a gravy train is crazy gravy train yeah

SPEAKER_44: potential of money printing machine would be you know it just a very delicate just a very basic

David Friedberg: qualifier there potentially we hope will be a gravy train we intend to you know our intention is to make that but this idea of touching the consumer yeah explain this like retail investor thing because

SPEAKER_65: that seems to have piqued a lot of interest this this like this is the clip suppose that they played

SPEAKER_68: hood folks involved this morning in court yeah because this would lend itself to saying he

David Friedberg: intentionally created a product to manipulate retail investors into investing in the company would be i guess the most cynical way to look at that he was literally trying to court day traders like robin

SPEAKER_26: hood is a proxy for retail investors right yeah yeah exactly like lure them get them interested in buying literally making it a meme stock i mean he says it he doesn't think it he says it yeah this is

SPEAKER_11: not like he said it in a meeting like you know hey and there's a little bonus here molly tumbled

SPEAKER_01: right out if we had a consumer product you know like consumer retail might be in and i i'm listening to this and i'm trying to parse it and this was kind of there were moments in this where i was like this guy's a real idiot i mean this guy is a dope i that's literally what came to my mind was like

SPEAKER_75: this guy seems kind of dopey to me it reminds me of our cryptocurrency conversations with sunny and

SPEAKER_26: vinnie and how we keep talking about how when you're financializing a product before you have product market fit you're ahead of yourself you have a problem what he is describing to you right there is how he's trying to financialize his business like i'm trying to offer a portfolio to investors in

SPEAKER_07: order to get me the capital that i need to actually build my gravy train that does not yet exist and is

SPEAKER_04: producing no gravy i literally felt like at that moment i was joe pesci in my cousin vinnie you know when he's got somebody on the stand i was like that was like a colombo moment for me i don't

SPEAKER_83: want to i really don't want to be there it is i mean if you're zooming on that phrase frame

SPEAKER_77: on the space you're just like really you know it's like colombo like oh yeah you ordered the chicken

SPEAKER_89: palm on sunday night just a hint of a smirk this is j cal's pocket ace's face for anybody who gets

SPEAKER_11: invited to the poker table no this is when somebody is what it looks like when somebody re-raises me and i know they don't have it and i'm like come on come on okay founders if you're a sas or services

SPEAKER_32: company that stores customer data in the cloud and you need to be socked to compliant from a third party if you want to close big deals and you don't want to close big deals you want those lighthouse customers well our friends at vanta make it incredibly easy for you to get and renew your sock two on average vanta customers are sock two compliant in just two to four weeks compare that to three to five months without vanta and they partner with over two dozen audit firms who have been trained to file sock two reports directly within vanta it's a total no-brainer a bunch of our portfolio founders have used i love vanta they've all had an amazing experience and if you don't have that sock two compliance well you're just not going to get those major customers and let's face it those customers are the ones that are the most profitable and the lighthouse customers that draw people to your product or service and here's the best part vanta's going to give you a thousand dollars off that's right vanta big fans of this week in startups and you can get a thousand dollars off your vanta stock to compliance at vanta.com slash twist that's v-a-n-t-a dot com slash twist for one thousand dollars off your sock too and such

SPEAKER_99: a great company i made an angel investment as well congratulations to the vanta team well done i think

SPEAKER_32: the most important thing we should think about here when watching this clip like the most instructive

SPEAKER_102: part of this is man i was a fat bastard holy do i look fat you look great you look great i look better

SPEAKER_11: now you look great so wow i look like a linebacker i look like the fat kid from the what was jimmy kimmel show the man show i look like the fat kid from the man show i mean look like dom de louise in

SPEAKER_107: that photo thank the lord i don't want to focus on the past i do i look great now focus on the positive

SPEAKER_93: which is that you look amazing now you are so fit and healthy and you're going to live forever thank

SPEAKER_110: you thank you for that congratulations that took hard work and you did it i did it yes you know i just

SPEAKER_44: did what you know any other supermodel uh you know uh or instagram model has to do which is starve myself

SPEAKER_115: yeah i mean i'm just starving myself what everybody else has to do shout out that's what we're doing

SPEAKER_118: in the healthy way nothing tastes as good as skinny feels that's right that's right nick a moment on the lips a lifetime on the hips oh my god what is that oh my god no that nothing looks as good as skinny

SPEAKER_07: feels as kate moss i believe that's a kate moss oh dear god oh maybe gwyneth paul yeah i think it's

SPEAKER_110: a kate moss that feels that feels like kate moss is kind of my spirit our heroine chic genre or time

SPEAKER_125: frame she's like yeah all right so um so anyway let's let's just whip through this here because

SPEAKER_128: so what ended up he's guilty in my mind he's all this stuff happened right that prosecutors are

SPEAKER_07: alleging he lied to investors about the status of the company's trucks and technology on tv social media and podcasts by saying the company was doing better than it actually was and specifically trying to lure retail investors prosecutors allege uh they he caused he manipulated the stock caused it to go up and became a billionaire he resigned in 2020 he pleaded not guilty he i believe stayed the executive chairman of the company which is and now he's on trial and its top execs the top execs at nikola are currently threatening to quit if he doesn't step down and then yes as nick points out he called it an effing gravy train like he didn't say that to your point it will be he was like it's a gravy train don't

SPEAKER_21: worry you can safely invest in this company there are a bunch of quotes here sort of important i think just as we look at these in a letter from the prosecution prosecutors the judge the current ceo mark russell is prepared to testify that he the cfo and the general counsel considered milton's promises about nicola's progress too risky this is according to bloomberg russell is set to retire as ceo on january 1st russell claims that before coming on as president of nicola in 2019 he and milton agreed that russell would become ceo of nicola became a public company yada yada according to the wall street journal russell said quote anything he said in public was the equivalent of a press release or securities filing russell said quote that was totally against what i was bargaining for wanted to be the chief executive officer in terms of leading the company and making public statements so this is where the problem was he went on this like crazy press tour and just started saying crazy

David Friedberg: stuff and not vetting it you have a really we talk about this with our seed stage companies let alone

SPEAKER_01: public companies where people can trade the equities publicly we tell seed stage companies never exaggerate own reality present things as they are and let investors make their own decision and you

SPEAKER_04: don't ever want to be uh manipulating or bending the truth manipulating investors bending the truth it's unnecessary we all are grown-ups here investing in companies we don't need you to manipulate us if you say we don't even have a prototype we have a concept great okay the company's worth 500 million oh we have a prototype great company's worth a billion okay we have a prototype and we have 5 000 pre-orders okay great the company's worth two billion we can price the company according to reality no big deal and we see this uh molly just to make it you know um important as a lesson for this week in startups founders who are listening you might be talking to customers and you might be have a pipeline of potential customers and you might have targets right so you have targets you you want to call up uber and doordash and get them as customers in google you might have people you're talking to currently you've got apple and microsoft and they have contracts they haven't signed them but you're in negotiation and then you signed you know twilio and oracle and they're actually your customers yeah and what we will see founders do is say our customers or companies we're working with and they

David Friedberg: put all those logos on the same page this is lying this is being dishonest this is manipulating investors and there is a unique word for this when you sell securities and you lie you put the word securities and another word for people who lie and then do a transaction that was called fraud so when you're lying and then you take people's money then you're perpetrating a fraud and that's securities fraud

SPEAKER_07: and that means jail time it can he's apparently facing 25 years in federal prison over this because

SPEAKER_26: there is a difference between marketing magical thinking rosy predictions like we're all familiar

SPEAKER_07: with ceos who get up and promise that there will be really really cool products in the very near future no you know not thinking of anybody in particular um you better deliver and that you make these

SPEAKER_26: forward-looking statements that may cause your stock to go up in the short term yeah and you might then delay the release of that product right it might not happen right away but you do ultimately have to deliver and there is a line between what is lying to investors and saying things like this is a gravy train

SPEAKER_07: without really you know when you don't have to when you have no obligation to release your financials and prove that in fact it's not or you have some obligation to do that and then it's not it got to

SPEAKER_26: the point where apparently russell the new ceo said that the company's own bankers did not want milton to come to investor meetings because he wouldn't present what was on a slide deck during a meeting with softbank and then russell claims that milton thought the company's bankers quote don't know how to sell

SPEAKER_39: yeah so you know like he is yeah he's a pumper this seems like intentionally defrauding investors based

David Friedberg: on his own co-workers his partners inside the company his team throwing them under the bus and the bankers in fact saying like this this kid couldn't stay on the deck which he couldn't if he can't stay on the script i mean when and i guess masayoshi-san didn't invest so when masayoshi-san passes on your bull yeah i'm sorry when he passes on your ps red flag you know uh that's not

SPEAKER_66: a good one she's always like not for me can you imagine this kid comes in he's like we're gonna

SPEAKER_102: change everything he's not i'm good he's like i got a huge vision it's gonna be a gravy train we're

SPEAKER_26: gonna disrupt it and i mean long haul disrupting long haul trucking is in fact a great pitch that's a massive and if you think you can do it and you can pull it off and you're not pushing your fake

SPEAKER_07: truck downstairs after you literally ran to home depot to get parts for it or downhill rather like maybe but yeah he not having it yeah of course all this happened as a spac right and this happened

David Friedberg: during meme stocks and this hat and you know i i said over and over again you know you got to look at each of these companies from first principles got to look at the actual performance what's been

SPEAKER_01: delivered we have a long tradition in silicon valley steve jobs bill gates uh tesla everybody uh now

David Friedberg: zuckerberg with his headsets we all like google with their uh you know sergey showing google glass we like to show you a little bit of the future tell you where we're going and usually that comes with like hey you can order this product it will be delivered in this time frame and so when you do those keynotes part of what you're doing as a company is you're planting a flag it's it's the planting the flag strategy is is how i refer to it you're planting a flag we're going to make a headset it's coming out on the state we're going to make the model s we're going to make the model three we're going to make a cyber truck we're going you know we're going to do each of these things you can put

SPEAKER_01: down a deposit we're going to try to we're going to deliver it on this date or you know it's going to take this amount of time you can miss dates that's no problem right you better show progress you better have prototypes you better you know have apps being developed for these things and you better have a track record so with apple tesla google anybody makes a promise the stock market can say let's look at the track record of that company exactly and when you don't have a track record previous company this company you kind of have to prove some things and that was another problem here yeah this person believed they were steve jobs they believed they were elon musk obviously

SPEAKER_155: named the company nikola nikola that's the first name of tesla it was the first name of nikola tesla

SPEAKER_04: and i kind of asked him about that because i had nothing to do with tesla and i was like well this person's a liar um and so you know even with just the naming of the company it feels like a fraud

SPEAKER_26: right i mean as my favorite economic analyst matt levine says just about everything could become insider trading or securities fraud right like it it is and remains in some ways a fine i think we're seeing that with like meta right now like mark zuckerberg is out here like we're doing the metaverse i got my goggles like i got app developers on board i'm spending 10 billion dollars if nothing ever materialized it wouldn't be that far away right like everybody who's marketing because when you do a present a presentation like that you say we're going to do this product we're going to move into you are attempting that's not just for like me consumer you're attempting to reassure shareholders you're attempting to build confidence in your company and presumably get capital from public markets to keep doing what you're doing so like there there is a tipping point and probably that is very legally defined which is why this guy got charged and others have not been but it's like an interesting i mean i guess all i'm saying is like we've trained a lot of founders to do some

SPEAKER_33: version of this and it can get harder and harder to sniff out the difference and i think if yeah

David Friedberg: especially if you're a new investor you know you're some young person who's trading stocks for the first time you open up a robin hood account you open up whatever account you see a bunch of excitement around tesla or a bunch of excitement around apple and you see them using this playbook and then this person comes along using the same playbook and literally targets you and it's literally targeting you right so it's this seems like he in a premeditated way said this is why people buy tesla shares this is why people buy shares of apple this is what steve jobs does when he's on stage let me mimic that to send a pattern recognition to naive investors right listen squarespace

SPEAKER_49: is the platform where you can build or sell anything you all know it i've talked about it forever a decade here on this week in startups in partnership with squarespace we love it here we use it for all our websites remote demo day.com etc and there are so many great features in squarespace that you need to know about and that founders love obviously e-commerce has been huge for them you're like well squarespace i immediately think beautiful templates perfect responsiveness across any device mobile desktop yes but they've added inventory management apis and advanced analytics they have incredible seo right out of the box so you're going to start ranking and selling and now they have member areas what's member areas well you can generate revenue through exclusive members only content you can take all of that great content that you can teach people put it on your squarespace site and then sell it to people as a subscription or one-off pieces of content it's amazing and if you build it for yourself you don't have to give that 15 or 30 to other platforms right let people come direct to you own that relationship don't get disintermediated head to squarespace.com twist for a free trial and when you're ready to launch use the offer code twist to save 10 off your first purchase of a website or domain squarespace.com twist squarespace.com

SPEAKER_32: slash twist for a free trial offer code twist for 10 off what i always encourage people to do is just

SPEAKER_165: look at actual performance and you and i actually have ec sunday schools what what do we do in our

SPEAKER_44: investment meetings how many customers do they have when did the product launch yeah what's the churn of the company what's land who's their lighthouse customers in other words who are the top customers

David Friedberg: yeah which company has expanded the most who has added the most number of seats or the increase their spend let's just have discussions about the facts on the ground yeah and in the industry now instead of what is the story going to be in the future correct right we can establish what uh chamoff likes to refer to as ground truth ground truth in the military is like hey what are the soldiers

SPEAKER_01: seeing on the front line then we can move on now here in you know zuckerberg's uh he doesn't need a defense here but talking about zuckerberg okay you've got this business that prints tens of billions of dollars a year in profits you bought oculus which was an independent company that launched their first headset seven years ago you have x number of people on these three versions of the headset you have right this number of people paying for you know it's real okay we can draw a line between the future you're telling us in 2030 people are going to live in the metaverse and everything that's come

SPEAKER_26: before it right and shareholders are also clearly saying this week just this week no thank you like the the public markets because they can evaluate that track record truthfully because they can evaluate the technology and how far it's come and you know the interest in consumer adoption can then be like yeah we're gonna go ahead and cut zuck's personal fortune in half this week because we're not buying it they were given the truth about where the company is going and they don't like it right it's like literally the opposite of what happened with nicola which is like we got a gravy train over here and now we want this gravy train for you we they're like they they

SPEAKER_01: invented strawberry mango jewel i think you know you look at facebook trading at 12 times a pe ratio

SPEAKER_04: you know 391. i actually had sold all of my facebook that i got because of a company that was acquired i think at 110 and that was like five or six years ago felt like an idiot when it tripled or from that point uh but i just didn't want to own the company because i just am diametrically opposed

SPEAKER_183: to the founder's approach to running a company yep um and just didn't want to be involved in i couldn't feel good about owning the shares um which does matter to me i'm not that much of a

SPEAKER_04: rapid capitalist you know and now it's trading at 145. it's probably a bargain if he were to lay off a third of the facebook instagram staff which they don't need then all of a sudden company becomes more profitable and then he can invest in this new future while extracting max revenue from the existing one you know there's a story to tell there yeah but this nicola thing is just

David Friedberg: telling the wrong story it's super dark um i hope they throw the book in him i hope he goes to jail i think it's like a theranos level fraud and we need to flush this stuff out of the system and he's

SPEAKER_44: not out here killing people yeah it's it's just it's gross uh i hope i hope i hope he gets you know 10 years in jail i mean and i don't hope for another person's demise i just hope that criminals you know who abuse the system and who hurt people you know um get punished so other people don't do in the future

SPEAKER_193: yeah it's not it's not personal i just feel like these white collar criminals get away with it far

SPEAKER_07: too often oh i absolutely do think they do i just i yeah i don't know that he yeah is any more like

SPEAKER_26: i think what he's doing is incrementally worse than what we see all across business i would say a

SPEAKER_198: magnitude i wouldn't use the word he's not getting people killed dude yet right i mean if he put somebody

Jason Calacanis: in a truck that didn't work but also that's happening on the other anyway no i mean listen

SPEAKER_199: if you build a prototype and you show a prototype the the car industry has a long history of showing

David Friedberg: prototypes and most of the prototypes don't even get made they they their cars just and they don't

SPEAKER_26: drive like i'm just saying i'm looking at this and i'm saying okay the guy oversold he tried to pump up his stock in order to get a bunch of capital so that he could build vehicles because it's very hard and capital intensive and extremely technologically difficult to build these vehicles and that is a

SPEAKER_202: familiar story that's all i'm saying um yeah i like a lot if you put if you put founders and ceos do

SPEAKER_11: this so fake it till you make it is a strategy in silicon valley and fake it till you make it it's

David Friedberg: more of a confidence building exercise than a con game so act like you're going to succeed come to work every day what fake it till you make it means is you know in its best interpretation is come in with the intent that you're going to win come in with the intent intent that you're going to raise that series a be confident it doesn't mean commit fraud and so i think that term fake it

SPEAKER_56: until you make it say this is my plan i'm going to manifest my plan this is my goal right like i do want to know from people what is your future goal we want to know what their business is now and we want to know what is the thing that's going to turn this into a rocket ship yeah be audacious

David Friedberg: be audacious but own the but own the actual reality and here you have multiple examples

SPEAKER_10: of manipulating the reality they said that i'm just saying even have a prototype incrementally

SPEAKER_33: i don't think this is this is like uh no it's not the worst behavior i've ever seen

SPEAKER_07: now he did some other dirty stuff like he sold his tens of millions of his own shares during this

SPEAKER_26: back process he clearly uh did not tell the truth with respect to investors right like to go on to

SPEAKER_07: come on your show and say full stop the the semi trucks are gravy machine or whatever like that's

SPEAKER_210: that's a great return that's not true not cool it was not making money all right listen anyway

SPEAKER_07: we can differ about magnitude yeah but no matter what this dude is going down

Jason Calacanis: um and then the chat is asking yes exactly don't worry chat we are intellectually honest on this show and we are also going to talk about chamath specs sure yeah i mean it's actually the segue here

SPEAKER_44: yeah um i think there's a lot of other spac news friedberg announced his merger which is the first part hopefully he closes that spac but he announced the company they intend to merge with

SPEAKER_33: rumble did spac and chamath pulled two spacs those are the four spacs in the act as a whole spac day all right let's take these one at a time chamath is in fact winding down two specs ipod and ipof

Jason Calacanis: yes ipod and ipof yeah and will return uh cash to investors based on a report in the wall street journal nobody's pretending any inside knowledge here i certainly don't have any nobody talks to me chamath said that his specs considered over a hundred companies to take public but were not able to finalize any deals aka rush through a nicola and inflict that on all of us um in july it was reported that bill ackman also was winding down his back and returning four billion dollars to investors the deadline to find a merger for these two spacs chamaths was october 2022 after a two-year deal window

SPEAKER_44: spacs have a window for those who are new to the spac space it's a special purpose acquisition

David Friedberg: corporation you raise a bunch of money you go out and look for a target you evaluate those targets you announce it like freeberg just did with his uh the production board's back and then you de-spac and you have this uh publicly traded company right and we knew you always know it's backs that there's a ticking clock so this sounds like and let me just stay here even though chamath and i are besties i have no information about this obviously i do not talk to my friends about the inner workings of anything that's any way related to the public market i will talk all day long about a private company sure but i stay away from that uh so that i never you know on this show ever step in it or you know i try not to comment too much on my closest friends projects um you know talk about them maybe from a product perspective but just looking at all of these specs because there were 500 specs at one point um i don't know what the high water mark is but there are websites that look at this setting up a spa cost five ten million bucks if you and i wanted to set one up molly you could set one up for five or ten million bucks and we got a bunch of money there and it seems like the easiest

SPEAKER_01: thing in the world go find a company here's the problem the company has to want to do it so now if you're a company and you've watched spax underperform relative to the market right and you've watched

David Friedberg: them get a little bit of a you know a little tarnish there on the reputation yeah they might be

SPEAKER_01: signaling lower quality and that's not obviously true in all cases and i wish it wasn't because i would like to see more companies going public earlier because i think it's actually healthy for the market for people to be able to buy into a company when it's at let's call it 25 or 50 million in revenue i think that's actually kind of cool that people could be public with as a little less

SPEAKER_170: 25 50 million in revenue it's been a problem that companies stay private for so long exactly so

SPEAKER_01: if you were though a private company and you raised a bunch of money so this is where the you have to understand the complete chessboard you raised a bunch of money tpg koto tiger global whatever you know a sequoia or andreason harwood's late stage fund put 100 million dollars into your company you don't need to spac you're sitting there with two years of runway three years of runway you're within spitting distance of being profitable or maybe you are and the markets don't seem that friendly well you're going to take your billion dollar five billion dollar company have its back and then have all your employees be underwater or have the company be trading at 30 cents on the dollar 70

SPEAKER_04: cents on the why why deal with that right just stay private right and so now here we are and if you're

SPEAKER_10: on the other side of things you're tamath or bill ackman you want to bring a good company of course to

SPEAKER_26: market via your spac and so if you you know have a situation where the good companies are saying no thank you we're sitting on a pile of money we're just going to stay private and the alternative is to push through a company like nicola that doesn't have a product yet or isn't going to or or is going to be overvalued and end up in a situation where all it does is like continue to perpetuate this idea that's backs are for companies that are no good you can see why you would choose to shut down the

Jason Calacanis: spac and return the money like that doesn't seem that to me does not seem and again i say this knowing nothing like that seems fine seems like sort of how it should work like you set it up you

SPEAKER_26: try to do it if you can't find a good company i mean obviously you'd prefer to find a good company and take them public but if that's not an option don't take a bad company public just shut it down

SPEAKER_05: and give the money back one fact that you need to know about startups finding engineers is super

SPEAKER_32: time consuming and super expensive it's the biggest pain in the neck in startups i would say raising money is easier than finding great developers well if you're looking for qualified international developers without the crazy time differences or if you just want to scale without sacrificing on quality well revelo is the answer revelo is a talent platform that matches you and your startup with vetted full-time remote developers in latin america they work in the same time zone as you in the united states plus it's more cost effective than hiring in the u.s obviously and you'll get matched with vetted candidates within three days this lets you hire internationally so quickly and so easily revelo's engineers are of course full-time and they're embedded in your team just like normal employees they're proficient in all the things that you probably have in your stack whether it's aws rust ruby react python node.js and more revelo's customers wait for it github foursquare carta indiegogo kickstarter i mean this is a who's who of successful companies so go to revelo.com twist and mention twist to get 20 off your first three months plus they offer a hundred percent risk free 14-day trial period if you're not satisfied you pay nothing so head to r-e-v-e-l-o.com slash twist and mention twist to get that 20 off

SPEAKER_17: yeah and you know a lot of the companies that were going public were actually good companies but maybe

David Friedberg: their stocks and the valuations were too high right so if you take a company out at too high of a valuation and the shares trade every day well you now are going to have price discovery on that so private companies sometimes can get a little overvalued and they have to grow into their

SPEAKER_32: valuation some private investor says you know what it's competitive to buy into this company i believe

David Friedberg: it in the long term uh the valuation is a billion right now i'm pretty confident it'll be two billion or three billion next year i'll pay the two billion i'll win the deal yeah so in private markets sophisticated investors can as we say in the business jump the fence they can go awol they can be super optimistic and pay a higher price because the shares aren't trading they can wait it out

SPEAKER_01: when it's publicly traded and you got all these people all the insiders can sell maybe people want to clear their position and invest in something else and then all of a sudden you're in a debt spiral

SPEAKER_04: or the company just you know goes down to reality that two billion dollar price goes back down to one billion you're now down 50 percent and the company is um you know tarnished a bit right they're there they look like a loser publicly even though they might actually be a winner in making great progress as a startup so this is why people had the stay private longer spl approach for many years which

SPEAKER_183: is why deal with the public markets but obviously virgin galactic open door clover all these specs

SPEAKER_04: uh each month that you know they're down 70 80 percent it's it's these are actually open door i think it's a great company virgin galactic obviously very speculative company uh clover health i think is a great company sofi is a good company so some of them are great companies uh good or great companies they're just either mispriced or now they're in the doghouse for a little bit and they're going to have to prove it so i actually have been thinking about a jtrade looking at some of these i'm really attracted to joeby i love the idea of vtols i think somebody's

SPEAKER_183: going to win in that space but i have to look at actual value you know so back to first principles you know how many orders they have how much revenue they have do they actually sell this stuff and we should but i did make a j trade yesterday by the way oh oh yeah i did j trade alert

SPEAKER_107: j trade alert j trade alert not a big deal but there was a big m a transaction last week yep and it's so weird because public markets didn't like it public markets didn't like them this is not

SPEAKER_44: investment advice but i love it i think adobe made a great purchase so i bought 250 shares of adobe i think adobe wins the day i think design and design tools and that category is critically important if apple could buy this company they would if microsoft could buy this company they would i think they eliminated their number one uh existential threat they have a canva competitor that they're working that you know that's in market and um you know now it's the only thing out there really

David Friedberg: fighting adobe is canva and i think you know they don't have to crush canva but they just need to be competitive with canva if i'm adobe i make canva competitor free i make their canva competitor

SPEAKER_39: free um and then if you go into multiplayer mode whatever so they should do the bundling that microsoft is doing the canva part of the bundle i forgot the name of their canva competitor will come to me in a moment

SPEAKER_110: i don't know but i will say shout out canva because clearly with the mindshare

SPEAKER_44: this is why exactly adobe spark is their competitor so here's my advice to management i know they love to hear from me and now that i'm a shareholder that's right 250 shares 75 dime skis worth spark

SPEAKER_49: let's get anti-competitive i'm sorry let's get competitive oh did i say anti let's get competitive i don't want you to be anti-competitive no i just want you to be competitive that's our onboarding

SPEAKER_261: it's free for a life spark is free for a life and uh yeah let's just go head to head i mean listen

SPEAKER_183: i like melanie too i think she's awesome founder of canva but i'm not a shareholder in canva yet i

SPEAKER_17: have made a jtrain people were wondering if i gave up my jtrain yeah you know he's a he's a selective

David Friedberg: shopper prices were going down uh for a month we're waiting for i think today is the interest rate uh hike day i think so so you know i always said i wanted to buy like up to 20 names 2 million bucks from now until the end of the year was my plan ish and uh yeah taking a couple of weeks to digest the trades i made and if things were going down you know i don't want to buy into a cratering but i think we're bouncing along the bottom i think things could go down another 20 i think that's the worst case scenario right now i believe the recession happens molly we could see 20 but i think that's

SPEAKER_44: the worst case 20 on top of the 20 that we went down this is not investing advice adobe express is

SPEAKER_04: free free until spark they hear you good yeah i mean it looks just like canva and they made it free but is it free until a point did you say i guess we have to look up the pricing somebody use forever

SPEAKER_89: free use forever oh wow they did do it they already did okay i'm gonna buy more shares i think

SPEAKER_44: i mean literally this is the gangster move you know we talked about this like you know they made microsoft teams free or they did the bundling it's not free it's part of the bundle uh but all the

David Friedberg: i mean right right after you have this call i'm gonna i'm going to ask my teams what are we paying for canva if we're paying more for more than a thousand dollars a year for canva or two thousand dollars a

SPEAKER_26: year can you ask well they have on air the free version there's a free version and a premium version to be clear and the premium version definitely but it still is only 10 bucks a month i think canvas

SPEAKER_44: only 15 bucks a month or something but can i get a report back what is inside and what is it what are what's inside and what is launch paying for canva if it's over a thousand bucks i'm going to be asking my team like why are we paying for this and not using spark express whatever it is obviously

SPEAKER_219: so if it's under a thousand businesses don't think about it if it becomes more than a couple thousand

SPEAKER_04: you start thinking about it you start thinking about spend in sas all right let's do rumble

SPEAKER_10: rumbling last back story it's just back tuesday that's what it is now rumble for people who don't

SPEAKER_11: know is a conservative youtube yeah am i correct that that would be the best description of it and i i downloaded the app and i looked at it it's actually like feels like it's 75 feature parity with youtube at least from the user interface perspective it looks pretty close

SPEAKER_04: not that youtube is the hardest thing to copy it's the scale of youtube that's hard to copy but well yeah exactly well i mean i also mean scale of the infrastructure the back end like you know the ability to handle many uploads i'm guessing rumble is on aws or something all right so in may 2021

SPEAKER_44: the company raised at a 500 million dollar valuation peter till led the round so maybe they put 25 50 million dollars in not through founders fund he didn't want founders fund to have their fingers on

SPEAKER_07: maga conservative stuff yeah but maybe it seems hard to separate but yes the press release for the spac is amazing the ticker symbol is rum r-u-m okay i like and from the press release they say

Jason Calacanis: while stock ticker symbols can be an afterthought for rumble rum holds a special connection to the

SPEAKER_26: company's mission to protect a free and open internet it's a little known fact that rum was

SPEAKER_65: one of the many catalysts of the american revolution due to unrest created by the british-imposed sugar act

SPEAKER_07: of 1764. did adam newman write this to do with anything so you heard it here second rum is attempting to incite the american revolution great this is gonna go awesome fantastic what a value prop

Jason Calacanis: should we do some we can talk some numbers okay so without oh yeah without rum they they go on to note the colonists may never have fought to win the freedom that americans enjoy today the very freedom

SPEAKER_21: that rumble exists to protect thank god that rumble exists so andrew tate or whatever that name is

SPEAKER_193: can do a stupid version of andrew dice clay 30 years later they have 78 million global monthly active

SPEAKER_44: users which is super impressive 63 million in the us i mean basically 70 million people voted for trump right so looks like they got all of them i'll be really curious to hear more

SPEAKER_07: about this as it goes on and it's public but yeah q1 revenue four million dollars 73 percent year-over-year growth q1 gross profit 550 000 which was actually down year-over-year 36

Jason Calacanis: q1 net lost 3.9 million dollars rumble was profitable on a net basis in q1 2021 so this would be about a four million dollar loss year-over-year yeah i mean this is tiny numbers 78 million global monthly right although they say 63 million of them are in the us and canada so they're only seven

SPEAKER_04: million away from having every trump voter theoretically i mean some people are probably coming to this research or didn't vote for trump i'm sort of just making an analogy to their natural

SPEAKER_93: users is such a you know this is these are monthly active users is like a it's a tricky number

SPEAKER_07: yeah there's a lot of parsing of of active user numbers let's just put it that way

SPEAKER_181: i mean if they're putting out multi-active users in our industry that means they touch the app or the

SPEAKER_04: website there are some people who have done some fugazi stuff in my opinion like you opened an email uh remember that was next door we're saying if you if you got an email that counted as a user i don't really count that but nor do i count like people checked out your i don't know followed you on twitter that shouldn't actually count but 500 million dollar market cap how much cash do they have left they must have a huge cash position if they're only burning four

David Friedberg: million a year it's an impressive start on a user basis they're obviously not trying to make money nor should they they should just strictly try to double the number of users every year that's what they should be doing with this business and if people who are investing in this business they shouldn't be looking at revenue numbers they should only be focused on getting to 250 million users when they have 250 million users a month that's a very large business

SPEAKER_10: that's an incredible base of users 41 million dollars in cash and equivalents and if you look molly this is how i'd evaluate quite a press release but from a business perspective putting

SPEAKER_04: aside that they're a little bit wacky and zany there's like kooky people uh in terms of like how they're presenting the company but they got a kooky audience right the audience they're they probably

SPEAKER_01: know their audience their audience wants to think they're yes you know involved in a revolution and that

SPEAKER_95: where we're gonna storm the capital like yes that's kind of in their wheelhouse very this is a very

SPEAKER_128: directed message yes for a very directed audience exactly yeah i mean i don't want to say dog whistle

SPEAKER_44: it's kind of just a whistle um so q1 revenue 4 million they're growing 73 year over year it's okay

SPEAKER_04: growth it's not you know startup growth but for a public company it's great growth they lost 4 million dollars 3.9 million in q1 so if they're losing 16 million a year they got 41 million in cash they'll be fine they got three years of runway ish uh and they got 78 million global monthly active users in august yeah 63 million in the us which equals almost as many people as voted for trump this is like a maga site and the question is will this grow beyond maga that would be my my question is do they have aspirations i can tell you they do because they started lobbying to put all in clips or all in on rumble and i was like great would we be between milo yiannopoulos and andrew tate and alex jones no thank you right and i think they're going to be the place for refugees if you get kicked off of

SPEAKER_57: youtube you get kicked off of twitter yeah go there i mean i think they've sort of expressly pitched that so far they did change their terms of service to open up the aperture

David Friedberg: on hate speech so if you do a search for my twitter handle i actually asked them about that because there was a story very recently about them changing their terms of service

SPEAKER_44: um around hate speech now why would they do that so you gotta ask yourself why would they do that i know

SPEAKER_07: like you're not actually asking me that right because you know we all know yeah i mean look every

Jason Calacanis: this has been uh irrespective of the ruling in texas recently which i don't know if you all have been following this but there was a ruling in texas that basically said like no an internet provider cannot take down any speech like it upheld a law that said you are required as a platform to keep up speech even if you disagree with it irrespective of that which i do not expect to continue as the law of the land every platform that has attempted to sort of be like we're the free for all has eventually had to moderate like eventually you have to moderate because the child porn comes in and the terrorists come in and you're you know your your isp pulls you or something happens so or your

SPEAKER_324: employees simply don't want to deal with the threats that wind up happening so this happened with

David Friedberg: cloudflare they are an infrastructure company that does what's called cdn content delivery network so they're not just forwarding ip addresses they do that so they do a dns resolution but they also

SPEAKER_44: will speed up and protect you from a denial of service again they had to take down that crazy

David Friedberg: website kiwi farms yeah um and they just felt imminent harm was coming and so the um founder

SPEAKER_95: of cloudflare was like this is against everything we stand for of we're just infrastructure we're not responsible for what happens uh right you know on your platform like cloudflare has been the kind of

Jason Calacanis: safe haven for a lot of these sites like i think they had the same thing i think the same story happened with like parlor and getter on cloudflare maybe and at some point it gets too much even for the the platform that says we want to be totally neutral because there's just not yeah i mean you

David Friedberg: can be neutral until conversation but you are your employees uh or people in the public are under uh you know imminent threat of violence and that's when most of the ceos

SPEAKER_44: say yeah that's the line right i'm only talking about the ceos of these freedom of speech you know free for all platforms no i know even they will stop when violence is at their doorstep

Jason Calacanis: right like being this kind of platform represents a business risk and most of them have followed the same trajectory so far and so it will be interesting as rumble you know goes public to see whether it follows the same business trajectory which is that eventually

David Friedberg: it has to stop being the thing that it said it was the aclu itself would fight for the freedom of speech for you know kkk nazis to march down main street or whatever yeah you know those positions have changed even for the aclu and online they certainly have changed uh and so this will be the equivalent you know like they'll probably let nazis or kkk people on their platform that's my guess or even dog whistling versions of that and they'll do that until they get sued or they have threats of violence right so they'll probably just be modestly more permissive until such time as their own

SPEAKER_193: own employees and or management teams are under threat of violence or they probably don't care

SPEAKER_07: about other people being under threat of violence right i mean they'll eventually have to moderate illegal content which is what almost always starts to happen and then the user base gets

SPEAKER_346: furious and it'll probably listen all right i would not j trade it put it that way i don't i think

SPEAKER_05: this is a small opportunity i don't think it's a good opportunity i would not j trade it not a j trade

SPEAKER_07: there we go all right thanks for listening tomorrow is an amazing interview that jcal did with mojo ceo

SPEAKER_39: vinnie bahara brother of preet yes great interview he's making a stock market for athletes where you

David Friedberg: can actually do real money uh trading of athletes you can bet on your favorite nfl players i think

SPEAKER_04: it's a great idea i love wagering i think wagering is a great way for people to have skin in the game so to speak and uh you know i love these kind of markets and new ideas so and he's a really cool cat he had a lot of great success with diapers.com and cafe.com which they sold and so it's an awesome

SPEAKER_99: interview we will see you tomorrow bye bye bye bye