SPEAKER_00: hey everybody it is monday welcome back to this week in startups we got a lot of news to talk

SPEAKER_01: about today yeah we'll do a little recap of all in episode 92 a lot of great feedback on that and then we're going to talk about crypto currency yes because ftx had some leaked documents massive

SPEAKER_05: growth from 2020 to 2021 massive growth so you know we're going to speculate that perhaps when you financialize a product before it actually has any value that might be um back backwards development we'll see we'll see interesting discussion then we're going to talk about amazon's reported bid to buy signify health and what amazon might do to the healthcare system and spoiler alert we just hope they freaking fix it i'm super excited about competition coming to

SPEAKER_15: healthcare and innovation and then we'll touch on ebay buying a trading card marketplace in our m a segment and what you can learn as a founder or capital allocator from a niche marketplace forcing

SPEAKER_05: ebay to buy them because they kicked ebay's ass yep it's just that simple and then i'm excited i'm going to be interviewing another launch accelerator founder at about a business that is just really really close to our customer service diva hearts all right it's going to be a great show stick with us

SPEAKER_20: this week in startups is brought to you by neotax don't leave money on the table claim your research and development tax credits with neotax and get 500 off any service fees related to neotax products learn more at neo.tax twist odoo is a fully customizable and fully integrated suite of business apps that lets you build and scale your stack as you build and scale your business your first app is free forever and right now odoo is offering one thousand dollars off your first implementation pack at odoo.com twist that's odoo.com twist and 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 startups hey everybody welcome it's monday how's your weekend molly

SPEAKER_26: monday monday monday i had a like a nice like at home i planted a bunch of new plants i did a bunch of hiking took care of the doggies it was nice because you know i've been traveling it's good to

SPEAKER_30: be domestic it's nice to be domestic i just uh came back from my little tahoe stint my 12 year old

David Friedberg: started school up again today a big seventh grade i took her out to a seventh grade dinner last night as is my little tradition take him out to dinner to get ready for the new year so cute and then my six-year-old started i guess on monday or tuesday so i'm back it's peculiar here in the bay area because depending on the school you go to a lot of the teachers are gone

SPEAKER_40: for burning man what no way yes i i was part of alt school remember that alt school the google is creative school for the first year and then i was talking to the founder and they're like yeah you

David Friedberg: know like so we're starting school like but we're gonna have a lot of people out or whatever because a burning man and we want people to be able to go have their burn and then teach your kids and i was

SPEAKER_05: just like hmm let me link this through for a second the bay area is amazing also pretty amazing i'm glad that you reminded me about that i am now going to make plans in the city for this week and drive to san francisco because there's no better time to drive to san francisco oh my god you're gonna get

SPEAKER_46: a reservation because nobody's here i'm gonna get i'm gonna eat at every restaurant all week long

SPEAKER_49: yes oh hot damn so it was um yeah uh but i'm kind of bummed to be back from tahoe i just had a great summer you know it's so nice it smells so good beaches and yeah i just i think i'm a i think i'm a country boy now like i think i hate the suburbs i love cities and i love the country i think i'm like not a suburb guy i'm kind of out on the suburb tip and i just want to either be in the mountains

SPEAKER_13: or i want to be in a city yeah i think that would be my ideal life i can actually totally see that i

SPEAKER_05: don't hate i like my like uh i call my my my life in oakland herb urban like yes it's kind of suburban

SPEAKER_00: my neighborhood but i'm in oakland and i like that so i still have the sort of all the access to the city and the occasional sideshow around the corner but i have like sidewalks and all right so uh

SPEAKER_58: did you get to catch all in this weekend you caught the all in i did i listen i listen on monday

SPEAKER_05: morning and make that part of my like uh dog walk and drive home from school routine

SPEAKER_59: do you like free burgers moderator i liked it i like it was nice for me to comment i got to like

SPEAKER_05: i know how was that for you were you like relaxed or was it stressing you out you're like i would

SPEAKER_13: know it was delightful to just shoot the basketball usually i gotta bring the ball up the court i gotta

David Friedberg: pass it people don't like where i put the ball everybody's complaining constantly i challenge somebody they get upset that i'm challenging them i'm not picking any one bestie but you know some

SPEAKER_64: besties feel like they shouldn't be challenged ever and they should just do a monologue and i'm like

Jason Calacanis: well then it's not a conversation but i was like i liked how you put the monologue at the end by the way what and what i'm now calling the mega minute i think that's a great segment you're not the only

SPEAKER_14: person right at the end refers to it as such well i just decided i'm out i don't want to talk about

SPEAKER_69: politics anymore i'm so burnt out on the trump talk yeah and i feel like you know i want to have first principle discussions about each instance and you know when you have people on either side it quickly sometimes devolves into that tribalism yeah or like talking points or people like why didn't you bring up these three talking points sax brought up these three points you should have counted with these i'm like i don't want to be cinderella cleaning up that mess i want to have a first principle talk you know which like when it comes to some of the things that are occurring let's say with trump i'm like i trust law enforcement yeah there could be bad apples but i overwhelmingly

SPEAKER_72: trust law enforcement i come from a family of law enforcement overwhelmingly trust them uh and i would

SPEAKER_73: say in this instance they're going to be like super you know buttoned up because it's the president

SPEAKER_74: former president so i'm like i'll just wait maybe yeah yeah i think i can wait well it's it's not a

SPEAKER_00: politics it's not a um it's not a philosophy or a point of view or whatever at this point it's a religion conversation right like it's just religion no minds are going to be changed so it's yeah i realized it doesn't feel it doesn't feel productive whereas i think you had some really interesting productive like i mean also of course i was super excited to hear the mention of our climate

SPEAKER_05: syndicate i was like i was on all in this weekend i mean my name yeah which is thrilling but that was a super yeah that's true i had a big friday um fun friday on the internet i got several messages

SPEAKER_00: from people who were like oh my god i didn't know you had a climate syndicate this is awesome excellent

SPEAKER_79: let's go i did shout out that we've made some measurement stuff what this is we talked about

SPEAKER_80: this uh you know i don't want to make this into vc sunday school but you and i have been talking about

David Friedberg: like you know being a great uh investor and is you know about the bet it's about the companies

SPEAKER_69: and you know building these frameworks in your mind and we're learning the climate space right which is evolving and there's a ton of people who want to be involved in climate just like there's a ton of people want to be involved in crypto yeah but in emerging categories you get this rush of people

David Friedberg: who want to be involved some of which are capable of building world-class lasting companies the majority of which you know might have tremendous enthusiasm but may not be able to execute or their idea might be small or unfeasible or they just don't have the depth of knowledge or experience to pull it off right and so you're trying to figure out well what what is the opportunity here right because it has to match both things you have to two sir really have three circles like can this be a good deal is this the right founder and is this the right business like idea product whatever so you get this like venn diagram of three circles and you know you find great founder great idea but maybe not a good deal you find a great deal great founder bad product whatever it is you really got to check

SPEAKER_87: all these boxes but i'm really happy about the first two measurement companies you found i think so too

SPEAKER_05: i think that's a really interesting i i talked about this actually on pivot um which is that part of

SPEAKER_00: you know there's been this just like you said there's been this big rush into climate tech and there's these kinds of there's this sort of question about that we're that literally is happening in real time right like what is investable in climate so there's like founder product deal and then in

SPEAKER_05: climate you almost have to add like yeah does this exist yet right like is does this market exist does this technology exist does the infrastructure to support this technology exist does pricing exist for one of the commodities that you're talking about in your equation you know like there are so many parts of this ecosystem that are still being figured out in real time and so many and you know new it's great that i'm like simultaneously a new investor in a new field because we're also all figuring out together what is investable and like when i was listening to your carbon tax conversation and like the the the problem of ever creating a global carbon tax comes down to measurement it comes down

SPEAKER_95: to like it comes down to measurement it's so great our category yeah great and maybe it is and maybe

SPEAKER_97: that's not the only category but maybe it's the first category right maybe that's the first category

SPEAKER_86: exactly if you learn a whole bunch specifically so we get to make great investments while we're learning

David Friedberg: yeah then the metrics would inform okay what's the next one to turn over it's almost if you look at the history of the internet it was like okay we need servers sgi you know sun microsystems okay we need fiber at&t whatever okay we need modems haze modems we need cisco to make routing equipment then it was like okay what can we put on top of this okay google and yahoo are indexing this we can help you find stuff totally yeah okay what's an application we can build on this okay amazon you want to buy something i don't know bank of america could have an app oh we have apps okay now we have oh we have mobile in our pocket so like each each of these things builds and then you know it might be that

SPEAKER_105: some people are building for the 10th floor when we don't have the foundation built yet you know which i think a lot of crypto people talk about often absolutely that's and that's absolutely what's

SPEAKER_00: happening and so there's this i like i i hate any conversation that doesn't acknowledge

SPEAKER_05: an evolution that's currently in process right that's nascent so if you're yelling at me about what vcs should be doing in climate or what they shouldn't be doing or what they think about this

SPEAKER_109: and whatever it's like guys we're literally figuring it out in real time yeah right now we are building

SPEAKER_69: the plane if you don't if you can't even measure what's happening right like how you gonna tax it

SPEAKER_114: i mean we should give a shout out to the two companies we invested in right it's no now

Jason Calacanis: yes okay so there's like one of them is like an embargoed press release as of tomorrow

SPEAKER_117: oh okay well then we won't mention it until we can mention the first one okay yeah so just explain

SPEAKER_00: the first one we we did yeah so we excited about that yeah so the the first deal that's super exciting is about measuring shipping emissions the company's called sail plan they just actually had a big write-up or a big piece in wwno the new orleans public radio station shout out public radio

SPEAKER_05: because they signed a deal with port for sean they measure shipping emissions and they do it like ship to ship installing software and some sensor hardware on commercial shipping vessels which are like a massive emitter obviously right huge um and they can use a type of fuel that is a little more

SPEAKER_48: raw than the fuel we use in our cars right they do and actually they use two kinds of fuel at once and

SPEAKER_00: so one of the things that's things that's interesting about the sail plan measurement is that they can say to it you know the captain of a particular vessel say hey you're emitting a lot right now which means you're actually using the bad fuel and the bad fuel costs more so there are times when they use a fuel that's less polluting and times when they use the more polluting raw fuel and if they are accident and if they just like haven't switched the system yet then they might be emitting more and also paying more and so it like saves these shipping companies money and also uh reduces emissions it's sort of like the double the double goal and then you know they're in port for sean which is a big oil and gas port america's biggest oil and gas oh my god

SPEAKER_124: look at my picture on the website oh wow there's your board look at that you're on the website oh my

SPEAKER_26: biscuits omg what what what but yeah like it's about taking when you have to solve a big problem

SPEAKER_05: you have to break it down into its component parts every problem has multiple chunks that you need to bite off in order to solve it and so the investable part for us might be in software that measures

SPEAKER_26: emissions there are probably lots of other ways to chunk that out but like awesome that's a great place

SPEAKER_05: to start yeah i'm really excited to see where this goes we'll be announcing the other

SPEAKER_01: one tomorrow right yeah and so if you're interested in this and you're an accredited investor the syndicate.com climate the syndicate.com climate we also have a syndicate for sass so if you're an accredited investor you only want to invest in sass the syndicate.com sass and if you

SPEAKER_105: just want to invest in my deals that's the syndicate.com was like the big one and those are the jason approved deals so what we're going to do with the syndicate over time is have like verticals and there's the deals that i do and then there'll be deals that originate from our syndicate 11 000 syndicate members but you know some people don't want to even see climate some people only want to see sass some people only want to see climate so you can join multiple syndicates there and then you look at the deals the average investment investor puts in seven six or seven

David Friedberg: k per deal so you get to like you know if you're an accredited investor at least you get to make small bets on things that you think could get a return or that you want to see in the world right or

SPEAKER_05: both ideally both we're not we're not impact investors in that way we're not like the concessionary

David Friedberg: kind yeah well i mean here's the thing about being like uh an impact investor we all want to see good impact in the world like how you said that you don't you know the problem is yes if you no returns

SPEAKER_114: means no more investments so you you know if you take a bunch of investors money your structure

SPEAKER_00: that's charity and your investors know it and that you know and they're like deliberately and you've

Jason Calacanis: got a double bottom line and that's the whole agreement and everybody's like we want this to

SPEAKER_139: exist and we'll take 2x instead of 10. fine or take no x right i mean i think maybe take no x right yeah

SPEAKER_114: and then it becomes like charity so i'm always a fan of yeah just being what they call evergreen in our

SPEAKER_05: business right i'm actually also and before we switch to the news one very exciting thing happened over the weekend on twitter which is that someone called me a cold-hearted blood-sucking pc

SPEAKER_142: oh i know i thought you were so proud oh molly you free market monster i know look at that one of us

SPEAKER_148: you went from like queen of public radio super woke in the hills typical blood-sucking pc you're

David Friedberg: you're a bay area i've arrived liberal and now you're a free market monster look at you like you must be i

SPEAKER_152: can see the internal conflict in you there must be good left in you it's like you're just turning

SPEAKER_155: into dark i don't know before my eyes i guess we'll see my heart will i chop cities in half or not i don't know we'll find out we'll find we'll find out i mean listen i mean it's good to there's like um

David Friedberg: in the matrix you you take the pill and you kind of see how the world works is one of the things

SPEAKER_105: that happens as a journey when you're on the outside and then when you're an insider when you're a commentator critic you know commentating on the world which is which is a valid thing to do in the world like i spent a large portion of my career doing it and still do randomly here and then there's

SPEAKER_49: like when you build stuff right and when you get to see both you get to sort of have this appreciation um where like criticism in the world is a valid pursuit and you know people can write criticism of a

SPEAKER_55: restaurant or journalism at its best investigative journalism all very helpful in the world and then you see how things are built and you're like uh yeah it's hard yes exactly you have a whole different

SPEAKER_164: right totally and humans are flawed and bad things happen in the world and so true so true so true

SPEAKER_152: right now it's important for founders to save everywhere they can and this includes the r d tax credits

SPEAKER_171: which are a pretty low-key way to save up to six figures every year year in and year out and neotax will help you claim up to 250 000 if your business qualifies the best part there is literally no downside to using neotax the full application takes only 15 to 20 minutes you'll know in the first couple of minutes if your startup is applicable and you only pay if you get some money back their app integrates seamlessly into most accounting and payroll software like quickbooks and gusto and these tax credits do not roll over from year to year so it's use it or lose it folks you got to get it done neotax has already helped over a hundred startups get these tax credits so if you're a startup you have to check out neo.tax slash twist that's right zero commitment to get started head to neo.tax slash twist and get 500 in credit on your r d tax claim neo tax is making taxes less taxing a lot of

SPEAKER_05: crypto stories this morning it's been a long time i think since we had a big old crypto dump but we have

SPEAKER_13: some crypto news including some leaked audited financials on like audited i like audited yes yeah

SPEAKER_05: and this is actually not about tether this is not a flaw so leaked audited financials show that ftx revenue grew more than 10x and profits more than 20x from 2020 to 2021 we should probably start by

SPEAKER_00: explaining what ftx is and does this is of course the sam bankman freed exchange the guy who is buying up the entire uh crypto industry as it falls into disrepair or parts that are falling into disrepair

SPEAKER_179: because he can because he making tons of money yes they're the one who is headquarters in the bahamas and he's a material guy who yeah is very um unique and outspoken fascinating so an ftx itself like you

SPEAKER_26: said is uh headquartered in the bahamas it's basically uh coinbase on steroids so it's an exchange users

SPEAKER_00: can buy and sell futures options leverage tokens nfts even fiat currency it has a retail and an institutional business and the institutional traders are served by this sort of over-the-counter platform and then they make money with a tiered trading fee structure so the more volume you trade the lower your fee very typical actually in institutional investing but in this case with more of a crypto focus they also charge traders a daily interest rate when they trade on margin so point zero three percent daily with a point ten percent redemption fee um and then they also charge a five percent fee on both sides of nft trades just as a little explanation of how that grant that revenue

SPEAKER_152: grew 10x and profits more than 20x and so you know the question i always have with this stuff is like i wonder what's happening now did it go back down i would guess that it reverted and they're

SPEAKER_87: doing what they did in 2020 or 2019. you think yeah yeah i would think i don't have any insight into

David Friedberg: what institutional investors are doing but it does feel like you know and this is a private company so we don't know that's why the leak is kind of notable private companies don't have to disclose their information but they have investors in all likelihood and so some investor leaked this or

SPEAKER_87: somebody they were raising money or some associate or whatever in all likelihood that's how this got out or it could be somebody internally who got laid off or disgruntled or whatever has an axe to

SPEAKER_105: grind but you have to wonder what are these people doing here why are they buying cryptocurrencies and it does feel like this is like has a gambling aspect to it right like these people are trying to find ways to gamble on cryptocurrency because there's no inherent value in almost any of this

David Friedberg: stuff so this does feel like a house of cards to me in some ways probably was right it's the big crypto

SPEAKER_00: craze so of course there was a ton of and since they make money on volume of trades much like coinbase you would imagine that yes it's all these people getting into this craze in the house of cards speaking of house of cards another interesting thing from the documents shows that so like sam you know there's here he is buying up all these component parts of this industry yeah uh it seems the more you dig into any of these companies the more you seem to uncover that like they're all each other's

SPEAKER_05: customers lenders borrowers you know and and and at some point collateral providers in this case sam bankman fried also founded alameda research a trading firm okay which according to the documents accounts for about six percent of ftx's exchange volumes okay yeah he's uh dogfooding his own

SPEAKER_196: product right he trades a fund on his platform so this would be like if this would be like this is

SPEAKER_72: not like yeah had a hedge fund where he's trading stocks on his own platform and he was six percent

SPEAKER_200: of the platform that's that's kind of how i would interpret it it's kind of weird but okay so he's

SPEAKER_201: one of he's one of his own biggest customers yeah sort of i mean it's if it was 60 you'd be like well

SPEAKER_202: that's weird but if it's six percent six percent probably fine i mean it's not nothing but you could

SPEAKER_72: take the six percent out and still be i guess ostensibly if you're an investor a good business

SPEAKER_00: about two-thirds of revenue came from futures trading fees fascinating while roughly 16

SPEAKER_114: percent came from so-called spot trading yeah you know it's fascinating to me that all of this energy is going into this space and people are spending all this time trading it when they're getting no

David Friedberg: value out of the core currencies so what are they doing with the core currencies it's almost like we created you know uh you know a virtual casino where people get to trade on currencies that and they have to play some game here but there's no underlying value to those things so if you're j trading stocks you're like well amazon i use it i got amazon prime i got you know i'm getting packages to my house or i

SPEAKER_30: use robin hood i invest in robin or i take ubers you know i stay in airbnb so i'm buying those things

David Friedberg: i use that product here you don't have anybody who's buying and selling these things and flipping them actually using those products right and understanding those products and so that's why

SPEAKER_196: i think this whole thing is such a house of cards and i think there's more collapse to come if i'm

SPEAKER_125: being honest it is really interesting because it's like these are all financial products right so this

Jason Calacanis: is just a pure ftx in particular as the notice point out and we just said it's one of the few places

SPEAKER_00: you can do options and futures trading and derivatives and those are more profitable for exchanges so those are all financial instruments yes that people are engaging in trading now all of

Jason Calacanis: those exist in public markets and equities trading sure but they're you but they're based on something

SPEAKER_05: you're trading options and futures in like hogs or corn or mortgages exactly gas oil things that go in

SPEAKER_15: cars warm people's homes an actual commodity that's in use like what is ethereum what is bitcoin and forget right and forget going down the long tail of these things so this is like you created

SPEAKER_00: a thing out of air and sure right we we are all aware that there's sort of like various projects being created that may or may not end up having lots of value and whatever but at the end of the day these were like things created out of air and then they sliced and diced and financialized the pieces of air and traded that this is like how i feel about buying apartments like i'm such a

SPEAKER_97: montanan that i'm like that's not that's buying air you're buying a floating box yes yes it's even

David Friedberg: that is hard to comprehend when you're earthbound you know country girl you're like wait a second

SPEAKER_177: like i'm like do you what you don't you're on the earth under your your bed like how is that a investment what what you buy is dirt you buy the dirt you don't buy air well i mean even think about

David Friedberg: this like in its worst uh example the stock market had inventory like amc a movie theater change his

SPEAKER_200: bed bath and beyond thing which we haven't talked about here but that whole manipulation that's been

SPEAKER_69: going on for the past collapse like meme stocks even in their worst iteration the most abused shorted you know group buying pump and dump scams there's you can still go to a bed bath and beyond and buy some soap and drapes you can still buy tickets to an amc movie there even if it's a hundred to one its value

SPEAKER_15: or 50 to one and it's being manipulated to all hell there's still an underlying company there where people work and provide value to consumers i guess right it's not like these things are trading on air if you build all this infrastructure to trade you know some ephemeral promise of something to come it's very very very very strange even private market we're talking about sale plan like when we made that investment we're like okay there's a couple of customers we'll talk to those early pilots there's some product here we can look at the product we could go look at the interface we can talk to the founders okay there's something going on here we can look at some financial statements we can look at

SPEAKER_49: some bank accounts we could do some kind of diligence the diligence on a cryptocurrency is like

David Friedberg: okay how many commits were made to this project and it's like oh yeah and then this guy created

SPEAKER_80: nine different personas to put commits in like what what exactly are you investing in here and then let

SPEAKER_105: alone trading futures on it's wildly uh ahead of itself it would be like us betting on you know this person inside of stanford or you know berkeley says i'm going to create a company when i graduate

David Friedberg: we're like great here's a million dollars and you're like what am i supposed to do this like yeah put it in a bank account and start thinking of ideas and write white papers that's what's happening

SPEAKER_18: a crypto i just right i just invest i just invested in your future i invested in your future right

SPEAKER_178: right yeah and again not to say that this won't turn into could turn into something it could turn

SPEAKER_05: into something but like when you look at and it probably will but it's imagine if in the early days of the internet people started like creating financial products out of uh the concept of tcpip it wouldn't mean that tcpip wasn't real and a valuable protocol and a way to interconnect computers but if but if somebody's out here making billions of dollars trading derivatives on tcpip then all of a sudden you start to think that maybe tcpip isn't the product in fact i am trading on margin

SPEAKER_49: now uh rss feeds with enclosures because i think podcasting is going to be big what these people forget about open protocols is they're open protocols anybody can fork them so that where does the value actually manifest itself it manifests itself on the application layer so let me explain what i'm saying

SPEAKER_105: here okay who's the biggest beneficiary of the rss opml attachment standard that dave weiner worked on not dave weiner yeah not the people who contributed to that it's joe rogan it's spotify

SPEAKER_15: it's apple podcast right it's us it's people who built either a podcasting application an advertising business a property call her daddy this week in startups whatever joe rogan that's where actually the

SPEAKER_69: value is captured so if you are making an open source decentralized product and then you're hoping to capture value and then you're saying the token's going to capture the value but the toe the whole

David Friedberg: thing if they were if the tokens were too expensive somebody could fork the whole project and start over from zero and then own it and make it proprietary in some way so i think people haven't thought this

SPEAKER_55: through um if i'm being totally honest now there is some there are some examples fried has right he was

SPEAKER_05: like great job creating this like totally open standard thing and there will be a bunch of them and i will financialize the out of them yes good job that guy he created a whole new product and that product

Jason Calacanis: is how to make money trading stuff that other people invented for free he's just taking a vig on

SPEAKER_243: people's belief that there's something here yes before we get to the ad it makes our team so happy to see our partners celebrate big wins and i was so thrilled to hear about this huge funding round

SPEAKER_105: for our partner odoo really great stuff from julian and the team especially in this crazy venture market it speaks a lot to the incredible product they're making and you know right now you've got a lot of sass apps maybe you don't need all of them check out odoo suite of business apps because you're going to save money and you're going to get more done with less effort using odoo means you don't have a bunch of different sass subscriptions weighing you down everything you need is already inside of

SPEAKER_171: odoo all you have to do is flip a switch and turn it on when you're ready and they'll only charge you for the apps you're going to use odoo has over 40 main apps and over 16 000 apps from their open source community we're talking about sales accounting marketing automation hr website builders and so so much more you can have one customer support contact all your data in one place and all of your apps will be supported by that same customer support team not 20 different ones and here's the best part your first app is free forever and odoo is offering a thousand dollar credit on your first implementation

SPEAKER_49: pack amazingly generous a thousand dollars right now odoo.com twist odoo.com twist i kind of liked

SPEAKER_01: the way howard lindsen framed it two fridays ago and people some people love that interview some people hated

SPEAKER_105: it but he just said it's more internet and i was like yep that's kind of what it is isn't it like we had distributed you know bit torrent and you know other uh kazaa we had these open source distributed computing platforms before it's just more internet blockchain just another database kind of a

SPEAKER_01: database that's slow and doesn't work very well but it does at least you know let everybody see the transactions and it's immutable and nobody controls it but you know i just wonder like

David Friedberg: the amount that's been invested in here's what i would like to see and this is an analysis we have

SPEAKER_49: to start thinking about how much has been invested into crypto by venture capitalists by the public where did that money go and then what money comes out of it so i'm going to say you know investors put tens of billions of dollars into this somebody must have the statistic of how much venture capital has been put just venture capital professional investors has been put into crypto projects okay let's say it's 50 billion okay let's say they own 20 of those projects 30 of those projects okay a third okay so now there has to be 150 billion for them to break even and to hit venture numbers there has to be 500 billion in other words you know like a google or a facebook or a tesla has to come out of this or 10 you know or seven ubers or airbnbs have to come out the other side have we seen one right coinbase

SPEAKER_05: you're still trading platforms exactly it's not a crypto project exactly the product in crypto is trading like that's what nobody wants to admit the big the biggest value creating product with obviously fantastic product market fit is gambling yes it's trading it's financializing a thing that only barely exists and is super nascent and making billions off of it and that is flipped that's just flipped usually when something has value is when you start trading in it correct when has it ever happened in history before that before a thing became the thing it could be yeah we started

SPEAKER_105: financially trading the crap out of it and making billions of dollars normally value is created in the world and then derivative financial products are created on that value yes so this home provided value to the family that lived in it this apartment complex provided value to the owner who had 12 tenants who became a millionaire and those tenants got value as well because they could find a place to live okay now let's bundle these together and make some sort of reit you know whatever oh this smart group

SPEAKER_49: of people in silicon valley decided to invest in 30 companies let's create a venture fund and a venture ego system where lps put money in and then something comes out because they found some value here right

SPEAKER_15: what we have here is no value has been created basically i mean unless you consider like some of

SPEAKER_49: the nfts valuable which i do i guess some are and then people have created i'd say 90 of the value has been in the financial derivative products on top of the 10 of value that's been created it makes no sense like and then even dark web transactions i mean that is valid but right but again i mean i it's just

SPEAKER_00: it's the backwards nature of this and i am not engaging in the question of whether fiat currency was also invested by the way and what backs the us dollar it's the full faith and credit of the united

SPEAKER_258: states that's what backs the dollar it's a lot of battleships and dudes a lot of battleships and nukes

SPEAKER_26: as we created this thing it could have a lot of value i'm not even arguing that it couldn't but it

SPEAKER_05: doesn't yet and because we have flipped the process we're going to make it even like we've actually literally created a system where it's going to be near impossible for bitcoin to ever become a

SPEAKER_197: currency because it's too valuable as a financial product and then here's the thing that's come out

David Friedberg: as regulation so now regulators are like okay what game are you playing over here right so we need to get involved in you created a casino in the sky to trade things that have no inherent value how do we even regulate this meshugana and part of this leak was that the fdic you know you hear fdic insured in those commercials like the federal deposit insurance corporation is supposed to backstop you won't lose your money if it's in a bank account kind of concept they issued a letter to ftx and five other companies

SPEAKER_105: that um and the agency demanded they take immediate steps to correct quote false or misleading statements on

SPEAKER_87: products being eligible for insurance protection in the letter the fdic said ftx us president brett harrison posted on twitter content that contained misrepresentations about deposit insurance harrison

David Friedberg: responded to her writing quote per the fdic's instruction i deleted the tweet the tweet was written in response to questions raised on twitter regarding whether direct usd deposits from employers

SPEAKER_105: were held at insured banks i.e evolved bank we really didn't mean to mislead anyone and we didn't suggest that ftx us itself or that crypto slash non-fiat assets benefit from fdi insurance i hope this provides

SPEAKER_87: clarity on our intentions happy to work directly with the fdic on these important issues so this is

SPEAKER_05: just a thing that keeps coming up is like some of these companies have seemed to suggest what was the other one was it voyager there was another one that got in trouble for seeming to suggest that if you consumer made an investment here made a deposit that that deposit would have protection right there are all these screenshots from reddit threads as some of these big you know companies have

SPEAKER_00: collapsed in celsius and things and they were like wait but they took our money they can't just it can't just be gone right and it's like yeah it looks walks quacks and acts like a duck but it's not

SPEAKER_269: regulated like a duck so your money's gone it's hard enough bonkers scenario the whole thing's bonkers uh everybody who's participating in this knows they're gambling from i hope the civilians all the way to

David Friedberg: the people running the casinos everybody knows they're gambling everybody's expecting returns that do not match the reality of returns historically so that's what makes me say

SPEAKER_49: anybody participating in this is going in knowing they're gambling i have sympathy for dopey people in the world who take their life savings and gamble it i also think that's part of like the lessons you learn in terms of being the sucker at the table that make you wiser in the future and i'm not saying the people running the virtual casino are not more culpable they are but let's be honest anybody buying

SPEAKER_15: something they don't understand because they heard about it at a cocktail party or on a reddit forum and they're trying to 10x their money when everything else in the world says expect seven percent a year in the stock market historically and you double your money every 10 years if that's the common wisdom

SPEAKER_49: and you think you're going to seven extra money a year instead of seven percent well i don't have too

SPEAKER_105: much sympathy for you i think this whole thing is going to be looked back on as like you know tulip mania 2.0 and then two or three interesting projects will come out of it right so definitely well

SPEAKER_05: 100 i think no doubt about it there will be products with value but right now there is like a gambling frenzy and all these things are chips and there isn't even any cash in the back room the sec and

SPEAKER_43: our government should have been more proactive on this i'm being honest but i understand their position

David Friedberg: which is the rules are here if you choose to break them then we enforce them we're not here to tell you how to innovate and so i think people took the innovation card and ran with it hey we're innovating we're doing something new and that's kind of how american society works like you know here's the laws read them go build what you want we're a free country you can try to innovate but i think a lot of these people their innovation was let me find a bag holder yeah let me and they knew it

SPEAKER_00: let me like create an investment be like as soon as right there's innovation and then there's the part

SPEAKER_05: where the sec could have been like huh you created an exchange you say for buying and selling and investing in a thing that is a derivative or a whatever like that's a security the end right like the sec still is not meaningfully the fdic is engaging on this topic more than the sec is yeah and that's the part that makes no sense it was so easy to create a parallel shadow banking system with no rules because the sec was like this isn't it it isn't innovation that's true it's literally turning the crypto industry into investment banking but without any rules they were like this is new so

David Friedberg: therefore the rules that exist in society don't apply to it and that's just not how society works right rules apply right and you chose to ignore them and the sec chose to let you ignore them they

SPEAKER_48: should have just gotten in earlier and just said listen not and then even when they went to build products it would have helped create products that certainty but here's the dialogue in crypto hey you

SPEAKER_15: know xrp they did a lawsuit against xrp we think xrp is going to win the lawsuit so even the crypto people when was the xrp lawsuit like three years ago yeah every even since then people are like yeah they're gonna win so therefore uh we can still break the rules i mean that should have made everybody go oh the sec sued xrp and they're saying it's a currency everybody stop what you're doing did everybody

SPEAKER_49: stop what they're doing no everybody suspended disbelief and to this day people suspend disbelief oh there was that lawsuit for coinbase hey these eight things that you were front running is a security

SPEAKER_15: or our securities and then everybody's like yeah i think they're gonna win that case i think the sec

SPEAKER_294: is wrong so like you know there's a there's a lot of knowingly ignoring this stuff

SPEAKER_243: mm-hmm listen masterclass is the best way to learn from world-class instructors at the top of their

SPEAKER_105: fields i love this product we use it in our household we've got a yearly subscription and they're amazing courses include my guy steph curry teaching shooting and ball handling legendary and former disney ceo bob eiger teaching you about business leadership and strategy that's a great course i've watched it and i recently watched chris voss a former fbi lead hostage negotiator teach the art of negotiation now you may have read his book you may have done the audiobook whatever those are great i love chris voss i've heard him be interviewed on podcasts but when he sits down and does a master class that is the pinnacle of him sharing information and it is so well done you're

SPEAKER_171: going to learn a ton each one of these looks like a movie the production value and the joy of watching these you're gonna really enjoy the aesthetics while getting all of that amazing information they have 11 categories with over 150 instructors now and the lessons are about 10 to 15 minutes long so they can fit into your busy schedule and you can get unlimited access to every single masterclass

SPEAKER_105: that's the big innovation here for 15 off an annual membership go to masterclass.com startups

SPEAKER_171: masterclass.com startups for 15 off according to wall street journal sources amazon is attempting to

SPEAKER_05: invest even more in healthcare it is evidently one of the bidders now for again this is wall street journal reporting at this point for the home health services provider signify health signify is for sale via auction it could be valued at more than eight billion dollars its technology provides in-home

SPEAKER_00: health care evaluations so its customers are like health plans governments employers health systems physician groups it has this network of over 10 000 in-home clinic clinicians and it's part of this value-based care model this is sort of an interesting evolution that's been happening in healthcare the idea that you as a provider should get paid based on the value you provide it's as opposed to the number of services you provide so you don't have to like overload people with 50 million tests that they don't need you actually like take the time to hone in on the right one and get paid for the value you provide for example the final bids are due around labor day so they come to your home and provide health care

SPEAKER_124: health care uh evaluations got it yeah so if you i wonder if that includes like having your blood drawn

SPEAKER_105: yeah i don't know if they can do that or not but that'd be great if they could i would i wish they could come what do they call that phlebotomist oh god yeah right mobile phlebotomy like why is

SPEAKER_80: i don't they have that like i would having to go to one of those clinics to get your blood drawn like

David Friedberg: come to my house i'll pay an extra 50 bucks or 100 bucks i come and take my blood every six months and then put it into some ai that's what i really want and there are some companies doing this but that would be really cool if you just had your markers done every quarter and they just told you over time what's happening and then you could have all that data so in the future if they figure something out they

SPEAKER_80: could go look at your 20 years of blood work and say oh yeah by the way that's what chloe said from

SPEAKER_05: the land b i had never heard that before when when we had chloe on from the land b and she was like

SPEAKER_00: oh you need to have your blood work done every quarter i was like what you do because it's like if you're taking a supplement you need to know if it's working or it was that was absolutely fascinating anyway so yeah i'm not it's actually kind of hard to find out and this is always an interesting pink

SPEAKER_05: flag like we as a team spent quite a bit of time this morning nick in particular and then i came in late we're trying to figure out exactly what signify does with these home in home health services and it's

SPEAKER_00: not super clear what they do yeah so maybe there's some phlebotomy i'm just saying but it's not 100 obvious what they do i think it does there is some they work with like medicare advantage and some other government-run managed care plans so they might actually do in-home care like provide that for seniors or other people i think they're doing a lot of senior point joanne yeah i think there's a lot

SPEAKER_196: of seniors that they're going in and uh checking on them um and seeing how they're doing so i don't know

SPEAKER_105: how that compares to um in-home care but this is evaluations so that's different but i can see this

David Friedberg: being a very big business for amazon and what a great company to take this on this is where when you have big companies you know we have this whole fear of big companies but sometimes when a big company takes something on like this they can take a 20-year approach to it and everybody benefits if you look at cloud computing and the benefit that's provided to society that anybody can create a startup and have access to this giant computer network and then instantly scale it around the world it's pretty dope you know when you think about it or any merchant can put their stuff a third-party merchant can put their stuff on amazon and have access to all those prime customers and fulfillment and distribution

SPEAKER_196: like those platforms have provided great benefit to consumers and so i really would like to see amazon

David Friedberg: challenge healthcare and i'm sure there's a third of healthcare services that can be amazon-ified to

SPEAKER_105: create a new term where it's just you know like a platform and it goes to the lowest cost possible

SPEAKER_87: like why not do that we're seeing it with drugs right with the two companies you interviewed on the pod

SPEAKER_80: yeah we need to take each of these components and then just make them cheaper faster and easier and

SPEAKER_00: more customer focused i mean that's what so right what is also like if you look at amazon's

SPEAKER_05: whole approach to everything it's done it's been this customer love this customer focus and granted that

SPEAKER_00: should manifest as like a redesign of their terrible website but uh at the end of the day it is about like providing people with a service that's easy seamless and that they love and we would all agree targeting back to chloe from the land b that's the opposite of what healthcare does in america right now like it is still i think a very open question what how amazon might actually do this and i think the whole foods acquisition and their attempt to like own grocery is a cautionary tale but it's i'm sure

SPEAKER_158: whole foods is selling more now than it was i'm sure it's grown more and sells more than it was it did

SPEAKER_72: but you know this is all about those pillars and amazon um we had uh ben gilbert and david rosenthal on episode 1530 and we talked about with the acquired hosts and some of the great podcast um we talked about the three pillars prime which we're all members of marketplace people selling stuff and third parties getting on there and then obviously cloud computing aws so what would the fourth one be uh brad stone has been on this podcast before friend of the pod who did the everything store and amazon unbound two books um she just wrote an article for bloomberg he thinks

SPEAKER_158: the advertising business isn't the fourth pillar because that doesn't have to do with consumers really right yeah the pillars as defined by bezos in his shareholder letter from 2014 were a core pillar this is what this is bezos's words quote customers love it it can grow to very large size it has strong returns on capital and it's durable in time with the potential to endure for decades

SPEAKER_12: so yeah health care really see health care yeah 100 whereas advertising is it loved by customers no yeah no you heard us ranting about what might happen if apple starts putting ads in our

SPEAKER_114: up in our business it's just too much oh dear god know thy brand is i think like a key piece of this although i guess netflix is doing it i guess everybody's just like let's go i mean just because

SPEAKER_196: they're doing it doesn't mean people are gonna like it but yeah amazon q2 aws revenue 20 billion basically i mean marketplace q2 online and third party 78 billion low margin obviously they kind of break even on that i think prime q2 subscription revenue 8.7 billion 140 bucks a year for prime so

SPEAKER_00: and that's high profit i think and to be clear like aws which is i'm sure high profit by itself is on a 79 billion dollar run rate more than like is is bigger you know compared to the marketplace business at 78 billion like marketplace business means e-commerce for those of you wondering

SPEAKER_332: right i don't know the marketplace but basically not like facebook marketplace

SPEAKER_196: yeah which is common for them which is common for them yeah aws the profit center marketplace loss leader aggregates a bunch of people at some point they could just turn the dial and i'm sure they will at some point when they kill a lot of competitors and we're all addicted they'll be like you know what let's start making a little bit more and they'll just turn that dial as i've talked about before the big companies can pick their revenue because am i going to change my buying behavior because it's two three four percent more money to buy an uber and airbnb or stuff on amazon no

SPEAKER_87: and certainly you know if you change it to 10 nobody would it's only you have to get to 20 30 price change to actually see consumers change their behavior under 15 percent consumers don't change their behavior just as a general number 15 is the just noticeable difference uh in terms of our perception as humans so yeah you know if you change the brightness of something or the hue of something or the sound level of something humans don't notice until it's above 15 as a general rule of them

SPEAKER_335: you can change prices 10 12 people probably won't notice so it's interesting bradstone predicted in

SPEAKER_00: this piece in bloomberg that either healthcare or home automation would become amazon's fourth pillar and it's kind of interesting because the two companies that amazon just bought confirmed you know setting aside these rumors are irobot yep and one medical do you think they've previously bought ring they previously exactly and they've got like obviously strong alexa penetration even though all she does is give me the weather and then annoy me by saying by the way and try to tell me all the other crap she can do but like i wonder if there's an internal amazon's very famous for sort of pitting things against each other and i wonder if they are pitting these two things right it's sort of like a a highlander like there can be only one fourth core pillar and they're trying to figure out

SPEAKER_05: internally and make them compete to the death to see if it's a home automation or healthcare

SPEAKER_48: i've never seen a chair or stool with five legs exactly but i don't see why they couldn't have five legs so the metaphor might no way be unnecessary murder each other it could be that

SPEAKER_158: but i think they're gonna i think they're gonna have a five-legged stool you know i think that's where this is going like i think they'll keep going until somebody stops them that's what i think and well that the question is do you want to stop them or not at this point you know this is where lena khan

SPEAKER_15: and our government has to think what's i mean healthcare sucks in this country if amazon wants to blow tens of billions of dollars trying to make it better do we want to stop them or do we want the government to be responsible of this or do we want the free market right and i think we want the free

SPEAKER_05: market to exactly we freaking do and healthcare is so vertically integrated and there are monopoly choke points all throughout healthcare that i'm sorry if this was the thing that lena khan tried to block amazon from doing i actually would be pissed as a consumer of healthcare the worst system in the

SPEAKER_120: world there's nothing to lose our healthcare sucks in this country yeah you know it's it's kind of like

David Friedberg: education as well like please let amazon or google get college accreditation and let them compete in that space right i mean this is where when you look at credits for schools right this is something i brought up on all in last week you you have the same people in atherton fighting housing and then also being against school tax credits what people don't realize is in california your little atherton community a little palo alto whatever it is they keep all their education dollars and make their own schools in their little bubble where they don't allow multi-family homes and then the town next to it east palo alto or milbrae or san carlos gets none of those dollars or redwood city but they have to have all the apartments as well and then you're against the tax credit but all your kids go to private school and you're not impacted by this i kind of have come around to parents getting a tax credit i know it's unpopular but i'm just thinking pragmatically if there's no competition well if i was a parent i

SPEAKER_49: would like to have the option of getting that 16 000 and coming up with my own solution if i didn't agree with the solutions that were provided by the government i think that's the same thing with health care like sometimes the government sucks at doing things and having competition might kick them in the ass yeah i don't know how you how do you feel about those school credits i i was torn on this

SPEAKER_72: issue for a while until i just saw like public schools not getting better so why not have competition

SPEAKER_00: when i'd have charter schools why not have choice it's like a yeah i know it's a real this is a really tough question for me because i get very frustrated with the lack of innovation in schools and all the different ways that they are um stuck and don't want to change but also like every solution that we come up with including a tax credit sucks money away from public schools so it's this sort of like it's this chicken and egg argument about schools where we we cut like if you gave me if you paid me you know eight dollars an hour and told me i had to do 11 different jobs then you would be like you suck at your job you're fired and i'd be like yeah but you paid me eight dollars an hour and give me 11 jobs to do and that's kind of what we've done to public schools like we've stripped away funding more

SPEAKER_178: and more and more like the pay is really low right so we've created crappy public schools and now we want to create all of these fixes that would just continue to siphon money away from public schools

SPEAKER_26: and we don't actually know if they would work if we just funded them properly uh and they now have

SPEAKER_87: raised the prices on uh teacher salaries and still can't find people so it's like my view of the world is at this point having watched us up close it's if you don't have competition you wind up having

SPEAKER_105: the product becomes less crisp you know it becomes less innovative and we need innovation so it really

David Friedberg: is that simple if we had competition in schools it would be there so you could still all these other things can be true we're underfunding it whatever well if you without competition there is no i mean

Jason Calacanis: there could be inter-school competition like i agree with you and also schools are a complicated

SPEAKER_00: issue but i think you're absolutely right like at some point you do have to be pushed to do better and

SPEAKER_05: one of the one of the best possible ways to get pushed is somebody else coming for your job they're

SPEAKER_87: coming for that 16k because i have kids in public school uh and private so i have both of these things and i watch it you know like and i'm lucky enough to live in a community where we're overfunded you know not just similar to atherton and the public schools are unbelievable they're better than most private

SPEAKER_49: schools in in other areas and i can see in the public schools they're like hey we need your child to cut during the pandemic they're like we need your child to hit this many days whatever and i was like well i'm gonna do my own school situation and they were pressuring me and i realized oh they

David Friedberg: don't get this like 17k or 20k from the government right if my kid doesn't hit these things so they

SPEAKER_43: have in their minds it's we need your kid in school okay that's healthy right funded for butts and

David Friedberg: chairs it's like exactly what well and then if they were losing butts in chairs because parents

SPEAKER_196: had a choice then they'd be like well we got to make this more attractive to parents and so that's

SPEAKER_241: where competition comes right but they are on a limit they are on a fixed income so they can't that's

SPEAKER_00: what i'm saying that's the chicken and egg problem with schools is like they're on a fixed income because governments have said this is how you get funded and this is how much you get the end like you yes you can do a little bit more with less but like thank you bill gates by the way for creating

Jason Calacanis: common core and a standard that they all have to teach to so they actually can't innovate even on curriculum in the ways that they would want to right so like if you it's not a free market schools are not a free market that's why i'm saying the competition thing is a little bit flawed because they they will never be able to compete on the same playing field i think they would then be forced to

SPEAKER_14: compete and it turns out but who is they they would then be forced to like change state laws all across the country

David Friedberg: laws all across the country because what would happen is you would have parents going to this private this private school with their 16 17k tax credit for a school voucher and then the public

SPEAKER_105: schools would say hey you know look at they're all picking that one that has this innovation we need to have that innovation as well and boom and then they would be like you can't have that no the state

SPEAKER_87: would have to change that because then they would like okay the schools are not competitive they would have to look at that issue of why but it turns out right now public schools are paying like 50 percent more than private schools so that's the other thing you're looking at oh they pay teachers

SPEAKER_80: more for sure at public schools yeah paying teachers like i was looking at public school salaries in california 80 000 100 000 120 000 and that was that's after that's after a decade or

SPEAKER_197: more like yeah right berkeley's starting salary according to one of our noties is 58 000

SPEAKER_58: right i mean what 10 000 more than 10 000 more than vox's starting pay

David Friedberg: just so you know comparing to journalism because i happened to look at these because i was looking at the inside salaries which are all 65 to 80 000 you know for analysts and stuff like that and i was like what is vox paying so 48 000 is the starting pay of vox you know the whole thing we were talking

SPEAKER_158: about last week yeah well then it goes up from there but you know i think you know if you have five or ten years experience i have a feeling being a teacher at a public school pays more than being a journalist right now um at like a vox i'm not singling on vox they just have to be i mean i'm sure buzzfeed has the same pay scale because they also have a union and gawker i think did

SPEAKER_87: before they kind of got sold for parts so you put it together a public school teacher with a couple of months off i think makes more than a journalist on average and you know in a major city interesting

SPEAKER_05: right which is fascinating to me i guess it is fascinating that's also like only one of the many structural problems of schools to be clear like there's a there's a ton i think i to be honest i think

SPEAKER_00: before states changed the rules to allow public schools to compete on a an even playing field all the schools would close i really do i'm like i don't want to be a downer about it but like it we

SPEAKER_05: everything about that structure that infrastructure is just a disaster it needs to be broken up

SPEAKER_87: the unions are a bit of a cartel in new york bloomberg was trying to break the union there because they were keeping the worst teachers employed they you couldn't fire a teacher like the level of

David Friedberg: debauchery and insanity in new york like it took years and they had a building of the worst teachers and those teachers couldn't be fired in new york so they put them in a building where they just sat at desks and did nothing all day they just it was like a no-show job but they had to show up and sit in this place yeah and there was nothing for them to do but they couldn't fire them it is possible for

SPEAKER_80: a union to have too much power right it just like that's possible for people to not have enough power

SPEAKER_196: and need a union it's possible for a union to have too much power and then you know you don't have

SPEAKER_03: the ability to fire people i mean um who are just really bad at their jobs all right listen we have

SPEAKER_395: some m a we can touch on here startup m a critical part of what we cover here so maybe let's go to

SPEAKER_241: that yeah small companies still getting bought and ebay still making moves oh wow ebay who knew yeah

SPEAKER_05: ebay is uh acquiring an e-commerce platform for trading cards called tcg player for 295 million

SPEAKER_00: dollars ebay's uh current financials its market cap is about 25 billion dollars uh 2021 revenue was 10.4 billion dollars it actually had a little bit of a coveted bump as well net income 252 million dollars tcg player is uh serves individual users and businesses and it's like gamified e-commerce so the more you sell the more new like abilities you have on the platform which is kind of interesting um

SPEAKER_208: yeah trading for people who are selling like pokemon cards and like magic the gathering cards all this

SPEAKER_05: kind of nonsense pokemon sports cards big time yeah evidently trading cards among all of you know i mean

SPEAKER_00: that there was that kind of whole entire alternative asset boom you saw like sneakers and wine and

SPEAKER_130: fractional ownership and art um and trading cards was a huge part of that so what is awesome is that ebay

SPEAKER_385: was like oh during the pandemic everybody got really into trading cards and then a year later bought

David Friedberg: a company that trades well here's the thing you know when you have a vertical this speaks to verticalization right yeah ebay is a wide platform sure people are trading pokemon cards there but is ebay and now those buyers what's more compelling to them a vertical site where you only sell

SPEAKER_49: cards and then every card has a chart and they've got a database of every card they say hey this card is a mint condition this is class b condition class c whatever it is and we'll certify the cards and we know the cards and we can show you the price of that card over time in a chart which is what this tcg player does they just can build an experience where a hundred percent of the real estate on the website is dedicated to the needs of card traders now you go to you compare that to stock x which is just sneakers okay ebay sells sneakers but it's ebay validating and saying hey these are the right sneakers and do they have the database and they have that dexterity and so you want to as an entrepreneur eventually be able to do everything but having specialization is a an equally valid path and so what you're seeing here is ebay you know ran the table on all auctions but then people started chipping off verticals and this was a a play that airbnb did there was a section called couch surfing it

SPEAKER_158: probably still exist on craigslist we can pull it up and show you if it does couch surfing is where

SPEAKER_87: uh joe uh one of the co-founders who just left um airbnb i think found the idea and he famously

SPEAKER_105: shared the email that he sent to brian saying hey i think we could rent our apartment to keep our startup alive that's how good that idea was and that was but one little section of craigslist another little section was buy and sell stuff right which became facebook marketplace or even ebay then there was also

SPEAKER_13: uh like dating casual encounters and that became tinder yeah what was the other one missed connections

SPEAKER_406: i was going to the dating thing remember miss connections oh that was so sweet that was some

SPEAKER_224: of the best reading on the internet i feel like yeah miss connections could be a screenplay like i

SPEAKER_408: saw you on the bus you were wearing doc martens i was reading this i was reading fahrenheit 50 i was

SPEAKER_412: listening to everyone but the girl you were reading william gibson's virtual light romancer totally we were on bart i was tripping on a micro dose of yellow sunshine mushrooms you had a lime green ipod and i

SPEAKER_229: was on my way to my to pick up my bernie man trailer

SPEAKER_422: i was going to my bikram yoga class sweaty i was coming back drinking my phil's cold brew

SPEAKER_412: you were polishing your blue bottle chicory

SPEAKER_201: the noties are saying that uh miss connections now still exists on reddit thank you for the evening of

SPEAKER_13: entertainment done and done so anyway congratulations to the founders of this yeah that's great and i

David Friedberg: think it's a smart move and this is what you see in m a molly some startup carves a niche out of a big company then the big company ignores it and is like we can do it ourselves but they out they get out executed they can't because you're the ceo of ebay you've got 150 categories autos this that trading cards shoes music you know autographs whatever you and you try to get somebody to head up the creating card and they're a schmuck and they can't make it great and you're like but look there's a startup doing it better than us we're ebay we have more resources than them and the person's like yeah

SPEAKER_43: i'll do that and then the person doesn't show up for work or they're just lame yeah and you get your ass

David Friedberg: handed to you ebay can get their ass handed to them in a category and then ebay has no choice but they're like jeez look these guys are gonna run us over if we don't buy it and that's what happened

SPEAKER_00: here and it's a great um this should be a good note for vc sunday school too because you talk to a lot of companies and it's like why wouldn't amazon right i always you always have that question why wouldn't google just build this why wouldn't amazon just build this and most of the time the answer is

SPEAKER_05: we just we have just enough of a competitive edge that it would be easier for them to buy us

SPEAKER_00: because they weirdly a company will never plow 300 million dollars into building a trading cards vertical vertical but they'll take it out of a different budget and buy the company and you know

SPEAKER_01: what the key factor is that you can look at to determine this as an investor if they're going to

SPEAKER_179: win yeah product velocity yeah so here's the thing nice who's going faster this uh tp whatever tcg

David Friedberg: player is tcg player adding more features that delight customers or is ebay now if you look at a company like facebook my lord you know zuckerberg locks the doors and says we have to be better than snapchat instagram tick tock and their product velocity has always been faster than anybody in the industry amazon incredible product velocity they say we're going to release the kindle you know amazon fire tv tablet or amazon fire phone ring whatever it is they move faster faster faster

SPEAKER_105: and that's when you can tell the big company now ebay obviously did not move faster than tcg player

David Friedberg: so if you're a founder a capital allocator you must accept that you have to out hustle the big player in the space and go faster if you look at coda and notion they're going much faster than google or microsoft in that document creation wiki space right does it mean that microsoft and google aren't gonna wake up

SPEAKER_105: one day and go you know we need a competitive product here they will but i don't think they're

SPEAKER_49: going to catch up because the product velocity if you look at coda notion slack has been extraordinary and then slack got sold and now their product velocity hasn't been as good as it needs to be yeah and now microsoft teams can catch up to them so this is where product velocity how quickly you ship features matter i am obsessed with this in this company and this podcast i'm always thinking about new features how fast are we going it makes people disturbed sometimes unless you have the right people and you explain to them what you're doing we have to move fast and then some people molly you may have witnessed it firsthand are like well wait we just decided this and now you want to decide that and it's like we got new information we're obviously going to need to go faster here because look there's other people going faster than us in this direction we need to be competitive and that relates to the school's discussion or the healthcare discussion we should have product velocity in education and healthcare sucks where does product velocity thrive in small teams and startups so if you're in a small team accept the fact that you have to run not walk or jog that is the job of startups if a startup

SPEAKER_15: is walking or jogging and they're lollygagging don't invest don't work there quit and if you're

SPEAKER_444: a lollygagger don't go to a startup go to ebay yeah go work at ebay lollygag at ebay yep that's

Jason Calacanis: for lollygaggers say lollygaggers again just one more time i can't take it anymore too much

SPEAKER_178: why lollygagging who you know who's not lollygagging not even a little bit uh tell me launch accelerator cohort 25. oh right yes how are those interviews going we just wrapped up uh the accelerator number

SPEAKER_00: the 25th one which is bonkers and so i've been interviewing the the founders and so we've got one today i'm interviewing launch portfolio founder arjun shokin he's the ceo and founder of a company called suede s-w-a-y-e-d this is one of those companies where when we were talking to the founder nick and i were basically slacking back and forth like i love this business this is genius this is so up your alley because what suede does is takes your customer journey in a hospitality setting like a hotel you the customer opt-in to this uh you know sort of like membership loyalty thing they shape and map your customer journey meaning the hotel will you know pay you in some way to take in a ton of user movement data and then they use that data to make the hotel or the hospitality experience like way more delightful and way more aman level and i'm like thank you but it

SPEAKER_120: doesn't have to be at expensive hotels it's for everywhere so imagine you go to a hotel so good

David Friedberg: you know um opt into using this software um you have the app or whatever they know that you went to the gym and then they send a fruit plate or they offer you uh a protein smoothie to your room and they text you and say after the gym would you like to do this now in a great hotel they're monitoring your movement just because there's staff around so the staff says hey you know guest calicanis in room 40 a guest miss molly wood in room 30 is at the gym right now uh this is a good time to turn over their

SPEAKER_105: room we saw them leave their room we saw them go to the gym let's go turn the room over uh also this

SPEAKER_158: would be a great time to offer them again uh you know this protein smoothie or maybe they want to

SPEAKER_49: get a massage later and upsell them on that and and this is if you've ever stayed at some of these nice hotels like in amman um you know you you go out for a run when you're coming back they're handing you a bottle of water and a a cold towel that's always like so refreshing so that's amazing the first time i ever stayed at shutters on sony's dime when i worked for sony for a year i came back from a run and the guy handed me a cold towel of water and i said oh how much does it cost he's like it's complimentary you're paying 400 for the room in so many words and i was like oh can i get two bottles of water he's like there's a refrigerator right there you can take as many as you like sir and i was like i'll take two and he said by all means sir take two and i'm like this cold towel i was like wiping

SPEAKER_00: myself with the cold towel wait yeah so imagine having that automated throughout your entire hotel chain so that everybody can experience a version of that service because they have opted into it

SPEAKER_05: from a technological perspective because all that stuff is there throughout the hotel right the the room

Chamath Palihapitiya: key swipe the swipe to enter the gym we need this that flow you're flowing around the space and then i

SPEAKER_467: come bring you the good stuff green smoothie i bring you the tequila smoothie okay banana avocado and uh

SPEAKER_470: the don julio you can you will never smell meat in your room rivka there will never be a meat smell

SPEAKER_467: everything you flow for vegans david friedberg is on the board we've decided if you want to live the flow

SPEAKER_472: lifestyle no meat no place no everything that would actually be that would be great you imagine if

SPEAKER_00: they had vegan only flow places i mean for the for the climate conscious out there that's actually like not the worst idea people would totally go for it um anyway super interesting it's a it's a great business it's a really interesting interview uh arjun choking coming up right now so the launch accelerator just completed its 25th cohort i am going to sit down with some of the founders over the next few weeks to dig into their businesses up today arjun choking is founder and ceo of suede at suedeai.com

SPEAKER_26: welcome margin hi molly thank you for having me of course thanks for being here and for you know being part of our cohort what i'm going to start with the easiest question of them all what is your

SPEAKER_478: what's your company do yeah so suede uh we map and shape customer journeys and hospitality settings so before suede i was working for my family business we own and operate hotels and we were developing a project here in la where we had this key question of whether we should put a pool in this location or not and i think we really quickly understood we had no idea of what people actually did once they arrived on property so i ended up making the decision by climbing on top of a parking structure spying at a neighboring hotels pool and seeing if anybody was using it that day but i think what we identified immediately was just we had no idea of what people actually did when they arrived at this physical location and if we lack this knowledge then we would be guessing at every level of operations ownership and even development and so we started suede early 2020 to see if we can address this issue and

SPEAKER_483: that's we've been doing it ever since so how do you sort of productize that problem absolutely so i

SPEAKER_478: think you know what's great about hotels is they have an existing infrastructure and data collection that really enables this so they're capturing massive amounts of data in terms of who their guests are how much they're spending during their stay loyalty statuses and different ways to segment people and on top of that they have these very robust wi-fi infrastructures that allow us to use the data that device is paying off access points to start building a knowledge in terms of where people are spending time and money within this physical location so for all intensive purposes after a guest opts into a enhanced experience on property we're able to link their mobile device to a central profile that exists within the property management system of a hotel and that's this link is what enables us to understand who this device is within physical space and then based on you know where they're going on property their device pings with access points where they're spending on property real-time you know activities such as transactions or changes to the reservation we can start building together a really cohesive understanding of how this person is spending their time and money at this physical location and this is kind of the core data set that we're using to you know enable a bunch of

SPEAKER_485: operations and also eventually smarter decision making above property i never knew that hotels were

SPEAKER_00: this dialed in i mean it sounds like you're saying that there was a sort of a built-in opportunity for

Jason Calacanis: this at hotels the whole time but nobody ever pulled it all together and obviously asked the guests for permission which seems like the important part of what you're doing correct i think you know there's

SPEAKER_478: just huge issues that hotels in particular face in regards to just bandwidth and skill set so i think the on-property teams constantly overwhelmed with their ability to you know gather information access systems create insights and then drive action and i think you know that you know problems kind of just increase since the pandemic with lower head counts across the board and there's not really a skill set to go into these you know kind of complicated systems which are collecting all of this data and then asking kind of an hourly employee to go in there and you know go through data and then come up with actions out of it it's kind of out of the question so i think you know we've identified this opportunity where there there was this existing infrastructure so it's a key win for us that we don't have to we have to tell you know hotel operators and owners install a bunch of new sensors because that i think

SPEAKER_485: that's a losing proposition we can really just be a purely software driven solution and drive value for

SPEAKER_26: everyone do the customers who opt in get anything in return absolutely a lot of champagne in the room

SPEAKER_478: yeah no i think it ranges and i i think it ranges in the type of property as well um you know some of our four-star hotels it can be as simple as you know no coupon attached to it we know that you're a business traveler and you're in your room at 8 a.m we'll shoot you a message just about the breakfast available on property and then we can measure hey that these people spend 50 more on breakfast over the course of their stay and so i think what we've identified is guests especially in hospitality settings are eager to share who they are so they get treated better and differently and i think that you know the more times you stay at a place the more tired you get of explaining to the front desk you've been there before so i think you can create this really automatic and you know non-human driven way of recognizing previous behavior and creating these experiences and that can range from a free drink to an upgrade to you know at one of our more higher end hotels we're actually creating a white glove experience where we're messaging staff to surprise and delight guests so like leaving a green juice in their room if we know that they're health conscious got it so that's the shaping part there's the

SPEAKER_00: collection the data collection part that benefits the hotel and offers them insights in terms of

Jason Calacanis: what they can do to improve you know get increased revenue and improve the experience but then there's also the guest side where they're incentivized to spend more or keep coming back yeah absolutely

SPEAKER_478: and i think you know what's key for us is this isn't a foreign concept to hospitality um you know back in the day in the 90s prior to the married acquisition ritz carlton was you know highest end in terms of their ability to increase lifetime value of their guests and they used to run this program called mystique which was a very manual process of gathering and acting on data so you would drive up to a lobby the valet guy would see that there's you know golf balls in your car he'd enter it into the system called mystique and then the next time this guest walked by the concierge they would recommend tea times and it created this really magical experience of you know gathering and acting on data but it was really dependent on you know employees and back then they used to have one employee per guest and you know now they have you know six guests per one employee so it's you need to use technology to kind of make up for that experience gap right how do you make money so we've adopted a simple sas model in the early days um and i think you know we price based on how hotels are used to purchasing which is a per room basis and so we just keep it very simple um and that's what's going to allow us to scale to the first 10 million or so where we price you know based on the category of hotel and the number of integrations on a per room basis and at our current level of pricing we would just need to hit on average an average size hotel about 128 hotels and so you about a thousand to hit 10 million um but i think really on a long term basis we view this initial phase as a as a way to build intelligence on behavior and physical spaces and use this data set to inform smarter decisions above property and beyond and so to hit a hundred million we really want to incorporate a data as a service model where we're essentially you know equipping large decision makers with large portfolios and even the brands with data in terms of how different segments of people are using and engaging with space and then making those kind of multi-million dollar decisions such as pools and how you're allocating budget on a development or how you're allocating operational efforts um with you know the status set which is very valuable i just

SPEAKER_489: really want this to work i just really want hotels to be psychic at every level like do you see this

SPEAKER_478: as something that is applicable to hotels at any price yes absolutely i think it's a no-brainer proposition for hotels because for the on-property team we're driving you know without staff incremental revenue and guest experience so for the hotel it becomes a no-brainer from a guest perspective they're receiving a more personalized and better stay on property and then from the owner they're gaining this visibility that they haven't had previous access to and we've spoken to the largest companies in the space and you know they are similarly reliant on intuition and past experience when making large decisions because they lack this fundamental knowledge of the guest journey on property and i think you know every time i stay at a hotel i do get tired of explaining to them i've been there before or i see you know a space that has no relevance to anyone and sits empty and i think you know every time i see that it makes me sad because i know there's a smarter way and so it'd be better and i think you know one thing that's been interesting is we've seen that it's not just hotels that this is resonating with we very recently were approached by austrian airlines looking to create you know a hospitality experience at the vienna airport and so for us what's interesting is the points of kind of integration are very similar to hotels with

SPEAKER_485: the central reservoir of data and you know a mobile application and access points and so i think this push for personalization and physical space is going to happen in tangential environments as well

SPEAKER_00: and then last business model question the the white glove product sounds a little bit like consulting where you're telling hotels you know what to do and what to put where is that going to be a

SPEAKER_229: core part of the business going forward and how do you scale that yeah so the white glove experience i think

SPEAKER_501: just to clarify is you know it's we're using the same mechanisms and interacting with the guests

SPEAKER_478: right so in this in essence is instead of messaging a guest during their stay we can message a you know a manager or an employee who similarly has a device connected to the access points on property

SPEAKER_485: and so if mr so-and-so walks into the lobby you can message a staff member instead of mr so-and-so and you could say hey why don't you walk up to him and kind of create this experience for him so i think it really for us it's not a lot more in terms of customization i think we really look at

SPEAKER_478: hey the core product is this data set in terms of guest journeys on property and this data set can be employed and deployed in many ways whether it be engaging with guests directly engaging with staff improving operations or experience or even above property making smarter decisions based on benchmarking

SPEAKER_00: in markets love it for the record the only two things i care about are a coffee maker and a bathrobe i can just put that in my profile now we're good to go arjun shokin is founder and ceo of suede which you can find at suede s-w-a-y-e-d-a-i.com thanks so much arjun good luck thanks molly

SPEAKER_505: all right everybody what a big monday remember remember remember if you would like to be featured on

David Friedberg: this program come to the launch accelerator we interview every company that graduates uh here you get to have an interview at molly uh launch accelerator uh you can just go to launch.co and

SPEAKER_196: apply we invest 100k just like you know tech stars my combination or whatever and we spend 16 weeks with you helping you build your company interesting your investors and we follow on invest in probably

SPEAKER_05: 90 of the companies ourselves so pretty great yeah it's a fantastic program uh we also have a fantastic week coming up we're super excited that we're gonna have sebastian maliby the author of the power law

SPEAKER_00: the book that every it's what did they call mfd fmf doom he was like your favorite rapper's favorite rapper the power law is like your favorite vc's favorite vc book right now this is the one that the whole industry is has been obsessed with and we're really stoked to have him it's just a great

SPEAKER_105: overview of like 12 great moments in the history of venture so i read it i knew 10.

SPEAKER_158: i experienced six of them up close like i knew five or six of them having been either in the room or adjacent to the room where it happened and knowing the principles but there were three or four i never knew and i'm in this industry my whole life so that i thought it was like a very good book and i'm i

SPEAKER_72: actually had our entire staff read it and that's going to be our book club in a couple weeks but we're

SPEAKER_05: gonna have the author on uh of the power law gonna be great and then a really great week for another crypto round table i'm excited about this one yes so we'll have sunny back and vinnie lingam

SPEAKER_01: back sunny madra uh sandeep because they had such a great time and everybody the show broke out so

David Friedberg: we think every two weeks we're gonna do a crypto round table till we figure this thing out and so

SPEAKER_105: molly will join me for this one and we'll have a lot of questions for our two experts including what cryptos would they buy at this point if any if any

Jason Calacanis: benny lingam still owes me 300 bucks from getting me kind of drunk and convincing me to buy solana

SPEAKER_14: at the all-in summit oh there you go just saying it's gonna be all right it's gonna be an awesome week great weeks uh so stay tuned we'll see you tomorrow bye