SPEAKER_00: when stripe goes public those distributions happen that's when the good times start to roll again why well because people will have renewed faith in the venture capital industrial complex this venture capital industrial complex people don't believe in it right now SPEAKER_03: because they haven't seen the exits and so when you have a couple of years of very few exits now people start to say well maybe there'll never be one again SPEAKER_00: they they've literally become so pessimistic the boston celtics will never win a title again SPEAKER_05: we traded kevin garnett or whatever and then all of a sudden hope springs eternal and they're back in SPEAKER_07: the game and they win a championship 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 addio a radically new crm for the next era of companies head to addio.com twist to get 15 percent off for your first year and cla innovation takes balance clas cpas consultants and wealth advisors can help you get from startup to where you want to end up get started now at SPEAKER_12: claconnect.com slash tech all right everybody welcome back to this week in startups i'm jason calacanis i SPEAKER_13: am a podcaster and early stage investor here in silicon valley and he's alex wilhelm he is a career SPEAKER_14: journalist and database analysis s 110q geek yes yes sir and today i'm also a construction and housing SPEAKER_18: tech startup expert so i spent a whole bunch of time going through and dozens and dozens of community submissions for the show today so awesome i know a whole lot about that well you know in the area of SPEAKER_12: startup land there are some verticals which are kind of like the siren song you know the rocks on the beach uh you know and um certainly education health and construction are way up there just you know it's SPEAKER_14: a big prize health care everybody needs it housing everybody needs it education everybody needs it like SPEAKER_12: this is 100 the tam is 100 of humanity problem is in some places uh this um what's the word regulation SPEAKER_14: the government will control these things uh yeah and for good reason you want everybody to get an SPEAKER_12: education great jack uh hey you don't want people building unsafe houses uh you you may not want your neighbors building something ridiculous next to your you know in your charming town i get it i'm not like SPEAKER_14: naive here um but yeah they have a lot of friction there's a lot of headwinds there's a lot of SPEAKER_28: yeah complexity that's hard to unspool especially about who's paying in education districts versus parents and then in healthcare insurance companies versus patients and then in construction uh lenders SPEAKER_18: builders manufacturers blah blah blah blah it goes on and on and on there's quite a lot there uh but jason the good news is that you and i not only have twist 500 today on the show we also have news about stub hubs ipo getting pushed back we have news from open ai about where they are in their progression towards building agi or what we kind of consider to be agi and we also have a little note that a SPEAKER_30: consumer app that everyone loves is changing up his business model so lots to get to today where do you SPEAKER_12: want to start well i you and i both love a good ipo story uh love a good s1 and let's face it m a is on the rocks a lot of people been asking me why is silicon valley you know uh maybe embracing the the SPEAKER_35: right a little bit and i think the reason is um i did a guest appearance on a show called pirate wires i don't know if you know the independent publication pirate wire i'm familiar with it SPEAKER_36: it's it's um who's the guy mike solana mike's i don't know mike at all other than that i like a little SPEAKER_05: bit of a uh iconoclastic punk rock publication reminds me of the zine movement back in the day um you know and so i dropped into their pod and and then i had wired email me they want to know why is silicon valley tilting a little bit right and i'm like like most things in life right uh people are SPEAKER_12: driven by status power money sex pretty much right like these are the things that will drive humanity SPEAKER_14: space hey you know when you look at money uh the the big part of our ecosystem is m a most companies do SPEAKER_05: not ipo most companies shut down and then some a large fat middle of the long tail uh have some level of m m a and so when you take m a off the table i think that's why a lot of people are starting to lean right hoping we can get lena con out and get somebody who's pro m a right uh pro letting these SPEAKER_12: mid-market things happen and so when we see an ipo man that's dpi that's you know venture capitalists getting to cash out teams getting to cash out uh or having some liquidity as they say in the business SPEAKER_05: and then maybe be able to do some distributions so that you can invest in the next generation of startups so these are desperately needed stuff hub has been around for well over 10 years come SPEAKER_18: on oh it's it's more than 20. but on the point about why people are tilting to the right this is not just a silicon valley point although i think we've seen it because a lot of folks in tech are more chatty than other ceos and investors um david uh zaslav the ceo of cnn's parent company said at sun valley this week i'm just going to quote from bloomberg here asked about the upcoming SPEAKER_47: presidential election zaslav said it mattered less to him which party wins as long as the next SPEAKER_18: president was friendly to business quote we just need an opportunity for deregulation so companies can consolidate and do what we need to do to be even better so i think i think the point here is people are trying to find a a moral or social issue that's driving this but i think really it's um they don't want corporate tax rates to go up and they would like to have uh lena con not looking over their shoulder every time they want to snap up a smaller company and i wonder if they're gonna get that under SPEAKER_51: trump we'll see there's been an interesting shift in some of the conservative christian right against SPEAKER_52: business so that'll be an interesting thing to watch yeah anti-business is a pretty tough one uh you can take a look at europe and where that's gotten them um you know you you can increase quality of life SPEAKER_00: uh for the average person and then decrease competitiveness on the global marketplace and that's really um you know we talk about the game on the field often in our industry SPEAKER_14: the field is now the planet we talked about work and the work arbitrage going around the planet yeah the same is true you know with this jurisdiction jurisdiction shopping as it were in a business sense not a legal sense but in a business sense you can pick where you put your company you can pick where you put your uh venture capital dollars and so the you know how to say this delicately you know the the more you gunk things up and the more socialist you get um and you know there's there's beautiful things about socialism you know i think it's absolutely fantastic that SPEAKER_35: you know people get uh maternity paid for by the state or paternity you know uh you know getting to take off when you have a baby i'm totally fine with nursery school being covered for by my taxes SPEAKER_55: right so some some of these things seem obvious and fantastic but man if you go too far you're going SPEAKER_35: to lose that next ipo you're going to lose that next great company but let's talk about stub hub here SPEAKER_57: 20 it was founded in 2020 you're right there are two thousand i'm sorry founded in 2000 this thing SPEAKER_47: though has been a bit of a hot potato right yeah so i was just going back through stub hubs history SPEAKER_18: prepping for today it's been sold kind of twice most recently in i think it was late 19 early 2020 when it kind of merged with the company called uh via gogo for about 4 billion now the company had been rumored to be considering an ipo in 2022 at a roughly 12 billion dollar price tag that got put on hold for whatever reason and now people are reporting that the company is thinking about a 16.5 billion dollar ipo very exciting to your point people love to see a big deal however it's been pushed back until after labor day so september is now the time frame and i i wanted to bring this up not because i just wanted to bring a piece of bad news to the show but i think we talk a lot about the exit market here and to see a company make this choice and have it leak in the way that it did to me shows that people are still very much concerned about valuations and the market being quote choppy if they're going to pursue an ipo so jason to me this is just indication that the caution we have seen is going to persist for the next three to six months at least on the ipo front which is or such a bummer yeah and this is SPEAKER_12: a mid-market company right stub hubs revenues hundreds of millions of dollars this isn't like a giant company i think it's in the hundreds of millions um and they were going to do a direct listing if i remember correctly and so you know it's uh and that and that via gogo is is another lesser known ticketing hub but these are all up against ticketmaster right this is the 800 pound uh gorilla and so yeah and things get pushed back it could be summer doldrums but the SPEAKER_14: market keeps hitting records you know this is one of the topics we did on all in uh this week as well was just macro yeah i mean this is one of the most um peculiar moments in time because you have so many people feeling like the economy is bad even though record low on insure uh record low unemployment real wages rate rising and uh inflation getting really tampered down we had a great inflation print this SPEAKER_35: week and cuts are coming apparently that's 80 90 chance of a cut in the fall or 90 plus chance of a rate cut in the fall so in the stock market hitting all-time highs over and over again so people keep making excuses of why this economy is bad or good really does feel like consumers um you know maybe feel it when they go to grocery stores and it's an emotional thing like it's it's pretty palatable when your happy meal costs 12 bucks versus six or seven right um and maybe when you have a variable interest mortgage or a variable interest loan payment so i do understand that there's a group of people who feel this very acutely i don't want to be like um clueless well let's let's be a little SPEAKER_18: mean about it i mean i've always been very confused why gas prices are such a big deal because it's never been a huge chunk of my household expenses and then it was explained to me that that people tend to be a bit more over levered on their car purchases than you and i might expect them to be longer loan times higher costs cars are expensive these days and so people often end up with a car they can barely afford and then gas prices go up and suddenly just running that vehicle makes their entire household budget stretch and that's why those are so directly linked to like consumer happiness polls and such and so when we think about how the economy is doing i mean our our equity holdings have appreciated but if you don't have any how much do you care that today the dow jones industrial leverage did hit a new all-time intraday high you and i are like sweet free money but you know so to me i get both sides of this picture but i don't see a reason why strong companies can't put SPEAKER_74: on their big boy pants and go absolutely do a big boy press conference do a big boy ipo let's go SPEAKER_47: yeah i mean just do it i mean do you think that it's going to be that much better in a couple of months there might be a rate cut but as you pointed out to be on twitter yesterday the day before priced in SPEAKER_73: it's already priced in it's all priced in it's always been priced in it always will be priced in SPEAKER_14: there are really smart people who operate in the global casino known as the market so this idea that nothing is going to be uh it that's it's not priced in is crazy uh ticket masters owned by live nation as most people know that's got a 22 billion market cap uh and so you know i i think this is actually i might want to put a j trade on for this i have to we'll have to do a deep dive uh you and i when SPEAKER_35: we get closer to the ipo and we'll do that since that's your speciality listen a strong sales team SPEAKER_82: can make all the difference for a b2b startup but if you're going to hire sharks you need to let them hunt and you can't slow them down with compliance hurdles like sock two what is sock two well any company that stores customer data in the cloud needs to be sock two compliant if you don't have your sock too tight your sales team can't close major deals it's that simple but thankfully vanta makes it real easy to get and renew your sock two compliance on average vanta customers are compliant in just two to four weeks without vanta it takes three to five months vanta can save you hundreds of hours of work and up to 85 percent on compliance costs and vanta does more than just sock two they also automate up to 90 compliance for gdpr hipaa and more so here's your call to action stop slowing your sales team down and use vanta get a thousand dollars off at vanta.com twist that's vanta.com twist for one thousand dollars off your sock two the reason i really like these kind of companies is because SPEAKER_14: uh people want experiences i think you you talked a little bit about the stretching that people do buying a home buying a car i think generationally that stopped with uh my generation gen xers we SPEAKER_05: started to say like you know i really want that bmw but you know get the 325i but maybe i should go for the five to you know like and you kind of had this like little competition going with your friends and your peer group yeah oh i got a three bedroom apartment like i remember i knew somebody who had like a three bedroom and it was like one person like why do you have a three bedroom he's like oh what's a guest room and uh is it manhattan oh what's my guest room my office and you know then i have my bedroom and i'm like but but it's twelve hundred dollars per room that's four thousand dollars in SPEAKER_90: the 90s and i'm like that doesn't make any sense nepo baby whatever you know and that is i think SPEAKER_05: with each subsequent generation they look at home ownership and say you know i can't hit that therefore i'm never going to own a home because they're too expensive there's too few of them um but i can own experiences of my time and i look at my parents working really hard boomers and then you know people who have gen x parents they're working hard they're 50 years old they're 60 years old they're 70 years old they're still working hard and uh like now they're going to start going on vacation when they're 68 years old like i'll just take the vacations now and i'll do the reverse all you know f around there you go when i'm younger and then i'll you know work harder when i'm older and so SPEAKER_35: there's just a little bit of that going on but i love anything that's experience based i like the hotels SPEAKER_57: i like the cruises i like you know airlines uh you know tickets people want to do this and they're it's amazing they're willing to spend for it these um summer concerts taylor swift dude they're so expensive so expensive i'm here i'm independently post money and i i looked at the taylor swifts i was gonna like oh maybe i'll take my kit i was like whoa whoa whoa three thousand dollars a ticket SPEAKER_05: to go to a concert that's a two i mean i get it's a two hour concert but we're talking about uh i don't SPEAKER_97: know what that is ten dollars a minute i started doing the math on and i'm like this is not making sense SPEAKER_17: you should go to heavy metal shows they're like eight dollars and they're like four hours long it's super cost efficient so yeah i i actually always did this entertainment SPEAKER_99: per hour and i always thought about what had the most entertainment value per hour what do you think SPEAKER_97: has the most entertainment lowest enter highest entertainment value lowest cost per hour oh that's SPEAKER_18: easy you go to the you go to your local grocery store you get a six pack of fizzy water or beer whatever whatever your friends drink you get some chips and some like maybe some little carrots and some dip and then you put your favorite like six people around in your living room put on some music and just hang out like that if you have the right people that is the single most efficient way to have fun it works every time five bucks an hour boom well poker right i mean poker's another good one yeah SPEAKER_05: i mean if you're playing low stakes you could play a six hour session everybody throws in a hundred bucks so essentially it's free because the money is just moving around the table and getting distributed and you got to drink and eat food anyway so that's sort of baked in yeah that is actually activities SPEAKER_102: with your friends would be a great one absolutely what do you think about what's your video games SPEAKER_03: on a media basis if you think about packaged media a movie going to the movies winds up being like 20 SPEAKER_05: bucks a person with parking or whatever two hours ten dollars an hour you go to a theme park a hundred bucks you stay for 10 hours 10 bucks an hour and as i went through this you know when i when i used to SPEAKER_03: think about this when i was a journalist i was always like it always seems to be working out to SPEAKER_05: the minimum wage top plus or minus like maybe minimum wage times two and i think that there's something to this where like if you are charging people for entertainment they're willing to pay like i worked two days this week and i spent it on one day of entertainment you go to uh uh a sports game right okay so i go to sports on the weekend i go to a yankee game 50 bucks a ticket i go to a basketball game 150 bucks a ticket you know it's three or four hours of entertainment that's pretty expensive 25 SPEAKER_35: 35 bucks an hour but you know if you make that an hour you you kind of hash it out right so there SPEAKER_107: you have it yeah no i'm totally on that i think video games i'm sorry video games were the one i was SPEAKER_35: thinking if you hit a video game that you love like age of empires i've played a couple of thousand hours of age of empires it's kind of like chess to me and it costs 50 bucks so now you know if you play 50 hours you're at one dollar five hundred hours ten cents you pay for five thousand hours you're at penny an hour it's essentially free so i think video games also very um very cost efficient you SPEAKER_18: should see the number of games i have in my steam library that i haven't even actually installed yet that i've just bought the warehouse like old google employees but i'm totally with you on that uh the thing about i think concerts that i'm very excited about just put a pin in this is that people are still going i know music has always been a tough business and inflation has changed the cost of touring and such but every time a band that i love goes on tour they post pictures from their shows and it's packed and i think that there's it's good that humans are still going out and doing that even in this very modern digital instagrammy kind of era so that's also i think it's a reaction to just how SPEAKER_05: pernicious and addicting social media is and i see this with young kids you know i have a 14 year SPEAKER_14: old they have two eight year olds and uh they have peers and so we'll have we'll host kids over the house or whatever and man there's the television and streaming services youtube on ipads video games social media we don't want social media but a lot of other parents do and like i just remember one time we were at the ski house and they you know had a sleepover or whatever and some one of the kids SPEAKER_35: friends came over happened to be into like social media they were allowed and this kid was curled up in a ball going scrolling up scrolling up and i just like this is not a childhood you know and i was like i talked to this parent about it you know no judgments i understand like you know it's it's uh hard to enforce these things but you know here we are at a ski mountain there's three feet of snow outside there's a heated pool at the lodge they could go in a game room there with like pool and stuff SPEAKER_120: there's a pool and there's pool and i'm like in their shreds and i'm like in our childhood we SPEAKER_97: didn't have internet we didn't have distractions you know we may have had a video game console and that was something that was a bit of an allure and i just basically tell them like listen no screens until the sun goes down yeah and you can use screens if you had an active day on the mountain and you know what everybody bought into that and i think in some ways kids want that and it really was disturbing during this pandemic to see psychological negative effects and i just had john height on the all in interview show that we tested and his book um is really good about this anxious generation they need to get out there they need to be allowed to grow there's a really cool organization called let SPEAKER_14: grow you can google it and it's just about getting kids off screens and getting them in the real world SPEAKER_05: building their confidence let them play tag let somebody lose at tag let there be a wrestling match where somebody gets hurt and and then let them sort it out themselves without parental SPEAKER_28: intervention that's the thing everyone talks about how the kids are are soft but then you know SPEAKER_18: have you seen parents in the world you can see why they get it because they're have you heard of snow plow parenting no so not i know helicopter parenting snow plow parenting is when the parent goes in front SPEAKER_90: of the child and clears everything out of the way for us it is really yeah no i i learned the language language is so important you and i as wordsmiths um and word cells you know really care about this SPEAKER_05: when you have kids super important so when they come to you with their problem i say oh what's your SPEAKER_14: plan what's your strategy and they're like what's my strategy i'm like yeah you you got in a fight with your sibling or you and your friend can't decide something and so what's your strategy and they'll be like well they want to you know go in the pool and i want to watch a movie so i think well we'll do the pool then the movie because that makes sense and we'll just take a shower in between and i'm like okay great sounds like you have a good plan i suppose to getting in the you know the the rig and then SPEAKER_135: blowing the snow and clearing a path for them now you guys are going to sit down and mediate this right now and i'm going to be the reference like learn because otherwise life is just bad for you SPEAKER_14: like you're not helping your kids you're making absolutely not learned helplessness is a um it's really strange like there are some kids i see them you know at the schools and the functions who have this learned helplessness and they just anytime there's a problem they just cannot solve it they SPEAKER_05: give up no resiliency constantly going to their parents and you know this leads them to get into SPEAKER_14: the real world and they're not prepared to work at a job they're not prepared for anything well i mean SPEAKER_17: you and i could talk about parenting 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deserves more than a one-size-fits-all crm join 11 labs replicate modal and more and get ready to scale your startup to the next level head to attio.com twist and you'll get 15 SPEAKER_47: off your first year that's attio.com twist i want to loop back to uh inflation no actually because there's some very interesting stuff and then i want to work into venture capital numbers because i think we can paint a positive picture for all the founders out there and give them a little bit of good SPEAKER_18: news so we just learned that the consumer inflation rate has cooled in june we actually saw a decline in one point and a three percent gain year over year better than expectations now today wholesale prices the ppi ah this is the consumer inflation chart uh from bls showing how far it's come down and the last tick is actually the best one so that's very encouraging and then more recently we saw the producer price index or the ppi rise by 2.2 in june a little bit higher than expected but SPEAKER_47: not that bad and i think the overall inflation picture is cooling and as you said earlier we're SPEAKER_18: expecting a rate cut here's my question for you knowing all of that the rate cuts coming maybe even two this year we'll see when does the good vibes begin to trickle down to the vcs and then trickle down to the startups because rates have been high money's been expensive valuations have been down SPEAKER_00: when does it begin to flip now that the good news is coming so when the exits occur bringing up the stub hub thing whoever the investors are now that's a really old company but you know let's say another company like stripe when stripe goes public those distributions happen that's when the good times start to roll again why well because people will have renewed faith in the venture capital industrial complex this venture capital industrial complex people don't believe in it right now because they SPEAKER_03: haven't seen the exits and so when you have a couple of years of very few exits now people start to SPEAKER_00: say well maybe they'll never be one again they literally become so pessimistic the boston celtics will never win a title again we traded kevin garnett or whatever and then all of a sudden hope springs SPEAKER_05: eternal and they're back in the game and they win a championship so you know the the psychology of SPEAKER_64: humans is very strange you know you could see the airbnb coinbase and uber ipos uh and you know SPEAKER_03: that wasn't too long ago or five years ago and then people all of a sudden it's five years later like SPEAKER_05: it's you know the industry's over it's over it's never gonna happen again and it's like um because watching what happened with nvidia are you watching what's happening with tesla are you watching what's happening with facebook and meta going from 91 a share to 500 a share in 18 months like wake up folks like these are the world can still change companies can still have ipos and there can be SPEAKER_03: exit so there's just a little malaise and once that gets lifted when people feel rich they behave SPEAKER_05: differently when they feel optimistic they behave differently so the reason why people were willing to spend 250 000 on jpeg was because they felt rich it was a link to a jpeg it wasn't the jpeg itself sure the hash of the jpeg sorry but this was the craziest moment like i'm like okay listen i i i'm super like open to new innovations but i'm sorry what you're you're buying you know immutable jpegs and SPEAKER_35: imaginary money the whole crypto f you know frenzy was because people believed everything went up and to the right and stonks go up that was kind of you know um uh dave port and i was kind of joke when he was doing his day trading it was like stocks go up that's why we buy stocks because they go up and he was it's kind of like his like you know pizza reviews every everybody knows the rule one bite and then he takes four bites like he's obviously joking with you stocks can go down as well um and so you SPEAKER_97: have moments of irrational irrational pessimism we've been in for the last couple years irrational optimism during crypto and stocks and game stong and game stop and etc so i think we're probably over indexing on uh pessimistic that's why so many venture firms are going out of business that's why yeah uh you know you're seeing this consolidation companies got a business but it's i've learned SPEAKER_14: over these last three boom bust cycles because now i'm old and you're getting old too i know as i SPEAKER_47: pointed out on a show recently all right there's a new theme there's now a theme to the show we're getting on jason tells alex he's also old that's also old i'll put that on the show notes i mean SPEAKER_03: 18 years younger but still old um people were really taken back by my i would give up every penny in order SPEAKER_14: to yeah that kind of caught like people were like off guard they're like what i'm like yeah 18 years SPEAKER_17: back yeah the difference the difference is how much people put uh someone's success to luck versus SPEAKER_18: because if you can go back and you don't have the same luck some people might think that there's then no hope for a similar rebuild but you're saying if i get 18 years back what would i pay per minute per hour per year of your time per year incredible um so long story short uh to your original David Friedberg: question it's going to get better um and the lunacy will come back when people feel rich again yeah SPEAKER_00: people are because of the stock market feeling pretty good but there's kind of like when's this SPEAKER_03: rug going to get pulled out when's the correction coming it feels a little too good yes um the inflation feels like okay it's trending but there's still this fear like it's going to come back SPEAKER_05: so there's a low grade anxiety in the markets and a low grade and a high grade anxiety in silicon valley about venture you kind of layer these things on and i was just talking to a friend who was had SPEAKER_14: some stomach problems and i'm like are you feeling existential angst they're like maybe maybe i am SPEAKER_170: i'm like okay that manifests in the stomach like you're hurting also like urs uh ulcers like ulcers like SPEAKER_172: this is like a known thing like uh and so we're going to see these two things get worked out over the SPEAKER_35: next year i think or very very quickly actually i think it could be by the end of this year see a couple of ipos see a couple of rate cuts people start feeling really good about it now if inflation comes back with a three four print instead of a three oh print that could put a big dampening on SPEAKER_18: it yeah so there's a lot of what has inflation done in its most recent tick and then we all kind of forecast off of that the rate cuts will happen when the break cuts happen probably one this year maybe two now the thing that i've been kind of looking for are green shoots in the world of venture because i also agree that things have been a little bit too pessimistic for too long and so i pulled some data but i want to start with the bad news and then tell you the good news so let's talk about what happened in asia on the venture capital side in the second quarter crunch SPEAKER_47: base has some new data out that i pulled for us uh quoting from crunch base news asia suffered its worst quarter for venture funding since the final quarter of 2015 with asia-based startups raising only 14.6 billion off 24 from the first quarter and 32 from last year this is of course jason driven by china which has always been the biggest player in asian venture capital and uh these season that country only put 6.9 billion dollars to work in their first quarter that was off 46 from q1 and a third SPEAKER_18: off from q2 of last year just just brutal brutal numbers and i don't think either one of us are surprised by them given some high-flying indians started struggling and of course china's SPEAKER_47: authoritarian uh tilt if you will uh towards business in the last couple years now that's the bad news there's good news for founders in europe and so i was so glad you teed up the european comment earlier on because we have something that's better than expected so pulling from deal room data so from the deal room presentation this is the historical amount of venture capital dispersed inside of europe and in the second quarter it was up 14 compared to q1 and 12 year on year so jason tell me why you now must eat all of your words about european regulation because haha we have seen some gains SPEAKER_64: um i mean they're modest gains let's let's be clear but um you know if you were to normalize the line and take out the zerp era um it would look pretty anemic right it would look not flat SPEAKER_03: um but it would it would look slow so you know like everything else in europe it's just slow growth David Friedberg: um oh man yeah almost i mean it's it's almost slow by design right if you don't if you want to create SPEAKER_14: regulations that protect workers protect the environment you know and you know that's your SPEAKER_05: choice as a society to do that it will just take away the the the x the speed at which things get done right we're seeing it here in the united states with regulation as well right so things can get slowed down you want to build a factory can't do it in california can do it in texas you know etc so SPEAKER_14: um the asia thing is the most interesting to me because india of course is included in that data SPEAKER_00: uh or not because i know some people when they do asia they'll leave india out because it's so big now SPEAKER_184: yeah so that is included and if you want the indian numbers um 3.4 billion in second quarter funding SPEAKER_186: 27 up from q1 but 9 down year over year so kind of mixed picture there yeah india is very um uh well SPEAKER_35: venture data because of big deals like we talked about with the xai deal can get skewed right a big deal can drop in one quarter so you got to look year over year and look at a 10-year trend i do think um people are looking for where to deploy money and china was a really great place to deploy money for a couple decades now with isolationism you know uh both chosen and imposed you know the chinese have chosen to isolate a bit and it's being imposed upon them because we have uh fisa you know when you're SPEAKER_97: at foreign investment in some of these regions they're they're slowing you down sequoia had to deal with this anybody investing in chips has had to deal with this oh yeah you'll get a little knock on the door like hey you're investing in something over there let's talk about it yeah let's talk SPEAKER_35: about because if you if you do invest in china you're essentially investing in the chinese government SPEAKER_193: just by default right because they own and they're on the boards of these companies and SPEAKER_97: dd and tick tock it's all their companies at the end of the day is the way it works in those ecosystems so SPEAKER_14: um yeah it's china's quite a story uh in terms of just a lack of investment there we talked about that before and india's i know that a lot of americans a lot of american investors and investors SPEAKER_64: in mina the middle east uh north african region are kind of looking at it and saying hmm population growth SPEAKER_03: and there's a middle class that's emerging and this is when you want to make money as a capital David Friedberg: allocator you're looking for trends that are so pronounced that they will um you know create really big waves you can serve yeah india's population is growing china's is contracting and japan's is SPEAKER_03: contracting okay there's one really big trend you could ride they've also started these ten dollar um SPEAKER_14: uh that maybe they cost fifteen dollar android phones there's a very there's a specific company SPEAKER_05: that's selling fifteen dollar android phones and then the service is three or four dollars a month yeah i forgot the name of it but it's become like a huge trend in india this one of the richest people people in india has been doing this it's a very bold move to just be like you know what screw it i'm SPEAKER_194: going to just flood the country with cheap android phones and it worked geo this is uh reliance uh the SPEAKER_18: reliance umbrella of companies geo is their low-cost mobile provider very good company and i believe that a bunch of american tech companies bought a small stake in it because they want to make sure they SPEAKER_35: had access to the indian consumer might be the one who has a big partnership with them and they made this like facebook light like a a lower footprint app that could work on like you know what are essentially three or four year old android level phones um so i think they've got a couple of hundred million people and so you got people who are living in essentially poverty but have an android phone now it's very interesting on a science fiction societal basis this probably hasn't happened in a long time SPEAKER_14: but to be uh living you know under the poverty line on a dollar a day whatever those statistics are SPEAKER_03: maybe you know running water shared maybe you know uh electricity being inconsistent sure not having SPEAKER_05: it in your home whatever it is and then you have a smartphone with broadband with access to chat gpd SPEAKER_45: and wikipedia and youtube like this is kind of crazy and um where did this happen last it happened in china David Friedberg: yeah it happened in china everybody started to work in factories and they worked in factories SPEAKER_05: in order to build the smartphones so this is all like the smartphone revolution has had such a profound impact on so many different dimensions that black mirror has had a massive massive impact that's very David Friedberg: different than i think we'll look back historically like um on the introduction of the smartphone specifically in a way like we look at steam engines airplanes factories other things writing yeah SPEAKER_18: personal computing the internet and then mobile internet connectivity computing is like like those are the three big epics we've seen thus far and what's interesting about your point about smartphone manufacturing being actually a way that people rose from let's call it agricultural rural poverty to uh a rising working class towards the middle class in a more industrialized society in china was through often smartphone construction where is that moving now jason well people are moving factories out of china into vietnam and into big india yeah i mean foxconn's doing a big push into SPEAKER_03: india they're making iphone 14s i think and maybe even 15s now in india so SPEAKER_13: um all of this means india is like a really interesting market all right everybody welcome SPEAKER_208: back to the program steven estes is with us again he's a principal at cla they're a professional services provider they specialize in cpa tax consulting and wealth advisory his areas of expertise lie in vc-backed startups vc funds high growth startups with complex tax issues in multi-state and international filings welcome back to the program steven hey thanks jason appreciate it when you look at these growth periods right when startups start rapidly growing SPEAKER_209: how do they screw it up first and foremost the sales tax there was a big shakeup in that about four years ago it kind of opened the floodgates to states really being able to force small companies to collect and remit sales tax in a lot of different states when we had the pandemic hit and the rise of remote work that really intensified that as having employees in various states creates the requirement to collect and remit to sales and customers in that state so that was huge and then secondly like really just like how to handle the issuance of equity key employees it amazes me that founders don't know more about various restricted stock awards and stock option plans that are out there safes have been a godsend when it comes to keeping 409a values low for early stage companies but a lot of founders don't have a clue when it comes to how like a priced round can negatively impact your ability to bring on those critical hires because it really massively increases the tax liabilities that come with SPEAKER_208: the receipt of equity in those companies all right you need a trusted advisor taxes accounting you don't want to play games with this stuff get it right get a great partner like cla go to cla connect dot com slash tech and let them know your boy jake al sent you once again cla connect dot com slash tech SPEAKER_216: i also noticed a lot of indian entrepreneurs okay when i was in the middle east when i was in dubai SPEAKER_03: abu dhabi uh saudi doha there a lot of them are moving there now that's really interesting bedfellows SPEAKER_18: that is very interesting because why yeah you tell me no no you tell me why well i i was i realized i was about to get in trouble so i was backpedaling away from my own comment like a like a prodded crawdad SPEAKER_14: yeah uh well uh if we pull up flights from dubai uh to mumbai uh-huh uh oh my gosh that's free SPEAKER_81: yeah so you know round trip 229 uh three hour flight this is mumbai to dubai three hour flight you SPEAKER_38: know this is like going from new york to miami right it's not quite los angeles to san francisco but SPEAKER_97: yeah it's a hop skip it's a hop skip um and i don't know other cities are if other cities are closer SPEAKER_35: but if i were to do uh um i think saudi yeah four hour non-stop from uh riad to mumbai and i think SPEAKER_97: there are other cities that are closer you know there's some cities that are like an hour uh so you start looking at that they're they're like states that are next to each other okay now let's peel back one more time the mina region is very small countries uh saudi's big 30 40 million people SPEAKER_35: uae's couple million people doha i'm sorry um qatar does the city qatar is like i think 1.5 million SPEAKER_97: people and maybe 400 000 nationals the number of nationalists in these countries very small in fact saudi is a very large country people don't realize that compared to the others india's giant billion people so you got a billion people here you got two million people over here when they need uh help SPEAKER_64: in those countries to build something pakistani indian sri lankan construction workers domestic staff uh waiters it's like everywhere and then also thai singapore they also can go to those regions so SPEAKER_05: then you have entrepreneurs happening well if you're an entrepreneur in india and you can't raise funding and then you have uh nationals who have large wealth uh when i was there i spoke to a group of like 30 SPEAKER_230: angel investors and they hosted a lunchroom with 30 family slash angel investors and they like they SPEAKER_03: had all read my book because there's really only one book on angel investing so i'm like one of one SPEAKER_05: but they had all read the book and they were all pursuing techniques in angel investing so this is the first decade that they're doing it and they're looking at markets and they're like yeah it's nice to launch something karim uh you know the uber of uh the the region yeah the middle east like okay yeah those things are gonna happen but there's a billion people over there maybe we should build some stuff SPEAKER_14: over there it's only three hours away so it's the same way masayoshi-san in japan was like okay the japanese market's great but we could also go to vietnam singapore korea and let's take this you know SPEAKER_35: line company soft bank whatever let's try to find other regions that we can go uh build businesses SPEAKER_17: in so it's pretty interesting i want to just double click on one thing before we move on and talk about SPEAKER_234: open ai how how bullish are investors on india today in the venture capital community and how does that compare to to 12 or 18 months ago i want to understand that what's changed they're very interested David Friedberg: they're very interested because it's a democracy it's not a high functioning democracy it's like one SPEAKER_64: of these democracies that's kind of you know i don't want to say teetering but it's a democracy but if you were to look at the democratic index they would put it you know it's like a tier down or two David Friedberg: tiers down so it is a democracy you could feel relatively safe making a bet in india or in dubai or abu SPEAKER_14: dubi and then people would feel less secure making a bet you know in russia obviously uh if you've read SPEAKER_81: red notice your lawyer will be murdered like that book by the way incredible incredible i mean it's SPEAKER_54: just if you want an incredible book to read this summer or listen to the audiobook's fantastic as well SPEAKER_172: go for it um and so you know i think that's uh what's happened in china you know if you own shares SPEAKER_54: and alibaba you know do you trust what's going on there uh they've they do financial manipulation of SPEAKER_14: their currency they're on the boards of these companies they have data agreements with these companies and of course like could the account i mean with this whole real estate thing that was SPEAKER_97: going on in china like the government we're in a democracy where investigative journalists have to figure out and traders and shorters have to figure out the fraud in the united states right SPEAKER_14: so we have this like weird antibodies here strut selling you know uh all the hindenburg research SPEAKER_81: like they serve a really good purpose to find fraud i love these guys yeah me too i love your SPEAKER_57: reports we have whistleblowers another incredible tradition and people don't people forget here a SPEAKER_35: whistleblower gets paid half of the money that they get recovered you can make a hundred million dollars right now going and you know finding the next made up this is a big prize for you hindenburg gets a big prize that you short the stock goes down you make all your money secure your bag SPEAKER_97: you get out um and and of course we have journalists who win awards and prizes and status that's the SPEAKER_246: worst like you can have a bajillion dollars you can have a bajillion dollars or a small plastic statue Chamath Palihapitiya: and a crappy dinner at a round table but if you're an elite if you're a wordsmith like us to break the David Friedberg: story of you know uh of the catholic church at the boston globe in your you know whatever second tier SPEAKER_05: city is supposedly and you break a story like that come on i mean that's as good as it gets you could be really i mean for your entire life you have that if you're john kerry really knew yes uh exposed SPEAKER_172: theranos i mean the joy that would come from that is just for certain people including myself SPEAKER_250: yes i was just laughing at winning the world series of poker that does come with um a couple of dollars though as well as the the pride elements of it by the way when are we uh when are we going to SPEAKER_17: go do the main event together oh absolutely next year for sure and i will uh i will stake you you SPEAKER_47: are officially you can buy half you can buy half my action but okay i i i realized that it was going on SPEAKER_17: i think right now and i wasn't there and i need a buddy to go with next summer we'll go for two weeks SPEAKER_45: and we'll do interviews there we'll we'll do the show for two weeks we'll absolutely book that i'll SPEAKER_14: buy you into a bunch of stuff uh you know i'll play for charity you pay for your kids charity for college education and we will have a blast we'll do some meetups we'll interview people because there's a SPEAKER_18: lot of founders there'd be great there's a great idea i i really think we need to take a twist on the road at some point in time but um just for the sake of time let's talk about open ai so the big SPEAKER_47: news this week is that open ai had an internal meeting and they sat everyone down and said hey here's how we're thinking about the world and here's where we are so in open ai's perspective there are five levels of artificial intelligence the first one we're all familiar with chat bots we've all used them easy number two level two is reasoners so essentially things that can think as well as humans level three is agents essentially ai that can do stuff and yeah i talked about that level four is innovators essentially ai that can help us come up with new ideas i like that and then level five in open ai's view is organizational ai or ai that can do the work of a team now the thing is and why this is so interesting to me is open ai thinks they're at level one and they're nearly at level two but SPEAKER_18: agents in their conception are level three but right now we're seeing venture capitalists and founders SPEAKER_47: fund and build a lot of agentic ai startups like sierra with brett taylor of course yeah and so the thing that i'm trying to sort out here is who's right because open ai is saying oh we're not there even we we're not there yet and founders are saying we're there we're doing this and so there's an SPEAKER_18: interesting tension between who's actually correct about opening about agents in an ai context i'm SPEAKER_00: fascinated by this it's an interest it's great to make a list like this and start thinking about it this is like i robot territory uh asimov you know i'm not i haven't read his stuff but i've seen his David Friedberg: i've seen the movies based on his stuff so we're sort of getting into rules of robotics here rules of being sentient blade runner territory um agents are easily available today they're just locked down so you know apple does not let you have ai open apps up and do things ai is capable of that today it's that the cost of running an agent that then went awry who's responsible for it is problematic so if i were to say to gemini or chat gpt4 i need a flight to dubai book me a flight based on my criteria SPEAKER_05: and it went and booked me something and it was like i don't know there's a 27 000 ticket because it's the last one available and it knows that i like to fly this certain time but the two flights on either side of it are 2700 that's a big mistake to make right or hey order me sushi the chef cooks all the sushi they bring it and they gave you the sushi you don't like and you send it back so anyway it kind of David Friedberg: reminds me of the amazon uh alexa conundrum where you nobody really trusted alexa to say hey alexa buy SPEAKER_57: me coffee what if it buys the wrong beans like people are very particular about their coffee so SPEAKER_97: agents have worked for some time they could work today it's that the cost is is a human one and and the the the cost of a mistake uh is just really challenging and who bears the cost of the mistake so i would argue reasoning they're like 30 of the way there uh you know and then i think with agents were probably 50 60 70 percent of the way there it really is that trust piece i do think they have the order of the last two incorrect i think they're or they're like obsession with organizations is like kind of silly because once you have five agents doing things that's kind of an organization i think SPEAKER_35: the innovation is the key and you have to really define that i would say to be able to solve problems humans have yet to solve to be able to solve problems humans can't solve these are really two SPEAKER_97: different things so it might be that ai figures out hey where are you know where where where are these endangered species by looking at satellite images and it's just because it's like such a big SPEAKER_35: project humans haven't gotten to it or like studying these folding of proteins and finding some new thing it's really kind of like brute force like a human can do it but ai can do it a thousand times faster SPEAKER_97: then there's make a unique novel discovery in the world how does dark matter work what happened before the big bang you know that's the kind of stuff where if it could solve conundrums that we don't understand solve math equations that are not solved by humans yet those are two different levels of unique innovation in the world and i think there's like soft and there's hard and i think that's the SPEAKER_35: two levels when we see it solve something hard that's when it's gonna get really weird like really weird that's like the aliens coming to your planet and being like you know what uh oh you guys have SPEAKER_05: been dealing with cancer oh we solved that 300 years ago here here's the formula and you're they just SPEAKER_03: hand you like a thumb drive or like they just tap you on the nose and it's in your brain and you're like SPEAKER_14: oh yeah we wouldn't have gotten to that for another 300 years because we're just our brains aren't big enough so that's the one i think is like whoa that's going to change the species forever this kind of stuff's going to be just a lot of incremental speed and velocity to solving problems in the world David Friedberg: but the fact that they're thinking like this speaks to their noble origin of wanting to make this technology SPEAKER_05: um accessible to everybody for free and do it in a thoughtful open way i combine this yes i agree with David Friedberg: that yeah that was kind of the ethos that i think you know got people like elon to write eight figure SPEAKER_35: checks into this non-profit but now to take that entire ethos and say commercial ipo secondary offerings that's where i think there's an ethical problem i think that's why people are now i mean i don't know if you've seen the pylon on sam altman um who we had on all in but there's basically this i mean i i don't want to speak i like sam and i'm friendly with him so i don't want to say anything negative about him but basically people are saying outwardly you cannot trust this person like ari emmanuel said it right mm-hmm like i i haven't seen this in my career where a whole group of people have come out and said this person is not to be trusted can you think of any time SPEAKER_57: that's happened in business where people have raised like in unison a bunch of people are just like SPEAKER_18: don't trust this person well there have been certain examples i mean you mentioned made off earlier i think after he got exposed that was the case i think okay yeah like largest ponzi scheme in SPEAKER_281: history but a person who has not been convicted of a ponzi scheme trump famous for not paying his SPEAKER_285: bills okay sure not to bring politics to this but that was the first example that came to mind having SPEAKER_288: read his history in atlantic city and so forth yeah yeah yeah trump university yeah he's been a low level you know bending the rules grifter hustler guy yeah sure yeah so anyway i just think this is SPEAKER_97: like a this is what really is at stake with ai is whoever gets to you know when you go down that list SPEAKER_234: who gets there first matters i i think that's definitely the case but my question is will it be like what we've seen so far because one thing that's blown my mind is chat gpd comes out everyone SPEAKER_47: goes holy crap this is amazing look at this thing look at the things we can do with it look at the look what it can unlock for us and then the market quickly caught up in llm potential like i mean llama clod gemini i mean there's a lot of models out there that are pretty good and all progressing pretty quickly so when you say who gets there first i want to know how close is the second place to catching up because if the answer is 20 minutes it's probably less valuable than if it's 20 years so that's one thing that i i just don't know if everyone can keep progressing at the same rate more or less or if people are going to start to pull ahead with better talent more compute or whatever it is that is the SPEAKER_18: differentiating factor but at least according to open ai we are early on all things ai i mean the fact that they're level 1.5 out of 5 is either encouraging or depressing i don't know which one SPEAKER_17: uh i put them at like two out of five i put them at two out of five if you you know were to pro rate SPEAKER_64: you know they're 30 on asians oh i see i see 30 on this 10 on the other two i kind of give a little bit more uh but the product's gotten i feel like the product is if it was a if this product was a human being yes i feel like it's growing 10 years every year or more in terms of experience SPEAKER_81: because yeah you know like it it didn't feel like a child it felt like a college student for a little SPEAKER_14: while like a high school college student like it's naive but it can answer the questions on the standardized test and now i feel like it's a young adult it's an uh it's an adult like it's a a SPEAKER_35: researcher uh who's 30 years old working at mckenzie or something or a 28 year old working you know at SPEAKER_97: the corporate headquarters of walmart or something like you can ask it to do a task that's multi-pronged SPEAKER_297: and it will do like a research i put it like as a researcher it's like a somewhere between a SPEAKER_18: researcher and analyst today yeah one thing i want to get to not today we don't have time but i want to go i want to go back and interrogate the uh who's gonna win sass plus ai or software that's rebuilt from the ground up to be ai first you talked about this with sarah tavel uh on an interview back in september that i was going through and i'm really curious to see how much of software needs to be rebuilt to take advantage of all the stuff that we're discussing today because SPEAKER_135: if it's growing by 10 years every year ai eventually everything else is going to look SPEAKER_64: pretty silly and dated yeah i i agree uh and it's just as a product it's it has been getting better SPEAKER_54: and better i've been talking about some like complex examples i've been giving chat gpt4o and claude 3.5 yeah but it's got a name sonnet is it sonnet yeah it might be sonnet yeah and it's pretty SPEAKER_00: pretty pretty darn impressive i think we're at the researcher phase and man so what it means to me is SPEAKER_14: you just for every i think one researcher is two researchers today using chat gpt yeah oh this one SPEAKER_28: research about static employee bases and rising revenues at companies for the next three to five SPEAKER_18: years as people have more i don't know let's just call it overall leverage on their time using more technology yeah this is not the bicycle for the mine this is the uh the moped up to the ducati SPEAKER_304: of the mine and we'll see when we get to the f1 card mine it's almost like i i think you would have SPEAKER_54: almost unlimited researchers at some point and then you're just like the value of research becomes kind SPEAKER_35: of commodified it's almost like having um accountants back in the day um or a typing pool um like you you had a photocopy and a document storage and a typing pool and a research department and you had an accounting department and you had data data entry people like all that stuff kind of got abstracted SPEAKER_97: away by technology and i do feel like research and analysis like if you i wouldn't short i don't like to short companies but mckenzie boston consulting group like all those consultants like what they're doing what chat gpt does go take the corpus of knowledge yes and then regurgitate it with some context SPEAKER_175: for this application like and and it just works so one thing that ai cannot do is provide cover in the same way to corporations who want to cut staff but not have it be their idea that's what i think SPEAKER_18: the real job market is for the mckenzie's and the boston consulting groups is you pay them four million dollars they come in they say you need to fire half your staff and then you go oh guys we got to do some layoff mckenzie told us too it's not like we invented that and then hired them to tell us what we knew that's what i think that their real model is and that would be hard to take away but anything that was lower level is just going to get consumed because you don't need to pay a human to do it anymore and frankly i wonder what that's going to do to us in 50 years but you know graphing SPEAKER_30: calculators came out people still learn geometry so it's probably going to be okay okay jakel let's do just 500 i have great so much for you so you sent a call you said everybody in the community hit us with SPEAKER_47: your favorite construction and housing startups and holy crap did people write in dozens and dozens and dozens of companies and i have put them into two main buckets there's the world startup that's going to help you build things and then there are the startups that are working on software SPEAKER_18: and marketplaces for the construction tech world so in the building things group there are companies working on adus or additional dwelling units companies like cover houseable zones and samara SPEAKER_47: then there's prefab construction build it off site bring it on install it companies like boxable plant preflab and zeny then a lot of 3d printing startups working with concrete names like mighty buildings asher printed homes and icon and then my favorite group robotic construction talked about robots the other week there's really cool companies like dusty robotics cubie monumental agoras advanced construction robots and paint jet we'll have videos of a couple of those in just a second and then keeping my monologue alive the software group these i broke down into digital design software often with a collaborative twist companies like upgrade rayon snaptrude and palazzo ai then there's marketplaces for goods and services kojo build stock visual note-taking and essentially bringing images of the worksite to your SPEAKER_18: computer open space company cam and then finally a lot of vertical sas for construction built technologies hierarch property data from lab permit flow hammer shepherd field wire building swell and more the thing that hit me was how many companies are tackling a big chunk or a smaller chunk of this market i did not know that there are this many companies that have raised five ten fifty million dollars that are working here did you know that there were this many companies yeah we had a we had SPEAKER_35: an investment in a company called blockable and they've had a bit of a of a tough time because when you actually have to get and there was uh calterra which softbank dropped like a billion dollars on uh and they had like 50 different businesses they were pursuing and the management was a bit of a disaster i'm told on the back channel um and so it's such a big prize it's so complex that when you go and SPEAKER_276: you do the problem set the problems to be solved in construction are never ending everything can be improved so everything from um the hvac system right and the electronics in the house that that that in SPEAKER_35: and of itself is a startup then there's i want to build a home okay uh do you want to build a small home a big home multi-family so you have such a range of use cases for construction um and then you know SPEAKER_14: if you've ever built a home or you've been involved in a project there are all these phases and there's SPEAKER_276: all these different vendors that are involved so managing the process is software and all of that can SPEAKER_05: be improved so how the architects and the general contractor and the subcontractors all work well SPEAKER_14: you take that process and then you take every new technology that comes out and then you make a grid and i've done this before as an exercise yeah and then each box should get filled in some way so what are three recent trends horizontal trends in technology what are the last three or four that are interesting SPEAKER_317: uh the horizontal trends i would say is a movement of well define horizontal in this context like ai is SPEAKER_14: a horizontal cloud computing okay so like a a new technology that's come out that affects everything so ai i'll give you that one cloud computing is over but so we have ai as one so now you take ai SPEAKER_297: okay what's another one apple released a new product recently well the vision pro but i don't think SPEAKER_282: that's actually going to pull off okay so fine ar vr there you go ar vr okay so you get ar vr uh you have crypto i was about to say blockchain but i didn't want you to shout at me so i was going to SPEAKER_322: do it i mean it is a horizontal technology that you could apply to everything and you have absolutely SPEAKER_14: yes so we had a startup uh that we invested in that's taking homes and allowing people to sell SPEAKER_35: shares in a home and putting it on the blockchain um and then you could buy tokens that represent shares in a home and that's a way for you to kind of do a reverse mortgage or for a home to be owned by many people uh you take ar vr we have a company i believe it's argyle that takes your uh you put goggles on you walk around a construction site with the general contractor with the owners with a potential buyer of this apartment or this unit and they get to see it and then the person who's doing the construction can look down and it says here's where you put the electrical trowel here and this is where each crew goes and they're seeing where the screw goes and then they put their screw gun on and go like whoa so you can take any new horizontal technology once you know the problem set and say SPEAKER_97: well how does ai impact the construction of homes well i don't know but maybe it's an ai robot then you take robotics robotic brick layer then you take 3d printing okay 3d printing can do can you make SPEAKER_35: plastics can you make walls what can you make with 3d printing and um you know then the challenge becomes it's a slow incumbent industry that's resistant to change that's the problem well it also SPEAKER_28: depends on a lot of folks who uh swing a hammer for a living so bringing technology solutions to people who are working with their hands is difficult i mean we have ruggedized tablets we have arvr but like it's going to take a while to go ahead and move this industry forward now i have a couple of videos SPEAKER_18: to show off what we're talking about here because i know you love some videos so here is a clip from a company called cover that i want to put on the twist 500 because i think they're awesome they're SPEAKER_47: working in the backyard adu space and we're going to kick that off right now okay here we go in a SPEAKER_18: factory and this is what they build so this is a backyard adu uh additional dwelling unit i believe now this is a teaser in law unit yeah yeah yeah exactly uh but separate so not not inside the same SPEAKER_47: house um somewhere else and what they're doing is building stuff at a factory as you can see bringing it out to the site and putting it together quickly i love cheap fast and roomy are my things for housing because i think everyone should have space at a low cost love cover uh they have raised a good amount of money they have put together a total of 73 million so far let's move on to the next one here icon 3d printing more homes now you can see this robot in action here and jacal i believe it is SPEAKER_18: doing layers of concrete sequentially in a certain in a shape and it's just awesome because you know once SPEAKER_64: that dries it is immovable yeah that those are fascinating to me because they're just taking what people were using at home with 3d and just saying well we can build a honeycomb here we can build a wall of course you know the question is uh the cost of those materials versus doing the studs and the beams um and then do you want to live in a concrete mausoleum you know so there you know that's SPEAKER_12: going to be the rub with icon i think but i do think um you can build pretty quickly and then so now SPEAKER_14: you have a really nice competition building in a factory with new materials new science and then SPEAKER_35: driving it from the factory and using a crane to put it in your backyard yes or setting up a giant 3d printer and you live in a stone adobe mausoleum prison cell like you know and which one's cheaper and faster and you know in some there might be some climates uh or some places where the stone one's much better i would think if you were in florida and i don't know about heat and stone but you know SPEAKER_64: you build one of those concrete things and it's two stories and the first story has a pass through SPEAKER_14: where when it floods it just goes underneath it so a lot of the homes in florida and the bayou and a lot of those places that are um being impacted by rising sea levels the first floor you SPEAKER_00: park your cars under it alex yeah and there's no first floor and there's no basement obviously SPEAKER_64: you just drive your cars or you store your surfboards or whatever under the house when the eventual flood happens no problem you're just on your porch during the zombie apocalypse and the water's flowing under it the zombies are walking around you're you're up one story and you have like a lot of stairways up to your house so i do think these things are going to have great applications SPEAKER_05: they're going to face regulations and that's one of the great things the reason why these adus are SPEAKER_14: working now and blockable was a bit early and some of the other startups were a little bit too early yeah timing so much of this business um the reason was they um were you would be up against nimbyism you want to put an extra unit in your backyard yeah can you rent it can you rent it oh you're renting it oh SPEAKER_35: it's an adu okay so you're renting it for a thousand dollars oh so you're renting it to those people SPEAKER_349: but oh those people yeah and those people are poor people or anyone who's even one socioeconomic SPEAKER_194: class lower yes those people are below me right those people were me 10 years ago i don't want them SPEAKER_57: anywhere near me yes and it's like uh those are the people who are changing your kids diapers or like cleaning your garden or teaching your kids at school or the firefighter who comes to your house and puts SPEAKER_97: out the fire like the nimbyism and i'll never understand i never understand it either and i'm not SPEAKER_18: i'm not even from a city i mean you're a brooklyn kid i'm from rural oregon and i don't get it like i grew up with cows literally like if you walk down our backyard to the wire fence the other side was SPEAKER_30: cows and i i understand though that if i want to live in a society that has a a working high street SPEAKER_357: as they say in the uk uh then there's going to be other people around me and they need a place to SPEAKER_30: live and you know what you know how san francisco radicalized me san francisco radicalized me against SPEAKER_18: nineties like it like watching anyone try to build in san francisco i remember there was this one time SPEAKER_47: there was a laundromat decades now is it well yes but the reasons why are hilarious there was a historically SPEAKER_358: uh important laundromat and i'm like i've been there it's not it's a it's a laundromat tear it down SPEAKER_45: uh ginsburg wrote poetry in this laundromat while he was cleaning his dirty shorts okay okay great you SPEAKER_234: know what put a plaque on the first floor of the new 40-story building because people cities are for people they're not living museums now i want to go back there to your mausoleum comment and just run some SPEAKER_18: defense here for concrete buildings i don't know anything about temperature control or airflow control but i will say this i will live in the concrete mausoleum because it looks awesome and i want to be able to say my house printed that just as a nerd that just really sits well with me but um we have a place in new orleans so i've seen a lot of the different construction styles down there about SPEAKER_47: how to handle flooding it's going to be a different world in a lot of places uh let's keep moving though sure uh court i want you to grab me the dusty robotics video this one is fantastic jason what is this adorable little guy this is a robot looks like a rumba if you're not watching the video and it goes around a concrete floor and prints out the floor plan for studs for screws and for all the other things that humans have to do with um uh chalk chalk lines or you know with rulers essentially SPEAKER_144: this is the coolest thing when i was just prepping for the show today i was entranced by how adorable SPEAKER_64: this thing is great well uh so here you go like there's a concept here of finding a really acute problem i think paul graham calls a hair on fire problem um some people call it a painkiller you know like you you sprained your ankle you need something now to turn off that pain this is like one of those SPEAKER_97: perfect examples you also can call this a wedge strategy somebody looked at or somebody was in SPEAKER_14: construction and they said you know uh it'd be great if robots could build the entire building and they're like yeah robots can't do that yet and it's like okay it'd be great if they could build the walls and i can't do that yet and i guess with the 3d robot they can and they said well well tell me SPEAKER_05: what takes a lot of time and the person's like down on their hands and knees with that color chalk SPEAKER_03: with the things and they're like uh i don't know you know well how long does what you're doing take and they're like oh this is the worst it takes 10 hours takes you 10 hours like oh no it takes us 10 hours per floor per room whatever and they're like huh roomba i got a room at home what if a SPEAKER_148: roomba did it and it would be more accurate so this is more accurate cheaper better perfect application SPEAKER_05: so that's the timing i was talking about when you're doing a startup you you really have to be able to SPEAKER_14: do something 10 times better than it's currently being done to get what's called product market fit and to get market pull so the strongest aspect of product market fit is market pull which means David Friedberg: people are calling you on the phone and they're like i need that i heard you got that i need you to bring it over right now here's my credit card i'm sending a messenger over with a check i need SPEAKER_14: that and you think about in your life like how many times that's happened very rare but when you SPEAKER_35: see something like this and if somebody's building a construction site and they you know the person who puts those chalk lines down isn't available and this is available you could see people being like i need that over here today can you get me a couple of those how do i get those like any other groundbreaking product the the market would pull this one and and that's really the the high art of being an entrepreneur if something is so obvious then the solution is out there already uh but if the timing is SPEAKER_97: right with technology 10 years ago robots wouldn't have been able to do this pretty well and it would have been expensive now roombas you know there's a hundred million roombas and other similar products that have been made so when you go to the factory in shenzhen and you describe that product they're probably 90 percent of the way there in terms of your product design the wheels the the computer vision you know the the depth and it knowing what the sensors where it is and the depth and the being able to create a virtual map all that software has been built right it's been around for a long time so when you make the lawnmower version of roomba you're kind of standing on those shoulders and the roomba is standing on the shoulders of all the sensors inside of mobile phones back to the mobile SPEAKER_28: phone revolution boom yeah i mean and what that mobile phone point means is people can use these robots from dusty robotics anywhere in the world eventually because you'll be able to put the SPEAKER_18: software onto your phone and then make it work uh because we're talking so much about dusty let's SPEAKER_47: give them a couple of points here according to crunchbase their last fundraise was series b of 2022 45 million 250 post and money from scale venture partners root uh cantos canaan and baseline SPEAKER_18: there's another company that actually i did not put into this list because i couldn't find a great video to share on the uh on the uh the podcast today but advanced construction robots is doing SPEAKER_73: concrete rebar tying have you ever done this i have not but rebar is gnarly and concrete rebar SPEAKER_17: tiling is hard so what you do is if you if you don't know you rebar crosses each other and what you SPEAKER_47: need to do is take metal wire and wrap it around them and then twist it off so it's tight that way the rebar stays rigid in a shape so you can pour concrete around it and what this does to your SPEAKER_18: hands is cut them up into confetti and you end up with just just as you said gnarly messed up hands and arms and so when you're talking about like you know 10x better yeah that case 1x as long as it's just not us doing it it's going to be a hit but it's so exciting jason to see the number of companies building awesome things to build more houses because it gives me optimism that the housing crisis in the uk SPEAKER_47: and in the us and in canada that we might actually be able to rectify that and make a profit while we're doing it so it's a win when and i love having a little hope and i also saw a robot that SPEAKER_64: it was doing and i don't know if it's a startup or not it was a proof of concept but there was a brick SPEAKER_63: laying robot and that to me was also very interesting because you think about backbreaking SPEAKER_64: work and it's not like bricks are going away bricks are like part of society you you you clear SPEAKER_14: a field and you dig something you have all this clay you got to do something with that moved earth SPEAKER_35: you start making bricks so the making of bricks is something that could be done by a startup and the laying of bricks could certainly be done uh by a startup and you know i wonder if the laying of SPEAKER_97: bricks or the 3d model which one of those would be more cost efficient eventually oh here it is SPEAKER_28: yeah this is a dutch company called monumental and uh it's on our list that we're going to add to the SPEAKER_18: twist 500 uh robots that bring bricks robots that place bricks and i have done well i've done rebar tying and i've also done uh brick lane and let me tell you it's really hard to do well so if there's a robot that can do this i'm totally into it and you know what's cool about this jason it's not fast but it works as you said the other day 24 hours a day yeah and you can get so much done and i just i SPEAKER_30: want more people to have more space and more safety and more security and more just home so this this this SPEAKER_18: this has been a really fun set of companies to add the twist 500 because fantastic go to twist SPEAKER_398: 500.com we're building this with our friends at coda we're not the sponsor of it we just picked the SPEAKER_259: best tool for the job code is a really great tool for this kind of job i have sponsored the program before so just shout out to coda i really just love your product to the team over there we just met SPEAKER_39: with them actually um oh you did uh yeah bianca and i met with him yesterday and uh if you now go to twist 500.com one the www should be fixed and resolve domains look it no no i love getting down SPEAKER_399: the punch list and doing the bug fixes yeah it's great it's that should be fixed now if it's a problem SPEAKER_18: email me good um but also we've we learned a lot about how to use coda in a public setting so now there's a lot better sorting groups and so forth and um if you get if you give us another two days of everyone's patience as we put our learnings into effect it's going to get super duper cool i think it's SPEAKER_30: gonna be awesome as a tool and also just as a web property to go and visit so well you know i just SPEAKER_54: want to build on your ideas here you know in this collaboration that you and i've been doing uh for a month now and i really appreciate you coming here and doing the show with me because it's made it SPEAKER_55: really enjoyable for me uh so thank you uh heartfelt thanks because i look forward to our time here SPEAKER_33: together um i wonder if it would be fun for you and i to take you know when we when we get these lists SPEAKER_03: and we we kind of build up our knowledge of them uh we could do like a little series here you know where we say hey you know we really you and i fell in love with construction or you fell in love with construction sure we get the producers going we say you know what let's bring 10 of them to new SPEAKER_64: york uh la san francisco or austin you know whatever great city and uh we just do a twist live or uh with those members of the twist 500 and we just invite them it doesn't need to be like a money-making thing just be like intellectually curious for us to say to those members hey there's 50 of you SPEAKER_14: in construction we have this theater you know our friends at microsoft or google or you know dell or SPEAKER_54: oracle they always you know they're very kind to us and will uh give us their their conference space we SPEAKER_05: say hey can we use your conference space we got 200 seats and we just have those 50 companies over two days present what they're working on the latest take a couple of questions it could be like a really SPEAKER_14: fun thing to do based on this research we're doing yeah and then i am building on that i've been thinking about what we're actually building is like a mutual fund index right um in some ways and so i was wondering if you know as we get good at this if we said i wonder if we could acquire shares in so we let's say we do the construction and we say there's 50 companies here yeah and um we think these are the 10 best of the of the 50 we're going to raise a fund to acquire shares in the research we've done and what we think the 10 best privates are so we're setting up a 20 million vehicle yeah SPEAKER_35: uh to go buy secondary in these specific companies um and so if you own shares in these companies you're looking to sell them we're we got the process going here could be like very interesting i think all this work we're doing for you and i to understand the ecosystem better and not do all companies like you SPEAKER_369: did at matter mark uh shout out to matter mark who's the founder of matter mark danielle moral SPEAKER_58: oh she was so great i love d she's fantastic d was awesome what a great idea for a company it SPEAKER_35: didn't work out it was crunch base before crunch base um and uh pitch book you know those being comprehensive is noble and awesome but skimming the cream you know in terms of investing and understanding deeply the dynamics of what makes companies work is going to be a really great a partnership for you and i so those are the two things i've been thinking about so i don't want to SPEAKER_44: turn all my cards over but obviously don't worry turn the cards over i'm taking notes as we go SPEAKER_262: through here by the way if you're curious what it's like to work uh for jason it's a lot of that by the way like you're just hanging out and he's like oh by the way um what i want to do is set up uh SPEAKER_144: a series of spvs i want to do a global tour with google's theaters alex can put that together right good all right so and you know what we get a lot done i'm not gonna um here's the thing David Friedberg: if you hire great people um who are you know gsd people um and who are just positive you know you you can get a lot done if you know you get rid of the the what i call the eors you know that you SPEAKER_05: can't it can't be done people when i even just brought up the concept hey i wanted this like twist 500 thing i just for my own intellectual curiosity i'm having a hard time keeping in my brain what are the most important companies yeah and uh you know everybody was like okay great i'm like like let's make it into a database use coda works for that boom the amount of time people spend SPEAKER_421: debating and discussing things i find sometimes is greater than testing things yeah i i think you SPEAKER_18: have to be willing to be five percent more vulnerable than i think most companies want to be because like you know right now if you if you go to twitter.com i'll confess this uh there's a an erroneous entry entitled alex listed as a unicorn that we were doing as a test case when we were learning something that i forgot to delete afterwards so you have to be willing to have a little mud on your shoes if you're going to do this live sure but companies like beehive are building in public yeah SPEAKER_17: and they're sharing as they go and i to me it makes me care so much more about the success SPEAKER_309: or using sub stack right now uh i use sub stack for my newsletter because i was already there but the um plus 500 newsletters on behalf so i use bi every day are you tempted what do you what's your take SPEAKER_14: on it because it does seem like they're going faster than sub stack now i just had a very high profile SPEAKER_81: person tell me they're leaving sub stack for beehive and they were just saying the product SPEAKER_144: velocity at beehive is really good the product velocity of beehive is good the people are awesome and they they're very much like newsletters they have that like high high like high energy that SPEAKER_18: zenergy you might say uh and they also have an ad network that i'm very interested in but i still feel like i'm still in experimentation mode and just because i'm having a baby in less than two months i'm gonna probably not throw extra yeah complexity into my life until switching costs yeah yeah get that baby out alive fed and then i'll swap urls um but jason before we go a couple of things for everyone SPEAKER_47: everyone to remember first of all like subscribe comment if you're on youtube or the live streams with us and the launch accelerator cohort number 32 is live the companies are chef reaction ellis layer path master tech ai rough up at the ph and then cario q-u-e-r-i-o make sure to take a look at them cool companies i got to take a peek at all of them yesterday for the newsletter excellent yeah SPEAKER_35: we um are trying to one of the efforts we're going to make here is to have what we're doing in the SPEAKER_97: investment company and what we're doing on this podcast just a little bit tighter bianca's been doing a great job uh bridging those two groups and uh yeah congratulations to the people in our 30 second cohort if you don't understand what an accelerator is it's um usually do seven people per cohort we might increase it a little bit because we have so much demand and we'll give those founders 125k and uh we're okay losing it we're looking to make high risk bets here um typically the companies SPEAKER_369: have a product in market and mvp they might have between three thousand and fifty thousand dollars a SPEAKER_14: month in revenue over 14 weeks we introduce them to 500 investors or more we help them with their pitch we help them with product market fit and then they're all going to spend uh um you know a little bit of time with me we're going to do some sort of retreat uh in austin uh hill country with some uh barbecue and uh you know hanging out and some casitas and uh you know just co-working together for three SPEAKER_54: or four days so i'm super excited about the la 32 retreat we're planning uh which they didn't know SPEAKER_316: nobody knew about until this moment so back to your my blank face was oh i wasn't aware of that we should do some live twist while we're there um absolutely we like to we really like to help SPEAKER_14: these companies get through you know the first what i call year zero when they're trying to figure out if they even want to do a company that's found a university um and then there's launch accelerator SPEAKER_259: which comes with an investment by default and that's like you kind of already got a product and you know maybe two three four people just like y combinator just like tech stars shout out to the SPEAKER_177: two davids at tech stars uh all right all right everybody that is the show we are back next week with more news jason and i will never stop but don't forget we also have the twist 500 newsletter SPEAKER_47: which is well worth your time and we will have a link to that in the show notes jason thank you we'll see everyone next week