SPEAKER_00: one of the great ironies is you and i don't talk that often because you're crushing it and this is one of the things i train investors your great investments you're going to just open up an

SPEAKER_01: update one day and it's going to be like oh yeah we're getting close to 10 million in revenue and when you invested they were at two or three thousand a month which i think is where you

SPEAKER_03: were in the accelerator and you're going to be like okay it all worked out and that student in your class if you will you know that padawan they just learned how to use a lightsaber and they crushed it and then the person you have to deal with constantly is the person who completely

SPEAKER_05: screws everything up and it's the problem child's that take all your time as an investor

SPEAKER_08: um you're the opposite you're that straight a student who just crushes everything this week

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SPEAKER_12: slash finn all right everybody welcome back to this week in startups one of the things we like to do here on the podcast is talk to founders that's why we called it this week in

SPEAKER_00: startups the show grew over the last 12 13 years um to five six days a week it's crazy right so much advertising so many topics so many great conversations we started talking about the news

SPEAKER_14: a whole bunch and then one of the things i realized is a lot of the companies we've invested in haven't

SPEAKER_16: been on the show in a long time and if we invest in a company that means we've got pretty great conviction right because skin in the game we've put money into the company we've placed the bet and so

SPEAKER_00: i'm going back to the portfolio i asked the people at our various programs at launch launch is the name of my investment firm go to launch.co to see a very modest website launch four is our fourth fund

SPEAKER_19: what do we do uh and what is our fund thesis we want to be the first fund to invest in a company

SPEAKER_00: and we want to be the first fund to hit 10 ownership in a company in a winning company i should say so let that sink in for a minute first fund into a company and it could be one of the first

SPEAKER_20: investors obviously you might have some angels friends and family the founders themselves might put in

SPEAKER_00: money but as a general driving force first fund into a startup and then the first fund to hit 10

SPEAKER_19: in the winning companies how do we do that well we have founder university a 12-week course uh you can go to founder.university where we meet teams of two or three typically builders who are building an mvp

SPEAKER_01: they may not even be incorporated yet and we came up with a new idea we'll give them 25 000 be their friends and family their rich uncle their rich auntie who puts that first 25k in just to pay the legal bills and you know get started pay for some server farms whatever and that's worked out delightfully we've made about 30 of those investments that allows us to start the relationship with the founder and then we have launched accelerator which is a contemporary to y combinator and tech stars that program puts in 100k for six percent we work with founders for 12 weeks to try to help them refine their

SPEAKER_19: pitch any in fact refining your pitch generally means refining your product your customers uh and and

SPEAKER_01: really refining your business at its core because when there's a broken pitch there's typically a broken business model or a broken product and so we work with founders for 12 weeks and then we introduce

SPEAKER_00: them to over a thousand investors and hopefully they get 100 to 200 meetings if they get 100 to 200 meetings i in my experience over the last decade of being a fund manager they got a good shot between 100 and 200 meetings and the fact that we've invested they got a good shot at raising a seed round doesn't always happen uh sometimes businesses are too uh avant-garde too cutting edge and people don't get it yet and sometimes maybe investors do get it and they don't see a big enough opportunity so with all that uh here we go back to our knitting at this week in startups talking to the founders that we've

SPEAKER_01: invested in now ray's company uh is called irate i remember this company coming to our accelerator uh ray weisberg welcome to the program have you ever been on this week in startups no first time there we go so we're doing our job we're going back through the portfolio and catching up with our

SPEAKER_00: founders uh you came to the 17th cohort of launch accelerator probably in 2018 2019 no 2020. yeah yeah i started in 2019 going into 2020. got it um so when we met describe what the business was uh and what your original idea for irate was and do you remember us meeting for the first time i always like to ask that question because i can't remember anything anymore because i've met so many startups it

SPEAKER_38: blurs into one giant podcast meeting yeah um i can start with the original idea um for irate it was right before we met the original idea was point of sale reviews on an ipad it kind of was formed out of a pivot from the sequoia back startup my co-founder michael and i were working at um terrible business model we're putting ipads in a business where customers would rate the business and leave um it didn't work customers wouldn't go to the ipad we had a background as service employees so we sat in these businesses and thought through what it would take to get customers to go to the ipad and we came up with attaching employee incentives to customer engagement rates um ipad example of a business that would do this um companies like massage envy european wax center um fitness industries something where

SPEAKER_00: there's a service provider who is representing the business if you're getting waxed that person represents the business that's a pretty intimate painful i haven't done it but from what i understand or if you're getting your hair cut or you're getting a massage your experience with that or getting your haircut your experience with that brand is the person is it not correct correct and they're the face

SPEAKER_49: and the voice of the organization so ipad didn't work we put it in the cloud integrated with the

SPEAKER_38: point of sale and what we do is pay service employees to get mentioned in online reviews if customers have

SPEAKER_19: great experiences so so that was the insight was these service businesses are driven by the yelp

SPEAKER_01: google whatever reviews i think yelp and google are the top two i guess is that one and two or two and one

SPEAKER_38: yeah yeah we stay away from yelp um but google is anytime you're searching for a new business you're going into the google search and you want to show up first got it and so you realized hey they need to

SPEAKER_19: get more reviews and they want authentic reviews and the business is occurring between this service provider giving you a haircut giving you a massage uh and the uh customer but they don't want to type the review on an ipad at the front desk that is super awkward yeah but they might one in

SPEAKER_00: 10 or one in 50 might want to write a review because they really love their haircut correct

SPEAKER_38: correct and they have a solid relationship with the employee and um that was our unique insight we came from a background of service employees these people are um under recognized uh underpaid but they're the real driving force for the business they're getting customers to come back they're increasing sales they're um representing the business's brand online if they give a customer a terrible experience that customer right go shout out the business in a bad way online on the flip side if it's a good experience they'll mention the business they'll mention the staff member and write

SPEAKER_01: some great content got it and so this manifests itself how the haircut the person giving the haircut or giving the massage says hey would you consider writing review or they hand them a card that explains what to do

SPEAKER_38: yeah that's one way but we integrate with 50 of the leading point of sale companies companies like mind body and the way it works is imagine you go into massage and be you walk out you get an automated message in real time say hey thank you for your visit please rate your experience with your massage therapist jennifer today if it's a bad experience then we'll filter you back to the business owner where the business owner can chat with that customer resolve the issue and then we'll track retention numbers on it if it's a good experience well i say hey glad you had a good experience click here to mention jennifer by name in an online review and each time jennifer gets mentioned by name the scraper picks up on it and it pings jennifer through a mobile app where she can go in see your review see your customer feedback and cash out instantly directly through the app almost like venmo

SPEAKER_00: that's fantastic and you know when i heard this idea i immediately said i don't know how big this can get

SPEAKER_19: but i know that this makes sense to me and of course everybody says when they hear you know some very um specific idea like this oh maybe it's too niche uh so i think you did get that feedback from a lot of the investors we introduced you through through the accelerator is this too niche and so explain to us

SPEAKER_01: how the business has grown over the years since we invested and i guess we made our investment you know

SPEAKER_15: back in 2020 it's it's been now three or four years so so how's it gone i mean it's gone really well

SPEAKER_38: we're in 4500 businesses there's 90 000 employees on the platform holy um approaching 10 million in revenue and um last year employees on the platform hit a million dollars earned and this year we are on

SPEAKER_69: pace to help employees earn a million dollars um per month by the end of the year so you know what i loved

SPEAKER_01: about your business and i think i talked to you about it at the time was i remember getting pitched

SPEAKER_19: on businesses um or having people back channel to me who had businesses my god there are these pr firms

SPEAKER_03: uh these social marketing firms that have baked accounts on various platforms i'm not going to say which and they've baked you know user review accounts and they will go to a business and they'll write three negative reviews i literally had this explained to me they'll go in they'll literally go sit outside

SPEAKER_19: the business so they can get their ip address close to the business they can do the check-in feature or whatever um they can sort of do some um proximity based review they write three negative reviews they do it in a really deft way because they know what reviews will be voted helpful or will resonate and then they will come back to those businesses a couple of months later when they've been impacted by negative reviews and say hey i noticed you have a couple of negative reviews we have a solution for

SPEAKER_01: this we have a group of really elite people who we can pitch on writing reviews and we can turn this around and if you give us a thousand bucks and a thousand dollars success fee whatever or give us two thousand dollars a month sign a 12 month contract we can do this this was the state of the business

SPEAKER_19: before you got involved and when you got involved i said this seems like a much more aligned with the truth and honesty if you didn't like your haircut from susan or john there's no way you're going to write a glowing review there's there's nothing in it for the reviewer yeah but if you do like it

SPEAKER_01: you are gonna write it because hey you probably appreciate the fact that susan did such a great

SPEAKER_82: job cutting your hair yep and so it worked and tens of thousands of people are now using it congratulations

SPEAKER_01: along the way we've uh invested a couple times in the company uh so thank you for allowing us to do that

SPEAKER_00: when you're selling to uh b2b decision makers they're hard to find aren't they we try to do it on a social network where people are doing dance moves or arguing over ukraine that's not where you want to

Chamath Palihapitiya: be trying to find b2b decision makers who are in the mindset of making a purchase no you want to find those business leaders on linkedin now linkedin has 930 million members ready to do business with you but what's really important is they have the 180 i'm going to lower my voice here they have 180 senior level execs plus they've got the 10 million c level execs that's people like me the c's the c suite it's so sweet when you can reach the c suite and linkedin's got 10 million of them go reach those elite buyers where they live and work all day long linkedin equals business and business equals linkedin it is that simple and if you've never used linkedin for advertising it's time for you to learn how effective it is and i want you to learn with a hundred dollar credit from me your boy jacow getting you the hundy so you can get in the game make b2b marketing everything it can be and get that hundy for your next campaign go to linkedin.com this week in startups to claim that hundred dollar credit that's linkedin.com this week in startups no spaces no dashes terms and conditions

SPEAKER_57: do apply because they're giving you a hundy talk about how this has grown as a business and what

SPEAKER_01: you've learned you worked at a startup before this yeah but this was your first essentially venture backed startup so what did you learn from the time you were at our accelerator not to make this an ad for the accelerator but just your story of hey what did you learn not just from our accelerator but just being out there in the field for the last three or four years about developing a product and delighting

SPEAKER_38: customers those two things specifically as granularly as possible yeah like start with developing a product like for us we never wanted to build a slightly better reputation management company slightly better review company for us it was about category design how do we create a brand new category we called it employee driven growth um and then become king of that category and take market share so we took our unique product insight on employees earning incentives for getting mentioned in online reviews by customers and then the whole product roadmap was set up to help employees earn more for growing the businesses they work for so we developed something called scoreboard because we have the point of sale data where it's an automated sales competition on the highest revenue generated specific products the retailer or a brand can set it up and it helps the employees earn more for selling specific products or hitting revenue targets and it increases revenue for the business um increases earnings for the employee and if you look at the product roadmap um now and over time like you know we'll do similar stuff to competitors in the market but we're always attaching employee earnings to whatever product that is and it takes a lot of iteration a lot of prototyping like we believe in very fast prototyping and tests and

SPEAKER_12: killing products that don't work and we do our best so that's product velocity you gotta run experiments a

SPEAKER_19: little bit of lean startup in there uh and just moving fast but creating a category is the thing that i think is the most interesting you're not copying anything that existed in the world and so you branded this you said hey this is employee driven growth and so let's talk about how you came to that

SPEAKER_85: name slash framing because that framing yep is so brilliant it's such a brilliant frame framing how you look at the world right you can look at the world in many different ways for people who don't understand the

SPEAKER_19: concept of framing framing is a psychological term and so there's something called attribution theory you can look at behaviorism and some other schools of psychology and this is i was a psych major really has helped me in business but framing and attribution theory is how you attribute things that happen in the world so if you get caught uh for speeding on the highway you could say i'm an idiot for speeding be self-loathing you could say this cop is corrupt uh these goddamn cops you can attribute it to them

SPEAKER_85: or you could attribute it like i do hey ah i like to go a little bit faster and that means i'm gonna get a speeding ticket every year or two therefore it's a donation because that money goes to my local

SPEAKER_19: town or that local town and they probably put it towards education uh or this cop's not making a ton of money anyway and they're just doing their job so i'm free of any pain or suffering your framing here

SPEAKER_03: is so brilliant because you're saying the employees are driving the growth and if you're a business

SPEAKER_85: owner you know this to be true and so if you come in and say hey we're an employee uh driven growth

SPEAKER_03: platform oh my lord that just snaps into place for the employer and the employee because the employee could

SPEAKER_00: say uh you know oh yeah you're right i i am the one who drives the growth here and then the employer can say i know that you're driving the growth here and i want to see you get an extra 10 bucks every time you get a great review and that is that what it averages out to 10 20 bucks that seems to be what

SPEAKER_38: i remember yeah if we set it up it's five dollars if the business sets they can do flexible rewards and they can pay employees as much as they want what's the most the business has paid um we have a business that has 51 locations um that is paying out fifty thousand dollars per month to their employees

SPEAKER_125: and per review um fifty thousand in total yeah and then what per review yeah that would be a big bounty 20 25 per review 25 per view that seems like a really smart business i'll be totally honest

SPEAKER_19: because these reviews are you know amazing so let's talk about that framing when did this land in your consciousness was it um from day one because i don't remember hearing this in the accelerator all that much uh when did when did you click in with this framing of employee driven growth um it's it's been

SPEAKER_38: recent it started um early on when we're going through the accelerator with our unique insight the

SPEAKER_51: you know service background how we differentiate it in the market um we got introduced to a book called play bigger um which really framed this i think late last year and then worked through it with our

SPEAKER_38: head of product tom shawl and we created an internal pov um just an internal document that talks about the stakeholders the employer the employee the state that they're in today how they're wasting all this money on marketing how to solve this really tough problem and then the employee driven growth philosophy and what happens after that what's the future state we delivered that internally we put it into marketing messages we put it on linkedin into a product for testing called payposts where our team um posts about employee driven growth and tags iterate and earners cash for it um it just started yeah and it just started taking off we're doing a name brand and a name change and a rebrand that aligns directly with employee driven growth so that's coming soon and kind of it will help us get out of this like hyper competitive review space like we don't want to compete we want to create a brand new market take

SPEAKER_58: that industry from zero to one and become category king of that so you see this not just being for

SPEAKER_12: massage therapists and and uh salons and hairdressers it could also become something that a venture

SPEAKER_03: capital firm could use uh or a sas company could use for sure for sure for us we stay hyper focused

SPEAKER_38: on a couple industries at a time get to critical mass and uh move on right now the products set up for

SPEAKER_51: um retailers and small businesses i think in the future there there's possibilities to build for the enterprise

SPEAKER_12: well listen congratulations on all this the the results speak for themselves uh customers love your product

SPEAKER_141: uh the uh employees inside of the company love your product and i love you your team and and you guys for allowing us to invest in your company and really come along for the ride so thank you for letting the launch fund and launch accelerator participate really do appreciate it um you know and i hope we've been of great service to you when you need our help

SPEAKER_00: help one of the great ironies is you and i don't talk that often because you're crushing it and this is one of the things i train investors your great investments you're going to just open up an update

SPEAKER_01: one day and it's going to be like oh yeah we're getting close to 10 million in revenue and when you invested they were at two or three thousand a month which i think is where you were in the accelerator

SPEAKER_03: and you're gonna be like okay it all worked out and that student in your class if you will you know that padawan they just learned how to use a lightsaber and they crushed it and then the person you

SPEAKER_05: have to deal with constantly is the person who completely screws everything up and it's the

SPEAKER_07: problem child is that take all your time as an investor um you're the opposite you're that straight a student who just crushes everything so i just really glad that we got to be part of this and the best

Chamath Palihapitiya: is yet to come listen i'm doing six podcasts a week it's not easy i love doing it you love listening and we all learn so much but dealing with video it is so expensive it's so time consuming right but you want video because videos go viral all day long how many times does audio go viral very rare

SPEAKER_85: i i couldn't even tell you if you ask me now tell me the three times the audio went viral in the last

Chamath Palihapitiya: year i wouldn't have one example for you but i can tell you a hundred different videos that have gone viral in the past year so if you want to start leveling up your clips game and make really tight viral clips that will bring you customers that will build your brand that'll help you hire people that will get you venture capital investment well you want to use veed veed it's a web-based video editor and it's going to make life easy for you and the best part you don't need to have video editing skills now veed has editing features built into it like auto subtitles or you can remove background noise or you can resize it so you're not sitting there looking up how do i do this how do i use these crazy expensive video editors nope they have all these ai tools that make editing faster and easier hundreds of plug and play templates and more veed lets you do it all without having to spend hours learning complex editing software or paying third parties so start engaging your audience on any of the major platforms by heading to veed.io and start creating professional quality videos in minutes that's veed.io to sign up

SPEAKER_147: today can't wait to see a 10 exit from here uh which i guess is going to require a little more capital

SPEAKER_03: and continuing to upgrade that management team and add talent yep now that you and i think this is a hard discussion to have so what what do you need going forward in terms of your team and experience that you know getting from zero to 10 million is one thing yeah but you we you and i both know 10 million to 100 million you're going to need a group of people who've done that jump in all likelihood i mean i have seen teams not do that but they they tend to struggle so what do you need to do as a founder here because you've never run a hundred million dollar company in fact this is your first time running a company that's just about to hit 10 million in revenue so what do you have to do to

SPEAKER_38: level this company up and the management team in your mind yeah really really good question um i think you know one we don't have a marketing function in the company right now that will help the sales team

SPEAKER_158: is that we're a marketing platform we don't have anybody doing marketing i think it gives us a bit

SPEAKER_160: of a unique perspective you know it's actually helpful because you have marketing pull you have

SPEAKER_00: you have you know you know what product market fit is obviously that's when you know a market and a product you know click in but when you have market pull which is what you have you have people who want to use this product and selling it and they just use it more and more you get into 10 locations you're going to go to all 100 if you have 100 locations you're going to go to all a thousand

SPEAKER_73: you have market pull so you don't need marketing you know who else had market full elon with tesla that car was so fantastic sorry you blew that out that car was so fantastic that when i had one i used

SPEAKER_03: to tell people want to go for a ride i'll show you all the features and i had a talk with elon at one point i was like you should do something like tesla rangers or like a tesla affiliate program and i take no credit for elon's work over there but he did obviously create a uh he created an affiliate program where people could share um that they uh you know their unique url uh after we had that

SPEAKER_01: conversation and that worked out really well some people wound up getting a lot of credit for selling model threes but my idea was if you had these rangers uh tesla rangers they would go drive the car range right that's my yeah he never did this one but i said hey you could drive the cars somewhere and they uh would give rides to people and if that person wound up buying the car you could give them you know whatever 100 or 500 towards their next car so i think that's what you have is you may not

SPEAKER_19: need a marketing department as much as you need content being created on a regular basis by you and

SPEAKER_01: your team to showcase how effective this is and just take a victory lap and give high fives and um but yeah so marketing is definitely one you need uh but you should be thoughtful about what it is i think

SPEAKER_03: just explaining what you do is enough i don't think you have to do hard a hard sell here it's just pretty obvious i think have you done case studies that's always a great way to okay letting customers speak for

SPEAKER_01: you as you know is the greatest reference which is literally what you do so when we do events uh we ask people to review the launch accelerator or founder university or whatever it is and we say can you write us like a three sentence yelp or google review like review about our business and then we take those and we'll put it in our marketing but yeah that's yeah marketing and growth marketing growth hacking that's definitely something to build at scale and that means taking a two-year approach not just a week a month to month week to week marketing plan but i would encourage you to build a two-year

SPEAKER_15: marketing plan what is this marketing team doing in two years you know what does it look like in two

SPEAKER_01: years if we do eight quarters and we take a quarter by quarter approach quarter one we get this you know we get the blogs going quarter two we get the case studies going quarter three we get our regional report on local business health whatever it is and i love what zillow did i we had um i had at some point i'll have the producers look it up god this is where i need an ai search engine

SPEAKER_03: for three startups we had the cmo of zillow and she was phenomenal and she was on the she spoke at a couple of our events and you remember they did zestimates and remember zillow did reports on local markets and redfin also did this and they got local news to use the local data it was such a brilliant move so the health of the local markets could be like hey here is the reno here is the phoenix uh you know or even the tempe you know here is the austin local business report and here is how local businesses are doing anyway there's something there around that um so you think marketing anything else

SPEAKER_181: you think you need to level up finance sometimes that's hard at a company is it time for a cfo yeah well

SPEAKER_38: our coo is running both functions he's a co-founder um uh eventually i i think that's a function we'll need to hire for um i really think just finding a like some executives can scale through the different phases of growth um it's rare but finding executives that have gone from 10 to 20 and maybe that's not the same executive that's going to go from 20 to 100 and it's painful conversation sometimes and sometimes people you know you're asking them to do almost a brand new function at at that level of scale so i think that's important um and then just keeping it candid with the the founding team i'm

SPEAKER_51: just so i feel so fortunate to have met um michael uh aradondo mitchell aradondo mike pierre i don't

SPEAKER_38: know if you remember but as we're going through the accelerator we're selling to franchise health and beauty and our revenue went to zero for like three or four months and we didn't have we had you know barely any cash in the bank we had a team of 10 or so and it would have been really easy to to give up then but we kept it candid um in a harmonious way forced each other to level up and um i think as we're going through this like our the founding team our number one skill set is just not giving up and not quitting um and making sure that stays top of mind for the founding team and then building executives around us that have done it before is really important i think that radical candor super

SPEAKER_00: important if you're into uh radical candor highly recommend kim scott uh episode of this week in startups and even better than my interview with her she did a master class kim scott uh from google

SPEAKER_01: and i knew her at a company before google um you can uh go check out her master cat class on radical

SPEAKER_177: candor was the name of her book but she just has a master class on tackling the hard conversations with radical candor i have a promo code for master class they've advertised here but i don't remember

SPEAKER_01: off the top of my head kim scott was on episode 965 thanks to my producers and somebody on my team

SPEAKER_176: please put all these episodes in ai so we can just ask the twist ai i do think getting a cfo in when you

SPEAKER_03: get to shorts 10 million is a good idea because uh respectfully to the coo um how good can you be at operations and uh you know finance with so many hours in the week and also yeah uh if you think of the bar raising technique do you know about amazon's bar raiser concept okay so um these interviews are going to become like mini uh you know jcal and founder uh jam sessions here yeah go to masterclass.com startups to get 15 off i'll put a promo um so bar raising there is an amazon book uh and at amazon uh working backwards is the name of the book and we did a book club on it i don't know what episode that was but a bar raiser is somebody you hire this is one of bezos's great innovations shout out to jeff bezos uh who just started following me on twitter thanks jeff bezos um a bar raiser is somebody you hire

SPEAKER_00: who raises the bar inside your company because they know more than the existing team so if you were to hire somebody who you know worked at zillow in the marketing department obviously they know more than you and i because they did it if you were to hire the cfo from slack or salesforce or you know in the early days well they've done it so therefore they're a bar raiser and so if you go to um just do a

SPEAKER_141: google search book club with jason working backwards this book is so good in terms of it changed my thinking and i don't think we ever i'll put it in the show notes for everybody if you do a google search book club with jason working backwards this changed my thinking on a lot of things also they

SPEAKER_00: have a right first culture have you heard of that before right first culture right so you know when

SPEAKER_15: they go into meetings they write this is the new product or service we're going to do and they do what's called the six page or it doesn't have to be six pages but they do the internal faq the

SPEAKER_00: external faq and they basically have people write down in plain words not powerpoints what the plan is and then they will write like a press release that they would give to the press uh or the announcement to users before they build the product why do you do this well if you can anticipate all the great

SPEAKER_03: questions that consumers are going to ask or people internally at the company are going to ask and everybody reads it at the start of a meeting so they have this bizarre weird moment like it's a cult

SPEAKER_01: where everybody closes their eyes or turns off their camera and they read ray the document so

SPEAKER_19: everybody's sitting there on there with their cameras on reading it it's a thousand words okay it took you six minutes who reads it everybody takes notes and then everybody asks questions based on what they just read and you don't go spend 45 minutes in a powerpoint deck where everybody's secretly doing their email

SPEAKER_15: it is so transformative and then i did this when we were launching we're raising our fourth fund now

SPEAKER_141: you'll be an lp and fun five when you take this company public my master plan people we find to

David Friedberg: become billionaires and then they invest in our next fund it's great uh no conflict no interest but

SPEAKER_00: anyway um if you go to launch.co slash memo i wrote a deal memo about our fourth fund and our strategy and this deal memo when people read it they understand our strategy when i walk people through a powerpoint they ask me questions that are answered in the first two paragraphs of this and the retention and knowledge of our strategy goes way up when people read it turns out reading versus watching powerpoint decks just complete different so i really encourage you to do i would just do this right now how many team members you got um close to 60. holy cow just by working backwards for

SPEAKER_141: i don't know all 60. uh it'll cost you whatever 20 bucks per book you just do the math it's like 1200 bucks or something and then have a book club one saturday or one thursday night send everybody uh you know an uber gift card to get pizza or something and then do a book club and watch the

SPEAKER_03: organization level up because amazon figured out how to have like a very operationally excellent company

SPEAKER_228: all right listen i talked a whole bunch here but i i i'm going to use these segments and i appreciate you being open-minded to doing this you're the first i'm using these segments to catch up with my founders but do like a public jam session with them is there anything else we can be helpful with uh you know as we wrap up here as investors things that you need uh seems like you're in great shape but if there is uh you know please ask any questions no thank you so many not just recommendations um

SPEAKER_51: like you had there i think as we're um going to the next fundraise you've been great with intros um intros through jackie um are always my intro machine yeah when people when you when you get

SPEAKER_141: intro'd um just since i have old information here because i don't do all the intros anymore because it's uh doesn't scale but when you get intro'd as a launch company or people know that we're on the cap table and we're involved does it does it help a little bit with the friction or getting meetings

SPEAKER_38: for sure for sure like we raised the pre-seed through an investor that we met during the launch accelerator we got an intro to them they didn't invest in our space so we probably shouldn't have taken the meeting but they intro'd us to another investor world-class investor that wrote a check

SPEAKER_58: really quickly so fantastic helps a lot how many when you were doing that seed i always tell people

SPEAKER_141: between 100 and 200 emails to get to 50 to 100 meetings to get to 10 investors you know close

SPEAKER_247: seven of them what was your what was the numbers in that funnel uh when you when you raised your round

SPEAKER_248: yes probably 100 emails maybe 20 meetings and a couple investors participated great amazing all right

SPEAKER_228: listen uh so proud of the work you've done thanks for letting us come along for the ride uh we were one of your first investors and uh we'll be with you uh till the end and and beyond so keep keep grinding if you need any help you let us know and then uh hopefully come back in a year or two uh we'll get an update on the business and we'll have a conversation about going from 10 to 25.

Chamath Palihapitiya: cool appreciate you having us all right thanks right finn can't spill coffee on a white shirt or wave at someone who isn't waving at them or burn its mouth on hot pizza but finn can resolve half of your customer support tickets instantly before they reach your team what's finn finn is a breakthrough ai bot from intercom designed for customer support teams and ready to put other chatbots out of work it learns your entire knowledge database and has the ability to carry conversations and remember context and nuance while slashing your resolution times and support volume meet finn a breakthrough ai bot by intercom ready to join your support team today visit intercom.com finn all right next up on the program

SPEAKER_94: everybody is you're not going to believe this we got him back the one the only the transcendent there can

SPEAKER_203: be only one deep tech investor with this track record mr steve jervison came to angel summit he held court he shot the long ball three pointers he dunked he mesmerized this audience of 120 or so capital

SPEAKER_228: allocators he's the og invested in spacex tesla hotmail this guy's been around for a long time i'm not saying he's old but he's got that wisdom he's young at heart with the wisdom of yoda vc yoda steve jervison uninterrupted for the next 30 minutes for you the loyal this week in startups audience enjoy

SPEAKER_261: our next speaker is absolutely extraordinary we're lucky to have him it's a legend in the venture industry original investor in tesla spacex so next up steve jervison well i'm going to just

SPEAKER_262: try in a brief moment to give you an introduction to the way we invest in disruptive technologies explain what we mean by that the origin of where disruption comes from i'll use space as one example simply because spacex companies like that are very visible everyone thinks they know a bit about the business because it's very visceral when they blow up it's sort of failure to launch becomes visible and uh it's maybe an iconic example of something that very few of us probably thought was a venture investable category you know in the 90s when it was all internet semiconductors and biotech and that was pretty much it and now it's cars it's agriculture it's energy the entire eco of sort of economy rather is opening up to venture uh investment that's because it's opening up to entrepreneurial disruption that's what i want to focus on in the beginning just one slide for background and context these are the kinds of things we invest in they're all over the map by design because our filter really is that we try to invest in companies that are unlike anything we've seen before yet adjacent to where we've been so it's this ever set of expanding frontiers now on more domains and sectors than ever before but when we first invested in these companies they didn't have a product or a prototype and they were generally regarded as impossible ideas when they succeed like tesla or spacex you can see how they've reinvented entire industries right the catalytic to change beyond just their direct sales or impact and we're hoping that'll be the case with others to come uh like commonwealth fusion and energy space or d-wave and quantum computing or even a tie in psychedelic medicine for mental health and try to reinvent the industry that when you look back 20 years uh companies that sort of led the tip of the spear of a major sea change so that's what we look for uh we don't all succeed of course in fact we fail about half the time but uh the filters that we use i'll explain later in the talk are ones where we try to look for that ability to find companies for which history books would be written about if they succeed companies that have an incredible trajectory looking at 50 or 100 years not 5 or 10. and so we set up our fund to be a 15-year fund i personally have never sold a share of anything i've invested in there's some domains of long-term thinking that filter through to the filters we use in the front end that come from the way we structure our work okay meaningful change so i mentioned that we uh try to invest in things that are profoundly going to change the world for the better or you know provocatively are so audacious that history books be written about them right and i think tesla and spacex will fit into that uh moniker i don't know about which others but we're hoping they'll have that potential but how can you even do this what does it take to have meaningful change and in every single case it takes what we would call some form of disruption it has to be a disruptive innovation or disruption in a market that's exogenous to the startup itself right without that the big keep getting bigger uh new entrants don't have a chance and it's just business as usual right so in autocracies like china in the long run i think you're going to see less innovation because you have less new entrance you have less disruption when a culture or modality be it the culture of a region or the culture of a people doesn't welcome disruptive change you have less change you have less innovation that's what progress is now where does this come from it's always led by new entrants this is the only rule of business i believe is inviolate meaning there is no counter example in the history of the world so let me be precise what i'm saying take any company that's large or let's say top three in their industry they will never lead the charge to disrupt that industry in recent years that may have seemed strange be like well what about apple what about hill packard what about google and i would all say no google's never going to reinvent search or advertising in the search context until someone else like chat gp does it to them and they play catch up right the same with apple they're innovative outside their core but never in their core business they haven't done anything laptops or servers for decades right nothing you can point to as an innovation from apple in what used to be their core business so big companies can be innovative when they don't innovate in their core but it is always a new entrant that will change an industry like the automotive industry or the aerospace industry that go decades without a new entrant decades without any change that anyone can point to that's meaningful or disruptive and then the teslas and spacex lead the change now where does this come from there are several uh on this list i won't belabor them a lot of these are one-offs every once in a while an industry gets privatized every once in a while it gets deregulated that creates new opportunities right sometimes there's a financial shock ironically big financial swings black swan events in the economy are great for startups right there was no better time for tesla to launch its competitive assault in the automotive industry than when all the other automotive companies were struggling with debt defaults and the possibility of bankruptcy right so tesla picked up a factory for 42 million dollars that cost a billion dollars of uh plant uh property equipment that was used those kind of opportunities are a form of disruption but you can't necessarily bet on it as a venture investor or an angel investor then there's these weird ones these new channels of distribution and i would lump the internet mobility as examples of this basically an entirely new way to mediate interactions with customers right just like dell was a beneficiary of an entirely new way to ship computers to customers the same is true for the internet and almost every consumer and business business you can think of and same of course for all the mobile apps that came now the last one is the one i'm going to focus on this is the one why i think is the reason we're in the room today the reason that there are angel investors and venture investors year after year decade after decade despite the sporadic but i mean no one i don't think is focusing on privatization as your investment thesis or deregulation right like good luck where are you going to look around the world for the next one right but every single year you can count more's law right this exponential change in capabilities that for whatever reason humans have an impossible time projecting with their linear projection of an intuitive intuition right so just like sony lost the walkman fast franchise to mp3 players and just didn't see it coming how could they not have seen it coming we just every single time people don't see it coming whether it's chat gpt or other forms of innovation and disruption today quick question how many people have seen or know of ray kerzwell's version of moore's law this is the abstraction of war's law that says the amount of computation that you can buy for a dollar i only saw one hand is that really the case wait hold keep them up so i can count okay like steve martin won't do that ten okay ten of you wow okay so i will explain this slide because i've been updating it from when kerzwell first published in 2008. so what you're looking is years on the bottom how much computation you can buy for a constant dollar the inflation adjusted which is what people buy right no one says hey intel give me a billion transistors i'd like to buy some transistors please right they say i want a certain amount of computation i want some storage you could plot either across many different technology stacks so now this abstraction isn't specific to intel it isn't expect specific to anything gordon moore talked about it isn't specific to the integrated circuit it's like the analytical engine the relay based computer that cracked the nazi enigma code vacuum tube based computer that predicted eisenhower's win etc discrete transistors those are different epochs in those gray bands well what kerzwell realizes astoundingly if you look at the best price performance computer of the day it's as if they were on a curve without knowing it right it's like spooky there are other computers below the line this is the frontier of human capacity to compute compounding uninterrupted and i'll show you an update to the present day that can that covers a 10 billion billion x improvement in price performance computing and has nothing to do with intel has nothing to do with integrated surrogate has nothing to do with anything we're taught about smaller better faster cheaper that's unique somehow to the integrated circuit era it's like kind of spooky almost college cosmological why has humanity's capacity to compute compounded independence of the economy world or one world or two the great depression you could sort of think metaphorically innovation continues unabated but this is the driver of everything you just heard about an ai being exciting in all these industries converting into something new like tesla and spacex are fundamentally software companies that is the basis of their competition it's all driven by this now i've updated this curve for the last i guess would it be 15 years and what's kind of astounding is the sea change blue would be the traditional compute as we know it you know single processor cpu kind of architectures green is nvidia so it would have become obvious in fact my mom realized this when i was selling a slide 13 years ago that she should load up the boat with nvidia stock um becomes more and more painful as obvious as you go along that intel is no longer the harbinger of progress there is no intel product for the last 13 years that matters in terms of the frontier of computational capture more recently they're custom chips called asics that are specialized for ai that are vastly outperforming those nvidia chips the video continues in green as you can see with the yellow and even the weirdest one this analog chip company called mythic it's even closer to the mimic of the human brain as an analog compute architecture that implements ai even more cost better price performance still and this is astounding again when you see a straight line on a curve like this it's an exponential every tick mark on that y-axis is 100x 100x 100x this is a slightly upticking turf so things like chat gpt sort of come out of nowhere and seem like magic almost everything in the deep learning feels that way initially autonomous driving even siri in the first few moments until it quickly became annoying um this is going to be our future on ever shorter time scale so you just heard an earlier talk gosh we live in the most exciting 30-year period ever but that sliding window just keeps going the next 10 years will be much more progress than the past 30. the next 20 years will be more progress in the past 100 by this metric alone and what happens as this goes up is the things that were not simulatable before like landing a rocket on its legs or the combustion instability in a spacex engine suddenly it can be computed in advance and you can run many more experience experiments in the simulation domain than you can in physical life so industries that weren't it industries start to feel that way right tesla can test billions of virtual miles of driving for the autopilot stack of software before people have driven billions of miles and that in a sense pace change puts the predecessors out of business right you can't compete with a software stack if you're doing a hardware iteration loop it's the pace of progress is just that much higher so what industries have been disrupted by moore's law the reason i belabored that curve was it drives almost everything right and almost every investment thesis you have or phrased differently think of any industry construction agriculture you name it energy and say what would be the basis of competition 20 years from now or 50 years from now and the answer will almost always be how they process information it won't be oh they had a monopoly on a certain mineral or a patent on a particular composition of matter right there is there are no patents at spacex or at least there weren't until recently and uh and tesla open source theirs it's not like there's a thing other than the software stack and the rapid iteration of the learning loop that is the point of differentiation so in the early days 90s or so computing networking telecom kind of obvious old school eye-opening for us and i think a lot of people in the public markets was like whoa what's going on in automotive and aerospace with spacex and tesla it was kind of a watershed moment might this happen to my business pick you know fill in blank and i think it will i think eventually all industries we we may be wrong on timing like five years too early or 10 years too early as i've sometimes been uh but eventually all these sectors uh are in various positions of transforming by transforming i mean was there a meaningful change you can point to last 20 years if not might there be one coming in almost every case there is so let me use space as just one quick example these are not um and uh these are real photos which is astounding in both cases right this isn't like something just made up uh in chat gpt uh and it really inspires the next generation of people in this sector but how did this happen like how did spacex come out of nowhere in what is normally a capital intensive business and still is in some ways um to be so profoundly transformative and might that be a template for others so the first thing is there are these things that just work the first time like these boosters landing back from the falcon heavy in synchrony as my wife and i saw i took that photo it's like holy like that actually worked um or flying the the dm2 mission with the human astronauts for the first time there are so many things that depend on the simulation stack so at spacex they build all their own software i mean everything like even the equivalent of your salesforce automation system and your sap you know and you know sort of management system for manufacturing they built the entire software stack they built their own simulation tools instead of using cfd modeling tools they built their own wavelet based things to predict engine instability and to predict all flights the point being the reason i'm belaboring this is a lot of this stuff is moved to the software domain of rapid iterations and they were thoughtful about using standard off-the-shelf electronics wherever possible like the same fpga control module for almost every control loop in a rocket it's just different software for is that a landing leg controller or a stage separation controller it's just all software and so having a common hardware reference platform and just off the shelf electronics everywhere nothing proprietary allows for more rapid iteration cycles the analogy i'd use is kind of like the phone in your pocket you know the next one's gonna look just like the one you currently have physically then one after that's gonna look exactly the same like it's long ago been that the physical thing became a vessel for code and services same for your car it's the software stack that matters 20 years from now you won't buy a car if you buy one at all or ride in one if you choose to ride in one as a service that has the worst autonomous driving stack right that will be the singular point of purchase it'll be an ai purchase decision won't matter if that one's got a slightly better battery or slightly better motor those will all be commoditized to about the same price point same componentary price for everyone there's some dislocations they don't last decades 20 years from now all you care about is a software stack by the way at spacex everything they make is a fully autonomous vehicle every stage of the rocket booster upper stage dragon space capsule both fairings the boats that go out to sea to retrieve them every one of those is a fully autonomous vehicle now what impact has this had on market share this is not to the present day it's only 2015 i'll give you an update in a moment only focus on the dark blue america used to have 100 market share in the 80s meaning if you had a commercial meaning a free market you're not like in launching russian or chinese military satellites you're saying i got a satellite i could go anywhere who's going to launch it for me it used to be united states it went to zero percent market share for three years in a row meaning not even u.s companies would choose a u.s launch provider because they were not cost competitive right this was the years of cost plus contracting and monopoly consolidation in industry that made just one monopoly provider fundamentally with a couple of also rands in the u.s enter spacex the change is dramatic it's rapid it transforms an industry it wakes people up the ministers in china said we can't compete on price even if we had western technology because they thought this was an impossible price point of entry well it went further they now launch huge constellations of satellites at one go it's a ride share missions and that's going to get better when these tugs take them to different orbits but this basically addresses the huge swath of smaller satellites that um uh there were 180 uh venture-backed startups to do small satellite launch vehicles meaning rockets to just launch small satellites and just that kind of falcon one used to do well now you can do several at a go at a much lower price and that's had a pretty dramatic impact on small satellite launch so there's not all satellites you're just the little guys right the little dove satellites little 3u cube sats and things of that sort the market share has just been growing um it's up about 90 still in 2023 as well get a sense of the difference when we invested in planet labs it was kind of compelling they they really showed that you could use commercial off-the-shelf cell phone components right batteries processors camera modules you name it throw it into a tiny little dove fly it closer to earth than the huge landsat and predecessor things and be roughly 10 000 times cheaper not 10x not 100x think how often the entrepreneur tells you i got a 10x improvement i got 100x you're like oh sure you do right how about a thousand how often do you see a thousand x in reality there's so many sub components in the aerospace sector through a thousand x it'll make your head spin a little just a stupid little radio to connect to the international space station to communicate as you're approaching with the dragon capsule with a 200 000 radio a piece of crap analog technology from the 70s still in use today you could recreate the whole thing for like 50 bucks in a digital uh radio which spacex did of course that's profound now a next area in space of course is once you have lower access kind of like fiber optics lowered the cost of access to the internet and you have this flourishing of innovations and apps similarly when you lower the cost of access to space you do all these huge constellations fly thousands of satellites where you might have had a handful before and this is pretty game-changing for communications for positions navigation and timings equivalent of gps and things of it that for figuring out where stuff is as well as uh imaging the earth not just with the visual bands that we have but all kinds of new satellites are going to be flying to specifically detect methane for example find all methane leaks on earth all the time like whoa that that thing is flaring was supposed to be flaring is actually just spewing methane into the air or this agricultural concern is completely out of control and be able to have feedback on the planet planetary health so there can be a lot going on with observing earth observing the climate observing everything communicating broadband direct the phones coming right so the next thing beyond these these these these dishes is that you're going to go directly to your handset for texting and email anywhere on earth right without carriers being involved directly meaning you can go direct you can bypass your government and doing so at price points that never been seen before that's going to bring the next three billion people online sooner than most market forecasters had seen so anyone with a global investment premise in let's say the internet might like to think about what does it really mean to have a billion people three billion people over the next three years being having access to broadband who don't today what online education courses might they take how might they want to be part of the global economy because they are decoupled from the global economy if they're not on the internet that's like a binary switch for like they're off doing their own thing and hunting sort of a subsistence farming kind of life to they're just as smart and capable and now they can learn with let's say the Khan Academy gpt education system that's personalized to them to be contributing to the global conversation so i think you're seeing more as a derivative effect more entrepreneurship than ever before on planet earth by like a huge amount just based on headcount summary of this what happened in space cheaper access is kind of a disruption and spacex is disruption created an opportunity for everyone right so from that seminal point right in 2009 when the falcon one started flying and then a bit later with the falcon uh falcon one than the falcon nine that's what opened up new space that's why there's been 300 venture funds that have invested in space in the last five years uh for the first time uh that wouldn't have been a good idea in 2004 right like it would have been timing would have been a bit off so there's that is a catalytic moment doing everything in a simulation right having a rapid iterative loop is in a sense the simple most important factor for a long-term sustainable advantage commoditized hardware like the peace dividends of the cell phone wars between all the different suppliers is the thing that all these new robots new physical things are using so even though i hate investing in hardware i end up investing in things that are vessels for software that are off the shelf hardware and it dematerializes value one last point about spacex before i leave it's important to have a dream a vision something that motivates the employees uh this is of course making humanity a multi-planetary species for spacex it's making all vehicles electric for for um for tesla that gets people excited to come to work each day it coordinates action as an organization scales so like a thousand employees maybe pulling in different directions if the goal is just maximize profitability well like this quarter this year this decade right those will trade off whereas a singular objective that everyone can understand coordinates action as you scale and it's really an incredible thing to witness most of these are sketches they're not reality the bottom left is reality that's headquarters at spacex every employee walks by this as they go into work each day reminding them of the prize mars mars terraformed and it is one of the things we look for too in these kinds of companies where there's a dream on the horizon let's say 50 years out that you chain back to the present and say therefore we need to invest heavily in reusable rockets because we got to get back from mars we got to shift our fuel source from kerosene to methane why because there's probably no kerosene on mars and it's easier to make methane simpler hydrocarbon so those mars-based imperatives led spacex to invest billions of dollars in things that none of their competitors cared about and but most importantly it led to a competitive advantage here and now it wasn't just like asteroid mining going underground for 20 years and popping out maybe with a product it was a better product and service today terrestrially with a dream simultaneously so we hold every company that almost impossible dual requirement big audacious change but iterating with customers in the near term and we ask ourselves what is that inevitable future i'll say one last thing about forecasting or you know future ventures being our name it is much easier to predict something looking out 500 years than five much easier not just because you won't be around to see if you're wrong or right right in forecasting that's the best trick right um it's that there you can ignore the transitions the you know ways in which big companies will try to regulate around you or unfair business practices and say in 500 years will we burn oil and gas in internal combustion engines of course not will we let humans drive cars around of course not every vehicle be autonomous every vehicle electronic electric how could it not be right how could something not be sustainable by definition if it's not sustainable it's not sustainable it's like it's technology right and lastly meat manufacturing i'll just throw in a completely different one we won't slaughter animals for food it's impossible you can't scale meat consumption the way uh humanity is wanting to scale it meaning doubling by the year 2050 with the amount of land on earth alone not to mention water use methane all the other stuff so meat is one interesting one i'll just show one visual there's lunch companies a couple here we invested in it's gonna be a taste of the future if you will i think we will shift dramatically as a people once we have alternatives that are as good right that are either cellular ag meaning growing literally the same stuff that you eat today or something that is a indistinguishable substitute like that mycelium-based steak on the right the thing that makes this interesting is this organism grows from zero to harvest in 18 hours so not only are you utilizing all that capital equipment on a daily cycle you're also running a new experiment every day on taste texture and what have you and so it is already cheaper than you know beef will soon be cheaper than chicken and hopefully it'll pave the way for a much more sustainable food system in the future last thing why now and this will be my last slide some of you might be wondering should i be investing into a recession and because it's not clear you know the the bureau of economic statistics is always lagging by about a year so we don't really know for anyone yet but we might be heading into when some people think we are and for the last 13 years i've been checking in every three or four years and because it keeps changing the dow jones industrial average companies who are they and when did they start and it turns out two-thirds of them and strangely throughout this entire time period two-thirds of them uh have been started in a recession and you might ask yourself why you know why are some of the best built to last ginormous companies started in recessions more often than not um why the super majority of them and there are a lot of things that go in their favor like you know as an investor you're getting real entrepreneurs not the arbitrage-seeking opportunists who are going to come and go when times are tough you know they really care about what they're doing if they're knowingly starting during a recession second is it's easier to build of course a team it's easier to uh grow frankly most importantly focusing on customers not investors so the opposite of this should be let's say some softbank fueled complete you know dizzy like go chase the next money get big quick kinds of schemes which frankly are really unhealthy for everyone involved not just the companies that take that capital but anyone in that sector right imagine you were operating a we work like business model responsibly right life is pretty tough when there's we work next to you right that's taking all the air out of the room so i like the idea that if you have a time period where companies are focusing on iterating the learning loop with customers not focusing on the next round of funding you build companies that are built to last and so that's what we look for frankly in any market environment up down or sideways

SPEAKER_266: it's not just oh let's focus on the next round it's like how are we going to iterate and

SPEAKER_273: learn from customers more quickly than anyone else wow incredible steve you had construction on um

David Friedberg: construction listed there as one of those categories and we have we need like seven or eight million more houses in the united states like right now and that seems to be a real sticking point uh and we're in a recession probably it feels like it although they're all unique have you found some exponential technological move moment in construction or in software in construction that could lead to that being an opportunity now or is that one where you think god we just might still be too early feels like one of the last castles to fall paradoxically that's a great question and

SPEAKER_262: construction as some of you may know is enormous percentage of global gdp and growing so as a percent kind of like health care you know in the us it's like why is it still growing labor productivity has gone down over 30 years in the uk and some other markets it's actually we're worse off in construction from a labor productivity point of view it's crazy so the quick answer is we don't know the answer we don't feel like hey we've got our spacex we found our tesla but we do know that's a sector that should change the indications of inefficiencies three percent of construction equipment is being used at any given time it's just sitting around unused 97 of the time it's insane um so we have invested in software for a schedule optimization that one of the things that can help as a point of entry is to say how can we do continuous rescheduling based on input changes like covet interruptions or availability of resources lead to labor or a particular piece of equipment and use that as a gateway into hopefully providing digital efficiencies to what is one of the least digitized industries of all both agriculture and construction have the least computerization of anything i have failed once already the very first google x spin out that there was the very first one was in construction re-engineering they realized it was you know one of the biggest economic opportunities on planet earth they thought we come in from an architecture point of view like like digitize those architects like push button generative design for buildings right makes sense building codes in every city are different it turns out we lost all our money there but it was a fun dream um so the the quick answer is we know the opportunity is out there it's a pregnant opportunity just right for the picking what we do in cases like this is meet with as many entrepreneurs as we can look for novelty like is there somebody who just convinces us they've got the answer and it's unlike anyone else's answer we have not gotten excited about back to mars

SPEAKER_284: discussion exactly so prefab not 3d printing not a lot of things where there's like scores of

SPEAKER_286: companies trying already but something different take one question so steve you mentioned at the

SPEAKER_287: end about the hardware commoditization right but at the beginning you also talked about the the benefits of these custom assets you know beyond gpus so with all these different companies doing their own custom assets for better llms how do you where how does the market go you do you think that that then gets commoditized and not stuck within these individual companies yeah that's

SPEAKER_262: a great question so uh that curve that morse log curve in a lot of cases did have hero experiments not necessarily the highest volume product right in in some of those but that has been part of the filter we've used so for example with mythic with the analog chip it's like a 40 cent chip so you could put a neural net in anything every security camera in theory every roomba cheaper than the plastic buttons on a roomba could be a voice interface that really understood you personalized voice that that worked you know consider it magic right that the voice interface is not like siri or alexa but overall the general answer to your question is there it takes some time so there's a lag before like every m2 chip from you know apple has a neural net you know engine inside so they will the large vendors that sell billions of units will incorporate and are already those custom basic components right every tesla has custom asics in the car and at the data center developed by tesla so um part of our goal as an investor is to try to democratize that a bit more right doing both software and hardware layers that will you know allow everyone to have that kind of capacity but you're right that there is a lag and that's why they invest a lot of money in it right like if there's an opportunity in any arms race

SPEAKER_290: to have a computational lead for even just a year or two it's worth them doing it thank you so much my

SPEAKER_292: thank you so much my friend that was awesome