David Friedberg: we're starting to see drones emerge again as a topic and part of the xycos and obviously this is all happening because in new jersey there have been a ton of drone sightings and there are tons

SPEAKER_01: of theories of it politicians are kind of getting in on this so now we have another layer to this weird information space we're in i've never seen anything like this in our lifetime but we have conspiracy theories distrust in the media yes citizen journalism plus a layer of politics

SPEAKER_05: and gamesmanship yeah how does and this seems like the ultimate raw shock test of what you believe

SPEAKER_06: about reality so effort let's just go down the rabbit hole here this week in startups is brought

Chamath Palihapitiya: to you by ramp the corporate card and spend management software designed to help you save time and money get 250 when you join ramp today at ramp.com twist dev squad most dev agencies only offer developers why because product management is hard get an entire product team for the cost of one u.s developer plus 10 off at devsquad.com twist and digital ocean whether you're just getting started with ai or seeing your project take off digital ocean is the cloud platform that lets you focus on what matters building killer apps right now get up to a hundred thousand dollars in free credits at do.co twist terms and conditions apply all right everybody welcome to this week in startups i'm

SPEAKER_09: jason calacanis i invest in a hundred startups a year i do two podcasts all in this week in startups next

David Friedberg: year three days a week for this week in startups monday wednesday friday thursday i tape all in it comes out friday so you get four podcasts per week that's the upper bounds here and with me my co-host

SPEAKER_09: on this week in startups alex wilhelm you know him from his tech crunch days and he is x.com alex how are you

SPEAKER_13: doing alex uh good i'm very excited about today's show uh we were talking before though about how

SPEAKER_15: you're a better skier than i am snowboarder and uh the fact that my children wake up too early but the nice thing is jason is that we don't have to sit here and vamp about bs for 30 minutes because even though it's late december or mid-december i suppose things are still busy which is just

SPEAKER_18: i don't know a blessing for us in the news business yeah i mean there's a lot to talk about a lot

David Friedberg: of information for startups and uh we'll be recording through the holidays i think we have two live shows during the holidays so we'll be coming to you live a little bit over the holiday just to keep you up to date on what's happening and maybe we'll do a twisty awards and um i think the drone story is where we should start alex because this has taken over people's imagination yes and drones were a major investment category a major startup category that kind of died down when dgi took over the space and won all the hardware that you know consumers buy but we're starting to see drones emerge again as a uh as a topic and part of the zycos and obviously this is all happening because in new jersey for the last month there have been a ton of drone sightings and there are tons of theories of it so let's get into

SPEAKER_13: it first of all this is not something that happened just this last weekend i think that people are now paying more attention to it in the last week but you're right the sightings in new jersey and the surrounding areas have been going on for about a month so this is actually a pretty long running

SPEAKER_15: story but there's been an increasing amount of noise so one thing that people were curious about is is this the government and jason i think as far as we can tell thus far the dod has said that this

SPEAKER_13: is not the government to their knowledge but it's also not a threat and then the fbi has said that a lot of these drone sightings are in fact just people misidentifying aircraft i'm going to show a clip here of what this kind of looks like in the world so jason this is a grainy cell phone footage of a drone yep allegedly yeah allegedly there's a couple of these clips out there none of which i found to be super compelling in terms of convincing me that this is anything hyper nefarious so i think between the

SPEAKER_15: two of us we can scratch out the ufo tag as in aliens yes i think we should start with what are the

David Friedberg: theories and you know i i love what grok has been doing grok 2.0 came out this and i've been using gemini 1.5 and 2.0 with deep research and i have to say i'm now realizing that about half my searches

SPEAKER_05: are no longer on chat gpt they've moved to grok or gemini which are both exceptional right now in fact i think there's parody but here is the grok conversation i just asked it what are the major

David Friedberg: theories of the drones over new jersey and you see uh what grok does is it goes and collects some news stories and it collects some posts aka or fka tweets really interesting and if you go through these uh misidentification is the number one so of course some number of these are obviously helicopters or planes etc second one is that there's some sort of military or government phenomenon going on commercial or research activities uh hobbyists and copycat so that's definitely a piece of this when ever there is a phenomenon like this of course everybody with the drone is like oh yeah i own a drone i'm gonna go fly my drone and look for other drones right and then drone to drone and then yeah exactly and then there's the conspiracy theories uh alien extraterrestrial and then there's

SPEAKER_37: adversaries like this is some other country and my favorite of course is project blue beam i never

SPEAKER_27: heard of project blue beam before this have you heard of this one i saw it uh via the grok summary

SPEAKER_37: but i i just read it and i was like okay so conspiracy theorists um have this belief that there is a

SPEAKER_39: project to destabilize uh this is a conspiracy theorist by somebody named serg mansang 1945 to 1996. he is

SPEAKER_32: mostly known for his promotion of the project blue beam conspiracy theory i'm reading off the wikipedia which posts a plot to facilitate totalitarian world government by destroying arabic religions by replacing

SPEAKER_05: them with a new age belief system of futuristic nasa technology involving fake alien invasion or fake extraterrestrial encounters so this is nuts right new world order crazy stuff but yes the idea being

SPEAKER_01: it's a psyops essentially and so i think we can take out its aliens or psyops it's obviously something's going on here but there's too many too much involvement here for it not to be an actual phenomenon i think we've we've gotten through that right definitely i think the number of drone sightings

SPEAKER_13: implies that someone is doing something with drones over the skies in new jersey no one knows what it is i remain though in the camp of there's going to be some very boring explanation for this but you're right i do think that there's been enough that i don't think that people doing copycat drone flying and people just hearing about it and then misidentifying airplanes star clusters or just

SPEAKER_44: satellites like starlings pretty low earth orbit you know so i i think there's something else here

SPEAKER_46: but i bet it's boring and these are very low um and so i think you know one interesting way to look at

David Friedberg: this is and there's a bunch of politicians coming in and one of the things about the information landscape right now is because of a lot of conspiracy theories becoming true which you know does happen one out of a hundred times right statistically something starts as a conspiracy theory and then you know we get evidence that oh hey it's true and then people fill in

SPEAKER_05: their minds very naturally we have inquisitive great big brains we think of every permutation this is how the human brain works it is a speculation fear-based machine why is our brains you know

SPEAKER_01: and i talked to a lot of different evolutionary biologists over the years they believe that our minds speculate and come up with theories for a number of reasons one is survival and one is to make tools and to evolve the species right so when we have these active imaginations we come up with something like i don't know scuba gear or we come up with the concept of a drone sure or you know we speculate that hey that person who's missing from the tribe was eaten by a crocodile and that big thing in the lake that pulled the you know deer into the water and ate it could probably also eat a human right so okay that's that's what's happening right now but what are politicians saying because i know we politicians are kind of getting in on this so now we have another layer to this weird information space we're in i've never seen anything like this in our lifetime but we have conspiracy theories distrust in the media citizen journalism plus a layer of politics and gamesmanship yeah and this

SPEAKER_06: seems like the ultimate raw shock test of what you believe about reality so effort let's just go down

SPEAKER_51: the rabbit hole you can absolutely apply any mental model to what's going on because if you want to

SPEAKER_15: think that there's one world government coming these could be cloud seeding drones or they could be you know surveilling people in the new york area over potential you know post-election discontent um the dod though has said that these drones are getting occasionally closer than they'd like to military installations that's their remit but they've also said that that happens somewhat frequently it's irresponsible they said didn't sound like a new shocking concern there hey everybody i want to

SPEAKER_56: tell you about an awesome corporate card and spend management software that's designed to help you save

SPEAKER_09: money basically it puts money back in your pocket it's called ramp and we use it here at launch my coo heidi our chief operating officer loves it because ramp gives you visibility into your company's software usage this is going to help you trim your subscription costs and it allows you to issue cards to every employee and then give them limits and restrictions so we do this sometimes we'll have the whole team go to an off-site we send everybody a ramp card everybody has a certain amount of money they can spend and they don't have to worry about using their personal cards or submitting an expense report or any of that drama no and ram customers save about five percent on their expenses every year because you can do things like dial up and dial down how much money can be charged to a card ramp software is so smart you no longer have to do manual expense reports either and they'll even play bad cop for your company chasing down missing documentation and requesting repayment ramp so easy to use and you can start making payments in less than 15 minutes so join ramp right now and they'll give you 250 right into your account ramp.com twist ramp.com twist it is the best way to manage expenses for your team it's elegant it's dead simple and it's going to save you money disclaimer cards issued by sutton bank members fdic terms and conditions apply so i just showed a couple tweets from uh senator

SPEAKER_15: chuck schumer very well known i believe he's um one of the most senior democrats and he said he's pushing for answers amidst these drone sightings implying that at least at his level jason which is high up in government he doesn't know what's going on uh i will say though that people are getting angry so the fbi and the dhs have held some briefings with people in government and according to uh u.s representative josh gottheimer he's a democrat from new jersey and on the house intelligence committee so should be very

SPEAKER_13: plugged in to all this stuff he says quote the bottom line is this the fbi and dhs are not providing enough information to the public and the public is concerned now right before we came on right

SPEAKER_61: before we started the show uh donald trump the future president said president-elect here we go

SPEAKER_64: the government knows what is happening they know where it came from and where it went and for some reason they don't want to comment something strange is going on for some reason they don't want to tell the people and they should because the people are really i mean they happen to be over bedminster they're very they're very close to bedminster i think maybe i won't spend the weekend in bedminster i've decided to cancel my trip i don't want to comment okay so i wanted to play the

SPEAKER_51: last bit there watching yes jason he got to mention his golf course how many times in there three times

SPEAKER_70: he sounds like me on the all-in pod mentioning founder university yes i mean very similar trump and i

SPEAKER_67: business guys talk their book and that's not just that's just how how they will he's been a self

SPEAKER_15: promoter for a long time yeah says in that clip that the government knows he says the military actually knows where they took off where they landed we're not sharing he doesn't think we should be so private about this then declined to answer the question about intelligence briefings talked about his golf course and then said i'm not going to comment on it classic trumpian both sides at the same time type thing but the fact that he was so clearly indicative that he thinks that the government does know the ex-president club is only so big jason and you and i are not part of it so i don't think we have

SPEAKER_13: the same uh view into what the government would and would not know in this case i was surprised by that clip because now he has to release lots about it come january when he's back in charge and he said you

David Friedberg: know he was going to release the jfk files he didn't do that you know so there is like you're right now we put a layer on top of this of trump says everything yes all permutations and gives himself complete optionality when dealing with you know making a decision he might uh go to japan and go skiing he might not but he loves japan you know it's it's like it never ends with him so here he's kind of like you know giving us both possibilities but the government there's something going on here i think everybody agrees with that yeah so then the mind wanders the one that i attach myself to the most just with a curious mind and i thought this was super interesting and led to me doing a little research online was the dirty bomb yes and that drones flying at low altitudes with certain sensors on them could sense radiation yes and then there's always been this fear of a rogue missing nuke ukraine russia who knows it could be a pakistani nuke you know the they they did a lot of research they sold their technology to supposedly iran and north korea so completely possible of rogue new could be loose in the united states for the last 50 years i mean that would make total sense to me that we have a nuclear bomb somewhere in russia somewhere in china that we implanted at some point and hid in a basement somewhere why couldn't somebody do that to us and have that as an option i know that sounds like crazy conspiracy theories but that doesn't seem too difficult to do especially with the size of tactical nukes all right so there was a video of somebody who claims to be a drone expert they have a linkedin page

SPEAKER_05: that looks like it has existed for a while so i have no reason to not believe them but this is my favorite theory why because it's the most interesting and that's what our minds do so here we go speculation like colombo this is an individual who works in the drone industry's assessment of

SPEAKER_91: what's happening yes this is john ferguson the ceo of saxon aerospace this is pulled from a tick

SPEAKER_94: tock video that he made but i want to give you the truth back in the 1980s ronald reagan had dismantled the uh nuclear program there were over 80 uh nuclear warheads that were in ukraine that came up missing i spoke to a gentleman a few months ago who was trying to raise an alarm to the highest levels of our government which they had their ears closed about this one particular nuclear warhead that he physically put his hands on he physically touched this warhead that was left over from ukraine and he knew that that thing was headed towards the united states okay okay so first of all everybody if

SPEAKER_13: you're thinking nuclear warheads don't get loose they do sometimes for example when a major government collapses for example the soviet union chasing and i've been hearing about lost or missing nuclear weapons visible material or even just the nuclear uh batteries that they put in those far north lighthouses in russia that they used to generate power over a long period of time so the chance that there is visible material or just a lot of radioactive material that could enter the us from let's say the eastern seaboard doesn't shock me and your point is that this could be what the drones are looking

David Friedberg: for seems like a great use of drones so i did a little research and he said this sounds like a very interesting use of drones right if you're in a helicopter or a plane those are expensive they're

SPEAKER_05: loud and sending 50 cessnas across new jersey you know at 3 000 feet or 2 000 feet whatever it is that's going to create a lot of noise a lot of ruckus and sure they can put on the bottom of them some sensors but i don't know if it's low enough to actually pick up the radiation i'm no expert on this but sending drones and having them do it at night which he said that's when in the part of the video again who knows this is all pure speculation but if they were looking for the signature of radiation is there a startup that does this i asked myself because there would be multiple reasons to look for radiation a dirty bomb would be high up there but absolutely leaks and other you know material you know i'm sure these the israelis have some technology here trying to monitor what iran is doing with stuff uh with their nuclear material pakistan north korea there's all kinds of reasons to look for this so

SPEAKER_32: uh we did see there was a startup when i was doing some some research that does this yeah yeah so the

SPEAKER_13: one that i found is a swiss company called arctis radiation detectors and they use uavs to detect radiation 15 million dollars in known capital raised per crunch base this is the company it exists in the world and they talk about in their detection system area they talk about using drones to do this

SPEAKER_46: sort of thing okay here we go arcus airborne fpg radiation detection drone this radiation detection

SPEAKER_05: drone can map an area of whatever in a single flight of 20 minutes the system is about 50 times more

SPEAKER_25: sensitive than typical drone-based detectors a central alarm station this is i think kind of like the the

SPEAKER_13: software for the different uh drones to actually go in um but they do a a number why are they doing it

SPEAKER_115: do they explain why they're doing this because they're doing gamma radiation commercial uh oh for

SPEAKER_46: ports for security reasons okay yeah so this has been the fear ports have radiation detectors because

David Friedberg: there's always been this i think this was a subject of 24 right like the tv show was there was a rogue nuke a loose nuke and so they said ports on a container where where it would come from so i guess the drones fly over containers or the containers my understanding is go through machines that check them this is a theory with some level of credibility now on top of all this is the next theory i love so anything else on this theory that is notable that we should if man if this if there is loose

SPEAKER_18: radioactive material that we're worried about and we've done this much drone discussion as a nation on tick tock and social media and government briefings and in congress i'll be disappointed that we weren't a little bit more open about it i just wanted to say that okay let's game theory then

SPEAKER_31: okay okay you suspect there's a one percent chance that this ukrainian former soviet union

SPEAKER_05: new is in new jersey at the port somewhere you tell people if you're the government one percent chance i i said to myself yeah one percent chance i said to myself on twitter and i got a bunch of people saying i was fear-mongering i saw you know twitter's for spitball and stuff i said you know if it was me and i saw all these drones and i thought there was a one percent or even a one in a thousand chance that it was actually a nuclear thing i would take a vacation with my family now of course i have the means to do that or whatever but if i was seeing these things over my house over and over again whether i was a middle class person or upper market i would get the heck

SPEAKER_130: out of dodge for a couple of weeks just go to a family member's house i would leave all right take

SPEAKER_131: a second and picture the ultimate all-star team for your startup okay you got that mental image maybe the avengers maybe even x-men wolverine cyclops pick your favorite superhero team and let's be realistic until you've raised your series a or your series b you might need some help building that dream team and finding top tier talent managing all the timelines you've got and maintaining quality it's a big lift for all founders i mean scouting for that elusive 10x developer that's going to eat all your time and that's where dev squad comes in think of them as like professor x you know they they know where to find those exceptional mutant developers who are 10x devs and dev squad offers a complete product team from latin america you're going to get two to six full stack developers a technical product manager and specialists in case you need them like product strategy or ui and ux design devops and of course quality assurance all for 75 percent less than a us-based team all for 75 percent less than a us-based team while being on your same time zone which is really important there's no long-term commitment it's just seamless collaboration so if you want a gsd if you want to get stuff done and you're ready to squad up head to devsquad.com twist for 10 off your first engagement that's devsquad.com twist and transform your startup with the all-star team it deserves that's just me i'm not paranoid but i think it would

SPEAKER_05: be sensible if they were coming over your if you had these going over your house and you knew what we

SPEAKER_32: knew what would you do with you and your and your kids would you leave and go to your in-laws or your

SPEAKER_13: parents no no we wouldn't we we'd talk about it and then we go oh my god can you imagine packing up for two months sorry two weeks for the three three month old and yeah if our kids were two and

SPEAKER_67: four versus zero and two i can see us going to but you would have a discussion it's not a crazy

SPEAKER_27: discussion is what i'm saying no because because my with my children a one percent chance of death

SPEAKER_13: is 10 million times more than i'm willing to stomach and i think that's the point precisely

David Friedberg: precisely it's the same thing with like i don't know taking a small plane i get offered all the

SPEAKER_05: time to go in little prop planes and bring the girls go fly around new york city take a helicopter here hard no thank you i'll take a pass i get invited to go heliskiing i just say you know what i've done the actuary tables i get to go scuba diving 100 feet nope motorcycles nope i just took all the diving no hard no on cave diving sounds fun no i'd love to cave dive i'd love to heliski hard no for me i got three daughters i don't want them to wake up one day and get the news that dad died heliskiing and then have them say or wonder in the back of their minds you know dad took all

SPEAKER_25: this crazy risk did you love us or not i know i'm sounding overly dramatic but isn't that what

SPEAKER_13: everybody would think or am i different i i think that people there there's an assumption going back to our thing about our brains and how we think about risk and so forth i think there's another element of oh what happened to me right that's happening somewhere else it's a theoretical risk now the reason why i think people are so upset is because now that these drones are over their houses it does make it very personal it brings it very much close to home literally so i i i think that you're not that crazy because if you were then we wouldn't be seeing so much interest in this story so many people talking about it but clearly they're at least upset and they're also probably cognizant that social media algorithms reward exciting material so this is probably also a hit on tick tock for a reason actually jason here's a fun question for you there's no tick tock imagine the world does this does this story get even half the attention as as it did yeah i mean without social media probably not

David Friedberg: i think in the era before social media it was much easier to control these kind of situations when

SPEAKER_05: something happened you know in a city whether you know god forbid a shooting a mass shooting or something it was easier to contain stuff right and to control the narrative but when everybody's got a broadcast capable satellite truck in their pocket and they can pop up any number of services in

SPEAKER_01: live stream and be citizen journalists you're going to get the good and the bad and you just have to be media savvy so the question then becomes you know for me every consumer people listening to this podcast and others you have to become really good at doing what we're doing here which is handicapping the situation thinking of probabilities thinking probabilistically and maybe stitching together some

SPEAKER_05: facts here's another fact do we have tools to know the drones that are flying everywhere does that exist are there satellite companies are there radar companies are there camera companies that monitor drones how do

SPEAKER_46: local police how do military bases how do uh airfields and airports how do they know if drones are

David Friedberg: coming in because even a recreational drone certainly a larger commercial drone that could take down an airliner

SPEAKER_137: and we've seen just this week some dipshits in boston kind of i mean are we shocked that it was around logan airport i mean it's kind of obvious what's going on here in boston folks so a bunch of guys

SPEAKER_05: in boston may have been probably celtic fans or patriot fans decided to take their commercial drones and fly near logan they got picked up in two seconds they got pinched immediately for being idiots and they do this during a drone scare and you know what drones in ukraine we have now videos of drones

David Friedberg: dropping grenades on russian soldiers and vice versa so this is obviously on everybody's mind these idiots go they shut down logan they get pinched but how do we know and it turns out drone detection

SPEAKER_05: is a category in and of itself we found a startup that does drone detection so uh actually we found

SPEAKER_13: well there's a there's a bunch of startups that are working on drones and i just want to give a shout out really quick jason to two that we've talked to on the show one is um frontal dynamics these were the students from the university of toronto who were working on uh anti-drone technology using sound waves if i recall correctly and uh we've also had of course skydio on skydio was sanctioned by china over providing uh taiwan with some drones for their fire department um great interview we recommend watching that we'll have a link to that in the show notes uh but elsewhere uh earlier i've chosen tweets from uh senator schumer and he has also advocated for a company called robin radar and uh they have a number of drone detecting systems and i have a clip from them jason right here here we go uh so here we go from robin robin radar systems announcing on the move capability

SPEAKER_164: for iris drone detection radar so that's the radar and now you can put them on your truck and drive them

SPEAKER_160: around mobile and tracks rogue drones carrying improvised explosive devices and unauthorized

SPEAKER_13: drones surveilling mobile forces so this is a company that i think is super cool um and if you are watching the video what they showed was uh jason a large cake container sized device on top of an suv that does mobile drone detection and now you can take this on the road with you i think especially in light of the violence we've seen in our nation's political landscape in the last 12 months let's say jason that we're going to see a lot more stuff like this and then finally one last one there's a company called apollo shield it's a yc company from 2016 and they're also doing um anti-drone stuff so there's a lot of startups that are building cheaper faster better drones and startups that are working on keeping us safe from drones so it's kind of like poison and cure so this is

David Friedberg: really interesting you know the ability to have essentially air traffic control for drones then

SPEAKER_05: there's the ability to take the drones out and there's multiple ways to take a drone out one is to screw with their electronics another is to hit them with another drone or a missile there's all kinds of different lasers and heating them up frying them there's tons of ways to take them down but first you have to track them and this to me is shocking that we don't have this technology in the field which then leads to the next theory oh interesting just to be clear jason you mean why

SPEAKER_13: don't we have a satellite pointed directly straight down over new jersey just counting each drone that's flying and giving us a live map of okay i see your point well i mean we have air

SPEAKER_05: traffic control why don't we have drone traffic control because if we know the next you know assassination attempt the next terrorist attack the next god forbid 9-11 is probably going to be

SPEAKER_01: drone warfare i hate to say it but that seems like the most obvious next thing for a lunatic a a terrorist you know an evil person an evil group to do if they wanted to terrorize people sure if you did what people are doing in ukraine and you started dropping grenades on people waiting for a bus in manhattan this would be super terrorizing i bought a dgi drone drone the summer i was in manhattan i've talked about it this thing's incredible and i was just flying it around manhattan and i was shocked that

SPEAKER_05: you were allowed to well there's a lot of money at state here whenever there's the countermeasures

David Friedberg: as you're pointing out to the measures that means there's an opportunity and there's a business opportunity so we talked about all these different startups and we have nicole on the pod uh later in the program talk about the opportunities and seeing a lot of duplicates we're going to see this is going to be a good beach for founders to serve we now know that drones can help in construction inspections all these kind of really great awesome use cases they're also entertaining and fun they're great for

SPEAKER_01: photography okay great but there's going to be a downside so now there's a whole industry of detecting and countermeasures and those are you know um we're going to see a lot of them but geopolitics now plays into it so we have conspiracy theories we have reality and then we have um all these

David Friedberg: startups playing but then there's going to be gamesmanship on top of this to get government

SPEAKER_09: funding okay everybody i'm about to give you a hundred thousand dollars in free credits on digital ocean listen to this quick ad read to find out how if you're running an ai startup you already know it's all about compute and that means training your models building ai agents and of course crunching massive data sets you need gpus and you need them to be fast and you need them online yes but you know managing those on the traditional cloud platforms it can be a nightmare and that's where digital ocean comes in it's the cloud platform built to help you scale faster without the headaches and right now they're offering discounted gpu rates at just one dollar and 90 cents per hour that's a 20 discount combine that with their ability to spin up gpu powered virtual machines in seconds and you will be training your models or crunching data immediately and when you're done you can shut them down just as fast so you're not wasting money you have to be frugal when you're running your startup and here's the kicker digital ocean lets you scale your compute power based on your exact needs from a single gpu setup to eight gpu configurations without any upfront hardware investment and with an intuitive ui robust documentation and on-demand support you can focus on building the next big thing not managing infrastructure which is so tedious here's a very simple call to action right now approval listeners can get up to a hundred thousand dollars in free credits and gpus at a special discounted rate of a dollar 90 per hour that's about a 20 discount on the rate in addition to all those free credits visit do.co twist to get started and view terms and

David Friedberg: conditions that's do.co twist so schumer came out and said he wants this technology okay there's also a bill so maybe we can talk a little bit about the bills that we've seen and what's going on there because there is a bill or an act that i think got signed into law that biden signed in where you cannot if you're a government employee buy a dgi drone dgi drones like the tick tock ban is a major issue that we should all be aware of because dgi drones are made in china and they could very easily be sending all the information they've got back and maybe there's like a zero a day exploit you know where all the drones could be controlled or taken over at a certain point same thing with self-driving technology do you want byd cars on the road in america do you want tick tock you know available in

SPEAKER_05: america do you want dgi drones the chinese could at some point just say okay have all the byds crash

SPEAKER_32: have all the dgi drones you know kill people and then let's use tick tock to create chaos you start thinking about these attack vectors could be a little scary on the geopolitical front uh a lot of people

SPEAKER_13: have been talking about the american security drone act of 2023 effectively that got fused into the ndaa or the national defense authorization act of 2024 what's going on here for folks who are not familiar with how the u.s congress spends money sometimes when there's a must pass bit of legislation like the ndaa other things get taped to it so that way they can make it through so this bill does mean that the federal agencies are prohibited from buying or using drones that are made in countries that are deemed to be threats to the united states this means china this means dji who has according to our notes 73 market share here in the us which is simply astounding number now jason for most folks out there using a drone to take a video of their dog at the beach really i don't i'm not that concerned about it but i can absolutely see how if you're a startup wanting to sell to the government and now they cannot purchase from the leading company in the space it opens up a ton of opportunity so i'm kind of hoping and i know we'll talk to nicole about copycats in a bit but like i'm kind of hoping there is a cambrian explosion of startups working on drones across the gamut because i think this is a place where we need to lead and so i think more people taking shots on goal versus fewer makes me feel

SPEAKER_32: safer there is a theory we left out there was one theory this could be a military exercise that seems

David Friedberg: plausible too so i'll put the military exercise pretty high up on this list and a military exercise with copycats could be like a really viable um explanation here and lest you think that our government is coordinated i need only bring up 9 11 where hijackers in florida were taking lessons and

SPEAKER_05: didn't care about learning how to land the planes they only cared about learning how to fly them and the fbi there knew about it yeah and it just kind of got lost you know across agencies etc we were tracking

SPEAKER_01: some of the hijackers long before 9 11. this kind of stuff happens all the time so it's completely

SPEAKER_13: possible wait somebody was about this we live in a a very particular nation with a particular set of government principles and rules one is shared power at the federal level and then distributed power at

SPEAKER_44: the state level this does create a less unified government it also works reasonably well as we've seen

SPEAKER_13: over the last couple hundred years i've been a little surprised at the criticism of our patchwork of authorities from people who are frankly coming into power soon because i kind of thought that it was a bit of a feature not a bug that in our government the dod is saying we're talking military bases and everyone's kind of watching their own area of policy or protection and if we wanted to have a more centralized approach to this we'd have to have a stronger federal government and jason i thought that was what we were moving away from so i'm just curious your thoughts on on the government agency response to this situation and if it's actually bad or working as intended what do they say like

SPEAKER_05: success has a million parents and uh failures an orphan if something successful happens we're gonna say oh my god the federal government you know stepped in and it was incredible what they did and then if it fails to be like oh my god the government failed so you know if you look at

SPEAKER_01: something like education and we're falling behind on education or health care you know you're gonna be like you know what screw the federal government move it back to the states the states are failing at something like why don't we have a federal mandate for i don't know abortion or why do we have a federal mandate for uh school vouchers you get the idea and so i think the best feature if i'm being

SPEAKER_05: totally honest is having two options and in management one of the theories is to keep switching

David Friedberg: things up so that you don't hit stasis and calcification doesn't happen so you go from

SPEAKER_05: building up all these middle managers at facebook and google and product managers etc and then you

David Friedberg: say you know what rip it all out flatten the structure let's have more chiefs uh more indians not a bunch of chiefs do i get canceled for saying that is that i just think it's i think it's gauche

SPEAKER_148: versus it's cancelable okay great uh what's the word you know doesn't exist more worker bees less

SPEAKER_46: whatever you know some you know structure and then you change the structure you go from you know uber

SPEAKER_05: having you know little fiefdoms where each city when they were growing were running their own city and running their own marketing had their own little fiefdoms and they were battling it out and then dara takes over and says you know what let's bring the decision making central so that we're not ruffling

SPEAKER_01: as many feathers and turning over as many tables in the bazaar and that was better for uber at later

SPEAKER_05: stages maybe it's better to let a bunch of country heads go crazy again and you know have their own

SPEAKER_01: fiefdom so that that's i think how you look at management theory is the best thing to do is to switch it up from time to time and crack any calcification that could be occurring there

SPEAKER_13: actually i really am glad you said that because i've been a little bit i kind of laugh at how management theories change inside silicon valley i think we're talking about this last week how google had so much money for a while that they were onboarding talent before they could use them to hoard them sure that was considered smart for a while then google got bloated and that was considered bad so then they got smaller that was considered good and then i'm sure in the future they'll hire too many people again and go through this cycle but i guess but to your point though about just needing to rip out what you were doing and replace with something else no matter where you are on the extreme of that cycle up or down it's okay because you're going to end up going back anyways so it's

SPEAKER_44: more of an oscillation versus a destination that actually makes sense to me all right next on the

SPEAKER_225: show we have a guest we love to have a guest on the show who's our guest today our guest is

SPEAKER_15: nicole wiskoff the founder and gp over at wiskoff adventures she also back in the day helped found

SPEAKER_13: one finance a neobank that walmart bought then she became a venture capitalist her first fund was five

SPEAKER_15: million dollars back in 2021 then she raised a fund two worth 20 and uh nicole according to pitch book

SPEAKER_13: at least your fund three worth 50 million dollars has closed yes it has and thank you so much for having me

SPEAKER_15: on the show yeah so we wanted to have nicole on jason not only because we love talking to investors about what they're seeing in the market especially after they've raised new funds but also because she had a very interesting comment all about what she's seeing in the startup market today and whenever

SPEAKER_187: someone manages to go viral with a bit of startup chatter i love to talk to them so nicole uh why don't you talk us through your tweet here and then we're going to ask you about it yeah of course so

SPEAKER_229: um i should carry out this with i do specifically pre-seed and seed investing so sticking a number of

SPEAKER_231: the same pitches from from that lens just wanted to call that out there the point i'm trying to make is that the number of pitches and maybe this is the case for you guys as well coming from startups even at the earliest stages are almost always the same so while this job can seem glamorous i find that i'm hearing the same fintech idea or the same supply chain idea where people are building a digital freight brokerage over and over the commentary was super interesting alex i am sure you saw some of it

SPEAKER_233: happy to speak to it and give a few hot takes but i will uh maybe let you guys lead with what you think

SPEAKER_13: could be interesting here nicole did a tweet yesterday uh about 3 p.m saying honestly shocking how

SPEAKER_15: many startup pitches are nearly exactly the same building in a market that's saturated similar product similar gtm etc the number of companies building something that doesn't exist or that is truly unique is far less than one percent and this begs my first question which is what was this like three years ago has has there been a a proliferation a doubling or a tripling of the number of startups you see pursuing the same idea at the same time nicole i would certainly say if you look at the data

SPEAKER_231: from 20 especially 2021 just about anything was getting funded um and so i'd actually say that we're you know it would have been much easier a few years ago i think the bar is obviously much higher and especially as things get to the series a and so folks are probably a lot more you know gun try to go do something super audacious no oh jason please no i was gonna say you know this phenomenon

SPEAKER_32: is very interesting i've seen it many years uh you know going into my second decade um i think i'm maybe a couple years ahead of you in uh this career i remember during mobile and social everybody had a check-in app like foursquare or goala and we were investors in goala got sold to facebook um wasn't a major outcome but everybody was going to do a photo sharing app and then there

David Friedberg: was the sort of everybody was going to do a food delivery app i think there's a kind of two phenomenon here one is when there's a new technology that's going to be applied say apps emerge gps emerge that becomes the why now so everybody's like whoa steve jobs just launched the iphone or there's an app store in the iphone or the watch is out and so everybody says well what can i do with that new platform there's a new why now there's gps there's stripe there's some new headset device and everybody rushes in and of course there's only a small number of things people do in the world they eat

SPEAKER_32: they sleep and they go to work they try to be productive they laugh you know you can fit into a certain number of buckets so new technology applied to existing problem sets in the world

David Friedberg: eating as but one example and then i think the second one is people see funding for a category like we saw in sas nicole and they're like oh wow sas companies there's a playbook here i can learn the playbook and i can speak sas to jason lemkin or david sacks or people who've put out a shingle saying we do sas and people who are looking for an idea say seems like sas is getting funded seems like there's a a lot of people hanging out on that beach surfing those waves and everybody runs to that beach whether

SPEAKER_05: it's the vr beach the ar beach the sas beach the on-demand beach the apps beach consumer beach so i

SPEAKER_229: think there could be two phenomenon happening here i think what's unfortunate is that in the short term it definitely makes that first round of capital easier to raise right like if you're someone had

SPEAKER_231: posted um an article i thought was well written that they called venture catering which is like every year vcs come out and they say here are the things that we want to see you know next year what we're looking for and then a ton of founders races check those boxes right and again in the short term because it's familiar there's a lot of companies hey i'm going to go after that thing that they've thought about for maybe two weeks and they go raise money and it's easier but then come the series a there's about a hundred of those to sort through they have very limited traction and metrics and then you see the fallout uh which is obviously makes our jobs as vcs start to sink you know you get a single markup or maybe none uh and makes it more difficult i just want to underscore the point

SPEAKER_18: nicole's making so one thing that i keep seeing over time is people building exclusive credit cards with

SPEAKER_13: like access to events and hotels and perks and such and here's another one from december 12 so four days ago it's called atlas card just raised 27 million and i'm sure in two more years there will

SPEAKER_12: be another one that i have to read a release from seems to be a never-ending thing yes why like i

SPEAKER_254: mean oh my god there's other problems in the world that i can't get a table at pick a restaurant like

SPEAKER_13: that is not the thing that's going to save the planet from climate change and war yeah and i want

SPEAKER_231: to call it too alex you know so a lot of founders responded and jason i don't know if you got to catch up on this but a lot of them said it's the vc's fault right like they should be looking for new unique things like how dare they blame us you know for this and i think what actually makes this even harder and i think about this a lot is as a pre-seed and seed manager like trying to lead rounds and maybe put companies on the map to get moving what then happens is i have to go around and think about well who will mark up this deal and continue to support these companies right like well i have a new 50 million dollar fund is that enough to really back up the truck and continue to support these companies um hopefully but right there's not a lot of metrics in the first two years that would you know say hey lps can i put 20 million into this company and do it by myself with that said is when i started asking around people say well i remember i made an investment more recently called uh in a company called frontlands repeat founder from the one of the one finance company that sold to walmart and they're building think of the aven card but for mineral rights so no one's ever done this for property-based rights everyone wants to buy them pe is huge in the space or they're trying to buy these rights from people but no one's actually letting you lend against them and every multi-stage fund said to me um love it but like with the aven card they didn't actually to go get the credit facility they didn't have to come up with a net new financial offering right it's the heloc it's a home equity line of credit and they're just attaching a card to basically spend against it with this property-based you know line this is a net new product that's going to be tough

SPEAKER_264: to sell a partnership like boo-boo right and so it makes sense that this is new so we can't do it

SPEAKER_228: i thought that's what i know and that's exactly right so i think what's tough is and one thankfully we have these early stage funds that exist and that continue to support these until they kind of

SPEAKER_231: create or get to this escape velocity where it's a series b and that same partner saying like oh the market exists it's there thank goodness you know let's invest but again it makes it hard to go against the grain as an early stage fund and say let's take a even bigger risk here by doing something that people probably won't support for two to four years jason does that impact how you think

SPEAKER_270: and how you invest well yeah i am a bit of a lunatic and probably an outlier and i think you're a

David Friedberg: function of the bets that you've previously won so if you were to tell me the top three investments you would have would be a taxi company a meditation app and a stock trading app where you don't charge

SPEAKER_32: people to trade those were obviously uber com and robin hood you know three of our major outliers those were non-consensus bets and those were things people did not want to bet on at the time 19 of 21 people i introduced uber to did not invest first round cyan banister and myself did the investment i had introduced first round and cyan to it back in the day and so nicole is pointing out something called pull through and so for seed funds like ours uh and we have same size seed fund and we we do essentially the same thing although we have i think you know an accelerator and a pre-accelerator so we have more programs i think and nicole is you're doing individual deals i would expect maybe only

SPEAKER_05: one in three to half of our companies to pull through to the next round now that would be low by other

SPEAKER_01: people's standards where if you're a series a firm you expect 80 of your companies to get a series b if you're a seed fund i don't know what nicole expects but i would guess two out of three to get to series a would be the hope i'm actually hoping the opposite now why would i be hoping that two out of

SPEAKER_05: three don't make it to the next round well that means we're being more audacious we're taking more risk so just based on my career i would rather swing for the fences and hit another uber robin hood

SPEAKER_01: com and work the the power law then you know play it safe and do 10 more sas companies that doesn't mean i we don't do sas or whatever but portfolio management is part of the game here you know you you do have to show in fund two that you can get half your companies to series a or whatever it is

David Friedberg: in order to raise fund three and that's because alex if you're a new vc you know my it's only my first fund is really hitting the 10 year mark now when you can actually look at returns and so how do lps judge how nicole's doing or how i'm doing or how pair of these do it pair of vc is doing if they don't have outcomes where companies are going public or you know and you're distributing they look at pull

SPEAKER_278: through and so that does drive a little bit of this where everybody is circling the wagons and marking each up each other up but at the end of the day your career will ultimately be defined by your

SPEAKER_13: power law outliers yeah nicole i'm curious if there's an ai element to the level of startups that are doing the same thing because we've talked a lot about over the years how it's easier to start a company like you don't buy servers anymore you have the cloud well now you can have maybe fewer developers because of ai blah blah blah so does that mean that we're just seeing more total companies

SPEAKER_285: appear and that's making them seem to be more similar to one another than we might have seen

SPEAKER_228: five years ago i i feel like i'm seeing well i mean it's obviously a smidge quieter but precede seed

SPEAKER_231: really hasn't if you look at any of the card or angel list data it's been super active i think a is where the friction is where like there's a massive fall off of of companies being promoted with that i'd say i'm seeing a similar number of deals it's just a lot of the same applications so and and i i will say too and i i guess the founder's credit but a lot of really talented people that i meet are just now considering leaving you know their company and they don't have an idea and so they're constantly doing this tour of duty which is talking to a lot of people and trying to come up with an idea and i think they do go to these vc spreadsheets and say what are people looking for and oh that's interesting like let's do that you know and cherry pick something which also definitely is happening now i mean there are a million market maps coming out of every fund there's all these flashy ai fund fund raises and so it's also a function of i think people looking for

SPEAKER_292: ideas and those are just readily available yeah i call those alex the beach to surf at so what beaches

David Friedberg: have good waves right now ai defense tech obviously what beaches do people maybe not believe in as much consumer vr uh sas people don't believe in anymore entrepreneurs rightfully will look for where the action is and the action sometimes is based on just following you know uber and doordash and lyft and say oh there's a lot of energy over on on demand in airbnb so they do airbnb of everything the uber for

SPEAKER_09: x was an uber for x right i mean how many of those pitches do we see which ones still exist which ubers

David Friedberg: for x still exists right now and then even with the copycats you know and you look at say food delivery

SPEAKER_278: man all of the food delivery companies are consolidated down to how many players now two or three yeah uber

David Friedberg: eats doordash what else is there now toast i guess arguably is a public company that was private so anyway things consolidate down as part of the race and if you were an investor in lyft in the seed round or the series a or series b even you're pretty happy even with you know the fact that lyft you know

SPEAKER_01: maybe isn't uber but it still became worth 10 billion or 20 billion at whatever point in time you still did phenomenal so sometimes even hitting the number two or the number three can be a massive grand slam for a fund people forget that yeah basic math you know especially for seed funds if you're a seed fund and you're in postmates or a series a investor and it got bought by uber you for a couple of billion bucks you feel pretty good about it right so uh nicole i know we

SPEAKER_13: have to let you go in a second but i do want to ask we've seen a lot of um people that went out and founded new venture capital funds in the last couple years struggle to raise a fund too even clearly with your fund three now raise that's not you so i'm just kind of curious if you could tell us about the state of the uh the venture capital fundraising side of this how hard was it to raise your third

SPEAKER_304: that's what i'm asking very politely institutions or individuals where did you have success so look

SPEAKER_305: i went out expecting this would take a long time right i uh my legal team is wilson cincini i think

SPEAKER_231: they're in the top three like uh law firms that represent funds um and they openly told me nicole you should update your lpa even the really big mega funds are doing this which is your limited partnership agreement as a vc you need one uh to you know raise money from lps and they it traditionally said you have 12 months from the first close of the fund um to to close the rest of the fund and they said you should update that to 18. so i thought well i better target super early here because it's going to be a bit i don't want to add a capital so i went to market and within five months i had all

SPEAKER_229: of it raised i'd say at three months i had all commitments and we had a few months um of of legal back and forth i even i scratched my head and wonder you know like why thank you oh yeah

SPEAKER_305: you know how was i fortunate um the 20 million dollar fund took seven i thought that felt like

SPEAKER_231: three years um just because you meet so many lps so i pitched i put some data on this on x but i think i pitched just over 120 firms i do i will say something that i think helped a lot which was one i mean i think you have to i've also tweeted about this but i think you have to there's sort of this game of having half nots like you have to be in network right like i think lps really want to know that you've got like you know notable at least initial lps and notable deals that you've done jason mentioned this earlier but when you don't have much of a track record they want to see that like blue chip funds have marked up your deals so how are those pressing that's an early signal and so i was fortunate to have a lot of that i also think a big theme right now for folks is that they want super early stage true venture exposure um not the series a plus exposure that all the multi-stage funds have gotten bloated and there's tons of products for that now they want people what's that why uh i think they want real alpha you know first ones i think returns yeah yes yes and returns right there's if you are and and definitely if you keep it disciplined even seed fund size for another time but i don't understand these 150 million dollar plus precedency dedicated funds from a returns perspective and so i think that if you have a super disciplined fund size so let's say it's 50 million um if you're going after precedency again you have great you have an opportunity to like you know have 100 extras in there and jason's had a few of those and you um are getting high ownership that seems to be like what everyone is looking for and i checked those boxes so the last thing i'll say on this in terms of strategy for raising the fund is i went out and i took 78 first meetings in about three weeks and i hammered it i did like they were all hour-long calls i got all of the vcs in the pipeline and the data room at the same time and then i you know i wouldn't say it was necessarily bluffing but i didn't know if it'd work out i kept saying we're gonna have a first close in june and a final close by the end of august and i was holding my breath and it worked out but i think if you create a sense of urgency and you tell people like this it's i think it's a matter of

SPEAKER_305: expressing this will get done it's just a question of when and not if which is the same for founders

SPEAKER_32: right like if they have a definitive goal and they're saying hey the train's leaving the station i'll talk to you for the next fund you know uh did you start before or after silicon valley bank

SPEAKER_229: uh went under and then had to reboot um after oh yeah so this was uh it was this year so we i started raising in what was it to hear march of this year and then closed it in august so it was really

David Friedberg: tight i started right at silicon valley bank imploded literally one year was that 2022 or 2023 when that

SPEAKER_321: happened i think i was just thinking the same thing i was like was that 20 god it's like such

SPEAKER_06: a march 10th 2023 so yeah yeah i started right before that and oh my lord for six months i just

David Friedberg: had to pause everything in the middle of it i was like you know what this makes no sense i had already gotten in you know 10 or 20 million from my accredited investors and some early lps and then everything blew up every single person thought it was the end of days and they just said we'd love to

SPEAKER_05: meet with you don't want to waste your time we're not doing any funds this year this is 2020 we're not doing any funds in 2023 and we're pairing our names we're going to lower the number of elk number of funds

SPEAKER_01: that we already have so we're going to cut names and it was like you're going to cut names of people you just did their first or second fund and they're like yeah because we don't have money because there's no dpi and the world's ended now all we need is a couple more service nows and reddits and these kind of things and maybe the end of the wrath of lena khan will change m a and then all of a sudden when singles and doubles happen that's when people get frisky when you return you know 50 of your fund early you know year four or five they get half their money back or they get you know a full turn one x people are like oh yeah yeah i'd love to support your next fund but if you haven't returned man anybody who had that fund in 2020 to 2020 2019 to 2022 that vintage is going to be really hard

SPEAKER_67: pressed to raise again and so it's a great point jason yeah so uh nicole's first fund 2021 her second fund 2022 so um i know we have those were 10 20 million dollar funds you did yes yeah five and

SPEAKER_229: 21 20 and 22 and then i skipped svv i guess i just got really lucky and then i raised in 24.

David Friedberg: yeah i mean timing is everything if you went out in peak zerp you raised you know three times as much in half the time if you raised during you raised half your target and then if you raised

SPEAKER_274: after you raised your target so it's just like for founders it's really difficult for uh vcs right now and uh congratulations on doing that well thank you keep it up yeah thanks to gold we appreciate

SPEAKER_91: it and uh next time you uh land a hundred bagger come back on the show and tell us all about it

SPEAKER_332: yeah love you love the show you guys thank you cheers all right bye she's awesome although i gotta

SPEAKER_13: say jason i i was i was going in there for the what is your irr from your 2022 fund oh yeah you could

SPEAKER_37: have asked her that she probably would have said um yeah but most most you know

SPEAKER_01: you here's the easy thing you say i'm in the j curve yeah so most people would just say i'm in the j curve like for our fund three i'm in the j curve right we just deployed it so who knows and then for fun one and two on paper 4.9 and i think 4x on paper and then in terms of returns ballpark i

SPEAKER_05: don't have the exact number in front of me it's like 1.2 and 0.5 or 0.6 return for the first two funds which is great and now my job is to close the gap between the paper gain and the actual distributed and what's crazy is sometimes you have a startup that's you know 20 of your paper gains and it goes out of business you know like oh my lord now you know i was 5x on paper on 4x and then you have some company you thought was you know just dead or was you know uh in zombie state and the founder's like yeah i don't know if i and then all of a sudden they pull a rabbit out of the hat and they raise

SPEAKER_01: a series a and you're like oh my god that's incredible so these markups you know paper markups

SPEAKER_278: are just that and it really comes down to can you get any kind of a dpi can you distribute uh and so

David Friedberg: great job nicole and uh it's hard and i like keeping the fund size smaller that i think was the other point in her in the discussion alex is you know she's like why would you have 150 million

SPEAKER_278: dollar seed fund yes you know if you do a 50 million you can get a hundred names in there you know or you know 150 names or in our case maybe like 250 because we have this found university

David Friedberg: very unique product in the market we give 25k checks for the first check that a company even gets to incorporate you know if you have something unique like that the chances of hitting an outlier go way up and then if you do hit the power law in a smaller fund the ability to have a multiple on that goes up so the smaller the fund the greater the chance of having a four five six seven eight nine ten twenty x fund whereas if you've got a big number like 500 million dollar fund or a billion dollar fund yeah you're going for two times three times the amount of money which means it's probably you know going to be very similar to the stock market um in the same period of time which is why

SPEAKER_05: venture is such a troubled space right now is can you beat the market is the real question and the market gives you liquidity so yeah vcs are having a really hard time because they have to beat the

SPEAKER_87: returns of a vibrant stock market yeah the stock market's been on fire lately but just to your point

SPEAKER_13: about um larger funds larger returns this uh jason limkin tweet was actually something that i saw earlier today and he does some math in this and he points out that vcs need about two billion dollars in exits for about each 50 million they raise and he has his own math for that i'm sure you could tweak the numbers around but it does go to show how much liquidity you have to generate to make a venture

SPEAKER_78: capital fund make sense financially and it's it's the envelope bath would be you know you get diluted

SPEAKER_278: 50 percent if you're a seed investor so if you owned five percent of a company for 500k let's say you invested 500k of five million a ten million dollar valuation now you're down to two and a half percent ownership two and a half percent ownership at a two billion dollar valuation is 50 million so for every 50 million you need to have one of those become worth two billion how many companies do you invest in your life that become worth two billion and that you have the ability to exit because both things have to happen it can't just be marked up on paper you have to have the opportunity to exit you know those are

SPEAKER_01: few and far between which is why when you get an opportunity to sell in secondary you know at 500 a billion two billion as a seed fund you really are encouraged to consider that deeply and maybe sell 10 20 30 of your position to lock in some dpi and keep your fund in business okay great job there with a

SPEAKER_05: great guest of the moment uh we like our main characters all right everybody we'll see you next time bye bye bye