SPEAKER_00: all right everybody welcome back to the number one podcast in the world the fantastic four the original oh the cast is back the cast is brothers in arms brothers in arms here we go good boys we got a big news week david sacks is back and he's in the great state of texas how's it been sacks SPEAKER_05: has texas been for you so far it's been great although i just got back from dc i got like three hours sleep last night so but we had a lot of news this past week yes and we'll be talking SPEAKER_09: about pcast and your role in the and your role going forward in the trump administration big SPEAKER_10: news that we'll be talking about today also relates to you oh sultan of science david freeberg with your background from the iconic film for those not watching looks like the iconic thelma and louise i wonder if that has something to do with the budget of california which you've been outspoken about recently great rent which i retweeted thank you boys i retweeted it too if only if only you could SPEAKER_05: be allowed the time and space to do those kinds of rants on this pod yeah thank you very much SPEAKER_22: here he is he's going again he's going there it is dr doom dr doom your mayor your new governor would you SPEAKER_23: consider it friedberg after a hollow running for governor there is no after a hollow oh please do SPEAKER_27: it oh please do it wow that'd be so great i'm tempted to buy a hollow for like five or six billion SPEAKER_29: so he just it's a dirty game paul it's california politics is dirty man i don't even know what it SPEAKER_30: does i'll just have somebody else deal with it could you imagine the oppo research the amount of SPEAKER_32: on friedberg no no no no we get him elected he would do an incredible job he would save the fourth SPEAKER_34: largest economy in the world it would be incredible it'd be amazing i would love the here's the SPEAKER_36: opo resource act david freeberg went to a rave in 1999 and stayed up until 10 a.m we have witnesses SPEAKER_37: once he he got tilted at the poker game stole a bunch of pistachios and lactate and ran home he did SPEAKER_09: anthropic on a generational run and open ai crashing out a bit boys let's chop it up here just looking at anthropic pretty major heater this year january they launched co-work for business users you know what that does cron jobs you can connect to your gmail your notion whatever it is and then opus 4.6 which consensus wise everybody thought this is a major step function jensen michael dell everybody's called it out jensen actually called it back in november and inflection point and the first agentic model and uh opus 4.6 has basically dell said hit a threshold that we haven't seen before in terms of real productivity in teams february they dropped a bunch of clog code plugins that caused SPEAKER_56: the sas apocalypse not the sax apocalypse the sas software as a service it was a sax apocalypse too SPEAKER_59: yeah there was a little bit of that back and forth as well you know i mean as a sas investor it was SPEAKER_60: us yes it was a bit of it you you you were the tip of the spear there we'll get into it my exit comps SPEAKER_63: were affected that's all yes it seems like you may have divested at exactly the right time SPEAKER_00: all right six billion dollars in annual run rate was added in february alone brad referenced a couple of weeks ago here on the pod earlier this week they announced computer use a new agentic system for enterprise grade kind of open claw functionality now you can use the clawed app from your phone to control your desktop computer really slick feature here's the calendar release over the past two months for the team at anthropic dario come on the pod anytime uh sax you've had a couple of flare-ups uh and obviously the administration and the department of war had their kerfuffle but just you know looking SPEAKER_67: at it objectively what's your take on the the surging anthropic generational run as i've described it SPEAKER_05: here well i've never been a critic of anthropics products i've always been an admirer of their products i think last year i gave them credit for mcp i agree that they seem to be performing very well now the company made a big bet on coding as the kind of big breakout use case whether that was done for business reasons or ideological reasons i'm not sure anthropic is sort of the most agi pilled of all the frontier labs and i think they made this bet on coding as their way to get to recursive self improvement as it turns out it was a very good business move as well because code is the gateway into enterprise and enterprise it budgets and so they're able to grow revenue pretty quickly as a result of getting into enterprise also coding seems to be the basis for these other product extensions so like you said they went from cloud code to cloud co-work the idea being that well if you can generate code you can also generate powerpoints or spreadsheets and you do that by generating the code to create that output so that was the first extension now they are extending into agents this computer use product is kind of like an open claw knockoff so it looks like the generational run for mac mini is just about over look i think they're firing on all cylinders my issues with them in the past were related to what i have called the regulatory capture strategy they do want a permissioning regime in washington for chips and models meaning you have to go to washington to get permission to release new models or to sell gpus anywhere in the world i think that's excessively heavy-handed their motives for doing that may be pure it may not be regulatory capture it may be ideologically motivated regardless i do think it is a form of regulatory capture because it plays into the hands of the big companies and creates moats that new entrants will not be able to overcome so i have let's say philosophical objection to that part of it but again i'm not a detractor of their products by any means with respect to what happened between them and the pentagon i'm not involved in that i've stayed out of military procurement in general i don't get involved in what are called party matters i just focus on policy matters which affect the whole space i saw emil michael making this point a couple weeks ago on our podcast that if you as a company don't want your products to be used in war don't sell to the department of war it's in the name but if you do if if you do decide to sell to the department of war you should expect it to be used for all lawful uses so i think that was a very pragmatic observation again i just have to underscore this again i'm not involved in that dispute it's the base of a lawsuit right now and i don't want someone trying to draw lines between SPEAKER_09: dots that aren't there so yeah yeah fairness i'm saying out of that one objectively they've been treated the same as any other large language model even though they're not fans of the administration they're not donators to the administration they have specifically been critical of the administration as a company perhaps cynically freeberg as a strategy to get uh you know it's one of the conspiracy theories here in silicon valley is dario is taking the position of being anti this administration anti president trump in order to get all the phds you know there's like three or four thousand of these highly sought after phds and it's a way to have them you know vote with their presence to come SPEAKER_76: work in anthropic your thoughts on that and then just generally their general actually believes it SPEAKER_79: and i think they've actually created and fostered a culture of that since the beginning and i think that they're representing it as a branding exercise at this point but i don't think it's made up i think it's directly representation of the people that work there and what they believe yeah and it's a SPEAKER_08: strategic advantage because probably of those 3 000 phds 90 of them are left-leaning uh and wouldn't want SPEAKER_78: to work necessarily look i mean like like most things we see in the world today and economics SPEAKER_79: today and markets today and business today everything seems to be politicized and you have a left and a right version of everything you have a left and a right version of media you have a left and a right version of what food to buy you have a left and a right version of what ai tool to use so you know this effectively may just be the natural manifestation in the ai market of what's going on elsewhere in society as we all kind of fracture and hustle over to our side uh chamath before i go SPEAKER_09: to open ai and their recent moves any thoughts on anthropic and dario's positioning of the company SPEAKER_27: look i think both are incredible businesses we're in the part of the cycle where SPEAKER_90: we're trying to create drama where i don't think drama exists because they're still fundamentally in very different go-to-market motions now they may converge and compete over time but i think it's important to separate where each of them are good from an enterprise lens which is where i see most of the action particularly through 80 90 it's all anthropic all the time and i agree with sax my philosophical issues with the management aside around their ideology and sometimes how they use some of the capital Chamath Palihapitiya: for things other than tech and r d i have issues with those things but in terms of the quality of that technical team and what they create it's head and shoulders above anything else it allows us to SPEAKER_90: build a vibrant business now do i have issues with how much it costs yes do i have issues with how fast we're consuming tokens also yes but i think those will get sorted out and those are really tactical Chamath Palihapitiya: issues so the reason why i think we're all breathlessly trying to pit open ai versus anthropic is because we want some drama but the reality is these are very different businesses and nick found this tweet which i thought was really interesting and because even at the absolute highest level these things are sort of presented in an apples to oranges way and there's like these very basic issues of rev rec that are fundamentally different and you may say well who cares about revenue recognition while the people that are trying to write the headlines that say one is overtaking the other and this or that sort of miss the fact that they're in completely different businesses which has guided how they even think about growth and so if you normalize these two businesses what you would see is open ai is still the overwhelming revenue generator in this space and that over time anthropic is catching up and so this is this little diagram that tries to explain this open ai is three quarters consumer subscriptions and a quarter api and propic is almost the exact opposite open ai is used by consumers overwhelmingly and propic is used either directly or through things like github and cursor open ai as a result has a very conservative way of recognizing revenue anthropics they sort of recognize gross tonnage as their revenue and so when you start to hear these things about like oh this SPEAKER_32: thing is at 20 billion and open ai is at n billion they're two totally different conversations and i Chamath Palihapitiya: think right now it's more about the press cycle of trying to create clicks than it actually is about the underlying quality of each business both are incredible businesses as this demonstrates and by the time it goes public both of these two businesses will have a very clean and i suspect normalized way of telling a story so that you can actually compare but what i would tell people right now is everybody's running SPEAKER_90: with numbers to try to create a narrative that i don't think makes sense or applies to either yeah and SPEAKER_09: there's been a lot of strategy change open ai some people are saying is crashing out in panic mode obviously they own the consumer with chat gpt they are the verb like you know taking an uber or googling something people consumers always just say hey did you check chat gpt but obviously other large language models are catching up here's by the way we say something to that jason because like sure SPEAKER_90: you mentor tons of startups sacks has done it freebrook has done it i do it Chamath Palihapitiya: what is the one thing we tell folks focus focus focus focus 100 do one maybe one and a half things SPEAKER_32: but do it incredibly incredibly well and everything else you start to bleed and smear what was that brad garlinghouse term peanut butter peanut butter yeah you smear the peanut butter too far out and so SPEAKER_90: this is a good moment by the way if either of these two companies are in the smearing phase to recalibrate and reset because yeah you just can't do everything speaking of smears i couldn't SPEAKER_05: help but notice that emil michael was smeared by an article was it in lever or something like that SPEAKER_13: accusing him of of having a conflict in the anthropic SPEAKER_25: disperse conflict did you guys see that i didn't yes i saw the art there's an article that said that he SPEAKER_79: was an investor in perplexity and therefore he's conflicted in his negotiation with anthropic that's SPEAKER_113: what the article said pretty much perplexity is llm agnostic that's a stupid claim right well it's SPEAKER_05: obviously written by people who don't understand anything about ai really perplexity is a wrapper you're like you're saying it uses multiple ai models and i don't think they sell to the pentagon they're not a competitor to anthropic and moreover as i understand it emil's ownership of shares in that company was blessed by the office of government ethics nonetheless i think the timing of this is very suspicious and it reminds me of what happened to me when i started opposing anthropic and all of a sudden there was that hit piece in the new york times accusing me of having conflicts and i'll just say that anthropic may pose as this company that's on the side of the angels but they've hired a number of very seasoned brass knuckle political operatives in washington and you know members of the biden administration laura loomer actually just had a piece today on one of them i'm not gonna rehash that but the bottom line is this is i think frankly a political operation that's willing to get down and dirty and they're not always on the side of the angels i think they can be quite ruthless sacks SPEAKER_09: remember i told you you get one by dimension a month in 2026 so you just used it up so i don't want any more biden biden biden he's retired that was not a biden mention no but the truth is these dips who ever wrote the story the actual best feature or amongst the best features of perplexity which is actually got a really great co-work competitor called computer i've been playing with i'm not a shareholder to be clear there's no book being pumped here the model council is like the greatest feature yeah that they have and what is really brilliant about it is you ask it a question SPEAKER_00: sax it will go to all three different major models you could pick which ones including open source then it tells you where they differ and it tries to figure out why they differ this is like one of the great features of the product i think perplexity is like could be a really great company as well even without a language model but let's talk a little bit more about open ai here and their market share because i think you're correct chamath but they are getting off their game here's what's going on quick look at the consumer market and obviously they started with a hundred percent market share right David Friedberg: they created the category in 2023 dropped down to 85 market share 2024 75 market share 2025 but by how much SPEAKER_125: has the market grown precisely so uh the market is still growing so in terms of number of searches SPEAKER_09: and queries they're obviously growing tremendously but they have major major competitors and the market share is going down i had my team over at this week in ai do a more thoughtful analysis of where this is going and if you take a look at this um there's three players and i'd like to get your guys's take on this who really haven't shown up yet apple uh meta and obviously windows all three of those underrepresented if you give them credit for just getting you know a half point of market share here and starting to intercept which i think those three players were here will be here they're going to be well under 50 market share and i think chat gpt is going to have some big challenges there on the consumer side while they're doing this stuff in consumer uh they uh are cutting back on all their side projects so uh you probably heard about the sora video app that's been shut down this is kind of major news because disney was going to put a billion dollars into opening as part of it and they had done a licensing deal and they were going to integrate sora this you know short video product into disney plus all of that's now been canceled the billion is not going in the billions not going in the licensing deal all of that and then in addition there's supposedly at open ai a newfound focus on chasing anthropic down the enterprise path so getting off their game getting a little discombobulated perhaps or maybe getting focused on what matters which is enterprise apparently in terms of revenue opening i also offered private equity investors a guaranteed minimum return of 17.5 percent as part of a joint venture that would help pe firms deploy ai and ease the high up front cost of that so lots of questions here chamov i don't know if you've tracked this pe model but obviously a lot of people are doing roll-ups in services accounting legal josh kushner's got a big effort here a bunch of private equity firms trying to essentially i guess and run the transition process and arguably what you're doing with the SPEAKER_132: software factory at 80 90. so your thoughts on open ai and this pivot and this private equity i think it SPEAKER_90: makes a lot of sense for open ai to focus on a few things and do them exceptionally well i disagree slightly with your first part which is i think that people like to make new decisions about new experiences and i think that open ai has incredible consumer mind share i just see like how my kids use it they started there and it's very hard to get them to switch even when i say hey have you tried gemini they use gemini and to your point the reason is because they stumble into it more yeah but if you give them a cold navigation experience they rely on chat gpt and it's the same by the way on the SPEAKER_95: other side in the enterprise if you give us a cold problem my default reaction would be to use Chamath Palihapitiya: anthropic now i actually think that that's quite healthy because you're going to segregate the market and i think look if you go into the wayback machine when we first started talking about this thing this is sort of how we all postulated this would work where even if open ai just won the consumer business it is a multi-trillion dollar company with enormous scale and value and i think that that's okay so i think that what they probably need to do is say where are we the strongest where is there the most obvious traction can traction in another market like an enterprise bleed into consumer usage if it's true then you have to win the enterprise i think winning the enterprise though is a very different game than winning consumer very different set of features very different set of expectations so i think people either have to decide you're going to compete everywhere or pick one thing and just nail it and if i was open ai and you had to pick one thing you would pick consumer because they're the juggernaut and they're the clear leader and they have an enormous brand freeberg let SPEAKER_09: me pull you into this because my base case here is that all consumer queries are going to be free apple is going to make them free they're already free for google i think meta is going to make them free and actually have a decent product soon and microsoft same thing chat gpt has decided to push off advertising they were going to put advertising in it you remember they got mocked by anthropic with their super bowl ads so what do you think is going to happen on the consumer side consumers generally don't pay for services that's usually five to twenty percent of the market is paid services and everything else is free and ad supported but it looks like apple and google are going to just let it rip so that could take the revenue oxygen away from chat gpt so what is your thought SPEAKER_79: here on who wins consumer i don't think that it's going to be free i think there's 290 million subscribers for spotify they're paying what are they paying 20 bucks a month or something probably less on average because it's global number but yeah netflix has 325 million paid subscribers and ai that can book your travel answer questions for you track your calendar do your email etc etc etc etc is likely going to be the most valuable call it meta service that consumers have ever seen and i think it's very likely that we're going to end up seeing many more consumers subscribe to a consumer ai service than we've seen even with cable television i mean think about your cell phone everyone's paying 50 60 bucks a month for a cell phone why not pay 80 bucks a month more more you SPEAKER_90: pay bucks you pay 100 bucks and by the way in the pandemic remember what we saw the two things that people refused to cancel was not your mortgage payment or any car payment you were willing to go into arrears and into default the two things that people would would always keep was the cell phone SPEAKER_152: number one and then electricity number two chat gpt will be there so i think that's going to be the case SPEAKER_79: with these consumer apps jacal i think that they're all going to be like ultra valuable and they're going to layer in services on top of them like for example do you want to watch video embedded in your consumer ai app do you want your consumer ai app to you know do your finances for you and it could be that the consumer ai app becomes the new platform much like the iphone was for the app economy there could almost be whether it's through kind of connectors or embedded tools an incredible ecosystem that were traditionally advertisers actually pay to be embedded and show up inside of the ai app and the consumer can either pay for it or the advertiser can pay for it so i think there's going to be um a very different economic model and still very early days sacks the numbers SPEAKER_09: right now would uh be more in my estimation about 50 million people subscribe to chat gpt they got a billion users or they're trended to a billion i think they probably hit it in the next month or two certainly they had 900 million two or three months ago so it's about five percent where do you think this winds up do you think it becomes you know 300 400 500 million consumers are willing to pay 20 bucks a month for this or do you think it's more free and the data and the ad supportedness of it SPEAKER_05: go the meta and the google route i think it's possible that you could get a few hundred million subscribers for the premium tier look i think most consumers will take the free service in exchange for advertising right some ad supported model which by the way i think could be quite successful when chat gpt started displacing google for search a lot of people were predicting the death of google's model because who'd want to look at 10 blue links i think that's true but i think you can do something much more compelling in ai chat compared to just a list of links so in any event i think ad supported models might make a comeback here in addition to premium models all that being said though you know as an investor i always liked b2b businesses better than b2c because it is hard to monetize consumers their willingness to pay is not that high and they tend to have high churn rates whereas businesses tend to be very sticky and you can upsell them and you can get more than 100 net dollar retention year over year so if you can make an enterprise business work it's always been a model i've i've liked but you know that being said obviously some of the most valuable companies SPEAKER_161: in the world are consumer companies meta google apple these are all consumer first companies and SPEAKER_09: look i think ultimately both models can work obviously both can work question is which one i guess it really comes down to how motivated do we think google and facebook will be to build that bridge from their ad networks to their ai offerings obviously facebook is kind of mia in all of this SPEAKER_67: but google is not and i think that will be the determinant here is well google is going to compete SPEAKER_05: very vigorously for the consumer because it is existential to them i mean it's very clear that search and ai chat are kind of merging into one space that means that ad links will kind of merge into being in chat advertising so they have to adapt with that and compete for the consumer i also think that google is in an outstanding position to do the whole open claw thing because they already have access to your calendar your documents your email so the agent doesn't really have to earn your trust because you already trust google with all of your stuff right so i'm kind of waiting for the google version of open claw because i don't really want to share all my documents with some new service they're SPEAKER_90: the only one that has so much free cash flow that they can almost view it as two separate companies which it effectively is you know gcp over here runs the enterprise play and then google consumer over here runs the consumer chatbot play and they can keep them segregated that's so much harder for a startup to do because on top of just keeping everybody organized you have the financing problem of constantly having to raise more money because you don't yet have a profit engine that spits out cash they're probably the only one and you can see it in the valuations actually which i'm going to get to in a second but people believe the durability of google more than they believe the durability of SPEAKER_09: anything else and uh sax i think you weren't on the pod last week or maybe two or three weeks ago but google has announced google workspace studio to do ai automation and it's uh yeah it's online and people SPEAKER_67: are playing with it already so they have joined the open claw party by the way jace pal you asked a different SPEAKER_90: question earlier as well which is around the pe story and i think the pe story is a window into the rest of the broader market the real open question is what are these companies worth there's like a very threshold question it's sort of like a very important fork in the road right at the outset which is do you believe that we're on a path to super intelligence where everything is incredible where there's infinite abundance where you can magically describe things and beautiful things appear complex things appear groundbreaking things appear or do you believe that it's good next generational software and the answer to that question is really important because we're financing things like it's SPEAKER_09: the former and uh gc has a big move in this hamant was on the program in january when we did the SPEAKER_67: interview show and he's got gc buying up and rolling up accounting firms etc healthcare firms hospitals SPEAKER_09: etc this seems to be part of the future of venture capital is taking ai sacks and actually buying out or i should say big vc kind of starting to look like private equity buying out hospitals accounting firms SPEAKER_76: business processing firms in india putting them all together and then running them with ai so any any final thoughts on that sacks as a business strategy well i think it's interesting they're kind of betting SPEAKER_05: on the idea that they can own the change management around ai and this is the thing is everyone just kind of assumes that you throw ai over a wall and a business just automatically knows how to use it and drive efficiency from it and what we're seeing is it's pretty difficult chamath you've seen that there's mckenzie studies showing that like 95 of enterprise pilots aren't successful there's tremendous value latent value in ai but it's hard to know exactly how to deploy it at this point in time so i guess what these private equity firms are saying is that we know how to drive value from SPEAKER_13: this and if we own the business and then own the change management then we'll be able to SPEAKER_90: you know create value that way their business model makes solving this problem existential and this is sort of along the lines of this essay that i wrote let me just give you the thought Chamath Palihapitiya: exercise and you guys react today we live in a world where the whole market is trying to debate what is the p e ratio that you'd be willing to pay so facebook is incredibly durable i'm willing to pay 30 times nvidia is really durable i'm willing to pay 40 times tesla is incredibly asymmetric to the upside i'm willing to pay 200 times and then caterpillar or john deere i'm willing to pay 15 times i'm just using these as an example and what it's effectively signaling to you is how durable all of these cash flows are and all we do in the public markets when we make an investment is we're just guessing when do the cash flows run out and we try to say well here's how much it's worth and here's how much i'd be willing to pay for today but if you go back to this example and you say well what if there's this super intelligence on the horizon i think it's fair to ask the question what is anything worth and what is anything worth in year 10 or year 15 or year 20 because if you have infinite abundance and you have all this creativity won't all companies be disrupted and won't we be in this constant churn of everything getting disrupted all the time and if you were faced with that problem in the public markets how would you react and i think the canary in the coal mine are the sas stocks yes we jokingly call it the sas apocalypse but i think it's much more important i think it's a big societal question how do you view capital markets how do you view the health of a company in a world where we've been told there's a super intelligence on the horizon that makes everything much more fragile than it was before and the market reaction is to put all these companies on a spectrum and they started here in software and they're re-rating everything down and they're changing the way that things are being framed from price to equity to a multiple of the cash that you have on hand and i think that has huge implications mostly to silicon valley and largely to employees because we all sell the dream we start SPEAKER_32: a company and we're like okay small salary big equity upside but that's implicitly saying in 15 or 20 years this thing is going to be worth some gigantic number but if instead every business gets disrupted Chamath Palihapitiya: every five or six years all you're going to end up with is just the cash and so what should employees do the rational reaction from employees will say you know what i don't want your equity give me more money and if all of a sudden you do that the valuation multiples and the complexity changes again so i had my team put this chart together okay what is this took a handful of sas companies and took the mag six and i just said okay if you take the market cap and you divide it by the annual free cash flow what that tells you is how many years does it take to get back if you bought a share of stock how many years does it take from the free cash flow to come back so that you've earned back the cost of one share snowflake in 2023 it would have taken you almost 100 years and where is it now it's been cut in half service now it's last year in workday you see it and i think what this speaks to is the beginning of this re-rationalization in the public markets of saying if super intelligence is coming we have to be very careful about what we're willing to pay for these things but if you look on the right hand side and the mag seven what's so interesting is apple microsoft meta and alphabet the market is completely flipped the other way and what they're saying is we believe that these cash flows are essentially monopolistically durable forever that's the only reason why you would walk them up like this except nvidia which is the most unbelievably accretive well-run company highest margins you know making 200 billion dollars and they're treating it like they're treating service now and snowflake i just think it's so interesting what's happening i can't explain this but here this data sort of shows this reset that SPEAKER_09: we're going through a very complicated reset in the capital freebert what's your take on this reset as SPEAKER_67: chamoff describes it do you think this is just a flight to the quality of the free cash flow of the mag six and just how much cash they print and then maybe the other ones are smaller footprints and they're SPEAKER_09: just more disruptable we had this discussion many years that google and apple microsoft they would all be disrupted at some point facebook and that just simply hasn't happened they've gotten much more nimble at copying products or incorporating you know features and products into their core offering so SPEAKER_78: your thoughts it's probably generally correct that there will be a decline but there's also the SPEAKER_79: selective opportunity did you guys see the lp slides that went on the internet from toma brava's lp conference yeah those are great nick maybe you could find that they kind of highlight that within the broad market scape there are companies that are not just going to sit idly by and let ai kind of delete their business value but they're integrating ai themselves and they've got high quality people to do so and they're reinventing their product themselves so they've already got a beachhead they've already got customer access they've already got enterprise users and in fact if they can integrate ai into their products and into their tools there's almost this like selective dispersion that happens in the market and so the winners are going to win i think truly in every market not just in software but across every market including in industrial supply chains on who is going to implement and utilize ai tools and agents to do work and it's going to expand the work productivity of that organization not just create new features which is what we focus on when we talk about software companies but really imagine a complex business being able to do 10 times the output it can do today with the same capital equipment and the SPEAKER_90: same labor force freeberg what do you pay for in a world of super intelligence versus in the world of SPEAKER_192: non-super intelligence in terms of the durability of the business yeah it's hard to say man i mean we don't know right and that's why all the discount rates are going through the roof and that's why the valuations SPEAKER_79: are collapsing because we just don't know what multiple or what discount rate you apply or what terminal growth rate or which which effectively implies what do you do in your pa like do you say SPEAKER_153: i don't think disneyland is going anywhere you know i think there's some stuff that you could say is the counter ai portfolio and the counter ai portfolio i think it's like physical experiences halo SPEAKER_79: they call it halo high asset low obsolescence okay that's a great ex yeah i'm not a big investor trader like you guys but that makes a lot of sense i mean i think that's like intuitively to me that seems to be an area where people are going to be spending a lot of time and they're going to they're going to have durability in those businesses i i think businesses like nat gas production you know i just bought uh lng that chenier company chenier yeah chenier i bought chenier SPEAKER_153: given um all the craziness in the middle east and you know i visited there with doug bergham so it's the first time i've ever been exposed to this business and i checked it out business it's a great business really well-run business so i think that's got durability obviously unless it gets blown up by some enemy uh that would that would be a problem so the atoms thesis that tk share atoms real life mining is a great one obviously i think the space industry is going to be a lot bigger than we recognize i actually think there's probably a 15 to 30 trillion dollar a year economic opportunity on the moon that kind of a business like you're going to see with spacex's ipo is going to have an insane multiple so i think to your point shaman there's a lot of stuff getting steamrolled here with crazy high discount rates where you just don't know and there's a bunch of stuff where the pathway over the next 15 to 30 years is maybe independent or unlocked because of ai and then there's a bunch of stuff that's just unaffected that and that that starts to get a higher SPEAKER_205: multiple because that's where capital starts to flow sax there are probably three things that we SPEAKER_09: would agree are great moats for businesses brands network effects and the management team those come SPEAKER_69: into play here as well yeah i don't know if i would consider management team to be a moat i mean SPEAKER_161: it's like warren buffett says that you want businesses that are so strong that they could be run by a bunch of monkeys because one day they probably will be well i was thinking more like SPEAKER_99: obviously elon and tesla is going to just relentlessly innovate it's a great point by the way and SPEAKER_157: it's true especially in the age of agentic ai yeah i mean look i think though that just up leveling a SPEAKER_05: bit i think you are right that the key question is moats because i do think that there are still strong moats in a lot of different kinds of businesses and a lot of them are very subtle like you said some of our network effects some of them are the the difficulty of producing physical world products things like that so there's a lot of different types of moats out there and that is the key question as we enter a world of let's call it digital abundance yeah the network effect SPEAKER_09: of apple's ecosystem and they have hardware right and they've been just on that path of making their own silicon that's incredibly defensive and they have brand right so that that is pretty strong for apple and then you'd take tesla the same thing you got elon relentlessly innovating and it's hard SPEAKER_214: hardware stuff and then if you look at meta and google these are incredible brands with great SPEAKER_215: management teams my assumption constantly innovating if i had to bet i'm gonna bet that brands go to zero SPEAKER_90: really yeah because i think that when you can make things that are as good or better and you can make them in a cheaper faster better way people want that abundance more than they want an affiliation to a brand example so the perfect example is actually what tesla did to bmw you know what tesla did to mercedes what tesla did to porsche what byd and geely have done to the car manufacturing cycle in china Chamath Palihapitiya: this is a fundamentally cheaper faster better product yes it's got a great brand but nobody's SPEAKER_90: going to pay a premium for these products the reason why y has outsold everything else is because the model y is priced better and it's superior on every operational dimension of comparison that's also Chamath Palihapitiya: true for the cars in china so i think it's the opposite i think that brands and the pricing power brands other than maybe premium luxury goods but even that's eroding like look at the stock like i don't know nick show the stock chart of lvmh or ferrari this is not a commentary on the quality of the actual product but what this shows an erosion of pricing power all of these things are being eroded SPEAKER_09: away yeah this would be the value prop most people in brands would just say value propositioning so jet blue is a value brand a tesla model y perfect example of a value brand and if you look at apple's recent cohort what did they focus on the apple macbook neo which is a value laptop 600 bucks 700 David Friedberg: bucks so they're even going down market to try to capture that value and to your point maybe the right SPEAKER_90: word is abundance like the brands that bring abundance that bring more to the table than their competitors and they are able to bring more at the same unit cost or less capture share that's probably SPEAKER_09: true you know what's interesting about that shema as we open up the aperture of this if you one of the thesis we talked about here a couple years ago say what happens with ai disruption job disruption etc costs coming down on cars with model y getting cheaper cyber cab coming in byd obviously if you go to any foreign country byds are everywhere and they cost 15 grand then you look at apple making the neo that's a 600 laptop everything getting cheaper seems to be happening i just think it's very hard to SPEAKER_05: know which these companies can be disrupted a year ago on this pod we were saying that google was going to be toast or some of us were saying it basically yeah okay fine but yeah you know it looked to us like chat gpt was taking a massive share from google search and the adwords model was becoming obsolete now because of the success of gemini and the potential for personal digital assistants personal agents i think we're probably pretty bullish on that company and look at their stock chart it's reflects that i mean i think it's doubled in the last year now you take something like apple on the other hand and i'm not saying this is going to happen but i'll just throw out a counterfactual which is what if your personal digital assistant or a personal agent gets so good that you don't need to check your phone you just tell it what to do and you don't need the wall of apps anymore i mean the way that you call an uber won't be to punch a few buttons you'll just tell it what to do David Sacks: so you could imagine the phone operating system getting disrupted if the agents are good enough SPEAKER_90: you're on to something huge because what you're saying is i can confirm this to you 89 we sell enterprise software i'll tell you three conversations with huge enterprises asked exactly Chamath Palihapitiya: what you just said and we jokingly called it strangulation as a service which is they all say the same thing what you just said okay look get all this complicated ui out of the way get all of these products out of the way find a way to create a shim where i can just write what i need SPEAKER_90: tell it what i needed to do it deals with all this complexity in the background i never want to see these things ever again and that's what people want to your point they want they want to be able Chamath Palihapitiya: to like say okay pay this with my venmo or use my mx in this situation or get me that flight in David Friedberg: some way and have all these wonderfully smart agents do all the work behind the scenes and that's SPEAKER_125: actually tracks with exactly what i've seen with open claw perplexity computer clawed co-work instead SPEAKER_09: of going to your notion instead of going into your gmail instead of pulling up your calendar you ask it hey what's on my schedule this week it brings it to you so you could you could have a SPEAKER_67: dumb you know flat terminal you know chat interface on the 100 device and it would do just as good just SPEAKER_05: to make the counter argument against myself i mean yeah even though i think that you'll just increasingly tell your agent what to do instead of be clicking around or you know touching the screen you still need a dashboard or a user interface to like check on it and just see readouts of information you still need to be able to visualize it where is the uber that i've asked to be sent to me how far away is it still want to see it on a map so i could imagine that even if let's say you know siri plus plus becomes the dominant way of interacting with your iphone you'll still want that apple user interface hard to say i mean i see a lot of people out there tweeting that apple is brilliant for kind of missing the whole ai wave and not spending a lot of money on data centers or capex and then there's other people who say well wait a second they're they're missing critical capabilities then there's a question of will they be able to make deals for you know an ai powered siri SPEAKER_73: i don't know this is very hard to know at this point in time all right and we will be discussing SPEAKER_09: all these hard topics at liquidity may 31st through june 3rd chamath some big announcements here from SPEAKER_218: you you have taken control this is what happens in the game of thrones known as the all-in corporation SPEAKER_229: the partnership the partnership if we can call it matchup the chaotic partnership no mids there it SPEAKER_13: literally is chaos wait wait why are we doing this in california i don't even think it's i can go back SPEAKER_232: to the state at this point in time you can come for 48 hours making it i don't know by the way there are some people's acts that zero days in state at this point i love it i love it you can do 48 hours SPEAKER_234: it's okay well gavin newsom might meet you at the airport you could get picked up at the airport SPEAKER_153: the air by the way the airport is about 10 minutes from the venue you could fly in and fly out same day SPEAKER_235: and you don't have an overnight no is that how it's counted that's how it's counted as an overnight Chamath Palihapitiya: in california head on pillow yeah you can come in on monday then fly out fly out to incline sleep you know at our friend's house and then fly back in on tuesday and then fly back out you'll be fine SPEAKER_240: or you could fly to vegas do a blackjack run overnight blackjack run and then you come back in the morning we just freshen up just get your fresh shirt nice and rested let me announce the SPEAKER_00: next two speakers oh my god i'm so excited but just for background trimoth comes into this thing liquidity was this little conference i did it's now part of all in and i start setting up all the speakers and then trimoth goes not good enough i'm not showing up unless i pick all speakers and you know what freeberg and i did well finally this melon farmer is going to actually do some work great what did you call me what's melon farmer it's a when um they play a quentin tarantino movie on like tv instead of saying mother effer samuel jackson says melon farmer oh i see so this melon farmer SPEAKER_37: took unilateral control of the 10 speakers 10 speaker slots very coveted okay so we've announced dan loeb SPEAKER_27: we've announced sarah fryer incredible and i'm very very very honored and excited to announce that bill ackman and andre carpathy will also be speaking at liquidity four heavy hitters six to go SPEAKER_37: two more goats on the roster of goats so goaded and we have a handful of other yeah there might be some SPEAKER_129: surprise guests unannounced guests show up tvd can't say tvd tv more announced soon but we're making let's get SPEAKER_231: dario to show up dario come to the show come hang out with the all-in boys i'm really excited you SPEAKER_27: know what andre's gonna do what andre agreed to do is he's gonna do like uh five or ten minutes of slides on like the future of the world with ai and then we'll do a fireside love it that's gonna be David Friedberg: tremendous and you know he's uh he's been on a heater himself with his recursive uh github oh dude SPEAKER_27: auto research is incredible and bill ackman has a ton of points of view on all of this stuff so we'll get a lot of his thoughts i want to give a shout out to freeberg because when we did the interview Chamath Palihapitiya: with jensen he's like guys i was like i like had a glass of wine on a sunday like five coded a replacement to my hris system i asked all my team to do it and i was like oh my god this is incredible so i asked our folks i'm like hey i don't like the website this is 80 90. and the next day they're like yeah we vibe coded a new one we'll have it up and then i'm like well do you like the ctas and how it's doing they're like no no no we put it into auto research and we doubled the click-through rate SPEAKER_37: and i was like to freebrook's point this was this would have been many man months tens of people and instead all these recipes by the way these playbooks you know like the person that runs growth at open ai publishes his recipes yeah you've been claw-pilled that's it you've been one-shotted it's really incredible this is why like i mean you commented on my post yesterday i wake up SPEAKER_32: every day and my head spins i'm like what is what is going on in the world it's crazy like SPEAKER_153: every day feels like a new era right now yeah and it's hard it's disoriented because i think what's really interesting is you pull what would have normally been something that's call it a period of time out like a year out or two years out and you can pull it in and say i can get that done in three days and i don't need to hire people all the sequencing and staging that would normally go into accomplishing something has been reduced and then the time rushes in so all your ideas rush into you and they're all like immediately accessible and that's why it's like so every day it's like oh SPEAKER_09: my god it's disorientating yeah yeah that is i i have i bought the domain name annotated.com like 15 years ago for four grand and i wanted to create a service like a bookmark service tomorrow you like highlight a paragraph from the new york times and then you write your comments on it saves it and you basically have the service and i was talking to some developer about making it and i literally vibe coded it and the chrome extension this past week and i was like okay i've been sitting on this domain and project for like 15 years and i did it in a weekend isn't it crazy weird it's like very weird it's really it just makes it feel like a simulation to me that everything can just manifest itself it's the star trek version of the world like remember the replicator sacks where you just say earl grey tea at this temperature that's happening in business now you're like crm system build annotated.com build this new website for 80 90. boop and it's a replicator just gives it to you it's very strange i've only felt this feeling twice once i was on the outside SPEAKER_27: looking in i was a derivatives trader in toronto i was looking at the first dot com wave and i was like i got to be a part of this how do i get to be a part of this and i got a job and i went amp and kind of the rest was history when the original itunes but i missed the wave financially didn't do SPEAKER_37: anything for me but i was in the right place you got to the beach with a surfboard that's all that matters then the second wave i crushed and the move to mobile and social but this way feels like a hundred times bigger than that it's a tsunami by comparison i i had three of these it's probably what it's like to be at nazare in portugal you guys ever see those clips of like that crazy place where like Chamath Palihapitiya: there's like a hundred foot waves or whatever and you're just towed in and you're like okay let's here we go this could end one of two ways let it go glory or goodbye no i it was like literally when i first SPEAKER_00: saw a pc when i first got on the internet and then saw mosaic like those two moments in the early 90s and then seeing the iphone i think that like those three moments very special all right rough week for SPEAKER_09: zuck two verdicts went against meta in two days they were first found liable for allowing child predators to access minors on facebook and instagram new mexico jury ordered meta to pay 375 million in damages the ag's office there ran an undercover investigation they created fake child profiles facebook instagram these accounts were contacted by predators people showed up yada yada yada a SPEAKER_06: whistleblower and former meta engineer testified that his own 14 year old daughter received sexual solicitations on instagram then on wednesday an la jury found meta and youtube negligent for designing SPEAKER_09: addictive platforms that harmed a young user's mental health basically the plaintiff in this case sacks said they started using youtube at age six and instagram at age nine and she testified that features like notifications algorithms made the app so addictive that it caused depression and anxiety through that compulsive use you have some thoughts on this and we we had um jonathan hate right didn't we do an interview together wasn't that one of the first joint interviews free but i did SPEAKER_149: you had it yeah incredible uh these things are obviously he had a very important point which is to try SPEAKER_79: and keep kids off cell phones and social media until they're 16 and he was kind of cheerleading this this verdict but you know i'll take a little bit of a contrarian to the popular kind of sentiment on this and i'll just talk broadly about this idea of port litigation port litigation you know costs our economy 900 billion dollars a year in the united states 900 billion a year that's how much is spent on the litigation costs the settlements the judgments it's three percent of gdp and it's growing roughly 10 percent per year and these civil penalties decided by juries like they're you know going against big companies like meta youtube but it's also food companies restaurants everything anytime there's a window to sue someone and extract uh value from them tort firms are all over them you know it's called the tort tax now in america it's not just losses paid by the companies because fundamentally when a big company pays out these tort taxes they're going to invest less there's less r d less product development costs stay high there's new fewer new product launches and there's all these crazy restrictions on stuff so you know look i i agree social media causes immense harm particularly causes harm for kids kids should not be on social media until they're 16. absolutely agree maybe adults shouldn't either be on and you know as adults but fundamentally i think there's an important question that we often ignore which is who is fundamentally responsible for that harm SPEAKER_153: you know should the sugar beet and sugar cane farmers be responsible for diabetes in america should the soda companies be responsible the retailers selling the soda the fda for not stopping at all and fundamentally i think we have to ask the question what role does individual choice play an individual responsibility play in this equation if everything is a liability what do you think is anything any i i think we have to take personal responsibility i think the parents that are absent taking care of their children are responsible for harm to their kids you shouldn't let your kid play with a gun you shouldn't let your kid go to some sketchy neighborhood after hours by themselves you shouldn't let your kid play video games 100 hours a week you shouldn't let your kids eat nothing but soda and potato chips you have responsibility as a parent and i think parents should keep kids off screens and keep kids off social media once the harms are known of excess use or the harms are known of exposure to the sort of thing i think there's responsibility that sits with the SPEAKER_27: parents what about things like tobacco or processed food or yeah this is the key yeah and i look i mean SPEAKER_153: the same the same is true of alcohol i mean dude like alcohol is terrible for you there's nothing good about alcohol but i think i should have a choice on whether or not i want to consume alcohol whether or not i consume tobacco whether or not i consume processed goods and the recognition that it's bad for you should be publicized by the government should be publicized by the government SPEAKER_90: right so if i have to summarize what you would say is product liability law makes no sense there should be human liability and human responsibility expectations in a society we never talk about SPEAKER_153: responsibility we always talk about where the government failed us and where these companies us and we never talk about what did we individually do wrong how did i individually choose to eat 100 sodas a week how did i individually choose to get my kids addicted to social media where the was i as a parent like we don't talk about our responsibility and by the way this fundamentally addresses this point about human agency which i think is more critical in this era than ever because ai is going to flood us with everything all the time non-stop what we choose to do in a world where we're already getting everything and how we choose to not take everything that's being offered to us i think is a critical part of what's going to distinguish human success from human failure and it's going to become more apparent in the future and not everything is about liability and not everything is about the government failing us it's about people making choices and we don't talk about it SPEAKER_09: that's my counter i i agree personal choice super important what you're probably leaving out here yeah which you're definitely leaving out here is when these companies know they're doing something damaging and they do it anyway that was the key to the rjr the whiskey companies what about what SPEAKER_153: about a a whiskey company selling whiskey to an alcoholic so what about a potato chip company selling SPEAKER_125: potato chips to an obese person i'll put those two aside because i don't think we've seen major cases SPEAKER_09: about that but i will say the auto industry knew for a long time about seat belts you remember that and they didn't deploy them rjr nabisco they knew that these were addictive and they designed the cigarettes to become more addictive and they didn't tell people about the health risks asbestos same thing lead paint same thing this has happened over and over again where corporations subvert the release of information to make additional profits so the question here with facebook is did they know how addicted these were did they know kids were being assaulted sexually and and they could have done something about it or didn't they and so agree that there's too much that's absolutely true the kids SPEAKER_194: being assaulted absolutely true yeah not releasing information about the level of addiction if they SPEAKER_153: had it that's certainly bad should the product be legal number one and if the product is legal SPEAKER_297: who's responsible for using it you know and where do we draw the line and if we don't want but if we SPEAKER_299: don't want people to make choice then we shouldn't put it out there but if you as a corporation know SPEAKER_09: it's dangerous and then you lean into that if you know uh as is the case with facebook that this is super addicting super damaging to young girls and then you lean into making it more addictive and you don't put safeguards in place and you can prove that like rjr like asbestos like what are the safeguards SPEAKER_194: on whiskey what's the what safeguards does a whiskey company put age what safeguards does a casino put SPEAKER_08: hold on you asked the question yeah age is one but i'm not it's not about age second after age which is what we're really talking about with kids and jonathan hate would agree that they shouldn't be SPEAKER_09: using this until they're 16 so i think that's a perfect analogy uh age gating and then labeling and then if they know of something that's really damaging releasing that so there was a whole thing about alcohol in pregnancy and they covered up in the alcohol industry or didn't disclose exactly how damaging it was to drink alcohol on a on a fetus or a developing fetus and then remember all those signs went up in bars in the 70s and 80s that was directly because of that so labeling information and age gating would be the logical things to do for social media and that's what's happened the past so that's the answer to your question i don't know about age gating but i think SPEAKER_153: informing parents about the risks is fine like that should be a responsibility but you know the tort lawyers are one of the largest donors in political elections in the united states they donate largely to democrats in local elections and republicans in national elections and then they are the largest donor class to elections of judges and it's it's a business and i think we don't talk enough about the business of court law um the business of litigation in this country and we often ignore SPEAKER_79: this question about choice and i don't want to live in a world jacal where the government and companies are telling me what to do and what not to do how to live my life etc actually jump in here SPEAKER_67: personal freedom and personal um responsibility versus hey corporations may be knowingly doing SPEAKER_306: parental responsibility parental responsibility in there as well yeah what do you think sex SPEAKER_05: well look there's no question that the trial lawyers want to turn meta into rjr nabisco and the cigarette companies and try to fit their fact pattern around that i just think that the activity is fundamentally different than smoking i mean smoking is manifestly harmful to you regardless of what your age is and the only reason we allow it is because of assumption of risk it's a free country i think in the case of social networking it's much more unclear what the harms are and what the benefits are and i think it's much more subjective and it's much more of a personal choice for adults and also for parents freeberg i mean one area where i disagree with you a little bit as you said the harms of this are immense and well known and understood if that's the case then let's just ban it for under 13 or under 16 or whatever it is but i don't think that's the case SPEAKER_13: and because it's unclear i think it's up to parents to decide what's appropriate for their families and at the end of the day i think the right way to deal with this is parental empowerment you give parents the controls to set screen time limits or to decide what apps their kids install now the debate has now moved over to ai apps and there's a lot of parents groups that want to ban kids or teenagers from being able to use ai chat apps because there was a couple of cases of self-harm now my reaction to that is look i've got a 10 year old and if he starts using chat gpt to get answers to questions i would consider that to be a good thing i mean i'll keep an eye on the usage but i want him to be an ai native i want him to be able to do research you know i want him to be able to know how to use these tools David Sacks: i want him to get the right skills to be successful in the 21st century in china they're incorporating ai into k-12 education are we going to ban it for our kids and teenagers i think that'd be a terrible mistake so i think when it comes to ai and ai chat apps it has to be up to the parents because there's too much manifest good that can come out of kids learning how to use these apps maybe social networking is in a different category but i gotta say i do think that the harms have been exaggerated because the trial lawyers have an incentive and just to give you some facts about that la case so just so you understand in this la case they were sued by a 20 year old woman who claimed that she became depressed because of using social media and she apparently suffered body image issues because of social media and she was able to win this judgment for millions of dollars look i think there's big causation problems with that case in in the case of that plaintiff the evidence showed that she came from an abusive home her father had abandoned her her own mother had body shamed her so it was very unclear where her body image issues were coming from i think it's possible that social media contributed to them or it could just be that social media was a scapegoat i also got to say that i do think it's it's a dangerous precedent i mean are we going to allow plaintiffs lawyers to sue spotify because you created a playlist of sad music right and that music contributed to your emotional distress i mean that's kind of what we're saying you got to remember these are free services that people have a choice whether to use them or not and if social media is making you feel bad if listening to the wrong playlist is making you feel bad then stop doing it but what's going on here i think is the trial lawyers are trying to create the next big tobacco and their goal is to try and sue these companies SPEAKER_13: into oblivion and i don't think that's the right answer either the consensus chamoff is kids who use SPEAKER_09: this two or three hours a day this has been across many um survey many research studies is that it's SPEAKER_67: massively correlated with depression and anxiety um and eating disorders specifically in young girls like if you get to two or three hours a day of this so that correlations i think pretty well established SPEAKER_09: you pretty famously said hey and you worked at facebook so you saw this coming but i think at stanford 27 2018 time frame you actually had some comments on this we could either play the clip or you David Friedberg: could just describe it i guess i said what was obvious to me then i lost a lot of friends at facebook when SPEAKER_90: i said it unfortunately but essentially what i said was i don't let my kids use it and i don't think that this is a constructive part of a developing child's diet i do think that sax is right that i view ai chat differently there are different guardrails that are required so that if you go down some sort of you know dark corner but that's possible to understand and the product is architected in a way to create cul-de-sacs so that if you're thinking about self-harm or you're thinking about these other things social media is very different it's an incredibly fast twitch algorithm and that's the optimization Chamath Palihapitiya: and until the incentive for that optimization changes these outcomes will continue to compound i think the interesting thing is that the la lawsuit was an individual lawsuit the young woman SPEAKER_90: i think was awarded three or six million dollars yeah the other one though that they lost this week was in new mexico and that was for 375 million dollars and that was more around i think child exploitation yeah the thing that i'll note is that these trial lawyers which i'm not a fan of either have Chamath Palihapitiya: been trying as sac said and as freeberg said to make these folks a target because there's so much money on the line and they've been batted back pretty successfully but this was the first time where SPEAKER_90: they were able to navigate the section 230 protections that facebook and google have typically used to protect themselves because google was a part of the la lawsuit and they were able to go down Chamath Palihapitiya: the pathway of product liability language now to freeberg's point i think he's generally right i think it's my responsibility as a parent to take care of myself and my children but to the extent we don't change these product liability laws that are on the books i think the door has been opened and a map has been drawn which is this is how you navigate around section 230 and you can get a decisive lawsuit in your favor against these large companies with enormous cash flows and so i expect that this will be a death by a thousand cuts kind of scenario where folks are just going to rally around this i don't think it's right but i do think that that's the rational reaction to what just happened i mean look six million dollars to an individual 20 year old girl or 375 million dollars these are huge numbers and the reality is that i think we've opened the floodgates i do think there should be a better response and i do think that parents should take a lot more responsibility but i do hope that these products allow us a kill switch for when our kids are under the ages of 16. frankly i would love a kill switch under the age of 18 and there has to be simpler ways to age validate you know we used to work around this thing called coppa compliance coppa's it's nothing burger like a six-year-old can vibe code their way around coppa so it doesn't do anything then so age verification is completely broken it's harder to get age SPEAKER_37: verified for a porn site than it is to get un-age verified for face same word chamath how did you get around it yeah you know you know that how do you know that's just for uploading you were uploading at SPEAKER_315: the time shabbat this is not your only proof proof of age we actually deal with this in our new SPEAKER_05: ai framework that the administration released last week because the number one issue is around online David Sacks: child safety which i think again is mostly about social networking but it touches on ai and so it's kind of gotten lumped together and i think we're i mean i'm referring now to the white house has said SPEAKER_05: it's willing to support some form of age assurance technology and parental controls so look i think there needs to be a conversation around how true it is that social networking is just a fountain of ills for young people if that's true then why wouldn't you just disallow it right but if if it's unclear and i think it's more on the side of unclear this is me uh then it's up to the parents and what you want to do is again have the age assurance technology and the parental controls and let Chamath Palihapitiya: the parents decide i don't think that social media is net bad broadly speaking but i will tell you SPEAKER_90: that if my child uses it for two or three hours a day for multiple days in a row they become retarded SPEAKER_276: yes they act weird and so i don't know what to tell you except i would love a kill switch until these SPEAKER_90: kids turn 18 on all these products well you can this has to do with dopamine by the way these what i do Chamath Palihapitiya: instead is i use apple's family sharing but it's hard and i'll tell you how why it's hard our schools give our kids chromebooks and say use these chromebooks because that's the way you're going to access your lms your information your content your homework and you know what's an integral part of that youtube and then now it becomes a backdoor so even when we take the devices i take my devices we lock them down you can't bring them to your room the whole thing but if they need to do homework and i catch them in a little break i'm like what are you doing on youtube they're looking at shorts of course that's David Friedberg: what they do yes and so it is a whack-a-mole problem for parents i think uh i'll just give SPEAKER_125: myself the final word here on behalf of the group it's obviously addicting it's obviously the industry SPEAKER_09: has not policed itself nor would they police themselves because they want to get people addicted now so they're addicted when they're adults the rest of the world has realized this australia now has 16 enforced malaysia 16 other countries are right behind them spain germany uk and what should happen here in the united states is this should be done with the handset manufacturers if android and apple showed leadership with facebook and said we're going to by default when you buy a phone you're going to have to age verify you know kids under a certain age which you kind of do already SPEAKER_00: when you create a family plan like you did we could solve this problem and then parents would opt in to giving their kids access to this no good comes out of kids under 16 using social media and jonathan hey by the way in our interview said you should be putting phone lockers in and our school is doing SPEAKER_324: that other schools are doing it is the greatest thing ever kids are school no and then they love it SPEAKER_90: i don't think it's that great i'll tell you why our school does the phone condoms i don't know what they're called but like you put them in the bags and you whatever the real problem is that there's enormous social pressure when you're in high school to use these products i'll give you a specific example our rule is you cannot get instagram or tick tock until you're 16. i would love it to be 18 Chamath Palihapitiya: but we all agreed 16 and we're able to maintain that rule but then high school comes around and i have two kids in high school now oh we need snapchat no you don't no yes we do no you don't okay great we'll have no friends thanks a lot we'll just sit here in our room dark and there and you know there's an enormous amount of social pressure so when you talk to the other parents it's like hey guys can we all agree that we don't need snapchat you just can't get uniform agreement across all parents because everybody views this problem differently and so i had to change the rule now when you get to high school you're allowed snapchat but not instagram and you know when you're 16 you get instagram and SPEAKER_27: that's the best we could do and tick tock all that stuff but yeah it's an impossible task for a parent SPEAKER_226: i find it indispensable to be able to do iMessage with my kids and also i like the location awareness SPEAKER_05: you can track location you compare iMessage those features to snap is it really that different i don't think it's that different well so you're really gonna you're gonna you're gonna ban snap SPEAKER_90: no i can't my point is i had to give them snap but you're right i was like why can't you use iMessage they're like dad don't be a loser yeah no i signed for a snap account just so i could iMessage them SPEAKER_05: where they are where they're messaging i prefer if they were just on iMessage but anyway that's the reality so you can talk about banning all these things but again i think you're on a slippery slope SPEAKER_333: and i gotta i gotta just point out no i'm saying me as a parent banning no i'm saying me as a parent SPEAKER_90: yeah you're setting guidelines in my house these are the rules when you become a freshman i'll give you snap and when you're 16 i'll give you instagram and tick tock otherwise shut the up put your head down by the way i also have a tip for parents you know this issue with SPEAKER_09: like kids in headphones where they want to be listening to stuff all the time and your kids walking around like zombies with headphones i replace their headphones with over the these brand called shocks or something it goes over your ear but your ears open so you can listen to SPEAKER_00: an audio book or music and still be able to talk and so since we did that it's like much less drama around the over the ear headphone issue managing teenagers well again it sounds like you're exercising SPEAKER_05: parental supervision yes it really makes sense that later when your kid turns 20 they could sue these SPEAKER_341: companies for well to your point i just think emotional distress that doesn't make sense you're Chamath Palihapitiya: right because to your point that girl said she was using it from the age of like six and ten yeah it's one product six and yet that's crazy crazy i agree with you sax that's crazy where were the David Friedberg: parents all right we got time for i think one more topic be amazing president donald trump 47th president SPEAKER_336: in the united states announced his council of advisors on science and technology it's called pcast SPEAKER_00: sax you have now am i correct in saying moved from the czar of crypto and ai to now the leader of pcast SPEAKER_226: is that the correct way to frame this well the president has appointed me to be a member of his SPEAKER_05: council of advisors on science and technology and to co-chair it along with michael kratzios who's the director of ostp i'm still a ai advisor but i do it on behalf of pcast now so you remember last year i was in sge we got up to 130 days i use that time up and the president appointed me to this new role allows me to continue being a technology advisor in fact on a wider range of issues so before it was ai and crypto now it's whatever pcast wants to study or talk about or make recommendations i think in addition to ai other areas that are interesting are nuclear power quantum computing advanced semiconductors all these different areas i think we've got some biotech thank you freeberg and we have some incredible people who are now on pcast to kind of run with this yeah i'm looking at it mark SPEAKER_67: andreessen sergey michael dell larry ellison david friedberg jensen uh lisa sue mark zuckerberg and some other folks there that uh maybe not as uh recognizable by the audience how were they selected SPEAKER_09: sacks the only criticism i've seen of this is lots of business leaders great lots of technology great but maybe a little light on the scientists well i don't know we have people who've won a nobel prize SPEAKER_05: for physics on there we're talking about people who are experts in like i mentioned quantum computing fusion nuclear biotech pretty much everything across the board i would say that one difference between this pcast and previous ones is you have more doers more builders people who've actually created products or companies we think that's a good thing why would it be a bad thing i mean is it a bad thing that mark andreessen invented the first internet browser or jensen invented the gpu if you're gonna make David Sacks: recommendations about advanced semiconductors don't you want to have someone who actually invented some SPEAKER_10: of the key products in the space the big question of course sax is as we've seen here with science SPEAKER_272: corner is how do you plan on staying awake for these meetings if it's going to be like all science is usually when you take your your bio brain well it's science and technology so you'll be so i'm David Sacks: going to focus on the tech stuff got it and then we got freeberg to focus on the science stuff got it SPEAKER_218: so freeberg this is incredible you've joined president trump's administration now i will say SPEAKER_25: i'm honored to be invited and appointed by the president and i appreciate sacks and michael kratzios SPEAKER_79: you look back at pcast it's kind of rooted in fdr when he formed this council of advisors on science when nuclear physics and quantum mechanics was starting to kind of reinvent what was possible in the world we're sort of at a similar era today because arguably ai is reinventing what is possible in the world and i think there's this kind of acute moment that we find ourselves in in this extraordinary race against china i'll give you a statistic 10 years ago china published 50 of the number of scientific research papers and peer-reviewed journals as the united states last year they published 50 more than the united states this is across all disciplines and domains including physics material science chemistry biochemistry broad life sciences there's this moment that we're in right now where both the world is being reinvented by ai but there's this extraordinary race with china not just in fundamental research and discovery but in the industrialization of new discoveries and new technologies you could feel it in dc this week i was at the hill and valley forum but literally everyone in silicon valley everyone in dc is is like absolutely honed and focused in on what is going on in china it used to be in biotechnology for example that china was kind of a copycat and me too or they were really good for example in manufacturing but it is now the case that in many subdomains china is becoming the scientific leader in biotechnology and in life sciences and that is a scary thought because ultimately china could end up engulfing the entire pharmaceutical industry and basically becoming the leader in things like medicine but most importantly foundational things like ai so i just want to defend and speak for a moment about the choice about putting what i would say are like industrial science and technology leaders on this commission because this is a moment where there's an industrial race not just a discovery race underway that's why this moment is so critical anyway i'm very appreciative to to have an opportunity SPEAKER_82: to serve and thankful to david for his leadership in related news will be joining the president's SPEAKER_09: advisory council on bomb pots and wagering will be joining that and when i saw this sacks i saw ppc SPEAKER_218: and i was like oh is it podcasting i'm in finally i've been invited to the president's council SPEAKER_00: on podcasting so big big news coming i don't want to tip anybody's cards we'll let you know when SPEAKER_365: that happens yeah absolutely when the president's council of podcasting emerges me and lex friedman SPEAKER_05: will make our way to washington dc i want to thank the president as well and it's a great honor to be named to co-chair this it is like freeberg was saying this is a fairly august body that goes back a long time i think the modern incarnation was created in 1990 by george herbert walker bush so this has been around for over 30 years in its current formulation i think we have a slightly different take on it which is we're going to have these these builders and doers on there like freeberg said we got some catching up to do on our industrial policy we have named 15 people there's still nine more slots we can have up to 24. so i think it's possible that at some point there'll be a second round and if we're missing some expertise they can be filled in obviously that's up to the president he can decide SPEAKER_370: later who else might join this all right everybody that's another amazing episode the number one SPEAKER_385: podcast in the world the all-in podcast bye-bye love you boys