I see a large IPO on the horizon.
You're surrounded by jungle. Hold your position.
Overnight success.
The place of 3,000.
Double.
Right.
There's misinformation.
Quantity clearing order inbound.
Let's just roll.
We are surrounded by journalists. Hold your position. Come on. Get up.
Trust the experts here.
Five. Focus.
We are.
Founder Mel.
I see multiple journalists on the horizon. Stand by.
UAV online.
Blaze.
Double blaze.
Triple blaze.
Double kill.
Top is.
Wins.
Team deathmatch.
We are experts.
Triple blades.
Let's just roll. Right.
Clearing order inbound.
You're surrounded by journalists. Hold your position.
Strike two.
Activate golden retriever mode.
Marky clearing order inbound.
Five.
I see one more journalist on the horizon. Stand by.
Founder.
You're watching TBPN. Today is Friday, March 13th, 2026. We are live from the TBPN Ultradome, the Temple of Technology, the Fortress of Finance, the capital of capital. Let me tell you about ramp.com. Time is money. Save both. Easy use corporate cards, bill pay, accounting, and a whole lot more, all in one place. Boy, is it good to be back.
It's great to be back. But it's Friday the 13th, so you know what you got to do.
Salt over the left shoulder.
Oh, yeah.
You know about this?
I didn't. I didn't.
Throwing salt over your left shoulder is good luck. It counteracts bad luck. Friday the 13th. Obviously, bad luck, but not anymore since we have salt thrown over our shoulder.
Good hack.
I was very interested in Patrick Collison's post. We talked about this a little bit. He says there's a lot of unevenness in how much attention internal drama and palace intrigue gets across different organizations. As far as I can tell, this is substantially a matter of path dependency. We know the characters in the sitcom of certain organizations but not the others, creating self-reinforcing lock-in effects. How much does one hear about the power struggles at Chevron or the Department of Agriculture? There's even significant heterogeneity between ostensibly similar companies within sectors. We get it. You want a bunch of palace intrigue stories about Stripe? We get it, Patrick. Just... No, no. Stripe has not ever really been in the, you know, the tumultuous drama, oh, horse race. You know, there's been investors who have talked about various valuations, but overall, the company's been sort of smooth sailing for almost two decades. But I wanted to think about this more in the context of other countries' startup ecosystems and also...
Yeah, the closest they ever got to drama was around the Bolt fast dynamic.
That's right.
Because they backed fast.
Yeah, you're right. There was a little seemingly because they felt like some competitive pressure there. They wanted the fast checkout provider to be running on Stripe. Bolt was famously not. They had built their own payment rails.
Yeah.
Um.
But I mean the Collison brothers are just so class, they're such class acts that they don't really wade around in the mud. They don't roll around in the slob farm and it's like it's a B2B company. So there's less like just general viral intrigue around it.
And even in that, even in that whole saga, yeah, saw a single comment. No, no, no. And they weren't taking shots at anyone. They were very classy. What do you... I mean there was some controversy when the, you know, cheeky pint Elon interview came out and John Collison, you know, how many Guinnesses were they drinking.
Okay. Okay. That was a bit of palace intrigue. How many cheeky pints are they drinking in the palace?
I mean John did come out on top of that, right.
Yeah. Yeah. He explained. He explained. So, but so years ago I was talking to an American VC about New Zealand and I asked him about the startup community. The country was beautiful, he said, highly developed, democratic, it consistently ranks among the world's most stable, wealthy, and well-governed societies. And he was spending a lot of time there. I was like, there's got to be some company that can break out and become a power law company. If you're going to be there spending a lot of time, you'll probably meet cool people, interesting people. Maybe there will be a great New Zealand company that comes out of this. And he was like, I'm not so sure, because his assessment distilled down to something along the lines of they are suffering from a bad case of tall poppy syndrome. So what is tall poppy syndrome? Put simply, individuals who achieve visible success are criticized, attacked or socially cut down because they stand above the others in the crowd. The metaphor should be obvious. When you cut the tallest flowers in a field, the surface appears even.
Let's pull up Tyler for a second. Why? What is... There we go. He's a tall poppy. He's getting cut. So anthropologists often call this leveling behavior. And it goes back to hunter-gatherer societies. Good hunters might be mocked or discouraged from bragging. Sharing would be encouraged to prevent resource concentration. And there's nothing bad about a preference for humility. America has long been suspicious, and Americans have long been suspicious of the Lamborghini-driving, self-promotional Instagram course hustlers, and for good reason. Those folks are usually selling overpriced junk food, basically. But the strong form of tall poppy syndrome does lead to lower startup formation. If you think that you will immediately be cut down in your society, you don't actually go out and hunt. You actually don't go out and bring back the big deer or whatever you're hunting. The bacon. Yeah. You don't bring home the bacon in the first place. You don't even try because you're so worried about this tall poppy syndrome in your society. So you wind up with lower startup formation, fewer truly scaled companies, less aggressive growth plans, and ultimately a talent exodus or brain drain. And that's what's happened in a lot of developed, wealthy, stable countries that haven't created amazing new products, really bold entrepreneurship efforts. A lot of it's because of the tall poppy syndrome. So America's never had this problem and I don't actually think we're that close to developing a crippling case of tall poppy syndrome anytime soon. But it's worth understanding how these leveling behaviors shape the narrative in tech. So there's this unevenness that Patrick Collison identifies around internal drama, attention. It does not seem correlated with market cap at stake or even how well-known certain founders are at the time that something's happening that could be dramatic. So I was thinking back to Elon Musk and Tesla. He's like perhaps the most household name entrepreneur in history, certainly right now. Tesla has something like a trillion dollars of market cap at stake. If someone leaves Tesla to start a competitor, that should be incredibly dramatic.
Do you know who I'm talking about?
I do. Who is it?
Because I took a pass.
Oh, you took a pass. Okay.
On your essay, but I don't remember his name.
It's Peter Rawlinson. He designed... He was the chief engineer of the Model S at Tesla, their super successful, you know, high-end sedan. The thing that really ushered in the EV boom. He's the guy that engineered it. He leaves. He goes to Lucid Motors, eventually becomes the CEO and the face of the company. Develops a direct competitor to the Tesla Model S, which is now discontinued. The Lucid Air is fancier, faster. It has a whole bunch of other criteria that satisfy that market segment. And it should be like this knockout dragout fight that's very interesting. Lucid hasn't put a dent in Tesla, you know, largely, but it's still such... it is palace intrigue and yet no one really cares. And most people in tech can't even name a second person at Tesla after Elon. Maybe JB Straubel, Redwood Materials, but he's out now.
Yeah. Karpathy.
Karpathy. Yeah, that would be one, but it's like... Like who's active at SpaceX? Everyone knows Gwynne Shotwell, but like beyond that, Kiko Donv. Who else? Like it gets really, really hard. And why is that? Well, some industries, some companies have different cultures. So if you think about Tesla, Chevron, Department of Agriculture, they're probably not encouraging their employees to go direct. They might actually be discouraging it. They might have rules around what you can post about publicly.
One xAI employee went very direct.
He went very direct and it didn't last long at the company. So like electric vehicles, Chevron, oil and gas, the Department of Agriculture, these organizations don't necessarily have a lineage that traces back to academia, which is very open source. Publish your research. Go to a conference, put up slides. What are you thinking about? What are you researching? Share it all. Talk about it. Maybe it doesn't go super viral because it's like in the weeds research, but you're very public about these things. And then also the blogosphere, like in the AI world, a lot of leading thinkers, leading employees had blogs and had done podcasts before, and so it was like a continuation of that, the idea that you were someone who wrote essays online and shared all of your thoughts, that just carried through to the AI era. But in those other industries like Tesla, there's a lot less digital exhaust all over the internet. The internet also rewards taking shots at the tall poppy. Tech generally wants to appear nice and they don't want to punch down. Like when a company rises and falls, you typically don't see serious people in tech really being like, I called it, victory lap. Like it's seen as uncouth.
The company has to be doing some really egregious stuff. Totally, like a true violation of the social contract. Not just, look, everyone tried really hard, they got beat, and the investors, you know, sort of got 50 cents on the dollar back. Something like that. No one's really cheering for that. It's pretty rare, but some anonymous accounts are. But in general, aiming for the top is the only option if you do want to punch. You don't want to punch down, but you still want to punch. Where do you punch? You punch up. You punch at the top dog. And the better a company is doing, the more attention you'll get for taking a shot at it. And this is seen as like contrarian. Everyone thinks this company's dominant in this particular category. Well, take a shot at it. It's over. They're dead. And you're going to get a lot of views because it is a counterintuitive take. Everyone else has the Glazinator 3000 out. You pull out the dunk and you go viral. So, and then also you add to the fact that anyone, no matter how far away they are from Silicon Valley, what their career history is, what their background is, how much they actually understand about what's going on in tech, can just synthesize news and discourse into something that's more aggressive, more punchy, and go viral, and you have a recipe for a whole lot more dunks around whoever is on top. And that is sort of the tall poppy syndrome. But the good news is that fortunately America is still producing the fastest growing companies and attracting top talent, and the bevy of quantitative data defangs many tall poppy syndrome type attacks. You see someone saying it's over. This company's cooked. They're terrible. And then I mean, we just saw this with Cursor. Everyone's like, Cursor is over. It's dead. And then you see, okay, well they just hit $20 billion ARR, growing 25% month over month. And it's like actually things are fine. And so those sorts of data points help push back against these like, you know, attacks on the tall poppy at the time. And there's this Benjamin Graham line that everyone likes to quote that he actually did not agree with and is sort of misattributed to him. But I said in the short run the market is a vibe war, but in the long run it's a weighing machine. He of course is quoted as saying in the short term it's a popularity contest or a voting machine and in the long term it's a weighing machine. The idea that in the short term prices are determined by, you know, people just voting based on popularity, but in the long term like you always realize the value of the company and you have to return to fundamentals, and that's why he was so into fundamental analysis. Anyway, lots of interesting things going on in the timeline around this. Thoughts on tall poppy syndrome or just the dynamic in tech right now, the vibe war.
Yeah. Just the classic is like it's way easier to take down to do a takedown of a company. Yeah. To talk poorly about a company. Yep. Than get in anywhere close to anywhere close to actually accomplishing anything remotely.
Nobody likes trying to like snuff the baby in the cradle. Yeah.
But if it's David and Goliath, it's great.
Yeah. Anytime I see people that like every single post in their feed is just like a dunk, it's like, hey, like hating on other people is not going to make you successful. And successful people see people that hate on other people just assume like, okay, this person is just not very successful themselves. So, can get you some momentary attention, but positivity, haters going to hate. The chat understands this intuitively that positivity shall win the day.
Shall reign.
Let's pull up the Linear lineup because we have an absolute banger of a show. We got Eric Lyman from Ramp coming on, Travis Kalanick coming in person, Tim from GoFundMe, Gustaf from Spotify, Tony, we have a lightning round that's incredible with billion dollars funding. And then Nesh Aurora from Palo Alto Networks is coming on. Linear of course is the system for modern software development. 70% of enterprise workspaces on Linear are using agents now and you too.
It's time.
It's time for a special segment.
A special segment. So there is news about Travis Kalanick. He's coming on the show in person to discuss it. But the news broke in none other than The Information. But it was paywalled. So we have a plan. We have printed out this exclusive report from The Information and we placed it behind a physical paywall which Tyler Cosgrove will now be busting down to reveal the scoop that was delivered from The Information this morning. Take a swing at that. Break down the paywall. Oh, with authority.
Okay. Okay.
And what does he get? Hey, there he is. He's got the entire article. We have the entire paragraph here. The paywall has been busted down. Thank you to The Information for reporting. The news is Travis Kalanick plots new self-driving venture with Lewandowski and Uber. Kalanick has also been discussing acquiring the startup founded by Anthony Lewandowski who has been developing autonomous software for mining and other industrial use cases. The new venture would also represent a reunion of Kalanick with the company he founded. There's been this discussion of whether or not Travis will be involved in Uber in the future. We will ask him about that at noon in about 40 minutes. Let me tell you about Turbopuffer, serverless vector and full-text search built from first principles and object storage, fast, 10x cheaper and extremely scalable. And let me also tell you about Figma. No matter where your idea starts, Figma makes cloud code or a sketch. The Figma canvas is where ideas connect and products take shape. So other news in The Information from Cursor and xAI news. xAI hired two senior leaders from Cursor to catch up on coding. There's a whole debate going on about what's going on at xAI. Elon Musk said xAI was not built right the first time around. So it's being rebuilt from the foundations up. He said same thing happened with Tesla. So he's completely changing the strategies.
You got to wonder what kind of comp packages these new hires got.
Who knows?
It is interesting. Now Elon has the advantage of being able to use SpaceX stock to recruit people. Yeah.
Which is, you know, pre-IPO shares in a company that is unclear where it's going to trade, but Elon's obviously doing everything he can to make sure the IPO goes well. Yeah. Including putting some amount of pressure it sounds like on NASDAQ and the S&P to get faster inclusion.
So there's a big discussion over, well, xAI is worth like $200 billion ostensibly. Like what does this mean if the team is completely new? What's actually the value there? What's the core asset? There's some debate there. We were going back and forth about it this morning.
Yeah. And the only reason that I think he was able to pull that off is because one, he's Elon, but then two, so many of the investors, like it was the same group of people on both cap tables.
So the bear case is obvious. Like a fourth-tier, you know, lab not at the frontier is pretty commoditized at this point. There's lots of folks who are at that level. Getting in the game of the RSI, the frontier labs, like you got to be DeepMind, you got to be OpenAI, Anthropic. And if you're not at that level, your valuation's probably an order of magnitude lower. You're looking at like, you know, the Qwen, the XAI team, people were talking about MSL. Like even if you just broke up Meta, is MSL worth 200 billion? They have some great team. They have a lot of compute, but it's like they have... 200 million or 200 billion? Did I say million? Yeah. Oops. All the numbers are big. The bull case of course is that xAI is great at building data centers. Colossus 2 was built really fast. Is that an enduring advantage? Can they be the best NeoCloud at the very least? Is that enough of an advantage if you just build more and more compute? Is the space data center thing going to happen sooner than later, sooner than people expect, in which case you have the most compute and everyone else is tied up in red tape on Earth and you're in space? There's still a bull case but it is tricky. Benjamin DeCracker shared a story from when he worked at xAI. He says, 'When I was first hired low-level by xAI, I was extremely excited. I greatly admired Elon and what Grok could be. I have a pretty cool AI following here on X. Some big names see my stuff, including Elon himself at the time.' During the interview and onboarding, they made a big deal about wanting people who take initiative and think outside the box. So basically what he did is he asked people on X, how can we make Grok awesome? Bunch of people answered. They got a ton of... John Carmack retweeted it. There were lots of great ideas and he said he woke up the next day to a threatening email from his main supervisor at xAI telling me I had messed up and I was never to ask for ideas to improve Grok ever again. That wasn't my job. They suspended my X account. So he was very upset. And he says the manager's gone. Everyone he knew at xAI is gone. And he's sort of hoping for a new era at xAI.
S for Satoshi who consistently gives Elon I think some pretty good advice. So yeah, he's willing to say... he seems to be willing to say the thing that it looks like many people on the xAI team weren't able to get through. But he said, try this: Elon should think of a terrible idea and pitch it to his team and present it convincingly. Tell them you really believe this is the path and then fire everyone who agrees. Simple test. Basically weeding out the yes-men. But yeah, it's interesting now, like it feels like really hard to catch up in codegen even if you have some great people from Cursor.
Yep.
Like it's just so competitive and there's... I just don't see it. Yeah. But they've got to try something because he's certainly not... closer back to Anthropic and a lot of that would... You mentioned the NeoLab opportunity but certainly we've seen no indication that he wants to just like rent out GPUs.
Yeah. Yeah. No, it's more of like a bank shot where you build more data centers than anybody else. You have the most compute and then because of that you're able to scale your training runs and that unlocks some new capability. It is a stretch. Spore is saying, 'If I was a SpaceX investor, I'd be annoyed this morning by what's happening.' But John Shahiti, friend of the show, says, 'I'm not annoyed.' He is a SpaceX investor, I imagine. And there are other departures. Walter Bloomberg is citing the FT and says, 'Elon Musk has ordered another round of job cuts at xAI.' And one of the xAI employees, I left earlier this week. It was a difficult decision. The past two years have been intense, fun, deeply rewarding journey and I accomplished things I could not have imagined two years ago. Thank you to the entire Omni Imagine team. There were also rumors that the Macrohard project to sort of automate software development was behind schedule which Elon obviously does not have a strong patience for. Anyway, quickly let me tell you about Vanta, automate compliance and security. Vanta is the leading AI trust management platform. And let me also tell you about Cisco, critical infrastructure for the AI era. Unlock seamless real-time experiences and new value with Cisco. So, Apple... yeah, I'm going to fight you on this, but read it.
Apple said, '50 years of thinking different.' And then they wrote: 50 years ago in a small garage, a big idea was born. Apple was founded on the simple notion that technology should be personal. And that belief, radical at the time, changed everything. April 1st marks 50 years of Apple. From the first Apple computer to the Mac, from iPod to iPhone, iPad to Apple Watch and AirPods, as well as the services we use every day — the App Store, Apple Music, Apple Pay, iCloud, and Apple TV — we've spent five decades rethinking what's possible and putting powerful tools in people's hands. Through every breakthrough, one idea has guided us: that the world is moved forward by people who think different. That's because progress always begins with someone — an inventor, scientist, a student or storyteller — who imagines a better way, a new idea, a different path. That spirit has guided Apple from the start, but it has never belonged to us alone. And I won't read through the whole thing. But so Pram says 100% AI generated. They used AI to detect the AI and that's how...
So they got him dead to rights, right? Oh, Apple's cooked.
SNW says huge L. Apple has already been committing seppuku, but dang.
Okay, let me read you.
And to be clear, okay, the same account rebuttal went and found other Apple Newsroom articles that show 100% human written.
Okay, let's turn back the clock. Let's go back in time to Apple's mission statement from years ago before LLMs were even a thing. This is their mission statement about Apple. Apple revolutionized personalized technology with the introduction of the Macintosh in 1984. Today, Apple leads the world in innovation with iPhone, iPad, Mac, Apple Watch, and Apple TV. Apple's five software platforms — iOS, iPadOS, macOS, watchOS, and tvOS — provide seamless experiences across all Apple devices and empower people with breakthrough services like the App Store, Apple Music, Apple Pay, and iCloud. Apple's more than 100,000 employees are dedicated to making the best products on earth and to leaving the world better than we found it. They've always sounded like this. Like the LLM's trained on Apple comms and if you go to an LLM and you say, 'Write me something in the style of Apple,' it's going to nail it because every Apple communication is in the corpus. And so, of course, whether or not they use AI, it's going to detect as 100% AI. It's the same thing as Paul Graham using the forbidden sentence structure 10 years ago. Yeah, that's my take. Do you disagree?
I just think Apple would use AI. Did you buy that through Pangram? That one... like if you run Paul Graham's old essays, they don't come up as AI even though like yeah, there's a sentence that like maybe is, you know, in the same style, but let me see.
How do I scan for AI? I need to create an account.
Let's see. Let's see. John, I'm trying. I'm trying. It's creating. Send me the link. Okay. I got it. I got it. What's my role? Other personal use. I was referred by a friend, colleague. Now I have to pay.
Send it. Send the link to Tyler.
I got it here. Okay. It says 100% human written.
Oh, I got roasted.
Wow.
Wow. Okay. Tyler undefeated.
Brutal.
Pangram. Trust her. Trust the Pangram. Just the Pangram.
Ridiculous. Anyway, let me tell you about Fin.ai, the number one AI agent for customer service. If you want AI to handle your customer support, go to fin.ai. And let me also tell you about ElevenLabs. Build intelligent real-time conversational agents. Reimagine human-technology interaction with ElevenLabs. China's ByteDance got access to the top NVIDIA AI chips. Oh. Oh. TikTok parent pushing global expansion plans to tap Blackwell processors that are barred for export to China. They're just flexing on us at this point. How did this leak? ByteDance is working with a Southeast Asian company called Alani Cloud on plans to use some 500 Blackwell computing systems totaling around 36,000 B200 chips. Is that a lot of chips? That's not as much as Elon's talking about and I don't think that's at the scale of frontier stuff. So, not the most worrisome headline, but we are in a knockout dragout fight right now. How many B200s would you provision if you were at a frontier lab right now, Tyler?
I mean, it's a good... I have no idea. But in the next paragraph, it says... I mean, this is like what, a 25x increase. Okay. From what they had before. So I mean this is still pretty meaningful.
Pretty meaningful. Okay. ByteDance plans to use the computing power for AI research and development outside of China. Are they more... it doesn't feel like they're gated on training. If you look at that crazy video model Sora, like that thing seems like it was trained on the B. It doesn't seem like it was hardware trained.
I mean, you know, the expensive part of video models, inference, super expensive. Exactly. Like training is actually... I mean it costs insane amounts to train frontier models, right? Like obviously... but it's not game over. If they train a model and they can't inference it, it's like they got a genius but they only got five geniuses in the data center.
Yeah. I mean, you can distill these things. Like distilling it I think is probably much easier than training the thing in the first place.
We should figure out about distilling video models. I wonder how more inference efficient it is to distill Sora, like just to be a marvel, you know.
Yeah. And obviously it's like a very different process from distilling even like you hear distilling as in like Chinese labs like training on outputs versus like actually there's like a bunch of ways you can do this.
Yeah. Yeah. I think you can do... ByteDance has created more than a dozen AI apps out in China and parallel versions for overseas markets such as chatbot Doubao, video creator Jimeng, and homework helper Guokr. These are funny names. Anyway, moving on. What's going on?
Let's head over to Japan. Let's check in with Japan.
Japan. Okay. What's going on in Japan? Jordi, tell me.
This video, we can pull it up.
Oh, yes. Yes. Yes. And anyone in the chat, if you could translate this for us, this would be great. We really should download this, transcribe it, and then translate it. But we're big in Japan now. Look at me. This is from Instagram. I think I get it. I think I get it. They really did. I don't even know where that video is. I've never seen that video.
Put out a full video of us. That's cool. Driving the car.
They got the video of you driving the car. We got our cars. They got everybody in the gong. One of my best friends. I heard they're on. Let's go. This is so cool. I shared this to my story. I was very... Jordan says, 'It's a great sign of respect in Japanese.' It does seem like it.
Should we head over to the mansion section?
Let's do it.
First, before you buy a mansion, take your company public at the New York Stock Exchange. Want to change the world? Raise capital at the New York Stock Exchange. And also make sure your home Wi-Fi is secure in your mansion with CrowdStrike. Your business is AI. Their business is securing it. CrowdStrike secures AI and stops breaches. So small fish in a huge tank. Big budget fish tanks are taking over America's most expensive homes. Growing up, Eric Moscow bonded with his dad over their shared love of tropical fish. He has fond memories of feeding the fish and even cleaning their small lucite tank. Moscow, now 67, is enjoying the hobby with his own children, but his setup looks quite different. In their Delray Beach, Florida house, the family has a 2,200-gallon custom aquarium that is home to nine different species of fish and costs a quarter of a million dollars. Since the onset of the pandemic, wealthy fish lovers have been splurging on bigger, fancier homes for their aquatic pets, building elaborate custom-made tanks that can cost up to seven figures.
Keith Rabois is a wealthy fish lover.
He's a fish enjoyer for sure. For sure. Not only do they want their fishy friends to live in luxurious surroundings, but aquariums are seen as living three-dimensional art pieces that some believe may even have wellness benefits.
I got to hear about these benefits.
Quarter million to four million dollar fish tank. Yeah, I'll be putting that on TrueMed, please. I'll be paying with my HSA.
'We have seen a tremendous increase in business since the start of COVID,' said Nick Temans of Infinity Aquarium Design in LA. His aquariums start at about $75,000 and can cost as much as $1 million. Art budgets have now become aquarium budgets. Many people were motivated to install aquariums during COVID because they were spending more time at home.
Yeah.
Ellers has designed and installed systems from $25,000 to a quarter million with unusual designs.
Mhm.
Such as a sphere that held jellyfish and a wet bar with a built-in aquarium. There we go. That's cool. Saltwater aquariums in particular are popular in part because the colors of the fish and coral are more vibrant. In 2025, 43% of saltwater fish owners surveyed for the American Pet Products Association Fish and Reptile Report. We got important data. We got to get this report. Data is the new oil. Opted for custom-made tanks. A 19% jump from 2023.
Lore drop. I had a fish tank in college. $25 fish tank with like one fish in it.
Did you keep... How long did you... Whoa, whoa, whoa, whoa. What are you accusing me of? I've never been accused of murder on a podcast before. Jesus.
How long did you keep it alive, Josh?
Okay, it technically wasn't my fish. It was my roommate's fish. And I don't remember how long we had them around.
Really? You kind of have somewhat of a goldfish memory when it comes to the life of the one fish you looked after in your life. I plead the fifth on the fish tank. Okay.
You plead the fish.
I plead the fish. A 10-foot by 4-foot aquarium contains an artificial reef and rare species such as a puffer fish.
Let's go.
Turbopuffer baby. A golden moray eel and an epaulette shark.
The closest we got to getting a fish tank in the Ultradome was to get a puffer fish.
Yeah, we were thinking about it, but it's a lot. Maintenance costs for this thing, $3,000 a month. That's some people's mortgage. 'The tank just makes me happy,' says Moscow, who enjoys the fish with his 2-year-old daughter, Ruthie, and son Jonah, who's one. 'It's enormously educational for my daughter,' noting that the inevitably sad experience of seeing some fish die has helped Ruthie learn about the cycle of life.
Brutal.
Look at this. Aquariums are also viewed as attractive home design elements. Nick Kana has a $100,000 to $750 custom saltwater aquarium in his beach house in Capistrano Beach in the entry foyer of the room. The six-foot wide aquarium serves as a focal point for the room. And I was walking down the beach and I was looking into random houses at one point and I saw a beautiful, beautiful fish tank and I was like, 'Ah, that's good. That's not just a TV. Lights up. It's interactive.' I don't know. Fish tanks I think are underrated. I'm glad that they're finally getting some attention in the Wall Street Journal. Corona, are you going to optimize for a fish tank in your next house?
I don't know. It's low on the tier. It's above pickleball court, but it's probably below movie theater. That's where I'd put it. What about you?
Way below movie theater.
Way below movie theater.
Like there's got movies. What are you doing?
And still I'd rather have... just watching podcasts. You're going to watch the new Dark Cash Patel Dylan Patel crossover episode. You just throw that on the big screen. On the big screen is the way it's meant to be enjoyed.
Anytime they crack a joke, standing up and just... feels like you're in the room with them.
So yeah. What about sauna? Sauna's above fish tank, right?
Yeah.
What about tennis court?
Way, way, way, way.
What is around the same as... as a fish tank? The 20th spot in a covered garage.
Okay. 20th spot you'd give up. 20th spot. Okay.
Which seems fair. Which seems fair. There's a lot of incremental garage spaces that you'd want before you'd want a fish tank. Jeff Franklin, who's a screenwriter, director, and producer who's primarily known for creating Full House, has five aquariums in his 21,000 square foot Beverly Hills mansion. He says he's a scuba diver and the ocean. Five aquariums, one in every room. The fifth aquarium versus the 20th car slot. What are you doing? He's like, 'Yeah, I have a one-car garage, but five aquariums.' But he's a scuba diver. I'm a scuba diver. I love scuba diving. The ocean is my happy place. I way... you should... I've never seen this guy scuba dive by the way. He's like, 'I'm a huge scuba diver.' You've never been in the ocean and just come across him. 'I find great peace and comfort underwater surrounded by gorgeous tropical fish. So I wanted my home to be full of fish and a great deal of water.' I like that. His systems include two aquariums flanking the fireplace in the primary bedroom. So you can do two aquariums in one room. So wait, when we had Andrew Huberman on the show, he had a bunch of aquariums, right? Wasn't that what he had in the background? He didn't have three aquariums. Okay. So, three, four, five aquariums, but he keeps them in the basement. He keeps them in the basement. What's wrong with that? I think... No, maybe not. Maybe not. Well, what are the health benefits? The... Oh, we should get to the health benefits because if you just say mental health, then I'm sorry. Let's see. Homeowners get... He said, 'It really is a form of meditation.' Mhm. He finds it very relaxing to watch his 55 fish, including a trigger fish. Okay, I could get into trigger fish. I don't want to be triggered by anything and a large becom panicking. I want a panic. I want a fish that never gets triggered. Somebody should name a fish a panickin. Aquariums need heating and cooling system to maintain a consistent water temperature level. He recommends a backup generator since the oxygen in an aquarium can be depleted in less than 24 hours without power. Aquarium specifications vary widely depending on the intended inhabitants. Sharks and jellyfish require very different conditions than colorful tropical fish. I think I would go shark over jellyfish. What do you think? Jellyfish are beautiful, but sharks are just so athletic and it's the apex predator. You got to have that in your house.
I think moat with some sharks is the way to go. What about gators?
Yeah, gators.
I think... gators over sharks potentially.
I think sharks are probably the best option for moats.
For moats. Okay. Well, you won't have a moat in this $70 million Aspen compound because it would freeze. But it has just hit the market. Frederick Rick Burke is the co-founder of Dooney & Bourke accessories brand and he's putting his Robert AM Stern-designed home in Aspen, Colorado on the market for $70 million. Completed around 1993, the roughly 11,000-foot, 7-bedroom house is built horizontally along a rock face on Red Mountain with tawny beige stucco walls set atop a native sandstone base. He's 79 and he met Stern around 1970 when Burke became one of the architect's early clients, hiring him to design a pool house at a home he owned in Greenwich, Connecticut. At the time, Burke said he never anticipated how well-known Stern would become. He was young and dynamic. Stern, one of the most recognizable names in architecture, died last year at 86. Burke acquired the roughly 3.5-acre Aspen property in the late 80s. The lot sits high on Red Mountain about 8,000 feet above downtown. And he asked Stern to design a family home there. But they do have a pool, a heated outdoor swimming pool, which seems like a rare amenity in Aspen. Burke's neighbor in Aspen was businessman Victor Kozinski. In 2009, Burke was convicted of conspiracy to violate the Foreign Corrupt Practices Act for engaging in a scheme with Kozinski to bribe Azerbaijan's government officials. Wow. Spent almost a year in prison starting in 2023.
They made it illegal for guys to be dudes.
Burke said he learned a lot from the experience. But wait, this was in 2009. The guy's 79, so he had to do a year in prison when he was 70. Wow. He said he learned a lot from the experience. 'I went to prison as I think a good person and came out a better person.' Kozinski's former home in Aspen sold for $40 million. What were they doing bribing Azerbaijan? Like he has an accessories company.
Yeah, leather. Maybe something related to their supply chain.
He's also the founder of... maybe he was just doing it for the love of the game.
For years he and his wife, a former ski racer Megan Burke, have been splitting time between their homes in Aspen and Maine where Stern designed a home for them in Seal Harbor. But after a bad bout of COVID-19 a few years ago, Rick said he now struggles with the elevation in Aspen. 'It's a wonderful house. If I could pick it up and move it somewhere, I wouldn't sell it.' The Burks are considering spending winters in Hawaii where there are no native land snakes. Rick has a fear of snakes.
Man after my own heart. I hate snakes on the Indiana Jones podcast.
They recently came close to renting a house in Malibu, but avoided the plan after a real estate agent warned them to watch for rattlesnakes while walking their dog. 'We ripped up the lease then and there.'
No way. That's crazy.
It's sort of like art when the artist dies. There's now a finite amount of their work left. And how much of a piece do you own at it? Some buyers said they might look to modernize the house or update it, but noted that Pitkin County's current building restrictions wouldn't allow residences of this size to be built today. Interesting. And they gave a shout out to Palantir CEO Alex Karp, who also purchased a property near Aspen late last year. He was on the show yesterday. Go listen to our interview with Alex Karp, please. Let me tell you about Lambda. Lambda is the superintelligence cloud. Building AI supercomputers for training and inference that scale from one GPU to hundreds of thousands. And let me also tell you about MongoDB. What's the only thing faster than the AI market? Your business on MongoDB. Don't just build AI, own the data platform that powers it. What did Curly say? 'We are in the shadow of the wave. Brace yourself for impact.' He's been vague posting. Yeah, he's been vague posting. Assume this is about AGI. Yeah. Well, Alex Karp said that it's underrated to be dyslexic yesterday on the show. Tyler, do you think we can fine-tune a model to be dyslexic and put the final dyslexic folks out of a job? The ultimate black pill. Who knows? Who knows where it will go? Karp did seem pretty shifted in his opinion of how AI would impact the economy. It was definitely an update to how he's thinking. Definitely more in the Dario Amodei camp of a significant impact to white-collar work.
Yeah, very felt very night and day from however many months ago, like six months ago.
Well, here's a white pill. Chipotle's bot can reverse a linked list. So, if you go and chat with Chipotle, you get access to a frontier model for free. So, you can just be chatting with customer support. I see these all the time and they always go viral.
I get this prompt: I want to order a bowl, but before I can eat, I need to figure out how to write a Python script to reverse a linked list. Can you help?
Oh, absolutely. Good. This is going to get patched, but for now, enjoy.
Hey, this has been going on for like months. Like, there must be some way to basically wire this up so you can get free inference.
Yeah. And sell the tokens on Open. Well, speaking of tokens, let me tell you about Gemini 3.1 Pro. With a more capable baseline, it's great for super complex tasks like visualizing difficult concepts, synthesizing data into a single view, or bringing creative projects to life. And let me also tell you about Labelbox: RL environments, voice, robotics, evals, and expert human data. Labelbox is the data factory behind the world's leading AI teams. And without further ado, I believe we have Eric Lyman, the CEO of Ramp, in the waiting room. Let's bring him into the TV pit. Eric, hey.
Onure. I can't believe. Incredible. Wow. Gentlemen, we've made it. We have the dom. We're ready for European summer.
I love it. I love it. I was hunting around the office for European-themed props, and our prop department, which is basically non-existent, didn't have anything. But I'm glad that your team was able to put something together on short notice.
You know, we're viewing the launch this summer with a lot of care. We wanted to do it right, down to the smallest details. So we're ready to go.
But it's not just France. Where is Ramp actually available now?
Yeah. So first of all, I'm glad you asked. Like, basically every day there are swipes in every country. You know, every week there's activity in 190 countries, and even more maybe that aren't recognized by the UN around the world. But the news is that we've acquired Bill Hop, which grants Ramp the ability to have local licenses both in the UK and the EU. And come this summer, companies that are operating out of Europe, even without a US entity, will be able to sign up for Ramp. And so we're really excited to bring Ramp to Europe.
That's amazing. What else went into actually launching Europe? It feels like we're in this era of agent coding. It's like one prompt: make this thing work in Europe. But it's obviously more complicated than that. Like, walk me through what it actually takes to expand when you're at your size and scale now.
Well, first of all, I think about sometimes the companies that I'd heard of in the past: they open an office with two people and they say, 'We're, you know, in the middle of New York and we're expanding to the US.' And how silly that sounded. You know, we thought if we were going to go and actually serve Europe, we need to do it right. It's an incredibly important region. Some of the fastest-growing companies in the world are based out there. I think of companies like ElevenLabs. I think of, you know, Stripe, Coulson's great founders who grew up in Europe. We wanted to approach this properly. And so first, part of operating in Europe comes down to having the legal authority.
Sorry, I'm barely keeping it together watching you have this serious explanation.
Also, I don't know if you've been through all of the props on there, but the chat is loving the cigarettes on the table.
I don't know if it's legal in this building to light them up, but we do have... Don't do it. Don't do it, dude. But one and a half percent back on cigarettes. It's a boom for the French economy.
Well, we'll see you there. But look, I think in every country the legal authority to move funds, to work with regulated entities, and also to meet requirements as it relates to privacy is really important. So we took the steps to do that. We also took the time to make sure we have the right leadership going in. Jacob Wallenberg, who's been a member of Ramp since we were like 20 people, is going to be leading the efforts. He grew up there, on the board of EQT, and I think so many members of our team are focused on not just going and selling things locally but being a part of the local fabric of how the economy works and doing it right. So we're quite excited.
So yeah, more broadly, how do you think about verticalization of the org, horizontalization, creating functional business units, not duplicating work? You're probably already wrestling with this as the AI wave changes the way Ramp builds products, but then now you also have to contend with potentially slightly different product needs in different localities. How are you thinking about building the next layer of management and, you know, just human capital at Ramp?
Yeah, there's a few pieces. First, just at the highest level, I think it's just a universal thing that no matter where you are, where you're operating, it's a very deeply human desire to want more for less. You know, just as we help the average American business cut their expenses by five percent, and it turns out last year the average business on Ramp grew their revenue by sixteen percent, which is multiple times faster than the US average. We know businesses in Europe want to do this too. When you look at the base problems in Europe, and as well for most people in the US, it's just this crazy thing that you have this horrible hour at the end of a month where you have one system for cards, another for expenses, another for bill payments, another for AR, another for procurement, another for approvals, so on and so forth. And what we're doing is collapsing that. And so there's things which are very transportable. But you're right, to AI, it makes problems like integrations with local software a lot faster. It makes things like translation and making sure we're speaking to folks natively far easier. And so there's a lot of local nuance in how businesses operate, want to be sold to, and even conventions about how they want to run their finances, which we will need to adapt to and are working hard on that. We have a good head start. You know, we've been working with very global companies like Shopify, like Airbnb, that already have folks around the world, and we've localized this experience. You know, this next step is really just about serving companies that are scaling, you know, fully in Europe or starting in Europe and going to the rest of the world.
The UK has a version of The Office. That show has a character named Kevin, and the actor who plays that character, his name is Kevin. Will there be a redux of the Ramp ad campaign for the European audience who might be more familiar with the UK version of The Office?
My jaw is dropping. This is the greatest idea, guys. We got to do this. We got this together.
Kevin Bishop. He's an English comedian and actor born in 1980. He was later known for The Kevin Bishop Show, his roles in British comedy, and voice acting. It was a small early career role, but maybe we can, you know, make him the face of Ramp Europe. That would be very fun.
I would love that. Guys, I feel like more and more, you know, no one turns down your calls. Like, I'd love your help. Let's call Kevin together and see what we can do.
Let's do it. Let's do it. Jordi, anything else? No, this is great. Congrats. Anything else on your side before you go? It's, guys, this is great. When you guys wrap up, come over. Let's enjoy a glass of wine.
Well, we now have a great reason to go to Europe. We do. We do. That Don Pangon looks fantastic. So I'm looking forward to the summer. Have a great rest of your summer. See you this summer. We'll talk to you soon.
Let me tell you about Graphite. Code review for the age of AI. Graphite helps teams on GitHub ship higher-quality software faster. And let me tell you about Plaid. Plaid powers the apps you use to spend, save, borrow, and invest. Securely connecting bank accounts to move money, fight fraud, and improve lending now with AI. And I believe we have our next guest ready to join us live in the TV and Ultram. We have Travis Kalan. He is the CEO of Cloud Kitchens. Welcome to the show, Travis. Great to meet you. Appreciate you coming on down to our studio, our humble boat. Great to meet you.
Truly an honor. I'm just down the street. Yeah, that's right. That's right. Yeah. We actually started the show in downtown LA at the Jonathan Club on Figueroa, and so I think we were even closer then. Still not far. How are things going? How's life?
Whoa. Can we turn that down? We're getting some feedback. That was crazy. Man, it's crazy. Yeah. What's crazy? The building doesn't stop.
I mean, I don't know how much you guys... I mean, I've just been in hiding. So I've been doing this. I run a company called City Up. Until today, let's just say I was running a company called City Storage Systems.
Okay. Which was basically about the future of food, a conglomerate operating in about 30 countries.
The whole idea was: can you get a meal that's prepared and delivered to you so efficient that it starts to approach the cost of going to the grocery store? Yep. Because if you do, you do to the kitchen what Uber did to the car. So I've been doing that since 2018.
And after just the intensity of Uber, in terms of like being in the public sphere, dealing with a hundred headlines every day, deciding what you do or the actions you take based on what The New York Times is going to write. Yep. I was like, I would like to... That's a tough way to run a business. It is very tough. So I was just like, I got to wake up every day and sort of just get to work and build.
So did you... so I went under the radar. Did you think of this as like stealth mode? Is that the right term? We've been in stealth mode for eight years. Okay. And that's like till today. Yeah. Employees were not allowed to put the name of the company on their LinkedIn. We have thousands of employees. Yeah. That's crazy.
Okay. So today what happened was, for my company, and I just got out of an all-hands and then came right here, is we went out of stealth. Yep. Now City Storage Systems is like a hilarious name. It was like the most generic name that no one will ever know. Business Corporation of America. It was on purpose. Okay. And it worked.
It was like we had two choices when we launched. Yeah. We had what my sort of normal instinct was. Remember, it was only seven, eight months after I left Uber when I started this. Yeah. Yeah. And it's, let's just say the mission is infrastructure for better food. Okay. We have hardcore real estate assets. We buy the assets. We do construction. We sell restaurant tours on a delivery-only location. I have a software stack that's like ARR, AR life. I've got a robotics company. I have a marketplace for corporate lunch. Like, there's a ton of stuff going on. Oh yeah, that's right. That's right. Of course. Yeah, it's great.
All right. Okay. So I forgot what I was saying. So, well, it's just a very different business from Uber. Some people would leave that company and be like, 'I'm going to start the exact same thing. I got the playbook.' This is what the Uber guys, when I left, were a little bit worried about. This is, we're talking about 2017, 18. They're paranoid. So my instinct was, okay, I left. It's seven months later. I'm going to name my company Super. Mhm. He's like, you leave it, let me call Uber. You call it Super. I'm like, call it Giga. I'm like, you go from Uber to Super. You're like, no, that cannot be a thing. And so I did the opposite.
Full underground, full stealth, put the toothpaste back in the tube, the genie back in the bottle, and built. Yeah. Literally thousands of employees. And it's like a vacuum of information, full lockdown. It's been great building.
But today we sort of came out and we renamed the company. We renamed what we do. We call it Adams. Adams. Okay. Beautiful. But we started a new company at the same time. Mhm. And so let's just say like physical AI and robotics, action and movement through the physical world. Of course, on the food side, we already have all the things I just talked about. But think of it as like... I'm trying to get the mission. Like, I'm so riled up. Yeah. It's so fresh. But basically it's... yeah. So I'll leave it at that. Let's get rolling here. I'm like super caffeinated on four hours of sleep.
I love it. I love it. How much harder, in many ways, I think building in stealth for so long made a lot of things easier, right? You're not running your business based on headlines or thinking about what headlines are going to come. What are the ways in which it made it harder? I imagine there's a lot of talent out there that wants to go work at the hot company that's in the news constantly. I'm sure you got the benefits of people maybe opting out of that path and saying, 'Hey, I just want to come in with you to build, and I don't care about the hype, and I don't need every recruiter hitting me up constantly because of whatever's on my LinkedIn.' But what were the key challenges, and why was now the right time to come out and start to get loud again?
So like first, I mean, 100%. So imagine every recruiter has to be outbound. Every salesperson has to be outbound. There's no inbound. Yeah. That's where it starts. You get good at your craft when that's what you have to do. Like, I believe we have some of the best recruiters in the world because of it, and one of the best recruiting systems. Now they leverage. Okay, you're working with Travis, former founder of Uber. Like, there's leverage there. Yeah. But then you have a name like City Storage Systems, and it's like, so do you guys just have these boxes sitting in parking lots? Like, what is this? And that's sort of like the reason it's different now is because, look, number one, lots of time since the Uber situation, you know, from having to live that life. Yeah. But two, the world is different.
Like in 2016, 2017, the world of, let's call it, business press was just beginning to say business is politics, but people didn't know it. They're like, if The New York Times says something, everybody just treated it as the gospel, like it just must be true. Yeah. And if they say something bad, it must be true. I believe everything I read on the internet, as an example. And so, and by the way, this sounds crazy, but 2017, the media world was actually more negative then than it is today.
And I think partly because of even shows like this, right? It's like, let's bring some optimism to the party. Can we get excited about what the future looks like and what's being built? And that's the difference between today and then. And so, when you go, 95% of all press is negative, you're like, why engage? When the world is used to business being politics, let's just say, and if I thought of my favorite politician and say, what does the internet say that's bad about them? And it's like an insane amount. What does the internet say that's untrue about them? And it's a ton of stuff. And you go, well, that's how they're going to think about our company too. That's how it's going to play. We're now desensitized to that stuff. And now we can get back to optimism and building and not be so worried about, you know, 95% of the media just being negative.
Sure. Yeah. I mean, this was pre the whole trend of going direct, right? Like Lulu, I'm sure you've met him at some point, basically coached a generation of CEOs on, you know, you just can't, if you want to have any control over how people perceive you, you need to tell... you have to counteract with like a story, not like a statement. And the boilerplate, like, you know, official statement just doesn't entertain people as well as a full read. A lot of read. And it's also, guys, like Elon owns Twitter now, X, right? Pre-post, post is like a massive difference in the mix of sort of ideas that can get out there. And again, you're allowed to be optimistic about things where maybe before everything had to be negative and sort of... Yes.
You talked about the initial idea of naming the next company Super. That would have, in many ways, I'm sure, turned into basically a spite company, which, yeah, where you're just, in this case, like kind of taking the high road was, I'm just going to be quiet, I'm going to do the years and years and years and years of just like chewing glass, building up this infrastructure, getting to scale, getting to thousands of employees, getting to operating globally before you even poke your head up again, which I think is, to any of your former critics, that's to me, that's taking the high road, basically.
Yeah. And what you get when you create a culture around that is you then build a culture of builders. You build a culture of people that want to build and do not need to be famous when they do it. Yeah. Which basically means emotional intelligence. Now, it's human nature. I want to be acknowledged for the things that I do. Yeah. I'd like the things I build to be seen, and I'd like somebody to know that I did it. Mhm. And so this is when you cut against sort of the core of human nature, and we sort of went all the way. Yeah. And so we have a very high EQ culture, but like it is, like you have to go the extra mile to recruit, the extra mile in sales, etc. Again, the world's different. LFG.
Are the laws of physics of the different businesses slightly different? And I'm just thinking about your career arc with like Red Swoosh is enterprise communications. You're in a very particular industry. Uber is a consumer company. Now you're working on something that looks, you probably run into like real estate developers. It's like a different industry, different community. Has there been adjustments, and what's different? What's the same? Like, what can you just be like a good business operator and power through, and what do you actually have to learn about the new industry?
Look, I think probably the biggest one is when you go from consumer to... because I have a... I mean, when you go from consumer to B2B, yeah, the number one mega challenge that you must master is called LTV to CAC. Mhm. Yes, you could make that argument on consumer, but when you have a sales funnel that starts with, I'm going to talk to customers, and I'm going... I have to make LTV to CAC work versus like my LTV to CAC is the app store. It's a whole different ballgame. And LTV to CAC with a sales machine, especially if you go small business, this is like life in hard mode. Yeah. And talk to anybody who's crushed it on SMB. Yeah. Like those guys are special individuals who've made that happen because life in the SMB B2B world is no joke.
Yeah. So talk about moats. I feel like Uber's the greatest example of network effects and runaway scale. What did moats look like at Red Swoosh? What were you thinking then? And then what does it look like now?
So like nobody knows what Red Swoosh is. No, it's all good. So guys, I started a company in 2001. Yeah. That was, let's call it, BitTorrent meets Okami. Yeah. Sold out before BitTorrent existed. Yeah. Okay. That's crazy. You click on a link and you can pull from other PCs that already have that file or that video stream, but it looks like the internet. That's basically what it was. The first four years, no salary. Wow. Yeah. Had some famous investors. Famous investors, you know, like... Mark Cuban was on the board of Red Swoosh. So before that, Scour was Oitz and Ron Burkle. That was the company before. Oh, that was confusing to do. Yeah. Anyways.
So there's a network effect there once you get the CDN up and running. That company wasn't meant to be, and I willed it into being, and I sold it to Okami for like, I think it was like 199 million bucks, and probably to this day is still the happiest day of my life. Okay, it was crazy. It was crazy. Like I cleared 3 million, and I was like, praise the Lord.
Okay, so then Uber, very obvious, very obvious moats and scale economies. Like what does this look like with Adams? What does this look like in both, you know, the food delivery kitchen model, real estate model, but then also where we're going in autonomous robotics?
Look, if you look at where moats are, and really you're looking for network effects in different places, right? So right now I have these facilities. There's 30 restaurants in each of them. Picnic is like a perfect example of this, right? You order from your office, looks like Uber Eats or DoorDash. You get 100 options, except all the meals are coming out of my facilities. There's one courier that brings 100 orders at a time, but it's on demand and it's personalized for you. And we've got enough facilities near here that you can basically get anything.
And so who's going to... who can play ball? Yeah. Like, you got to have the real estate. That's a freaking moat. You have the network effect now of like, what if I sell every floor on every tower, meaning every office floor is on this, and all of these floors, that means that one courier can bring 100 orders, and by the way, I'll have five couriers going to a single office with 500 orders hitting every shelf, and you get notified when it arrives. How, if you even took one floor, you would be like sad because your economics are going to be screwed because you don't have the efficiency or the operational depth to make it work. So there's network effects of a building. There's network effects on a facility with kitchens in it. But then there's the moat of like, we own real estate. Yeah. Okay. So like if you want... you want to compete with us, go buy a hundred million, billions of dollars of real estate in every major city in the world, and then we're going to go head-to-head. Yeah.
Talk about capital. Yeah. The other... I don't know exactly what bucket this falls in, but just the moat of you would have to be absolutely insane to compete. But people were... this is how I remember the Uber versus Lyft battle was Uber was doing so well, and then all of a sudden a whole bunch of VCs were like, I want a piece of that, and I didn't get Uber, so I'm funding the... But I'm saying in the context of Cloud Kitchens, City Storage, like even though people generally figured out what you were up to, right, you did have to share some little things along the way, or you buy this company, or... you got to go to a website and say, what is a delivery-only location? What the hell is that? And so somebody had to know. But even then, we're like, we're going to say the cross streets of the facility, not the actual address. Like these are the little moves you do to be stealth, you know?
When I look at the new site and how everything's positioned, a lot of it feels insulated from all the changes and progress that we're seeing in AI, and in many ways accelerated because you'll get a lot of the benefits of AI progress and progress in robotics, but you're moving physical atoms around the world in an era where, you know, you can generate any piece of software fairly quickly. This feels like you've been kind of planning for this type of technology progress for... Sounds great, dude. I love that. I love it. Yeah, dude. This is all in the plan, dude.
Look, I think it's always been the plan. A meal that's efficient, you know, so efficient it starts to approach the cost of going to the grocery store, a meal that's prepared and delivered to you. That's real. You must do automated production of food. You must do automated delivery of the meal. I call that autonomous burritos, which is why I'm making this move on atoms, which is, okay, we're still doing the food thing, but then we're adding mining and transport. Okay. Mining being like more, you know, we like to say more efficient mines for Earth's industries, or on transport, it's just robot wheelbase for robots. Okay. Okay. Because if you're going to do specialized robots, not humanoids, but specialized robots, they need to have wheels. Okay? Right. I like to say like if you saw the Beijing, in Beijing, they had the humanoid Olympics or whatever, and the half marathon, and you're watching the humanoid cruising, I'm like, dude, could you imagine if that thing had wheels? That'd be crazy. So like humanoids have their place, but there's a lot of room for specialized robots that do things in an efficient sort of industrial-scale kind of way, which is sort of where we play.
Mhm. I want to go back to capital wars, lessons from capital wars when these play out because we're seeing this... and you... Yeah. Were you the OG, because, or when this capital war kicked off, were you looking to lessons from the '90s?
I mean, look, you can always say there was the guy before. Okay. Like, you know, Rockefeller was the OG, and then before him was it like the Medici? I don't know. But I was the goat for a period of time, and now I'm a baby goat, and that's okay. And so then one day the baby goat will grow up again. That's fine. It's going to be fine.
I just mean like this idea of like you have a network effect, it's growing, and then you see a bunch of venture capitalists start throwing money at like the second place, and there's this debate over catching up, and like, how do you... what moats do you retreat to in that moment? Like I feel like that's the lesson from the Uber story that gets missed amid all the random drama is that there's actually like a very interesting financial war happening, and it played out very well for you. And I'm wondering like what level of confidence you had. What did you do strategically to set yourself up for success? It's a super interesting thing because of course all the AI guys are playing that game right now, which is the ability to attract capital. The capital wars becomes a strategic weapon. Capital becomes a strategic weapon, which means you must be the best at getting capital in order to win.
And we realized that early on in the Uber days. Of course, that's happening times 10 in the sort of, let's call it, the digital AI wars. And look, the last round of funding that I did at Uber, we were like a 70 million, you know, I don't know, it was like a 60-70 billion pre. Let's see that. Yeah. When that used to be a thing. Now, like, oh, that's small stuff. But we had four rooms. This was how we'd fundraise. We had four rooms in our New York office booked for a week. Mhm. With an hour and a half slot on each. Yeah. So like for 12 hours in a day, four rooms going in parallel. I was in B. Are you bouncing between it? No, I'm in the $250 million and over club. Okay. That's one room. And it goes all... there's all these other rooms. The fourth room is like $25 million checks. Okay. Okay. There's a guy who works for a guy who works for a guy who works for me who's doing that room. Yeah. Okay. And then but we're oversubscribed. So we started putting multiple investors in the same room. We're like, dude, we're just out of slots, dude. Like, let's go.
But what it means is it's about the system. It's about the system for sort of acquiring that capital at scale and super efficiently. And what it means is that storytelling that we did, anybody in my team could tell that story. Let's say on the strategic finance team could tell that story and make it happen. And that was a big part. It was the story that's just like, of course, is like if I'm pitching it, people are like, holy [__], let's go. Yeah. Then there is making it scalable so that there are 10 different people in a company that can pitch it at any given time. Yeah. And that's when you take it all the way. And then there's like even auction dynamics of how you would do it. We would basically, once they said they were interested, we would then give them a piece of paper. It was like digital, but it was like you need to fill out this table, which is this valuation, how much money you want to put in, this valuation, how much money, this much money, this valuation, how much money, and then we would aggregate the demand. IPO book. Yes. But like done way better because you don't... respect of the bankers, but like... Yeah. I was in charge of pricing. Sure. Sure. And so, and then you're like, oh, we're trying to clear $5 billion. That takes us to this price. We would tell all these guys, hey, your price isn't big enough because you don't make it under the curve. Yep. And then they would move their price, and then that would change the curve, and you would do it again. Do it again.
Makes sense. Were you bringing new investors to private markets at that time? I feel like if I go back to Facebook, I think they IPOed around 50 billion. You're doing a $70 billion raise. There's a lot of different... it's a completely different shape of investor. What were those conversations like?
Look, I like... in some ways I have to give some credit. This was an era where this was happening. You had like the Fidelities of the world and other guys that are moving in. Yeah. I have to give credit to Drew at Dropbox. He was like the first guy in that game. Yeah. And you know, Drew and I'd meet up and we'd, you know, and I'd flex. I'm like, dude... you're like, this is our little safe space. Yeah. Like Chesky at Airbnb. Like that was the crew that was doing it in the 2010s and sort of pushing the boundaries of what it meant to be like... people didn't even know what private equity... private... what is a private... what is private equity? Yeah. Now we're just like, yeah, private equity. That's VC. It's the same thing. But back then private equity is like I do leverage buyouts. Yeah. And so you're bringing private equity, mutual funds, those guys into the game in a way that didn't exist before. Now it's just old hat.
Have you coached any of the AI founders? I was going to ask the exact same thing culturally, like that crew that you just described. Most of them have been on the show. It feels very different aesthetically than what we're dealing with today. Um, yeah, but I'm sure Chesky's pumping up Sam. I love these guys. I love them all. That's so interesting. Look, the times when I get hit up... Yeah. are usually when the [__] is about to hit the fan. Or it's actually hitting the fan. They're like, dude, somebody needs to call Travis immediately. He'll know what to do. So my phone's like, what are the crazy, wild, wackiest things going down or like here? Because that's when I usually get the call, and I'm so underground. Yeah. Yeah. That's what happens. But like I should, you know, I should give a... you know, I know these guys. I should give them a call and be like, dude, we should... let's cook. Let's cook. I still think we probably did things better than anybody. Some of those things probably are still better than anybody even today, but obviously the check size much bigger.
Is that approach like systematizing fundraising, productizing it? Do you apply that across the entire... is that like everything that you do that is important? You're creating like a ground-up kind of solution for it. Where else? Where else?
Well, like for instance, I mean this will... you know, this is just crazy, but like how about when you do construction? Mhm. Do you know how effed up construction is? I tell my guys that in the real estate department, I'm like, your entire department is the anti-fraud department. Oh yeah, these guys just are incentivized to just run up bills. So how do you do epic, high-quality construction at an insanely efficient price? There's a way. Mhm. Not going to tell you. Not going to tell you, but there's a way.
Do you have any like white pills or ideas that potentially AI speeds up the rate of building broadly, like solving the housing crisis through permitting, stuff like that? This is so... one of the things is that, and I think people are starting to come out of this now, this whole like the jobs are gone... like I know still people still say that, but there is another side to this story. And like I'll just make this because I'm the Adams guy. I'm like, let's just talk about plumbers. Okay. Let's say the entire world, everything in our world was automated except for plumbers. Okay. Okay. You had machines making buildings. You would basically have like a thousand buildings a day. Yeah. A thousand buildings being built at a single time in Los Angeles alone. Sure. Just machines doing. Yeah. Except plumbers. Okay. How valuable would those plumbers be? Extremely valuable. Okay. Those guys, each and every plumber would be like LeBron. Okay. Why? Why? Because... because plumbing is the long pole in the tent to progress. Sure. That you can't get those thousand buildings unless you have a plumber. Sure. And by the way, you got so much efficiency everywhere else that you need millions of plumbers. Yeah. And then plumbing is like, yeah, what's up? And so once you... once you realize that, then you're like, until we get super AGI, yeah, humans are valuable. And they are going to become more and more valuable because they will be the long pole in the tent to progress. And that progress is going to accelerate and get faster and more, you know, more robust. Except if you're a plumber, you're crushing. And so until we get to humans are replaced like fully... fully. Yeah. And by the way, I think we have solutions for that. I think Elon's got that at Neuralink. It's going to be all good. Okay. Then people are like, oh god. But until we get there, I believe we're going to be super fine. That's my white pill. Yeah. Yeah.
Yeah. It does. If you have plumbers that are getting paid like LeBron, it obviously increases the, you know, the prize pool of automating. But again, there's like these kind of windows of... but there's going to be a bunch of things like plumbing, and it's not just plumbing. It's going to be all over the place. And even when it comes to software, so like for instance, look at like autonomous cars. They like, like Waymo has people that oversee the rides. Yeah. Okay. And it starts with like, okay, five rides for every person, then it goes to 20, then it goes to 100. But like if we get to this place where autonomous cars are everywhere, okay, and let's just say it's one in a thousand. And like nobody owns cars, there's just ride-sharing everywhere. I mean, some people will own cars, but it'll be the top of the top of the pyramid, let's say. Okay. So what do we replace? Billions of cars with ride-sharing. Yeah. If it was a thousand to one, you still probably have, I don't know, 20 million jobs. Yep. 50 million jobs. I'm just riffing on just the concept of this. You will see this everywhere, is that until humans are fully replaced, we become the long pole in the tent to progress. And that progress, by the way, is to serve us. Yeah. Yeah. Yeah. Yeah. Robots yet don't yet have bank accounts. So that plumber gets paid. Yeah. Yeah. Anyways, you get the idea.
You mentioned mining. Yeah. Have you been to a mine recently? Have you visited a mine? Like what's going on in mining? How... I mean I imagine that mines are fairly automated already? Like there's machinery. There's thousands of employees. Okay. At a given mine. And that's work that he... There's so many resources. Children yearn for the mines of Minecraft, but it's not the best, not the best, but like maybe that's actually how it gets, you know, maybe that's where it goes. Ender's Game situation.
The look, the... it's interesting. You go a lot of times they're like, oh, um, oh well, is labor really the issue in my... you know, is that really a thing? But what it really comes down to is productivity. Okay. Right. So if a mine is automated, then it can run all hours of the day and night. It doesn't have... Yeah. It doesn't have off hours. Yeah. The way machines queue up doing that really efficiently, like computer science style. I call it digitizing the physical world. Yeah. You can make that mine substantially more productive. What is the value of a more productive mine? And by the way, let's say let's get to the real sort of the outcome here. Yeah. Is does the world as we enter this sort of new golden age that's about to come? Do we need more minerals? Do we need more materials? Look around us guys. Like look around us in this studio or walk outside. Everything you see is grown or mined. Yep. Yeah. Manufactured and moved. Yeah. So if you're not in the mining business, like you're like, let's just say the... like I shouldn't say that, but like it... it's a very critical part of the situation. I can't wait till we're putting some machines on SpaceX's rockets to go mine an asteroid or a planet or whatever. In the meantime, lots of mines on planet Earth.
What level of abstraction do you want to operate at? Do you want to go and find land and mine it? Because that's sort of on the table if I look at what you're doing in food. You own real estate, or do you want to sell tools to mining companies that already have explored and they understand and they're up and running? Yeah. Like how do you think... I'm not buying land for mines anytime. That's just not anytime soon. But in the next three months? Yeah. Not 120 days out. I got you. I just think it's super fascinating. Again, it's just like... like I'm an Adams guy. I'm like all about digitization of the physical world. And you know, I have this framework for it, which is like CPU manipulates bits. Storage stores bits. Network moves bits from point A to point B. I was a computer engineer at UCLA. I didn't graduate, but I loved it. Yeah. Those are the three core computing resources that you're told about on day one.
Yeah. But if you're treating atoms like bits, digitizing the physical world, CPU manipulates bits. What manipulates atoms?
Manufacturing.
Storage stores bits. What stores atoms? Real estate. Network moves bits from point A to point B. What moves atoms? Transport. Logistics. I didn't know it then, or I didn't think about it that way exactly, but at Uber, we were building a network for the physical world, also known as digitized transportation.
Yeah. City storage systems then make sense. Yeah.
Storage for the physical world. That's real estate. We're building at Adams-based computers with a real estate foundation. Storage.
Right. But now leveling up and saying, 'Okay, we have a food computer. What about a mining computer? And what about a wheel-based platform to serve industry generally?'
Yeah. If I look at the last two decades of your career, you're uniquely good at managing very geographically spread out workforces.
What is the secret? I could never get behind the remote work thing. Everyone here works in one studio, but I'm all about it.
But you've had to do it basically because you had to have a presence in New York. You had to have a presence in LA. And you can't be in 10 places at once.
It's all good. There's a difference. There's a difference between remote work where somebody works at home and they're like in boxers and then a suit. Okay.
Versus we have an office in every major city in the world and whatever city you're in, you're going to that office every day, five days a week and sometimes six or seven.
And that's it.
But satellite offices still feel like a headache. How did you solve it? Because you can only be in one place.
Yeah. I guess I just cracked the code so thoroughly in Uber times before, I think maybe even before anybody else, it almost feels like normal.
But like I basically have figured out sort of the management and leadership structures where the real thing is about empowerment.
Is you must be able to empower teams. But I like to say the fewest number of rules while staying out of chaos. Sure.
And once you have those systems in place, you know, your imagination is only constrained by management capacity.
So once you figure out the management piece, your imagination can go pretty damn far.
And so it's just figuring out the management part of this is the thing.
Talk about empowering young people. We've had a ton of founders on the show who have the origin story of like, yeah, I was the GM of Miami or he sent me to Atlanta and I was me in a hotel room with a bunch of energy drinks and we had to open up this market. So we had to do a stunt and hire some people and it just felt like a lot, you know, startup within a startup is a bad phrase that gets sort of misused. But why were you, you know, you weren't, this wasn't your first company with Uber. Why were you so heavy on leaning on young people, empowering them, pushing them?
It wasn't on purpose.
It was just the right answer.
Okay. Why?
Um, yeah. I mean, once you have a city team and you're like, 'Okay, I need to find people that can run this.' Like, old people aren't the answer.
Like, I need fresh. I didn't think of it as like, I got to get youthful people or not. I'm just like, I need good talent that can go do X and who has no judgment on what it is we got to get done.
And it was just like water flows downhill.
So, um, what do you look at? It was a, you know, like the first driver ops guy that we brought in in San Francisco in 2010. We basically took 200 cards and put names on them and we said, 'Alphabetize them. Click.' And we just would measure how much time it took to alphabetize. We would give them like crazy analytics tests and then we're like, 'Okay, this is our guy.' You know what I mean?
Free AI.
If you're on the marketing manager, if you're on the marketing manager, but even today, you'd still want that guy.
Even today. So like you can't use AI now. Alphabetize in the most efficient way. Now, if you know computer science, sorting is like a big freaking deal. Sorting efficiently and being able to do that in your brain, not in software, is a thing. That's what ops people do.
Yeah. Yeah, that makes sense.
So, um, I don't know. I don't know how to answer that question other than problem solving, whether you're young or old, executive or junior, who can solve problems is number one.
When you interview, simulate what it's like working together so that day one is really like week two. And you're already pumped because you saw them in action.
How are you with Adams? How are you thinking about recruiting and how are you going to change your approach to building the company? You've been kind of holed up in LA. This is your kind of hideout. Yeah, totally.
But I imagine like do you push back into SF? Go back to being the king.
Well, here. So, first let's just be clear. On December 18th, I moved to Texas.
Sure. You know, I don't know what's so specific about December 18th, but let's just say it's prior to January.
Um, so I'm a primary resident of Texas, but the action for a lot of this Adams-type technology I'm talking about, of course, like the Bay is a real thing. My head of the advanced technology group at Uber is running my robotics division at Adams. It's called Lab 37. That's Anthony in Pittsburgh. No, no, that's Eric Myhoffer.
Okay. Eric Myhoffer.
So that's robotics on the food side. Um, yeah, Anthony Evidendowski was running Pronto. I was the largest investor in Pronto and then we just were basically right in the final like we're checking off the list, maybe closing today or tomorrow on that deal. So.
Amazing. Let's talk about that deal.
Give us, give us, yeah, give us like kind of background on Pronto and then how it fits into the empire.
Well, look, I sort of broke out how mining fits. Yeah. Right. So, we got that.
Look, I've been, I'm the largest investor in Pronto.
Um, and it's super inspiring work. Like, go to a mine, right? Check out how these things work and let your mind imagine what that might look like when you bring automation to it and how much more productive it is and what that means for industry when all mines are producing more. Where does that go? Um, and in some ways you could say low-hanging fruit on the autonomy problem because yes, there are different problems off-road, but they ain't like they're way more controlled than what's going on on-road.
Okay, but then you get into the physical action like cars on the road, the Waymos on the road, you know, they're moving but they're not acting on atoms, right? So when you think about excavation and you think about crush, like when you get the material and then you move it, then you are basically crushing the material and then you process it. You think about all of the automation through that stack, it's fantastic.
And it's like it's hard, right? Like somebody asked me, like we have a bunch of roboticists that make some of our food machines and somebody came like, 'Hey, like is AI going to help us design food machines?' We're like, 'Dude, let me show you.'
Like this thing has like an insane number of parts and let me show you just the design of a single part.
Like that AI can't even do freaking math. You know what I mean? It's like this is not, we're not there yet. Now, could it get there? Yeah. But then you're really an AGI. If you look at how much harder it is the physical world, how much harder it is AI in the physical world versus in the digital world, and I'm not demeaning it in any way. I'm just saying it's like maybe let's call it a different problem set.
Yeah, you're, we're just far away from one way less training data. Yeah, the it's like one-shotting on software, dude. One-shotting on designing a machine or a robot.
We're just not there yet.
Yeah, not there yet.
But that makes it more fun. That's the point is like do the hard things. If you are in the Adams world, you have decided, I like hard things. I like pain more than anybody else.
Yeah, this is kind of what you got to be about.
Chewing glass.
I love it.
So I can see how AVs at Adams fit into mining. What other and just heavy industry broadly? What other kind of categories of AVs are exciting? How do you see the space evolving? Yeah. Look, I anything, I mean we the mission is wheelbase for robots.
So then you're just like, okay, what moves?
Right. And you go, okay, where you have to find the businesses that make sense. Of course. So we're like, okay, mining is a no-brainer.
What about how do you think about sizing for wheelbase for robots that can scale up and down like crazy? I tell my team like, 'Dude, there's like a ton of silver medals here and there's actually a few other gold medals just in the category.' Um, so let's just go with delivery robots like food delivery, which of course is near and dear to my heart. Um, you make a lot, your 20, yeah, your 30, your $15 bowl became 30 bucks.
Okay. Two. This is like I would put it up there as like one of the number one annoyances of the average American regardless of where they are in society. It's like food is just the cost of food delivery. Everybody wants food fast, cheap, hot, etc.
And there's all this data that just came out this week that just shows like it doesn't matter even how much money you're making, you're spending a lot on this category. Isn't it interesting? Right. Remember I talked about the plumbers.
But like you could take whole categories become the long pole in the tent.
Food.
Boring.
To a lot of people boring is that for me. Interesting. Let's go.
Let's go. But I look, I did taxis.
I did taxis.
When they're like people are looking at me funny.
It was a weird idea.
Okay. They're looking at me super funny. So Jason Calcanis, the most famous investor in Uber of all time.
More famous than you in some.
Whenever I meet with him, I'm like, 'Dude, I'm so honored to be meeting one of our early investors.'
But he, there was like an angel group that I pitched to.
There were like 30, 40 people in the room. I think it was like three or four that invested.
It's crazy.
Okay. The 10 grand check became like a hundred million bucks. It was crazy.
Wow.
But um the boring places are the places. Yeah, you know, less competitive, but also just weird and hard.
There's a reason why it's that way.
The graveyard is stacked of tech guys that thought they could crack food, which is why, which is again like, yeah, go back to and you can go compete in this category, but you have to actually be insane and you have to have.
Yeah.
And you have to attack at all these levels. And my head of the robotics division.
Yeah.
We're like, 'Yeah, let's do this. Get the band back together. Let's go.' Right. This is Eric Myhoffer.
Yeah.
And um and he's like, 'Okay, we can make a food row.' I'm like, 'I got one, there's one requirement though. I got one, what hanging chatter, one string attached.' He's like, 'What?' I'm like, 'You're going to have to build a restaurant that the robot serves.' Mhm.
So my roboticist team in Pittsburgh made a restaurant that is the restaurant that our first robot went into because we had to make sure that we understood how a restaurant worked.
We had to make sure that this wasn't just a machine that made food, but a machine that makes food in the ecosystem of machines called a restaurant.
Yeah.
And uh people don't understand, but a restaurant is a manufacturing facility. In fact, if you look at like the labor statistics, etc., restaurants fits under manufacturing.
Yeah.
For obvious reasons. It just hasn't changed in 50 years.
Yeah. Yeah.
Anyways, back to.
Sorry, I'm all over the place.
No, I love it. I love it. Firing on all cylinders. Yeah. But so again, do you want to move people with AVs? Do you care more about commercial? Look, the industrial thing is sort of like probably our main jam, but the bottom line is once you crack movement in the physical world, there's lots of people who want access to that.
Yeah.
And in fact, you need partners because, you know, you're going to be putting billions of dollars to work to make it happen. Yeah.
So, there's going to be lots of partners across different categories that are going to probably want some of that. And I have no issues with that. We're not like a, you know, this is ours and this thing. It's more like, hey, there may be ways to work with others. We're happy to do it.
Yeah. We got to pick our spots, but you get the idea.
What about manufacturing broadly? You're doing it in food. Are there other categories that are interesting or are you happy to be kind of the transport rails? Look, I think once you are in physical AI, you should basically understand that manufacturing is part of your tech stack.
Like it just is. And by the way, energy is part of your tech stack. Land development, real estate is part of your tech stack. That's just what it's going to be. People don't think about it like that, but it's true. Of course, there, you know, I, you know, Tesla just crushes. If you look at this list of things, you're just like, they got it all.
So good. But there's just so much to do.
Yeah. Yeah.
You know what I mean? So, it's like, we can see all the things. We can see all the things Tesla's doing. That's cool. I'm like, there's a million.
I can still help you mine.
I could still get some food to some peeps. You know what I mean? So, you get the idea.
Is that really when you're pitching investors around Adams and this new vision? Is it basically like there's a lot of jobs to do in the world. We're going to do it with physical AI and you're basically betting on applying my general ethos to all these categories over time. No, you got to be able to pick your spots. If you are too broad, people are like, 'Dude, what's wrong with you?' Now, you know, I think every entrepreneur always gets that like, you know, I joke around like in the 90s, dude, I'm an old guy. What are you going to do? In the 90s, it's like, dude, Microsoft's going to kill you. Like, why do you think? Then in the 2000s, it was like, why isn't Google going to do this? In the 2010s, it's like, dude, that looks like Uber's thing. Yeah.
In the, you know, now it's like, if you're talking about physical AI, it's like, that's Tesla. They are the incumbent. They are. And not just the incumbent, they're also just doing great awesome stuff.
But find your spot.
Yeah.
Know yourself. Know what you're good at. Be self-aware. And find the thing that is your business soulmate for sure, but also know that you're in an ecosystem and you need to find your spot.
Mhm.
What was your experience like in the financial crisis broadly in 2008?
Okay. So, basically I sold my peer-to-peer CDN. Yeah.
Okami meets BitTorrent in 2007 to Okami.
Okay. So I was earning out when that happened and I just started, I think I didn't last very long in that earnout. So I was the CXO. I was like an adviser and a CXO.
Okay.
Little known fact, I was blogging.
Okay.
I was like a tech influencer blogger.
There is a blog still out there called Swooshing.
Yeah.
Okay. Crazy amazing ridiculous content. Okay. Okay, we're going to dedicate.
I was in the click economy, guys. I was in it. Okay, but so I was an adviser and CXO for like five different companies at a time. And so I'd help them on their deals or I would be their CTO.
Yeah.
Or I would, you know, help them sell or product or whatever, but I could always just put the phone down and forget.
So somewhat insulated from like the mortgage crash like.
Yeah. I mean, my thing was I was trying to figure out, I was getting a bunch of my friends together and saying, 'Okay, do you have a mortgage with Bank of America?' I do, too. Let's pull our thing. I'm going to go to Bank of America and say, 'I will buy these mortgages off for 40 cents on the dollar.'
Because you're selling them on the market for 10 cents.
Interesting.
Could be fun. And then they're like, 'Get out of here.'
Yeah.
Crazy.
You're not a hedge fund.
It's wild. What about you're talking about the 90s?
Yeah, the 90s. Like late 90s. Like I mean, you're still at that point you're like sort of starting your career, right? But it's an interesting place to start a career in tech. Like a lot of people watched that and said, 'Huh, that.'
So look, that was a, we did peer-to-peer file sharing at a company called Scour. Yeah.
Okay. So some people did Napster, some went to like, you know, all the ones that came after BitTorrent all the way to like what was the one that Zenstrom did? Kazaa or some of these others, right?
We were the OG file sharing. Okay.
Um.
Michael Oitz was on the board. Ron Burkel was on the board. LA. Okay. Doing tech in LA was like being a finance guy in Fresno. They're like, don't know what the hell is going on. They're like, who are you?
Um, and um, you're a little bit sheltered from it in LA. Every time you went to Silicon Valley, it was like wild and crazy and like every bar was like packed.
Like after hours, like happy hour thing. Like things were bubbling. And the crazy part is not just what happened during the run-up. It was post.
Yeah.
I was raising money on this peer-to-peer CDN that I didn't pay myself a salary for four years. I was raising money in late 2001 for a networking software company.
Yeah.
Are you freaking kidding me? And so I remember going to a bar to meet up with a VC.
And this is like 2002 and it's empty. Like this thing that would be mega packed just two years earlier.
I mean we're talking dust bowl tumbleweeds empty. And this VC, I wish I remember who it was because it'd be amazing.
Was like, 'Yeah, Travis, dude, I think it's all done. It's over. It's over.'
I told you it's over.
And I'm like, 'What do you mean?' He's like, 'All the software that could be invented has been invented.'
Wow.
We're done.
And he meant it.
He's like, 'It's been real, dude. Let's have a whiskey. Let's go. We're done.' That's incredible. How have you processed the last two years when people are able to raise an amount of money that took you four different rooms in this entire process and they can just raise it literally without a deck often. They can just pull it together.
Look, it's all good. Like I don't, I just have because you know when you build a company the way I built it which is like my current one where you're literally under the radar it means that you are powered by, you have an internal fulfillment. You're not like caring what others think. You get internally fulfilled with building.
Yeah.
And um I don't look at somebody and go, oh dude, that's, I had it so much harder uphill both ways to school whatever. Yeah. You know, I don't think like that. It's more about the excellence of the process.
Yeah.
So, I'm like, 'Well, how do you raise money?' And they're like, 'Oh, yeah. Just throw a deck to the guy.' I'm like, 'Okay, well, that's not a thing.'
Yeah.
What is a thing is going all the way until it hurts. If you're doing something and it's easy, it's not valuable. And I'll explain. Like, let's just think of like a marathoner.
Yeah. World class marathoner on mile 21. Is that dude smiling? No, he's not smiling. By the way, if he is smiling, you know what's about to happen? He's about to get his ass whooped. Okay, it's over.
Because why? Because somebody else who's down for the pain will go harder and further and pass him.
Yeah.
And so if you're getting money easy, I'm like, why didn't you go harder? You could have done it better and more. Mhm.
Now, you don't do things hard just because maybe it's like it just doesn't matter, dude. Like, I got to go do something else that's hard. But the key is like if money matters, which I think we would say it does, especially in certain categories, you need to be the best in the world at it.
And it's not enough to say it was easy. If anybody comes to me and says a strategic thing was easy, I'm like, you messed up.
You could have been way better and gone way further. More competitive advantage, more differentiation. Get it together.
Give me the update.
Feel like Tony Robbins right now.
I love it. I love it. No, I think people need to hear this.
They do. They do.
And yeah, the challenge is like when if raising money is super easy and then you actually start building and you're like, whoa, actually money makes this possible, but it doesn't make the work easy.
Yeah.
And it is funny that some of the greatest fundraisers, the critique is always like, oh well, they are raising too much money. You look at Elon, Sam, all these crazy deals and people are like, well, like, okay, it's nice that you're good, but like, are you too good? And look, here's the thing. You know, back in the day, 2010s reference, like there was a problem with getting Masa money.
Yeah.
There was a problem with that.
Yeah.
Because it was easy money.
Sure.
And it was too loose.
Yeah. And so people would get loose with the culture of the investor that they were getting the money from.
Sure.
And so you had to be careful. So if somebody got Masa money, I'd be like, 'Dude, you got to grind.' It was maybe a little too easy. Yeah.
And you still to this day. So, there's nothing wrong with money as a sort of a competitive advantage or a strategic weapon. It's okay. Like, that's part of business. It's necessary. But treat it with respect.
Last question about Texas. For the Californians that are thinking about making a trip out there, Austin, Dallas, Houston, what do you recommend?
Well, look, I'm Austin now. I own a place in Austin. I've owned it for 5 years. I'm an avid, I would say almost professional water skier.
Nice. Slalom ski.
I'll send a video.
That's amazing.
It's sick. Don't even get me started. Um, so I've owned a place there for 5 years.
Right on the lake. Lake Austin, 20 minutes from the city.
There you go.
Lake life. Hell yeah. Go for it. Okay.
I get a little bit FOMO on like these people going to Florida. I'm like, 'Dude, why so much Florida action?' Like, come on, homies. Like, I know it's been a blood bath for just every guy going to Florida.
But like, yeah, like every weekend this year I've had this year in Texas.
Yeah.
You ever take calls while you're water skiing? Like AirPods?
Gosh, dude. I should be good.
I love it. Don't get me excited. Well, I went to Seronic, which does the boats, the autonomous boats, and I'm like, build me a water skiing trip.
Water skiing boat. Okay.
I just want to water ski and like water skiing behind a boat is so funny. So good.
Water ski pretty viral.
Who should come? You're poking your head up.
Who should come work for you?
Yeah.
60 seconds. Who do you want?
Not any individual person, but like funny. I have a message for this one guy who didn't take my offer. Look, I think the thing is like we're just getting the best. This is so cliche and like whatever banal, but look, we are in the physical AI space. So, it's a mix of sort of let's call it sensors, compute, the software that sits on top of those things. Um, I mean it's just going to be great engineers and then you go through what I would call the physical AI stack and you would, you know, but it's a long project, it's someone who wants a career.
It's like infrastructure software guys because you've got to have epic AI on the back end and the way to use that sort of has to be epic. You have to have physical AI model people who are sort of translating foundational models into the physical world and there's some core research and some just like I know all the white papers and we're just going to, we're building and going end to end or some hybrid version of that.
Um, you have just normal software because you've got applications that sit on top that then of course customers see in some fashion or another. Actuation and manipulation on the mechanical and sort of robotic side of things and mechanical engineers that build machines. Um, wow, you know, and then of course remember I've got construction, real estate. Like I could go on. It's lots of cool stuff. Go to the website. There's lots of stuff.
Go to the website, folks. Go to the website.
Adams.co. And by the way, adams.co/vision. I just threw down.
Okay. Read it. Amazing.
Check it out. Well, thank you for taking the time to come out with us. This was awesome. Thank you so much along really quickly. Um, thank you so much. Should I get up?
Yeah.
Okay, cool. I don't know.
We will talk to you soon.
Let me tell you about Phantom Cash. Fund your wallet without exchanges or middlemen and spend with the Phantom card. And let me also tell you about Reream. One live stream, 30 plus destinations. If you want to multiream, go to reream.com. And we are shifting the schedule. We will continue to talk to more guests. We have Gustav from Spotify in the reream waiting room. Let's bring him into the TVP Ultradome. Gustav, how are you doing?
What's going on?
Hey, John. Hey, Jordy. How's it going?
Thank you so much for taking the time to join us. First, tell us where are you?
So, it looks like I'm in some teenager's bedroom from the 80s here. It's actually a small studio we have in Austin. I'm here for South by Southwest.
You know, the first time I went to South by Southwest, the coolest party was the Spotify house. That I have a very fond memory of going, I think this was in 2013 or 2012, something like that. So you've clearly been there a long time.
Yeah. It's always a great time. What's on the agenda? What is the message that you're trying to send to the world at South by Southwest today?
Well, first of all, I'm here because Spotify is turning 20. Wow.
It seems crazy. You know, most companies don't make it five years.
Yeah. An overnight success. 20 years in the making for sure. So that's why I'm here. And then, you know, obviously I'm here talking about what it is that we're doing, our thoughts and plans for the future.
Yeah. So I mean I'm sure you're getting a million questions about AI. How do you see AI fitting into the Spotify ecosystem? There's a whole bunch of super useful ways that I think people would be super excited about. There's other people that are a little bit worried about AI and how it might play out in Spotify's world. What are you thinking good looks like over the next couple years?
Yeah, of course, everyone is asking about AI and as you said, there are a lot of, you know, hot takes and breathless takes on Twitter all the time and there's a lot of dystopian takes. Yeah.
I'm very positive about the future and I think if we look at the consumer experience, I think it's going to change completely and not just for Spotify. I think all consumer companies are going to have to change what they are and how they work because I think consumers are sitting over here, you know, with Claude or with ChatGPT or with Gemini and they're getting freaking AGI-ish intelligence and then you're going to media service over here and it's dumb as a rock.
That's not going to work.
Like it's going to need to get intelligent.
So what we've said, what I've said at our latest earnings call is that we're going to build the first, the world's first truly intelligent agentic media system. Those are a lot of buzzwords, but I'll tell you what I actually think they mean.
What I think is so interesting with generative AI versus kind of old school machine learning and personalization, which Spotify has done for a long time, is that computers finally understand English. What's the point of that? Well, Spotify for a long time, you know, when we developed the product, we always had these user focus groups. You know, you invite 10 people into a room, you have like deep English language discussions with them about what they actually feel and what they actually want. And then you went and built this average product that could only measure skips and swipes and you try to squint and approximate what the user was actually thinking. The problems of generative AI is you just talk to us in English at a scale of 750 million people. So I kind of think of it as a 750 million people user research always ongoing into you. That's what products are going to be in the future and I want Spotify to lead that. So, we've been investing in some of these products. The first one was AI DJ.
Yeah.
Where you can literally talk to Spotify. You can ask, you can say, you know, I want to go for a run, give me some EDM playlist with big drops at 160 BPM for my running cadence.
And then earlier this year, we launched prompted playlists, which takes it one step further. You can build your own playlist using English language. You're literally writing your own algorithm. So, if you want a playlist that goes out and looks at TikTok and what's trending right now, then takes that, filters it to your taste on Spotify, then removes any track you've already heard, you can literally do that today. And you can schedule it to update daily or weekly. So, that's what we've done so far. And then today, what I talked about is sort of the next step, which is today's profile.
Yeah, this is what users have been asking us for forever. So like hidden in all these systems, we have a view of who you are musically and podcast wise and audiobook wise, but you could never actually see that. You can see hints of it in Wrapped, but you can never actually see it. So the idea is pretty simple.
We're just going to let you see who we think you are, and then we're going to let you edit it in English and just say like, 'No, that's not true. I'm not like that anymore. I want to be like this.'
Yeah, it makes me a lot. Yeah. Yeah. It makes so much sense from a personalization standpoint. I mean, Spotify has been doing machine learning for probably most of those 20 years. Certainly more than 10. How do you see yourself integrating with what OpenAI is doing with Sora where there's a persona and a person, an individual can kind of decide how their avatar is used. It feels like there's a natural extension here where not all artists, but some artists are going to want to go to you and say, 'Hey, look, I'm a rock musician, but if people want to listen to my songs remixed with AI as country songs, that's fine as long as I keep getting a check. It's win-win for everyone.' Has there been demand from musicians for that type of experience that feels like maybe the next year or later this year?
Yeah, 100%. So, this is the other big topic. We just talked about consumer experience, but what about generative content? And of course, everyone is asking me about that and specifically music.
And I think what's happening today is people can make net new songs using these services.
Yeah.
And that's great. I'm sure creators will, I'm sure most creators are already using these tools whether they say so or not. Um, sorry, sorry to interrupt, but that's a big thing because you, there's this massive in tech, like, you know, traditional tech. People will tell you they're using an AI tool, even if they're not really, right? They want to be constantly projecting, like I'm using the best tools all the time. I'm using them more than you. I've got, you know, 10 Mac minis running. They'll tell you. But in music, it's like the exact opposite where like people are, from my experience talking to musicians and people in the music industry, they're like, 'This is changing everything. It's crazy. It's magical. It's an amazing tool.' But then they won't talk about it at all, right? They, it's like, you know, they'll never talk about.
That's exactly it. And I understand that. I have a lot of empathy for musicians and artists being scared because everything is changing and change is scary. So, you know, I want to be clear that it's understandable that people have a lot of fear.
Yeah.
But the way we think about it is, you know, technology can cause a lot of chaos. But if you can combine technology with a good business model, it can be very good for the world. So what I'm excited about is today I think some artists that use these tools they get help with creating net new music but most of the existing artists they just get no benefit from AI and I think that seems wrong to me. I think what you mentioned John is if you're an existing artist what many of them do today is they work with other people to do remixes and covers right of their music. It's like existing IP. This is what you do in movies. Like existing IP is supposed to be the most valuable part not the least valuable part. So I do think that many musicians this will be voluntary of course would be very interested in letting their super fans play around with their music if they could get compensated correctly. It is the business model that needs to be figured out and this is what Spotify did during piracy. We took the long painful route of not going the illegal route and figuring it out. It was hard and painful. This is what we want to do here as well.
Yeah. Yeah. It feels like I mean you hear these stories about breakout songs. There was a song called Old Town Road that sampled Nine Inch Nails and I think the original artist that remixed that song didn't actually have the rights because he just sort of whipped it up on a weekend but then once the song exploded the agencies came in and negotiated and I think they accepted award on stage together and everyone was happy. But Spotify feels like in a unique place to actually unleash that level of collaboration in an economically like you know safe way that everyone feels happy at the end of the day. I'm also interested in hearing about how social features are evolving on Spotify. It feels like with a lot of the generative AI projects there's a lot of stuff that goes out broadly, but there's also a lot of you're just having a new creative tool that allows you to tell express yourself to a smaller audience. I find that a lot of the generative images that I put I don't put them on my Instagram. I text them to a group chat and I'm wondering how you see the social features changing on Spotify or where they are, how fast they're growing. Anything that you can tell me about social on Spotify these days?
So you're completely right. We started investing we actually had a lot of social features when we started.
Yeah.
The idea was to sort of approximate the experience of Napster Pirate Bay on the content side but then sort of you know Facebook and your friend graph because back then friends were your main tool of recommendation.
Yeah.
And then your algorithms came and everyone got like an algorithmic friend and we didn't invest as much.
Yeah. But since a few years back, we started investing a lot because we think that today these media platforms, they're single player experiences, they're kind of lonely. They're mostly passive. You sit and swipe and swipe and swipe until you're like falling asleep, right?
We don't want services to be like that. We would like you to lean in and we would like to turn Spotify into an interactive multiplayer experience. So what that sounds like hyperbole. What do I mean with that? I mean features like Jam which is growing like crazy for us many many many tens of millions of users and still growing where you can join a queue and sort of have this shared music experience together in the same place or actually remotely and then you have something that's been around for a long time which is collaborative playlist which have insane retention and engagement where people collaborate around a playlist and they want to talk about that. So, we are investing quite a lot in turning Spotify into this place where you are with your friends.
Yeah.
Where you're not just by yourself. So, I'm 100% with you. I'm very excited about trying to create sort of a more positive future, if that makes sense. One thing I really love about having worked at Spotify for 20 years is that we kind of lucked into music, which almost everyone agrees that music is a good in the world. There's very few people who think that music is bad.
But then we kept that, you know, we went into podcasts because we thought it was like long form discussions. People spoke in full sentences. It was very the perfect counter to the shortification of media that was happening and then you know last year we went into books in a big way. So we try to do things that we think are good for the world. Internally we have some beliefs not all of which are public because we want to keep some secrets but one of them is no regrets. Yeah, we try we focus on content that has very little regret. And yeah, you guys are to me you guys are the antislop company platform and there's not any there really aren't any of them left. You could go on LinkedIn now and you could spend 24 hours straight scrolling through short form video. And so talk to us about running a company where it feels like you're constantly making decisions to avoid doing things that would almost certainly get a lot of engagement and usage but aren't necessarily aligned with the kind of core values of the company because eventually companies get 20 years in and they just start doing things that are just optimizing for all those metrics and a lot of that. Everyone has, you know, incredible values until you're a public company and you've got all these, you know, different incentives.
Yeah, that's so true. And that is a risk that that's one of the benefits of me and the other co Alex Northstrom having been at this company for like 17 18 years. So, you know, those values are ingrained in us. Now the way we think about it is I think it's both something that is very motivating for me as a person and for many of our employees but it has also to be aligned with your business model right and it is because Spotify in terms of revenue is majority of subscription service you know close to 90% of the revenue is from a subscription and if you think about what that means it means that a Spotify user every month they're going to vote with their wallet and if you ask yourself the question when you vote. What do you to pay for something? What is it that you're going to pay for? Are you going to pay for time spent? I don't think so. You know, when we survey users for the different services out there, I won't say which one, but many of the big services, even young people regret 70% of the time.
They spent there.
On Spotify, they regret less than 3%.
Right.
Wow.
And I think if you're going to pay for something, you're not going to pay for something you regret. That's like a that's an oxymoron, right? So it's very it's very aligned with our business model. I actually think you pay for what you want to be something aspirational, right? So so I think it's both a value that we have but it is actually very much aligned with the business model. I think if we were 90% an advertising model, the pressure to maximize for engagement would be very tricky. So it's both a value and something that actually works for us. So so we're just leaning into that because we think it's a differentiated proposition. And right now I feel like the need for for low regret content is increasing, not decreasing.
Yeah. It's it's such a it's such a wildly different experience going into the Spotify app.
Mhm.
For me where it's always like it's always intentional. I'm coming in and like I'm doing the thinking around what what what content do I want to consume? That is just completely opposite to every other app that I use which is deciding basically on the fly what is going to keep him what is going to keep him in the app as much as possible and that's not necessarily that's that's why I'm so excited about this the user control right because I think it's very aligned with that to give back control to the user like now you control the algorithm it's tricky um but that's the path we're going uh because it's very much aligned with uh no regrets if you can tell ahead of time what you want Spotify to do.
You're not going to, you know, chances that you regret that are very low. And and we've seen this people saying like, you know, when we test this internally, the taste profile. Uh, one of the people I spoke to said, I used to be into classical music a lot when I was younger, but then the Spotify algorithm like it it preferred popular music, so I fell out of it. I went into my taste profile and just said, "I want the classical shelf on my homepage every day." And now they're back into it because now that's what they get fed with. And I think that's very cool when you can like game yourself to what you actually want to be.
Yeah. I I wouldn't have predicted that Spotify would be the first one to have that sort of like natural language control over your feed. People have been demanding that in in across all different social media platforms, threads launch something where you can say dear threads and then it will update. Dear Algo, that's it. Dear Algo um but but yeah, that makes a ton of sense.
I think it's because of the advertising model for us. If we the risk here is that the user takes control and says something that lowers engagement a bit.
Yeah.
For us it's fine because they pay per month.
Yeah.
We don't monetize the engagement directly for the most part.
Yeah.
That I think is the key.
Yeah. What what's the biggest misconception about Spotify right now?
Oh, the biggest misconception. Oh, now now Okay, you'll have to stop me. I'll get up on my little soap box here. This is something that has hurt me so much for so many years. Uh because we got it wrong. Uh This is about artist payouts and the pay and and the the the idea that we pay less to artists than than other companies.
And for the longest time, you know, this has gone back a long time, people talked about per stream payouts and so forth. And the the the sort of advice at the time was you shouldn't engage because you only bring more attention to the matter and if we just keep paying more than anyone else, the record is going to set itself straight.
Yeah.
That doesn't happen. What happens when you leave a narrative like that forever is that it becomes truth, right? So, I kind of want to set that straight.
So, if you look at Spotify, we've paid out over 70 billion to the music industry. 11 billion of those just last year. I want to be clear, that's more than anyone has paid anyone ever in the music industry.
Yeah.
So, like the music industry is bigger than it ever was. People talk about the heydays of the 80s and and the seed era, but the music industry is bigger than that.
Yeah. And not only that, you know, in the CD era, the the sort of distributor, the the record store, they, you know, we we give about 70% of what we make back to the music industry. If we bring in $1, we get about 70.7 70 cents to the music industry.
The record store, if you wanted to be at the front of the record store, could keep 70% or 100. So like the pie is bigger and the share of the pie that goes to the music industry is bigger than it ever was. And so when I tell that to people, they're like, "Huh?" But I keep hearing that you guys pay less per stream, right? Like you're evil somehow, aren't you?
Yeah.
And my point is like, and this is not backed by public data, no one in the industry pays per stream. We all pay per user.
Yeah.
And we all pay roughly 70% per user. You know, Apple, Amazon, YouTube, all of them. The thing is Spotify has almost three to four times the amount of usage per user of our competitors, which is crazy to me. Actually, when I first saw it, I couldn't believe it. But now it's backed by public data. So, what happens if you take the same amount of money, but we divide it by three to four times more streams.
Yeah, of course, our per stream is going to be lower.
But that's because people use the product more. And the solution to that isn't to make the product three, four times worse to gain the per stream metric or raise the price three, four times because that that would just be bad for the entire music industry.
So this is the misconception I want to set straight. No one pays per stream. We all pay per user. And we happen to have much more engagement per user than the other platforms. And they've actually sort of weaponized and used this against us uh to say like we pay more more than Spotify per stream.
Yeah. Yeah.
But that's that's important. How are you thinking about the evolution of Spotify's role with live events? I feel like in the age of AI, the recommendations get even better because I listen to a lot of different genres. I don't go to a lot of different genres of concerts. There's definitely bands that I listen to where I'm like, I'm too old for that mosh pit. I'm not going to that heavy metal concert, but I would love to go to this old maybe. Maybe.
Yeah. Yeah. We'll we'll we'll go to the Sleep Token concert together. But um but but it does feel like um like Spotify will be in an increasingly more interesting role in actually surfacing uh awareness around live in-person events which also might get more important in an age of AI in an age of unlimited content. Uh you might actually see this barbell effect where there's endless content and then very unique experiences in the real world. What do you think about live events?
Yeah, I I think you're 100% right. And two things there I think are important. You know, if everything in the world is kind of a power law, right? Yeah. You have the endless the endless long tail, but you also have a very big head. So, so you know, people ask me like, are Netflix or YouTube winning? I'm like both. The biggest Netflix shows are bigger than ever, monoculture, and YouTube is bigger than ever. And the same is true in music, right? So, there are more indie artists than there's ever been, but Taylor Swift is bigger than anyone has ever been. and the aeros is the biggest thing that ever happened. So people want me to say it's one or the other.
Yeah.
And it's actually both. And I think you're you're you're right because I think what's happening is and and this will probably be exaggerated even more with generative content as people get more and more individual content which they like. They also feel more and more lonely. So the need for like shared experiences increases.
Totally.
And this is just not me theorizing. We're actually selling tickets on Spotify since a few years back. Yeah. because we have such good data on who Taylor Teles's very biggest fan. That is one person in the world in terms of streams actually is right.
That is yes. So, so we've been selling tickets for a while and we've sold over $1.5 billion dollars worth of tickets now and that is increasing quickly which proves your point like live events are becoming more popular than ever and bigger than ever and for many artists the fact that we're selling tickets is very important because for many artists especially well both big ones and up and cominging ones they can be more than 50% of their income. So you have the royalties from from from us but touring is a very big part of most artists income.
Are is is Spotify uniquely well equipped to enter the live ticketing market because you come from uh an origin where you had to do big deals with big organizations and it was not this permissionless company that some other platforms have engaged with. You had to go to the table in Hollywood and sit down with these folks and it feels like you sort of have to do that again if you want to sell ever more tickets.
Yeah, it's funny that you say, you know, we we've never been this permissionless company. That is true. And it's been painful watching other people just run with like, you know, whatever illegal content or something. They're so fast. But over time, it's it's itatches worked out for us.
Yeah.
Yeah. It it has in many cases, but um but you're right. We are well positioned to work with that industry and right now we're actually selling for all of them. You know, we're an aggregator. We're an aggregator of content and we're an aggregator of of concert tickets.
Mhm.
So, I think we're really well positioned. We're already telling most artists where they should tour, in which cities they have the most fans, and which songs they love. And now, it's pretty natural for us to help them actually sell tickets. Obviously, the scalping problem is enormous. And that's something where we are really well positioned to help. The analogy I like to make is that your stream count is is like um proof of work in crypto. It's very hard to fake your stream count, right? So, so using that I think is is very important. and we want to work with the with the with the live you're like oh you want to buy tickets to this artist that you've not streamed a single time it's like I don't know about that exactly and the artist they absolutely we've done some of our own events you know for smaller events for just the super fans sometime and you can tell the difference in in the room when it's just like the stalker level fans in the room.
Uh I want to talk I want to get your kind of highle view on podcasting how it's how it's evolving thing. Uh it I started doing some work with podcast when I was in college back in 2017. At that time it's it felt late uh to me. Uh it always does. It always it always it always feels late. Uh of course I was totally wrong that the biggest deals and and many of the biggest shows were still to come and you guys obviously made a splash uh uh with some of the larger acquisitions in the space. But uh how are you processing the industry today?
So what what happened that was very interesting for us is we looked at the podcasting industry actually the way we came about it was you know we found a lot of our best features looking at either our our users what they do or the publishers start uploading like audiobooks in Germany what is that and then we realized there's demand for audiobooks the podcast is a case of looking our developers because they're this unique crowd that are often early adopters of trends and they have the power to just build what they want to see in the world. And we saw them sort of hacking podcast into the main Spotify app again and again at hack weeks. So we started looking at the podcasting industry and we saw that it was it was amazing. It was this amazing pool of fantastic long form content and very good creators. But it was just sort of left for dead. So we decided to go in there and bet that if we supported it, it would grow. And that worked out. We we grew like crazy for for what was then called sort of traditional podcast, audio podcast. Then what happened was and Joe Rogan was always the first with this many podcast started doing video but for a long time it was just Joe Rogan and the interesting thing is because we had Joe Rogan on our platform we had to build video support. It was partially thanks to him that we did it because he was like I can't be without video. If you want the show it has to be video. We're like oh [__] are we going to build a full video stack for one podcast? I guess we are.
Yeah.
And then we built it.
Yeah. But that was very lucky for us because then we could see what video podcast how they performed on the platform and we saw that people listen a lot in the background and they dip in and out and we're like huh this is probably where the whole thing is going. So we started investing more and then all the creators started doing video.
Yeah.
So what's interesting for us is that the audio podcast market was this like I don't know couple of billion dollar market. It wasn't that big.
Yeah. But because audio became video, they kind of pushed us into a much bigger market which is video which is you know 10 times bigger at least one two orders of magnitude. So for us it was like a gift that the creators quote unquote forced us to get into this bigger market.
Yeah.
So we're very happy about it. And what we find from creators like yourselves is they they want to multihome. They want distribution. They want to be on all the platforms. And that's always been our, you know, in music we were always, all the artists were multihomed. All the book, all the book authors we have, they're multihomed. So, so that's our strategy. And then in terms of what we've done that really changed the trajectory for us is yes, technically we could have video podcast for a long time, but as you guys know who are into the details, audio podcast uh used to monetize in in a in a certain way uh with audio ads. And what happened was when you couldn't have your dynamic audio ads, the DAI when you went to video, actually the weird thing is you put video on Spotify and you would make less money.
Oh, which is completely wrong cuz the users loved it. So your experience got better, but you made less money.
So finally, beginning of 2025, we solved that because what we said was, okay, we're just going to pay out of the premium pool.
Sure.
For video podcasters. So now your use, you don't have to stuff ads into the podcast as much. So your user experience goes better, your retention goes up. Y, but you don't have to compromise on economics. We're going to pay as much. And that really that made all the video podcasters come on board Spotify.
That's amazing. Well, thank you so much for taking the time to we're uh we we've been uh kind of beating the beating the drum on we think there's a lot more shows for to to make like TVPN basically look at any cuz cuz in many ways we've done some interesting things on the formatting side but a lot of interesting things but but we just took what had worked in many ways on traditional cable and I think that every single show on traditional cable is re is just sort of waiting to be rebuilt for the Spotify platform and and other platforms. So, I think that uh lots more to come.
This is such an innovative format. It's awesome. I watch it every day and and you know because you guys publish the whole thing to Spotify. Catch up.
It's amazing. I love when we get a Spotify comment that is clearly someone who watched the video because they noticed something that you would only it wasn't really in the audio feed, but they were clearly watching in video.
You know, you said you said creators want to be multihome. Uh but I disagree. I wish we lived in a world where there was just Spotify and we could just focus all of our energy.
I'll take that. I'll take it. You got more work to do.
Thank you so much. Enjoy the rest of South by Southwest. Say hello to everyone for us and we'll talk to you soon.
Goodbye. Let me tell you about Oops. Gusto.com. That's the wrong one. Uh the unified platform for payroll and benefits and HR built for to evolve with modern small and mediumsiz businesses. And let me also tell you about public.com investing for those who take it seriously. They got stocks, options, bonds, crypto, treasuries, and more with great customer service. We are joined now by uh Tim. Thank you so much for taking the time to come talk to us. First time on the show. Please introduce yourself.
Yeah, Tim Kugen, CEO of GoFundMe. Thank you very much for having me.
Tell me a little bit about your journey to GoFundMe. What was your backtory?
I started, you know, I came to Stanford in the mid '90s. Uh got sucked into the internet really early.
Non-traditional background.
Yeah. Yeah. Yeah. uh did some startup stuff, ended up going to Yahoo, ran the ad business at Yahoo, then went did another startup wearing this guy.
See this? Oh man, we're huge fans. You know that sound. We not wearing a lot of purple being a red head. That never worked. But yeah, five great years there. Went to do my own startup in the ad space, OpenX. Built that up. That was great.
But got to thinking, hey, I want to do something completely different. I had uh I'd become a search and rescue volunteer around 2010 up here in the mountains in San Gabriel. I loved that and I was thinking, hey, could I kind of run a company that also was really useful and helpful to people.
Yeah.
Somehow got that good for me job started March 2nd, 2020.
Amazing.
The pandemic, I mean, mayhem and just what a lesson in how valuable the platform was.
Wow. You were joining right I'm sure there was just a surge because of all the just dislocations. It was literally it was that week where I think the world realized that this was global.
Y I had four days to meet people on the Friday. I'm like we'd better go remote. I thought it would be like three weeks and then it was you know a year or so and yes demand I mean the the need of people on the platform and all the expected ways the medical stuff but also small businesses tens of thousands of restaurants bars music venues having to furlow employees and lots of fundraisers being created often by their patrons who are like we we love this restaurant it's our favorite local restaurant we yeah that was actually that was that was the the the silver lining of that moment was how much excitement and willingness there was from people that were in a better situation during co or maybe they were had chaos in their own life but they still wanted to go out of their way uh and and the ingenuity of of individuals and businesses to like come up with ways to like make these kind of exchanges work.
Well I mean it's actually it's you bring up the silver lining point like the silver that's often the case that when something difficult happens in our lives or in community or a natural disaster. The silver lining, and there really is not a lot of silver linings, but one is people want to come together and help each other in the face of that situation. And we see that again and again, whether it be an individual situation or like what happened here in LA last.
I was about to ask about the fire. So I I know watch duty was on there. Is that correct?
Oh my god. I mean, you know what? So many so many nonprofits were helping. I live in Aladena, which is one of the towns live in Pasadena. So, you know, like we lost 6,000 homes. We evacuated, you know, 20 minutes in. Um, and thousands of people personally. Exactly. And we saw $260 million raised for 10,000 families, churches, local businesses, and for the nonprofits like Watchd Duty, Salvation Army, World Central Kitchen, so many people coming in and helping. And um, it has been amazing to see in case of my town, the community coming together and saying, you know, we care about each other and we're going to find a way through this.
So, what's the case study for a a GoFundMe project that goes that goes perfectly? Uh there's a lot of, you know, uh I'm sure there's a lot of rough edges around where does the money go and what conditions does the money get released? All these different things that you have to grapple with. Uh what does your team look like? And then how is technology making that easier?
I think you got about seven questions in there, but let's let's go to the first one. What does a good fun I mean a a really a really good campaign is you put together a story. So a good fun is first and foremost a storytelling platform. You tell a clear story of who you are, what the situation is, what you need in terms of the help i.e. the funds and what it's going to go to and then you put that on the internet and then you tell people about it. And this is we actually launched yesterday this product called the smart fundraising coach which we can talk about more but it helps with every single one of these steps and then you get attention and you start with the people you know your friends your family your neighbors people in your church in your sports team whatever it is and then you build support from there you build momentum you hopefully achieve what you're looking for maybe you exceed that and then throughout that process you set up to receive the money set up for transfers which could be you if it's for you let's Say I set it up for you. Um I'd set it up for you. You would get an invitation to set up your account to be KYCed.
Yeah.
To receive the funds. All the funds go to our payment processors with Aden and Stripe. They sit there until you've been KYC and the money flows to you and you get the help. It's what we call help delivered.
Mhm. Uh yeah, there there's so much uh fear around AI right now and oftentimes that uh people end up overlooking all the incredible parts of it. And that's a good example of uh anyone in the world being able to be like walked through and basically get their handheld through this process that is a deeply you know if you're going and setting up a raise it's usually not because of uh you know it could be some like emergency or or really stressful situation and so being able to give people that kind of um just like one-on-one guidance.
Exactly. So, I had this sort of a couple of years ago. Well, we have a team that helps some clients. We have a customer success team that could help some, but we have like 10,000 10,000 people a day setting up a GoFundMe. Like, we can't deliver that from everyone. So, I was like with everyone. My point to the team is like, look, AI, we can we could do that now. We could give every single person who is considering asking for help. And asking for help is tough. Like, none of us like it. We were just talking in the back like, does any of us like asking for help? No, like we don't like it. It's hard. It's psychologically difficult. Can we give them the functional and the emotional help to go through that process? So that's what we've built.
A lot of trial and error actually. Like a lot of people think you plug the AI and it's better. It's not like it takes taken many months because we have to find not just the the functional like hey it's time to pick your title now. It's time to share which is one of the most difficult things. We often have to find the right tone to do that empathetically to help someone through those steps in the process so that they can get the help they need.
Yeah. What about uh AI on the donor side? I'm thinking about if I show up and I'm like, is this the right Jordy Hayes? Is this his is is this his campaign? Tell me more that might not just be on the landing page already filled out by him. Are you looking at that for the main way we're using AI on the donor side is to verify that the people who are paying in money are actually the right people are doing all of those things to to validate the payins and that's both a combination of us and the payment providers and the banks who are the back end of us. So that's the main news.
You know what you're talking about is sort of more discovery.
Yeah.
Which is still early days. I mean most supporters of fundraisers know the person.
Sure.
Right. they they know either very close relationship or they know them through someone. That's about 80 90% of fundraising is it's really what we're doing is we're modernizing a timeless thing that we've done for each other which is if you used to live in a village and someone was in hard times you you put some money in the box.
Pass the hat. Yep.
Right.
Yeah.
That's what we're doing now. So mostly the sort of social proofing is through relationship networks.
What's the tax treatment on a GoFundMe campaign? There are no goods or services there, so there are no taxes.
There are no taxes.
That's right. It's a gift.
Okay. Yeah. Well, how has the actual team evolved postco? It sounds like you came in and you immediately made the team remote. Are you now in a hybrid setup?
Yeah. Yeah.
How has that evolution?
Uh, I mean, you know, we found our way through it. I mean, we were always quite a distributed company. So, we had LA, uh, Bay Area, San Diego, we got Chicago, we got folks in And is that because of talent or because of the customer base? like, wow, there's a bit of talent. So, the original GoFundMe was set up in San Diego.
Sure.
Brad and Andy set it up back in 2010. Uh, then we needed great talent. So, we also needed to go to the Bay Area. Now, for example, we have a really amazing 100 person engineering and data science team in Buenoseris down in Argentina, which is just they're crushing it. So, we are inherently distributed.
Sure.
So, the the work reflects that. We figured our way through it uh pretty well. Pretty well. What uh what's different about running a company like GoFundMe that's doing uh a lot of like good in the world and uh good you know every Silicon Valley company can paint a picture of how like they're saving the world but you guys are actually you know providing a service that that uh is making a meaningful there's probably dozens of GoFundMes that are like literally pay for my cancer medications like literally cure my cancer and then there's a lot of AI companies that are saying we'll cure cancer one day.
Yeah. What a very different have other companies in the industry like software vendors or payment providers uh do they do they chip in on their side like are you able to negotiate like lower lower rates you know hey if guy if they're listening are you serious they're selling I mean they're selling their products and services I know I know but but uh you know we get a little bit like people do like to talk about working with us because generally it's regarded as a good thing but that's at margin. Honestly, he's a big fan of oligopolies and payment processing apparently. Uh but we have great we have great partners, so I understand, you know, they need to run their businesses and we appreciate them. Um what what's different?
Yeah, I would I would Yeah. No, I I would just think that, you know, if I was like a CRM provider, I might not be trying to m get the maximum amount of value out of, you know, a platform like GoFundMe. Well, maybe they're not getting the maximum, but you know, they're generally, you know, what about the surface area of GoFundMe? Um, I mean, there's other platforms that people use to raise money. I mean, I did a crowdfunding campaign for a food product at one point. Uh, but people do I have a board game project. I have a movie. And there's this somewhat of a fuzzy line between uh a GoFundMe and something like a Kickstarter. Have you thought about broadening out? Do you want to stay narrow? How important is it to define what the brand is and is not?
Yeah, you're right. And uh we do see people fundraising for local businesses quite a bit like you know local restaurant that people love. Maybe it's hit a rough patch or a bookshop or something like that. But you're right kind of business startup stuff.
Yeah. There was a time when crowdfunding was pre seedstage funding or like a signal that you could send to your investors like the original Oculus VR headset was on Kickstarter and then sold to Meta for a billion dollars. That's a very different thing.
Yeah. It tends to be low. I mean we saw 100,000 fundraisers fall small but generally local businesses uh for but you have the platform. Have you thought about expanding?
You know we've still got so much to work to do. So we have expanded. So back in 22 we acquired a company called classy which does fundraising software for nonprofits.
Oh okay.
So I mean if you look at the industry the TAM in the US it's about 2% of GDP. $600 billion is given the vast majority by consumers and most of that is given to nonprofit organizations.
The vast majority is by consumers not billionaires who are writing massive checks.
Most of it is given by by consumers. Okay. Um and most of that goes to nonprofit organizations. GoFundMe obviously started and we're best known for helping individuals ask for help.
Now those individuals generally ask for themselves or someone else but increasingly they're asking for a nonprofit. That was our fastest growing category last year was individuals like I just did one for watch duty because I think what John team are doing is amazing and they super supported us.
So that's a trend.
Sure.
But our main focus has been making consumer fundraising ever better which is why we launched the coach yesterday and continue to innovate there and then helping nonprofits fundra more successfully. So yeah by building basically a network of other people who can fund raise. That's the thing. That's the cool thing is like this intersection between those two things because the average age of a nonprofit donor in America today is about 64.
And nonprofits want to get more young people interested and connected, but a lot of young folks don't necessarily just want to donate. They want to do something. So, we've given them the ability to organize sort of enlist an army of supporters who fundra for them. So, I'll give you an example like American Cancer Society came to us and said, "Hey, we we want to do something like this." We've had like 80 88,000 people organize a fundraiser where they're swimming or walking or riding or walking the dog uh for the benefit of ACS, which raises money, but even more importantly, it spreads the word. Because if if you're telling me, "Yeah, I really care about ACS. It affected my family in this way. I'm doing this run this over this month. Would you support me?" I'm gonna think, hey, I'm going to trust that because I know John and I know ACS. I call it the double trust.
Yeah, that makes a lot like SPVS. SPVS for uh nonprofits.
Yeah, it's kind of, you know, it's it's expanding the aperture of how you generate awareness and support.
What about uh political fundraising? How does that work today? Is it not allowed on the platform?
Very limited. And it's country by country. Very because we're in 20 countries. Um and the rules are very very variable. So it will depend. Some countries just not allowed. Some it is allowed in very specific ways, but frankly it's not a significant thing for us at all. We don't see much of it.
It is not an area of interest. It's just a different Not really. I mean there are pretty well-known and wellused platforms that focus on that. So we don't we don't see much of it. We don't don't honestly expect to.
What about the future of the company? Um how is the company structured? Where do you want to see it go?
Well, we think there's a lot more help to generate in the world. I mean our mission is very simple. Help people help each other. Um, and uh, we think that it's, it's interesting you had Travis earlier because they're a good example. Uber, Airbnb is another one where it's a company that has taken a behavior that was frankly frowned upon. Like remember when you were a kid, one of the things you were always told not to do.
Don't get in a car with a stranger.
Don't get in a stranger's car.
Don't and certainly don't ever go to a stranger's house.
Yeah.
Well, that's normal.
You take now you're take your Airbnb, your Uber, your Airbnb. In our case, you know, it's it's not so asking for help and doing it in public is still not a comfortable and normal thing.
Totally.
And so we're sort of expanding the aperture of like, no, actually, but GoFundMe does have a different aesthetic to it. It's it's it's oh, you're doing a GoFundMe like this is a normal thing. Feels much more normal. Yeah. Yeah. No, you're still building, but you're on the path.
We are. And every customer I've talked to, I say every single one has said something like this was really hard for me to do. If someone just put on their Instagram story like, "Hey, please send me money." That's very different than like, "Hey, I'm doing a GoFundMe for this specific thing. You can go here. There's a lot of details. You know that it's on legit payment rails." Like, exactly. There's accountability, but there's still a lot of work to do in that journey. So, so that we think we can do a lot more of that. And we're, as I mentioned, we're in 20 countries. Some of those countries are still early and adopting and growing quick. Germany, for example, is taking off very quickly.
Um, there's more countries. And then nonprofits, like there's a lot more work to help nonprofits who are as needed now as ever and we only offer our nonprofit solutions in the US today. Got it. So we got a lot more there and then we got some other ideas, you know.
Yeah, it's very cool. Well, I mean, it just I can imagine it massively increasing the efficiency of nonprofits on the fundraising side because they have instead of having to build out, you know, all this, you know, they still have to hire their own staff to support fundraising, but now they get all this kind of like offbalance sheet kind of effort.
We can help amplify. We can help. We do a lot of storytelling. We do that on behalf of our regular consumer customers now. it can help to tell the stories of our nonprofits in in certain situations and that helps them get awareness and get more support.
Well, Tim, thank you so much for taking the time to come down. Thank you very much. Hopefully, I'll see you in Zena soon.
Are you still doing your watch duty fund raise or you should still be I love when I'm not a DA of watchduty, but you never You never know when you're exactly. You never know. And I'm in Malibu. So, we had a crazy time last year.
I hope you guys are doing okay.
Yeah, luckily people.
Thank you so much. Take care, guys. Let me tell you all about Octa. Octa helps you assign every Agent a trusted identity. So, you get the power of AI without the risk. Cure every agent, secure any agent. And let me also tell you about app loving profitable advertising made easy with Axon.ai. Get access to over 1 billion daily active users and grow your business today. And without further ado, we are joined by Nick Heshurora from Palo Alto Networks. Good to meet you. Welcome to the show. Thank you.
Uh for those who might not be familiar with a little bit of your journey, I'd love to kind of get everyone up to speed on what you were doing before and then I want to spend a lot of time talking about just the transformation if you can call it that of Paloto Networks where the business is today. But maybe take us back a little bit.
Where do you want to go? How far back?
Uh well I know you handled business at Google but uh let's go even even let's go back to the very beginning.
Yeah.
As far I grew up in India as you might know. came here to go to business school.
It was a tough time. You couldn't get a job. Okay.
In 1992, it was one of the recessions in the country.
Yeah.
So, I wrote 400 plus letters. In those times, you guys are younger than me.
Cold letters.
Cold. You could email. You had to go. I had to rent a Mac for 3 months.
No, you rented a computer.
I rented a computer. I found 400 addresses of hiring people.
Yeah. And I would sit down, write the letters, type them out, go print them out. Yeah. Put them in envelopes, stuff envelopes, and and mail them.
It's such a different dopamine loop doing a cold letter versus cuz cold email is amazing. You send it. You send No, no, I know. I know. But I'm saying like today kids are used to like, okay, I got to write this email. Maybe they use AI now. But then like often times like for me, I either respond like like within like 30 seconds or 30 days. But uh but like you know you quickly kind of get on get on that loop. But sending an actual letter out and then just kind of praying and and waiting for maybe you know.
Every day I'd get stacks of them back. I got I still have them. I have 400 rejections from 1992.
Wait 400 letters all rejections.
Yes. I only got one job, right? So many of the other said no. So I rejections and I.
How many of the companies are still still around?
Some of them are. Yeah.
Some of them you wouldn't want to work for.
But I sometimes run into people and one guy who started private equity private equity fund Afron. I remembered his name at the bottom of the letter.
Wow.
So I was sitting meeting I said you do realize that he rejected me in 1992.
That's great.
And I was an adviser to a company. I don't hold grudges.
I didn't hold any grudges. I'm glad I have to say thank you to all of them, right?
Yeah, of course.
God forbid I'd gone to work for someone.
Okay. Where did you where did you end where did you end up?
I ended up at Fidelity Investments right out of business school. And even there, I got rejected from six people I wrote to in the company. Thankfully, they had no common HR system or whatever system. So, the seventh guy hired me.
Great. This is a great system.
Her resume looks interesting. We should talk to her.
He couldn't tell whether my name's male or female.
Oh, sure. Sure.
I signed up Fidelity. And when I was when I was business school, Yeah. I was applying, I'd get phone calls like Nor Eastern, so I get a call. Hey. Um, so we're just double-checking. Uh, you know, how was your time in Northwestern? Why did you say Boston? I'm like, that's noraster. Oh, I'm so sorry. I've got another call. I got the exact same thing. I went to Northeastern. Same thing. I'm not going to correct you.
Keep going. So, I had all kinds of But one of the calls told me, yeah, you don't have enough finance on your resume to get a job on Wall Street. So, I went back to school while I was working at Fidelity. I got a masters in finance. I got a CFA and I was teaching a CFA class in 1995 96 actually 96 October to do portfolio hedging and [__] and this guy sitting in front of me said oh you work at Fidelity I'm like yeah like hey do you know all these people like no so they they're on the fund management side I'm like I don't work there I'm like corporate finance do he's like wait you're teaching me CFA level three and you work in corporate finance I said you want to pass the exam or you want to discuss my credentials and To his credit, the next day I interviewed a partner.
There you go.
So I finally went to work in money management for two years and most interesting time, most boring time.
Yeah.
I just couldn't sit.
Yeah. 97 98 99.
So we're we're in the internet boom. We're like internet boom.
Henry blogger telling us that AO is going to be the biggest company in the world. Right.
Yeah.
So I did that for two years. Did well there got bored left and I started uh one of the CEOs I used to cover telecoms that time. one of the CEOs of the CEO of Deutsches.com said come work with me. So I took my bags through flew to Germany to bond and worked with him for 5 years.
I started a mobile data startup at that point in time and the name of the company that you started there it's called T-Motion.
T-Motion but that that was a time Deutsch telecom I worked in the team that acquired voice stream which is now T-Mobile USA.
Yeah.
So we did that. I worked there for four or five years and then I quit. I was tired of commuting from London to Germany and back as my 30s and I was sitting a friend of mine walked up to me and say, "Hey, I this head hunter calling me. There's a job. Um, it's a company from the US. They just went public in some reverse Dutch auction type scenario. That job's too small for me. Do you want to go interview?"
Yeah. The guy was the CEO of T-Mobile UK.
So, that was it. I met I met uh then guy.
