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Get started today. Great show yesterday. We put the timeline in turmoil with the MongoDB debate around the responsibility of the CEO. I thought it was a really fantastic conversation. I came away like, wow, this is like an unfortunate situation, but a lot of cause for optimism.
Yeah. And I think he summed it up well without going too aggressive, but you know, pass the information through.
Exactly. Exactly. And I saw a lot of love for the clip. I saw a lot of people quoting the clip and saying like, oh yes, like okay, this confirms what my position was beforehand. So I thought that was cool.
This confirms my pre-existing.
Thank you for confirming what I already believe.
Yeah. The timeline was also in turmoil over Coastal Ventures' cognition factory. We can go into that. There was one interesting thing that happened on the show yesterday that I didn't really... I started thinking about after the show ended. So our first two guests were from Nvidia and Coreweave, and obviously those two companies work really closely together, and the conversations were sort of different. We were talking about security with Nvidia, and then Coreweave, of course, we're interviewing the CEO. So we're talking about the business overall and their transition from a rent-a-GPU company to more of a full AI cloud. They'll rent you everything you need.
And it was interesting because I was remembering that it was just like last year that Nvidia was like, we're going to layer Coreweave, or we're going to layer all the Neoclouds. We're going to be the front door to compute with DGX Cloud Lepton. I don't know if you remember any of this, but this started back in like 2023 post the ChatGPT moment. Jensen comes out on stage at one of the keynotes he gives and he says like, this is the iPhone moment and we're going to aggregate all of the underlying compute and you're going to be able to come to us and deploy whatever resources you are and we're going to compete with like AWS and Azure and GCP and we're going to be a one-stop shop for this stuff and it's going to be really important.
And at the time, I feel like people were sort of like, whoa, okay, this is bold, but this could be really, really powerful. Because they have this odd tension between the Neoclouds, where if you go in, you lose your connection to your customer effectively, and the margins could get compressed. You're in a much more competitive environment. And at the same time, if you don't go in, then Nvidia can just say, hey, like you know, all the DGX Cloud Lepton customers, well we're going to send them to the clouds that did sign up. And so you have this like tension. It really did feel like Nvidia had some leverage, biggest company in the world very shortly after, and obviously a very aggressive business, like they're not just going to be like, oh, that would be improper to compete.
But it played out very differently, and Nvidia has become very friendly with Coreweave, and they both found their places where there's still a little competition here and there. But I was just reflecting on how that journey came together, where that landed. And the long story short is that the DGX product came out and the reviews weren't like, okay, yeah, this is actually better than working with Coreweave. And there were still so many benefits from going to a Neocloud or even a true cloud provider. There was just more to do.
Nvidia made an acquisition. They bought Lepton, where the name came from, in April 2025, which sort of kicked most of that discourse off. The rumor was that they paid between 300 and 900 million dollars for that. And Jensen was so gassed up on this. I loved his quote. He said, 'Nvidia DGX Cloud Lepton connects our network of global GPU cloud providers with AI developers together with our NCPs, which is Nvidia Cloud Providers. We're building a planetary-scale AI factory.' That's what his tagline was. Which makes sense, like there is a world where that would have played out. That's not...
One second. Talk about how we have failed so far to convince a lot of our friends not to call supercomputers AI factories.
If we continue to fail, they're going to be like, it's a refinery. It's an AI offshore derrick. It's an oil derrick for AI.
Like, it's a chemical plant. Yeah. For AI.
For AI. Yeah. It's exactly what you want in your community. For sure. Yeah.
The risk of total failure in your backyard is low, but non-zero.
Non-zero. And yeah, and then you have another person who's like, wait, why did you say that?
Yeah. Ridiculous. I want to go back to supercomputers. We'll make it happen eventually.
Gabe says, it's a data ranch, brother.
Putting a data ranch in your backyard.
Yeah. But yeah, I mean at the time there was a bunch of reporting sort of like people familiar with the matter, The Information got a scoop from a bunch of the Neocloud compute providers saying like Lepton was a potential competitive threat and if you refuse to participate that creates a risk that Nvidia could direct workloads toward competitors. And it was a bit of this tense time, but the end result was more balanced.
So instead of layering their customers and trying to control aggregate demand, which would be really powerful if it happened, the product evolved into this unified AI platform, which is their words, but basically it's between an actual like Expedia for GPUs and just a set of standards. So it's a bunch of proprietary software. It is sort of what makes up the CUDA moat. So everything from handling GPU node groups, interactive dev pods, distributed batch jobs, inference endpoints, storage, observability, reservations, more. So all the things that you need to actually schedule, manage GPUs, you can run that, but you can still use your own hardware, do whatever you need to have the relationship with the underlying owner of the GPUs. And so the rest of the Neoclouds are generally like, you know, pretty safe.
And so it was interesting because it was heralded as this like, oh, okay, things could get spicy. You could see all the Neoclouds like really chirping at Jensen. Jensen really coming for the throat. Didn't really play out that way. But it does sort of go to show that Jensen does not take lightly to any whispers that the CUDA moat is going away anytime soon. Like he's like the ace is still up the sleeve in my opinion. Like they still have to do a lot of work because when SemiAnalysis actually like demoed it, they were like, ah, it's not working as well as some of the other systems. Like if you were to put, I don't even know if Nvidia Cloud Lepton is on ClusterMax, but at the time that they tested it, they were like, yeah, you're going to have a better experience if you just go direct Coreweave, Nebius, the other ones that are in the platinum tier.
Yeah, and overall, I think in many ways we've seen it's been very strategic to work with 50, 100 really, really, really smart teams that are going to have their own incentives to grow their businesses, grow their buying of Nvidia.
Yeah. And if you just use the framework of like who was upset yesterday about Coreweave launching their, what was the actual product called? Coreweave Forge, which is their like AI cloud, right? So they're just saying, hey, we got CPUs now, we got storage, we got tools to manage all of that. Who's really mad? It's like it's only their direct competitors basically who are like, ah, now we got to catch up. If you're a CPU seller or you're a compute, a storage seller or something like that, you're like, great, I got a new customer. I'm happy. And then if you're a customer of Coreweave, you're like, okay, I'm happy. I get more stuff.
And so yesterday's Coreweave move was not particularly a shot across the bow to anyone other than just like, hey, we know we're in a race with like 300 other Neoclouds. You see them on ClusterMax. We're going to do more to reach that diamond tier, which is what you proposed. But yeah, really, really remarkable margin expansion story. I mean, the depreciation story, like they beat the depreciation allegations pretty quickly, but that value of like dollar per watt is increasing really, really quickly. And so if they can get in line with the Elon and Jensen 60 billion a gigawatt, it's going to be a very, very exciting business. It already is an exciting business, but it was a fun conversation and that's what my wheels were turning about yesterday.
Let me tell you about Console. Console builds agents that automate 70% of IT, HR, and finance support, giving employees instant resolution for access requests and password resets. Let's go over to the timeline. You...
Anything going on yesterday?
You said you wanted to get in the mud and wrestle with pigs even though the pig likes it and you get muddy.
What are we wrestling about today? Yeah, so we kind of caught some of this live at the beginning of the show yesterday, but the post kept flowing yesterday. What really got people up in arms was Venode coming in and saying, you are a struggling second-tier competitor that is more unethical and lying just because you have no decency or sense of proper behavior and shows your desperation. Straight out lying about if Chris being fired, I thought would be below even you, just like the most crashing out on Matan's personal crash out.
So crash out on crash out violence.
It only took about 20 seconds for people to put it together that Coastal Ventures is of course an investor in Factory and Cognition.
And like a pretty big one, right?
But is funny enough an example that like venture firms can have firewalls and individual people that have exposure to one company that might want to get involved with another company can still behave in a way that is ultimately like ethical.
I'm not saying that Venode, you know, attacking his portfolio is, but...
Yeah. Was Keith still at FF when Cognition, when they did Cognition? I think he might have already been at Kleiner potentially then. And so I think Keith might be the Factory board member or something. I don't know. I just saw Keith coming to Matan's defense.
Yeah. Right. Which is obviously the Coastal Ventures divide, but that's the nature of these partnerships.
Sort of, he sort of cleared that Venode's not using AI for these posts.
Totally. All over the place grammatically.
You are a competitor that is more unethical and lying. That's not right.
This was firing from the hip. He's down here just, but he's got to lay it down. He's got to lay it down. I mean, what this really could say is that even though you have an economic incentive to align with this person, you need to distance yourself from them because you know that they are in the wrong. Like that's like the fact that Venode has bags here and he's still posting this makes it more severe, right? Like...
Yeah, but I think it's... I think there is a chance that Venode kind of forgot that he had exposure.
I think you got to put that at like 15%.
I just feel like, yeah, I forgot. Is that possible? I don't know. I don't know. I mean, he's a multi-billionaire. The economic...
I mean he was coming here, he came on the show last week to talk about...
He's clearly working more closely with another...
I like that. I would sign up for that. But yeah, he's clearly like on the board of that company and not on the board of Factory because the really crazy thing is like how did this go straight on the timeline? Like this should have been a text message and maybe it was, but you're only talking about two and a half hours. I feel like if a portfolio founder is out of control, you would text them and say, hey, you are in the wrong. You're about to get smoked. You don't have the leverage here. Like you would say, hey, look, you're a second-tier competitor and you're being unethical and you're lying, so I think you should take the post down and apologize. You know, you would say that behind closed doors. You would text that. You would not just go straight to the truth nuke from outer space, which is what Venode did.
Well, I don't even think it's necessarily, I wouldn't call it a truth nuke because it's an ad hominem. Like, he just went directly at him. He didn't even talk about any of the facts.
Well, so here's the thing. So Luke Metro...
If he knows the facts are true...
And we don't disagree that it's a nuke. Correct.
It's definitely a nuke. The question is, is it a truth nuke or is it an ad hominem nuke? And I think it might be a truth nuke because I think as an investor you might actually know the truth of what happened. You might know because he could go into like the internal Coastal Slack or something and say like, who are the board members? Is this guy actually a board member? You know, like what files have been shared from Factory to our board? Oh, nothing relevant that would be useful to Cognition. You know, he could have made that decision.
What are you calling it, Tyler? Ad hom.
Okay, it's an ad hom. We'll leave it there. I think we closed that out. But so Luke Metro said what I think everyone was thinking. Can we please not start Cognition versus Factory before we get a resolution to Rippling versus Deel? Great post. That being said, wildly different situation than Rippling versus Deel. When the Rippling Deel drama broke, there was immediately...
Insane, seemingly insane smoking guns.
That are getting worked out through the court system. But it was like Rippling had basically like tricked Deel in some ways, right?
Wait, really? Oh, I don't remember that at all.
I mean, it's sort of fuzzy at this point.
It was like a honeypot operation. That is sort of a trick. That's sort of tricky. Okay. Yeah.
Well, yeah, honeypot is better.
I think that was like their term, right? They put the honeypot in this. My current read is that the CRO, you know, the advisor goes to Matan and says, I'm getting poached. And Matan says, you can't get poached. You're being fired for unethical conduct. But the firing happened days after he was notified that he was leaving for a competitor.
And Keith said it is unethical per se to even interview at a competitor while attending board meetings and board dinners. And I read this and I was like, yeah, I think that's right. I think I agree with that. But then I was thinking about like how would he have done this more responsibly if that's what happened? And I was like, so you have to resign because you think that you should go interview at a competitor and then reach out to them. And it doesn't seem like that's the way things happen that often. I don't know.
People like even direct competitors will maintain, you know, somewhat jovial interactions. Oh, how's it going? Oh, it's going great. Yeah, cool, man. Like, and both parties are kind of just saying nothing, but you are having like a conversation technically because you like bump into someone at a conference. You might both be on stage at the same part talking about agentic AI or something. I don't know.
And then I was thinking about like how does this rank if the new Cognition CRO, I forget his name, was on the... Chris Deng, you know, if Chris Deng was on the... he was a board observer or board advisor. What's the terminology?
I think his only, from what I understand, his only technical title was advisor.
Advisor. Okay. So I'm just thinking like back to your original frame of like is this more or less hardcore than before? And I'm thinking about like the Steve Jobs and Eric Schmidt interaction where like Eric Schmidt is on the board of Apple and being like, we're buying Android over at Google. We're launching Android over at Google. And Steve Jobs gets pissed.
But it doesn't spell out on the timeline.
So that's where Steve Jobs...
Another comp is like Mike Krieger.
His involvement with Figma.
And resigned from the board I think a couple days, like a day before launching a competitor.
So again, this stuff has been happening. But the funny thing is to see this like whole all this drama around companies that provide basically enterprise applications.
Mhm. When you look at what's happening on the research side where constant aggressive poaching around like truly like companies developing truly novel IP that basically have no protections where you can work at a company for 5 years, learn a bunch about what they do, get poached and bring all of that know-how over to a new company within the same 24-hour period, right? And so I just don't... this whole situation like an advisor that gets poached doesn't feel like a big deal at all to me in the context of everything else that's been happening.
Like and ultimately I don't think, I think the story is like over. Like I think it's...
No, I think you're right. It's different because like the researchers do post but they don't have like as many interactions with VCs. So like there's that back and forth about the three OpenAI researchers who were just fired according to the Wall Street Journal for sharing information, but like that doesn't reach the level of like board interaction, right? So you're not going to see board members, at least that I can tell, like doing drama about it. And even when the talent wars happen between Meta and OpenAI, like we were the ones that were posting the most like spicy stuff about it, right? Because like the board members, they don't necessarily have the same level of interaction with the researchers as the other board advisors. Yeah. And so I think this just gets a lot more personal, I think. Anyway, you want to close the book on this?
Miles says, I work with the end of the trough.
Let's do it.
Miles says, I work with a company that's doing great by all definitions. Recently, one of its star executives was poached by an A+ company to lead a very popular product. Founders tried to retain him. They couldn't, so they wished him well and began the recruitment process to replace him. The investors sent him notes thanking him for all his work. No temper tantrums or ethics debates or Twitter name dragging. Just grown-ups get back to work. And Martin over at A16Z says, boring.
Yeah, but that's kind of what Miles is advocating for. He's like, these types of interactions should be boring, right? So, I don't know. That's reasonable. Sean Maguire says, nice one from the cheap seats. You know, 1% of the story. And Sean's really like teasing something. He's like, there's going to be the files. There's going to be some crazy drop. There's going to be another truth nuke. It's going to be truth World War II. Something like that.
But has he actually posted anything? Like it feels like today is the day to like share the truth.
I hope everyone can sort it out behind the scenes.
Yeah, I don't know. Yeah, he said he has a nuclear weapon and yeah, that's a truth nuke. He has a truth nuke. That's what he's saying. A nuclear weapon on the timeline. But he did come out and say Cognition is Infosys masquerading as Anthropic. And then which is funny because Infosys does like technology IT transformation which is in many ways what Cognition does. But the only thing I would disagree with Sean on is I don't see Cognition like masquerading as Anthropic.
No, not at all. You talked to Scott Wu and he was like, yeah, we're providing enterprise value, automating code generation and business.
Yeah. Yeah. It's not an Anthropic lab at all over there. I mean, like they take their business seriously, but that's not a uniquely Anthropic.
Well, and also this would tell me that Factory and Cognition are going in very different directions. He thinks the Infosys direction is bad and hopefully they can go in different directions.
And maybe they could even work together at some point.
Ooh. Oh, okay. Yeah. And maybe you don't need the Snowflake CRO if you have discovered some fundamental thing, right? Like the whole tease was like we did something on the research side, but like that doesn't matter if your CRO leaves, right?
Hopefully he doesn't even understand it. He doesn't even understand what's going on in the research department. He's like, I don't know. There's a bunch of mumbo jumbo. Just tell me who to call and sell it to.
I don't know. Anyway, let me tell you about Shopify. Shopify is the commerce platform that grows with your business, lets you sell in seconds online, in store, on mobile, on social, on marketplaces, and now with AI agents. Moving on. What's next?
Bunch of people got slop ads from Instinct. They're upset. I'm put helmet. But I would clarify. I don't think they're... I would be shocked if they're actually monetizing this already. Seems like it was just an experiment, right?
Can we suggest products that people will want to buy because it would be a big...
I think everybody that Noah has been very explicit that they plan to do this, right? They plan to get deals with different retailers and platforms and be able to monetize the purchases that they draw. Now, something I've always said or at least said a lot in the last month or so is that if you want to get to the point where you can have meaningful take rates, you need to be driving net new demand. Right? So, if I go to my personal agent and say, buy me this thing, right? The demand was created elsewhere, like it was generated with like advertisement or organic content or something caused me to want to go and buy it. And brands are not going to be standing up and lining up to pay big referral fees effectively when they already paid to create the demand elsewhere.
And so this Instinct test is, hey, we have a... we understand this person. Let's basically suggest some products that they maybe weren't thinking about but they would buy.
Or some sunscreen. I just like I saw like 12 different screenshots that were all power banks and it's like it is sort of universal like if you were going to just blast that. I mean yeah, we talked to the CEO at The Ridge and he's like yeah they just move like it's a good business but I don't know. So we got to just figure out like are they actually monetizing this? Because Instinct is in a position where you could literally just go and set up an Amazon referral fee thing and start taking a cut. And websites have done that for a long time. Like if you go to The Wirecutter, now owned by The New York Times, you will be able to click on check out for a suitcase, for some sunglasses, for the best TV they have. And if you click on one of their partner sites, it puts a cookie there. And when you check out, they actually do make a referral commission. I would be surprised if Instinct wasn't monetizing that.
But at the same time, I think they might not even need to because the scale of what they're trying to do is more just like understand the consumer and then have the next proof point for the next raise because obviously it's incredibly compute intensive. They're growing very quickly. They're going to be raising very quickly. And being able to go back to the next round of VCs and say, hey, we've actually tested e-commerce and it converts at seven times the rate of Instagram or whatever. And it's like, we have this much surface area and here's the response. And yes, there was a lot of feedback that was like, oh, this is slop. Who said it's shop slop or whatever?
Shop slop. Dave Morin called it from OpenClaw.
Yeah. Somewhat biased, right? He's running the foundation.
You know is like basically own your compute, own your agent.
Don't get ads pushed to you. Have your agent be aligned to you. That's their stance.
I think that overall here's the thing. Here's the thing.
If they can actually give you a 10 out of 10 recommendation, people will love it, right? Like when someone recommends you a product and you're just instantly like, yes, this is great.
That's a wonderful experience. The question is how quickly...
How quickly can they get there? It didn't really feel like they were nailing it, but we don't know. Like maybe people are sharing screenshots. Like one of these was pretty cool. It was they found like some Rothy loafers which are...
They generally sell out. They're kind of hard to find.
This person didn't like it, but I think a lot of people would be like, cool, thank you.
You're like, this is the worst thing ever. And then you see one thing and you're like, okay, I'm sold.
No. The one that I saw that I thought was funny was Instinct knew that this guy had a 911 target.
Because they'd worked on some insurance stuff.
But the issue is that Instinct was like basically clocked like, okay, this guy's a car guy. I got to hit him with a bunch of car stuff. Then it recommends a trickle charger, which 911s really don't need, especially modern 911s, and an indoor cover.
To use inside your garage.
Which car guys I know would never use an indoor cover because...
I said this yesterday briefly at the end of the show, but because if you have any sort of the basically like the cover against the paint can cause more damage than it just like sitting there, right? So you generally want it out of the sun, but you're better off just like leaving it. Especially because if there can be any debris between the cover and the paint, you get even more wear.
But you can imagine how it knows about the user, but it doesn't know about what car people actually want, right? And so they can probably get better.
They could recommend like a straight pipe exhaust system or under lighting or something that a car guy would want for their target, right?
Yes. Yeah. Or spinners as you always say.
Spinners or even just knobby off-road tires, an off-road kit, something like that.
Yeah, with the shop slop screenshot here from Dave Morin, what sticks out to me is the fact that there's like five let's buy this buttons. I don't know. Like this seems like a normal e-commerce site, but the repetition there of all the calls to action is what's throwing me off and making this look sloppy. I don't know if that's what's triggering me, but the actual recommendations there of a couple things.
Well, it's funny because this was always a historical concern with AI ads is the AI that you trust for information and to help you do things suddenly is like, come on, let's buy this, you know, let's buy this, what do you think, should we buy this, right? And it ends up feeling a little pushy. The other thing that stands out is they've taken a very UI-light approach, right? Noah has said you don't need new interfaces, you know, it has a computer, it has a phone number, it has a number that you can text, but I feel like they're going to need to, they have to make interfaces, right? And this is one of the first.
And then yeah. Again, the challenge is like getting pushed products in text is just very, very personal.
And I think that a lot of e-commerce brands, you know, will use text marketing. I find that I'm like a thousand times more likely to unsubscribe from text marketing than I am from email marketing, right?
Well yeah, I mean it can be dangerous to operate on the previous era of like text message conversion rates and open rates because we have moved into a regime where my iMessage at least, probably yours as well, has a number of folders for unknown senders, promotions, spam, transactions, and if it starts flagging Instinct or your AI agent not as a friend but as a promotions vehicle, it goes in that bucket and then the open rate goes way down. And this is what happened with like the newsletter apocalypse and Gmail where you got filtered off into a different section. You're not actually in the inbox anymore. And so that's pretty risky.
I was demoing Dot yesterday and just had a phone call with it on the way home and was shopping and said like, go find this pair of pants that I bought in my Gmail. Go find another pair in like a slightly different color. And it was hunting around and it was just like, nothing's in stock in your size, bro. And I was like, is there some like global pants outage or something? What's going on? And it was like, no, this isn't like a conspiracy or something. But I was actually like kind of laughing back and forth.
Crazy. They're crazy. It was a pretty delightful experience. But my end result was like, I don't want you just to send me random stuff, but I do actually want you to check on this. So, go create a background task to check every day for this pair of pants and then just let me know if they come back and stop. And it's like, I'm expecting one notification sometime in the next few months for that particular pair of pants and then I can just be like, get it. Okay. Yeah. But anyways, closing this segment out.
