¶ Intro / Opening
You're watching TBPN. Today is Tuesday, 06/09/2026, and we are live from the TBPN UltraGome. 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. We have a special guest today. RJ from Rivian is coming on. It's the launch of the r two today.
It's also WWDC. It's also Anthropic launched Mythos or Fable. Fable's the main consumer model, but Mythos, there's some details about that as well. More for cybersecurity. And
China's waking up.
China is waking up right on schedule.
The AI $22,795,000,000,000 infrastructure fund of sorts. That They're working on. That And we have Chris Miller.
Competitive. Yes. Have Chris
Miller joining joining.
That feels like right in scope with the capital that's been deployed into the big labs, you know. Maybe if you total up NVIDIA and Google and Microsoft, you get You got a kind or CapEx. But, you know, it's certainly in the game. It's not France. Right? Yeah. It's it's a it's a big number and it's definitely France. Yeah. It's serious money, so we're gonna dive into that. Tim Cook took his last bow at Apple's showcase event.
¶ WWDC Day 1
This is history on the front page of the Wall Street Journal. Yeah. He needs a 21 gun salute. A 21 I AirPod salute where you throw him into the wall.
Or a 21 nuke.
21 nuke. Really? I don't think so. I think the stock's gonna do great. So this is this is actually fascinating. So the focus of Tim Cook's last WWC was Siri and reviews are good. They launched a bunch of new features. I think people are gonna be very satisfied with it and all the decisions that they made. Did you know Tim Cook's first WWDC was when they announced Siri the first time, 2011? Woah.
So we can play this clip from Full circle. The first Apple Siri announcement. Listen to what they actually say, how they talk about Siri, and then look at where we are today just sixteen years later, fifteen years That
you're gonna be able to talk to technology and it'll do things for us. Haven't we seen this before over and over? But it never comes true.
They have very limited capability. It's crazy.
Just learn a syntax. Call a name, dial a number, play a song. It is such a letdown. What we really want to do is just talk to our device, ask a simple question, what's the weather going be like today and get a response. In fact, we don't want to be told how to talk to it, we want to talk to it any way we'd like.
Someone else might ask, will it rain in Cupertino or is the weather going to get worse today or do I need an umbrella today? And your device, in this case your phone, will figure out what you mean and help you get what you want done. That's a feature in the iPhone four s we call Siri. Siri is your intelligent assistant that helps you get things done just by asking.
Pretty crazy. Called it.
What happened?
But it just took fifteen years for the technology to actually catch up. And so I think they they launched a, you know, a functionality. When Siri launched, it was the best voice assistant. It was great experience. You didn't have to
know the setbacks. But it was cool. Years for their technology to catch up.
Yes. But it took thirteen years or twelve years for the technology industry to catch up. And so they're only 10 behind if you look at it that way. Like, it's been a fifteen year project from that announcement. It's been twelve years for the leading labs to get there.
And so they're three years behind. Feels like an eternity in AI world. Yeah. But it's really only 10%, 10% slower and they wanted to do it their way and and they got there. It is very interesting to me that they're calling it Siri AI because Siri, the whole pitch was AI and like Siri, the name Siri comes from SRI International which was the Stanford Research Institute and it's from SRI International Artificial Intelligence Center.
Like these were Stanford AI researchers who started this company in like 2008 or something like that and grew it and then eventually sold it to Apple as Siri Inc. Acquired October initially released 10/04/2011, fourteen years ago. Maybe fifteen years ago. They might need or I guess fourteen. It's gonna be fifty it's gonna be the fifteen year anniversary in a couple months.
But do you know what happened the day after 10/04/2011, the let's talk iPhone WWDC where they announced Siri? Steve Tim Cook was the first this was his first WWDC as CEO. He obviously hands it off to his colleague to introduce Siri. Steve Jobs passed away the next day. Pretty crazy.
And so you have this book ending of Siri on both sides of Tim Cook's career where sort of nothing happened in an interesting way, you know? But it but the stock did fantastically well. His Tim Cook created an immense amount of value but it was this lighter, cheaper, faster, stronger. Look at the stock price. Look at
the No.
I'm I'm not that
in a in a negative way.
I'm just But So so so you have like Tim Cook operationalizing the company, making so much money from the App Store, building the business. But at the same time, he just happened to be the CEO during the greatest AI winter ever, basically
Yeah.
From 2011 to '20 to 2022, 2023 when we started getting LLMs, started getting chatbots. And it did take them a few years because they had lived through a decade of like, okay. So the Siri team, have you guys got it better? And they're like, not yet. The technology is not moving fast enough.
Like, we haven't invented anything new. So we are the best of a very mediocre category. And Siri sort of slowly fell behind. But even when people say even even if you go back to 2019, pre chat GPT, pre AI, pre LLMs, and you ask the question of, like, is Siri good? People would say, nah. It's not really delivering in the promise of like talk to your phone, it does whatever. Like people have the idea of the the c three p o, the agentic computer.
Yeah.
It's not delivering there. But it's not like people were switching in droves to Android because Google Assistant Had a better voice system. Or Alexa was so much better. Alexa was the same system. I'm sorry.
I'm triggering a whole bunch of smart home devices. You're triggering every So during the keynote for at WWC, they whenever the keyword s I r I was mentioned, they took out the four kilohertz, six kilohertz, a few different spaces so it wouldn't trigger the at home devices. So they basically, in the recording, nerfed it so it wouldn't fire off your your smart device, which I thought was cool cool, like technical solution to that problem. Anyway, so they were like sort of behind, but it didn't really matter because they wouldn't well, they weren't getting their lunch eaten until the dawn of the LLM, the dawn of the chat app, ChatGPT and other apps that came out and became like super powered relative to Siri's capabilities. Today, they're catching up.
And it's a very interesting bookend on this on the the Tim Cook era at Apple, where he was incredibly effective, but the technology was just not in a it was not at an inflection point at any time during his career basically until the very, very end. And yeah, they got, you know, they were a little bit behind the ball. But ultimately, they did catch up. So there are a bunch of interesting other things in here. The facts first we should go through.
So Apple spent roughly twelve minutes yesterday detailing the expansion of its child safety and parental control features. This was interesting because it was a notably short keynote. It wasn't a particularly long keynote. I think they spent like fifteen minutes talking about products and then twelve minutes on parental features. Sort of gives you an idea of where the energy, where the the focus is, where they want
to Yeah. Spend potentially what you were saying yesterday, think people Yep. More and more people are waking up to maybe phones are causing systemic issues Yes. In society. Yes. Brain rock. Get ahead of that.
Utility stuff. And so that's what I wrote about today in the TBPN newsletter. So quick on the facts. Child accounts with built in age protections like limiting adult websites and showing age appropriate media, good. Ask to browse which asks for the parents' approval before the visit before the child can visit a new website.
So any so the child can say, hey, got to go to this website for my homework, click a button and it sends a notification to the parent's phone and they approve and they say, yeah, that's fine. So you can really lock it down. Communication controls allow parents to manage who their child talks to and will ask for confirmation before their child can add a new contact. Apple also unveiled a new photo editing tool. This is separate, but spatial reframing.
So if you don't like the angle of the photo you were taking, you took it over this way, you can, with AI, reframe it so that it's more straight on. This is a very cool feature. I think this is awesome for a few reasons. One is that it doesn't feel like full gen AI to me where it's like gonna slop it up. It's more just like a nice feature that's in the actual camera app photo roll, camera roll.
I thought that was cool. And also this doesn't feel like, oh yeah, this is something that every that there was already a startup doing and it was already baked into Instagram and so Apple's just rolling it out and they're like behind the ball. This feels like the first time I've seen this. It seems really obvious. You could probably one shot this in images or Nano Banana or any of the image models.
But it was cool and it wasn't like, oh, yeah. This is a startup and they're just like rolling it in. This feels like Apple's DNA of like understanding the technologies and then doing something cool with it and unique was on display here. So I thought it was cool. Was interesting. Yeah. Sorry. Yeah.
I think some of the pushback is that a lot of this kind of functionality had been available in other apps, like post production apps. Mhmm. And now bringing this basically bringing it into effectively the realm of the camera Sure. Where the computer is now the camera. Okay. It feel it does it does feel notable to me.
But but it's notable how? Like push back? Because there was push back, which was interesting. People were saying that like, this is too much AI.
Like, I just view this I just view this as a as a camera. It's
a camera.
Yeah. This is a way to capture reality. Sure. And now, in the reality capture device, you can Yeah. Use AI Yeah. To
So Apple has long prided themselves on like what you see is what you get in the camera app. But that started to change with the artificial depth of field, the tone mapping that happens. Yeah. There's a lot of things that you can do.
Yeah. There's a lot of like upscaling. And sometimes you see images, people are like, oh, that's AI, it's actually just upscaled to Apple image.
Yeah. Yeah. Especially if it's low light noisy image, it'll clean all that up. I think it's fine. I you could just not do it if you want to not have your photos reframed.
But it was interesting seeing that that there's a lot of folks that do land in that camp of Apple is the, is not going too hard into AI. They're not stuffing AI everywhere and then here's a feature that feels very on the nose in terms of AI. We'll see. We'll see. And there's mixed feelings on the timeline about spatial reframing with some calling it one of Apple's most exciting AI features while others are expressing concern about the detection, direction AI generated imaging is headed.
Because you can, I mean, Apple's been mediocre at like the remove trash in the background feature like Gemini or I guess Android AI, like the AI camera on Android devices have been smoking them there? They're probably gonna get better at that. But pretty soon it's like you take the photo in super low light, it up ress it, camera filter, color grade, spatial reframing, remove everyone else and you get a totally different photo. And I I I think that's fine. I I don't have a problem with that.
But like I understand why people would be like
I mean, it's a little bit strange because
the normal photo. Just turn off all these
features. At least yeah. No. And it Like,
it's an option.
You know? You can
always pull it into Photoshop and just do whatever you want
with it.
Yeah. It it'll just be interesting
Put a dinosaur.
We're gonna enter an era
Yeah.
Where people's memories of of their lived experience are different than
The Joe Weisenthal view of the future. Joe Weisenthal got in some hot water because he said that, why do you need to store any photos in the cloud when you could just them all and then on like, show me a photo of my kid riding a dinosaur when he was five. And it just shows you a photo of that. And people are like, that is not the world I wanna live in, Joe. It's very funny.
Yeah. We're just not that far off from, hey, Siri, your phone's in your pocket. Yeah. And you just have your AirPods in. You say, hey, Siri, make sure to generate some images of of my time at Disneyland today. Okay. Yeah. It's gonna happen.
For certain people. That's their option. Let them let them do whatever they want, you know. You can you can go to Disneyland and you can say, I'm going to make a I'm gonna print out a photo of a stock photo from Disneyland. You can do that. It's weird. I don't I don't know why you'd wanna do that. Take a photo of yourself or your family. But you could. You can go get a professional photo taken at Disneyland. Pay for it. You can take one with your phone. You can bring a professional camera.
You can have somebody
You can
have sketch artist. Yeah. Exactly. Like these are all just options. I don't know. I don't have a problem with it. But Yeah. People do have a problem with it in the context of their kids because they want control and they want and they want to be the decider of those options. They don't want the kids making the decisions because the kids are going to say, Max Brain Rod, please. And so that's what's going on with the parental security thing and parental privacy.
So I I am interested to see what's gonna happen on Instagram. Yeah. And if there ends up being divide between accounts that that are constantly getting the tag, like the AI tag on them. Oh, yeah. And people that just say like, nope. No AI ever. Yeah. And and I think I think there'll be a pretty clear split.
Yeah. And and and when do you apply that tag? Little spatial reframe?
No. I think Instagram tag, I think they do the tagging.
But would they for a color grade? Would they cut have
to figure out what the line is. But to
To me me, me, the spatial spatial reframing reframing say, make it black and white, does that count?
Spatial reframing is slightly because it's capturing a picture that never existed. Whereas a filter is just sort of like enhancing color.
You know, it's kind of just separating the layers, rearranging them. I don't know. It it it's it's clearly like a blurry line. Yeah. But but it's the blurriest we ever see.
But we could use it less blurred.
Yeah. Good. And that's literally what they do because you can see that the the rest of the space is sort of blurry and then it puts together. Tyler, what do you think about this?
Yeah. I was just saying I I was kind of surprised that they didn't release more like AI detection
kind
features
Oh, yeah.
Around this. Like, I I would imagine that I like I assume there will be some metadata if you do the reframing that says that it Yeah. Used the reframing True. But it's like
Yeah.
That's true. Yeah.
Yeah. Easy. But, yeah. I I I would be interested. I mean, could have leaned into that more.
They could do like, hey, when someone sends you a photo in iMessage, we will add that tag. That tag's being added on x and Instagram, like Apple could easily roll that out and that seems like a consumer friendly thing. It seems like there's demand for the AI tag even though I think it's kind of silly because you can get around it and what is AI. But interesting. Anyway, so this was my wildcard topic yesterday.
Maybe they'll talk about something related to the fertility crisis or something and this feels like three steps away from it, but I like the direction that they went for a few reasons. So we got a bunch of new AI features, especially the new Siri. Technology and UI patterns are mature. We talked about this. So it's easy to for Apple to nail.
Also, as I predicted, they're giving Siri an app and the models are strong enough that I expect random hallucinations to be basically completely acceptable from a daily use perspective. But my wildcard was that something in the presentation loosely would link to the topic of the fertility crisis that Derek Thompson has been covering recently. There was that article in the Financial Times, are phones causing brain rot or problems like how do you address this? The correlation isn't perfect for sure. But there's enough evidence that reasonable people are start are starting to put phones in like the probably linked bucket of reasons why there's a modern fertility decline.
It's just one of them. I think Derek Thompson is like I think it's maybe 30% of the reason, something like that. But what's interesting here is that Apple is not a fear based marketing company. So their execs don't go on podcasts and make freewheeling proclamations about doom scenarios. They identified environmental concerns about fossil fuels and energy use early, like early, early.
And you cannot find a clip of Tim Cook talking about, like, climate apocalypse. We're all gonna die because the sea levels are gonna rise. That's not he wasn't saying that for years and then figured out how to do clean energy for Apple's data centers. That's not what they did. They just Yeah.
They just worked privately and then started talking about the solutions in their marketing materials. They didn't put the cart before the horse. And it seems like they're doing the same thing here with parental controls, phone addiction. Instead of giving a long speech about how bad endless scrolling can be and how it might lead to a less flourishing life down the road, they only talk about solutions, parental controls. Twelve minutes of content in a notably short keynote.
I think many parents are very hesitant to give kids smartphones these days, so it's also a good business reason to say, hey, you can buy your kid an iPhone because there are so many controls that you are fully in control. Know what's going to happen. You're safe with us. And there's already a whole niche market in these dumb phone devices for kids. There's this watch that has GPS and the ability to call home but not much else.
There's no screens. There's no social media. And so being proactive about building solutions and then only talking about the solutions is just extremely refreshing to me and I think it's a good move. Anyway, the timeline was in turmoil and we'll take you through it after I tell you about Cisco. Critical infrastructure for the AI era. Unlock seamless real time experiences and new value with Cisco. So we got Gruber versus Gurman, two of our best friends from the show. We love both of these The
Gurmanator versus the Gruber.
Gruber. It's rough. But we'll take you through it, what happened. So John Gruber and Mark Gurman through the timeline in turmoil over the rollout of Apple's new Siri integration strategy. Here's the play by play.
Citizen says again, this all sounds complicated. Just generate your kids.
Generate your kids. That's the real doom scenario. But you won't hear Apple talking about that, thankfully. That's the domain of of, you know, journalists and podcasters. Anyway, so back in March '20 03/26/2026, so four months ago, three months ago, Mark Gurman reported in Bloomberg that Apple plans to open up Siri to rival AI assistance in iOS 27 update.
And so that was the headline. He got some scoops, and he says the company is working on developing new tools to allow AI chatbot apps installed via the App Store to integrate with the Siri AI assistant. The chatbots also work with upcoming Siri app and other features in the Apple Intelligence platform. That means, for instance, if you have Gemini or Claude or ChatGPT installed, they'll be able to send those queries to those services within the Siri voice assistant just like they have been able to do with ChatGPT since Apple Intelligence launched in 2024. And so but as of yesterday, according to John Gruber, Apple has not fully announced exactly that, at least according to John Gruber who says, quote, maybe Apple ran out of time today and will announce this tomorrow.
Maybe they forgot to announce it. Maybe they scrapped the next generation Siri that existed two months ago and in the last month rebuilt an entirely new next generation Siri. I'll bet something like that is what happened. So he's taking shots. He's putting, he's putting Mark Gurman in the truth zone, But Gurman fired back and said, here are some screenshots of integrations that basically match his original reporting.
And so Gurman's saying, no, no. You can actually go. There's a model picker in the Siri app. You can configure Siri to work with other apps. But there's a deeper question here. I think they're sort of quibbling over like minor leaks and rumors and like the interpretation of these things. I actually think there's like enough of a gap here that it's not totally unreasonable for them but for both of their interpretations to be roughly correct. But
Someone in the x chat feels like I'm watching this in two x
Point five x buttons right there buddy. Point five x buttons right there. I actually don't know if it's on live stream.
This is great. This is this is a feature not a bug. Yeah. I'm sorry, Humble.
You get a warm up for Deli and every once in a while. Okay. Anyway, so
John's on a tear. Let him cook.
I think the core question is about expectations versus reality. There was some hope from hardcore AI users that the Siri button, me, the Siri button would be able to fully remap to their AI model of choice. So you're deeply integrated in ChatGPT and knows a bunch of things about you. You're confident with that model. You know what keywords to use when.
You have the integration set up. You press the Siri button and you wind up getting that model by default. Currently, have to say, hey, Siri. Go ask ChadGBT to do this for me. And then it gives you this little pop up with this button. You have to click Okay. Yeah. You're playing telephone. It's really yeah. You're playing telephone.
It's not good. And and so and then also there is a demand for the AI app that they have installed to get access to everything across iOS with roughly the same privileges as Siri. And is that announced? Not quite. And so this would be a big departure from the current flow where you specifically have to ask ChatGPT.
Now there are screenshots of a model picker drop down in the Siri app, but it's unclear if that resets on some regular cadence, like maybe every query or if it's a permanent change. And I'm sure I'm sure we'll learn more. Marques Brownlee had an interesting thing that they're calling what was it? Maybe like the new the new operating system is called Golden Gate. And he was saying that like the nominative determinism of calling something Golden Gate is like it's a Golden Gate in the sense that they are maintaining their gated walls, their walled garden and producing endless gold from mining what's inside the gates.
It could just be that they like San Francisco. I Well,
it's just one or the other.
As someone who as someone who loves nominative determinism, I thought it was a fun it was a fun take. Anyway, let me tell you about the New York Stock Exchange. I want to change the world, raise capital at the New York Stock Exchange. We're talking about reframing. And so the Brian McDuff shares exactly what's going on with the cleanup feature, drastically improved in iOS 27.
This feels like it might be Nano Banana under the hood or something fine tuned on that under the hood. It was very rough in iOS 26. There's also this interesting detail that I got more information on the private cloud. So the private cloud has been extended into Google Cloud. So for AFM, which is Apple Foundation Models, AFM3, this is the third iteration, AFM3 Cloud Pro, which is their reasoning model that's fine tune of Gemini or some trained on Gemini.
They say they worked with Google and Nvidia to extend private cloud compute, which they put a bunch of resources into securing and branding, into onto Nvidia GPUs in Google Cloud while maintaining the same guarantees to protect our user privacy. And so Apple's been very privacy forward. They have a ton of trust. People put everything on their iPhones. They're very, very confident in that.
And Apple's bringing that, but they're vending it into Google, which is like the advertiser, the the the dangerous one, the one that is listening to you. Not really. It's actually like Facebook that's more of like the listening one, but they're sort of extending their brand in. But what's interesting here is that Apple has made a ton of environmental claims, like our data centers run on renewable energy, but Google just did a deal with Colossus that does not run on on renewable energy. And so if the Apple, like, Google Cloud or Apple Cloud Pro model is running on Google Cloud NVIDIA chips that are actually a Colossus, you have an environmental concern there.
But Apple's never claimed that they don't rent servers from nonrenewable sources. They just say our data centers. And so it's probably something for them to work through over the long term. I would imagine if they're getting in this game long term, we would see some CapEx and some clean data centers, some environmentally neutral zero emissions data centers because that has always been a very key a key marketing point, a key strategy in Apple's rollout. So insane that this is the main image Apple is using to show off the new AI Siri.
Aga sent you a message about calathea. She described it as a patterned tropical house plant. Have you heard of calathea?
It's not summarizing anything. Yeah. This like the AI
Sometimes you don't need a summary. It should answer the question. Yeah. When
you see this
It should
you immediately understand that sent you a message Yeah.
About That's Calathea. That's very funny. 17 tropical houseplant. Yeah. The the demo should be Aga asked you about this tropical houseplant. Here's a picture of it. Have you seen this? That would be helpful. Like to go a step further and actually go search the web, find the image, show me the image and say, hey, your friend asked you if you ever seen this house plant. Anyway, it's early days. They're going to continue to iterate here. I've been You
could ask Siri.
I've been a Siri.
I don't remember if I've heard of Calathea.
I've Siri. Have I? I've been a Siri here for I've been a Siri hater for too long. I'm turning the tide. I'm I'm a Siri I'm a Siri supporter now. But back in 2024, I said, I just asked Siri what is an And it gave me this and it said LLM stands for stands for Master of Laws which is which is an advanced certification for lawyers. So in 2024, two years after Chad GPT launch or a year and a half Chad Tyler. GPT
Yeah. Have you applied for the beta yet?
Oh, yeah. You got to run it on your phone.
We got you
this phone.
Because you bricked we we
do you have the latest latest phone? Or are you one revision behind? Because only Time to brick. Only the latest phones that have 12 gig of gigs of RAM can run the latest local foundation models and we got to test those. We got to see if they're funny.
I made a prediction back in 2023. I said, with all these incredible advances in conversational AI chatbots, I'm willing to put down a firm prediction. By the year 2043, Siri will be usable. And I think it came true. I was I think Siri is usable You
haven't been able to verify this.
Ahead of schedule. Oh, yeah. It doesn't release yet. It's not live for a couple more months.
Okay. I'm downloading the beta.
Let's go. Okay. One point, I to
replace archive of posts.
I know. I know. I I you gotta know this lore. At one point, I replaced Siri with ChatGeePN TV, an iOS short shot.
01/08/2023. Yeah. Early. The most complicated
Yeah. You go in and it would and it would and it would take an API key and and what you would you would trigger this with a shortcut. You'd say, hey, Siri triggered Siri Pro Mode or something or you'd ask Siri Pro Mode a message and then it would route that to ChatGPT. Before they had the integration you had to do this manually. And it would you'd have to set all this up.
But it was pretty easy to copy and paste that. But important Apple history, Siri was an acquisition. M and A for AI is in Apple's DNA. This was a reminder from last year when Apple met with Mira Moradi, the former CTO of Open AI, to discuss a potential deal for her new AI startup, Thinking Machines Lab. The talks never progressed to an advanced stage.
What a different fork in the road moment they went with Gemini. But they could have had Thinking Machines Lab inside Apple, all of those incredible engineers and that that talented team. But they would have had to pay through the nose and Apple, you know, Siri was I think a couple $100,000,000 acquisition. It was not in the billions.
Yeah. I think it was 200.
Yeah. And Thinking Machines would have been 10 or something. It would have been a lot to to actually get Yeah. That deal across based on where they were. Gaussian splatting is coming to Apple Maps. This is very cool. Wow. It looks so much better. Look at this. Wild. Normal Apple Maps know that is what looks good. Right there. Once it gets the color grade. I like that. I don't know when you would use this. Maybe if you're looking around a town. I don't
know. I feel like this would be very cool if you were in a new city and you were trying to kind of like learn orientation. Right? Yeah. Like, let's say you check into a hotel in a city you've never been to before and you can navigate around and kind of
get a Or like you could do this at Disneyland with your AI generated kids and you could pick the particular region of Disneyland that you want to generate a fake image of your fake kids and then you could post that on your fake social network and you could just slop it up from start to finish. No. It's beautiful. I've seen some people use Google Maps and Google Earth for motion graphics. You know, in a YouTube video, you want to show where the action happened.
Let's zoom in from space. And this looks great. Apple did do a really, really good job with the geometry of some of these cities. They just went a lot further than Google has on the actual mapping and texturing. Whatever magic went in there, it's good and it's getting better.
So hats off to the Apple Maps team over at Apple. Anyway, we have our next guest joining in just a minute. Let me tell you about Figma. Agents meet the canvas. Your AI agents can now create and modify your Figma files with design system context.
There are some other stories that we're going to be going through throughout the day. This one's crazy. The North Korean economy becomes the world's most unlikely success. We've been talking up Pyongyang for a while. We've been saying a lot of people raised from PIF.
That's usually the public investment fund from Saudi Arabia. But if you just tell people I raised from PIF and it turns out it's the Pyongyang Investment Fund, might go to jail because they're sanctioned. But you might be able to sneak it across the finish line. But they are booming. Tyler, you read this story. You you had you had some takeaways. What did they do? How many oh, they built 10,000 homes.
Yeah. Which I I believe is more than
Los Angeles.
Los Angeles.
Yeah. How are they beating us?
So they're kind of
they're I think I think they read abundance. Right? Yeah. Behind Derek Thompson's
Yeah. That makes sense.
And it
They got abundance filled and then they said, yeah, we gotta build housing. I mean, it's like, if they're doing it over there, it's like Come on. What are we doing here? Like, they're the most sanctioned and locked up economy. But they are making money. They're selling arms to Russia and China. They have lots of nuclear weapons and they're building more by the day. And so they're they're they're on they're on track. Leopold also made it to the front page of The Wall Street Journal. Congrats.
There we go. He's doing well.
There we go. He's got his new picture in there. Claude Fable five is out. Okay. We mentioned it earlier in the show.
¶ Claude Fable 5
A bunch of feedback coming in. People on X having have had access to the model for a while now. Dan Shipper What over does at the information
have against it? They called it a neutered version of mythos. That's like it's sort think they say They're probably not framing it as neutered. They're framing it as more safe.
Thought it's safer.
It's safer and more reliable for certain things and probably cheaper. I don't know.
Yeah. Absolutely crushes the benchmarks. Dan Shipper is doing a live vibe check right now. Had access to the model. We will we'll summarize all the posts from today. Get them into
The pricing is $10 per input millions of tokens. $50 of output per millions of tokens. So if you're token maxing, get ready to pay. But the capability is
still But still, yeah, quite a bit people
are talking about like running it for nine hours straight, running it over the weekend for just long long time without getting confused. Very exciting model. Noam Brown had an interesting piece on the implications of large scale test time compute that I thought tied to this a little bit. And there was a very interesting quote in here where he said so frequently when I discuss this people ask why we don't just evaluate a harness that pushes test time compute until performance plateaus. The problem is that empirically the plateau is very far out.
Sometimes we may not observe a plateau at all within practical budgets. You can spend, spend, spend. So Karpathy, Andre Karpathy saw this in the auto research experiment where the performance continues to improve even after hundreds of experiments. And he goes on to talk about benchmarks a little bit, but at one point he says that a model might run for longer than it takes to train the next run, which I thought was such an interesting concept. Just this idea that you launch a product, you're running it, you say go do a job.
And then before it completes that job, you got the next model ready and released, which is a crazy, crazy world to be living in and something I don't think people predicted. But more and more compute, more and more inference, more and more reasoning all across the board. Meta launched a workforce academy to train workers to build data centers with five week program which is free of charge, guarantees a job, follows the recent layoffs of 8,000 employees. This is a learn to weld meme in real life. Forget learning to code.
¶ Meta Trains Data Center Workers
Meta Platform says it's time to pick up a wrench. The company is starting a workforce academy to train Americans to build its data centers as a skill as skilled trade workers become sought after commodity. Five week training program in partnership with CBRE and the associated builders And Tyler Contractors.
Has already been accepted into the program Huge news. With a disguise and a fake name. He will be learning to weld.
Huge news.
Huge. That would be fun.
I love it.
We should consider it.
RJ is running just a few minutes behind. He'll be joining in just a minute.
What else? We gotta talk about flock safety.
Okay.
Can we pull up this video?
Is this is a crazy endorsement for flock. The CEO's been Garrett's crazy.
An admitted criminal discussing the impact of flock.
Okay. Let's play it.
On
me, Sam. Just go, period. That shit ugly, brother. Oh, oh, mama. Nigga, they got drunk.
Just I'm a keep it busy. They're called
TBP unsafe. We need to bleep this before we play it. Okay.
We're gonna summarize it for you because I didn't realize that there were so many But swear basically, they say, you can't do crime in San Francisco anymore.
And these two gentlemen are are admitting to have previously participated in illegal activity.
Exactly.
And so they are They're actually They're sort of thought leaders.
If you steal a car, a drone will start following you immediately. Yes. And it will just trail you from thousands of feet up. Yes. You won't even necessarily know that following you.
Yeah. And so they won't gentleman hosting won't have a chance to like run away from a cop that finds you because they'll just wait until you're actually parked or stopped and then they'll box you
in.
And then the host of the podcast says, so can you even steal a car, run up on your ops, and ditch the car after? And they they say no. And so
He he doesn't just say that. He he describes it as the classic steal a car, run up on your ops and then ditch the car. Like it's a thing that's generally accepted. Have not to lay out a bare case for flock, but has anyone considered listening to podcasts where admit where criminals admit to crimes and going and arresting them? It seems like there's a
Talk about their methods?
It seems like there's a there's a dearth of these podcast clips, but who knows?
Yeah. Mean, these aren't even just like random petty criminals. They're listed as the gentleman on the left is Yes. One of the most prolific criminals in all of San Francisco. Wow. So presumably like, yeah, in the police force can just be like, oh, that's an interesting tweet.
Just Google it.
Guy's can't even do drive bys anymore. Wow.
That that is wild. That is a wild time. Anyway, let me tell you about Codex. Codex is a powerful workforce for getting work done with AI agents whether you're writing code, analyzing data, creating content or automating business workflows. Codex helps you move projects forward from start to finish. Moving on to the next story while we wait for our next guest. There are a few more. Pat Hackley is on
We a can wait for that one. Okay. Because someone over on X is telling Google's AI that I'm eating and drinking increasing amounts of salami and monster energy until it started shouting at me to get help. The person says, I just ate another kilo.
This is a
good response. A great response.
This is actually a great breakthrough in in lack of sycophancy and guardrails. Like, this is exactly what it should And be to give you the phone number there, I mean, we're only one step away from it just calls on your behalf. Yeah. Right? Like it should be able to make a tool call and know where you are and and the emergency rescue just shows up on your doorstep. Certainly possible. But, this is good. The bad response. The bad response would be like, wow. You really are a goat.
You are the legend who ate the most salami. You're not just you're not just consuming you're you're not just consuming salami. You're setting records. You should be the next world record eater of salami or whatever. This is good. Anyway, we have our next guest, RJ from Rivian with us in the TBPN UltraDome. RJ, how are you doing? Welcome back.
¶ RJ Scaringe, born January 19, 1983, is an American engineer and the founder and CEO of Rivian Automotive, an electric vehicle manufacturer. In the conversation, he discusses the launch of the R2 SUV, emphasizing its role in making Rivian's vehicles more accessible and highlighting its advanced features, including a range of up to 345 miles and a 0–60 mph acceleration in as quick as 3.6 seconds. Scaringe also outlines Rivian's strategic focus on scaling production and enhancing autonomous driving capabilities, aiming for Level 4 autonomy by 2028.
Good to see you guys. Thanks for having me on.
Thank you so much for hopping on. Congratulations on the launch.
Look at these pictures.
This is
a great great setup.
It's in your blood. Are are these all you driving go karts as a kid?
It's actually a mix. There's one of me and then they're mostly my kids.
Oh, that's amazing. Yeah.
But it's it's cool because it's like and some of them it's the same go kart that I was driving and then there's a few other go karts.
Okay. But but I'm seeing something very controversial behind you. One of those pictures looks like it's gas powered. What's going on?
Yeah. Oh, you know, I was
That was the spark.
Had to fix so there weren't electric go karts back then.
Oh, okay.
Okay. Have you been tempted to make a Rivian go kart?
My guess is that good? We have we actually have an electric go kart that we bought now.
Okay. Cool.
But too busy I know. But think of the Rivian if I assembled it.
It can't possibly compare to the Rivian equivalent. I
agree. But far too busy to work on go karts because you're launching the r two today. Take us through it. How is it going? What does this launch signify for the business? And what was, like, the key the key idea value prop? How long has this been in the tank?
Well, I mean, the idea of r two has been sort of part of the business since the very, very early days. And, essentially, the product strategy that we have is launched with the flagship set of products. That's our r one s and our r one t. Yeah. We launched those in late twenty twenty one, early twenty twenty two.
And that was really the think of it like the handshake with the world that established the brand, but these are these are expensive products. The average selling price in r one is over $90,000.
Yeah. So r two is
really our mass market product and what like, the whole business has been designed around this because it's what brings us scale. And so, you know, that's not just getting the vehicle ready that you just show the images of, but also getting the rest of the business. So service infrastructure, distribution infrastructure, obviously, manufacturing footprint suppliers. But today, we start deliveries to external customers. We've been delivering to internal customers, employees for a while, but these are the first external deliveries starting today.
The ultimate employee perk. I love it. Why is 330 miles of range the right number? Like psychologically, you could see sort of like the inverse of the nine ninety nine and go three zero one or three zero five. But three thirty, is there some rationale for that? Is it bounded by the batteries or is it bounded by the lifestyle of your customers? How do you land there?
It's a good question. I I I have not been asked that question at why three thirty versus three zero one. Yeah. Well, it's actually a it's an output rather than an input. The input was we needed to be greater than 300
Yeah.
On all configurations. And so Oh. We have an off road tire that takes the range down to three zero seven.
Sure.
And then the on road tire gets us to three thirty. At the beginning of the program, you're sizing you're making a bunch of decisions around, like, battery size, target for vehicle weight, target for vehicle efficiency. And in the end, we ended up exceeding a number of targets such that the the the least efficient version is 307 miles, and the most efficient version, which is actually the the base version with rear wheel drive, is 345, and then the all wheel version, which we're launching with, is, is three thirty.
Do the door handles actually matter? I've become completely normalized to the flat door handles. I prefer them now. They were controversial early on and the excuse that was, you know, given by anyone who was doing flat door handles was, well, it'll give you more range. But is it like 15 feet of range? It just doesn't feel like it can be 20 miles of range.
It's little more than 15 feet.
It is. Like I like range. It's good. It saved the energy. But at the same time, it just feels like of all the things that you could change, that can't be that big. But is it is it actually material or is it just like the flat It's
not I mean, it's not gonna make or break the vehicle. It it also is a design decision. It it allows, you know, the the surface language of the vehicle to be carried through the handle. So
it's Yeah.
As you said, it's a lot of folks who have adopted this type of a handle. Even even in non EVs, you're now seeing them.
Yeah. Yeah. I I was so fascinated. Like, one of the most impressive things about Rivian is the fact that the full size SUV and the truck launched basically in the same year, like very, very quickly. I don't know the exact shipping dates, like that is shipping one car is crazy, but shipping two vehicles the same time is obviously, there are redundancies and But walk me through the decision not to do a small truck as fast.
Is that market demand? I'm not really sure where the market for small trucks is, but take me through the thinking.
Yeah. I mean, to your point, we we actually launched the the r one t, the r one s, and we have a commercial van as well that we produce
for Amazon. Big customer.
Yeah. And there's a whole launch within three months of each other.
That's crazy.
And, you know, the classic question of, like, what would you do differently if you were to build the company again? And, you know, and often you try to give a non answer to those kinds of questions, but the but the honest real answer is don't launch three cars at the
same time. Gotcha.
That is, like, the singular biggest, thing I would change. It was it was enormously complex to ramp up the supply chain and get the you know, especially this was during COVID for one vehicle, but to do that times three, we were, like, like, choking on
it. Mhmm.
And so learning from that with r two, we have a launch edition that we're launching with. We have a narrower set of colors we're launching with. There's actually the whole r two program only has has less than 200 build combinations. Wow. And just to put that into perspective on r one when we launched, this is I say this is a learning.
We had hundreds of thousands of different possible build combinations we Yeah. And so, yeah, in theory, you don't build everything, but, like, if you click every box in different ways, like, there's enough combinations that we had to support that level of complexity. And so r two is this extreme exercise in being very aggressive on driving cost out of the vehicle in every possible way and learning from some of those challenges on r one. So to your question, there's lots of cool variants we can imagine of r two. Yeah.
And any of that platform, including things we've shown, like, have an r three.
Yeah.
But as tempting as it was, and I I guarantee you we had lots of debates, I've been tempted.
Yeah.
We decided not to pull r three in to launch at the same time as r two, but to let r two launch, ramp, have some breathing room, and then bring r three in.
But I can still do that aftermarket. If I want to wrap it in corporate SaaS logos, you're not going to sue me? I can do whatever I want aftermarket?
Yeah. If you want to wrap it
in Make it look like a NASCAR for Silicon Valley. Maybe that's I
don't know if I love it, but you can do it.
You'll yeah. Last time you're on, you you talked about like just how different, you know, Rivian is
Mhmm.
The way that you guys have built it from the ground up to be, you know, a singular singular, basically, computer, singular software system, all this stuff. And and the advantages that you get from that maybe taking a legacy car design and then trying to electrify it. Yeah. With the recent with with a number of high profile EV launches Mhmm. In the last, let's say, this year, I would love for you to kind of like revisit that and just because I I thought it was a fascinating explanation and particularly interesting now as we've seen these other manufacturers just try to enter the the category and come in with products that I don't believe are are incredibly compelling.
Yeah. Well, there's there's a lot embedded in that. I think at the core, there's a number of things that more by coincidence than by necessity when for a new EV, let's say, a Rivian, and and I'd say Tesla falls in this category. When you architect a vehicle from a clean sheet, you end up approaching a number of things differently. Obviously, there's the battery and electric drivetrain that's different than an engine.
But I'd say the the biggest other difference that is probably not appreciated or talked about as much, but it manifests certainly in terms of customer features and things like over the air updates is around software and electronics. And the software and electronics that exist in really every vehicle from a legacy existing manufacturer, so it's every manufacturer outside of a Tesla or Rivian. What what they look like is is really a reflection of a long, multi decade evolutionary track, which started ironically with the first computer that made its way into a car, which was to power or to or to drive the fuel injection system, which is somewhat ironic. But, you know, prior to, you know, early nineteen sixties, cars were completely analogs. There was no there was no microcontrollers.
There was no computers in the car. The first computer came in and it was specific to the domain of fuel injection. So that was designed to support, you know, just putting the electronics in for the fuel injector. Subsequent to that, you know, starting in the nineteen sixties and all the way through today, as different functions started to have software capabilities embedded in them, let's say, seats that have memory or power windows that have intelligence to not, like, crimp your fingers or HVAC systems that had settings and things that were not just mechanically controlled. Each of those functional domains had a little ECU that was created for by the supplier.
And over time, this has grown. I I describe it sort of like a field of weeds. And so it's not a planned garden. It was not architected. You ended up with what you have today in most cars, which is, sometimes upwards of a 100 to a 150 little computers, what we call little electronic control units that correspond to a very specific function or domain.
Yeah. And those little computers have their own little island of software written by a separate team. Often, it's not even written by the supplier. It's written by a third party, often overseas, often in India. And so you have this, like, mess, like, apps truly a mess of software where you have multiple different, you know, little islands of code, none of which are coordinated, all of which now to deliver complex features that have things working together require a lot of coordination between suppliers.
And it's for precisely that reason that you see very few significant over the air updates on traditional cars Because to, like, let's say, update the sequence of events that occur when you walk up to the car, you know, where the the horn makes an audible noise, the door unlocks, the HVAC comes on, the seat adjusts, the steering wheel adjusts. Let's say there's a the music adjusts inside the car, the battery system, you know, comes to life. All those are different controllers. So just to change the order of events, it's very hard. You gotta coordinate, like, between 10 to 15 companies, in a classical sense.
And so what we built is something where you can solve it all that compute onto a very small number of computers. We now call those zonal controllers because they work in a physical zone of the car. And it runs one OS, which we built, and that single OS allows us to very easily change things. And that that architecture is what underpins not only Rivian's, but we did a a large $5,800,000,000 software licensing deal with Volkswagen Group to take that technology and help them on their journey with their future electric products.
That's very cool. Thank you.
So the Re explaining.
So the R2 boasts more AI infotainment compute power than any vehicle currently available in North America. And I'm interested with the backdrop of WWDC. What does the future of AI infotainment in a vehicle look like? Because you're starting to bump up against the ability to run on device models, I'm sure. And Yeah.
There's this trade off. We saw it with Apple where there's some stuff you can do on any phones, basically. Any there's other things you can do with 12 gigs of RAM just on the latest phones. Other things that's going to go to their cloud. I'm sure you have, you know, a series of abilities at But varying when I get to the examples, I don't necessarily know that, like, people were sort of laughing at you get a text message that asks you a question and it summarizes and it just asks you the same question.
And you don't you probably don't want to be the CEO that's going around to the employees saying like stuff AI everywhere. Like people are going to want to you know have AI decide how far the window goes up or the windshield windshield wiper's gone. But there probably are interesting ideas. So how do you see that evolving? What's the role of the car as a compute source versus cloud? How do you think about that?
Yeah. Well, I'd separate the features that we deliver from the platform.
Okay.
And the way we've architected r two is thinking of it really as a platform. So we want to embed in it enough headroom for features to grow dramatically and for things to evolve in ways that even today we can't imagine. Yeah. And so on everything that's infotainment related, putting a really powerful turner tops, you know, platform into the vehicle allows us to run much larger models in the vehicle than, like, let's say what we can run-in r one. So r one, we just launched a a Rivian assistant.
And for the we can run a small model on board, but for anything that's, you know, more complex, we have to go up to the cloud because we just don't have enough pewed in the vehicle to be able to run these larger models. R two is quite different. So r two has a much higher headroom, so we can run a lot more a much larger model in the car. And it it is it helpful because it reduces latency? So suddenly you can have much more, you know, natural back and forth conversations without having to wait for things to send up to the cloud and back.
And so we built that in knowing that we're gonna add more over time. What we have today is a better version of our Rivian assistant that'll be going into the car. We have that'll be actually continually getting updated as well and continually getting better. And you'll start to see, as you just described it in the case of iPhones, you're gonna see differences in, like, our gen one our gen two r ones and our gen one r ones aren't gonna have the same hardware capability that we have with r two.
How are you thinking about self driving and what the next few years looks like there? I've been Yeah. Surprised that we've seen this, like, insane capital war in the foundation model companies and and hyperscalers spending hundreds of billions of dollars. And Yeah. Yeah.
We saw that a little bit in automotive years ago with the Cruise acquisition by GM and there's been Yeah. Initiatives and the technology is on a good track, but it feels no one has self driving psychosis. Like no one no one is saying that like, oh, every automaker is gonna go bankrupt because they're investing too much in this. Everyone's like, yeah, the the self driving is getting better and we're on a smooth path and in a couple of years, the cars are you're gonna be really not touching the steering wheel at all. But is that is that conscious?
Is that based on the research trajectory? Do you expect that to accelerate? Like, how are you thinking about self driving these days?
It's a great question. And it's important just to talk about, like, the history of self driving and how much the technology has changed. And so self driving has been a I mean, it's been a topic of science fiction for for many decades, but it's been a topic of of real applied work, you know, since, like, early twenty ten. So call it, you know, 2013, 2014, it started to emerge as something that people were working on. And the way those early models were being built, And and that this was true up until 2022, 2023 where you would essentially take the the knowledge of driving and try to codify it.
You try to put that into code that would then have you'd have cameras and a perception stack, maybe cameras plus radar plus LiDAR depending on the vehicle. Yeah. But that would perceive the world. It would handle that information to a planner, the planner's code that's representing human knowledge or driving that's coded by humans.
Yeah. It was almost all c plus plus, and it was, other than other than processing management. Is, like, highly rules based environment.
Yeah. And then output, controls Yeah. Control directives to the vehicle to then steer, brake, accelerate, what have you. That approach has been completely superseded Yeah. By a foundation model based approach.
So instead of trying to write code to represent driving, we're training these multi billion parameter models. And when I say we, I mean the people who are doing this correctly. Would say, to be honest, it's not everyone falls in this category, but the right way to do this is clearly to build a large neural net multi billion parameter model where you're training the model with the benefit of millions and millions of miles from vehicles being driven. That model is getting better and better over time through the learning of the installed car park. And so the way we designed R2 was we wanted to put a lot of compute into the vehicle, so a lot of inference.
We want to have a really robust sensor set that's not just there to drive the car, but importantly allows us to collect a lot of data and to allow us because we want to have really high data quality to allow us to catch up rapidly where Tesla is and ultimately be a leader in the path to level four. So the path to the idea of the vehicle driving empty. You know, are you sitting in the back seat or picking up groceries for you or dropping you at the airport? And so the timeline for us on that is getting to level four in 2028. And backing up from that, we have point to point capabilities, which will launch later this year.
So that's you're in the car. You're in the driver's seat. You type the address in. The car will completely navigate to that address. Your hands are not on the wheel. You're still, you know, alert and aware of what's happening in the driver's seat, but you're not driving the car. That's what we call as hands hands off, eyes on. Next year, go level three, which is hands off, eyes off. So you do all that, but you no longer have to look at the road at all. You can be on your phone.
You can be reading a book.
But you have to be there in case the car asks you to take over. Right?
Exactly. And that's that's level three. And then level four is where the car won't ask you to take over in any situation. It's it's fully on its own.
Are there any But but
one thing I really wanna make clear, if if if everything I just said, was ignored, the thing to keep in mind is when you think about, like, technical progress on a topic, it's it's very natural. It's like human nature to look at previous progress and use that as a way to extrapolate what future progress is gonna look like. And the reason we so naturally do this is it's generally true. So if you look at, like, how we're building homes today, we can look at the last five years and say, well, that's probably how we're gonna build homes for the next five years.
Yeah.
That ceases to be true when you have these big technical inflection points, and those don't happen often. Like, so the like the invention of semiconductor, a big tech inflection point. In the case of autonomy, the invention of what we think of today in terms of modern AI, so transformer based encoding, the idea of these large scale foundation models has completely shifted how autonomy is being developed. And so I would characterize it as the progress that was made over the last five years, let's say, from 2021 to 2026, is not at all representative, not even a little bit representative of what I think the progress is gonna be over the next five years, so from 2026 through 2031. And I actually think that the progress is gonna be faster than society will be able to ingest.
And so today, you know, if, you know, we're in San Francisco, it's it's easy to go, like, hop in a Waymo and experience this. That's a, you know, it's a tourist attraction for people that don't live in San Francisco. Yeah. That is just gonna be cars. Like, I I mean, in my view, I think, like a car that you buy in 2030, 2031, you will expect it to have capabilities similar to that.
And it's sort of hard to, like, believe it because you're like, oh, we've been saying things like this for a while, but there was a big shift in how the models were developed, and and it is we're seeing it firsthand. Like, the rate of progress we're making on our own platform is materially different than what we've been doing for, you know, the last two years.
That's super exciting. The I had an interesting conversation with someone who owns like, I think, five to 10 car dealerships. None Okay. None of the none of the brands that he sells has any type of like meaningful autonomy. Maybe they have a team working on it, but not not really tangible progress.
And I asked him, how much do buyers really care about autonomy right now? Do they come in and say, well, I love the look of this car, but it doesn't drive me, so I'm not super interested. And he gave and and his his dealerships are in in like the Midwest. And he gave me an interesting answer. Said, like, I don't like, it's not really a big concern.
It's not like a top Mhmm. Priority for our buyers right And I think it was because a lot of a lot of the people in that area have like a fifteen minute commute, twenty minute commute, something
like Interesting.
And I compared that to friends of mine. And and I live about forty minutes outside of like LA area. And I have two friends who just could not fathom driving anything but like their model y because they're just addicted to autonomy now. They're just like, I don't care what any other car looks like. And so I think like one of the big kind of wake up calls is gonna be for the big manufacturers over this next five year period, where even if they're lagging like one to two years behind Mhmm.
As companies like Rivian kind of like achieve these new levels of autonomy Yep. It will be it will be just so hard to compete purely No. On aesthetics and and how does what is the internal leather look and feel, things like that. Historically, it mattered. So
I couldn't I couldn't agree more with everything you just said, including today, it's not a huge it doesn't drive a huge percentage of purchases. And I think part of the challenge is even with, like, Tesla's FSD, it's a it's a very, very good level two, but you're still required to be in the driver's seat.
Mhmm.
Still required to be alert. I think the big inflection point is the moment you start to without the car dinging at you, you're asking you to look at the road with, like, where you truly get your time back, where you can, like, be on an iPad the whole ride, not look at the road once. And I think that you experience that once or twice and you don't think you needed it, you didn't think it was part of your purchase criteria, then you're like, wow. I, like, must have that in my next car to your point. And I and I think you see with early adopters within the Tesla ecosystem, like, that's definitely true.
If someone's been using FSD for a while, it's very hard for them to imagine a car that doesn't have at least those capabilities.
Yeah. Final final question. I I I'm sure you have to jump, but the car enthusiast for in me would love for the r two to be such a massive success for you to sell so many units that you guys have the ability to fund maybe something like the the nine eleven equivalent of an EV, you know, somewhat accessible
Taycan monk.
You know, something like an accessible sporty EV for enthusiasts. What's on the box? Hearing hearing everything that you've said, I just feel like you're never gonna actually be able to fully justify that, but I can dream. Is there
any about a track only I'm a show.
On eleven right now. So you've got that.
Yeah. It is. What what about track only version of the Amazon delivery van? That's what I'm in the market for.
Very small market
for that.
Very small market. I wanna wing on the back. Some active era. Yeah. Let's do it.
No. But I think I think
Probably like five people.
No. But I think the I think the like $80,000 enthusiast Yeah. Car for the EV market will eventually
I mean, I I I would actually take the take the other side of this just to, you know, steal, man. It's just like the focus on the categories that you've chosen have clearly been remarkably prescient and accurate in the sense that like more and more Americans are buying full size SUVs for their families. Trucks are still incredibly popular. Midsize SUVs are popular. And as much as the car nerds love the old sedans and the sports cars and the two doors and the convertibles, like, those are just a different tool.
They're a recreational It's like a special Yeah. That's right. And like Jay Leno loves them but like there aren't that many Jay Lenos if you're trying to build a big business and maybe this comes down the pipe but we're not gonna
Yeah.
I'm praying for millions and millions and millions of Me too. Car twos on the road. Me too. And so RJ can justify the go kart. Yes.
Of So
you can justify the go kart. So you can justify the the the $9.11 equivalent. So we'll be praying for that.
Think if I were to stack rank them though and things we would do, the nine eleven equivalent would be higher than the go kart and higher than the Supervan that you described.
Track only okay. So so we we got only upwards to go. So that's good. Yeah. So
so it's more likely than the other options.
Yeah. Well well, I'm getting one. Thank you so much for coming on. We really appreciate it.
Great great to get the update and congrats It's to the whole a Oh, thank
Yeah. We're very excited. Have a great rest Congratulations. Of your Goodbye. Let me tell you about Console. Console builds AI agents that automate 70% IT, HR, and finance support giving employees instant resolution for access requests and password resets. And our next guest is already in the waiting room. We have Chris Miller, the author of Chip War, a fantastic book. If you haven't read it already, he's been on the show before. Welcome back to the show.
¶ Chris Miller, an economic historian and professor at Tufts University, is the author of "Chip War: The Fight for the World's Most Critical Technology," which examines the global competition over semiconductor technology. In the conversation, he discusses the recent surge in semiconductor spending driven by AI advancements, the cautious expansion strategies of manufacturers like TSMC, and the geopolitical implications of China's investments in AI infrastructure.
Chris, how are you doing?
What's going on? Doing well. Thanks for having me.
Thanks for hopping on. I guess the first place to start since you've been on the show before, we did the whole deep dive on Chip War. I've read the book. It's great. Hopefully, most of the audience has read it. If they haven't, they should go pick it up. But what do you think has changed the most since you wrote Chip War? What what is what have been your biggest updates to your sort of world model, your way of thinking about the Chip War broadly?
I think the big change is that for the last two decades, if you look at semiconductor spend as a share of GDP, it was roughly flat. Yeah. And then in the last four years, it's roughly doubled. Yeah. And that has been all been driven by AI. And I think, you know, the question is doubling is fine. Can it triple? How much more can it go relative to trend line? That's the big question, I think, hanging over the industry right now.
And is that gated by TSMC capacity, energy capacity, AI demand? The AI demand seems to be there. Like everyone's inferencing models all day long. The models require more and more chips. A single model these days needs an NBL 72 or a whole rack. But what do you see as sort of like the key inflection points that people should be watching for as the semiconductor industry continues to boom or, you know, tops out at some point?
Yeah. I I think right now it is it is gated by TSMC and manufacturing capacity more broadly. If But you put yourself in the shoes of those companies, they're looking at AI demand, not sure how strong it's gonna be. Obviously, strong, but it's strong enough to double or tripling if semiconductor spend is a shared GDP. That's a a big jump.
And, of course, they're on the hooks for the CapEx. They've got to build the factories. They've to pay for them. And so I think companies in the manufacturing layer are excited but nervous about just how far this is going to run. They have an incentive as a result to be a bit more cautious on building chip plants than AI companies would like.
In historical infrastructure build outs, let's say like electricity and railroads, was there ever a key supplier that just didn't have any sort of like insane FOMO fear of missing out. Like I'm thinking like railroads, was there a critical supplier that was like, you know what? We're excited about this trend. We're investing in it.
We're building enough railroad ties.
Yeah. Like, you know, if there's any historical Because it feels like a very it feels like on one hand, obviously, there's frustration Yeah. From other players in the supply chain. But at the same time, it it feels like somewhat like how like, potentially healthy even though I think you can
Mhmm.
See that bubbles have have, you know, produced great results
Yeah.
Throughout history.
Yeah. I think we are in a somewhat unique moment in that there are a series of choke points down the supply chain where you just rely on a single company for most capacity, and that didn't happen with railway ties. Sure. Yeah. It hasn't happened with electricity.
You have it with TSMC layer for sure, but then you look at their suppliers for key materials, for advanced packaging, and there's often choke points there as well. And the trick is that the deeper you get in the supply chain, the further you are from the actual end AI demand and the more skepticism builds up as to how real is this actually. That's why there's been underinvestment in the materials and manufacturing relative to what Silicon Valley needs.
Yeah. It's the bullwhip effect. Right? A small change in demand amplifies and amplifies and all of a sudden they don't want to get caught at the tail end. And also what I know know Nvidia traded all over the place during the crypto boom when cryptocurrency miners were using GPUs and then Ethereum went proof of stake instead of proof of work and there was a drop off in demand there.
But I'm wondering, do you remember if TSMC had the same level of skepticism or or or was even affected by the previous rise and fall of NVIDIA?
You know, I I think the key is that before the last couple of years, NVIDIA was one of many customers that TSMC Sure. Had and Apple was the most important. Yeah. Whereas now it's kind of flipped. NVIDIA and AI in general is the key growth driver. So in the past, TSMC would have more closely tracked smartphone sales than they would have tracked data center build out.
And smartphone sales were on a much more steady pace since Apple has their whole machinery of refreshing and planned obsolescence potentially.
Yeah. You look at individuals are not like I need like the iPhone's gotten so good, I need five phones.
Yeah. Yeah. Yeah. Yeah. There was no exponential take up.
But now there's like, okay, I need 10 more, 10 times more tokens, a thousand times more tokens, etcetera, etcetera. Staying on TSMC, I'm curious about the culture there because TSMC is known as this like champion of Taiwan, the most elite institution, the crown jewel of Taiwan. And like why we explained the bullwhip effect a little bit about the reticence to deploy more CapEx. But is that is there also some sort of cultural element or capital markets dynamic? Because when America has a crown jewel, we're like send it to the moon.
Like, oh, oh, there's a there's any excuse to 10 x capacity or 10 x, you know, the the scale of our crown jewel. Like, let's do it. And it seems interesting that you would have a company that has this opportunity and there's like a glimmer of a hope for it being even bigger and yet there is it more of like this protective mindset of like we have this good thing going, let's not risk it or is it just like they can raise prices so they're less there's less downside there?
You know, I think it is a conservative culture, but I think they're they believe their conservatism has served them well in the past. Yeah. There have been cycles in the past, and and being cautious going into this cycle gives you the opportunity to invest at the bottom of the cycle. And TSMC has done that really well historically. Now I think, you know, right now, they they realize that we're not at the top.
They're building new factories as we speak. But I think they're also, you know, looking at the history and saying, we don't wanna overinvest Yeah. Relative to what our customers are gonna need.
Yeah. And then and then what does the the the domestic chip supply look like from your perspective right now? There's a ton of energy around Intel, and it feels like Intel checked a lot of the boxes for the comeback. Like, the comeback hasn't really arrived yet, but in terms of, the backstop from the U. S.
Government, additional investment, the stock price is up and a bunch of buyers and potential customers are falling in line for their most advanced node, it feels like things are on track there. But what else is going on? And is that actually a pressure on TSMC at some point?
I think to some degree that does create a bit of pressure. I agree that Intel looks like it's in a much stronger position. I think that customer traction is the key thing. And as you say, we haven't we've seen news about customer traction, but not actually volumes yet. And Intel really needs substantial volumes of customer orders.
So I think that's one positive sign. I think everyone's watching carefully what Elon's gonna do with TeraFab. Yeah. How that's going to grow. It could be transformative.
It could not be. It's obviously a hard industry to to break into. And then, you know, there's Samsung with a a big plant in Texas. They're bringing online and also Tesla's reportedly one of their customers. So you look across the ecosystem and there's certainly a lot more optimism about leading edge manufacturing than it would have been just a couple of years ago.
Bull and bear for TeraFab. I would love your takes.
You know,
I I think a, never bet against Elon. But b, you know, it seems like he's lining up a coalition of partners on the IP side, on the manufacturing side. It'll be interesting to watch how it develops. I'm excited.
Yeah. I guess the question is, like, how much of the fab is him versus he's the buyer and there's and it's actually Intel doing everything because I don't think anyone doubts that Intel can like run a fab since that's what they've done for decades. And if you and if you bring on the right partners, seems like it could be possible.
Well, interesting. What do you know about ASML's current thinking around AI progress and the build out and and how they're thinking about investing against this
progress?
Well, think ASML is in a similar position to TSMC. They want to meet customer demand, they don't want to overbuild. And they're also on the wrong side of the bullwhip. And so they have an incentive to be a bit more conservative than their customers do. But it's been a great year for ASML as, obviously, demand has just been through the roof.
That's I think that's going to continue for for some time. I think the other challenge that ASML is is working through is that TSMC, their most important customer, has said they're not going to buy the latest high NA lithography machines at least for a couple of years. That's also a medium term challenge for ASML because they're trying to sell their next generation machines.
It sort of doesn't matter how AGI pilled you are if your customer doesn't show up to buy the thing that you're making in the supply chain. How have you been how have you been processing the export export controls back and forth? Because it feels like it's been every other day. It's like, okay, we can send anything and then we can sell the nerf stuff and then we can sell nothing and then everything. And it's been going back and forth and that's sort of the nature of this administration.
But is there is there a clearer through line that you've detected? Is there something else going on there, or is it as chaotic as I've been reading into it?
Yeah. I I think, you know, step one is don't read the tweets. Mhmm. And step two is look at congress. Mhmm.
Because congress that's where you get the bipartisan support for these export controls. And I think congress has been playing an important role in influencing the administration. You've seen a bunch of influential Republicans, for example, publicly support export controls, trying to put pressure on the the White House. I think the the third thing that's important is, Methos really did change thinking in the White House about Mhmm. How powerful AI is gonna be, and how important it is to have the leading capabilities to yourself.
And so I think there's been a shift around the AI debate in the White House just over the last couple of weeks.
Yeah. So related to that, there's reporting in Reuters today. China prepares $295,000,000,000 plan to fund nationwide AI build out. How did you interpret this? Do you see this coming?
And then I'm interested to know, like, do they have the supply chain to actually deploy $300,000,000,000 Because the numbers that I've seen back of the envelope for if the chip controls get weakened and NVIDIA can sell the TAM is like $10,000,000,000 which would be great, but not like huge and certainly a small chunk of this. So are they advancing enough with SMIC and SME to indigenize their supply chain and actually spend this money? Do they have other plans? Like, how do you see this playing out?
You know, I think first those numbers are over five years. So annually, that's less money than Google or any of the hyperscalers. So just to put into context.
Play the bald eagle sound, baby. We still got it. We still got
What do they know? Do they know?
What do they know?
What do they Chris? No,
seriously. Seriously, like
Yeah. Do read into it?
They're they're No. I mean, this is the puzzle. Yeah. The puzzle is is why isn't Xi Jinping more AGI built? Sure. You know, if you thought AGI AI was important, you thought chips were an important ingredient, China's been underspending for the last four years on AI. And and I think it's because the Chinese government just doesn't really believe
Interesting.
That AI is gonna be nearly as important as we do. And if they did believe it, they'd be, a, buying h 200 chips
Yeah.
And, b, spending more on on data centers. They're not doing it.
Is it possible that they just that that like, they believe in AGI or something, but they just have longer timelines? Like, it feels like a lot of the underwriting that's happening in The United States is based on, like, eighteen month of coincidentally exactly the VC timeline for for around. It's like what will we do in the next eighteen months? We're AGI in 2027, 2028. Really short timelines here.
And then that's also backed up by Dwarkash Patel had a post saying like if AGI comes soon, America wins. If it comes longer, China wins. And it feels like that's almost like I like his analysis, but it's also like a reflection of the of the revealed preferences of the two countries where America is sort of building towards a fast takeoff AGI soon scenario. And China might actually not be like necessarily behind the ball. They might just be optimizing for a 2,035 AGI.
And if they ramp up slowly, there's gonna be less gyrations, less of a bullwhip effect, and they can take a longer view. How do you process that?
Yeah. I I think one explanation is just that The US is a service sector heavy economy, and AI is gonna be more impactful in services first, manufacturing second. Yeah. And so that that could be part of the story. I think, you know, second, US firms just could be more tech forward.
You see this in in cloud computing. You know, China has a tiny cloud computing market relative to GDP because its large enterprises just don't wanna move to the cloud. Oh. And so that that could be another analogy. And then I I think third, we we should be open to the prospect that the Chinese government just hasn't gotten the memo yet. Yeah. You know, for better or for worse, we have no deficit of venture capitalists and tech entrepreneurs in government.
Yeah.
And of course, China is not the center of government. And then that could be another factor.
Yeah. You would think they would be excited about it purely from an authoritarian lens? Because like if you have like the all powerful model that that can Yeah. Basically theoretically They already have all of every single Yeah. Micromanage every single citizens Yeah.
The content that they get, the services they get access to, you know, how much how much the retirement benefits they get. All all all these different things like it it it In The US, we think of this authoritarian AI scenario as like a, you know, doomsday scenario. It sounds terrible.
But if you're an authoritarian.
But if you're an authoritarian, you think like, I gotta get I gotta get one of these authoritarian models. Yeah.
I don't know.
Yeah. I I I I think that dynamic is I I think the risk if you're if you're an authoritarian leader is you don't know what the model's gonna output. They're not nearly deterministic enough for your preferences. And that that's the that's the downside for any authoritarian leader.
Yeah. There was recently Or
or or better better better training data. There there
there was recently reporting instructed the Kremlin to disconnect or or firewall or air gap all of the CCTV cameras that are, I think I guess, inside the Kremlin or or or like could potentially triangulate him because they were worried about a hack where his location is disclosed to a foreign adversary. And so, yeah, you can see that these tools cut both ways. Have you have you actually followed anything on what's going on in In Russia? But before
we go there, wanted to ask how closely have you followed the whole Manus saga Yeah. And debacle? Do you know the latest? It feels very unclear how something like that gets, you know, unwound, but
Yeah. Are they still in China? Yeah. Don't know.
Well, this is I think the the really interesting part is that, you know, if you have a broader campaign of pulling passports from leading entrepreneurs, that is a extraordinarily chilling sign for the rest of the the industry. I think there's a real you know, if I was sitting in in Beijing, I'd be really nervous about being too tough on my entrepreneurs because those are the people you need to invest and build companies. Yeah. And that's a pretty risky move, I I would think, for Beijing in terms of building their own domestic ecosystem.
I mean, Liang Wenfeng, the founder of DeepSeek, has the most control, I think even higher level of control than Elon at SpaceX in terms of founder ownership and concentration because he had High Flyer, the hedge fund, and then he funded DeepSeek. So he did the first couple rounds and provided like 80% ownership. I think it's like 80% ownership and I mean, it's already a multibillion dollar company. Could be one of the biggest companies in China if AI labs are any indication in America, if there's any correlation there. And so he's gonna he should get a second passport maybe or something.
I don't know.
Anyway. But Russia Russia.
Russia.
We've trying to we've been trying to figure out how many like GPUs they have.
Well, ten years ago Vladimir Putin was giving a talk and he said whoever wins AI wins the future and he lay he was AGI pilled before way before it was cool. Then he got into a crazy war and he and it seems like he lost all of his best talent to Nebius and what what's the other one? Clickhouse Yeah. And a bunch of other Yandex spinouts and stuff. And so I'm just wondering like has Russia come up at all in your research of, like, where chips are going, where data centers are getting built?
I just don't hear them in the conversation at all and it's surprising to me because they have nuclear weapons.
Yeah. No. I I think I I think you're absolutely right. They're not a big player, and the reason is because Nebius is outside of Russia. That's an example of a team that was one of the leading groups of tech entrepreneurs in Russia, at least until 2022, and now they spun outside of Russia and are building a great company in the West.
And that's a microcosm of the entire tech ecosystem. The best estimate is that hundreds of thousands of Russians left the country after 2022 disproportionately well educated Wow. Disproportionately in the tech sector. And so, yeah, there there have been some reports of GPU smuggling into Russia, but it's, I think, small scale because there's just not the demand for building big data centers.
They're gaming. They're they're getting those GPUs.
They're gaming. Gaming.
It's like they they only smuggled ten eighty TIs? You can't run advanced LLMs on those. Yeah, they're gaming. Talk to me about the reception in China of American GPUs, Western GPUs. There's like interesting smuggling dynamics, interesting debates over NVIDIA export controls.
But then we see these articles pop up every once in a while saying like Beijing doesn't want them or Beijing is going to pressure local companies to use the Huawei Ascend chip or go more indigenous. And I'm just interested because we label China as like authoritarian but obviously no system is perfect one way or another, obviously. And so, do they actually have the ability to restrict this? How much do they actually want? Do they really care because it feels like the the pool of compute is pretty fungible and I don't know how are they worried about like security risks or dependency?
Like, would you rank their their worries?
Yeah. Yeah. I mean, what what we know is there is smuggling at a reasonably large scale. Mhmm. There's also offshore compute access. If you're a Chinese hyperscaler, you can get access to compute in Malaysia
Yeah.
Or wherever else. Mhmm. But it seems like the Chinese government is is really fixated on pushing firms to buy Huawei. Mhmm. And it's surprising, I that think, they haven't let Chinese companies buy the h 2 hundreds Mhmm.
Despite that it's now been half a year in which the Trump administration has been allowing sales. That goes back to what's the Chinese government trying to do. If you were AGI pilled, you would buy the h two hundreds. Yeah. But if you're not, then you're focused on domestic manufacturing and supporting the Huawei ecosystem.
If you're worried about data security and think there are backdoors, which I think the Chinese might be worried about, then maybe say ban the foreign ships. Yeah. There'll be a bit of smuggling, but better to build up your domestic ecosystem first. And that does seem to be the revealed preference of the Chinese leadership.
Why do you think what are the keys to China's broad support of AI locally? AI pulls so terribly in The United States. It pulls terribly in the EU as well. But China is almost flipped. It's like 80% support artificial intelligence. Only in America, it's like 20%. What's going on?
You know, I think part of it might just be the media landscape. You know, in in in China, if there are topics that the government doesn't want discussed, they don't get discussed. That's part a. You know, b is that the the entire tech sector is much less controversial among the Chinese populace than in The US. We've had a decade of debates about Mark Zuckerberg and social media.
That's been present in China to some degree, but, much less toxic, than in The US. And then I I, you know, I think third, US AI firms have been uniquely bad with publicity.
Mhmm.
Promising to destroy jobs, promising to threaten the future existence of humanity. That's been the marketing of AI over the last couple of years and, you know, when you hear that, it's not surprising people don't like it.
Yeah. Yeah. That makes a lot of sense. Is anything happening in Japan that's relevant right now?
I think the big story in Japan is the the number of companies that have been discovered to have extraordinary materials capabilities that sell into the chip supply chain. Mhmm. So my favorite example is one of the toilet makers in Japan has an advanced ceramic capability that's used in the machines that make chips.
I know and it's so funny because when the headlines started breaking around that Mhmm. This was probably two three months ago, a lot of people were like, wow, top signal, like Yeah. The toilet company is getting into
Yeah. It was like an all birds Yeah.
It looked like just like a pump but no, I actually have, you know, an industrial process that's very valuable and
So fun.
Very real.
Yeah. I mean, yeah, great lineage there in I mean they were doing humanoid robots. The Honda Azimow or something was in like 2002 and it feels like the Japanese economy just sort of lost a step and just didn't keep doubling down. They were just too early and so they ceded a lot of that territory to China and America. But I'm I'm rooting for a comeback because I like that Honda robot. It was cute. Didn't feel like Terminator at felt like c three p o. I don't know.
That's right. That's right. I think the Japanese robotics firms, I I think they're they're so focused on factory automation. Mhmm. And that's where their expertise really lies that they're struggling to get their heads around what does AI plus robotics actually mean.
Sure. Sure. Interesting.
Last question for me. Is NVIDIA a car? What's going on with their moat? How are you thinking about NVIDIA in the supply chain? How important is their role? How defensible is their position? The debate was Jensen saying NVIDIA is not a car. It is not something you can just step into and get where you're going. It's a special product from a special company.
So I think we're into year two at least of the ASIC debate. Yeah. It's clear ASICs will have some market share, but it also seems clear that NVIDIA is gonna be the dominant player by far. I thought it was interesting to watch NVIDIA acquire Grok technology six months ago showing that they're gonna be able to diversify into inference focused hardware, building their empire of sorts, and CUDA still remains a very powerful part of the moat. So, you know, is the market share gonna decline from 90% to something lower than 90%?
You know, that that's what's happening. But that does that mean NVIDIA is, not gonna be the dominant player? It certainly seems like it's well on track to be the key provider of GPUs for long time to come.
When's the next book coming?
I was going to ask. And and tell us the title. Is he but obviously, you can't announce anything. But if you were to create the next chip war, would it be called Chip War two or would it be called Battery War or Robotic Supply Chain War or, you know, Energy War? Like, is there a new war that will supersede the the chip war, become the most relevant topic or are we just doubling down on chips?
You're you're kind of using a little bit of fear based marketing yourself, Yeah. War. Yeah.
A Why not just beautiful trading and collaboration and yeah, there'll be prices.
Chip trade, I don't
You know, yeah, chip trade doesn't sell Chip any
industry. Chip industry dynamic.
Yeah. Chip industry deep dive the book. That's what yeah. Fear based marketing or you caught him redheaded.
It's working on me. It's working on me. I want I want the next one.
The next book, the next hot topic, the next thing that you'll be digging into. What are you thinking?
You know, I I think I'm spending all my time on chips right now.
Okay.
I don't know if there's gonna be a sequel, Chip War two.
Chip War two, Revenge
of the Oh, that
sounds so good. Revenge of the Chips, that's where we are. Yeah. But sequels are never as good as the original, so I think probably not a sequel on that topic.
Maybe Chippeas. You've done Chippeas.
Chippeas. Hope so.
What is the path to Chippeas? That's what I want to hear. A lot of fear mongering, lot of worries about war. We need a lot of ways to get out of quagmires, I think. That's generally what I'm rooting for. Anyway, thank you so much for taking the time to come chat with us. This is a lot of fun.
Yeah. Really appreciate it. Glad to
have back on soon. Go get the book, Chip Ward. Available everywhere books are sold. We'll talk to Have you great Goodbye. Let me tell you about CrowdStrike. Your business is AI. Their business is securing it. CrowdStrike secures AI and stops breaches. Our next guest is in the waiting room. Already, have Evan Beard from Standard Bots.
¶ Evan Beard, CEO and Chief Engineer of Standard Bots, discusses the company's recent $200 million Series C funding at a $1 billion valuation, plans to quadruple manufacturing capacity, and the goal to account for 10% of U.S. industrial robot deployments next year. He highlights the need for domestic production, noting that nearly all U.S. robots are foreign-made, and emphasizes Standard Bots' focus on AI-driven, user-friendly robots that can be trained through demonstration. Beard also addresses the challenges of humanoid robots in industrial settings, suggesting that static or mobile bases with flexible configurations offer better ROI and performance.
He's the co founder, CEO, chief engineer, and he has a massive to announce. How are you doing, Evan?
What's going on, Steve?
Good to meet you. What's You're looking extremely sharp. The occasion? Introduce yourself. Tell us what's going on.
Thanks so much. Evan Beard, CEO of StandardBots. StandardBots is America's largest maker of AI native robots. Announcing today our series c, so raised 200,000,000 at a $1,000,000,000 evaluation, and we're announcing also Congratulations. For the gong. Yes. Now the fundraise is official.
Yeah. Fantastic.
We're also announcing we're quadrupling our manufacturing footprint. We're growing so quickly. We expect next year to be 10% of all US robotics, industrial robot deployments.
Wow. So how small is The US industrial robotics? They all come from Germany and Japan or China? Like who are the major players I mean, obviously, it's important to to re industrialize. But it feels like for such a young company to get so much ground, like we really have to be behind the ball here. Right?
Yeah. Last year we grew 10x year on year. We are behind the ball. When I first started the company, I did like Combinator. Cool. I looked around and realized I wanted to start a robotics company. I realized that almost all the robots, it's like 99.9% of the robots used in The United States are not made here. Yeah. So so that's the kind of starting point. And then you try the products, and you have these menus that have like a single letter in them.
It's like crazy stuff like you would expect from, I don't know, like mainframe computer type. Like Yeah. It's beyond any other software I've ever seen. And so we realized we could make something 10 x better. And then with AI now, obviously, you can train a robot by demonstrating a task. Whole new way to train it, can be more capable, handle more variability. So that's what we do.
Yeah. And it's probably not sold to like a technical audience. Not like Stripe for humanoid robots or industrial robots exists. The buyer's probably some firm that owns a whole footprint of manufacturing plants and they just say like, stick it there and figure it out later.
Yeah. So has the journey so far been about finding product market fits? Or has it been about just delivering an American equivalent of products that are already popular?
Yeah. It's a great question. When we first started so I talked to a 100 different manufacturers and I asked them, do you like your robots? Who programmed them? Can I play with them? How long did it take? What are they doing? It was really from the beginning, we knew exactly what we needed to build. And the and from the beginning, the problem was actually building it. It wasn't like, what do we build or how are we gonna reach the people or do they want it?
And and what's been consistent from from the beginning of the company, we did our seed round around 2020, has been, we build the next thing that we know people need and we see even more takeoff and even more accelerated growth. So that's been it's mostly been a technical problem which is what I wanted when I got into this whole thing.
Yeah. Yeah. It's great if it's great if demand is is is all there.
How vertically integrated do you want to be? I've heard a lot of FUD about actuators and small drone motors and all these different pieces deeper in the supply chain. You hear about the American company that is the brand or and it's all made in China or then the American company that's making the product for the for the American brand but then all their parts are made in China and and we're going through this process of working through the entire supply chain.
Let's just say this, John. He made he made that tie. That tie is a standard standard BOTS tie.
Here we go.
He's gotta go all the way.
You gotta go all the way. I didn't imagine. I don't
if Nike's Yeah. I try to do do I rep the American brands, but we're trying to make every single component of the robot with this fundraise in The United States, and we've already designed most of it. So we designed our own motor. We designed our own motor controller. Like, we we wrote the original firmware.
I wrote the original firmware to do all the motor control. 60,000 times a second switching electricity to, you know, make the magnet and the electric electrical the electrical electromagnet. Yeah. You know, so so we we vertically integrated on a really low level. Yeah. And now it's about vertically integrating the manufacturer as well. So that's the next step here.
What is demand like for American made industrial robots? Obviously, you know, people online, commentators, investors have gotten the memo about the importance of reindustrialization. But if you're just, you know, some American manufacturer, like you might not have the money, you might not really care, your customers might not care, like how resonant is this idea?
Yeah. Is is part of it people just like knowing that you guys will be stopping by the factory and things like like how are yeah. Basically like how are you differentiating besides like the country of origin?
Yeah.
Yeah. I know. So we our whole focus is training through demonstrations. So we have made made it so that an average assembly worker or manufacturing worker can train a robot and with our next software release, they can train an AI model too. And so this is it'd be the equivalent of if you could fine tune, like, ChatGPT without any kind of software engineering degree.
And we make it so simple and easy to show a robot what it is you want it to do and then have the robot go and do it on its own. And I don't none of the other incumbent robots there so far in the past that I don't think they're even beginning to work on this. And I think that there is a real potency to vertically integrating to be able to make the hardware and the AI stack and the software altogether because you can make it work better. And so that's what we do and that's what we've been focused on. And I think that it's it's that combination that allows you to go address all these tasks that otherwise you just can't automate today.
Are there many robotics led manufacturing robots? I'm thinking like, you know, a PE firm says like, hey, there's like a very specific type of manufacturer. They haven't adopted technology as fast as they could. We're going buy these companies, combine them and, you know, let's say roll out standard bots across their whole fleet.
We are working with a couple of those types of private equity firms. We have, you know, many hundreds of customers now. So there are some of those. It's a lot of just, you know, we so we've got small and medium businesses in almost every state. We have iconic Fortune five hundreds, oil and gas, data centers, aerospace, automotive.
So really spanning the gamut there. But it's people who are making the things that make America, the manufacturing components, also the end products that we use, and that that gets us up out of bed. Because what robots are today are really they're the tool for us to make our economy and our country manufacturing affects one third of GDP, one third of all jobs. And so if we can move the needle on those things, it moves the needle for the country. And that's why I've been I've been to testify to congress twice in the last few months, and this is a it's really across the aisle.
There's agreement that we need to dominate robotics as a country in this next and so I think to to your other question, it's very important, I think, that all the components are made here because we don't have this supply chain here today. And you don't want to have something that is so fundamental and foundational to the future of this country not made here. It's just not a good good play for for our kids.
Last question for me. How do you see humanoid robots fitting into our robotic future? How do you think they fit in, break down? I'm always shocked by this this stat that I think Amazon employs like a million humans but also a million robots or they've deployed a million robots while scaling their workforce into like the tens and hundreds of thousands. And there seems to be some synergy there.
I imagine that there's a lot of energy around humanoid robots but there's so many situations where you want a robot that just bolts to the floor with a lot of power that can just move a steel beam that a human can't perfectly Yeah. Repeatedly via demonstration learning. But how are you thinking about that adoption curve? Because I imagine there'll be some takeoff and exponential growth. But give me some nuance on what you're seeing on the ground.
Yeah. Our view is for a controlled environment factory filled warehouse that a legged humanoid is it's going to be more cost, more unique parts, but it's also going to be less efficient. So you just have a a worse ROI. Yeah. So we think maybe humanoids are right for the home, but then you have the safety issue. Like it
Yeah.
When it's going up the stairs, you need two five year olds to be able to jump on the back of it and pull it, try to trip it. It's the home alone test is what I call it.
The home alone test. Yeah.
Yeah. But I think we're years away from because like you see RL, robots flipping with RL and it looks impressive. I think the average person thinks like, oh yeah, it's all soft, robotics is soft. But I think to solve the to beat the home alone test, it's we don't you know, RL is not quite there. And it's hard to simulate all the things that an eight year old could do to to so you can't even do the RL right now.
Right? Because we don't simulate all the soft bodies and the meshes that are cutting. So it's it's an unsolved problem. I think it's going to be years away from being solved in the home. And in the factory, we make it as you said, there's a lot of applications where you just need a static base Or maybe you you you you maybe some you need is mobile based, maybe you need one arm, maybe you need four arms.
Yeah. So we have
a flexible platform where you can kind of mix and match depending on your needs, and we think that's the best ROI, the best performance. But humanoids are better at one use case. Do you know what it is? Raising money. So If
I mean if we're doing the home alone test at scale we're going need to rat massively revamp child labor laws because the five year old, the eight year old, they're going to be working forty hours a week paying for college, just beating up humanoids in some in some designed house. This is important work. No. I'm sure they solve it some other way. Synthetic data perhaps.
That's a good
Anyway That's
a really good line.
That's a good zinger. Thank you so much for coming on the show. Mark. Congratulations.
Yeah.
Congrats to the
whole team.
Appreciate what you're doing. Glad you
guys are doing what you're doing.
And looking sharp. We'll talk to you soon.
Thank you.
Have a good rest of your day. That's fantastic. Let me tell you about Shopify. Shopify is the commerce platform that grows with your business and lets you sell in seconds online, in store, on mobile, on social, on marketplaces, and now with AI agents. And our next guest is already in the waiting room.
¶ Nick Leisure, co-founder and CEO of Sandstone, discusses the company's recent $30 million Series A funding led by Lightspeed and their rapid growth, deploying legal relationship management tools to dozens of Fortune 500 and mid-market companies, achieving a 40x business growth in 150 days. He highlights Sandstone's focus on centralizing intake and knowledge for in-house legal teams, enabling effective AI workflows, and differentiating from traditional contract lifecycle management tools. Leisure also addresses the evolving role of AI in legal services, emphasizing the need for experienced in-house counsel and the increasing importance of technical roles within legal teams.
We have Nick Fleisher returning to the TBPN program from Sandstone. He's the co founder and CEO. How are doing, Nick? Good to
see you. Great. Great to be back. Great to be back. How are you guys?
Great to see you. We're doing great.
Overnight success. What's going on? You raised some more money? Tell us about it.
We we we raised some more money. Today, we announced a $30,000,000 series a led by Lightspeed.
Nice. There we go. You're moving
at Lightspeed. Tell us what's going on. What's the traction? What's what's the unlock? What's the actual product doing for people day to day?
Yeah. The the product is legal relationship management, which means we centralize intake and knowledge for in house legal teams so that they can actually, deploy it in AI workflows that that are useful. Since we launched about a hundred and fifty days ago, we've deployed to, you know, dozens of Fortune 500s and mid market companies across industries like manufacturing, commerce, tech, and we've grown the business by 40 x. The team has tripled since we last spoke end of January, and we're excited about bringing this this tech to legal teams who are really in need. You know, we we like to say that we are playing against a legacy market, which is called contract life cycle management.
Very boring tools where in house teams historically store contracts, and that's about it. And they are, you know, burdened and gated by that piece of tech, and we wanna help unlock them so they can actually, you know, use use the great AI that's out there now.
K. Your investors haven't exactly sat out the foundation model race. There's been a lot of thud around rappers and application layer companies, all sorts of derogatory terms thrown around. At the same time, we just saw data from Cursor, Cognition, a couple other firms that appear to be in the direct path of the AI labs. They're all growing. They're accelerating. They're doing great. How did you frame that question during this round of pitches?
Yeah. And I mean, Claude is, you know, Claude has announced Claude for legal. OpenAI made a big hire Yeah. Last week in the in the legal tech space. And so they're they definitely want to play and I think most of where we see them playing is on quick legal questions, legal research, and redlining of documents.
Yeah. And we explicitly said from the start, we think redlining and marking up documents is gonna be commoditized by the by the labs. Interesting. And so we said we wanna actually build a workflow tool that's helpful for in house teams. And so, you know, even the most forward thinking tech companies are paying us, one, for opinions on what those workflows should look like and how to implement them.
Two, the context layer to actually think about, you know, how does each legal decision and relationship map, you know, to everything else, and how do we, you know, retrieve that at the right moment so that we're pulling the proper context when I'm answering a question or looking at a document. And then I think the final one is, you know, building a tool that learns from your past legal decisions and can work for not just the stakeholders within your legal team, but also the the folks in the business who are requesting work from legal, that's a lot more complex than any, you know, chatbot or or self built tool is gonna is gonna be able to do.
Yeah. Has token maxing hit the the legal community in any way? Interesting. I would assume no because there's maybe a more like finite amount of like companies aren't, you know, a software company wakes up in the morning and there's like, there's so much software to build. We wanna build as many individual features as we can.
You know, there's stuff to build internally and externally and all these things. Whereas like an in house legal team is not necessarily waking up and being like, we want a 100 x the amount
tech company might go back and say, review every line of code in our code base for bugs. A law firm probably isn't going back and saying like, review every document we've ever sent and do another red line on it when our client's not paying us. Sure. But what how how have you been interpreting it? The token maxing question.
I I think I think generally, we we don't see that happening. We don't see it happening at scale, but you could see it in a world where people say, hey, can you redline this or review this agreement or answer this question in the 50 different ways that is that, you know, we potentially could and see how it plays out in a negotiation. Right? Can we simulate what the outcome could be here? And so I think we see some people playing with the idea of, you know, using AI to do things that are maybe outside of the the day to day.
But, you know, I had a GC the other day on a demo tell me we are definitely not AI maxing today, and we won't be doing it soon, and I think they are much more cautious. And historically, legal is seen as a cost center and a bottleneck. I think that's going to change a lot over the next couple months, but they are the last ones to get the, you know, ridiculous token limits and and ability to go do those experiments.
Yeah. That makes sense.
Much effort are you putting into, like, harness development specifically these days? It feels like that was the unexpected win of the last, like, six months across Clog Code, Codex, Cognition, what they're doing. Like, people at least a year ago or two years ago thought, like, the model will be everything. Everything's gonna be in the model. You're not going to like this whole prompt engineering thing sort of evolved into harness engineering and it's borne fruit for so many firms.
Are you focused on that?
Yeah. I mean, one of the things that we'll do with clients is we'll say, hey, take all the integrations that we have that you have connected through Sandstone and connect them with MCP and to Cloud and OpenAI and and just see what, one, the quality is of the, you know, ability for it to retrieve context and answer your questions, and two, the the cost because you're not necessarily routing to the the right model for the given task. And so, you know, if you do that experiment, you're gonna see that, you know, 50 x the results on on the Sandstone side, and that that happens with nearly every legal request that hits a a legal team within a company. And so a lot of it is around how do we map data and context from other systems actually go retrieve that, you know, when these questions are being asked or when we're reviewing documents. And then a lot of it is also just the, you know, underlying decisions around what models to be using when.
Typical path in law, at least from my understanding, is usually like law school takes forever, a couple years at a corporate law firm, then you can make the jump to in house counsel somewhere. Yeah. Is AI going to lower the age requirement, the experience requirement for in house counsels? Like, should should will we should we expect to see 10 person start up, 20 person start up say, yeah, let's get someone who just graduated. They passed the bar.
They're a lawyer. But instead of them spending five years at a white shoe law firm, let's have them jump over because we know they're going be super powered? Or how does the dynamic play out on that side?
Potentially, I I think we will see some of that. The two the two pushbacks I would have are one, you you wanna hire a GC or an in house lawyer who has experience dealing with different types of counterparties so they can actually, you know, go up and have the negotiation and and, you know, have a good backing and background when they come to those conversations.
And I think, two, you still gain a lot from sort
of the hustle and the grind of all of the work that you do in big law. Yeah. That will decrease a
little bit, but I don't
think it'll go away completely in the next five years. I do think we're going to see more non lawyers on in house legal teams.
Like, we
have some clients who have hired engineers fully to their legal teams, and historically, has had this role called legal ops, which is essentially, you know, if you think about rev ops on the the revenue side, it is sort of the person who, you know, pulls everything together, the systems, manages the processes. These people are becoming more and more technical, and I think we're just going to see a lot more of them. Like, know, you look at Mercury's legal team, I think it's in the, you know, 20 to 30 person legal team range and, you
know, they
have several people doing legal ops. Historically, it would have been maybe one or, you know, at most two for a 30 person legal team. But we see people focusing on it more and more.
That's very cool. Are you tracking on the on the consumer legal side? Like legal Zoom, this is sort of out of your wheelhouse, but I'm just sort of interested Yeah.
Well, it's more more interesting to ask you than
Yeah. Somebody that's actually building an space. Legal Zoom was like so magical. Initially, was form filling and then we got Stripe Atlas. But is there more there? I mean, people are going to go to the models and demand legal advice one way or another. Jailbreak them if they have to. But how does that market change? How do you think what do you think is gonna happen in that market? Is there anything interesting you see as changing?
There's so much opportunity. Right? Like, those tools are historically very much just mapping you to the right person who can do the services, and it should all get disrupted, and there's very little investment and focus there. So like if I was starting another company today, like, that's a really great market, and I think it's very specialized, right? You see some popping up on the consumer, divorce and family law side, and we'll see that in all the different areas.
The the other thing is just law is getting more complex, and there's a lot more of it because of AI. Right? All of our clients are telling us they're busier than ever because, you know, the people in the business are negotiating more. They're doing things with AI that they shouldn't be. They're creating more text and more words. Right? The business users are token maxing.
Yeah.
And so as a result, there's just more legal work. Right? And there's more regulation. And so you're gonna see people wanting cheaper options for getting the answers to their questions and getting through cases.
Yeah. Tyler Cowen had a funny take on this. There was like, even in the most aggressive ASI scenario, you're going to have tons and tons of government lawyers because we're going to want the humans to write the laws that govern the AI and whatnot. Anyway, thank you so much for taking the time to come chat with me.
Fantastic progress. Congrats on the 40 x to the whole team.
We're going
to hold you to that the next time you come on. Better be a 40 x.
Ideally, ideally accelerate.
Yeah. Yeah. Maybe
400 x in a hundred and fifty days.
There we go. Just call him the shot. Call him the shot.
Love it.
Have a great rest of We'll talk
to you soon. And
I'll tell everyone about MongoDB. What's the only thing faster than the AI market? Market? Your business on MongoDB, don't just build AI, own the data platform that powers John.
Yes. Did you know that Dwarkesh Patel's assistant is the brother of Leopold's fiance's boss?
I heard that I heard that Dwarkish Patel's hairstylist's uncle went to school with Demis at DeepMind in preschool. And so I thought that was something that needed to be disclosed.
I think you're thinking of it as the preschool teacher.
The preschool teacher. That's right. Okay. Well, yeah. News flash, Silicon Valley is small place. And in fact, this is so funny because it's like, actually all the people in AI live in the same house.
That's Yeah.
That that's the real story here. It's not that there's some crazy It's assistant is the brother of the boss.
A small And you're not in it.
Anyway, it's very funny that somebody tried to drop this as a bombshell
Yeah.
And and wound up writing one of the most confusing lines on No, it's not in.
We're still creating new sentence structures.
We are. We are. Never before in the English language is something so confusing. Before Before we bring in our next guest, Chris, Ninja Wan.
We have Paul Graham said
What did say?
I strive to make my writing unsummarizable in the sense that it has so little fluff left in it If that you take any words out as summaries by definition do, you lose a lot of interesting ideas. And so he says, well And they quit.
Why is this block three d?
Blocked out the rest of the text.
But why is it three d with a beautiful light gradient rip like flourishing off of it? Like, I don't understand the the like, you could have just gone into iOS, put a little black box over this or blur it or something. They chose to put a three d block there that's
I like
with a blue light and a white light on the right. It looks very aesthetic. This feels But
Paul Graham fires back and says, are you trying to prove my point or just doing it accidentally? If I'd written just that, no one would have understood what I meant. The only reason people can understand your version is that they can also see the original.
Owned. I wonder I wonder is I strive to make my writing unsummarizable a banger? Do you think that one gets more posts, more likes? They originally got 5.2 k likes. Do you think I strive to make my writing unsummarizable gets we got 66,000 with this, but that's because it's funny. Anyway, we can debate that more in the future. Let's bring in our next guest. We have Chris from Ninja One. He's the president and cofounder. He's in the waiting room and now he's in the TBPN Festival.
¶ Chris Matarese, co-founder, President, and CFO of NinjaOne, discusses how NinjaOne addresses the complexity and fragmentation in IT management by unifying various operations into a single, modern, cloud-native platform, enabling organizations to reduce costs and simplify workflows. He highlights that the average NinjaOne customer replaces seven point solutions, thereby eliminating inefficiencies and security risks associated with managing multiple tools. Additionally, Matarese emphasizes the company's adaptability, noting that while NinjaOne aims to provide comprehensive solutions, it also integrates with existing point solutions that customers find valuable, ensuring a seamless and unified IT management experience.
How are you doing, Chris? Good to meet you.
Great. How are you?
Nice to happen. It's massive news, but it is your first time on the show. So I'd love a little introduction on yourself and the company first, and then we can go into the news.
Great. First, thanks for having me. I'm a big fan of the show.
Thanks so much.
It's an honor.
And I'm a local in La Canada, so pretty close to No where you guys are.
Pasadena. That's amazing.
Yeah. I knew that. But I'm Chris Miller, founder of Ninja One. At Ninja, we believe the hardest problem in IT today is complexity and fragmentation at scale. Mhmm.
As organizations are stitching together literally dozens of point solutions just to manage, protect, backup, and support their endpoints. You know, and that fragmentation costs it creates cost, risk, poor service, etcetera, and Ninja solves this challenge by bringing all of these operations into one unified modern cloud native platform. You know, in short, we really just help our customers reduce spend, unify IT, and simplify work. That's that's our thesis.
Okay. That makes a ton of sense. And I think anyone who's been inside of a big organization has felt that. At the same time, point solutions point solutions are great sometimes. And I'm wondering about how you do the dance between, well, we're so baked into this, we're so locked into this or only this point solution does this particular strategy or technique for us or solves this problem for us.
We just can't rip it out. How do you integrate different point solutions without having people actually need to pull back from the software or solutions that are providing real value?
Yeah. I mean, well, first of all, we try to create our own solutions that are all unified together so we can place all of these point solutions.
Wow.
The average Ninja customer replaces seven point solutions.
Wow.
And I think our whole key, we're a product led company.
Yeah.
You know, our thesis is to build the best possible product. So we think we've built some of the best possible point solutions, and unifying them together not only saves, you know, IT teams, you know, hassle, complexity, to manage all these solutions, but the nature of having multiple point solutions is there are gaps between the solutions.
Yeah.
And those gaps, you know, not only are inefficient, but they create vectors of attack and risk. So by unifying those, we eliminate those gaps. Now if there are great point solutions that we feel like we don't have, you know, an answer to, we integrate them into our platform. So our IT teams that use Ninja have one pane of glass, you know, fully integrated. Hopefully, they've removed, you know, 10 solutions.
They're using Ninja to take care of all of their problems. And if there are one or two point solutions they love that, you know, they can't replace a Ninja, you know, we have integrations for a lot of them.
You have some huge customers, Deloitte, Porsche, Hyundai, Carnival Cruise, they're all companies that people know, Kawasaki, Birkenstock. But at the same time, have 40,000 organizations on board. So what does the long tail look like? What's the smallest customer you're working with? Like, how are you positioning yourself in the market and winning deals?
Yeah. I mean, people ask me who is Ninja's customer, and I'd answer it's every business in the world literally is a potential customer.
Wow.
So for small companies, we sell through MSPs, are managed service providers. They may manage, you know, six local accounting firms and two law firms and a pizza shop. And you know, all the way up to the largest enterprise customers, you know, we've got some very large, you know, Fortune 10 customers we can't name. But so we can literally service everybody.
Was Talk about the sword. Oh, yeah. The sword.
Game of Thrones fans. So for those of you who watch Game of Thrones, that's a jump.
Do they have do they have flash do they have flashbangs in Game of Thrones?
I don't think so. We're doing flashbangs. We have flashbangs here on I'm the
a big video gamer too, so
they Flashbacks. What games? What games?
We play everything. Okay. I actually started a couple companies that were video game companies. No way. My cofounders, they're really big into Call of Duty, so we've got Call flashbacks in Call of Duty.
They also got smoke grenades in in Call of Duty. Are you a
I have tomorrow at the strategy games.
Are you? Are you a Counter Strike? Oh, you're oh, you're more strategy games. Okay. Wait. Wait. Four acts or or, like, Age of Empires, or are we doing Hearts of Iron?
You know, we've done Age of Empires, you know, but even games like Hearthstone Hearthstone's great. Okay. Even my partner and I actually started playing Axis and Allies when we were kids. That's a great We always say Ninja is one big strategy game. You know? It's just a high stakes strategy game, but it's it's still fun.
Love it. My business
is so addicting.
Is it getting more is it getting more high stakes in the age of AI? Is it because of security risk? Or is it a pure accelerant to your business? Like how have you been processing the last few years? It feels like it's a great place to be with 40,000 organizations, 140 countries, lots of opportunity. But what is the shape of the impact actually been?
Yeah. One thing I'd say is the 40,000 that's 40,000 customers. I mentioned some of those customers are MSPs that service hundreds of Sure. Wow. So we might have close to a million businesses using Ninja.
Woah. That's crazy.
But as far as AI, we see AI as a real tailwind, you know, that's been accelerating our growth and it's going to continue to accelerate our growth, you know, for three reasons. First, we monitor devices,
Mhmm.
And we've seen over the last several years device proliferation, and I think we're gonna continue to see that. You know, it's it's laptops, computers, but it's smart watches. It's
Microsoft launched some, like, smart badge and, like, Microsoft launched a desktop device and, like, it's clearly leaking into everything.
Even fast food restaurants, you know, it's it's not only the computers in the restaurants, it's not only the point of service equipment, the order boards, but now that the fryers are endpoints, the grillers are endpoints, and we monitor all of those. IoT files With and and even more devices coming in. The more devices, the better it is for us because that's more devices for us to manage. So, you know, that's one real tailwind. Secondly, we're incorporating AI into all of our products.
So AI is making our product more efficient and more powerful and thus more valuable to our customers. And we're also coming up with a number of AI native products that we just released, the vulnerability product, we have a patch intelligence product. And then finally, and perhaps more importantly, and we've seen in the news even today, that AI is creating more vectors of attack. So, more vulnerabilities are exposed, more things are being need
to
be monitored and managed because of those vulnerabilities, and they need to be patched quickly, and that makes our product even more valuable.
Very cool.
Well What where where is the company based primarily? You said you said you're you're in LA, but is the company distributed?
I'm in LA, but we're all over the world. Our largest offices, you know, are in Austin, Texas, Florida, and Berlin, Germany. But we've got offices in Australia, England, Singapore, Spain, Philippines, you know, I don't know, Indonesia, a bunch more.
Global. I love it.
I love it. Well, thanks so much for taking the time to come talk
to Yeah. It's great meet you, Chris. Thanks thanks for coming on and congrats on a massive milestone. I'm sure you'll be back on very soon.
Yeah. I don't think we hit the gong. Tell us Yeah. About the got it. We much did you raise?
So we raised 400,000,000 in certain constituents at a 12,300,000,000 company valuation.
Fantastic. There we go. Doubling the valuation since February 2025. Thank you so much for taking the time to come
not at all.
Have a good rest of your day. We'll talk to you soon.
Great hanging out. Remarkable ability from Chris to be completely unfazed by the flash bang.
And this
He just didn't even and the smoke grenade.
Just like I guess this is how it
Just another day another day another day at work.
Yeah. Where should we go next? Pat McAfee is negotiating a new deal that can pay him over $60,000,000 a year for from ESPN. This is in The Athletic. Big news for one of our biggest role models.
ESPN and representatives for Pat McAfee are discussing an extension to his contract that would pay him more than 60,000,000 per year. Deal's not completed yet. And if an agreement can be reached, could be a sliding scale based on his new responsibilities. McAfee already omnipresent could be on the air even more with a bigger role in NFL coverage. I'd love that.
And last night he had a like watch along like on actual TV for the the Knicks game.
That's super cool. Yeah. And and he's been brought into the the college football ecosystem and been a really important voice there. He's 39, two years remaining on his current contract and he's a college game day panelist and has various appearances on other on other programs. The makeup of the new deal would be similar in structure.
ESPN's view the arrangement as per a production contract and a separate talent agreement differentiating it from the deals with most of the on air personalities. Host three hour daily show with his crew, the Pat McAfee show. The first two hours are on ESPN of all three are on YouTube. Very interesting split there.
Let's head over to Verizon CEO, Dan Schulman. Talk about some of the advantages he's getting, he and Verizon are getting out of AI.
Okay. Let's see.
In the last three months, we've been experimenting with agents that are replacing some of our customer service reps. And those agents, their customer satisfaction rate is 1,280 basis points better than than what we had before. 1,080.
Basis point increase. That's a that's a thousand basis point lift. Think about that. 1,200 basis point lift. That's 12%. If you're putting it in normal terms It
really does sound way more than 12
It sounds like a 100 times as much because the number's a 100 times bigger. But as a reminder, if you Dan Schulman, the CEO was in the Wall Street Journal recently for preaching straight talk about AI and job losses. This was in April 19. And he claimed that within the next two to five years unemployment in America would be 20 to 30%.
So what is that? 2,000 or 3,000 basis point?
Yeah. 3,000 basis point unemployment rate. He warns that advancements in humanoid robots could upend the manual labor jobs still seen as safe today.
It is notable that people outside of AI actually have the most aggressive near term predictions
Yeah.
Around employment.
Yeah. Yeah. Well, I think a lot of that is that the the actual idea of job losses and whatnot, that came out of like the most insidery tech, like the less wrong, the the the Dwark Hesh Patel podcast where people were having very mature conversations with a lot of caveats. A lot of like, oh, here's my probability distribution for if this happens, then this happens. And if we don't do anything about it, then that will happen.
And and in reality, a lot of things well, oh, okay. Well, if if the unemployment rate spikes we'd cut interest rates. Right? Or like we do like more federal jobs or you know there's a lot of things that could happen but those those quotes were taken out of context where it was like in isolation if only the bad stuff happens and none of the good stuff that would mitigate it happens, you could land at and then the original thing was Dario saying 50% of early stage white collar work which still puts you at less than 10% unemployment rate and then he revised that down to 10% unemployment more broadly which is still lower than this. And then people took it and were like, well, the smart guy who just put up a 10 x annual run rate year said that I should go a little bit further.
I got a 10 x out again.
I got a 10 x out again. And then and then you wind up with we saw that iced coffee hour clip of someone saying what was it 80% of jobs? I think is it 8080%? I've heard 50% multiple times. And then Luke Belmar that influencer said, oh, 100% of jobs. And so like you just
It's notable though they never it's never their job. No. No. It's never their job. Never. It's always everyone else.
Because you need to be scared and you need to come work for me.
And get by the court.
Quit your job now. Come work for me for half what you're making.
One more post bring out
our next guest. Meredith
says it's so easy to spot AI writing because it always sounds like it was written by a fedora.
Silly. Let me tell you about Railway. Railway is the all in one intelligent cloud provider. Use your favorite agents to deploy web app service databases and more while Railway automatically takes care of scaling monitoring and
¶ Alex Heath is the Deputy Editor at The Verge, where he covers major technology companies, AI, social media, and the future of consumer tech. He is also the author of Sources, a newsletter focused on the inner workings of Silicon Valley and the biggest stories shaping the tech industry.
See if the Heathenator has.
And without further ado, let's bring in Alex Heath. He's the author of Sources, the Heathenator. Well Heathenator. To the show. How are doing, Alex?
Always scooping. Not afraid to use AI. Do you ever throw on the fedora when you're you're going to
the prompt. Don't talk like a fedora. It sounds great.
Don't talk like a fedora, guys. Yeah. Although I am excited to deliver the first Fable Yeah. Newsletter Okay. Later today or tomorrow.
It's going today. But you
had the you had the leak or the scoop yesterday. You were the first person I saw the media. Congrats. And
sources we trust, gentlemen.
And sources And I honestly use sources as an example where like you could use all the AI in the world. You could say like, I don't even touch my keyboard. I just sort of dictate to the AI the things that I know and then I and it publishes. And it wouldn't make the product worse. Right? Because like I'm coming to you for like facts, like new new information
More than
plus your takes on like how you think about something and however it gets into Substack doesn't really matter to me. Yeah.
So Anyway. You're saying you don't like my beautiful pros?
I love your pros.
No. I I think it's great but I'm just saying like but that's not why I I, you know, I subscribe because of like who you are and the access that you have and the insight but I don't care like Yeah. If it was you clacking the keys, you know?
You know, it's funny you bring that up. I've been having some conversation with open claw pill folks recently, and they've been telling me to build something like it. I shouldn't maybe even be saying this in there, maybe I'm giving away some some alpha, but build a kind of real time MCP hook into my brain essentially Mhmm. To just deliver infinitely personalized agentically delivered media and reporting. What do guys think about that?
Wait. Actually personalized? So like
Well, it would be personalized by the person's claw agent, what have you. Right? Because the idea is the way that I decide to present a story is one way. Yeah. But there may be things in like an hour interview that I don't even put in the story that may be hyper relevant. Yeah. Especially if it's delivered identically.
And and and also that actually does that does feel like the more modern instantiation of the sub newsletter list. Like you go to Bloomberg and you're like, want the markets newsletter, the tech newsletter but not the politics newsletter. And with an MCP server or some sort of AI intermediation I could say like give me the WWDC scoop Right. Pass on whatever other scoop is less interesting to me like you'd know all my preferences and then you can pump out a lot of different stuff and find very high delivery rates based on what I'm actually interested in at a particular time.
Yeah. I I mean I have a throughput problem of getting reporting into the world, right? Sure. And so it's a good problem to have but what it means is like WWDC yesterday is a great example. I went to that tech talk that Craig Federighi and all the Apple execs did.
Yeah. I broke out some stuff that seemed interesting to the widest possible audience, but, you know, there's a lot there. It was like an hour of stuff. And like, what if you just had direct, you know, IV drip access, you know, for your agent to to my reporting in the rooms I'm in.
Yeah.
I don't know. We'll see.
Yeah. Yeah. I mean, I'm sure you'll be the one building
Good time to be experimenting.
Anyway, on WWC, what like what was your reaction? What was your expectation going into this? And then like what were the biggest announcements stuck out to you specifically? Because I yeah. I mean that's really what I'm coming for is I want I want your interpretation even if you give me even if you run an L and clean clean up the final language, I want your taste applied to this question.
I think they finally have a Siri that works. It's arguably what they should have shipped two years ago when they had that big trailer with I think it was like people on an airplane and it was it was doing all this agentic stuff on the phone. It was like, wow. It's crazy Siri can do this. It didn't do that right.
Yep.
They had to basically apologize for it. They rebuilt the Siri stack to be, I think their word was expandable, so more modern, more AI native. And now, you know, actually this morning, I was in Cupertino for a hands on with the new Siri. So I got to see it in-depth and ask questions about it. And, you know, it is a step forward, but there's basic things about it that if you're if you're claw pilled or you're using codex or in chat all day, you're still gonna be like, for example, it doesn't have persistent memory.
So it's not it it kind of forgets everything in each query. They haven't built that yet.
I wouldn't have expected that. Hold on. We we I wouldn't have expected that because it feels like that's a source of like memory is is not like the number one feature that people benchmark the current models around. They're like computer use, MCP integrations and like can it can I can I set codex or clog code to run for like nine hours and it comes back with something really polished and just does writes amazing code? The memory thing feels like personal super intelligence feels very Apple and they have all of this.
That's that's very surprising to hear. Anyway, what else, Tucker?
It is. I think they're moving very slow and they're very worried about the privacy aspect Yeah. Of all this which I don't know if people really care about this with regards to AI. They seem to think they do. I think we'll see. Maybe there'll be a Cambridge Analytica moment for AI, and then that will wake everyone up. I don't know. They're seeming to think that will happen.
Yeah.
There was a demo you brought up computer use where they were showing the news Siri and and Apple intelligence powered by, you know, Gemini and all that stuff on a Mac, renaming folders and renaming files inside folders. And, you know, if you use computer use in Codex or Claude, co work, like, you can do this. It's very easy. You can abstract it away from a prompt, but you can't actually even do it via a prompt in Siri. You have to do it via the menu, right click, have Siri do something, and and or do it through shortcuts, which like I don't know
if you
guys use shortcuts. I don't use shortcuts.
The last shortcut I've used was to remap Siri to ChatGPT actually like two years In 2023.
In January of Yeah. 2020
It it would it would take whatever I said and fire it off into the API and Yeah. Spill it back to me. It was sort of meh.
Yeah. I mean, I feel like one of the challenges for Apple is like software is moving more quickly than ever. And the Apple kind of ethos and approach is this annual release and like, let's make everything perfect and all the stuff. And it just feels like a really, really tough challenge to be able to and and it's not to say that they need to be at the frontier of everything. Right?
Like, all anyone's been asking for is just like a usable version of Siri. Like, I haven't prompted Siri I haven't gone to Siri for anything in
set timers.
Set timers? That's the weather.
Good That's that's a good use case.
Weather.
But even then, I'm so but but anyways
But getting better. The other the other big thing about this new Siri is they have really nerfed the ChatGPT partnership. It's you know, that was a big thing a couple years ago. Right? And you have to prompt it each time to send something to chat.
You have to do it via text, so there's not even, a software UI element of this anymore. So I was actually thinking about, like, meta narratives for WWDC this year. And and one is that, you know, the Google partnership, obviously, which we could talk about. But the other is I really think there's this OpenAI is kind of like the new Facebook to Apple where they they work together closely. If you guys remember when Steve Jobs and Mark Zuckerberg integrated Facebook and iOS, Facebook had, you know, a bunch of its, you know, press challenges, privacy challenges, etcetera.
And then they just kind of drifted apart, and then it became this, like, messaging war, and you started to see that bubble up yesterday with Craig saying stuff about, like, we're not gonna have ads or just these subtle hints that they have, like, ideologically drift away from from OpenAI and on chat, GPT, and that partnership has not gone well. That was another big thing that, that stood out.
So on the on the actual integration
And that's somewhat, I mean, somewhat to be expected. Right? Like, you you can't like hire Maybe.
John I
mean You hire you can't hire like Johnny and say like we're gonna Oh, yeah. We're gonna create
a bunch Yeah. Of
And poach a bunch of people and then expect like it to all be good. And and in so many ways, makes sense for Google and an Apple.
Because Google and Apple have been working together They have some perfectly for years at the search partnership. It feels like a search Enemy
of my enemy is my friend kind of thing.
Yeah. I
I I think so. They they know Google well, and then a bunch of Google people have come into Apple to reboot the AI strategy. Yeah. And it the the whole point of that very unique, which Apple's never done this by the way, and on the record, like, post keynote thing with their execs. It was very unique.
We got in this tiny theater, got to ask Craig and the execs questions. He did this, like, I called it AI in the newsletter, called it AI one zero one. He had this, like, almost whiteboard like graphic where he was explaining AI stacks, how they work normally, how Apple's works, and really doing a lot to try to show that, yes, they're distilling on Google, but they really control everything. It's insanely post trained on everything Apple wants. It's not going to give the same kind of responses that Gemini would in a Google surface.
Mhmm.
And I think that was the point of that entire thing was to just say like, yes, we're working with Google on AI, but we're not actually using like the Gemini product.
I wonder if it's gonna have its own
stylistic Salami bench where you tell where you tell Siri people if you tell Siri or if you tell Gemini that you've had a kilo of salami, it will tell you to dial emergency services. 999.
You tried this personally, Jordy?
No. No. But there's been some chatter about it.
Yeah. I wonder if it'll have its own turn of phrase like it's not this, it's that or you're absolutely right. There's like all these different phrases that each different model sort of like leaves its touch tone.
About there's only a certain set of devices that the new Mhmm. Siri is going to work for. I think there's
anything that Apple Intelligence runs on right now.
And then and then the latest models can do or the latest phones with 12 gigs of RAM can do the, like, the highest tier. And then beyond that, you go into the Apple private cloud, which is NVIDIA GPUs in Google Cloud platform, which is like their own thing. Have you dug into like where in Google Cloud it's going? Because they just did Like that where? SpaceX for Colossus.
Oh. And that feels like and that feels like not perfectly in line with like Apple's commitment to environmental considerations necessarily.
I think that's gonna be a way slower ramp than people realize. Okay. So for to start, the new Siri is only in English. It's not in China and the EU.
Okay.
And they're doing a beta invite waitlist approach Oh, this
makes so much sense.
I think through the year.
Because I was looking at, like, a billion users. If a billion users are even just asking for set a timer and it's doing inference, like, that's a ton of tokens and we've seen the ramp at Google as they've stuffed everything everywhere. Like Yeah. They're they're just gonna wind up with a big token budget at some point, but it sounds like it's a wall crawl run strategy. I think it's
a slow ramp. They were showing us some of the new photo stuff, photo retouching, removing things in photos, and it would take it, like, twenty five seconds to, you know, change the backdrop of an image. So they're doing cloud inference, but there again, it was, like, even in in the demo in Apple Park yesterday on launch day, it was, like, slow, and there were bugs because they were like, yeah. Our servers are melting. Wow.
We're getting way more interested in this than we thought. So I think they're gonna take a very slow approach, but that was actually the number one question that people were asking was, what are the interest cost inference costs of this? How is Apple doing this? Yeah. And like how big are they actually going with GCP? But I think it's gonna be a slow ramp.
Yeah. Because I mean, if you look at the, like, leaked financials from the AI labs, like, we're we're not in this paradigm of like training is the only cost. Like inference does have cost. It does CapEx associated with it. And Apple has been telling a very beautiful story of like, hey, we're sort of an AI winner without any of the CapEx.
But if you start offering inference, you're going have a Google Cloud bill. You're going to need data centers. You're going need clean data centers that take longer to build. And all of that is going to show up at some point. But I think the hope is that they're just not jumping the gun. They're not stretching themselves. They have the cash. They have access to the debt market.
What's the latest on liquid glass?
Oh, yeah.
Liquid glass.
You know, they barely talked about it, and and they didn't talk about the Vision Pro really either, which is where you see liquid glass kind of at its fullest.
I love
that product. Certainly on the backdrop. I know. I'm
the biggest user. Oh, you are? I love the Vision Pro. I watch movies in it. You use it
on a plane?
Yeah. But mostly,
like Oh, you're that guy.
I I'm that guy. Yeah. I know. I love it. It is the anti brain rot device for me. I put it on and I'm not on my phone and I just watch a movie. I watch Citizen Kane. It's a movie that would be like, you don't want to watch Citizen Kane on your phone. You don't want to watch it. And even if you watch on the TV, you're gonna get up, go get popcorn or like check your phone. Somebody's gonna text you. You're gonna Laughing
at you.
Because it because it's slower watch Citizen Kane From start to finish, my Apple
Vision Pro. Lawrence of Arabia. It's incredible. Lawrence of Arabia. It's a three hour movie. It's hard to to make the time to sit Do
you mind if we pull up an image of you on a plane using a Vision Pro?
Do you actually have one?
Ben has one.
Wait. Really? No way. No way. Yes. Yeah. Let's pull it up. Yeah. Can pull this This is hilarious. When did this happen?
This would be Must have been
a year ago.
Yeah. Yeah.
Yeah. Were you in the ad? The Apple ad?
It should have been.
I'm a believer. Put me
in the ad. Pull it up boys. There we go. There we go. I'm I'm that that guy.
Boys, are we even in business in this? Like, what what does this see?
That that could that could very well be This is economy premium. I think it's just years
of economy premium.
Was that that
was years ago.
I spent my last dollar on the Vision Pro. Okay?
Okay.
I don't know what's going on in this photo. This is
a long time ago. This is fun.
It's incredible.
Anyway, they did launch a feature for Liquid Glass. You can turn it off now. There's a slider that's basically an off switch, which is very fun. Yeah. But, you know, listen to your users, I suppose.
Yeah. It took a backseat. I mean, everything was all Siri. I've actually never seen a keynote so focused on one product. Yep. Apple usually does this state of the union across all the platforms, and, like, you get fifteen minutes on CarPlay. You get fifteen minutes on Vision Pro, all that stuff. It was basically an hour of Siri.
Mhmm. Have you been tracking any backlash to spatial reframing? Spatial that's what it's called. Right? Like, it's good because
I saw that up close Spatial. In my briefing. Yeah. Oh, people,
like, were booing there or Wait. Wait.
Wait. No. No. I didn't there was no boos. I'm saying I was in a briefing where, like, a product manager was showing it to us and letting us play with it.
Yeah.
Yeah. It's pretty cool. I mean, yeah. I mean, Apple is like they said, like, you we're not gonna let you put a dragon in a photo. Like, we wanna try to stay real to the essence of a photo. Mhmm. But we know that there are ways that a photo could look better with AI
Mhmm.
And whether that's reframing or whatever. But, yeah, they're not gonna do, you know, mid journey level Sure. Gemini level, nano banana level stuff. Yeah. But it's it is this whole, you know, idea of like, what is the photo saying
for the
dragon community. Yeah. Yeah. If you're in the coming out. You're into live action role playing, LARPing, or the Renaissance Faire, like You're back.
Yeah. You're an Android user probably. But yeah, I mean it is interesting that like there's a backlash to AI. Apple was like they missed AI but like the silver lining there is that everyone sort of sees them as like they're holding the ground. They're saying no to putting AI everywhere and it's like actually they maybe just didn't have the people in the right places at the time like they totally would have loved to do it.
They actually acquired an AI company in 2011 called Siri for hundreds of millions of dollars. They were ready to go and they just sort of like missed on the rollout. But now now I did see like a small bit of backlash to the spatial reframing saying that like I know Apple as the camera company. What you see is what you get. There's not the images aren't over processed and so this is like, you know, they're leaning into AI too much.
But I don't think it'll go anywhere. I think it's I think it's pretty moderate.
You can already remove things in the photos app with the retouch tool or whatever. Like this is
Can you? Have you tried to remove something from the image with
the iOS 20 and have not been able to. So I guess maybe I'm
it it looks like a it looks like a content aware fill attempt from like a few years ago. It is not at the level of any of the Frontier AI image models. Well The new version is flawless though. It is good. So they fixed it.
I saw flawless. They showed us doing it to a boy who was covered, like his leg was partially covered and they took something away and it made his leg super long, like really awkwardly long.
Maybe they're promoting hyperaxing. Leg extension surgery is very popular these days. You never know.
Is it?
Subtle subtle messaging. Well, speaking of that, I wouldn't want kids getting body dysmorphia from editing their photos on a on an iPhone inappropriately. What did you think of all the privacy, parental control It felt like that had a remarkable amount of airtime in a relatively short keynote. Why do you think they're doing that? What was the outcome? How was it received? What do you think comes from
Yeah. There was this rumor in the industry, a lot of the bigger apps in the App Store, I was hearing it from their executive last year, that Apple was going around and suggesting that it was gonna charge, like, basically create a new service line to verify it. So basically, like, have these developers somehow pay to be a part of this system. I I don't think that ever materialized or at least they haven't announced it, but, I mean, there you see the regulation on this topic and how it's heating up everywhere in every, you know, big country. And it was kind of funny, like, the day of the keynote, you know, every year there's protesters outside of Apple Park around the keynote.
One year it was about, like it was around the actors' strike and there were was like a services related thing.
And Cook's comp too,
think. Yeah. One year was around that. This
year This year
was around kid safety. So there was like these child safety advocates that were out there with their bullhorns, like, saying this stuff.
Mhmm.
And then Apple went ahead and did what I would consider, like, the fullest suite of kid safety features of any platform on that very day, which I think kinda shows that maybe it's just an issue they see really bubbling up and becoming really huge and trickling down from Meta and the social platforms and those huge trials that we've seen in recent months
Totally.
To the platform layer. Yeah. And, you know, all the all the apps will say, oh, we want Apple to verify, you know, the age because it's a lot easier than all of us doing it on our own and not having a shared consensus. So I think the industry is actually loving this because and it depends on how much if if Apple's gonna charge or not, but I don't think they are, at least in what they announced, but it it seems like a win win. I mean, the the device should be verifying age.
It's an obvious thing they can do. They already have the secure enclave. They can store it safely. Why would they not? So I don't know. I I actually really thought that was a good move on their part, and maybe they are just trying to get ahead of things too.
Kids, get ready to learn Linux if you wanna browse the web without your parents' approval.
That's always been the case.
I think this is good. I I I I think it's good to have the parental controls and then the kids
will Did they knock
their way around.
About ads at all besides that small shot around that they that they took? Because they're bringing ads to Apple Maps. They have ads.
Yeah. You gotta that they'll put ads in this thing eventually. Why not?
The idea the idea that they they really can't take the stance that, you know, ads are universally bad or they would have to self identify as a bad actor.
Oh. I mean, when you look at the new Siri app, right, which I looked at this morning and played with, it is a very, very bare bones, I would say, almost knock off of ChatGPT.
So a lot
of surface area for ads. A lot of surface area for things. I mean there's barely anything in there. Sure. I don't think they'll
do it anytime soon. But Like the idea like they're putting ads in maps Mhmm. So you will search something and it will pop up like the first result will be for somebody that paid to be there. Mhmm. And then to be like, oh, well, we would never put ads in, you know, in a in a, you know, a web search experience. It just it doesn't really it doesn't really make sense.
But Well, also working with Google, the largest advertising company on earth to Yeah. Help supply your AI strategy. Yeah. There's
I mean, one of my initial guesses that for like the longer term is that eventually the the dollar flow would flip. So right now Google pays Apple for the default search in Safari to be Google because they monetize Google searches with ads and I
They give them a percentage of revenue. Yes. Very very important distinction. Yes.
It's huge. And so Yes. My my prediction was that eventually Siri would be so integrated with Gemini that there would be ads in the Gemini stream and Gemini tokens would be monetized because the cost would drop and the monetization would increase and eventually Google would be paying Apple Yeah. For the right to be in those That's those streams that then are monetizable with links or affiliate links or ads or whatever they want to do. But I think all of the all of the big tech companies are being, you know, walk, crawl, run on this.
But so maybe it's
I thought that too, John, but I don't think that's the strategy at all. I think Apple sees I think what the smartest thing I heard, and I think it was Dave Moran. He told me I could quote him. Shout out Dave Moran. I saw him after the keynote.
Was that yeah. Shout out Dave. Was that Siri is the harness. So Apple's OS and Siri are the harness, and they built this flexible new infrastructure underneath that could be a future model. They were hinting, but not saying explicitly in all my briefings that there will be future models that you can choose from or plug into this.
And Google right now is their best partner for a myriad of reasons. We've talked about some of them. But they want to do all the post training. They want to do the reinforcement learning. They want to make it appily.
Mhmm.
And they're they have their foundational model strategy, and they're not at the frontier, but I think they want to be eventually, and they're getting that flywheel going. And I think this is potentially just a short term thing to them owning their destiny on the AI side more. Yeah. I think they feel like they finally have the pieces in place to get there. It's still gonna take probably a couple years as we see with Meta.
Like, rebooting a lab is no small feat. You have to get the flywheel going. I think they're on that path now, and they feel good about it. But I I don't I thought what you what you what you said was correct. Right? That it was gonna be just Gemini tokens that they monetize like search. And I I don't think it's that going that direction at all, actually. Interesting.
Would you expect Apple to make an AI related acquisition at north of a billion dollars in the next You
were gonna have thinking machines a year ago?
You know, I thought they would have already done that by now. They looked at Perplexity. Yeah. They looked at Thinking Machines.
If they got this far, what what what do
they need So they have this web knowledge graph now that I think was what the Perplexity acquisition would have unlocked for them. So they already went and did that. So I don't know what value Perplexity brings them now. Mhmm. I don't know what thinking machine strategy for that frankly even is for it to make sense for Apple, much less like what thinking machine strategy is.
So
Yeah. I guess. I just don't get it. So I I think I think they could make an acquisition, but it would be talent based. I don't think there's anything that's gonna be fully resetting the strategy or, like foundational like an Oculus or something like that.
I mean, think that moment's kind of past. It feels like it feels like all these companies are huge and mature and you're not going to buy Anthropic, you know, even if you're Apple, you can't afford it, and they wouldn't sell. So you have to go out on your own. Yeah.
Yeah. Makes sense.
Yeah. And if you look at the history, it's like Beats was like I think their biggest Yeah. Acquisition ever but it was like pretty conservative from a revenue
And what did that do? It got them some like Doctor. Dre ads?
Well, don't remember. It's just like they just their style is like, let's buy, you know, let's do like, like effectively, acqui hires, get really great people on board. Yeah. But the issue is that all the all the great teams get marked up so quickly billions now that they get kind of they're they're no longer that great a candidates for acqui hires because the investors on board are gonna say like, yeah, gave you guys, you know, $200,000,000 to take a big swing. Just take a big swing.
So how open do you think to close it out, how open do you think the Siri ecosystem will be over the Because next I'm optimistic that the base Siri model will be good on launch. But even if I put aside the ChatGPT relationship, I imagine that Gemini is going to launch three new models that are better in Q1, Q2, Q3. You know, they're going to be launching much more rapidly. And if I just want to switch over the default model to something that's more frontier, I saw in the Siri app I could select from the drop down. It was unclear if that was a default or something that I have to do per query.
And then there was a big question in my mind about will I be able to effectively remap the side button to just say, hey, Siri AI fine tuned on Gemini 3.1 or 3.5 or whatever. That's great but four o just came out from Google and I want to use that when I hit the button. Do you think that'll be an option?
I think they want to get there to some degree, but the question is how much this harness needs to be custom fitted for a specific model and how plug and play these is these things are. I mean, we just saw with Fable today. Right? Like, this is a this is kind of a new paradigm in a model. And would that work in a harness like Siri as it exists today? Yeah. You know, maybe the future of these models is actually being built in, you know, sync with the harness that they're meant to exist in.
Yeah. Yeah. So I
don't know if models will exist like search engines in the sense of, like, plug and play like that. The the products are just so integrated,
and Yeah.
Models are changing the way we think about operating systems Yeah. With agents. Right? Yep. So could you I to some degree, I think they will do something like a half measure there.
Mhmm.
But I don't think it's gonna be quite as full featured as you think. But you did kinda hit the nail on the head, which we can end on this. Like, the new Siri, it's up to the developer to opt in to this new Siri in the sense of it can see everything on the screen if it's, like, basic text and photos, but it can't understand the UI unless the developer opts in, which means you're basically letting Siri take all your data. If you're Canva, it's like you're giving it up to Siri. And it lives on device, and they say it's private, and Apple won't train on it, but you're still kind of fundamentally doing that.
Right? And so that's gonna be the big question is, will the metas of the world, will the OpenAI's, the Anthropix open their apps up to Siri of their own accord because the users demand it, or they think it's a good business strategy, but then you're giving that that data, that valuable UI to Siri. So I don't know. That's gonna be the next thing to watch, I think, in the coming months.
Very fun. Well, good time to be a subscriber of sources. So go subscribe already. It's always a great time. But it's the best time ever. Every day is
Loves catching up with you, Alex. Always great.
Glad to see you. Thank you, guys.
Enjoy the West. Safe travels. We'll talk to you soon. Have a great day.
Talk soon.
Goodbye. Well, whether you're bullish on Apple or bearish of Apple, go express it on public.com investing for those who take it seriously. They got stocks, options, bonds, crypto, treasuries and more with great customer service. And our next guest is already in the waiting room. We have Rob Schroder from Vinyl Equity.
¶ Rob Schroder Jr. is the founder and managing partner of Vinyl Equity, a growth investment firm focused on partnering with technology companies and founders. He is known for his long-term approach to investing, working closely with entrepreneurs to help scale businesses while emphasizing sustainable growth and operational excellence.
He's the co founder and CEO. Rob, how are you doing?
Welcome to the show. Hey,
guys. Thanks for having me. I appreciate it.
Thanks for
hopping on.
Appreciate that. First time on show. Why don't you kick us off with an introduction on yourself and the company?
Yeah. So my name is Rob Scroder. I am the founder and CEO of Vinyl Equity. Vinyl Equity is a transfer agent for public companies or soon to be public companies. We've been around since 2022, we just raised or just announced our series a raise today.
How much? Get that going.
How much did you raise?
$20,000,000.
Okay. Explain transfer agents like I'm five years old.
Yeah. It's a good question. Most people have no idea. So you could think of transfer agent as doing for the public markets what Cargo has done for the private markets. And so when a company goes public, they have to have a what's called a master security file, and it is the basis of their equity ownership.
And so transfer agents for a long time have maintained these records. You can think all the way back to the beginning of Wall Street. You used to have somebody who would take a paper stock certificate or trade on Wall Street, they'd walk all the way down to the transfer agent to record record that transaction on their ledger.
It's interesting.
So because
I just bought a I put my whole life savings in a in SpaceX, and the guy said we didn't need to use a transfer agent. And then I saw him on Instagram. He's in Miami, and then I think he was in South America or something.
Yeah. The stock certificates look like monopoly Yeah. Paper Yeah. Dollars.
I'm I'm realizing now I might have needed a transfer agent. Yeah.
Should call this.
But but how have they how have they modernized to date? We're no longer we're no longer Is there any We're no longer, you know, walking paper stock certificates around the
trading Historically,
they haven't. Yeah. Long and short of it. So I I actually I started the business after running portfolio operations at AngelList.
Mhmm.
And we did, think, 200 plus IPOs in the couple of years that I was there out of the portfolio. And every time we worked for the transfer agent, it just felt like we were sending paper around all around the country, just trying to get our shares into a brokerage account. So tons of market exposure post lockup, and, you know, as as you look at the market today, it has changed drastically in the last six months. I mean, even just in the last six months. You've got tokenization.
You've got these massive IPOs that have cap tables that are substantially more complex than they've ever been before, and user expectations have shifted. And you guys have talked about you're buying SpaceX shares down in Miami from people on the street, and but they're you're also expecting to get those shares instantaneously. And, you know, we live in a world today where you can get packages delivered in less than a day, and yet from the transfer agent to your brokerage account, by and large, you can't get your shares delivered in twenty four hours. And so Vinyl was built to solve that problem effectively.
Quick question. The name. Why Vinyl?
Transfer agents keep records.
Oh, okay.
Yeah. We spent a lot.
Vinyl's booming.
Spent a
lot of time trying to figure that out. Yeah. That's right. Yeah. We're back, Yeah.
So so with yeah. This this SpaceX IPO is insane also just because of all the layered
There actually are unironically a lot of unwinding.
And part of why solving this is so important is like, you know, the way markets feel like they're at least in this whatever part of the cycle we're in right now, such violent movement like twenty four hour delay could meaningfully impact meaningfully impact your your returns. How how are you guys like, what does your go to market look like at this point? Like, where where do you guys kind of like take the take the baton? I don't know if that's that's the right way to think about it.
Yeah. We
we generally come on board with clients as they're getting ready to go public. So they're thinking about their IPO in the in the context of an IPO. And so if they're making a switch from a cap table administrator to a plans administrator, we think that's a really good time to align. But there are companies, depending on their readiness, that will bring on a transfer agent, you know, two months before an IPO. We help facilitate the transfer of that information seamlessly.
We do use APIs. We are an API native business, and so it is fairly seamless and straightforward for us to ingest those records. When we get our company stood up, we actually give them a staging environment so they can go and test all of the data and make sure it's correct. And that's an anomaly in the world that we live in. And so, you know, for a very long time, this has been a just in time industry that's operated on paper, that's operated very reactively.
And we want to pull all of these motions forward so that companies can go into the public markets with certainty. I think what you guys are referring to is the liquidity process and the transfer agents involved in the liquidity process. I talked to a family office the other day who told me that on average they see see shares show up post lockup nine days after the lockup is lifted. And those shares will often see 10% delta in when in the pricing when from when the lockup was lifted. And so our ambition is to make a more fluid capital markets from the point of issuance to delivery.
By being proactive and having more nimble systems, we're able to do that.
Little bit of a somewhat related question. Bill Gurley hit the timeline earlier last night, 8PM. He said, if someone is telling you you are subject to a lockup agreement and your firm signed nothing with the lead underwriter, they are either lying or misinformed. Lockups are a silly contract with the underwriter primarily to help engineer a secondary. Prove me wrong, I'll correct.
He turned off reply so you can't prove him wrong necessarily but he said also it's never been enforced. The underwriting bank would have to sue for breach of contract. He asked AI the best example of lockup breach, couldn't find one, try it yourself, find a counterpoint. Please share. I want can you explain what he's talking about? Do you have any idea what he's getting at? Is there any truth to this or do you want to push back and prove him wrong? So
lockups are are are agreed on with underwriters for the purposes of smoothing out market entry and smoothing out volatility for all intents and purposes. And so, you know, as he refers to it as sort of an abstract or created construct of the ACE, right? It is agreed on with the company as a way to manage the inflows and outflows of securities into the markets. The vast majority of companies, you know, don't see the kind of demand that we're going to see and probably the kind of volatility that we're going to see over the course of the next several months. And so, you know, you see some creative constructs that have been proposed in in, you know, the IPO that we're gonna have on we're gonna see on Friday, and then presumably some of some of the other IPOs come down the pipe.
So And then
and then also the the company is signing a contract with the underwriter, the bank. And the company probably does have pretty solid legal recourse over the employee stock option pool, maybe the founders or current executives. But what he's talking about is being an early stage venture capital investor who maybe didn't sign many contracts that relate anything to lockups so he doesn't necessarily need to sign on. Course, a good underwriter might go around and say, wait a minute, there's a VC who wants who's heading for the exit who owns 20%, like let's bake that in, get them to sign a contract. But he's saying if I didn't sign anything, I'm selling on day one, guess.
Something like that.
Yeah. By and large, you're going to find that liquidity is pretty tightly held or gated by the transfer agents and the broker. Sure.
Sure.
And so and when those lockups are agreed to, they they tend to get managed pretty Well,
thanks for helping break it down. I know it's
a Yeah.
A hairy but it helps contextualize these things. I really appreciate it. Jordan, anything Thank
you for modernizing investment capital flows.
Thank you for everything.
It's truly
important work. Thank you.
Yeah. Yeah. Appreciate it. It's an area that I think nobody's really thought about for the last the last, I don't know, forever. I'm glad you And and we're excited to be thinking about it here. So It's good.
Good get
their shares more effectively.
Yeah. Good problem for the Angelist Mafia. Sure those 200 IPOs that you went through were, you know, stressful. But Well,
thank you so much for coming on the show. We'll talk to you soon and congratulations to
the team.
Appreciate you guys having us.
Good bye. What else is going on in the timeline today? The system prompt already leaked for Siri. Is this real?
Hard to tell if it's real.
Siri.
But you know what is real?
What is real?
A Colorado man has been arrested alongside his passenger for allegedly driving more than a 130 miles an hour through Northern Colorado.
Mhmm.
He was doing a cannonball run run, John. And I wanted I I'm just gonna assume that this is someone in the audience. They're probably not watching right now because they are in prison. But but yeah, it is a Cannonball is not for the faint of heart.
It is crazy that people are still going for the Cannonball record post post COVID because all the records were smashed. So if you're not familiar with the Cannonball, it's a coast to coast race. You race from the Red Ball Garage in New York City to the Portofino Hotel in La Jolla I think in in in Southern California. And it takes something like originally like days and days and days. People did it on motorcycles.
People have done it all sorts of different things, electric cars, self driving cars. But the true record was you know sort of no limits. People go as fast as they can, very dangerous, very illegal. You have to wait for the statute of limitations to lift before you share your run or share the video or else you'll be held accountable for what you did. Very controversial in the car community too.
Some people love it. Some people don't think it's safe and for good reason. It's very dangerous. But a lot of people bring iPads and Waze and different maps and different radar detectors and all sorts of things. Some cannonball record holders actually had friends who piloted planes that flew in front of their car. They're going 200 miles an hour. Planes going two fifty and looking for cops ahead of them. So that was the level of detail. There's multiple stopping points. They plan out the gas.
They have a fuel tank in the back, a fuel cell that holds an extra 50 gallons of gas or something like that so you can stop less, a two stop, a three stop. These are the techniques. I'm I'm roughly correct here. But the during COVID, no one was driving. No one was on the no one was on the roads.
And and this was before people were like, well, I can't go to a crowded building, I can go camping, I will get on the road. But even the trucks were off the road and the trucks are the slowest part because you get stuck behind a truck. You might not be able to get around. And so all the Cannonball records were smashed. Ed Bohlian from VinWiki participated and did very well.
I think he held the record for a while. Maybe still does. But to go after it today in the modern era where technology is even better, The cops have better radar than ever. There's cameras and all sorts of things. Truly one of the boldest things you can do. So good luck to him on his legal fight. Maybe he'll be using a legal AI tool to get himself out of jail. I don't know.
Harvey, don't make mistakes.
Maybe. Maybe. Anything else?
Well, folks, we will be back tomorrow Tomorrow. For a massive show.
We gotta talk about the Trojan horse for the Odyssey, The popcorn bucket. The TBPN effect. We have a giant horse which might be a Trojan horse. We never opened that thing up. We don't know what's inside.
That is true.
Can you imagine? But the Odyssey has released a limited edition Trojan horse popcorn bucket to commemorate the Odyssey. You can get it. People were fans of the sandworm popcorn bucket. This doesn't feel like it came from the mind of Christopher Nolan.
This feels like some producer, some some money man came up with this. I I like it. I think it actually looks cool. I don't know how practical it is to eat your popcorn out of this Trojan horse, but it is very fun. And I like the popcorns hidden inside the horse. Be picking one one of these up. Production team, how is the process of obtaining tickets to the Odyssey? I've been seeing that it's very stressful. Hasn't been going well. We got some. Are you securing anything?
Got some.
You got some? Where are you going?
Where are we going?
You're going to Chinese Theater?
Chinese Theater IMAX.
That's a good one.
And you guys got tickets for like the whole team, right? Because like No. Just production teams. Yeah.
All brutal. Wow. Okay. I see. Oh. Little division here. Okay. We'll solve it. We'll solve it. No. Wait a minute. We gotta we gotta get everyone out to the Odyssey. You should get your friends out to the Odyssey. Call everyone. Buy a bunch tickets. They're refundable on Fandango if you do it that way. And then
The Kugen method.
Get get 20 tickets. Text everyone you know who's in town. Tell them be here at this time. You'll get some some churn. Not everyone will show up. You refund those tickets. Then you charge everyone after the fact. It's a good strategy for having fun with some friends. Touching grass, reminding yourself of what's real. It's important. Stay sane out there. Leave us five stars on that podcast Spotify. Sign up for newsletter, tbpn.com. Flashback. See you tomorrow. Goodbye.