E130: DeSantis's Twitter Spaces, debt ceiling, Nvidia rips, state of VC, startup failure & more

00:00:00.000 | Look at John Quincy Adams here.

00:00:01.680 | Yeah. Hey, Quincy, how you doing?

00:00:03.520 | That hair. Look at that hair.

00:00:06.880 | John Quincy Adams needed a wig to achieve this look.

00:00:09.280 | He did. He did.

00:00:10.240 | I did it all natural.

00:00:11.600 | I mean, it's a lot. It's a look.

00:00:14.000 | You're like some movie star from the 1970s who's still working. Do me a favor,

00:00:18.320 | pull up a picture of Graydon Carter for a second and then put that side by side with Sax.

00:00:22.000 | Let's see. Just zoom in on that. Sax, this is where you're headed, by the way.

00:00:26.880 | You're headed to crazy town.

00:00:29.200 | This is where you're headed. You can just poof it out on the sides and you get a little

00:00:32.880 | woof swoop on the top.

00:00:34.480 | Crazy town.

00:00:35.760 | This is where you're headed. Eccentric Sax. Pull up a picture of Steve Bannon's hair.

00:00:41.360 | He's a wise statesman.

00:00:42.560 | I think this is what happens when you get too close to power.

00:00:44.800 | You get more eccentric with your hair. So like too much power equals crazy hair. Now, look,

00:00:50.000 | this is my theory. Graydon Carter, too much power, vanity fair. He went hair crazy. Now you look at

00:00:54.480 | Bannon, you get me a Bannon photo here, you start to see they go longer, they go wafty.

00:01:00.960 | They just they get volume and they're just like, fuck it. I'm just I'm not going to cut it. I'm

00:01:06.080 | going to let it go wild. And of course, the old I mean, he's the penultimate. But you look at

00:01:10.720 | Trump's hair. This is where it gets truly crazy. This is where you're headed, Sax.

00:01:14.560 | You keep getting this close to power. This is where your hair is headed.

00:01:19.360 | >>Sam: I'm so glad this podcast never broke up because where would we get this amazing

00:01:23.600 | insight from J Cal if not for keeping this all together? This makes it all worth it.

00:01:28.000 | It's very true.

00:01:29.040 | >>Corey: It is true. You get like eccentric and you get crazy hair. This is men get too

00:01:33.280 | close to power. And the hair gets wild, unchecked power, unchecked hair.

00:01:37.760 | >>Sam: We had a good meeting last night.

00:01:39.200 | >>Corey: We had an all in summit meeting. I said, Freeberg, give me a call. Let's catch

00:01:42.480 | up on this stuff. He's like, I'm in the bath right now with my candles. And I'm like,

00:01:46.480 | yeah, okay, whatever. That's cool. He's like, no, no. And he presses the video button.

00:01:51.040 | And then I'm exposed. I kid you not to the most bubbles I've ever seen in a bubble bath.

00:01:57.520 | >>Sam: I like bubbles.

00:01:58.320 | >>Corey: And he is peeking his head out from over the bubbles. And he's like, look.

00:02:03.280 | >>Sam: Which head?

00:02:03.840 | >>Corey: Exactly. And then he flips the camera around and I got his toes pointing out. And I

00:02:10.320 | kid you not, there's six candles around the bathtub. I'm like, this is like the prince

00:02:15.200 | of panic attacks. He had to come down for his phone call with me. So now when he has a phone

00:02:19.680 | call with me, it's so intense and everything's getting so intense with the summit that he has to

00:02:23.520 | do self care.

00:02:24.480 | >>Sam: Yeah. I had to be emotionally ready.

00:02:26.640 | >>Corey: He's self caring.

00:02:27.920 | >>Kyle: Your wife wasn't anywhere to be found. This is you in the bathtub with the candles.

00:02:32.000 | >>Sam: I take a bath every night.

00:02:33.280 | >>Kyle: Who are you romancing? Yourself or what?

00:02:35.520 | >>Sam: Yeah.

00:02:35.840 | >>Corey: I think he was romancing the spreadsheet with the profit line of all in summit.

00:02:40.240 | >>Sam: I have about 18 minutes of self care every day.

00:02:42.400 | >>Corey: 18 seconds, man. All right. Let's get the show started in three, two.

00:02:46.560 | [intro music]

00:03:03.520 | Hey, everybody, welcome to episode 130, maybe of the all in podcast. We're still here. Cooking

00:03:11.520 | with oil with me, of course, the dictator himself, Chamath Palihapitiya, Prince of Panic,

00:03:17.280 | Attack Sultan of Science, the Queen of Kinwa, David Friedberg, and the power broker himself,

00:03:24.960 | the emperor, David Sachs, the emperor of his new republic. Anybody have any interest,

00:03:33.040 | anything going on interesting this week? Any interesting moments for people on the national

00:03:38.000 | stage? No? Okay, well, let's get right into the docket. First around the docket, Ron DeSantis,

00:03:44.400 | Governor Ron DeSantis announced his bid on the internet on something called Twitter Spaces. And

00:03:50.400 | it looks like almost 10 million viewers have seen it so far across all the different spaces. And

00:03:57.600 | Donald Trump wasn't too pleased. He said, Rob, my big red button is bigger, better, stronger,

00:04:04.000 | and it's working. Truth. Because when Elon fired up the Twitter Spaces, it went to 650,000 viewers

00:04:12.240 | in under five minutes, and then blew up everybody's phones. My phone was melting, I could have cooked

00:04:17.440 | an egg on the back of it. The Twitter app crashed so many times. But then Sachs, with his meager

00:04:22.560 | following of a half million people or something, then restarted the stream. And so 15 minutes of

00:04:29.760 | technical snafus were relieved. And then there was a announcement. And I'll let you take it from

00:04:36.880 | there, Sachs. You want me to take you behind the scenes? Take us behind the scenes. Take us behind

00:04:42.640 | the scenes. How did it come together, Sachs? Oh, yeah, even better. Yeah, the way it came together

00:04:47.440 | is I think the DeSantis team were interested in potentially, you know, doing something different

00:04:52.560 | for their announcement. He also did an appearance on Fox News afterwards. And I think he did a town

00:04:57.920 | hall. But I think they saw an opportunity to break new ground here in terms of presidential

00:05:02.400 | announcements by doing it on Twitter Spaces. And so the DeSantis campaign connected with Twitter.

00:05:09.200 | And Elon and I agreed to kind of co-host the space with him. And he did his announcement. Now,

00:05:16.080 | you're right, we had about 15 minutes of technical difficulties, because the interest

00:05:20.720 | was so intense. At the time, the room crashed, it had over 700,000 people in it. And there were

00:05:26.320 | it crashed because so many people were trying to get in it. I think there was well over a million

00:05:29.920 | people trying to get in it. So you normally don't have this kind of interest. I think this is by far

00:05:35.120 | the biggest Twitter space. The engineers there told me that the previous order of magnitude was

00:05:40.960 | more like 100,000, not a million. And then you combine that with the fact that Elon's account

00:05:45.920 | has over 100 million followers. And that basically led to a new level of scale. And you guys understand

00:05:51.040 | that when you get to a new level of scale, as a platform, there's always going to be some

00:05:55.920 | challenges. So in any event, the engineers were there trying to figure out how do we solve this.

00:06:01.280 | And we realized the simplest thing to do would just be to restart the room on my account instead

00:06:05.440 | of Elon's. And then Elon joins a co-host and we brought DeSantis in. And it all worked perfectly

00:06:10.960 | at that point. The audio was brisk. We had over 300,000 people in the room. There was also another

00:06:17.120 | room that had been set up by Mario Nawal, who's like a big Twitter spaces host. And he had hundreds

00:06:24.240 | of thousands of people in there. And then he had live commentary from people he invited. And so

00:06:29.280 | this ability to fork Twitter spaces into many different rooms, and each room gets to decide

00:06:34.720 | who they want to be their host and their speakers, allows you to do live commentary and

00:06:39.280 | in a way that you could never have done before. So it was really innovative, I think.

00:06:43.200 | Super innovative. And for people who don't know, Twitter spaces was really a rush job at Twitter.

00:06:48.640 | They did that in reaction to Clubhouse. It's still basically a beta product

00:06:53.600 | that predates Elon being there. And it doesn't have yet the infrastructure or scale of the

00:07:00.240 | codebase, I don't think, like YouTube and Twitch do, which, you know, have been working on this

00:07:03.920 | problem for, I don't know, 15 years. Maybe the live products? I have two observations.

00:07:09.120 | Yeah, go ahead.

00:07:09.600 | The first is I thought DeSantis did a really good job just rolling with the punches.

00:07:15.360 | Okay.

00:07:16.720 | Because I think whether he wins, you're not going to look back on this moment as the

00:07:22.880 | defining moment of the campaign, nor whether he loses, will you say that this was

00:07:27.120 | where it was it all the beginning of the end. Instead, what this was, it was a really

00:07:33.280 | seminal moment, I think, in further divorcing ourselves away from the mainstream media.

00:07:40.880 | And you know that it was that important because Biden tried to troll the whole thing,

00:07:48.320 | Nick, you can show this link. This link works. And I actually think this is a really terrible

00:07:54.640 | idea by the Biden team, because never responded basically acknowledges how important the moment

00:08:00.960 | was. And the fact that even the President of the United States was grinding the link

00:08:06.080 | and couldn't get in because there was so much interest is really important. And I think what

00:08:12.480 | it speaks to is the fact that we are now showing credibly that you don't need to listen to four

00:08:19.920 | channels to shape your consciousness. And you can just go straight to the source. And what

00:08:25.600 | SAC said is right, if you now have a moderated forum, that then gets put out to 50 or 60 different

00:08:34.800 | Twitter spaces all at the same time, framing and reframing, it gives people a chance to come to

00:08:41.120 | their own conclusion in a totally unique way. So I think it was really, really an important moment

00:08:49.200 | for citizen journalism, and podcasting and audio formats and all of the things that I think we've

00:08:57.520 | been a small part of. But I think that it's really must have tilted the mainstream media and it

00:09:04.720 | tilted the establishment. And you can see that in Biden's tweet. Yeah, going direct. Yeah. So that

00:09:09.600 | was the first thing. Second thing. I think DeSantis did a really decent job in rolling with

00:09:14.720 | the whole thing and being super cool and just being committed to the process. And I think that says a

00:09:20.000 | lot about him as well, which was again, it's a question mark. And I've said this before,

00:09:24.400 | the big money guys got close and then took a step back. So this could be a very good moment for them

00:09:31.280 | to reevaluate because I thought he did a very good job. So I agree. So you know, I was there,

00:09:35.600 | I was live, I was seeing what was happening behind the scenes. When DeSantis came on after we,

00:09:39.920 | you know, had 15 minutes of technical difficulties. There wasn't a hint of anger,

00:09:44.160 | there wasn't a trace of irritation, there wasn't any freaking out that we were potentially ruining

00:09:50.080 | his presidential announcement, the guy was completely calm. And more than that,

00:09:54.320 | he was in good spirits. I mean, if you listen to the recording, you know, he's happy.

00:10:00.560 | His tone was great.

00:10:01.600 | His tone was really good. I mean, and then of course, it was very substantive. He spoke

00:10:05.600 | in a very articulate way about all the issues. When Congressman Thomas Massie came on to make a

00:10:11.280 | comment or question, he was telling a kind of amusing anecdote about when they were in Congress

00:10:15.760 | together. And Massie was one of the only members of Congress who had a Tesla, but he comes from

00:10:22.960 | Kentucky. So I think his license plate said Kentucky coal on it. KY coal. So anyway, you know,

00:10:28.400 | the guy was in good spirits. And so I think it does say a lot about what he would be like as a

00:10:33.040 | president, cool under fire, doesn't get thrown off his game. You know, again, not an angry guy,

00:10:38.720 | you know, which I think will be a real contrast with let's say some of the other people in the

00:10:42.880 | race. You know, Trump was sort of angrily truthing during the whole thing, you know, so I think it

00:10:48.560 | was a pretty strong contrast.

00:10:50.080 | Truthing the act of posting to Truth Social.

00:10:52.400 | Exactly. So the contrast between the personalities could not have been stronger. Now,

00:10:57.520 | to the other point, Chamath, about the traditional media, you're right about what they were saying.

00:11:02.880 | If you look at that, the headlines this morning from traditional media outlets that really started

00:11:08.160 | within minutes of the technical difficulties, the New York Times called the announcement a fiasco,

00:11:15.040 | NBC News called it a meltdown, Politico called it horrendous. And you know, why? I mean, if you

00:11:21.920 | You know what I call that? Winning. I mean, if they are losing their cool, that's clearly they

00:11:29.440 | feel threatened by the fact that a major presidential candidate chose to go direct.

00:11:33.760 | Or even the Wall Street Journal. The Wall Street Journal headline is DeSantis looks to rebound

00:11:38.160 | after botched Twitter announcement. But again, what they failed to acknowledge is, and I'm not

00:11:42.080 | a DeSantis supporter per se, I'm open minded to him, but I haven't decided one way or the other.

00:11:46.080 | But this is a guy that managed to get millions of people in a nanosecond to be activated to hear

00:11:52.160 | what he had to say. That is different than basically giving talking points and having surrogates

00:11:57.600 | lather through Fox or CNBC or CNN to hundreds of 1000s of people. This is a really important

00:12:05.200 | moment. I think what happened, right? We got all the positive just to finish that point.

00:12:08.720 | So if this was a political rally, a traditional political rally that started 20 minutes late,

00:12:12.960 | would anybody have said that was a disaster that happens all the time?

00:12:16.800 | No, it was the crashing that made people be like, Oh, my phone crashed. You know,

00:12:20.880 | I was using the app, I got crashed out of the app, but I had my phone did not crash.

00:12:24.480 | So yeah, that's what I'm saying. The app crashed a couple of times because

00:12:26.800 | the app crashed, your phone did not crash. Yeah. But any event look, this was at the end of the

00:12:31.360 | day, this was a an event that started 20 minutes late. Once we started on my Twitter account in my

00:12:36.960 | Twitter space, it worked perfectly. There was no problem. And that's the recording that you can go

00:12:40.960 | on Twitter now and listen to. We had about 300,000 people contemporaneously in my Twitter space,

00:12:46.720 | I think Mario had a couple 100,000. But if you look at the numbers today, there's already 10

00:12:51.840 | million views for this thing. By the way, three to 10 million on the replay. And that's what you

00:12:58.640 | have to look at replay because the world has moved to asynchronous like this was three o'clock in the

00:13:03.280 | afternoon in Silicon Valley and six o'clock. When was it in the afternoon, in the afternoon,

00:13:10.480 | so you have a hysterical overreaction by the traditional media, simply don't like a that

00:13:16.400 | Elon is disremediating them by letting the politicians go direct and then be he's restored

00:13:21.040 | the platform being a free speech platform. So they jumped on this the first second they could

00:13:25.520 | try and portray as a disaster. But, you know, there was an article in political this morning,

00:13:29.920 | and they were asking voters in Iowa what they think about it. And they're like, what, you know,

00:13:34.640 | it's not, it's an elite thing. It's not, it's not even on the radar. freeberg, we heard all the

00:13:39.040 | positive here. Any constructive feedback on it or thoughts on it generally? No, I mean,

00:13:46.400 | I would love to see all the political candidates engage in long form discussion like this,

00:13:52.480 | so that an audience can really get a sense of who they are and what they think in a direct way and

00:13:58.480 | an uninterrupted way. And in a deeper way, sort of like the conversation we all had with RFK last

00:14:04.960 | week and sacked it with DeSantis yesterday. And I would love for the voters who engage in that

00:14:11.680 | content to better understand the candidates rather than key off of short talking points and short

00:14:17.760 | ads. I think one of the saddest commentaries on modern democracy is that you can spend $1 to buy

00:14:24.320 | a vote, that all of these campaigns functionally try and raise capital to go and do advertising

00:14:31.440 | and that the advertising creates these little 30 second soundbites that actually change people's

00:14:36.720 | opinions. And it's a really sad it will it they did otherwise they wouldn't spend the money.

00:14:41.920 | And I think it's a really sad state of affairs that we spend money to change people's opinions

00:14:48.160 | by shortening everything to a soundbite. Instead of doing what maybe would have happened a long

00:14:53.200 | time ago, you know, we often talk about the town square if you lived in a village with 60 people,

00:14:58.320 | and someone was going to run for the mayor of that village, you'd all go to the town square,

00:15:01.920 | you'd hear that person have a debate, have a discussion, you talk with them. And that dialogue

00:15:06.000 | would inform your decision about who you're going to vote for. But you know, with 300 million people

00:15:10.720 | in this country, and you know, short attention spans and jumping around from one thing to another,

00:15:16.240 | there aren't a lot of great forums for any of us to really engage with candidates, particularly on

00:15:20.720 | the national level, and make a better informed decision hearing from that person directly.

00:15:25.120 | Instead, everything is about driving narrative and chopping things up and getting the soundbite

00:15:29.680 | and driving the emotional reaction. And I think one of the greatest things that's happening right

00:15:34.000 | now, that, you know, could be a great benefit for this modern democracy is the sort of stuff

00:15:39.120 | that we've been doing on our podcast and RFK coming on board, like last week, and what Saks

00:15:44.000 | did with Twitter. And I really hope that more politicians do that and that more people engage

00:15:48.080 | and consume that sort of content to make their decision and ignore the idiotic soundbites and

00:15:52.720 | the stupid 30 second ads and the nonsense that, you know, third parties use to try and drive

00:15:57.760 | narrative. So yeah, look, I mean, I think that's generally the positive trend that,

00:16:02.960 | that I took away from it. Jake, what do you think?

00:16:04.800 | I have some notes for Saks. I'm always, you know, careful not to be too critical,

00:16:09.520 | you know, in the moment, because I don't people will weaponize them and say, Oh, Jason said this,

00:16:14.160 | because, you know, it's Elon and he's team Elon, or he's friends with Saks. But I think

00:16:18.960 | everything said so far, this tweak the media, a great start. The thing that I think was there

00:16:25.840 | were probably one or two misses here that I think you can build on Saks since you're very involved

00:16:30.080 | in the campaign with DeSantis. I think it wasn't the free for all that Elon had said it would have

00:16:38.400 | been right. So he pitched it as like, hey, this is going to be uncensored. And everybody's going

00:16:43.200 | to get to ask hard questions. And that didn't happen. And you know, I think that is in stark

00:16:48.960 | contrast to what Trump did, because I was doing the media analysis of this. And so I think the

00:16:53.600 | follow up needs to be where he actually takes questions, not from fans, not from people who

00:16:58.720 | are already voting for him, but really, you know, a little bit more of the cantankerous people,

00:17:03.120 | the people who maybe are voting for Trump, the people who are maybe in the biting camp. And

00:17:08.560 | that's what was the masterstroke Trump's CNN town hall, he went into the, you know, the lions,

00:17:15.360 | then or what most people perceive was going to be the lions then. And he took on all comers,

00:17:20.000 | he fought hard. And that one was, I think, a bigger win. I don't think DeSantis

00:17:25.280 | was not a presidential announcement. So just to be clear, yes,

00:17:28.400 | this was a launch event declaring that he's running. So in that context,

00:17:32.800 | yeah, so you want to compare it to what these things usually are, which is a guy standing at

00:17:36.960 | a podium. Yes, in front of his supporters. Compared to that, this was much more interesting,

00:17:42.320 | dynamic and engaging. I agree with you that at some point, he's going to step into the lions

00:17:46.080 | den do a town hall on a place like CNN. And I think he probably will. In fact, I think he did.

00:17:50.800 | Yeah, I think he did a town hall or here. I think he actually did a town hall in Florida

00:17:54.880 | later that night. So yeah, I agree with you. It just wasn't that kind of event. Now,

00:17:59.200 | to the point about involving more people, you know, one of the things I learned hosting this

00:18:04.240 | thing is there were literally 1000s of people raising their hands. Yes, you can't start

00:18:08.160 | scrolling through this in real time in the app. I wanted to call them more people. But it was just

00:18:14.800 | there was no way to do it. This is something at scale, they need to add to the interface, which is

00:18:19.120 | maybe pre populating a list, sorting it by the number of followers, whatever. And this is my

00:18:23.440 | second point about this. So I agree with you. As an announcement, this was light speed ahead

00:18:27.280 | as like a full court, you know, like sharp elbow thing. It didn't hit that note, but it can. And

00:18:32.240 | that's what I think the follow up, you know, having if to Santa's wants to come here and have

00:18:35.600 | like a two hour discussion, we kind of get into it a little more, that would be I think, really

00:18:39.360 | good for him. Because I think he's got the potential to win over moderates. And I don't

00:18:43.120 | think this one over moderates didn't win over anybody who was in, you know, the left or in the

00:18:49.280 | moderate left. And that was one of the things I noticed is my second point about it is what a

00:18:53.680 | great group of listeners, if you look at who showed up to listen, Bill Ackman, Michael Dell,

00:19:02.080 | because you know, it's

00:19:02.800 | already see you know, you want you sourced by your followers. So

00:19:05.440 | but I think it's sorted by the number of followers they have,

00:19:08.720 | it's sorted by your followers who then have the most followers. So you're gonna see it's a bit of

00:19:12.720 | a echo chamber that way. Okay, feature.

00:19:15.840 | Okay, sure. But they were still very prominent people in the room.

00:19:20.320 | Prominent people follow you.

00:19:21.600 | Okay, but they weren't coming to follow me. They were coming to listen to this. My point is still

00:19:26.080 | the same. Michael Dell, Bill Ackman were coming. So

00:19:28.240 | but that's why you saw them because they're your followers.

00:19:30.400 | I we all understand that. They still showed up for this in the middle of the day. I think that

00:19:34.800 | is really interesting. And that Yeah, yeah, that's, yeah, that's all my point is, it's really

00:19:39.200 | interesting that powerful people showed up for it. Full stop.

00:19:41.440 | Saks. I have a question for you. Sorry, Jason, whenever you're done.

00:19:43.760 | Oh, yeah. And then I just had a couple of other ones. Elon was a bit underutilized in this format.

00:19:48.880 | And that's, you know, a challenge when you have Elon in the room, because people want to ask

00:19:53.040 | Elon questions. So this is something I think he's gonna have to, you know, contend with.

00:19:57.120 | People wanted to hear Elon ask questions, then the people who are more asking the questions

00:20:02.960 | wanted to ask you one question. So you do get like a little bit of how to utilize Elon in

00:20:08.080 | this format. I heard a lot of back channel from important people, like I wanted to Elon ask a

00:20:12.320 | question, or maybe the two of them get into it. So for a follow up one, getting some people,

00:20:16.960 | you know, who maybe don't traditionally get to ask questions, because let's face it in

00:20:21.360 | traditional media, the only people get to ask questions are these anchors on news channels.

00:20:25.760 | I want to hear Michael Dow or Bill Ackman ask a question. That's the opportunity in Twitter spaces,

00:20:30.320 | maybe letting Elon ask a tough question, then a follow up or you know, like we did here with RFK,

00:20:34.480 | I would have been totally open to that. I just couldn't manage it. There was just so many people

00:20:38.160 | in the room. I didn't see Ackman actually. I mean, I totally believe he was there. But I didn't see

00:20:41.680 | the only criticism people had of you, Saks is you're a major donor and you stack the deck was

00:20:45.920 | the most cynical version of it with like, five people who were just super effusive. But this is

00:20:50.160 | his launch party. So I think in that context, I would have called on Bill Ackman if I known he

00:20:56.160 | wanted to speak, but I can't see whether he raised his hand or not. No, I didn't see him in the room.

00:20:59.840 | So what I was just do call on Bill Ackman. And he's like, guys, I don't want to talk. I don't

00:21:03.760 | want to put him in that spot. Can we get him on this pod so we can grill him about abortion and

00:21:07.280 | fiscal policy? Who Bill Ackman? I don't know. I look I don't speak for the campaign, but I can

00:21:12.560 | put in the request. Whoa, whoa, whoa, whoa, you put 150 dimes and get them on. Hold on. Can you

00:21:17.840 | can you tell us the actual tick tock of how this whole thing came to be the campaign within the

00:21:22.720 | last week or two had the idea of should we explore doing it on Twitter spaces, and I think they

00:21:28.080 | were open to doing it. And Saks didn't know about it. When I put it in our group chat,

00:21:33.360 | Saks was like he is. Yeah, you found out about it. I was being facetious. I was being joking.

00:21:38.160 | I thought you didn't go. No, sometimes Elon will just tweet something without telling anybody.

00:21:41.680 | I just go to I mean, I help. Look, the distances people reached out to Elon and Twitter. They also

00:21:47.680 | reached out to me about it. And we discussed it and they were excited breaking new ground

00:21:51.920 | to something different. And I think they deserve credit for that. Can I ask a follow up question,

00:21:55.840 | just on the dissent is thing himself because you've seen him up close. Do you know why

00:22:02.160 | Schwarzman Griffin Peter Fry stepped in took a half step back? And do you know what it's going

00:22:07.120 | to take for them to just lean in and just make this a fat to complete so that he's really well

00:22:11.280 | financed to beat Trump? I don't know what their issues are. But I did see I don't know this was

00:22:16.160 | the name Peter Fry or whatever. Yeah, yeah, I don't I don't know him. But I did see a press

00:22:19.920 | article and he was referencing book bannings. So that to me just showed that he was buying into

00:22:26.400 | some, you know, crazy left wing. I think that was the best part of the discussion. I asked

00:22:31.440 | us about that. So by the way, for people, one thing that was new news for a lot of people was

00:22:37.360 | the book banning. Can you explain the issue and the spin and the clarification on book banning

00:22:43.040 | in Florida? It's very simple. They haven't banned any books in Florida. But the question is what

00:22:48.400 | books are taught in the curriculum, and what's in the school library. And some of these books were

00:22:54.080 | positively pornographic. I mean, they had someone to Santa's had an event where somebody was actually

00:22:59.440 | reading what was in these books. And the mere reading of what was in the books actually got

00:23:05.360 | labeled on social media by the algorithms. So there was a lot of stuff that's just not appropriate

00:23:11.200 | for kids. No one is restricting your ability to buy or read whatever books you want in the state

00:23:15.920 | of Florida is ridiculous. There's a legitimate question about what's in the curriculum. By the

00:23:21.040 | way, I remember when we had debates on campus about this is back a long time ago, like late 80s,

00:23:27.520 | early 90s, when they were throwing dead white males out of the curriculum, you know, Plato,

00:23:31.280 | Aristotle, Shakespeare, people like that. The people on the right who were opposing that never

00:23:37.040 | made the argument that this was censorship. Everybody understands that when you're dealing

00:23:41.120 | with a curriculum, you have to make choices, you can't teach everything. So the question is,

00:23:46.240 | what are you going to limit it to? And I think that when people actually dug into some of these

00:23:50.880 | books, they realize that they're not appropriate. So in any event, his answer was along those lines

00:23:56.400 | that, you know, you should go listen to it for yourself. But I think that he did address

00:24:01.120 | that issue. I think he's kind of exposed it as a, you know, left wing media narrative.

00:24:07.440 | And I think he deconstructed it. And I think that was helpful, because I think there are a lot of

00:24:11.040 | centrists who all they've heard about DeSantis is that he's banning books or, you know, or the

00:24:17.360 | Disney issue, which we also asked him about. And we covered that, I think. So yeah, the Yeah,

00:24:23.520 | we talked about some of these controversies. The issue here, just to summarize, it is,

00:24:28.080 | the left is framing the banning, quote, unquote, but just the not inclusion of certain books,

00:24:36.160 | which are graphic that have sex in them, from certain age groups, in schools as part of a

00:24:41.760 | curriculum. So they're saying these books are banned in Florida, the more accurate way to say

00:24:46.240 | it is, these books are not being used in curriculum. You know, for these age groups,

00:24:52.000 | parents, if they want to buy them, can buy them, and then can read them. So this is where this

00:24:56.560 | conversation is kind of breaking down. And I think is a complete waste of time. All parents want

00:25:01.360 | control over at what age or what stuff their kids are exposed to. And so there is a thoughtful

00:25:07.040 | discussion to be had there. And maybe the discussion is, this is something parents should

00:25:10.960 | decide, right? Yeah, of course, but it's not a conversation. It's a hoax. It's a it's a fake

00:25:15.280 | media narrative. They're trying to pin on him. And DeSantis has been the subject and victim

00:25:20.560 | of these types of fake media narratives, which are deliberate, the media is not trying to have

00:25:24.160 | a conversation. They're trying to disqualify the guy. And they did this, this goes all the way back

00:25:28.640 | to COVID when he opposed lockdowns and kept schools open, and they called him DeSantis.

00:25:34.640 | So the media has had an in for this guy since the beginning, because he refuses to go along

00:25:39.920 | with their narratives on things. This is the same reason they hate Elon is Elon is defying their

00:25:45.120 | narrative control. So you put these guys together, okay, hold on, even before the technical

00:25:50.000 | difficulties, let's be clear, the media's heads were exploding, that DeSantis and Elon were gonna

00:25:55.600 | be in the room together. Look at the Vanity Fair article, the headline was DeSantis announcing with

00:26:00.720 | Elon because David Duke wasn't available. Okay, the Atlantic was saying that this whole Twitter

00:26:06.000 | space was a hate group. I mean, literally, so these people were losing their minds before

00:26:11.040 | we even got into the technical difficulties. And then they pounced on that that there was a

00:26:16.320 | 20 minute delay, they pounce on that as some sort of fiasco, which it wasn't

00:26:20.160 | will DeSantis cut spending and cut our taxes. We cut spending,

00:26:26.480 | we didn't get into that. So have you ever had a conversation with him about balancing the budget

00:26:30.800 | and federal debt? Do you know his position on cutting like long term capital gains and taxes?

00:26:35.600 | I don't know his position on that. I can't let me give you the elevator pitch. I mean,

00:26:39.920 | the nutshell for DeSantis is he calls it the Florida blueprint. He's saying,

00:26:43.680 | look at what we've done in Florida, look at what we've achieved at Florida. Let's take

00:26:47.040 | Florida nationwide. Florida has had a great economy for zero budget. Zero because I don't

00:26:54.080 | that's a state that's you if you have zero tax, you have my book.

00:26:57.600 | Dictator has spoken if people want to look up this issue. There's a book called gender queer.

00:27:05.280 | And there's a story about in the New York Times. And it's, you know, it's a graphic novel about

00:27:10.160 | coming of age for a non binary person, which is fine. Great, but it's it's very graphic. It's a

00:27:16.240 | graphic graphic novel. It has explicit scenes. And these kind of books, most parents would say

00:27:21.600 | I would like to wait on cutting my taxes to zero. Okay, there you go. It's called the DeSantis to

00:27:28.880 | write it. Come on, guys. Overall, great job. And yeah, get him on the pod here. And we'll have a

00:27:34.880 | great discussion with him. Yes. Great job. Please invite him to our pod. I think, you know, we each

00:27:42.000 | have our own issues. We'd love or else we're just gonna go with the other Republican candidates,

00:27:46.000 | Nikki, I'm proud of you. Or else I'm voting for Yes, I don't know. I mean,

00:27:50.480 | I will. Thanks, guys. Yeah. I think it'd be great to get Nikki Haley. That's a no,

00:27:54.640 | that's a no. Just say no. No, no. I'm gonna put in the ass to DeSantis for sure. All right. Well,

00:27:59.920 | that's great. Yeah, it would be great. People want to hear from more folks.

00:28:03.760 | So a lot of other news going on. I think a good place for us to go to next. Maybe do we want to

00:28:10.400 | do the debt ceiling, defense spending or Nvidia? Let's go together. In my opinion. Okay, great.

00:28:16.080 | We'll go with the Sultan of Science. US debt ceiling is at 31.4 trillion. Currently, Treasury

00:28:23.840 | Department recently warned the federal government could be unable to pay its bills as soon as June

00:28:28.640 | 1. Fitch put the US credit rating, which is the highest rank of triple A on negative watch. So

00:28:35.120 | negative watch means it's trending towards bad and that it's imminent that they might lower it due

00:28:41.600 | to this debt limit deadline. It seems like we're not making much progress every couple of days,

00:28:47.520 | we seem to swing one way or the other, the stock market has kind of shrugged it off. And the last

00:28:53.920 | time the US credit was downgraded was in 2011. But we avoided that. Chamath what's going on here?

00:28:59.840 | What do you think the eventual outcome and is there a chance that these knuckleheads who represent

00:29:06.560 | us are going to default and cause chaos? Or do you think this is all kabuki theater and we're

00:29:12.240 | going to wind up in the same place which is they raise it and make some modest concessions

00:29:16.240 | August 5 2011. The SMP downgraded the United States from triple A to double A plus,

00:29:24.800 | you know what happened? Absolutely fucking nothing. Okay. So I do think that this is

00:29:32.880 | another opportunity for the little red riding hoods to get their panties in a bunch.

00:29:38.000 | But these downgrades don't mean much of it to their

00:29:43.120 | freedom. I think that these third party credit rating agencies are not particularly that

00:29:55.840 | accurate and sophisticated. They don't know anything that you don't know.

00:30:00.480 | They're not getting access to Moody's gave SVB and a rating the week before it went into

00:30:06.320 | receivership. This is my exact point. None of these companies know what they're doing. These

00:30:12.080 | companies are in the business of putting a letter on a document and then selling access to that

00:30:18.000 | document. So if you're going to trust these guys to know what they're saying, either right or wrong,

00:30:24.800 | independent of what side you are outsourcing your decision making to the wrong body. So whether it's

00:30:30.480 | SMP, Fitch or Moody's, I would tell you to ignore it and come to your own conclusion. I think that

00:30:36.960 | this budget ceiling thing is happening now every couple of years. And it seems like the real thing

00:30:44.560 | we should be talking about is whether Biden's going to use the 14th amendment and just ran a

00:30:48.480 | budget through. And I think that's, so under under the 14th amendment, the President of the United

00:30:54.320 | States has in their discretion, the ability to make sure that the United States can pay their

00:30:59.200 | debts. And that wasn't necessarily thought of as a way to work around the debt ceiling impasse.

00:31:06.080 | But because Congress refuses to pass any structural laws that allow

00:31:09.360 | the budget to ebb and flow with tax receipts, we get caught in this situation, again,

00:31:16.400 | roughly every handful of years. So what Biden could do is he could say the 14th amendment

00:31:21.520 | gives me the right, I'm going to pass a budget via executive order.

00:31:25.680 | From a game theory perspective, what that does is it forces Republicans to sue Biden,

00:31:31.920 | take him to the Supreme Court and say this is unconstitutional.

00:31:35.120 | The problem with that is that that probably really does tank the economy in the way that

00:31:41.440 | it creates enough uncertainty where capital markets freeze up and liquidity just absolutely

00:31:46.560 | goes away. And again, liquidity has been shrinking for the last 18 months anyways,

00:31:50.400 | so it gets even worse. So I think the brinksmanship right now between McCarthy and Biden is basically

00:31:56.160 | that veiled threat. If Biden effectively isn't going to get something done, I think he's going

00:32:00.960 | to test the 14th amendment. Now, if the 14th amendment turns out to be a reasonable way

00:32:06.000 | in order to pass a budget, the good news is not just for Biden, but for any future president,

00:32:11.520 | including Republican presidents will not have to be held hostage by Congress. They will in the 11th

00:32:17.600 | hour be able to pass a budget that works. The implications of that though, is that now you will

00:32:21.920 | not get consensus. And whatever's happening in that moment, you'll see more of so if you have

00:32:28.320 | a spending president, they'll just continue to spend and if you have an austerity president,

00:32:33.040 | they'll continue to cut. And that'll have implications on either side.

00:32:36.160 | Sachs, you think this is over issue as a 14th amendment? Or do you think it's a valid use of it?

00:32:42.640 | No, it's not going to fly. I mean, it's true that the 14th amendment has some language about the

00:32:48.640 | full faith and credit of the US shall not be compromised. However, it's never been tested

00:32:53.200 | or tried. So no one exactly knows what it means. Progressives are now saying that the language

00:32:58.800 | means that Biden could just keep spending without the debt limit being raised, but

00:33:02.240 | find himself through cold water on this. He said that he didn't think he had that authority. And

00:33:08.160 | even Lawrence O'Donnell, the other night, who's a big progressive on the media, he was saying that

00:33:12.720 | the Dems were going to take this tack. They needed to do it months ago before they started negotiating

00:33:17.440 | on a debt limit increase. So it's too late now. In other words, if you're going to take that

00:33:21.680 | position, why would you have negotiated that you're you the president are effectively conceding,

00:33:26.560 | you don't have that authority when you start negotiating. So I think it's too late to invoke

00:33:30.320 | the 14th amendment. They're going to have to raise the debt ceiling. That being said, I think they're

00:33:34.560 | going to be able to. Reuters had a report this morning that they're only 70 72 billion apart now

00:33:40.240 | in their positions, which is a relatively small amount. So my guess is they're gonna they're gonna

00:33:45.040 | work this out. Now, what should the fate of the debt limit be moving forward? I mean, the thing

00:33:50.960 | that's so stupid about our budget process is we spend the money and then argue about whether we're

00:33:55.200 | going to pay the credit card bill. The way that the debt limit should work is you raise the debt

00:34:00.640 | before you spend it. Congress should have to vote first on whether they want a deficit or debt spend,

00:34:06.880 | then you decide how much you're going to spend. So this thing, this vote needs to be moved up

00:34:11.600 | before they spend it. And I think if you did that, it'd be a lot harder for the politicians to spend

00:34:16.160 | money. Because, you know, if you had an up or down vote very early on saying, should we even be in

00:34:22.000 | deficit? I think a lot of people would say, No, we're not. And we're not in a war. So why? Why

00:34:26.560 | would you deficit spend? If we bring any thoughts in the debt ceiling, if not, we'll go on to

00:34:29.840 | the government accountability vis a vis the defense spending.

00:34:34.240 | I mean, look, we're running a $2 trillion a year deficit. And it's forecast to continue

00:34:40.480 | to be at that level for several years. And it's going to take pretty

00:34:44.720 | radical changes in how we tax and spend to make up that gap. So you know, this is a problem that

00:34:55.360 | is going to continue and repeat. And it does beg the question, you know, would you want to

00:35:01.840 | buy bonds from an entity that's generating 4 trillion in revenue and spending 6 trillion and

00:35:09.120 | has a plan to do that for the foreseeable future? And it's only, you know, seeing its economy or

00:35:13.840 | its underlying revenue base grow by 2% a year. It seems like, you know, that would be a very

00:35:20.160 | hard startup to fund. And it would be a very difficult growth investment to make, particularly

00:35:25.600 | in an environment like this. So I'm just pointing out that this is a becoming a more kind of

00:35:31.360 | systemically risky situation for the US, that, you know, we spend the way we do. And we have

00:35:38.880 | to keep coming back to having these debates about it's appropriate or not. And now they've narrowed

00:35:42.720 | down the way that the Republicans seem to be kind of going about getting this done.

00:35:47.200 | This deal done is they're only focusing on the, you know, roughly 15% of the overall

00:35:51.360 | federal budget. And they're saying, we'll kind of make some tweaks in that in that little range

00:35:55.920 | there and save some save some pennies, save some nickels. But we've got a much more fundamental

00:36:01.280 | problem to deal with, which is, how do we stop running these deficits and running the debt up?

00:36:05.440 | But I mean, I'm gonna sound like I'm gonna sound like a friggin.

00:36:08.880 | No, I think you're right. At some point. Yeah,

00:36:12.800 | the inflation is here. And the crowding out of private investment and private borrowing is now

00:36:18.640 | occurring because the government borrowing is so big. I mean, our Treasury, our government debt

00:36:23.120 | of what, three, 2 trillion, that has to be financed somehow. And all that money is going

00:36:27.280 | to finance government instead of being put to other uses. So I think that the downsides already

00:36:32.240 | here, you can't run $2 trillion deficits every year, that's unsustainable. Now, I think that

00:36:37.200 | you guys reference what happened in 2011. That's worth discussing for a second, because I actually

00:36:43.360 | think that what was agreed to in 2011 was excellent. Obama and the Republicans in Congress

00:36:48.880 | agreed to a thing called the sequester, where they agreed that they would freeze both defense and

00:36:55.280 | non defense discretionary spending until they could get their act together and agree on what

00:36:59.920 | the budget should look like. And so the theory was, the Republicans agreed to the pain of freezing

00:37:05.520 | defense, Democrats agreed to the pain of freezing non entitlement social spending. And that's how

00:37:12.320 | the deal was cut. I actually think that made a lot of sense. And I think we should have kept

00:37:15.760 | operating under the sequester until we got to a balanced budget. But the reason that broke,

00:37:21.040 | quite frankly, is because the lobbying power of the military industrial complex is so great in both

00:37:26.640 | the Republican and Democratic parties, that they basically wanted the sequester over the defense

00:37:32.480 | budget. I think it's just that there's never been a degree of accountability for the spending that's

00:37:36.800 | being done because of this assumption that we'll always be able to pay our debt, and we'll always

00:37:40.640 | be able to take on more debt. And I think that you see the other conversation, the other topic

00:37:46.800 | that we were going to talk about was this lack of accountability and defense spending that,

00:37:53.040 | you know, we should play the Jon Stewart clip. You know, where I think it who is he interviewed

00:37:58.320 | the Under Secretary of Defense or something? What is her title?

00:38:01.040 | Deputy Secretary of Defense Kathleen Hicks was discussing a defense budget.

00:38:05.280 | When I see a State Department get a certain amount of money and a military budget be 10 times that,

00:38:11.840 | and I see a struggle within government to get people like more basic services. I mean,

00:38:16.720 | we got out of 20 years of war and the Pentagon got a $50 billion raise. Like, that's shocking

00:38:22.400 | to me. Now, I may not understand exactly the ins and outs and the incredible magic of an audit,

00:38:29.600 | but I'm a human being who lives on the earth and can't figure out how $850 billion to a department

00:38:37.760 | means that the rank and file still have to be on food stamps. Like, to me, that's fucking corruption.

00:38:44.160 | I'm sorry.

00:38:44.720 | And then there was a story that came out this week, according to Bloomberg,

00:38:49.680 | the government accountability office disclosed that the Pentagon is currently unable to account

00:38:53.680 | for hundreds of 1000s of spare parts for the F 35 jets, the Pentagon's never passed, never passed

00:38:59.040 | an audit, and it's accepted. And it's acceptable in the same way that it's acceptable to never

00:39:05.520 | balance the budget, to always spend and give everyone what they want. And to find ourselves

00:39:12.960 | in, you know, this kind of late stage problem where we've gotten away with it for so long that

00:39:17.760 | both of those factors, whether it's the downgrade on the rating, whether it's the fact that we end

00:39:24.560 | up in these battles over whether to raise the debt ceiling every couple of years, or whether

00:39:29.840 | we can't pass an audit, all of these factors are symptoms of the same underlying problem,

00:39:34.560 | which is that there is no accountability for you know, how we operate the, you know,

00:39:40.480 | the kind of fiscal condition of the federal government,

00:39:42.880 | you know, the other thing it leads to is all these optional wars. So let me give you an example. So

00:39:47.680 | all of these wars are always they're all free. Yeah, they're all off book. So take Ukraine,

00:39:52.400 | we've appropriated what 130 billion, that's not part of the defense budget, we have eight or a

00:39:56.880 | billion in the defense budget, but then we just stacked 100 billion or so for Ukraine on top of

00:40:00.960 | that, and it's off book. Now, if we said the reason we're funding Ukraine is because it improves

00:40:06.480 | the national defense of the United States, why wouldn't that just come out of the defense budget,

00:40:10.560 | if you force people to make actual choices, actual decisions, and they could say, okay,

00:40:15.440 | we could spend 100 billion on Ukraine, or we could spend 100 billion on stockpiling tanks or

00:40:21.680 | f 35s, or whatever for the United States. Now you actually force some prioritization decisions.

00:40:26.880 | But because the wars are always off book, they're just additive, you just tack them on. And we did

00:40:31.920 | that with in Afghanistan, we did that in Iraq, we spent something like $8 trillion. And that was

00:40:36.800 | just added to the national debt. Yeah, we can't afford these anymore. It's becoming clear to

00:40:41.600 | everybody that there has to be some accountability. And Chamath, I guess, is, seems like there's a

00:40:47.040 | couple of unpopular stances to take when you're running for office. One of them is social security,

00:40:52.400 | retirement age, as we saw in other countries like France, where people are arguing over 62,

00:40:57.040 | 64 years old, whatever it is. Yeah. And so these entitlements, job requirements, if you want to get

00:41:03.280 | unemployment, and then of course, defense spending, you seem un-American, if you don't want to take

00:41:07.200 | care of old people, you seem un-American. And, you know, weak, if you don't want to support

00:41:13.840 | the government, is there a path towards celebrating an administrator as CEO,

00:41:19.840 | an executive who tells honest truth to the American people, which is, hey, we've been on a

00:41:26.560 | binge, we've been going on vacation, nobody's looking at the bills. And we need to have a

00:41:31.360 | staycation. We need to cut costs, we need some austerity here. Is there a path for somebody,

00:41:36.960 | Ron DeSantis, Chris Christie, RFK, whoever it is, to win over the American public to win over

00:41:42.960 | moderates with an austerity and a balance the budget message? Or is it just too unpopular to

00:41:48.800 | even bring that up? I just think that you guys don't psychologically understand how to get what

00:41:55.280 | you want. I think the best way to get what you want, which I would want to, which is a healthy

00:42:02.000 | economy where there's accountability for spending, is to not look at expenses. And all of this talk

00:42:10.400 | is always about expenses, but to look at revenue, and limit revenue more drastically. And I think

00:42:17.440 | the best way to limit revenue dramatically at the federal and state level is to just minimize

00:42:23.040 | taxation as much as possible. And I think that is something that Democrats and Republicans have a

00:42:28.880 | hard time fighting. Nobody wants to raise their hand and say, I want new taxes. Nobody says that.

00:42:34.240 | Right. And I think that if you attach that to some sort of spending guidelines,

00:42:39.920 | like what David says with a sensible foreign policy, you just end up spending a lot less you

00:42:45.200 | want to fight a foreign war. Okay, great. Well, you know what, it's part of the existing budget,

00:42:49.280 | let's go figure out why we want to do it. We want to have more accountability and defense spending.

00:42:53.680 | Okay, well, look, the defense budget is a half of what it used to be, because we just have half the

00:42:58.400 | revenue. I think that if you start to go and talk about austerity and cutting Social Security and

00:43:03.200 | healthcare benefits, it's literally a non starter. People close their eyes, they plug their ears,

00:43:08.640 | and you get nowhere. Now, separately, I think the step even before you look at taxation,

00:43:14.880 | so minimizing government revenue is to figure out how to refinance. So if you're a homeowner,

00:43:20.960 | and you got a mortgage in the 80s, you were paying 12 1415 16%. If when rates kept going down,

00:43:28.640 | you were the people around you didn't have the common sense to refinance that that was negligence.

00:43:35.760 | Similarly, we're in a position today to refinance our debt wall and push out these maturities past

00:43:43.280 | 100 plus years, we are the only country that has a viable, stable economy that looks like it can

00:43:49.760 | still continue to thrive at scale. Take advantage of that, you lose nothing by giving us the

00:43:55.200 | optionality, generating some 100 year debt refinancing a bunch of this short term stuff.

00:44:00.240 | And then second, inflation helps us. And it helps us because it allows us to inflate the value of

00:44:07.440 | these dollars that allows us to pay off our short term maturity. So these are two practical, simple

00:44:13.680 | things that are uncontroversial, that should happen today. And then separately, I think you need to

00:44:19.440 | look at minimizing revenue. And then you can cut expenses. But if you flip them around, I'm just

00:44:25.680 | telling you, I stopped like I want any of this to happen. But I'm telling you nothing will change.

00:44:30.240 | And you guys will still be crying wolf in five years, it'll still be the same, it'll just be a

00:44:35.040 | different debt to GDP number that gives you anxiety. Speaking of anxiety, freeberg your

00:44:38.480 | response. I don't agree. I think we need to balance the budget. And I think that if we don't,

00:44:43.760 | we agree with financing, pushing out 100 year no, no, I don't agree. Reducing revenue solves

00:44:49.440 | the problem. I think that and by the way, one of the problems with a democracy to mop is that

00:44:54.960 | you speak about it as if everyone benefits from a tax cut. Generally, there's some disproportionate

00:45:03.440 | benefit to a tax cut. And that's why it's less likely to happen because the majority will benefit

00:45:09.040 | by keeping taxes high for a minority, whether that's some corporate minority, or whether it's

00:45:15.680 | some wealthy individual minority. And that's why I think the opposite is more likely to happen,

00:45:21.600 | which is we're more likely to see taxes go up in order to bridge the gap to continue to fund

00:45:26.000 | programs that everyone wants to everyone wants an and they don't want an or. And as a result,

00:45:30.320 | they'll kind of continue to seek revenue because there are other places to get revenue that don't

00:45:34.160 | affect me, meaning it doesn't affect the majority. And I don't mean me personally,

00:45:38.240 | I'm just speaking about a voter and a voter would say if there's a way to tax other people

00:45:42.800 | for me to get the things I want, they will vote yes for that. And that's ultimately what the

00:45:47.040 | system ends up finding. And I think that's what's more likely to end up happening. That's all.

00:45:51.280 | Sacks. Yeah, look, I mean, I agree with part of both of what you're saying, which is,

00:45:57.920 | I agree with free bird that we need to balance the budget. There's no excuse for running peacetime

00:46:01.360 | deficits this large, we're really going to regret this one day. On the other hand, I agree with

00:46:05.680 | tomorrow that if you just try to solve the problem by raising taxes, the politicians will just keep

00:46:10.800 | spending. I mean, you have to starve the beast, I think, in order to control it. At least that's

00:46:16.080 | been a view, I think, for a long time. Do you agree with tomorrow on that point?

00:46:19.520 | Here's the thing, you cannot solve this problem by raising up to 70% tax rates like we had in

00:46:25.920 | the 1970s. And I can prove it, pull up this chart. France is a good example of this, too.

00:46:30.240 | So what you see in this chart here is this is federal receipts, a percentage of GDP. What I

00:46:36.000 | see when I eyeball this is if you were to put a regression line on that, it'd be at around 17%,

00:46:39.920 | with a plus or minus of 2%. And the times when you get up to 19%, or a little bit close to 20%

00:46:47.360 | are when we have great economic conditions, or money printing. So the Clinton era from

00:46:52.960 | was a 92 to 2000 was an economic boom. And we got up to almost 20%. But we've never ever been

00:46:59.040 | able to get more than 20% of GDP and federal tax receipts, even during the 1970s, when the top

00:47:06.160 | marginal rate was 70%. What happens? Why is that the people guys are doing economic activity,

00:47:14.000 | it curtails investment and economic activity. This is documented for hundreds of years,

00:47:19.360 | taxation doesn't solve this problem. I don't disagree. I just can only get so much blood from

00:47:24.960 | a stone. And the reality is, is that when you try to tax rich people in a confiscatory way,

00:47:30.320 | they spend a lot more on lawyers and accountants to figure out how to structure their income in a

00:47:34.960 | way that they leave, or they tap out, you know, like, if you're paying 50 60% taxes, like,

00:47:41.040 | what's the incentive to go to work? And if you're sitting on a big nut, you can just be like,

00:47:45.440 | No, you know, and I'll just I'll just enjoy my life a little bit more, because each incremental

00:47:48.800 | dollar 50 60% going to taxes, and then I have to pay my team and you just sort of I asked a

00:47:55.600 | question on Twitter, you know, because we all talked in our group chat about the concept of

00:48:00.000 | passing a balanced budget amendment, which would be an amendment to the US Constitution that says,

00:48:04.080 | you know, Congress has an obligation and the executive branch has an obligation

00:48:09.280 | to generate a budget surplus, you know, every, every year. And you could have a

00:48:16.000 | balanced budget amendment that provides certain exemptions to this, like in a year of war,

00:48:21.600 | for example, where Congress declares an emergency or declares a war. And in those cases,

00:48:28.000 | theoretically, like if there's some sort of emergency that we have to address and overfund,

00:48:32.400 | you can kind of resolve to this. But man, I so might.

00:48:36.480 | But you know, we've been we've been at war for something like two out of every three years since

00:48:41.440 | the Cold War ended. How many of those war sacks were voted on by Congress is the other issue?

00:48:46.240 | You know, what happened is we did the authorization for the use of force, I think goes all the way

00:48:51.680 | back to was it like 2001? Whereas basically, we declare a war on terrorism in response to 911.

00:48:58.480 | And they use that authorization to go into Afghanistan, which I think was understandable,

00:49:03.120 | then they use that same one to go into Iraq, then they use it to go into Syria.

00:49:06.960 | And only recently, only a few months ago, do they actually repeal that use of force as a way to keep

00:49:13.520 | authorizing new wars. So they really should go back to Congress for every new war. But the problem is,

00:49:19.280 | you know, Freeberg, I agree with you that we need to have a balanced budget amendment, but

00:49:22.720 | it's going to contain a caveat or exception for war. And we're just at war all the time now.

00:49:28.320 | Sure. But I think that there's ways to create some mechanism that forces

00:49:31.920 | that issue to actually come front and center as opposed to being what you're arguing, which is,

00:49:35.360 | hey, it's always on the back burner, therefore, it's always bubbling over. And maybe you draft

00:49:39.360 | it that way. But what was surprising to me was just the incredible negative sentiment I got from

00:49:43.360 | so many people who are so deeply have this deeply held belief that the only way to support growth

00:49:48.800 | in our economy is through federal spending. And that that has become the driver that has become

00:49:53.520 | the handicap of our country. It has become the handicap of our economy. It has become the

00:49:58.400 | handicap of our people. And as a result, a handicap, because it means that we now have this,

00:50:02.720 | instead of having an incentive to drive productivity through private commercial

00:50:07.760 | and economic activity through innovation, through productivity gains through business building,

00:50:12.000 | it's now dependent on what we have now identified as a highly unaccountable system of spending.

00:50:17.760 | And that unaccountable system of spending ends up putting a lot of dollars into the pockets of

00:50:21.600 | cronies and the pockets of folks that aren't actually driving job growth or aren't driving

00:50:26.400 | productivity. There are certainly programs that work. But overall, there's no level or degree

00:50:30.960 | of accountability that asks the question, did that program work? Did we spend $1 and get more than $1

00:50:37.040 | back for what we spent? There's no assessment of that, whether it's a war, or whether it's

00:50:41.360 | defense spending. There's always some kind of intellectual argument that says true.

00:50:45.440 | I don't think that's true. I think the OMB releases report after report saying that all

00:50:49.120 | of this stuff sucks and doesn't do anything. Just nobody actually cares.

00:50:53.760 | You're right. I don't care. I think what you're saying is inaccurate. This is my point. I think

00:50:57.360 | it's important to get the facts right. What you are saying is not true. They do do an accounting

00:51:01.440 | that accounting sucks. It shows that there's tons of waste. Nothing changes. So now what do you want

00:51:05.920 | to do, David? Is the real question. What do you want to do knowing that we shouldn't spend on

00:51:10.640 | things that don't have a positive return? This is my point. That's why we're now in this very

00:51:14.240 | difficult situation. That's not happening. Now, what would you like to do? Well, the reason it

00:51:18.640 | doesn't happen is because the way that politics decides things has nothing to do with the merits

00:51:23.680 | of it. It has to do with special interest. I'm not debating that. I agree. I'm just saying,

00:51:27.040 | I got it. But this is what I do now. Just reality for a second. This is why I think our education

00:51:32.080 | system is like fundamentally betrayed the country because we just keep teaching people that somehow

00:51:35.600 | the government's going to solve all these problems, when really, it's just a product of special

00:51:39.280 | interest lobbying for things. And that's why we perpetuate these programs that don't work.

00:51:43.280 | I think the best way to think about government spending is that in every dollar, there's

00:51:46.720 | probably 15 or 20 cents that actually does some good. There's probably 15 to 20 cents that's like

00:51:53.440 | on the margins break even. And then the rest of it, which is half of it is wasted. That's probably

00:51:59.520 | roughly accurate, right? You get things like TARP, which turned out to be pretty decent program.

00:52:04.880 | There were things like the DOE loans that you know, got things like Tesla into the marketplace,

00:52:09.680 | right? There's things like the IRA today that'll de-lever ourselves and create a peace dividend

00:52:15.760 | because we won't need to fight over resources and oil from other countries. But the problem is that

00:52:20.720 | that represents a minority of the dollars. Okay, now that we know that that's true, and we've known

00:52:25.840 | that that's true for decades, I guess again, I'm just asking a practical question. What do you guys

00:52:29.920 | want to do now play the ball where it lies? What do we do today? There's a couple things you could

00:52:34.240 | do. First of all, one of the points I'd make is, I think you're probably right in your assessment

00:52:38.560 | that 50 cents, that's what you're calling wasted that money does end up somewhere, it ends up in

00:52:43.280 | someone's pockets, probably the pockets of the shareholders of some contractor, or the donors

00:52:48.640 | of individuals or employees. Well, there's also there's also individuals that benefit,

00:52:53.760 | but functionally, what's going on is it's a system of wealth transfer. And that's not necessarily bad.

00:52:58.880 | The question is, is the transfer of wealth happening to the right groups that we intend

00:53:03.920 | to support with these social programs? Or is it not? And I think Saksa's point, which I think we

00:53:09.040 | could all probably align on is it's not. And I think that's probably a set of standards for

00:53:13.040 | accountability that we should probably try and create. But where does that where does that money

00:53:18.000 | end up? It ends up buying homes, feeding people, they're going to restaurants, you're buying cars,

00:53:22.400 | not like there's like, a fleet of mega yachts in America. Well, I guess what I'm asking is where

00:53:27.600 | even that leakage of 50% doesn't that just end up in the normal economy? Yeah, it ends up supporting

00:53:32.720 | individuals and they buy a trickle down. Why is that so bad? Here's what I'll say. But that's

00:53:37.600 | what I'm saying. It is a wealth transfer. It is a system of wealth where it ends up in people's

00:53:40.800 | pockets. And that that system ultimately benefits a lot of people in need and a lot of people that

00:53:45.600 | we as a society intend to support here in the US. I don't think it just goes to poor people.

00:53:50.480 | Yes. There's so much corporate welfare. I mean, come on. It's not all just going to needy people.

00:53:59.440 | On some level, we can accept the inefficiency of government. I like your idea of constraining

00:54:07.520 | how much of a canvas they have to paint with and how much revenue they bring in. And I think what

00:54:14.320 | we have to accept is that the reason this country gets bailed out is because we have tremendous

00:54:19.440 | entrepreneurs, an amazing capital allocation system, a very fluid market for building corporate

00:54:26.320 | corporations and capitalism is so vibrant here, that no matter what happens, we always seem to

00:54:32.240 | make the next Google, Uber, Nvidia, whatever it is, Airbnb. And I can tell you, you know,

00:54:38.320 | spending a lot of time traveling, meeting with people in Japan, in UAE, etc. They're all looking

00:54:44.640 | at the massive entrepreneurial drive that we have in the United States to build global companies

00:54:49.760 | and how we do it over and over and over again. And the only countries that seem to be able to do this

00:54:55.040 | at scale, you know, maybe Sweden and some of the Nordics, obviously China, but other countries have

00:55:01.760 | not figured out how to build global corporations. And that is what bails us out every time is

00:55:06.560 | entrepreneur allocators,

00:55:08.160 | take out the deficits getting so big that we can't bail out that way. Think about it. We have 2

00:55:12.400 | trillion in deficit every year. That is two Googles. Yeah, it's an apple. We're spending an

00:55:18.800 | apple every year.

00:55:19.520 | We have to we have to address it. But the point is, that's how we have bailed ourselves out.

00:55:24.720 | Historically is massive capital allocation and entrepreneurship.

00:55:27.920 | I want to remind you guys what happened at the end of the 70s.

00:55:31.440 | We had all these inflationary problems. We had all of these taxation problems where people thought

00:55:36.000 | all of a sudden 70% tax rates, we're going to solve the problem, what you guys talked about.

00:55:40.240 | And instead, the exact opposite thing happened, which was the guy that got elected.

00:55:43.920 | Ronald Reagan, I just want to remind you what the electoral college was between him and Jimmy

00:55:48.320 | Carter, for 89 to 49, like a bigger, just shellacking, I don't think we've seen in modern

00:55:56.320 | US politics to the guy that basically said enough with this, we're going to tone it all down. And

00:56:02.160 | we're going to cut revenues. So I do think that people have an appetite for them. And I think

00:56:06.960 | the debt to GDP in 1980 was only 30%. So we just have a lot less dry powder work to do. We got a

00:56:13.280 | lot of work to do. But let me say this. Look, Chamath, I actually agree with what you're saying

00:56:17.600 | in this sense. Okay, if you look at my simple chart of federal tax receipts as percent of GDP,

00:56:22.960 | okay, the highest it's ever been in the history of the United States is 19.75%. In 2000, we had

00:56:30.160 | the dot com bubble. Okay, that's the highest ever been. And we had periods of high tax rates and low

00:56:34.960 | tax rates, it never went above 20%. So the simple math here is, you do a forecast of what do you

00:56:41.920 | think GDP is gonna be over the next year, you get independent economists to do it. And you say,

00:56:45.440 | the federal government can't spend more than 20% of GDP, because we've never extracted that we've

00:56:50.880 | never figured out a way to extract it's perfect. Your logic is perfect out of the economy. The

00:56:56.080 | logic is perfect there. Your aggression is so it's very important, because what your aggression says

00:57:00.240 | is, we're actually spending a lot of energy fighting over two to 300 basis points at any

00:57:04.480 | given time. Right? Yeah. And what we should be focusing on is more important. Why are we doing

00:57:09.520 | that? Why are we spending so much time getting our panties in a bunch over two to 300 basis points,

00:57:13.680 | and we need to stop wars, increase our education system, stop the wars, by the way, and inspire

00:57:19.440 | people to start companies and make it easy to start companies, the BL, the IRA, and the chips

00:57:24.160 | act, all three, the biggest components in all three bills, this is Biden's signature legislation,

00:57:28.800 | is creating energy independence for America, which will have an enormous peace dividend,

00:57:34.480 | you will not fight these stupid, endless wars. Every single one of them goes back to oil,

00:57:40.080 | right? Like, with the exception of it's always about resources. Yeah, what has never been about

00:57:45.200 | resources in modern history? Well, and now it's going to be chips is the modern resource

00:57:48.800 | Nvidia shares jumped as much as 30% after reporting huge revenue guidance due to AI demand

00:57:53.840 | q1 revenue 7.2 bill up 19% quarter over quarter, not year over year quarter over quarter

00:58:02.160 | revenue beat animal assessments by more than 600 million for people don't know Nvidia is

00:58:08.320 | working on GPUs as opposed to CPUs, the graphic processing units that are being leveraged in AI.

00:58:17.200 | And there is a massive cycle going on. There's a line out the door to buy these when you see

00:58:21.920 | Twitter going into AI, Facebook, Google, and obviously, Microsoft,

00:58:26.480 | all the cloud infrastructure is moving from CPU to GPU. Yes, freeberg.

00:58:31.200 | Well, I mean, I was talking with the CEO and CFO of a major data center, reach, and they

00:58:38.560 | shared with me that they're seeing more demand in the last couple of months than they've seen in

00:58:45.280 | the prior 10 years, almost all of that data center build out demand. So they'll build data centers for

00:58:51.760 | software companies for internet companies is coming from, you know, GPU racks, and these

00:58:58.240 | GPU racks are much more energy intensive, much more costly, but it's a pretty kind of

00:59:03.360 | significant shift underway that businesses that historically didn't even operate their own

00:59:07.200 | data centers are now building out their own data centers have their own training systems to have

00:59:12.080 | their own infrastructure to be able to run AI applications and tools. So it's a pretty

00:59:20.320 | significant shift underway. All of the growth that Nvidia is projecting and

00:59:24.400 | highlighted in this earnings report yesterday, is coming from their their data center line of

00:59:30.560 | products. And it's a pretty significant I mean, I don't know, people have said they've never seen

00:59:34.640 | a beat like this or never seen an up a guidance update like this of the scale, where I think the

00:59:40.480 | street was looking for maybe a $7 billion guide and on revenue for this. And they basically came

00:59:45.680 | out and said they're going to guide to 11 billion next quarter, which is just an insane bump for a

00:59:50.560 | 90 day outlook. I was told from one of their major customers that they had to beg, like,

00:59:55.520 | he's in bag for 1000s of GPUs. And like the lobbying effort, he said, there's a line around

01:00:02.400 | the corner to buy these and you need only use chat GPT or any stable diffusion, etc. And you

01:00:08.640 | see how long it takes to do by generative AI to use these products. It's like we're back to dial

01:00:15.920 | up modem sacks. We're literally, we're waiting for a computer to give us an answer. When's the

01:00:21.440 | last time that happened that we had to sit there and wait for it to do its job. And I think this

01:00:26.240 | is the great renewal for America, another amazing American company. It's only three decades old,

01:00:31.600 | its best years, its best decades are in front of it. Obviously, this is going to be a massive boon

01:00:36.960 | for Yeah, not only in video, but for America, or as I say, America.

01:00:41.600 | Yeah, and videos basically joined the trillion dollar club. Now, in terms of market cap companies,

01:00:45.600 | it's really amazing. I mean, I'm kind of kicking myself because this was the easiest buy ever.

01:00:49.360 | chat GPT launched on November 30. We all saw that that immediately ushered in a whole new era in

01:00:54.880 | Silicon Valley. There's a ton of VC funding that's poured into AI startups, they all need to train

01:01:01.040 | models. And those models need to use GPU. So we all saw this coming. And I'm kind of annoyed with

01:01:07.920 | myself. I didn't let me ask you, let me ask you a question. So you say that you kick yourself,

01:01:12.240 | obviously, the general statement that you know, AI is coming and Nvidia is going to be a beneficiary

01:01:16.960 | or Nvidia's products are going to see a boon makes sense. But when you look at the valuation of the

01:01:21.360 | business, they are currently trading at 70 times the next 12 months EBITDA. So how do you think

01:01:29.760 | about valuation even at a trillion dollar market cap at a trillion dollar market, they're trading

01:01:33.920 | at 70 times next 12 months EBITDA. You know, this seems like they're doubling revenue every six

01:01:39.680 | months, though, dude, they're doubling revenue. Here, how high does it go? Because at a trillion

01:01:45.040 | dollars, what's the right EBITDA level for a business to be worth a trillion dollars? Is it

01:01:49.360 | 100? Is it 100? But I mean, what's the number? And then the question is, if it's 100 billion,

01:01:54.640 | how many years does it take them to grow into that? And you know, are you really paying

01:01:58.080 | the right price? Are you paying a premium to get, you know,

01:02:01.120 | and will be determined if they have competition. So is there competition for this company?

01:02:07.200 | Chamath, you'd think there's a competitor that will emerge that, you know, I mean,

01:02:11.120 | it's important to understand what a GPU is, maybe so sure, Intel had the run of the place for the

01:02:15.840 | first 40 years of compute. Because it turned out that most of the things that we use it for Excel,

01:02:22.240 | Microsoft Word, a browser, operated well on a CPU, which essentially think about it as like a

01:02:30.400 | factory that takes in the first order and then puts it up first and first up. And the great

01:02:34.640 | thing about GPUs is that it can take multiple streams of work at the same time and work on

01:02:38.720 | them at the same time, right? So it's very parallel and has this level of parallelism

01:02:42.640 | that makes it very well suited for AI applications. I think the thing to keep in mind is that it is

01:02:52.160 | a byproduct of a GPU that tries to also do other things. And so as a result of that, you're now

01:02:59.120 | seeing a lot of companies building their own silicon. And most importantly, all the big tech

01:03:05.680 | companies now have some pretty well evolved efforts underway. So a lot of these companies

01:03:10.400 | have figured out how to do custom basics that can do this massively parallel processing. And what

01:03:15.200 | you're now seeing is chips that are designed against specific models that are optimized for

01:03:20.240 | them. The other thing that you're also seeing is that some people are saying, well, you know what,

01:03:24.240 | for these massive models, actually, you should just run it all in memory. And so you're having

01:03:29.440 | folks that are doing it in, in massive arrays of FPGAs. That was Microsoft's first attempt at all

01:03:34.880 | of this. So what is the point of me telling you this, I think that, again, we talked about this

01:03:39.920 | last week, the biggest cheerleaders of this first point of value creation has really been Wall

01:03:47.040 | Street and family offices that wanted to front run where the value creation was going to initially go

01:03:53.120 | and they've been right, which is around chips. But there was a tweet and Nick, I posted it,

01:03:57.200 | maybe you can throw it up here that shows that if you compare this to the mobile internet,

01:04:01.040 | there's always this phased approach in terms of value creation, where let's just say,

01:04:07.040 | initially in a new market mobile, a decade ago, and AI today, the first dollar of profits tends

01:04:13.600 | to go to the chip companies, that makes a lot of sense, right? Because they're the ones that

01:04:17.360 | are in the bowels of making the elemental capabilities possible. And then you transition

01:04:24.320 | that value. And what freeberg says is people realize, hey, hold on, the profit dollars are

01:04:28.160 | not going to accrue there. Because again, this beautiful principle of capitalism is that you can

01:04:33.840 | only over earn for a certain amount of time, because then competitors emerge and say, hold on,

01:04:39.840 | I want to steal those profit dollars from you and take them for myself. So margins compress,

01:04:44.560 | right. So in the end, and videos gains today will be then spread across Nvidia,

01:04:50.480 | Facebook will have their own chip, Amazon will have their own chip, Google already does.

01:04:54.240 | Apple will have their own chip, all the memory companies will be in this space, right? So then

01:04:59.840 | the profits get smeared there, multiples compress, then where does the value grow to the device

01:05:04.960 | companies in the mobile internet? Here, I think we still have to debate what is a device company

01:05:10.400 | in the world of AI. But the most important thing I think to remember is that where the real value

01:05:15.840 | gets accrued is 567 years later, when the software and services companies show up and create a huge

01:05:23.280 | moat. And those are the Googles and the Facebook's and the apples of the world. And so it's a really

01:05:28.720 | dynamic moment. I think it's wonderful for Nvidia. It's an amazing story for Jensen, who's

01:05:33.680 | been really at this game for a very long time. By the way, there's a Jensen has a law of his own

01:05:40.240 | that is a sort of companion to Moore's law called Wang's law named after himself, which you can read

01:05:44.960 | about, which just talks about the variability of the compute capabilities of GPUs versus CPUs. So

01:05:51.200 | if you want to know that he should get some credit for that. But I think it's great. I think we're in

01:05:55.440 | the Apple is also making their own GPUs. That's what when you hear the M two that has GPUs in it.

01:06:01.920 | So yeah, you're absolutely correct. Anyone. So we're gonna have a few years, we're gonna have a

01:06:06.240 | few quarters for sure of this hype. And then the smart money will probably figure out where the

01:06:11.760 | next the lily pad is. And then they'll go to the next beautifully said, beautifully said.

01:06:16.480 | Any other thoughts, free break as we wrap up on that, I wanted to show this AI demo from

01:06:22.000 | Adobe Photoshop, you know, every week or so, we see something that's incredible. And this one was

01:06:27.840 | we shared in the group chat. But for those who don't keep up this out, you know, so what we see

01:06:33.520 | here, if you're listening, is, you know, taking a Photoshop creating an area and then instead of

01:06:40.320 | like, cutting and pastes, pasting or refining it, you're putting in a text prompt and saying, Oh,

01:06:45.280 | put expand the and make this widescreen or let me grab this deer out of a forest and then put it on

01:06:54.480 | a wet alley at night. And then you know, let me highlight this wall over here and put a sign and

01:07:00.320 | put a red arrow sign and it just generates it and it's doing this, they made specific note when they

01:07:06.000 | launched this that all of this is done with stock photography, they have the complete license to

01:07:10.240 | so they can monetize this without getting sued. Like Microsoft is currently being sued. And

01:07:18.480 | Microsoft actually, in addition to the GitHub lawsuit, it's turns out Twitter sent a letter

01:07:25.120 | over to Microsoft as well. So incredible demo, the producers here at all in as our production team

01:07:33.440 | grows. Producer Brian made a little video here. Here's chemoth in before the Laura Piana days.

01:07:40.160 | That's that's Tom Ford. Yeah, that's Tom Ford. This is when bad hair, terrible hair is terrible.

01:07:46.960 | You look tired. The watch. No, I had a night. My god, I played poker. Literally, I walked into that

01:07:55.680 | to that. See, I'm straight from the poker table. Brutal to the squawk. Wait, no tie. But he's

01:08:05.200 | wearing a tie. There's a Tom Ford. Yeah, he said, Did you he said, try this without the without a

01:08:09.440 | tie. I said, Okay. Oh, you were talking to Tom Ford. Great. What a flex. You know, Tom Ford is

01:08:14.160 | probably twice in my life. I can tell you both stories. Okay, well, hold on a second. He said,

01:08:17.920 | we're degenerate AI and make a yellow sweater is the prompt here. Let's see if he goes to Bert.

01:08:23.360 | From Ernie to Bert. There is Sri Lankan Bert, as we call him in the not that doesn't quite get the

01:08:30.800 | borders right. It looks like a Warriors jersey. Oh, there you go. Pretty bad. Yeah. Yeah. Change

01:08:38.480 | my hair bro. Change my hair. I think the demo was bullshit. Change his hair. Can we can we have the

01:08:43.120 | hair be less in sync? Less Hasan Minaj and more given I understand why they call you a Z's. I'm

01:08:50.720 | sorry. I think the you had the hair going there. The hair. Yeah, it's a lot of lift. And what was

01:08:56.080 | that day? Buddy? What is that? Is it putty? This is like eight years ago. Is it what are you using

01:09:02.880 | clay or putty? What do you Yeah, it's like it's like a stiff. It's like a stiff hair wax. I think

01:09:07.120 | it's a hair wax. Got it. Yeah. I've come such a long way since now. Much more. Much more stylish.

01:09:13.440 | I mean, look at sex is crazy hair as we as we probably did in the cold open. My thought on

01:09:17.600 | the Adobe thing for what it's worth is like, I mean, do they want a mulligan on this $20 billion

01:09:23.280 | Figma thing or do they get to see the ongoing revenues that Figma is generating? I don't want

01:09:30.880 | to curse you. Sure. They're looking to Lena Khan, all kinds of stuff. It's a different product,

01:09:34.880 | though. I mean, the AI stuff certainly has had an impact. But I mean, so much of the benefit of

01:09:39.200 | Figma is it's web based. It's collaborative. It's like people kind of use it online to make stuff

01:09:44.000 | together. It's a little different than the other tools that they offer today. So you don't think

01:09:47.840 | it from September to now? Like, nothing changes, they should just close this thing at 20 billion or

01:09:54.800 | or half their half, they think that they should pay a billion, break it up and then redo the deal

01:10:01.040 | at 10. And then it costs nine, remember, not all breakup fees mean that you can break up for any

01:10:06.240 | reason. So there's only there's limited outs on what you can pay a breakup fee to get out of it,

01:10:11.120 | one of which could be antitrust or regulatory. But otherwise, you may be forced to close in court if

01:10:18.320 | you don't have a valid reason for terminating the deal. Their only hope is to get Lena Khan to

01:10:23.520 | muck it up. Yeah, some leaks come off is your argument more that they bought Figma top of

01:10:30.080 | market pricing, which no longer makes sense? Or is your argument that they're innovating so well,

01:10:34.560 | they don't need it. I think it's a little bit of both. But it's, it's more that I think this

01:10:40.640 | generative AI stuff allows you to refresh I tweeted this out. So Nick, maybe you can put it up there.

01:10:44.960 | But I think the first thing is that your feature set can catch up pretty quickly. So even if you

01:10:50.720 | set out a team and said just copy exactly what Figma has, with a co pilot, enabling 50 engineers,

01:10:57.920 | that's like 500 engineers cranking on something, I would be surprised if they couldn't just

01:11:02.720 | replicate the product end to end. That's the first thing. Then the second thing is,

01:11:05.920 | I think that you've seen VC funding basically crawl to a halt. And so the question there is

01:11:13.920 | how many of those companies are just going to stop spending because they're just not going to exist.

01:11:17.600 | And then the third thing is, if we're sort of hashtag austerity, people are going to look at

01:11:25.120 | everything they're spending money on and try to be really disciplined about it. If you roll all

01:11:30.240 | those things together, sacks, my thought is, maybe the deal still makes sense. But does it make sense

01:11:34.720 | at 20 billion? And does it then just create a whole suite of shareholder lawsuits after the

01:11:39.120 | fact that are just going to say these three things and regurgitate them ad nauseum? That's the

01:11:42.560 | curiosity I had? Well, so we're here, let's talk a little bit about the state of Silicon Valley

01:11:48.000 | sacks. We were talking offline after the show last week. You've slowed down investment at your

01:11:55.680 | firm craft, you're being thoughtful, you're working on the existing portfolios, how would

01:11:59.120 | you describe your activity so far in the first half of 2023 as a firm if you're so willing to

01:12:05.200 | share that my take on what's happening in Silicon Valley right now or tech more generally is it's a

01:12:10.000 | tale of two cities. It's the best of times for AI startups and the worst of times for everybody else.

01:12:15.440 | The AI startups, there's a lot of interesting things happening in there and money is being

01:12:19.440 | pushed at them by VCs. It's very frothy, arguably bubbly. But then at the same time, if you're a

01:12:26.640 | pre AI company, maybe the one that raised a lot of money at a big valuation in 2020 or 2021,

01:12:32.160 | it's a pretty tough time. I don't know of any startup, especially like later stage startups

01:12:38.160 | who are hitting their numbers. Everyone is reforecasting down, everyone's missing. I think

01:12:43.200 | that speaks to the larger economy is not doing that well. I think the economists a year from now

01:12:48.960 | may say that the recession had already begun. It certainly feels like that.

01:12:52.480 | That's what Druk said at the Sohn conference. I think that startups are absolutely seeing that

01:12:56.880 | in their sales right now. Sales are slipping, it's taking longer, buyers are sharpening their

01:13:02.720 | pencils. It's a really tough environment, I think, for software startups that are actually trying to

01:13:07.600 | make sales. AI startups are a little bit exempt for that because people are still investing based

01:13:11.520 | on the dream, not based on the metrics. I would say that we're very interested in AI and we're

01:13:18.320 | starting to make some investments, but we also like to invest based on metrics, not just on a

01:13:23.920 | dream. We're being somewhat cautious about how we approach it. You make a small seed bet in somebody

01:13:29.360 | who has a dream, if I can translate here, but if you're going to make a bigger bet, a series A,

01:13:32.800 | series B, you're going to want to see some numbers on the board. You're going to want to see some

01:13:35.600 | product and market. I think that's a really good way of putting it because I think the standards

01:13:38.880 | change at each round. At the seed stage, you can absolutely just make a bet based on the dream or

01:13:44.800 | just based on a founder. Great founder going after the AI space idea, still a little bit to be fleshed

01:13:51.920 | out, you can make that bet. 500k, 750k. Even 3 million will do as a big seed round. Then when

01:13:59.440 | you get to series A and you want us to write a 10, 12, 15 million dollar check, we kind of want to

01:14:03.600 | see some revenue. Certainly by the time you get to series B or series C, we want to see all the

01:14:09.920 | standard metrics. We want to see net dollar retention, expansion, all that kind of stuff.

01:14:13.440 | Yeah, it's really hard for the later stage startups because they raised, and this is the

01:14:18.160 | lesson, if you're raising at three, four, 500 million sacks, correct me if I'm wrong here,

01:14:21.760 | you have to build into that valuation. Let's face it, that valuation A was never realistic,

01:14:29.680 | it was overpriced. Then B, you got the headwinds and your customers are saying, "Oh, you want 40,000

01:14:34.240 | a year for this last product? We'll give you 12." What position are you in to turn down the 12? You

01:14:38.240 | got to take the 12 because you got three competitors who are going to roll up and take the 12.

01:14:44.080 | It's hard.

01:14:45.600 | Actually, can I give you an update? Remember I mentioned there was a startup in my portfolio,

01:14:49.920 | actually my angel portfolio that was doing a beta play around, the cram down. I think it's

01:14:56.000 | absolutely tragic because of what I learned, which is the founders got crammed down too,

01:15:00.240 | because a year ago they brought in a professional CEO. I think as a result of this, they're probably

01:15:06.080 | going to get nothing for 10 years of work, whereas if they had just cut costs, the company has 32

01:15:13.280 | million of ARR. Imagine if they cut their opex to a million a month, they could have run $20

01:15:18.320 | million of EBITDA, pivot to the basic private equity model, sell that company for 150 million,

01:15:24.720 | half would have gone to pay off the investors and the other half would have gone, a lot of it would

01:15:28.320 | have gone to the common, they probably would have made $10 million each. Now they're going to get

01:15:31.360 | zero because they burnt too much money, didn't want to cut costs. They bought into the dream of

01:15:35.520 | bringing in the professional CEO who's going to reaccelerate growth. It never does. It's so

01:15:41.600 | frustrating to me because I feel so bad for these founders. I wish they had called me a year ago

01:15:46.080 | and I would have been one of the guys pounding on the table, "Just cut costs."

01:15:49.600 | And then control your destiny.

01:15:50.880 | Because listen, yes. And here's the thing is, if you're only growing 10, 15, 20%,

01:15:55.200 | or even 50% a year, you're not a VC backable startup. You're a private equity play. So you

01:16:01.520 | got to pivot to that model of making your business work as a cash flow positive business. That's how

01:16:06.880 | you're going to get an exit. And if you're growing 100% plus a year, you can continue to be VC back.

01:16:11.920 | So it's so important for founders to understand whether they're even eligible for venture capital

01:16:16.400 | anymore. And if they're not, you have to make a different kind of model work if you want to

01:16:20.960 | see a return.

01:16:21.840 | Yeah. And when this happens, a cram down round,

01:16:24.560 | those founders, if they want a refresh, they have to prove their worth. They're not just going to

01:16:31.120 | get a refresh to keep the relationship going. This is $30 million in revenue. They don't need

01:16:35.840 | the founders anymore.

01:16:36.720 | Look, these guys have been working for 10 years. So even if they got a refresh,

01:16:39.360 | they had to put in four more years of work. And the other thing is this cram down round,

01:16:43.760 | I think was way too big. They raised 25 million with a three x lick breath.

01:16:47.440 | So 75 million off the top,

01:16:50.800 | Off the top, then you got to repay back.

01:16:53.280 | The VIG is triple?

01:16:54.560 | Yep.

01:16:55.700 | Oh my God, who this is where board governance is so important. Shemot, huh? Like, I mean,

01:17:01.040 | who is on the board of these companies? We told

01:17:03.760 | Unfortunately, I was not on the board.

01:17:05.920 | Idiots are on the boards of these companies. These are people who've never had to build a company.

01:17:12.720 | And they may be educated, or they may have been an exec at a company and then some VC who was

01:17:18.800 | feverishly raising funds, just hired some dope, put them on the board of this company.

01:17:24.240 | And then just the stupidity compounds and trickles down.

01:17:26.960 | It's so frustrating.

01:17:27.840 | Compounding stupidity.

01:17:29.040 | This is the beginning of the beginning. All of these people who have zero judgment are

01:17:33.360 | going to fuck so many companies up. It is the beginning of the beginning.

01:17:37.680 | And Shemot, it's not just the bad board members. It's the view for so many years that who you put

01:17:44.000 | on your board didn't matter. And remember, there was all these VCs who had a model where it's like,

01:17:47.840 | well, we don't take a board seat. And they were selling that to founders as a positive.

01:17:52.080 | As a feature.

01:17:53.040 | As a feature, not a bug. And the reality is for a lot of

01:17:55.680 | VCs, actually not being on the board probably is the best they can offer. But, you know,

01:18:01.840 | that model works. That model works when everything is up and to the right, where like this model of

01:18:07.600 | board seats don't matter.

01:18:08.720 | Governance doesn't matter.

01:18:09.920 | That is a model in a boom where everything just keeps going up and to the right. But when you

01:18:13.760 | had a tough time, that is when you need a board member who's seen this movie before, who knows

01:18:19.600 | what a cram down round is, who knows what's going to happen to you a year hence, when you get

01:18:25.600 | screwed into taking a three exit breath.

01:18:27.760 | It's where you want the gray haired pilot, you know, in the right seat to say, hey, listen,

01:18:30.800 | we're going into some-

01:18:31.120 | Yeah, you want this hair. You want this puffy hair.

01:18:32.160 | You want that hair. You want that sexier. All right, Freiburg, you are always candid about

01:18:36.720 | your own journey. You've had huge wins, climate.com for a billy, raising funds, but you know,

01:18:42.400 | sometimes things don't work out. What do you what's your take on some of these hard lessons

01:18:46.080 | of great ideas, you know, spun up during this really hard market?

01:18:50.880 | I mean, I think just to echo the point you guys are making in the last

01:18:54.800 | 15 years, we've been in a call it structurally inflated environment because of the zero

01:19:03.440 | interest rate policy since the financial crisis. And everything's been up into the writer so much,

01:19:08.400 | it's been so easy to kind of inflate things, fill up hot air balloons and go up into the right.

01:19:11.840 | And unfortunately, most folks who are working in the investor community that are sitting on

01:19:17.840 | boards weren't around for the.com crash the last time this happened. And I think, you know, just

01:19:22.960 | to kind of echo your point why it's so challenging, I think right now to figure out a way out.

01:19:27.120 | There are, there's a lot of failure going on in in Silicon Valley right now, you know,

01:19:33.840 | sacks, you talk a little bit about having paths for exit and options for SAS companies, but there

01:19:38.160 | are many sectors in startup land that don't have those sorts of options in biotech, in sin bio,

01:19:44.400 | in FinTech, and direct to consumer e commerce. There's a lot of markets that a lot of types of

01:19:50.960 | businesses that feel like there isn't a great way out. And it's having a deep psychological toll

01:19:56.800 | on entrepreneurs on founders on CEOs, and everyone is experiencing some degree of failure in this

01:20:03.200 | environment. There are very few folks who aren't feeling this acute pressure and this acute pain.

01:20:07.440 | You know, I heard some pretty horrific stories this week from a friend of mine and someone who

01:20:12.560 | ended up in the hospital because of the pressure he was under. And it's really trying and you know,

01:20:18.240 | even within our friend group, I mean, not not our direct friend group within our broader community

01:20:22.400 | of investor friends. There are very few people who aren't feeling this extraordinary pressure that

01:20:28.160 | they've got a book that is declining in value, and they don't know how to get out of the hole.

01:20:32.160 | And you know, that pressure is like, is generates deep questions about one's ability and generates

01:20:40.640 | deep existential thought for entrepreneurs and investors about what the hell am I good at.

01:20:46.640 | And no one's really talking about this out loud. But it is a happening across the valley. We all

01:20:52.160 | have these thoughts. We all have these dialogues. As the failure begins to set in, in the slow

01:20:57.440 | motion train wreck of a market that we've all been talking about for weeks and months, how do you

01:21:01.840 | deal with it? Look, I mean, I just think that number one, it's worth acknowledging, and it's

01:21:06.080 | worth having the conversation that no one is alone going through this pain. It is not a one off that

01:21:12.480 | these companies are failing, it is that we are all dealing with failure right now. And we are all

01:21:16.880 | trying to figure out what is the best path forward. And it is the kind of thing that you just have to

01:21:22.000 | work your way through and you have to persist through this pain. But this existential question

01:21:26.160 | of Am I good enough? Do I have the skill set I thought I had? Am I just an idiot? Did I blow it

01:21:31.680 | up? Emperor has no clothes, all the kind of inner fear and turmoil that everyone's dealing with,

01:21:36.640 | you're not alone going through it. A lot of entrepreneurs, a lot of investors are in the

01:21:40.960 | exact same place. Now, with respect to going forward, I think having integrity with respect

01:21:46.800 | to how you handle these situations and having thoughtfulness about, you know, your reputation,

01:21:51.280 | because this is not a one and done environment here in Silicon Valley. failure is part of the

01:21:57.120 | process. And how you deal your deal, deal with people deal with investors deal with entrepreneurs

01:22:03.280 | deal with each other deal with your employees during these difficult times says a lot about

01:22:07.520 | your character and your ability, that when you do this, the next time, it will set you up for

01:22:12.160 | success. And you know, as any great athlete will tell you, you build muscle during the times that

01:22:17.920 | you're failing, and then you're ready to go and execute the next time around. So you know, let's

01:22:21.840 | save it for the next quarter. But let's play well as best we can right now, through this quarter,

01:22:27.280 | Chamath clearly, you want to jump in here. What are your thoughts on separating your identity from

01:22:34.160 | your startup from your work and having a more balanced view of yourself so that when things go

01:22:38.480 | wrong, maybe you're not as devastated, you don't wind up in a hospital bed when things go wrong.

01:22:44.000 | They go wrong in bunches. Just like when things go right, they tend to go right in bunches.

01:22:52.400 | I called free bird last week, and I was telling him a story

01:22:58.640 | about two or three of my businesses just all just pounding eating dirt. And what I said to him was,

01:23:07.200 | and then we have a mutual investment that's doing pretty well. And I needed to use the one that was

01:23:16.720 | doing well to make myself feel better about the three that were eating dirt. And I said to him

01:23:22.640 | something he liked, it's just like nothing is working. I feel like literally nothing is working

01:23:27.920 | and a place to be. The only thing that you can do in those moments is just realize it would be so

01:23:34.000 | much worse to just be on the sidelines. Oh, I like it. And I think that's all you can do. Then you go

01:23:40.560 | and hang out with your friends. Go hang out with your family, kiss your wife, have as good of a

01:23:48.400 | time as possible outside the context of work, and then you just start the grind again. But yeah,

01:23:52.720 | we are in a moment where in most companies, there is something pretty wrong. It's either your burn

01:23:59.680 | product, your track customers team, cap structure and riff cap table. Yeah. And by the way,

01:24:07.040 | that's always the problem. But it tends to be balanced by a few things in your portfolio that

01:24:13.600 | are always going well. So that as an investor, you can maintain some equanimity through the

01:24:19.360 | whole process. But freeberg is right when there aren't enough of these positives, and there's just

01:24:24.080 | a parade of terribles. You're just like, wow, this whole portfolio. Is it all about to fail?

01:24:29.600 | And then I get a massive wave of imposter syndrome of like, what am I doing here? And then I have to

01:24:34.080 | recognize, holy shit, this is my 24th year. Take a deep breath. And it's great that it's that

01:24:41.840 | exhilarating where I think it's back to 2000. I just emigrated here. That's the conversation

01:24:47.040 | Samantha and I had beautiful talking about like a string of difficult things we're all dealing with,

01:24:51.280 | you know, a couple weeks ago, we announced that we returned all the money to all our

01:24:55.200 | customers at Canada, which was this molecular beverage printer company I've been working on

01:24:59.840 | for a few years. I plowed north of $30 million of our capital into building this business. We

01:25:05.280 | had two term sheets last year, both of which vaporized as the markets that degraded it was

01:25:10.880 | really a brutal experience for me. And these were very high valuations. And we were, we needed

01:25:15.440 | funding to get the production line stood up to manufacture that device. So we were that close.

01:25:19.760 | I mean,

01:25:20.400 | and as the market went south, pre revenue hardware companies became less fundable. And despite our

01:25:26.400 | reputation and a great working product and a product and a manufacturing ready prototype,

01:25:30.480 | we couldn't get it done. It was a really kind of brutal experience to go through

01:25:33.840 | the nose, even after you've had a lot of success in your life, believe it or not,

01:25:38.000 | you still get a lot of friggin nose. And you get a lot of I don't believe us. And then to just have

01:25:42.480 | to get to a point with this one was really difficult. And there's, you know, been other

01:25:45.440 | kind of frustrating experiences of late. And then, you know, you kind of have a call one day

01:25:49.760 | with another investment. And you're like, Oh, my God, this thing could be a home run.

01:25:54.080 | And that just comes out of nowhere. And, you know, as long as we kind of stay in it,

01:25:58.800 | as an investor, and you keep, you know, as a builder, and you kind of keep building,

01:26:03.760 | you don't know when that good knock on the door is going to come.

01:26:06.800 | Yep. You got to stay in the game.

01:26:08.960 | You got to stay in the game.

01:26:09.520 | Building a business, and one day you just nail a sale that you just weren't expecting or a

01:26:13.920 | partnership, or an M&A inbound or something that happens that you weren't expecting, it pays for

01:26:19.680 | all the pain, and all the loss and all the turmoil and all the downside. I always used to tell people,

01:26:24.800 | for every, you know, four days, I'd be failing, I'd have one day of success. But that one day of

01:26:28.960 | success will get me slightly ahead of where I was at the start of the week. But 80% of it was failing.

01:26:33.680 | I mean, right now, it's like 19 days of failure and one day of success. But that one day of

01:26:37.760 | success, the goal is used to have a couple of those punctuated moments that are big enough

01:26:41.360 | that make up for all this stuff. If you just keep grinding, and if you just keep grinding as an

01:26:46.720 | entrepreneur, you keep grinding as an investor and stay in the game, lives with the power law,

01:26:50.720 | you're describing living with the power law.

01:26:53.360 | There's a very relatable poker analogy in this. There's a there's a guy that makes

01:26:56.800 | poker content. His name is Jonathan Little.

01:26:58.880 | He's great. He'll be at the Angel Summit.

01:27:00.800 | He's wonderful. I've been thinking about hopping into one tournament at the WSOP this year.

01:27:05.680 | It's one of the big buying tournaments. So I'm like, let me just take a little tournament

01:27:08.720 | refresher. And I was just looking for any content and I found his and he had this beautiful slide,

01:27:14.640 | which he said, if you are a mid level poker player, you should expect to final table

01:27:24.080 | every one in 100 tournaments, roughly. And I thought about that for a second. And I was like,

01:27:33.040 | that's a 1% success rate. Now, if that is your 99th tournament, you have to be pretty resilient

01:27:39.680 | to go through 98 losses where you don't cash, you don't make the money, and you're just putting

01:27:44.800 | money out, you're deep in a J curve. And you're like, is this ever going to work out for me?

01:27:48.560 | And so it's a really, really good reminder that it is the grind.

01:27:52.800 | Yep.

01:27:53.600 | And I thought that was really interesting.

01:27:56.080 | So you had a single or double, I guess, with call in, maybe you could talk a little bit about that

01:28:01.680 | experience and what decision you made there. We were obviously investors. So we're a bit conflicted,

01:28:06.560 | but I'd love to hear your candid thoughts on why you decided to sell.

01:28:09.440 | Yeah, we put together a great team, and they built an amazing product. I think it's by far

01:28:13.360 | the best sort of social audio product. And then actually, they added video to it as well

01:28:17.840 | and podcasting features. So it's kind of the synthesis of video and audio podcasting with

01:28:23.200 | social audio, we got acquired by rumble, it's sort of like a base hit type acquisition. It's,

01:28:28.320 | it's a small deal, relatively speaking, but the team wanted to do it. And then the main reason is

01:28:33.200 | because we got to hundreds of 1000s of users, but in the consumer space, you really need to get to

01:28:38.320 | millions. And frankly, 10s of millions is what it takes to have a successful consumer product.

01:28:44.080 | Rumble does have 10s of millions of users. So the team wanted to find a home. And there's a lot of

01:28:50.880 | synergy with rumble. Both companies have a mission that's aligned around free speech rumble sort of

01:28:56.640 | the call it free speech alternative to YouTube. So video platform. And what Colin will do is give

01:29:02.960 | rumble studio capability. So it'll be very synergistic for all their creators to be able to

01:29:06.880 | create content in call and then post it in rumble. So it's not, you know, a huge outcome for anyone,

01:29:14.160 | it's sort of a push for the investors, depending on where rumble stock ends up. But look, it's just

01:29:19.200 | you can build a really great product and a great team. But unless you hit that lighting a bottle

01:29:23.760 | of distribution, you know, you won't get to the next level. So I'm happy about the deal. I think

01:29:28.240 | the team's happy about the deal. And it's a good outcome for for everybody involved. But it's not

01:29:33.280 | you know, it's not a home run. It's just, it's more of a base head. And that's what most of these

01:29:37.040 | things are. Yeah, getting used to a high failure rate, and living inside the power law where one

01:29:43.840 | investment out of 30 or 40 or 50 results in 90% of your funds returns for you know, that specific

01:29:50.640 | fund or so or maybe two wins represent 95% that's a hard thing for the human brain to handle as is

01:29:56.720 | the J curve as Chamath you know, points out correctly, man, you invest for two or three

01:30:02.000 | years and then you watch all those things go down in value for two or three years of the value I'm

01:30:05.600 | sure of the portfolio go down for two or three years before it actually rebounds and goes back

01:30:09.840 | up. I remember, man, I had a run where everything I touched turned to gold. And then Mahalo hit 10

01:30:15.200 | million in revenue and then boom, Panda update. And it just goes up in smoke. And you're like,

01:30:19.760 | what what just happened? I saw weblogs 18 months after starting it I you know, had the

01:30:24.080 | Silicon I report I just Uber investment everything I touched went to the moon working. Yeah, yeah.

01:30:29.440 | And then it's just a very frustrating experience where you can't make something work. And you know,

01:30:33.520 | like, I should be able to make this work. Why isn't it working?

01:30:36.160 | There's a very heavy blanket of humility setting over Silicon Valley right now. And I think all of

01:30:41.360 | us who have had strings of successes and repeat successes and you know, things that we touch have

01:30:47.120 | worked, and we do all the same things and we do the right things and we do them the same way in

01:30:51.440 | the right way. And it doesn't work and then it doesn't work again. And then it doesn't work

01:30:55.200 | again. It creates a very different psyche, whether you're an entrepreneur building a business or an

01:31:00.880 | investor investing in businesses, that what used to be the case isn't the case anymore as the tides

01:31:05.920 | have shifted. It's, it's a daunting challenge to work your way psychologically through this moment.

01:31:13.760 | But you know, progress doesn't change. Innovation isn't going to stop technology isn't going to keep

01:31:18.720 | shifting forward. And the opportunities to continue to build and innovate are not going away. So I for

01:31:25.360 | one am deeply optimistic and excited about what the future holds. But man, you got to put your

01:31:29.520 | freaking game face on right now to get through this. Yeah, for sure. Well, yeah. And I would

01:31:33.440 | say there's one other exogenous variable here, which is I don't think any of us realized how much

01:31:39.440 | our sentiment was affected by one guy's decision at the Fed. Yeah, like what interest rates are

01:31:46.640 | going to be visible hands. Yeah, because you know what, when there's a lot of money in the system,

01:31:50.960 | everyone feels great. And all the portfolios look great. And when the money is being sucked out of

01:31:55.600 | the buyers are buying and oh my god, like when the money is being sucked out of the system,

01:32:00.080 | everyone's results look terrible. Yep. It's you know, it's like before a tsunami,

01:32:04.400 | the big wave gets pulled out and then this tsunami comes in. Yeah, it's literally we're

01:32:08.000 | getting sold out. The money is being sucked out of the system like the tide before tsunami and

01:32:13.120 | tsunami is gonna be all the failures and bankruptcies. But what I would say is just in the

01:32:17.840 | same way that things weren't as good as they appear to be during the asset bubble. They're

01:32:23.600 | probably not as bad as they appear to be now. However, you have to give yourself time to get

01:32:28.720 | through this recessionary cycle. And it's so frustrating to me when founders don't want to cut

01:32:35.440 | their burn. The burn is the one thing they totally control. And they have all these excuses for why

01:32:40.480 | they can't cut to an earlier level spending that they were the company was working fine at. And we

01:32:45.440 | can't get them to go back to cut back to some earlier state of being. Zuckerberg can do it,

01:32:51.440 | they can do it. And you know, after seeing what Elon did at Twitter, where he reduced the staff

01:32:56.080 | by 80%. I'm like, I realized there's no good excuse anymore. Yep. We're not giving yourself

01:33:01.600 | the maximum chance of survival. And if you overcut, like he admits he probably did he literally in the

01:33:07.440 | the Dave Farber great interview he did with him. He said, you know, like, we probably overcut,

01:33:12.400 | we cut people who are great. And we hopefully can welcome them back to Twitter as we get this thing

01:33:18.080 | on stable footing. But we're gonna make mistakes because we had an existential crisis. Elon Musk

01:33:22.480 | cut too many people admits it and says he's gonna bring them back. It's no fault of theirs. And he

01:33:26.720 | said he's going back into growth mode. So you know, like sometimes you cut, you might cut too

01:33:31.280 | deep is the point. And you know, that sets you up for growth in the future. Chamath you had something

01:33:34.880 | you wanted to add. I have two shout outs. Okay, here we go. The first is to one of our besties

01:33:40.160 | got a text from Jason Kuhn. He binked the main event at the Triton for two and a half million.

01:33:44.960 | Yeah. I mean, he's so strong. He's a guy's a beast. So it's so great to have a professional

01:33:52.000 | poker player in our circle. Finally, like somebody who's consistently over time, we can learn from

01:33:57.120 | Yeah, like, but he's so open and he teaches us around him, you know, rationally stable, rational,

01:34:04.000 | humble, humble, professional poker player, like happens to basically be the best poker player in

01:34:08.640 | the world. But you could you would never know it. You'd never know. He'd never bring it up. Like

01:34:11.920 | he is literally the greatest and he won the Triton 2.5 milli. Yeah, the second the second

01:34:17.600 | shout out is, here we go to the Model Y team at Tesla. I have been a diehard Model X user

01:34:26.880 | from the beginning. Right? I think I had here we go number 13. So I've been I've been I've had three

01:34:32.400 | or four of these things. And I was like, Wait a minute, maybe this why is really all it's cracked

01:34:37.440 | up to be and I'm a bit of a curmudgeon and I have high expectations. But I just want to say,

01:34:42.000 | that car kicks absolute ass. It is perfect. In cretino. It is incredible that model why

01:34:48.960 | is going to be the best selling car. Yeah, it's going to be the best selling car in America.

01:34:53.280 | If you get the base level, it's actually cheaper than the average car in America now with incentives.

01:34:58.320 | Yeah, it's so, so good. So huge shout out 300 miles range, huge, huge, huge shout out to the

01:35:05.520 | Model Y team at Tesla, you guys nailed it. Yeah, it's an incredible product. And we I love it. I

01:35:12.800 | don't want to diminish the x. I don't want to diminish the x either. But the y is so snappy.

01:35:18.480 | It's incredible. It's the best car ever made. It is the best. Yeah, it's a great car. It's a great,

01:35:23.360 | great car. I can't wait for the Cybertruck. That thing looks like a beast. I can't wait to take

01:35:27.680 | that up. I love the roadster. I love the roadster. You know, I've been taking my 12 year old roadster

01:35:34.000 | out. And my kids love going for ice cream in the the original roadster 1.0. So I've been taking it

01:35:39.760 | out every weekend or two. Number one, you have number 16 of the roadster, which somebody offered

01:35:45.120 | me a quarter million dollars for I paid 160 for it. I have number one of the Model S signature

01:35:50.560 | series. So I have signature 16 of roadster, they did 100 signatures, and they did 1000 signatures

01:35:54.960 | of the Model S. And I have number one of that and somebody offered me a million dollars for that

01:35:58.880 | I have number of the founders edition number 13 of the x. Yeah, that's pretty special. Yeah,

01:36:03.680 | I'd hold on to that. Yeah, there. It's a special vehicle. All right. Listen, everybody.

01:36:09.040 | All in summit is basically so how are we doing? How's the all in summit doing guys?

01:36:14.400 | We're starting to do our outreach and figure out speakers. Yes. Yeah. So it's exciting.

01:36:19.600 | All right, everybody for the Sultan of science, the dictator, and Steve Bannon 2.0 David Sacks,

01:36:27.120 | the architect, the architect, the architect, I like that I remain. Even after sex is triumphant

01:36:34.800 | spaces, I remain the world's greatest moderator. So excited for this weekend, boys.

01:36:39.120 | See you tomorrow at the tarmac on the tarmac. Bye bye. Love you.

01:36:42.880 | Love you.

01:36:44.880 | Your winners ride.

01:36:45.760 | Rain Man David Sacks.

01:36:48.640 | And it said we open sources to the fans and they've just gone crazy with it.

01:36:55.760 | Love you.

01:36:56.080 | West Queen of

01:36:57.120 | King.

01:36:57.360 | Besties are gone.

01:37:05.600 | That's my dog taking a notice in your driveway.

01:37:12.240 | Oh, my gosh.

01:37:13.840 | We should all just get a room and just have one big huge orgy because they're all just useless.

01:37:18.880 | It's like this like sexual tension that they just need to release somehow.

01:37:21.840 | What you're about to be.

01:37:24.480 | We need to get Merchies are gone.

01:37:29.840 | I'm going all in. I'm going all in.

01:37:40.960 | you

01:37:41.460 | [BLANK_AUDIO]

E130: DeSantis's Twitter Spaces, debt ceiling, Nvidia rips, state of VC, startup failure & more

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