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brian armstrong what's up bro what's up how are you good to see you it's good to see you as well
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yeah jason just pinged me yesterday and he's like why don't you just come on as a guest randomly and i was like okay
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great let's do it it's so good i'm really excited to hear what j cal's intro is for you oh man yeah you guys
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keep you keep getting watered on this ride [Music] [Music] hey everybody welcome to episode 77 of
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the all in podcast less than 30 days for the sold out all in summit and uh there's a wait list but uh sadly
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i don't think we're gonna get to anybody on the wait list we've got a great great episode for you
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i thought i'd bring a bestie guestie in but not tell my bestie so we'll see if they can figure out who's coming on the
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pod today uh but let's get the intros over with he's investing in sas at different
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stages coming off a miami bender for the ages doing shots with her boy and vanilla ice the rayman is back
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he's twice as nice david sacks everybody how are you sir how was your adventures
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uh with vanilla ice yeah i'm still here you're still here and so vanilla ice uh that costs sixteen hundred dollars to
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get him to show up what is cost to show up for a party that's about 10k i think it's about 10
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to 20. no a little bit more really a little more and did you go on stage and do ice ice
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baby with him i didn't but uh there's some like teenage mutant ninja turtles type dancing around with him
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whatever it was interesting it was interesting people liked it it was fun it was fun oh very nice very nice and
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you're still in miami for uh whatever tech week okay so he won't eat your meat but i'll take
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your mdma he's very interested in your dna when he's in the lab he's in heaven he hasn't been the same since that rave
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in 1997 the lord of the laboratory the sultan of science david freeburg how are you sir that was my favorite one
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i like that one yeah you peaked in 97 yeah at about 2am you were peaking at about 2 a.m did you say
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he doesn't want your meat but he wants your mdma yes he wouldn't eat your meat but
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you shout out to uh producer nick who really crushed it this week ah his bank this one is too funny
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it's hard to keep it together for these sometimes this bank account would make a
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crown prince jealous his knitwork collection is overzealous when he's on cnbc he makes a scene the last time he
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did leg day was 2019. the supreme leader of spock's the dictator himself i've been actually spending a lot of
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time working out on my legs really i have been working on shoulders and chest and my legs have always been diesel i
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will be doing a shirt off selfie this summer jkl it looks like you have not uh bought new shirts since you lost all the
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weight because that shirt looks about five sides too big i bought this one halfway through
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the weight loss and now it's still too big so i got another slimmer i got the slim fit no i got the normal fit and
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then i got the slim fit from peak to now you've lost what like 50 pounds 213 pounds was my peak like four years ago
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and i was 167 168 the other day yeah so whatever that is 45 pounds it's awesome something
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i feel incredible i started running again and you know i did 40 days of skiing this year and i'm gonna take up
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kite surfing i think this summer i want another sport to do you know in the summers are the people around you
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annoyed at your increased energy levels yes people who work for me are annoyed uh i'm sleeping better uh everything's
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just going better i highly recommend everybody you know just try to lose some weight
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a lot of options out there for you including munique all right we have a very special bestie guestie today
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he's a lean mean crypto machine who sort of looks like mr clean if you need some
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tokens you know who to call satoshi has his picture hanging on his wall his nft game is never lacking if
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you talk about politics at work he might send you packing the king of coins the tycoon of tokens who is he brian
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armstrong riot armstrong armstrong you guys got it brian armstrong's with us hey brian how are you what's up y'all
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you could have gone vitalik uh at the first part but we became brian by the office part anyway
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welcome to the show brian uh we've obviously talked about you a whole bunch and you've been on this week in startups
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and i think you know while the fell is here uh but thanks for for joining the pod thanks for having me this is awesome
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i i listen to your show every week oh thanks for that so i guess you know the the topic we all have talked about a
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whole bunch is um work and keeping people focused at work you took a very bold step which toby at
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chopin i think followed and you said listen if you're coming to work our mission is crypto
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can we stop talking about every other thing in the world and and just stay focused on that and i think that was
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maybe was that a year and a half ago you did that everybody wants to know uh how that
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worked out for the company so maybe you could tell us what it was like to go through that
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because i mean you were a target for for a period of time we all thought seems reasonable
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and then how has that actually impacted day-to-day life for the people who decided to opt into working at a
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single focused coinbase yeah so i would say you know short term it was quite a painful transition i think it created a
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lot of consternation there was you know some folks in the media decided to go call a bunch of people who left the
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company and you know write hit pieces and all that kind of thing and frankly you know about five percent of the
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company opted into the exit taxes package so there was some teams that were short-handed a lot of people had to
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work extra time to fill in the gaps but long term i think it turned out to be an
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incredibly positive decision for the company i do think there's a lot of companies in silicon valley right now
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and probably elsewhere is that you know the ceos and the management team almost feel like they're being held
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hostage by the employees and i feel for some of these organizations you know sundar probably has an incredibly
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difficult job right now we saw that that video from microsoft i think last year with with satya and kind of was with
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people talking about their hair color and stuff and they don't feel like that they can
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really lean in and move the company in the direction they want and they're they're
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fearful of kind of all these internal dynamics so you know i think there's probably a
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better way to do it than what i did which is if you're starting a company today just make that clear up front i
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didn't make it clear up front and so the company culture started to diverge and drift and i had to kind of realign it
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which was which was a painful process if if i was doing it over again i'd probably just set that as the
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expectation up front and then there wouldn't be this you know public awkward realignment but yeah i
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think i'm i'm really glad that i did it i think coinbase has been very productive since then and we've been
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able to attract a lot of the best and brightest people from some of these other companies that are like i don't
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want to be in those companies anymore i want to work at a company where we just focus on the work and the mission
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because that's actually important so i'd say it's been positive brian i've always
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talked about this as being like the difference between a hard culture and a soft culture where hard cultures are
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companies that really define what they do and what they don't do and what they spend time on and
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what they don't spend time on and sometimes what you don't spend time on can relate to products sometimes it can
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relate to things outside or externalities to the business do you think that that's become kind of
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a trend where you know soft culture in silicon valley is more about like appeasing
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a very fickle employee base and as a result you kind of aren't as clear about what you're not going to talk about and
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are going to talk about and suddenly the troops rule the day and things get kind
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of sidetracked and productivity goes down i mean can you talk a little bit about what you've seen
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you know with other cultures around the valley and how that's kind of affecting work and what employees are choosing to
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go to and not go to yeah so i think you know ben horowitz always talked about like wartime ceo peacetime ceo and
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frankly you know i'm kind of a conflict avoidant person right i never thought of
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myself as like wartime ceo we're just like we're all going in this direction let's go go go you know i never really
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thought of myself like that but i think what i'm trying to do now is find the happy medium between these two
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so you the company should have a really ambitious mission and then i think you as a ceo you do have to
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say no to things which are off track from that you do have to part ways with people who are not helping raise the
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talent bar in the company and so in some ways you have to be i guess hard in that sense but i don't think
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it's it's not like you know we're only here to make money and it's like it's bonus time or you're out or whatever
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it's like we actually have a much softer culture than that i think in silicon valley which is most of the missions of
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these companies are trying to do great humanitarian efforts and they're trying to improve the biggest problems in the
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world and so people sign up for those because they want to have a real impact and you know we take time to like go for
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exec off sites and we walk in nature and you know we have like coaching we do all
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this touchy-feely stuff so i think it's kind of a mix of both is the right balance i don't think of myself as like
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you know a wall street hedge fund or like the most touchy-feely culture you can imagine why do you think companies
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now have sort of veered into this place where they have to kind of appease these
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fringes on either side did you spend time trying to figure out like how did we evolve there from just
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being mission focused to having to deal with all this other stuff yeah i mean one theory i have on this is that in
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silicon valley especially pre-pandemic we were all it was so competitive to get talent
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right you know google and facebook they were just kind of one-upping each other on like higher and higher salaries and
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so i i know as a ceo of a company that was rising at that time i felt incredible scarcity like i had people
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leave to get out who got better offers and it was like a real issue and so i was doing anything i could to retain
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people and keep them and so if if an employee said hey i want you know another flavor of water in the kitchen
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or whatever i was like okay maybe we should do it right but i think you know during the pandemic we removed we moved
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to remote first as a culture the the talent like the talent we could get opened up by 100x of people all over the
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world who were really hungry and like frankly thankful for these jobs and that actually changed the scarcity
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mindset a little bit to say hey you know if you don't want to be here that's fine
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we can we have other people we can go recruit and hire in who really are going to value it that's probably just one
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piece of it it's a much more complex issue than that i think one other one other thing is that
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you know like google and facebook i think kind of made this a common trend in the valley where
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companies would host these open mic q and a's on every friday or every two weeks or whatever and it was almost like
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a town hall it felt like a democracy right and in a democracy like the leader you know works for the people they're
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elected by the people um but what got very awkward was at these open mic q as it became you know
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this kind of like hostile thing of like how can we make the person squirm and let's ask them these difficult societal
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issue questions that aren't actually related to the company and what we're all building and
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you know i think that was actually a mistake in silicon valley we've since gotten rid of these open mic
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q as because it really encourages people i'd say one we were like 150 200 people
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everyone was on the same page everyone was asking good questions once we got to like 500 700 people it started to feel
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like there was a little bit of an us versus them and then you know the questions got very off track and i i
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realized at a certain point this is not a democracy i want everyone's input i'm not going to
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rule like with an iron fist but ultimately you know i'm the ceo i need i need to help guide this company in one
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direction and force the hard decisions not everyone's going to like them so we're not going to allow people to do
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grandstanding open mic stuff there's just a little bit of a risk for that you know 99 of people don't do it but even
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one person does it and it kind of creates the snowball effect so we got rid of the open mics people can still
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submit questions but they're there nobody else can see them we read them ahead of the q a and if there's a
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good theme in the questions we address it but you can't like grandstand with an open mic i saw this um so it was in
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twitter nick maybe you can find it but it was like this general that had commanded all of these different
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battalions and he was talking about what it was like in all the different theaters in which he's operated and he
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basically said you know eighty percent of the men and women that served for me were just absolutely incredible you
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could always rely on them a hundred percent of the time they were a hundred percent aligned
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and then he said there was fifteen percent that was wishy-washy and what they were looking for was how you
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managed and dealt with the five percent and the five percent of folks were always trying to push the boundaries and
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try to figure out where the escape valve was or where the exception was or you know whether they would be grandstanding
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or whether they tried to break a rule and he said his entire energy was focused on keeping those folks extremely
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focused and on point or out because that was what solved for the fifteen percent because the 80 would be
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fine but if you didn't deal with the 5 the 15 would go crazy and then the 80 would get dejected and it just kind of
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the whole thing would rot and it was a really interesting reminder that there's these people that come into these
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companies almost with the desire to see these companies go sideways or just waste
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their time which is completely counterintuitive because you think you join for the mission
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but they don't all the time and to be fair you i think told people listen you you could
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as a group of people off hours create your own you know uh dinner party and talk about
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whatever topics you want this is just when i'm paying you to come to work for those eight hours
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you know on the company servers if you're using slack or whatever you know communication platform you're using
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let's just stay focused on getting the work done so this could be a viable enterprise but you were fine with people
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if they wanted to self-organize and do that on their own time correct you weren't saying you can't have political
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beliefs you can't care not care about blm or some right-winger that was one of the biggest um sort of misnomers or miss
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characterizations yeah exactly deliberate mischaracterizations about the policy is that it somehow silenced
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people or prevented them from you know taking positions on issues or donating to causes they cared about the
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policy never said that it just said that while we're in the office together on coinbase time we're going to engage in
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coinbase's mission and avoid fractious debates that divide us yeah that's right and there's a time for those debates and
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it just might not i think a lot of this has to do with slack i'd be totally honest
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yeah when people are in a slack room and they're frustrated and people can have valid frustrations like there are things
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in the world that are horrible and yeah you want to talk about it and yeah you build friendships at work it's
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completely understandable that people would want to blow off steam and but just people have to look at slack as not
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an aol chat room it's not reddit it's not aol chat maybe you could talk a little bit about electronic
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communications and then i think david has a follow-up yes i agree with you slack i think
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you know it's an amazing tool but it does start to turn into social media once you get more than i don't know 500
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people in a room or a thousand people a lot of ceos i've been talking to we're all trying to figure this out because we
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still think slack is a net positive to productivity but it has a huge negative in terms of just both distracting people
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with lots of things popping up all the time but also these kind of social media flame wars that emerge and mob like
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behavior so some of the things i mean we've been trying is for instance if we get any kind of a slacker room that has
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say more than 500 or a thousand people we'll often try to limit it so only you know you can you have to be a vp or
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level 9 and above can only post in there and other otherwise it's read only so we're trying to you know dunbar's number
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is 150 people right you're trying to think who who can you remember everyone's name and have some sort of
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group affinity with them and any too much above dunbar's number we try to like cap it so it's a
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read-only chat room but i think these tools need to keep evolving and i hope some i know there's a couple startups
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you all might have funded some of them um that are working on this yeah there's an actual neat feature you can do in
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slack now where like that level 9 person can post and everybody else can post in
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the thread like you can reply to the thread but the opening salvos and thread have to be started by somebody in that
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sort of group so but slack definitely needs to double down on this i also think they put that random room in there
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and you put the random room it's like basically waving the flag like it's random put stuff in there i think you
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got to delete that if you're running i tell all startups delete the random room and tell people do not post memes and
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jokes david you had to follow up one thing i was going to say is so brian i agree with everything you said the the
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one place maybe where i would nitpick in a way that gives you a little more credit is you found a coinbase back
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in 2012 right yeah so if you had created this policy on day one i don't think you
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or anybody could have predicted that these issues would arise the way they have i remember 2012 was the year i
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sold my company to microsoft we never had to deal with any of this stuff and we were using we didn't have slack back
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then we were using yammer very open culture people could communicate on anything we never had
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sort of hyper activist employees the word woke didn't even exist yet and um it just wasn't an issue so it
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would have required you i think to see ahead so many years and i think what's happened is over the
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last several years there's been this drift towards you know employee activism inside these
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companies i don't think it's coming from both sides of the political spectrum to
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be honest i think it's coming from the sort of hyper woke employees and they engage in petitions and letter writing
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campaigns and threats of boycotts and they sort of hector and mao mao these ceos to basically give in to them and
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we've seen it at apple the way that the apple was pressured to fire antonio garcia martinez and they gave in and now
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they have a letter writing campaign every month and you just saw it in florida i think bob um what's the name
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of bob chapter business i don't think he's going to survive the year after what just happened at disney
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and it's because he gave in to the employees took sides against the you know governor in florida and the
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legislature and they just ripped away disney special privileges in florida you saw it at netflix where ted sarandos was
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sort of malmowed by these employees who want to cancel dave chappelle he ultimately
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stuck by chappelle but only after groveling to these employees and so i think we're
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seeing these issues did not exist even five years ago i would say and i think the reason why the coinbase
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story is so relevant to a broader audience and what you did with your policy is so relevant is i just think
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every company is going to have to make a decision sooner or later or on where they stand do you give in to these
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petitions and mobs and boycotts do you allow unlimited activism inside the four walls of your company or you take some
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sort of more neutral stance where you say listen we're all going to leave our politics to the door so we can
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effectively work together on the company's mission i think every company eventually is going to have to either be
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coinbase or be apple you're gonna have to be coinbase or be disney you're either gonna have to give in to the mob
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and suffer the consequences or you take the short-term pain of doing what brian did
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and you basically realign everyone around the mission and a year later you're very happy with where you are the
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good thing with netflix and disney though is that they're going to be very clear examples of the business impact of
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getting distracted and i think that you know brian took leadership but the business impact at least from
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the outside looking in was not really measurable obviously he felt that the team felt it whatever they did and that
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business is working but it wasn't done as a public company pre and post so the counterfactual is
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hard to measure in the case of disney and netflix it's really clear to measure right meaning
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in all of this confusion netflix has completely botched their business model in all of this fighting now internally
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inside of disney not only are they going to lose essentially a fiefdom inside of
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florida but it's going to have repercussions with respect to taxes with respect to debt with respect to the
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quality of the service they can deploy and that will eventually flow through the business and that will be measurable
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by investors and i think david uh i think probably what i think which is a slighter
00:19:41
sort of more modified version of what you just said is in the next few quarters i think ceos will actually be
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better equipped to numerically point to why taking brian's path is the value creating path for shareholders and for
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stakeholders and the cost of getting distracted quote unquote can be really expensive if you
00:20:02
if you are a for-profit company and you also have the option to run your company
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and say you know what we care about this issue a whole bunch we really care about
00:20:10
human rights here we really care about communications and freedom of speech and i'm gonna run twitter as a freedom of
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speech company and everybody has to align behind that if you believe in censoring this is not the right company
00:20:23
for you if you believe in policing speech or you're uncomfortable with uncomfortable speech uh or speech that
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makes you feel uncomfortable you don't have to work at twitter so it's not like you have to
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you know do what brian did and say hey we're just you got to decide on this you're going to have to make a decision
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and be international about it i think it's the higher order bet no my i was just going to say my only point is in
00:20:42
the absence of intentionality jason you'll slip into one realm or the other and not really know what you're trying
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to do i agree with you and my only point is that you'll be able to measure the impact of unintentionally slipping and
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sliding around yeah versus picking a course and sticking to it let me ask you guys a question if you're an individual
00:21:00
and you want to affect social change where is the forum in the theater that you think you would go to first you
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spend most of your time at work and um maybe you don't have as much free time to go march and protest in the
00:21:14
streets and if you did no one would pay attention to you there anyway so saks like i know that you'll probably
00:21:20
have a point of view on this but like if you're giving a 19 year old who has a strong
00:21:25
point of view or 25 year old who has a strong point of view about something that they want to see change in society
00:21:31
what's the right forum for them to have their protest and to make their voice heard i think that
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companies are a great change agent i think we all do being in silicon valley creating startups we all believe that
00:21:42
startups are a great way to change the world those startups have missions brian's company has a mission around
00:21:47
crypto and ex and um expanding democratizing access to the financial system based on crypto elon has a
00:21:53
company that is accelerating the world towards sustainable transport and sustainable energy
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he wants to make where i equip a little bit with what jason said about free speech i think elon wants to make free
00:22:05
speech restore its place back in twitter's mission so it's not like a separate thing it's actually like should
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be very core to what they do i think that there's a mission-driven company out there
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for any young person who cares about that issue right and if there's not if there's not a for-profit vehicle there's
00:22:24
a 501 you can go join a nominee or star wars or start one exactly donate money to a cause you have the
00:22:31
whole weekend you got me you can write a blog post what i don't think would work
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is when you have people who don't who aren't really mission driven their mission is whatever the current thing is
00:22:40
and so they're just kind of like oscillating from the the one the cur you know from one current thing to the next
00:22:47
current yes and every three months there's an issue du jour that that you know they care about more than anything
00:22:52
else in the world look there's not going to be a company that can accommodate that sort of fickle activism brian can i
00:22:58
ask you a question are there um any um systems decentralized systems that uh kind of give individuals
00:23:06
you know but you viewed interesting models that give people the ability to affect social change um in a way that
00:23:12
kind of historically may have been more of a hill to climb where people can kind
00:23:16
of aggregate resources and aggregate a voice in a way that can kind of affect outcomes and do we think that that kind
00:23:22
of becomes a mechanism for social change in the future you're making me think of dowels and
00:23:26
things like that but i think a lot of that is kind of unproven like daos are probably good ways to get
00:23:31
new kind of governance systems in place for allocating capital or maybe even managing a city or or a society but like
00:23:38
you know i kind of agree with david i think the best way to affect change right now today is for young people is
00:23:43
start a company or join a company i think young people are sometimes a little enamored with like becoming an
00:23:49
activist but i think fundamentally that's you're sort of giving up your power by
00:23:53
saying like well they have the power and i don't and so i'm gonna speak truth to
00:23:56
power but i think you know some there's context for that historically whether that may have been more true but i think
00:24:01
today a lot of people they have more power than they realize and if you go start a company which by the way
00:24:05
companies are decentralized too you can have lots of little companies all over the world um they're not like you know
00:24:11
monolithic usually and so if they start a company they can have a good impact i think on the biggest issues out there
00:24:18
and i think over time as well the way that you have real impact is that you prove yourself in the market of ideas to
00:24:24
have a high reputation and to be really reliable and that is not something that you can just overpower
00:24:31
you know because you're 19 or 20 and you're really upset by something at some point you're going to have to really
00:24:37
invest your time and dedicate yourself to something that you really really care about and then the world tends to move
00:24:43
to the good ideas so i think part of like what we also need to remind folks is that this is a
00:24:49
like if you want to make real sustainable change it's hard it doesn't matter in which area you pick it is just
00:24:55
really hard but if it's really worth it you should give your life to it but what
00:24:59
i think people push back on is the more superficial forms of just virtue signaling and saying yeah in this
00:25:06
moment i really want to pretend i care about something but when push comes to shove
00:25:10
i'm not really willing to take the next step i don't i think that most people find that very unreliable yeah i think a
00:25:15
good question to ask for somebody who purports to really care is like what do you care about that's
00:25:20
not currently in the news you know that's not like the hot thing that everyone is basically
00:25:26
obsessed with well and then how are you changing it and what is your plan to change it over the next decade or two
00:25:31
like you have yeah because it takes it takes it takes many years to effectively create a startup you know five years ten
00:25:38
years and so if your issue does yours is whatever's in the news you're not going
00:25:42
to create that kind of change you know i do think there are a lot of similarities
00:25:45
between mission-driven startups and political movements you know i wrote a blog post called your startup as a
00:25:50
movement where i basically say that you know good marketing is about evangelism it is has everything in
00:25:57
common with what good political leaders do basically they critique the status quo they tell you what the world likes
00:26:04
looks like today what the problem with that is and where the world needs to get to what the solution is and then how
00:26:10
they're going to deliver that solution so you can i think as the leader of a company be very mission driven you can
00:26:18
bring about that change you want to see in the world you just have to attach a business model to it if you don't have a
00:26:22
business model you're just collecting donations let's build on that brian what is the stated mission today of coinbase
00:26:28
yeah our mission is to increase economic freedom in the world and if for people aren't familiar with
00:26:33
that term economic freedom is kind of an economic term like gdp but it looks at the measures of different countries of
00:26:38
the world and looks at factors like are their property rights enforced how stable is the currency how easy is it to
00:26:44
start a business you know is there corruption in bribery prevalent and things like that and what's really cool
00:26:50
about economic freedom is that basically countries with higher economic freedom um you know like singapore and
00:26:56
the united states and ireland they tend to correlate with all kinds of things we
00:27:00
want in society not just better economic growth but even higher self-reported happiness of citizens better treatment
00:27:06
of the environment better income for the lowest 10 in society gender equality all
00:27:11
that stuff yeah gender equality and then yeah countries with net low economic freedom
00:27:16
you know cuba north korea sudan these are some of the lowest they tend to have you know even things we don't want like
00:27:23
higher corruption higher war higher infant mortality so it's basically when i read the bitcoin white
00:27:29
paper back in 2010 i had this thought eventually that was like maybe cryptocurrency is this unique
00:27:35
moment in history this unique technology that allows us to inject economic freedom into the countries all of the
00:27:40
world especially now that more and more people have a smartphone and we can basically put good financial
00:27:44
infrastructure good property rights you know global trade a stable currency into
00:27:50
200 countries all over the world as one small group relatively small group of people and hopefully it has all these
00:27:55
positive downstream impacts so that's the mission of coinbase when you look at the regulatory environment uh it has
00:28:01
been far from clear what's allowed here in the united states in fact you had a pretty um strong
00:28:09
lee worded tweet storm back in september of 2021 some really sketchy behavior coming
00:28:15
out of the sec race recently story time maybe you could talk a little bit about the sec's approach to cryptocurrency
00:28:23
versus securities xrp comes to mind and knowing your customer you've obviously taken a very conservative
00:28:31
approach to what tokens you uh put on the platform and then you have competitors who are offshore who it's
00:28:37
kind of yolo anything goes um what is the current administration doing right wrong and what needs to happen here in
00:28:45
the u.s to for us to be competitive in crypto while still protecting citizens from
00:28:52
you know being bag holders yeah it's a big question so you know as a startup you're always trying to thread
00:28:58
the needle here you don't want to wait too long for clarity because sometimes these things take five ten
00:29:03
years and so you'll just never launch a product but if you if you're too aggressive you can blow the place up and
00:29:08
so what we always did in the early days of coinbase is we said we want to go do what we think is going
00:29:13
to be required in the future go get licenses go do kyc go go do aml anti-money laundering
00:29:19
and so we tried to basically do the right thing go and talk to these regulators practically now the u.s has
00:29:24
actually been pretty forward thinking on this i'd say every year we get more and
00:29:28
more clarity so coinbase is now a very regulated financial service business you know i can go through the whole list we
00:29:34
have a license from the cftc a federal regulator we acquired some broker dealer licenses which the sec regulates we have
00:29:40
money transformation licenses we're a bit licensed in new york et cetera and that's just in the united states so
00:29:44
we're in many many countries around the world so how do we get more clarity well one
00:29:50
thing i'll just say is it's actually better for there to be lack of clarity than to be clarity that is um punitive
00:29:55
or bad so it's good that there's a little bit of lack of clarity as long as it's not
00:30:00
curtailing the industry but would be even better is to have clarity that does provide that right balance of good
00:30:06
consumer protection you know make sure that there's a fair level playing field for all the players and then it allows
00:30:13
innovation to flourish and so what's good now is that in the us um you know dubai administration put out an
00:30:18
executive order recently kind of asking all the different agencies and departments to come back with a clear
00:30:23
plan and they did recognize the potential innovation in crypto in that in that executive order which i was
00:30:27
really pleasantly surprised to see um so what's happening now is that there was a little bit of jockeying i think
00:30:34
there where the sec said hey these all look like securities to us and i don't think that's quite true you know the
00:30:38
cftc is regulates commodities while some cryptos are going to be commodities i think here's here's what i'm realizing
00:30:45
is that crypto is going to be many different things it's not just going to be one regulator
00:30:49
doing it so you know think about cryptocurrencies like bitcoin that's pretty clearly a commodity or ethereum
00:30:54
right like many of these are ethereum commodities that probably should be regulated by the commodities regular the
00:30:59
cftc now if people want to raise money for their company a security token that should be regulated as a security by the
00:31:05
sec that'd be great to have more clarity on that let's have we would love to keep working with the
00:31:10
sec to make that a well trodden path that any company can go raise money and that's how it would get listed on an
00:31:15
exchange like ours and we could register as a broker-dealer or whatever license is needed
00:31:20
um separately there's also some cryptocurrencies that are going to be currencies like stable coins and you
00:31:25
know maybe the treasury should regulate those and finally there's going to be cryptocurrencies that are none of the
00:31:30
above they're artwork or something that's probably shouldn't even be regulated and so
00:31:35
the us with various financial you know international bodies like g20 and fatiff and all these imf are probably going to
00:31:43
put some policy papers together we're going to eventually end up with some kind of a test that says is this
00:31:48
cryptocurrency a commodity a security a currency or something else like artwork and then maybe
00:31:54
maybe five more things we haven't even thought of that it'll end up being in the future what would you make the test
00:31:59
for this is a utility token versus specul speculative uh security because that seems to be the
00:32:06
one that's really hard for people to figure out if 99 of people are buying a token
00:32:13
on coinbase because they want to see it appreciate and they want to see it gain value and only one percent are using it
00:32:19
for the actual utility of it is it then a security is it by the percentage of people who use it
00:32:25
how how would you as the the you know the leader in this industry you know uh actually define it what's your
00:32:32
definition yeah so i think look i i don't want to be presumptuous here i think that we can
00:32:37
we can put some policy papers together but i don't want to be you know it's the policy makers job to come up with the
00:32:43
policy so i don't want to step on anyone's toes but that being said i think there's some existing case law out
00:32:47
there like you know the howie test is something from a long time ago we could probably build upon that so the howie
00:32:52
test kind of says you know is this an investment in a common enterprise with an expectation of profit and that would
00:32:58
make it that would make it a security so there's a lot of pieces to that you know
00:33:01
is it an investment well if you're just giving the tokens away i guess people aren't investing right is it a common
00:33:06
enterprise well maybe if it's decentralized and you don't actually control this entity like um you own you
00:33:11
know less than a majority share or something maybe then that's not a security right or if there's not an
00:33:15
expectation of profit people are using it for something so every startup right now in the space has basically had to
00:33:20
hire a bunch of expensive lawyers to go tease apart these old old rules that some of them were created in like the
00:33:25
1930s you know before the internet and everything and try to understand where they're falling and so i think building
00:33:32
upon that howie test but it could be something that includes a commodities definition something or currency
00:33:37
definition you know i think we should basically it's on us and the other crypto companies out there to go hire a really
00:33:44
smart lawyer who has drafted legislation before and a bill and actually get a draft of it out there and then we can
00:33:50
start to circulate it with various policy makers and get their feedback and maybe they take it and run with it maybe
00:33:54
they say thanks we have it we've got it from here but that's our next step freedberg saks jamath would you go with
00:34:00
the howie test um or do you have thoughts on how to how the government here in the u.s should say this is a
00:34:06
security this is a utility token i think what the eo did was basically kind of give people enough
00:34:16
regulatory safety in the sense that something reasonable will probably happen in the
00:34:22
reasonable future so that people could keep building and iterating my big takeaway in the last sort of like nine
00:34:28
months is that this thing is now too big to fail and the government basically has
00:34:32
to just find a reasonable framework to enable something because the alt the the real big issue jason would be if they
00:34:38
did something crazy and now you know retail would just get completely smoked because i think they are the what do you
00:34:43
think is reasonable i think congress has to basically pass a sensible set of legislations that clearly demarcate
00:34:48
exactly what brian said this realm of stuff goes to the cftc this realm of stuff goes to the sec now you guys go
00:34:55
and implement and if left to their own devices those two will use these arcane laws and try to negotiate amongst each
00:35:00
other who should be covering what but they can't arbitrate that decision and so as a result nothing will nothing
00:35:05
reasonable will happen um so i think that's what has to happen congress has to get together and write
00:35:10
something reasonable freedom you are building companies at the production board every year you build a couple of
00:35:15
companies you have to go through securities law you have to you know raise money from accredited
00:35:20
investors you do it in the traditional way but you must be looking at crypto saying
00:35:25
well i could launch conor munich whatever project and have a token associated with it and raise money and
00:35:30
raise it globally or start a dow what do you think is a reasonable way for people like yourself who are
00:35:38
playing by the existing rules to be able to embrace this new technology and these
00:35:43
new platforms and paradigms i think how should the government handle it well some perspectives important which is you
00:35:50
know go back to kind of the 1920s in the united states and there were pre-1920s folks would go around and tell tall
00:35:59
tales about interesting business ideas or business concepts or things that they were going to do with if they got a
00:36:05
bunch of money from investors and investors gave them money and they didn't actually deliver on what
00:36:09
they said they were going to do and they got swindled and there was swindle story
00:36:12
after swindle story that you can read about and we saw this even with the ico craze of a few years ago right where
00:36:19
people tell a tall tale you expect some value or some asset that you're kind of putting
00:36:23
capital into that will pay off over time and there's a swindle behind it and that's really the origin of securities
00:36:30
laws in large part is to protect the individual from being swindled to protect the storyteller that can take
00:36:36
money away from people and figure out how to kind of rip them off and create a set of laws that the
00:36:42
government can then enforce through the risk of imprisonment against doing those
00:36:47
things the challenge becomes when there's this more thoughtful way of running capital
00:36:53
markets on the other side and how do we actually resolve to some medium ground here i'm not sure that you're gonna have
00:36:59
as quick of a resolution to say well let's go back to the old way where anyone can say anything to anyone they
00:37:04
want and anyone can put money into any project that they want because the role of the arbiter is to protect those from
00:37:11
being taken advantage of if 85 percent of those projects are great and 85 percent of the investors are intelligent
00:37:16
to know what they're doing it's the 15 it doesn't matter it's the 15 that the government is here to protect
00:37:22
and that's the reason we have an institution called the government is to create systems of protection for those
00:37:29
who are otherwise unable to protect themselves now a free market libertarian might say
00:37:34
we should have at it but the problem is we all have them we all feel as a group at some point
00:37:40
a moral obligation to protect those who are unprotected and that's why these systems emerge over time and that's why
00:37:46
these institutions exist that's why the government exists and it's why these securities laws exist and so it's
00:37:52
difficult to assume that we can just go back to the kind of you know um uh prototypical days of you
00:37:59
know let me raise money for anything with any story without any regulation and assume that it's going to work out
00:38:04
well because all it's going to take is a few of these stories before you have folks standing up in congress saying
00:38:09
this is unbelievable we can't let this happen anymore let's go shut down the miners let's go shut down the data
00:38:14
centers let's go after every asset we can and by the way they will because look at what just happened with russia
00:38:19
the way that governments can kind of coalesce around digital systems now and make significant change and block things
00:38:25
from happening i don't know if there is a world where we can assume that even with a free and open internet that these
00:38:31
systems can truly be decentralized given the reach that governments have and it is going to be in my mind i've said this
00:38:37
in the past kind of the great tension of the 21st century socially is the decentralized systems that really want
00:38:43
to challenge what we believe to be a lot of overreach that's happening by governments against the government's
00:38:49
believed role to be protecting those who are who need the protection and so i don't know that's a very long-winded
00:38:54
moral statement well i mean i think it's a very interesting one brian what do you
00:38:58
what do you think of this i get it these are complicated issues right we want to
00:39:01
balance protecting people but we also want to not have the government be in a position where it's picking winners and
00:39:07
losers and so you know you just because something is legal doesn't make it make it a good
00:39:13
investment i guess you know you could have you could have owned netflix last week or something like that and
00:39:18
you guys might talk about that in a minute but look i think we all want to get rid of
00:39:22
fraud right so if you commit fraud meaning you lied to investors then that should be a crime right like
00:39:30
we i want to i want to work with anybody in government to go put that make that stuff not happen the danger is if we
00:39:35
ever get into a place where we say well only wealthy people can now invest because somehow there's an accredited
00:39:40
investor test that's inherently exclusionary i don't i don't like the accredited investor laws
00:39:44
if we ever get into a place where the government is saying you know well you have to
00:39:48
you have to have xyz criteria and a person with this many years of experience on their resume and then now
00:39:52
we get into like the government sort of designed by committee to pick winners and losers and that's that's inherently
00:39:57
flawed because you know a lot of true breakthrough innovation they look like bad ideas at the beginning they're
00:40:03
the kind of things that a government body would never invest in or put money into right so
00:40:08
that's the inherent tension we have to worry about we're protecting people but not putting the government in the role
00:40:13
of picking winners and losers sacks you have any uh input on this sort of framework you are
00:40:18
investing traditionally in stocks but you have also um allocated some money to multi-coin capital and other folks who
00:40:24
are buying tokens and then you have to distribute them and you have to deal with these downstream legal issues how
00:40:29
are you dealing with them and then what do you think is a proper framework here in the u.s for protecting consumers
00:40:35
while allowing innovation i think the big picture framework that we have is correct which is you kind of have this
00:40:40
dichotomy between security tokens and utility tokens so security tokens basically it's a token that's issued
00:40:47
that it's basically like a share of stock or a fractional ownership in some business doesn't really have a
00:40:54
lot of functionality associated with it that's kind of an end run around the securities laws they should be treated
00:40:59
like securities on the other hand though there are a lot of tokens that are issued as part of creating a new kind of
00:41:07
technology network and those tokens have real functionality and if you were to subject them to
00:41:13
securities laws and impose kyc and accreditation you have to go through all these oops just to add one to your
00:41:18
wallet it would destroy the potential functionality created by these systems so where there's real utility like that
00:41:24
i think the government should foster innovation by having a lighter hand don't subject them to
00:41:30
securities laws and really what entrepreneurs need in the space are some safe harbors some really clear lines
00:41:36
around what would trip them up and and have them cross over from utility token and security token so they
00:41:44
know to avoid those things so they can continue innovating on their core project
00:41:48
i think that's well said i i have uh three ideas brian i want to run by you number one
00:41:53
a sophisticated test for investors in crypto and in startups so just like you get a gun test or you know you test for
00:42:00
a driver's license we come up with a way for people to become sophisticated they
00:42:04
take a simple test maybe it's a you know whatever number of questions and then second
00:42:09
maybe some safe harbors around the scale of a project so any crypto project under
00:42:13
10 million can be an experiment and you know it's kind of like no need to have rules people just have
00:42:19
to sign a disclaimer a waiver this is an experiment then things may be between 10
00:42:23
and 100 million you implement kyc and maybe throttle the numbers those are some good ideas for when
00:42:30
you're talking about the bucket of security tokens if you want to start imposing those kinds of rules on utility
00:42:35
tokens you can't have a functioning network with like all these sort of friction well hold on but if then if the
00:42:42
project gets scale then you just have to file a little more have a little more kyc and then finally the founders of
00:42:49
these projects they can just launch them and disappear they have no director-like duty to the project do you
00:42:57
think there needs to be something similar to directors in corporations so just three ideas there that i've heard
00:43:04
other people talk about or i've been thinking about right those are pretty good i like those actually i mean the
00:43:09
nice thing about a driver's license test for financial literacy is that it doesn't measure how much money you have
00:43:14
so it would allow smart you know aspiring people who didn't start a lot of money
00:43:20
um like a lot of us to also be able to participate early on in these which would be really great um yeah i think
00:43:26
it's you know some kind of a safe harbor or sandbox provision i think is is a really great idea as well and lastly
00:43:31
yeah i mean if you were able to um basically i think your three ideas are great so those are good i think that
00:43:38
they're good for securities but i mean should if you just want to buy gas on a blockchain to run your program
00:43:44
or you're a user of a application that's being run on a blockchain you just want
00:43:48
to buy a token for gas do you really have to go through all these like kyc type hoops hopefully not especially if
00:43:54
it's if it's a utility i mean self-custodial wallets and dapps or decentralized apps are this huge area of
00:43:59
innovation that you know you wouldn't want to like imagine if the us government had said
00:44:02
you need to come in and register to make a website or something like that that would have been a terrible thing for
00:44:07
innovation globally so and you have to remember too that a lot of this is going to flow to the
00:44:11
country with the most permissive laws so a lot of governments around the world not the most permissive but the most
00:44:17
well structured that balances all that all the pros may be clear yeah the thing that i would just add to this
00:44:23
though is that there's a lot more than just aml and kyc guys that has to happen for this to be a functioning ecosystem
00:44:31
we average i think one hack a week in the crypto ecosystem right this bean stock happened like just a few days ago
00:44:38
that was almost 200 million dollars last month axe infinity what was that almost
00:44:42
600 million dollars so there's a lot of stuff where in the in the normal securities world like if you're
00:44:50
a director of a company and you don't have these adequate procedures and brian you live this every day where there's
00:44:55
like an audit committee and there's somebody that shares audit that has to go and think about information security
00:45:01
and blah blah and all these disclosures have to happen insurance but all these disclosures are really about actual work
00:45:07
being done if you don't do that work and then you get hacked you're actually liable right
00:45:12
there's no version of this in a world where it is a little bit of the wild west so that stuff also has to exist
00:45:16
this is what i what i mean by i actually think congress just needs to kind of like update the set of
00:45:22
laws that actually allow the cftc and the sec to do their job to include this and say now go and incrementally figure
00:45:28
this out because even if you get the aml and kyc stuff right then there's all this other
00:45:33
stuff where you know these folks that had they're basically you know all this all this value deprived
00:45:39
who do they go to to try to get the money back you know in in the case of axi i mean
00:45:44
this is it's an incredible thing but like you know they went to andreessen and they raised a new round they're like
00:45:48
we're just going to make everybody whole but that's insane right that's like not
00:45:51
you can't expect that to happen with every single project every single company it's not going to be possible
00:45:57
yeah well i think a couple things will happen i mean in the s in the custodial world
00:46:01
of crypto there'll be more regulation there already is right like we we have a new york trust company that we get
00:46:05
audited for various um control environments and safety and things like that but in the self-custodial world
00:46:11
everyone is going to start to be in control of their own assets and i think that you know the tools are
00:46:17
getting better and better for that like you know social recovery of keys if you if you forget your password and these
00:46:22
kind of smart contract wallets and so you know both are growing um and i think in the future people may actually start
00:46:29
to take more responsibilities for storing their own wealth if they want to choose to do that and that'll allow them
00:46:33
to kind of access a broader ecosystem of things let me ask a question brian uh everybody seems to be very concerned
00:46:41
about tether you i don't believe participate in the tether ecosystem at coinbase is that
00:46:47
correct uh well we're not participating directly but we support as many assets as people
00:46:52
want to use and that is one of the ones that we've supported people to deposit and withdraw in coinbase
00:46:57
they've been um banned in new york they've had uh regulatory action in canada uh people
00:47:05
are concerned about their attestations or lack of clarity on their commercial paper
00:47:11
what do you think of these stable coins getting very big and maybe usdc seems to have it pretty
00:47:18
tightly covered but there's all these concerns and regulatory actions against tether is
00:47:22
that a big nothing burger or does it concern you that there's a lack of transparency into their holdings
00:47:30
yeah so i would say you know some of the early stable coin efforts definitely didn't have all their ducks in a row
00:47:36
from a reputational point of view you know i'm not i'm not an expert on tether my understanding is that there
00:47:42
have been some investigations and enforcement actions which have required them to go in there and clean up some
00:47:47
things and um you know our our digital asset listing group kind of looked at a lot of this in depth and
00:47:52
made that judgment called that where they where they were and where they are now
00:47:57
but yeah i do think that we're seeing the emergence of new groups like you know usd coin is one of those that i
00:48:03
think has some better controls around it and there's actually a bunch of um stable coins now that are decentralized
00:48:10
you know die and fracks explain what that is and why it's important well so okay so it really comes down to
00:48:17
trust i mean you know you can trust uh you can decide to trust something like usdc that has
00:48:22
kind of audit requirements and you know a big four accounting firm come in and look at it and things like that
00:48:28
or you can look at smart contract code and you know thousands of people around the world can
00:48:32
look at that and there's an inherent bug bounty if you find an issue there and if
00:48:35
it hasn't been found then you can start to think about trusting that now i think
00:48:40
stable coins like like dye and others they've been able to create these um relatively complex systems that have
00:48:46
sort of um that one asset which is intended to be stable but another one which is sort of the collateral and you
00:48:52
could imagine various black swan events where you know the peg would get broken and things like that but it really
00:48:56
hasn't happened yet in die and it's shown a lot of resiliency which i've been very impressed by there's one
00:49:02
actually one other um type of coin which i think is even maybe more interesting than just wrapping a fiat uh
00:49:09
like a dollar or a rupee or something like that because frankly you know the dollar is seeing a lot of inflation you
00:49:14
guys have talked about it many times on this show so do you really want to have a stable quote stable coin that is
00:49:19
inflating you know eight percent a year exactly there's there's some new coins coming out which i've been really
00:49:24
excited to see which are i think you know biology calls them flat coins but they're basically looking at the
00:49:29
consumer price index and they're trying to basically have flat purchasing power and
00:49:35
assume that the dollar and various fiat currencies around the world are actually
00:49:38
going to go through more inflation that's a pretty cool idea and you can do that in a creative way on a blockchain
00:49:42
by having various oracles which are these sources of truth and if enough of them you know 51 of them tell you the
00:49:48
cpi we think is this this year it can kind of keep keep pace with cpi which is a really cool innovation i think thank
00:49:54
you so much for brian armstrong for joining us for the first hour and now we'll continue on with our netflix
00:49:58
discussion brian's fantastic he was very honest he answered a lot of questions very honestly and he's a super fan of
00:50:04
the show that business is a great business that business would be a great business he's thoughtful we like
00:50:09
somebody who's thoughtful i really think that the challenge that brian faced a year and a half ago and the policy
00:50:13
decision he faced is now being faced by every ceo across america and that's the broad relevance is you know what are
00:50:20
they going to do do you see this this quote by the mcdonald's ceo the former mcdonald's ceo ed regency on wednesday
00:50:26
said companies have no business being in politics and has launched a new advocacy
00:50:31
coalition to fight woke corporate politics he said corporations have no business
00:50:36
being on the right or the left because they represent everybody there and their sole job is to build equity for their
00:50:43
investors wait the people who make fileto fish are not gonna chime in on ukraine anymore
00:50:48
yeah but but think about that because that actually is a pretty radical it is a line in this end yeah he's
00:50:54
standing on brian's shoulders let's be honest i think you know the ceo of mcdonald's i
00:50:59
mean that's like a big you know traditional fortune 500 type corporation and they're saying like we're not doing
00:51:04
this anymore well you know what they were more than willing to do it if it scored them points what they realized
00:51:09
was it's going to be a never once you engage that you're never going to be able to disengage from it all right
00:51:14
let's pivot over to uh netflix they reported a drop in net subscribers for the first time in 10 years uh and the
00:51:20
stock dropped 35 market cap from 155 billion to about 98 billion according to bloomberg
00:51:29
as of wednesday netflix was the worst performing s p 500 so far in 2022 stock down 63
00:51:37
year-to-date ackman uh dumped his entire stake and booked a 430 million dollar loss and a large part of this was
00:51:47
because they didn't hit their 2.5 million or so uh target uh increase in subscribers and they in fact
00:51:54
lost all seven hundred thousand russian subscribers as part of uh boycotting um uh russia because of
00:52:02
the ukraine war what do we think is happening here is this a bellwether chamoth for something
00:52:11
more important going on or is this just netflix not executing well i think there are there's a macro
00:52:20
thing and then there's a netflix specific thing the macro thing is that we are learning the broad sweeping
00:52:27
impact of apple's privacy changes in my opinion you first saw it flow through into
00:52:33
facebook's earnings and basically them saying this is going to be really tough and you had netflix even if you add back
00:52:39
the russian subscribers basically spend almost 600 million dollars in the quarter on customer acquisition to
00:52:45
effectively they would have generated 500 000 subscribers net of churn right which was still about a million and a
00:52:50
half under where they needed to be so the point is that i think netflix in some ways was a
00:52:55
little bit of a canary in the coal mine for the the shrinking um effectiveness of online advertising and
00:53:05
i think that's why you then saw two days later facebook got taken to the woodshed in
00:53:10
two days was down you know now it's down i don't know 15 20 percent google i think has been down a lot today it's
00:53:16
just getting absolutely smoked relative to the market so that's the macro issue which is i think
00:53:22
um it's really hard for these ads to be as effective as they used to be and it's
00:53:27
only going to get worse because google has also said that they're going to implement a lot of the same versions of
00:53:31
what apple did inside of android so customer acquisition is going up so if you look at then all the companies that
00:53:36
have to live and die on cac it's going to be an expensive road that's the macro thing i
00:53:43
think that not enough people are talking about i think the micro thing inside of
00:53:47
netflix is that you know people churn out of a service when there isn't enough value
00:53:54
and i think that's the most basic explanation of why so many people are leaving netflix is that it's not that
00:54:01
valuable so when you're spending 20 billion dollars a year on content but people more than ever are leaving
00:54:07
the service you have to inspect how much are you really spending in these areas and what is it actually creating in
00:54:12
terms of like library value you know disney plus i think has gotten has done an incredible job in a much shorter period
00:54:21
of time apple after only a few years wins the first oscar of any of the streamers
00:54:27
right beating netflix even though they've been in there and spent a picture for best professed picture but
00:54:31
i'm saying yeah so when you put all these things together uh i think netflix probably has lost a little bit of the
00:54:36
script but they're also suffering from a really macro headwind which is the advertising business is broken
00:54:41
i would imagine that like total subscribers to streaming services and if you were to add up total subscription
00:54:48
service dollars it's probably growing a lot oh for sure netflix's relative share
00:54:53
is going down because the quality of the competitors is improving so much even companies that are not able to
00:55:00
deliver like cnn shut down cnn plus this week after investing 300 million dollars in
00:55:05
trying to build out the service i mean folks are putting serious dollars behind these projects
00:55:10
um and so the competition is fierce and they've got deep content libraries behind them i personally think hbo max
00:55:16
is the best streaming service now awesome followed by disney plus followed by maybe a mix of amazon netflix and
00:55:24
um you know uh prime and so like netflix's relative value is going down because there's so much other content when i'm
00:55:32
kind of thinking about what to watch i'm looking at disney plus i'm looking at hbo max and i'm like hey you know what
00:55:38
should i watch tonight and then i look at netflix netflix doesn't have a monopoly in content anymore and so when
00:55:44
i've got limited dollars i personally looked at this after we were texting about it i subscribed to
00:55:49
seven streaming services right now and if i didn't care as much about how much i was spending per month i would
00:55:55
probably cut three of them and netflix yeah you're you're also then highlighting the second i think macro
00:56:01
thing that is actually equally important maybe even more important which is you know the the first rule of
00:56:07
capitalism says that excess returns will always get competed away so you know netflix had the run of the place where
00:56:14
they were an effective monopoly totally and now when everybody else woke up and got religion they decided to invest and
00:56:20
they've created some really compelling content and so all of those returns will now get spread across seven or eight or
00:56:26
nine competitors which means that just by definition mathematically netflix can't win the way that they used to and
00:56:32
the network advantage in the streaming model is content and consumers so you have better content you get more
00:56:38
consumers you spend you get more money from consumers you spend more on content at some point you get diminishing
00:56:43
returns in that network model and now we're seeing those diminishing returns hit netflix they haven't built
00:56:48
advantages in search and discovery or in other words social sharing or other features into the app or into the
00:56:54
service that will give them more of a lock-in value because all i'm doing is buying con is watching they're also
00:56:59
three times elsewhere they're also three times the price of disney plus and other services
00:57:04
so they're in the competition space people are starting to look at and go is this worth
00:57:08
you know a disney and an nbc or is this worth a hulu and an nbc uh streaming service sax you had some
00:57:16
dad well i mean i agree with that i would just add one factor to this which is what elon said which is he said the
00:57:22
woke mind virus is making netflix unwatchable i mean the quality of the programming has gone down i mean netflix
00:57:28
used to be really good i can't think of like a show now that i watch on netflix and i do watch hbo max right now and
00:57:37
disney plus because they got some shows that i like so i think somehow the programming
00:57:42
people on netflix have gotten out of touch yeah are they pandering to that audience
00:57:47
sax do you think and you know similar to kind of how disney ended up pandering and do you think that there's broadly
00:57:51
this kind of media problem of trying to pander to the wrong audience i mean they almost threw
00:57:56
chappelle off who's the number by far the number one comic in you know in american comedy and they absolutely
00:58:02
would have thrown chappelle off and done what a lot of those employees wanted if
00:58:07
they didn't have such a big deal with him if he wasn't such a big deal no i think they held the line pretty
00:58:11
pretty there's a lot of groveling there's a lot of government i think they've reasonably heard the
00:58:16
concerns of their employees and said we reasonably disagree can i ask you guys look yes maybe but what i'm saying is
00:58:27
that that episode revealed that the people are doing the programming in netflix obviously
00:58:33
are like they're not like i think they've lost touch with where most of the country is i will give
00:58:38
a shout out i have not watched a series on netflix in probably a year ozark no no no but i will give a shout out to
00:58:46
never have i ever which mindy kaling created she's amazing and that series is incredibly funny and poignant and cool
00:58:54
and awesome but outside of that series i cannot think of a single reason why i would actually pay for netflix let me
00:59:01
ask you guys a question so going back to because you know there was the whole disney panda hbo max however oh my god
00:59:07
so good the whole industry is suffering this problem do you remember this we don't even watch it anymore this is
00:59:12
the question i have for you do you guys think that there's a difference culturally
00:59:17
in the management of the media company so let's go through them warner media disney
00:59:23
netflix amazon and do you think that that cultural difference may create an advantage and
00:59:29
success do you think that warner media is operating hbo max differently because they're culturally different yeah
00:59:35
because they're culturally different culturally different they have no and for or tours hbo has always
00:59:42
sucked for years they got a few good shows now it's it's more like they've always been for tours they always have
00:59:48
gone of the director the vision of the writer and taking a lot of risk when you hear
00:59:53
that hbo logo i agree they have some really good shows right now but until the last couple of
01:00:01
years it was like pretty dismal business but i mean i too freebrook's point you know that netflix
01:00:06
i would say i would say disney has marvel and that's why they have marvel and star wars and that's and that's kept
01:00:12
them extremely relevant and the advantage disney has is the uh re-watchability of their content i don't
01:00:23
know how many times your kids have all watched moana my kids have watched i've had to watch moana 107 times already
01:00:29
let's hear it let's start yeah and and you're welcome yeah you're welcome and the um and the star wars content as you
01:00:37
guys know you could re-watch star wars and marvel i mean like the the content is very different right pixar movies too
01:00:43
you can watch 100 times over that's very different content hbo max is thrilling and engaging and doesn't feel like it's
01:00:50
pandering hbo right now is operating at the next level i mean so many good shows
01:00:54
it for me but netflix was five years ago so i understand but we're not talking about the past we're talking about here
01:00:59
today netflix went with these very big deals with big celebrity names and you know i think they just lost their
01:01:07
uniqueness in terms of taking so they went with adam sandler no offense to adam sandler fans
01:01:13
and they're doing a lot of reality tv now and if you look at hulu like dopesick and then the dropout if you
01:01:20
look at apple tv ted lasso we crashed uh and then you look at hbo max with just uh you know euphoria by the way yeah
01:01:28
even even i like i can actually can you imagine euphoria is it on netflix it would never be on
01:01:33
netflix it would never get made it would never get made on netflix they don't want to take risk hbo is like
01:01:38
for adults it's paid and they're going to take risk and disney doesn't can't touch that i think hulu is a sleeper i
01:01:44
mean hulu's great have you guys watched the series called the great on hulu no it's about catherine the
01:01:50
great it is incredible i can't believe my videos i can't i can't open my subscription so i'm watching severance
01:01:57
right now that's amazing it's like really like you know by the way i started paying for youtube tv so that i
01:02:02
could get streaming cable oh yeah that's my number one my number one watch thing it's youtube tv because i don't
01:02:09
know do you have youtube without ads yeah you i do youtube right now it's such a great way how do you do that
01:02:15
right youtube red or premium youtube premium it's cool it's nine bucks a month tomorrow you can afford it
01:02:20
you see no ads on youtube ask your assistant to ask her assistant to sign you up and and you won't have to watch
01:02:26
ads on youtube are you functionally not able to use the internet now i actually have people that do it for me
01:02:33
do they type in your email password for you yes yes you're like how does this work and
01:02:37
they're like there's a person right there netflix if i can't get the mouse to work he's
01:02:43
got the vp of product from questron who lives in a little shack in the house next door who comes over and uses the
01:02:48
remote for him yeah thanks for tuning in everybody for the dictator himself the sultan of science and david sachs we
01:02:56
have a jam-packed agenda my god the summit is going to be amazing let's just do a little recap here of
01:03:02
what's happening um we've got some pretty great speakers ryan peterson nate silver uh claire
01:03:08
vickel uh brad gerstner uh palmer lucky's coming elon's coming keith reboy's coming joe lonsdale tim
01:03:16
urban wait do you see elon's coming oh is that what it says on the website yeah he's on the website now elon musk
01:03:22
he's coming nice of paypal uh antonio gracias i mean we've got uh just an all-star
01:03:28
uh kind of very bullied there and i think uh glenn greenwald and matt tybee are coming yeah that's gonna be amazing
01:03:34
and so it's gonna be really great all right everybody uh we'll see you next time on the all-in podcast bye-bye
01:03:42
[Music] and they've just gone crazy with them [Music] besties [Music] your feet we need to get mercy's
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