00:00:00
oh Jake house here hello Jacob hey how are you thanks for showing up I've been here the whole time I was just uh well I
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was just having some of these beautiful salted roasted pistachios the only problem is when I
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went to the store I kid you not there was a shelf of these all flavors available except one flavor
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salt and vinegar sea salted Tire we move the market we moved the market I am not
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kidding I go to the fancy you know bespoke the rallies and Truckee I went to the
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railways and Truckee the artisanal and they have you know all these over first of all it's called artisanal that's what
00:00:37
I said the art stuff the artistic food the artesanal
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bro where they had this I kid you not spicy salty no salt every
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shelf packed then there's one shelf I can see straight through to the ice cream but not see southern and I look at
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the tiny little sign salt and vinegar shelled nuts sea salt sea salt and vinegar tomato shelled nuts
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sold out across the country you know I cannot recommend these more highly they're incredible you can't recommend
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yourself they are delicious my salty nuts are delicious
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to let your winners ride Rain Man David's side
00:01:23
we open source it to the fans and they've just gone crazy [Music]
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did you see Joe manchin's High heater op-ed in the Wall Street Journal oh oh my God
00:01:37
yep Joe manchin went for it but Joe manchin's running for president he is I think okay so let me ask sax right there
00:01:43
sex Joe manchin Nikki Halley and who's the guy from Florida what's
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your question by the way there's a big defection that was leaked this week Ron louder flipped from Trump to to
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santis that's a big one because louder is good for a lot of money five to ten million at least Joe manchin what impact would he
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have coming to the race I'm not trolling him looking for your honest opinion well it depends how he comes in what did he say in the op-ed he was talking about
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the insincerity of the Biden Administration to control costs and how everybody was incompetent and it certainly there's some waste and we can
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control some spending and everybody needs to grow up and get in a room and just manage the budget for the American
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people and stop playing politics yeah I think the headline of the article actually to your point Jacob was much worse than the substance of the article
00:02:25
sax but if you see the headline I don't know Nick if you can just throw it up there it was brutal the headline in the byline of the
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article I think was more damaging than the substance of the article Biden's inflation reduction act betrayal
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instead of implementing the law as intended his administration subverts it for ideological ideological and I have
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to think that Joe was responsible for that for the titling of that article you know he would get permission to approve
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it right and by the way I think if you guys remember we talked about this when that
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act was first published and if you guys remember I think I pulled up the CBO data the CBO model and it showed for the
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first five years this thing Burns a couple hundred billion dollars and then there's some expectation that there'll be some sudden boom in Revenue in the
00:03:08
out years and then you make the money back in the out years so it's total like accounting Shenanigans for him to have
00:03:14
made the claim in the first place that the IRA was actually going to be like a net deficit reduction or debt reduction
00:03:19
in fact it's all just accounting Shenanigans and it's just a massive spend package particularly in the near term when it
00:03:26
matters most I think I told you guys this but I think this was like when was the last time I was in Washington probably what is it March now so maybe
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it was January I was there and I saw Schumer and Mark Warner and I
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spent about two hours with mansion he is really impressive
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he's cool he's interesting he's thoughtful he's moderate
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mansion's like a formidable guy so this will be really interesting if he steps in there and tries between Nikki Haley
00:03:57
and Mansion where do you uh write your check I'd probably write a check to both to be honest feels like a good ticket to me I've always wanted to see the the
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cross could you imagine a Democrat and Republican merging somehow and like running it would be the greatest my god
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I've been pitching that for years I think that's like a my God clear path David Friedberg may have just come up
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with one of the most disruptive ideas in American politics that's ever been floated
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Mansion Hallie Hallie Manchester imagine Helen yeah just uh my comment on this so first of all I remember when you know
00:04:27
Mansion did a good job stopping Biden's three and a half trillion dollar build back bet I remember it was him and Cinema that were the holdouts yep but
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then Mansion compromised and gave Biden a 750 billion dollar version of it and I
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guess now he's complaining that Biden didn't live up to his end of the bargain and doing the deficit reduction but quite frankly many commentators said at
00:04:48
the time that the bills claims deficit reduction were Preposterous and that would never happen so quite frankly you
00:04:55
know Mansion shouldn't have been euchreed or Hoodwinked by Biden everyone was basically saying there'll never be any deficit reduction out of this bill
00:05:01
it's just more spending so I don't really feel bad for Mansion here saying that somehow he was betrayed by Biden he
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should have known better now in terms of him running yeah I think as a Democrat
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who's figured out how to get himself elected in West Virginia which is a plus 20 Red State he obviously knows how to
00:05:19
appeal to the center the problem for him is just how do you get the Democratic party nomination because he's far to the
00:05:26
right of your average Democratic Party voter if he wants to run as an independent that's a different story and
00:05:31
that would really throw a curveball into the race but I don't see him doing that I think it's kind of a stretch and this
00:05:38
is the problem with a lot of these fantasy candidates is that you know centrists or moderate voters might like
00:05:44
them but they can't get the nomination of their party unless you mean like Trump and Obama those who are fantasy candidates I don't think so I mean Trump
00:05:50
was not a fantasy candidate he's the ultimate well he was an outsider but he appealed to the base of the party he appealed to the base of the party what
00:05:56
I'm saying is in order to get the nomination of a major party who have to appeal to its base and I don't think
00:06:02
Mansion appear the base Democratic party he's out of step with it he's out of step with it in ways that I like don't
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get me wrong but I just I don't see how he's going to get a nomination Chris Christie what do you think of him he
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seems like he's about to come in the race too David he's just clutter okay pointless all
00:06:22
right listen everybody Welcome to the all-in podcast it's like episode 100 something with me again today the Rain
00:06:27
Man himself yeah David sacks is here Friedberg is in his garden at his home
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in Paris spring has sprung the queen of quinoa and of course the dictator
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himself chamoth palihapatia The Silver Fox look at that little tough of silver hair so distinguished I got a haircut
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from somebody recently who said that people go to her and ask her to put the
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silver thing in their hair really I don't have to worry about that yeah it
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looks like he's in Smurf Village there what is what is that backdrop background that is a a scene from
00:07:07
oh okay I like uh most of my backgrounds oh my God what's the mood in the moment of the week you guys just totally
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totally denied half the beta males in the YouTube comments from being able to guess what the background yeah thanks a
00:07:21
lot I really did for them reverse image search and then I use the chat
00:07:26
to automatically figure out the background each week oh okay all right
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well let's get started come on let's get started okay listen I gotta get out of here again yeah
00:07:38
it feels like he's in a good mood I like this welcome to the world's greatest podcast
00:07:44
opening I launched a bunch of chat GPT plugins and I don't know if you saw it but David
00:07:52
sacks wrote a blog post with chat GPT it's an amazing back and forth I read this back and forth explain what
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you did sax this was really like one of the best conversations I've seen with chat GPT
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they'll pop it up here on the screen but you did well I had an idea for a blog post about the use of a I guess tactic
00:08:14
you could call gift to get I thought it would be a interesting tactic for AI startups to use if they're trying to get
00:08:21
a hold of proprietary training data so for example if you wanted to create an architect AI you need a lot of plans or
00:08:29
if you're going to create like a doctor AI you need a lot of lab results or medical reports to train the AI on and
00:08:36
those are hard to get open AI doesn't necessarily have them yet so there is an opportunity I think for startups to
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create these AIS and different you call them professional verticals so the gift to
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get technique would be you give points to your users for uploading that data and then they can spend those points by
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using the AI and anyway the the company that came up with this gift to get tactic was a company called jigsaw
00:09:00
almost 20 years ago no one remembers this company I'm kind of dating myself because I remembered it but I just had
00:09:06
this idea gee I wonder if the jigsaw approach could be used for AI startups so I started by going into chat GPT and
00:09:13
I said hey have you heard of Jigsaw and then it had and then I said tell me about its gift to get you know approach
00:09:20
and then I said would this approach work for hey I sort of set one proprietary
00:09:26
training data sets and I said yes this is a good idea and then I gave the architect example and I said can you
00:09:32
give me more examples like this and it gave me like 20 more examples and then I asked it just to flesh out
00:09:38
various kinds of details I went down some cul-de-sacs I didn't use and then at the end I said can you summarize
00:09:43
everything we've just talked about in a blog post and it gave me the first draft of a blog post I then did a substantial amount of
00:09:50
editing on most of the blog posts although some of it I just use verbatim and then I had a couple of people in my
00:09:55
firm look at it they made some good suggestions so it's not like the human's completely out of the loop and then I
00:10:00
copy and pasted my edited version back into chat GPT said here's my edit and then I asked for some suggestions it
00:10:07
made a few small edits and I said okay great just incorporate the edits yourself gave me that final output and
00:10:13
then I posted on sub stack a Blog that probably would have taken me a week to research
00:10:18
and write if I had done it at all I was able to do in a day and I can't see myself going back now I
00:10:25
think this is just how I'm going to write all my blog posts is is use chat GPT as my researcher as a
00:10:33
writing partner some cases an editor but I'm definitely going to run it through the thing that I was struck by was
00:10:40
just how kind and generous and thoughtful this conversation was and I just thought I've never seen sax have a
00:10:47
conversation where he was so kind to the other person and thoughtful right about now all your friends and family are like how do we get sex to have this
00:10:53
conversation with us you were super kind to the AI because it's not a person it was a robot oh yeah well just in case it
00:11:01
takes over the world Jay cow you can't be too too careful but no I think listen it's important to give the AI he's so
00:11:07
cool I've never once gotten a thanks from
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Savage exclamation part scroll up and show that example the AI actually gave me some
00:11:18
information about jigsaw's point system again the the rewards that they used yeah and it was just in text so I said
00:11:25
down below hey can you spit that out as a table and it did instantly that's like a day's work right like you would have
00:11:31
to have an analyst or research and do a days where it's incredible and and then I just screenshot of that and I made it an exhibit thank you well it was like
00:11:39
delightful back to you this is a literal road to you being a
00:11:46
kind human being like all the money that you've spent on therapy and just trying coaching to be nice to people you're
00:11:54
just nice naturally Max is in a good mood today I don't know why you're instigating him he's laughing
00:12:00
come on it's fine thank you to the AI perfect this is
00:12:05
confirmatory of what we know David wants to live in a set of Highly transactional relationships ideally with the machine
00:12:14
hahaha can that eventually help him making money can I ask you a question of sincerely sex did you what did you enjoy
00:12:20
more working with your team of humans on this or working with chat GPS more
00:12:27
enjoyable for you just personally well I think they both were I would say
00:12:32
that the human contributions were essential so okay it's not about enjoyment it's just you
00:12:39
know it's about this is just a job to get done but but it definitely sped things up enormously I I personally find the
00:12:46
hardest part of writing a Blog is when you're staring at that blank sheet of paper and just having to like spit out
00:12:51
the first thousand words yes yeah it's just so time consuming to do that but again if you start with the first draft
00:12:57
even if it's not very good then you can just edit it and it's specification yeah it's great for ideation
00:13:05
were important yeah I actually trusted it I know that you probably should fact
00:13:11
check it in a way because it can hallucinate but the things that we're saying made so much sense to me that I didn't think it was hallucinating well
00:13:17
this is a great moment to Pivot into what open AI did with plugins these came
00:13:23
fast and furious this week and a bunch of folks who had you know started verticalized chat GPT based projects
00:13:30
MVPs were like oh maybe my project MVP is now dead because instacart Open Table
00:13:37
shop if I slag zapier and zappier obviously like if then this then that is
00:13:42
a very wide-ranging tool that allows you to connect apis from a multitude of
00:13:48
sources and what this all lets you do at the end of the day is have chat GPT
00:13:54
ping one of these sources just like an app might do or some custom software
00:13:59
might do ping the API and return data so hey what tables are open
00:14:05
on OpenTable maybe Shopify find me things to buy in
00:14:11
this category Etc and so people have started building little scripts we used to call these uh
00:14:17
when magic leap was out internet agents and the concept of a software agent
00:14:23
that's existed for a long time actually in computer science I'm sure free birkett will give us some examples of
00:14:29
that but also chat GPT can now use a browser so that means you can get around the dated nature of the content in the
00:14:37
corpus somebody did things like hey build me a meal plan book me a reservation for
00:14:42
Friday night in OpenTable Source other ingredients and buy it for Saturday night on Insta cart and then use
00:14:47
something like wolf from Alpha to you know calculate the calories Etc so when you saw all this drop sax what
00:14:55
did you think in terms of the opportunity for startups and to
00:15:01
build these intelligent agents things that will do if then if this then that or just background tasks
00:15:09
over time and you could actually leave them running yeah I mean I think this is the most important developer platform
00:15:15
since the iPhone and the launch of iOS in the App Store and I would argue maybe
00:15:20
ever in our industry certainly since the beginning of the internet I think there was a question when chat GPT launched on
00:15:28
November 30th and people start playing with in December what exactly open ai's product strategy was going to be was
00:15:35
this just like a proof of concept or a demo and they even kind of called it like a demo
00:15:42
and initially it looked like what their business model was going to be was providing an intelligence API that other
00:15:48
websites other applications could incorporate and we saw some really cool demos like that notion demo of other
00:15:55
applications incorporating AI capabilities and so initially it looked like what openai was going to be was
00:16:02
more like stripe where in the same way that stripe made payments functionality
00:16:07
available very easily through a developer platform they were going to make AI capabilities available through
00:16:12
their developer platform and then I think a Funny Thing Happened on the Way to this announcement which is they
00:16:18
became the fastest growing application of all time talking about chat GPT over 100 million users in two months
00:16:25
nobody else has ever done that before I think it took the iPhone you know two years plus Gmail Google
00:16:32
those products all took I think well over a year so this became the fastest growing site of all time and I think
00:16:39
with plugins what they're indicating is that they will become a destination site this is not just a developer platform
00:16:45
this is a destination site and through plugins they are now incorporating the ability to basically
00:16:52
you know anything you could do through an application you will now be able to do through a plug-in you'll just tell
00:16:57
chat GPT what you want done if you say hey book me a plane ticket on this date
00:17:03
it will go into kayaks plugin and do that you say book me a plane ticket and then an Airbnb for the promise of Siri
00:17:09
and Alexa realize because those were very rigid they had no intelligence
00:17:14
right Friedberg who if you if you wanted Siri to do something specific like use
00:17:19
Waze or to go get you an Open Table it needed to be pretty specific and it didn't have any kind of natural language
00:17:26
model behind it so this is taking existing apis and putting a natural language layer in front of it which
00:17:33
makes it uh you know perform a little more naturally is that what we're seeing here free bird I think it provides
00:17:39
access to a corpus of data and a suite of services that are not
00:17:45
well integrated into a search or chat interface anywhere today so
00:17:51
you know knowing what restaurants have what seats available is in a closed service it's in a data warehouse
00:17:57
operated by OpenTable and now what opendable can do is provide an API into
00:18:03
that data via an interface and they can allow chat GPT to make a request to
00:18:08
figure that data out to give a response to a user where they can ultimately benefit from
00:18:15
transacting and allowing a service this closes the loop between search and
00:18:21
Commerce in a way that Google cannot and does not do today and I think that's
00:18:27
what makes it very powerful we've seen this attempted in a number of important ways in the last couple of years with
00:18:32
Alexa and apple home and Google home kind of integration via the chat services that they offer
00:18:39
you know where you speak to the device but the Deep integration that's possible now
00:18:45
and the natural language way that you can go from the request all the way through to the transaction is what makes
00:18:51
this so extremely powerful and I think you know the points I made a few weeks
00:18:56
ago when we first talked about you know search having so many searches that are done where the human computer interface
00:19:03
presents a table or presents a chart or presents a shopping list in a matrix that's what makes search such a
00:19:10
defensible product I think could theoretically be completely obviated or destroyed with an interface like this
00:19:17
where you can write the ability for chat GPT or whatever the the core centralized services to
00:19:23
actually present results in a table in a matrix in an interface in a shopping list and actually close the transaction
00:19:30
Loop it's really disruptive to things like Commerce providers it's really disruptive you know some of these
00:19:36
Commerce platforms it's really disruptive to a lot of different Industries but also introduces a lot of real opportunity
00:19:42
to build on top of that capability and that functionality to rewrite and ultimately make things easier and better
00:19:47
for consumers on the internet what do you think about you're looking at this and it seems to be moving at a very fast
00:19:53
pace over 100 million users they put a business model on it already 20 bucks a month they have a secondary business
00:19:59
model of hey use the API and we'll charge you for usage and then you layer on what zapier and if this then that had
00:20:06
already sort of established in the world which is apis but nobody ever really wanted to write scripts so that seemed
00:20:13
to be the blocker you go into zapier if this and that it's worth five percent of the audience people want to customize
00:20:18
stuff people who want to Tinker but this seems to now with the chat GPT chat interface open it up to a lot of people
00:20:24
so is this super significant or is this a commodity product that you know 10 people will have we're sitting here next
00:20:30
year on all in episode 220. I think you are asking the exact right question and you use the a great term like in poker
00:20:38
if there are three hearts on the board and you have the ace of hearts
00:20:45
you have What's called the nut blocker right which means that nobody else even if anybody else has a flush they never
00:20:51
have the best flush and it flushes the best hand there's a lot of ways that you can manipulate the pot and eventually
00:20:57
win the pot because you have that ace of hearts and nobody else has it the concept of blocker
00:21:04
I think is very important to understand here which is what are the real blockers for this capability to not be broadly
00:21:11
available so I think you have to segregate you have the end user destination
00:21:17
you have the language model and then you have the third party services and so if you ask the question
00:21:23
what is the incentive of the third party service well the shareholders of
00:21:30
a travel site right they're not interested in doing an exclusive deal with any distribution
00:21:36
endpoint they want their services integrated as broadly as possible right so I think the the answer for the
00:21:43
service providers is just like they build an app for iOS and for Google and you know if they could
00:21:49
have Justified it they would have built an app for a gaming console they can't yeah they do right so that's going to
00:21:57
get commoditized and broadly available I think on the llm side I think we've talked about this
00:22:03
everybody's converging on each other in fact there was an interesting article that was released that said that
00:22:10
there was a handful of Google Engineers that quit because apparently bard was actually learning on top of
00:22:19
chat GPT which they felt was either legal or unethical or something
00:22:25
right so so the point is I think we've talked about this for a while but all of these models will converge in the
00:22:31
absence of Highly unique data right what I've been calling these white truffles so if you can hoard white truffles
00:22:38
your model will be better otherwise your model will be the same as everybody else's model
00:22:44
and then you have the distribution endpoints of which there are many whose economic incentives are very high right
00:22:49
so Facebook doesn't want to just sit around and have all this traffic go to chat GPT they want to be able to
00:22:55
enable Instagram users and WhatsApp users and Facebook users to interact through Messenger what have you
00:23:01
obviously Google has a you know many hundreds of billions of reasons to defend their territory
00:23:07
so I think all of this to me just means that these are really important use cases
00:23:12
as an investor I think it's important to just stay a little patient
00:23:19
because it's not clear to me that there are any natural blockers but I do think that David's right that it's
00:23:24
demonstrating a use case that's important but it's still so early we are six weeks
00:23:30
in yeah I tell you I think there's a couple of great blockers here where there's going to be an m a bonanza for
00:23:36
Silicon Valley if you look at certain data sets Reddit stack Overflow for programming
00:23:43
and quora these things are going to be worth a fortune and to be able to buy those or get exclusive licenses to those
00:23:50
if you're maybe Google barred or if you're a chat EBT that could be a major Difference Maker Twitter's data set
00:23:55
obviously and then you look at certain tools like zapier and if this and that they've spent a decade building the sort
00:24:02
of you know meta API that would be an incredible blocker I I think this is
00:24:07
going to be like a box Organization for free they did a plug-in for free
00:24:13
exactly yeah I was just gonna say I don't think these are not blockers I don't think this is the ace of hearts on the flushboard I don't think so I think
00:24:19
that these things are really interesting assets they are definitely trufffully in nature
00:24:25
but they may not be the you know 10 pound white travel from elbow that we're looking for you know but on the m a side
00:24:31
don't you think this would be like incredible no but the only reason I say that again is it is just so early like I
00:24:36
in the text I I mentioned this to you guys I remember and sax and I were in the middle of this
00:24:42
we were both right at the beginning of social networking sack started Genie I was in the middle of aim and all of a
00:24:49
sudden we saw Reed start social net then we saw Friendster get started then we
00:24:54
saw Myspace get started and you have to remember when you look back now 20 years later the winner was the seventh company
00:25:01
which was Facebook not the first not the second it was the seventh which started two and a half years properly after the
00:25:09
entire web.20 phenomenon started yeah same with search by the way where Google was probably 20 to the scene yeah excite
00:25:17
like us if you want to be a real student of business history I'll just say something that's more meta which is if
00:25:23
there's something that I've learned on the heels of this svb Fiasco is that there is an enormous
00:25:30
amount of negative perception of Silicon Valley and frankly a lot of disdain for
00:25:36
VCS and prognosticating technologists right and I think that so yeah this
00:25:41
podcast I think we have to be very careful yeah and and I I do think that we are an
00:25:47
example of that because we are the bright shiny object of the people that were successful and the broad makeup of
00:25:53
America thinks that we're not nearly as smart as we all think we are and after all of this money that's been burned in
00:25:59
crypto land and nfts and all this web 3 nonsense to yet again whip up the next hype cycle
00:26:05
I think doesn't serve us well so I do think there's something very
00:26:11
important here but I think if we want to maintain
00:26:16
reputational Capital through this cycle because government will get involved much faster in this cycle I think it's
00:26:23
important to just be methodical and thoughtful iterate experiment but it's too early to call it
00:26:28
I guess is what I would say yeah it's definitely too early to call it but sax you're saying explicitly you think this
00:26:33
is bigger than the internet itself bigger than mobile as a platform shift it's definitely top three and I think it
00:26:40
might be the biggest ever I think look I think things could certainly play out the way that jamath is saying however I
00:26:46
actually think that open AI has demonstrated now with these platform features that it has a lead a
00:26:54
substantial lead and I actually think that lead is likely to grow in the next year and let me tell you why I think
00:26:59
it's got a couple of assets here that are hard to replicate so number one user attention I think they've now got I
00:27:06
would guess hundreds of millions of users and this thing is caught on like wildfire it must have been beyond their
00:27:12
Wildest Dream I think it even surprised them how much this has taken off it's really captured the Public's imagination
00:27:18
and people are discovering new use cases for it every day if you are sort of the
00:27:23
the number two or number three you're the seventh large language model to basically get deployed behind a chatbot
00:27:29
I just don't think you're going to get that kind of distribution because the novelty Factor will have worn off and people will have already kind of learned
00:27:36
to use chat GPT so number one is the hundreds of millions of eyeballs number
00:27:41
two is with this developer platform I think we should describe a couple of other features of it
00:27:46
one of the problems with chat GPT if you've used it is that the training data ends in 2021 and so you very rapidly for
00:27:54
many questions get to a stopping point where it says like I don't I don't know the answer to that because I don't have any information about the last two years
00:28:01
well one of the plugins that openai is introduces itself is called the browsing plugin and it allows chat GPT to go
00:28:09
search the internet and not just run internet searches but to run an internet search as if it were a human so you ask
00:28:17
you asked chat GPT a question and it goes to find it runs a search and then
00:28:22
it scours through the list of 20 links and it doesn't stop until it finds a good answer and then it comes back to
00:28:27
you with just the answer so it actually saves you the time of clicking through all those loops and it'll give you the browsing history to show you what it did
00:28:33
that's mind-blowing they also have a thing called a retrieval API which allows developers to share proprietary
00:28:40
knowledge bases with chat GPT so if you have a company knowledge base or some other kind of content you can share with
00:28:48
chat gbt so that chat GPT can be aware of that and there are some privacy concerns but the company has said
00:28:53
they're gonna sandbox that data and protect it as an example I'm planning on writing a book on SAS using chat GPT and
00:29:01
I'm going to put together all the previous articles and talks I've done as a database so I can then work with that in chat GPT so you're going to have more
00:29:09
and more Developers sharing information with chat GPT you're
00:29:15
going to have chat GPT able to update its training based on sort of the last two years being able to search the
00:29:21
internet and I think that as those hundreds of millions of users use the product and as developers keep sharing
00:29:26
more and more of these data sets the AI is going to get smarter and smarter and then what's going to happen is both
00:29:31
consumers and developers are going to want to use or build on the smartest API yeah see this is where it feeds on
00:29:38
itself I mean yeah I think there might be a I agree with much of what you're saying but I do think somebody like Facebook
00:29:44
when they release their language model which they're about to is not going to allow chat gbt to have any access to the
00:29:51
Facebook Corpus of data and then LinkedIn will do the same they'll block any access to chat GPT to their data and
00:29:57
so then you might say you know what I'm doing something related to business and business contacts I need to use the LinkedIn one and they're just going to
00:30:03
block other people's usage up and tell you hey you have to come to our interface and have a pro account on LinkedIn and this all becomes little
00:30:09
islands of data and so I'm not sure that you may be right Jake Cal it's too early to have a definitive opinion but I would
00:30:15
say you have to believe plugins are going to be promiscuous yeah no it's actually plug-ins are the refutation of your iPhone Facebook does not have an
00:30:21
API Twitter turned off their API people who are smart quora doesn't let people use its data so I just picked three
00:30:28
those are three incredible data sets that don't allow people and Craigslist doesn't so people who are smart do not
00:30:34
allow apis into their data they keep it for themselves I think there were a lot of people when the App Store rolled out
00:30:41
that swore up and down they've never built a mobile app because they didn't want to give Apple that kind of power that the internet was open whereas the
00:30:47
app store is closed and curated by Apple and sure enough they all at the end of the day had to roll out apps even though
00:30:53
in the case of Facebook it definitely has made them vulnerable because they're Downstream of Apple I mean Apple
00:30:59
now has enormous influence over Facebook's advertising Revenue because users have to go through Apple they
00:31:05
never have to do that before with the internet nonetheless Facebook felt compelled to release a mobile app because they knew it was existential for
00:31:11
them if they didn't and I believe that what's happening is I don't think it's red analogy the right analogy would be
00:31:16
Google search does Facebook does Craigslist allow their data to be indexed inside of Google search answers
00:31:22
no right they block that for a reason they and they will write a cease and deceased letter fine so so you know what
00:31:28
those guys will stay out of it but look how much content Google search already has and I think that chatgpt will start
00:31:34
by eating a substantial portion of search because again you don't have to go through the 20 links it just gives you the answer it's going to eat a
00:31:40
substantial portion of browser usage and app usage because you're just going to tell chai GPT what you want to do it
00:31:47
will go book your plane ticket it will go book your hotel room yeah see this is another person I want to play in this
00:31:53
hold on the apps that want to play in this will benefit so there'll be a powerful incentive for applications to
00:31:58
get an advantage by participating let me finish my point yeah and then eventually they will be forced to do it not because
00:32:05
they get an advantage but because they're so competitively disadvantaged if they don't participate in that ecosystem I agree that they'll
00:32:11
participate in it but here's the thing what's going to happen is Google's going to turn on Bard and I've been playing with Bard it is 80 of chatgpt already
00:32:19
and then when they make Bard a default you know a little snippet on your Google
00:32:25
search return page or Bard is built into YouTube or Chrome or Android or the Play Store They're Gonna Roll right over chat
00:32:31
GPT because they have billions of users already so this advantage that you see today I see that getting rolled real
00:32:38
quick because you'll be on YouTube and on the top right hand side will be barred and when you do a search it's going to say here are other sentences
00:32:45
you could do oh you want to search Mr Beast when he's helped people or Mr Beast when he's giving away more money
00:32:50
or people who've copied and been inspired by Mr Beast all that's going to occur inside of YouTube and chat CPT is not going to have access to the YouTube
00:32:56
Corpus of data and then when you do a search it's going to be the same thing it's going to be on the right hand side and it's going to be playing just like
00:33:01
it is in bing if you turn on your Android phone they're going to make Google Assistant go right into Bard and
00:33:07
Google assistant is already used by hundreds of millions of people so I think that Google will roll I think
00:33:13
they're going to roll chat GPT I don't know who's gonna win but I'm looking at this Saxy poo more reductively as a
00:33:20
capitalist which is what are people's incentives because that's what they'll do Google's incentive is to usurp chat
00:33:28
gpt's usage by inserting something inside of their
00:33:34
existing distribution channels to suppress the ability for you to want to go to the app known as bundling I think
00:33:42
Facebook has that same incentive oddly even though Microsoft is such a deep partner I think certain assets of
00:33:48
Microsoft have that incentive you're talking collectively about five or six trillion dollars of market cap than when
00:33:54
you add in Alexa and Amazon and Siri and Apple
00:33:59
what is their incentive I don't think their incentive is to let this happen and I think if you look at the slack
00:34:05
Microsoft teams example of even a better engineered product who's excellent and widely deployed
00:34:11
even at hundreds of millions of users doesn't much matter when it's more cleverly distributed and priced and
00:34:19
so those things again you may still be right all I'm saying is it's just so early to know and as slow
00:34:27
and lumbering as some of these big companies are they are not so stupid as to kill their own Golden Goose and or
00:34:34
defend it when threatened so I think you just have to let let it see what happens I want to finish the point on Google and then we can move on to the bundling
00:34:40
thing let me just make the counter argument which is that I think Google was caught completely flat-footed here
00:34:46
even though they shouldn't have been because they published the original paper on Transformers in 2017. they
00:34:51
should have seen where all this was going but they didn't open AI use that paper and commercialized it and the
00:34:58
proof of that is there was just a lawsuit a couple of days ago or at least a claim by a former employee of Google
00:35:04
who quit because he said that they were using chat GPT to train their AI so
00:35:12
their AI is so far behind they were violating the terms of use hold on they were violating the terms of
00:35:18
use of open AI to train their own AI on chat GPT that's not a good sign that's
00:35:25
not a good sign I also think nonsense hold on let me I'm just reading the counter argument here I mean don't
00:35:31
dismiss it out of hand give me a chance to explain it moreover chat gpt4 which was just released a few
00:35:38
weeks ago we know that openai had that they were using it internally for seven months so the state of the art is not
00:35:45
what we're using it's what openai has internally they're obviously working now on chat gbt5 and so if you're saying
00:35:54
that Bard is 80 of chat gpt4 well I got news for you it's probably 50 or 20
00:36:00
percent of chat GPT 5. and who knows what the product roadmap is inside of
00:36:06
open AI I am sure that they've got 200 ideas for things they could do to make
00:36:11
it better and lowing fruit but look regardless I think the pace of innovation here and development is going
00:36:17
to speed up massively I mean there is going to be a flurry of activity I agree it's hard to know exactly how it's going
00:36:23
to play out but I think this idea that oh it's a foregone conclusion these big companies are just going to catch up with open AI I I think that there's a
00:36:30
strong counter argument I'm making a very specific argument it's not a foregone conclusion where all the value
00:36:36
will get captured just like in any of these major tidal waves if you make the bets too early
00:36:43
you typically don't make all the money and it tends to be the case and it has been in the past at least with these
00:36:49
transformative moves it's sort of in the early third of the cycle is where the
00:36:55
real opportunities to make the tons of money emerge and there's a lot of folks that show you a path and then just don't
00:37:01
necessarily capture the value I'm not saying that that's going to be the case here all I'm saying is if history is a
00:37:06
guide all of these other big waves have shown that fact pattern and so I'm very
00:37:12
excited and I'm paying attention but I'm just being circumspect with this idea that you know having been in the middle
00:37:18
of these couple of waves before it I made all the money by waiting a couple years I don't know if that's going to be true this time around but right that's
00:37:24
sort of my posture right now look you obviously have a point because we're only four months in so how can we know where this is going to be in five years
00:37:30
so you could be right to your point Zacks yeah I think it's clear and this is you know Big Ups to the open AI team
00:37:36
that they will be one of the top two or three players absolutely we all agree on that which is extraordinary in of itself
00:37:42
and the top four players Freeburg are obviously gonna be Microsoft open AI we'll call that like
00:37:49
whatever that little uh you know pairing and then Google Facebook and then we
00:37:55
haven't talked about Apple but obviously apple is not going to take this sitting down and hopefully they'll get in gear and have Siri you
00:38:02
know make it to the next level or they'll just put her out to pasture if you were to look at those
00:38:07
four and we're sitting here a year from now who has the best product offering who
00:38:12
has the biggest user base just take a minute to think about that because you were at Google and we all know the word
00:38:19
on the street is It's the Return of the Kings Larry and Sergey are super engaged by all reports
00:38:25
every back Channel everybody I talked to is saying that their everyday they're obsessed with Google's Legacy now and
00:38:32
making this happen so what can you tell us in terms of who you think a year or two from now
00:38:37
will have the biggest user base and be the most Innovative amongst that quartet or maybe you think there's other players
00:38:44
who will emerge the advantage that open AI has which is the advantage that any
00:38:51
call it emerging you know Advantage competitor has outside yeah Outsider is that the
00:39:00
incumbents are handicapped by their current scale much of the consideration set that Google has had in deciding what
00:39:08
features and tools to launch with respect to AI over the last couple of years has been driven fundamentally by a
00:39:13
concern about public policy and public reaction and I know this from speaking to folks there that are close enough to
00:39:21
kind of indicate like Google has been so targeted has been such the point of
00:39:27
attack by governments around the world with respect to their scale and Monopoly and
00:39:32
monopolistic kind of behavior of some people have framed it privacy concerns you know
00:39:40
etc etc the fines in the EU are extraordinary that so much of what goes on at Google today is can I get approval
00:39:47
to do this and so many people have felt so frustrated that they can't actually unleash the toolkit that Google has
00:39:52
built and so they've been harnessed and focused on these internal capabilities I think I mentioned this in the past but
00:39:58
things like what's the right video to show on YouTube to keep people engaged what's the right ad to show to increase
00:40:04
click-through rates etc etc versus building great consumer products for fear of the backlash that would arise
00:40:10
and governments coming down and ultimately attacking the the revenue and the core Revenue stream and this is
00:40:17
no different than any other kind of innovative dilemma you know any other business of scale and any other industry
00:40:22
historically ultimately gets disrupted because their job at that point is to protect their cash flow and their
00:40:28
revenue stream and their balance and their assets not to disrupt themselves especially as
00:40:33
a public company especially under the scrutiny and the watchful live governments and Regulators so I think
00:40:39
Google has in aggregate probably good competitive Talent if not better Talent than open Ai
00:40:45
and others Google has arguably the best Corpus of data upon which to train the
00:40:51
best capabilities the best toolkit the best hardware issues are the lowest cost for running these sorts of models the
00:40:57
lowest cost for serving them etc etc so frankly they're way behind the battle is Theirs to lose if they are
00:41:04
willing to disrupt themselves and this is the moment that Larry and Sergey should wield those founder shares that
00:41:10
they have and they should wield the comments that they wrote in that Founders letter that they will always make the right decision for the long
00:41:15
term for this company even if it means taking a cost in the short term and disrupting themselves this is the moment
00:41:21
to prove that those founder shares were worth you know the negotiation to get there
00:41:26
and and I think that it is going to require a real degree of scrutiny a real degree of regulatory uncertainty a real
00:41:33
degree of challenge by governments and public policy people and perhaps even a revenue hit in the near term to realize
00:41:40
the opportunity but I do think that they're better equipped to win if they chose to well said well really well said
00:41:46
I think the founder share Insight is particularly interesting sax the fact that it did nothing with them yeah no no
00:41:54
I was just going to say the exact same thing it's like if they don't use it now what would it take and when
00:42:01
yet another case of the emperor has no clothes just a power grab by Silicon
00:42:06
Valley execs which was meaningless because if in this moment you don't wield that power and break that company
00:42:12
into bits as you need to what was the point of having it they need to come in and say we're going to give Bard results
00:42:19
to 10 of users and ask them to get feedback on it because who has worse queries than just one point I want to
00:42:25
make their favorite who has more reinforcement learning then Google that
00:42:30
search box is everywhere and people write and question after question and Gmail and Google Docs Etc et cetera I
00:42:37
mean they have so many people asking questions and YouTube might be the the transcripts of YouTube every video and
00:42:44
the image of every video and the comments under it you know the comments under the video you have the transcript
00:42:49
of what happened in this video and then what was the question and answer underneath it let me make the Counterpoint please to my own Point like
00:42:56
look at how gerstner came after Zuck so Zuck had his point of view his strongly held belief that AR VR was the future of
00:43:04
the platform that's what he wanted to bet into that's what he wanted to lean into it's what he wanted to build the company against he did it and then the
00:43:10
financial analysts and the investors came at him and said this is a waste of money focus on making money you have a
00:43:16
responsibility to shareholders F those Founders shares you don't deserve that 10x voting right or whatever the framing
00:43:21
might have been to get him to say you know what I acquiesce I'm giving it up and I think that we should also think about what's going to happen on the
00:43:27
other side Google Google is a trillion plus dollar market cap company their their Shares are owned by every public
00:43:33
endowment public pension fund Institutional Investor owns Google in their portfolio so the backlash against
00:43:38
Google making a hard bet like this and potentially destroying billions of dollars of cash flow in the process
00:43:44
every year will not be easy to do that the same sorts of letters that gerstner at all and obviously we love grossner
00:43:50
you know we can all defend him all day long at zoc is what might may end up happening with
00:43:56
with alphabet if they did choose to go this path sax what do you think here about the founder share specifically in
00:44:01
Google's chances of disrupting themselves and you know just putting this into every product and shoving it
00:44:08
down users throats uh and catching up well I mean with all due respect uh
00:44:14
Larry and Sergey I mean they've been on the beach a long time this reminds me of Apollo Creed coming
00:44:20
out of retirement in rocket before in a lot of shape a lot of a lot of things
00:44:29
it could be a little out of shape Sam Walton may not look like Ivan Drago but but this this is one shrewd character
00:44:35
this is one shrewd character I mean Altman is fit he's fed he's been in the arena yeah he's you know he's a
00:44:42
multi-time Founder who sat at the top of YC and got to see everything that worked yep and got uh and he's been plugging
00:44:49
away at this for what like eight years so there's a there's a big I just think
00:44:55
there's a big gap to catch up on now Google has all the resources in the world and they've got a lot of
00:45:01
proprietary assets too and they've got all the incentive in the world so do I think that Google will be one of the top
00:45:06
four players in AI absolutely but this idea they're just going to come and steamroll open AI I got a prediction but
00:45:13
then next year Larry and Sergey take the title of co-ceos and then they'll do a demo day where the two of them get on
00:45:20
stage and they actually do the demos of these projects because that happens that fictional pontification stuff that's it
00:45:27
that's listen and Bezos is going to run for president those are my two predictions I'm taking a lot of predictions can you imagine if Larry
00:45:33
Freeburg where are the chances of Larry and Sergey taking co-ceo slots that's prediction one and then prediction two
00:45:39
what are the chances of them running the next Google i o where they get on stage and they walk people through all the
00:45:45
products that they shepherded and that they have a vested interested in that they're they want to demo there
00:45:51
is an Institutional problem at Google at the top level which does need to be solved
00:45:56
which is this position of constantly being in defense against the scrutiny again of regulators
00:46:03
and public policy folks and and you know all these different groups that are against Google
00:46:09
and so as a result the kind of cultural seasoning particularly the executive and the board level has been one of like you
00:46:16
know protect the nest don't overreach don't overstep and it's a real you know
00:46:23
I think one for the for the business school books or whatever uh ultimately is what they end up doing about it because now as uh you know the time when
00:46:30
that defensive posture is really kind of putting the entire business at risk the same thing happened to Microsoft
00:46:35
remember in the late 90s that's right when they got crushed by that antitrust lawsuit very defensive well that can no
00:46:42
but that consent agree they put they had a wartime CEO come in Balmer came in and
00:46:47
you know followed by kind of an Innovative guy who could kind of continue to build and I think that there may be a moment
00:46:53
here I look I love Sundar he's a he's a great guy great CEO consider and I don't know if you guys if I ever told you this
00:46:59
and I started at Google on the same day we're both in the same nuclear class we wore the freaking hat on the TGIF day
00:47:05
and on stage he was a product manager and now he runs the company but I think the question is like how
00:47:11
whether it's the CEO or the broader whole kind of executive org or the board a degree of disruption necessary to
00:47:18
shift that cultural seasoning is so necessary right now for them to have a shot at this and similar to what you just said sax like you're gonna need a
00:47:24
bomber type moment to kind of you know reinvigorate that business and by the way moment I think then uh
00:47:32
well yeah because it's an important point when bomber took over during that period after Gates when they were on
00:47:38
their heels he basically just focused on revenue and paying dividends and stock BuyBacks and the
00:47:44
stock went sideways and he missed mobile and now yeah you know wait you're
00:47:50
forgetting one big thing which is that that was also because he had to operate under a consent decree to the doj exactly so the product managers of
00:47:57
Microsoft were replaced with lawyers from the Department of Justice and you had to get their sign off before you could ship anything so
00:48:03
we have to remember that those things probably slowed Microsoft down as well and the great thing that Satya had was a
00:48:11
blank slate and the removal of that consent decree so he was able to do everything that just made a lot of sense
00:48:17
and he's executed flawlessly I think the problem at Google is not
00:48:23
Sundar or Larry or Sergey I think it's more in the Deep bowels of
00:48:29
middle management of that company which is that there's just far too many people that probably have an opinion and their
00:48:36
opinion is not shrouded in survival their opinion is shrouded in Elite language around what is the moral and
00:48:44
ethical implications of this and where has this been properly tested on the
00:48:49
diaspora of 19 different ethnic tribes of the Amazon that's the kind of decision making that is a nice to have
00:48:56
when you are the second or third most valuable technology company in the world
00:49:02
but you have to be able to pause that kind of thinking and instead get into wartime survival mode and it's very hard
00:49:09
so it doesn't almost matter at this point what Sundar wants the real
00:49:15
question is what is the capability of middle management to either do it or get out of the way and I think that in all
00:49:22
of these big companies that struggle what you really see is an inability for middle management to get out of the way
00:49:27
or frankly just you need somebody to then fire them and if you look at folks
00:49:33
who get their groove back let's see what Facebook does what are they targeting they're
00:49:39
targeting middle management if you look at what Elon does in the companies that he owns there is virtually no middle
00:49:46
management but it's like get out of the way build product build product and ship it yeah
00:49:53
and what is the core truth and so if failure is there in front of you and if David is right that you have 200 million
00:49:59
users come out of nowhere who are voting every day with their time and attention
00:50:04
to use an app and that doesn't create a fire alarm fire where you get middle management out of the way and you are
00:50:10
the senior most people talking to the people doing the work and shipping things every day you're you are toast
00:50:18
you are toast a lot of people are starting to think we're moving a little bit too fast when it comes to open ai's
00:50:25
incredible performance without gpt4 the plugins and all this and so the future of Life Institute which was formed in
00:50:32
2015 it's a non-profit that's focused on de-risking major technology like AI they did a petition
00:50:40
titled pause giant AI experiments an open letter a bunch of computer scientists assign this letter
00:50:47
and uh the letter quote says we must ask ourselves should we let machines flood
00:50:54
our information Channels with propaganda and untruth should we automate away all the jobs including the fulfilling ones
00:51:00
should we develop non-human Minds that might eventually outnumber outsmart Obsolete and replace us should we risk
00:51:06
loss of control of our civilization a number of notable Tech leaders like Elon
00:51:11
Steve Wozniak and a handful of deepmind researchers have signed it what do you guys think of the latter are we going to
00:51:17
slow down or not and then we could ask the question generally how close are we getting to AGI which is what everybody's scared of is that these agents start
00:51:24
working with each other in the background to do things that are against human interest I know it sounds like science fiction but there is a theory
00:51:32
that when these AIS start operating on their own like we explained in the previous sort of segment here with
00:51:39
plugins and they make agents that are operating based on feedback from each other
00:51:45
could they get out of control and be mischievous and then work against human interest so what do you think sex I
00:51:50
think there's a difference between what could happen in the short term and then what could happen in the long term I think in the short term everything we're
00:51:56
seeing right now is very positive and let me just give you an example there was a really interesting tweet storm
00:52:03
about a guy who wrote about how Chad GPT saved his dog did you guys see this this
00:52:10
is one of the really mind-blowing ones to make use cases so his dog was sick
00:52:15
took him to a vet vet prescribed some medication three days later a dog's still sick in fact even worse so the the
00:52:22
owner of the the pet just literally copied and pasted the lab result for the blood test for the dog with all the the
00:52:29
lab values into chat EPT and said what could this be like what's your likely diagnosis shot GPT gave three possible
00:52:37
answers three illnesses the first one was what the vet basically diagnosed with so that wasn't it the second one
00:52:44
was excluded by another test so he then went to a second vet and said listen I think my dog has the third one and vet
00:52:51
prescribed something and sure enough dog is cured saved so that's really
00:52:57
mind-blowing that even though chat GPT hasn't been specifically optimized as far as we know for lab results it could
00:53:04
figure this out the reason I'm mentioning this is it gives you a sense of the potential here to cure disease to
00:53:09
you know like I could see major medical breakthroughs based on the AI in the next five or ten
00:53:16
years now the question is like what happens in the long term you know as the
00:53:21
AI gets smarter and smarter and we are kind of getting into the role of Science Fiction but here would be the scenario
00:53:27
is you're on chat GPT 10 or 20 or whatever it is or maybe some other companies AI and the
00:53:35
developers asked the AI hey how could you make yourself better now do it which is a question we asked chat GPT all the
00:53:42
time in different contexts and so chat GPT will already have the ability to write perfect code by that
00:53:48
point I think you know code writing is one of the I think of its superpowers already so it gives itself the ability to
00:53:54
rewrite its code to auto update it to recursively make itself better I mean at that point isn't that like a
00:54:02
speciation event doesn't that very quickly lead to the singularity if the AI has the capability to rewrite its own
00:54:09
code to make itself better and you know won't it very quickly write billions of versions of itself and you
00:54:15
know it's very hard to predict what that future looks like now I also don't know how far away we are from that that could
00:54:21
be 10 years 20 years 30 years whatever but I I think it's a question worth asking for sure is it worth slowing down
00:54:28
though sex should we be pausing because based on what you've said you know I think you've framed it properly when
00:54:34
these things hit a certain point and they start reinforcing their own learning with each other they can go at infinite speed right this
00:54:42
is not comparable to human speed they could be firing off millions billions of different I think you're right scenarios
00:54:48
we're definitely now on this [ __ ] around find out curve yeah and so there's only
00:54:54
one way to really find out which is somebody's gonna push the boundaries the
00:54:59
competitive Dynamics will get the better of some startup they'll do something that
00:55:05
people will look back on and say whoa that was a little that was a bridge too far so yeah where it's just a matter of time
00:55:12
yeah I think we're not going to slow down I actually think it's going the other way I think things are going to speed up and and the reason they're
00:55:18
going to speed up is because the one thing Silicon Valley is really good at is taking advantage of a platform shift
00:55:24
and so when you think about like all the VCS and all the founders you know everyone accuses us of being lemmings
00:55:32
and so when there's like kind of like a fake platform shift or people kind of glom
00:55:37
onto something that ends up not being real everyone's kind of got egg on their faces but the flip side of that is that
00:55:43
when the platform shift is real Silicon Valley is really good at throwing money at it the talent knows how to go after
00:55:49
it and they keep making it better and better and so that's the dynamic we're in right now you look at 70 of the last
00:55:56
YC class was ready all AI startups I'm sure the next one will probably be 95 so
00:56:01
I think that we're on a path here where the pace of innovation is actually going to speed up
00:56:06
companies are going to compete with each other they're going to seek to invent new capabilities and I think the results
00:56:12
are going to all be incredibly positive for some period of time like you know the vet example we're going to cure
00:56:18
illnesses we're going to solve major problems positive then we invest more we
00:56:24
trust more but the Paradox of that estimate is pointing out Freeburg is if we trust it more we invest more than
00:56:30
some person in a free market is going to say you know what I need to be chat GPT therefore I'm going to take the rails
00:56:36
off this thing I'm going to let it go faster and take off some constraints because I need to win and I'm so far
00:56:42
behind how do you feel about that scenario that sort of tremontan sax teed up Friedberg
00:56:48
I think there's like gpt3 I think ran on 700 gigs is that
00:56:57
right does anyone know what gpt4 runs on it's got to be on some number that's you know
00:57:03
not too not not a many multiples of that but
00:57:08
look someone could make a copy of this thing and Fork it and develop an entirely new
00:57:14
model I think that's what's incredible about software and digital technology
00:57:21
and also kind of you know means that it's very hard to contain similar to like what we've seen in in
00:57:27
biology ever since biology got digitized through DNA sequencing and the ability to kind of Express
00:57:33
molecules through Gene editing you know you can't control or contain
00:57:39
the ability to do Gene editing work at all because everyone knows the code everyone can make crispr cast molecules
00:57:46
everyone can make Gene editing systems in any lab anywhere once it was out it was out
00:57:52
and now there's hundreds of variants for for doing Gene editing many of which are much improved over crispr cast 9. I use
00:57:58
that as an analogy because it was this breakthrough technology that allowed us to precisely specifically edit genomes
00:58:04
and that allowed us to engineer biology and do these incredible things where biology effectively became software and
00:58:10
remember crispr cast 9 gave us effectively a a word processing type tool find and replace
00:58:17
and the tooling that's evolved from that is is much better so whatever is underlying
00:58:23
whatever the parameters are for gpt4 whatever that model is
00:58:28
if a close enough replicant of that model exists or a copy of that model is made and then new training data and new
00:58:35
Evolutions can be done separately you could see many many variants it kind of emerge from here and I think this is a
00:58:40
good echoing of chimoff's point we don't know what's ultimately going to win is there enough of a network effect in the
00:58:46
plug-in model as sax pointed out to really give open AI the sustaining competitive Advantage I'm not sure the
00:58:52
model runs on 700 gigs that's less data than you know fits on my iPhone so you
00:58:58
know I could take that model I could take the parameters of that model and I could create an entirely new version I could Fork it and I could do something
00:59:04
entirely new with it so I don't think you can contain it I don't think that this idea that we can
00:59:09
put in place some regulatory constraints and say it's illegal to do this
00:59:15
or you know try and you know create IP around it or protections around it it's realistic at this stage the power of the
00:59:22
tool is so extraordinary the extendability of the tools are so extraordinary so the economic and you
00:59:27
know the various incentives are there for you know other models to emerge and
00:59:32
whether they're directly copied from someone hacking into openai servers and making a copy of that model or whether
00:59:38
they're you know open sourced or whether someone generates something that's 95 is good and then it Forks in a whole new
00:59:44
class of models emerge I think this is like as sax pointed out highlighting the
00:59:50
kind of economic Market uprooting social uprooting potential and many models will
00:59:56
will start to kind of come to Market what do we think the impact of white-collar jobs getting annihilated by
01:00:01
this technology if that in fact one thing on this yeah look let me just share can I just give one example here so here's a Reddit post that I was made
01:00:09
aware of earlier this week I lost everything that made me love my job through mid-journey overnight I am
01:00:15
employed as a 3D artist at a small games company of 10 people our team is two people he basically explains
01:00:21
he says since mid-journey version 5 came out he's not an artist anymore nor a 3D artist all they do is prompting
01:00:28
photoshopping and implementing good looking pictures and he basically says this happened overnight and he had no
01:00:34
choice his boss also had no choice he says I am now able to create rig an animated character that's spit out from
01:00:40
MJ uh mid-journey in two to three days before it took us several weeks in 3D the difference is that he cares about
01:00:46
his you know job and for his boss it's just a huge time money saver he's no longer making art and the person who was
01:00:52
number two in the organization who didn't make as good content as him is now embracing this technology because it
01:00:59
Curry's favor with his boss and Ian's basically saying getting a job in the game industry is
01:01:04
already hard but leaving a company and a nice team because AI took my job feels very dystopian I doubt it would be
01:01:11
better in a different company also I am between grief and anger and I am sorry for using my gosh your art fellow
01:01:18
artists this is yet another reason that figma really needs to close this
01:01:23
acquisition from Adobe I mean it's like the value of these apps are just getting gutted if you take a workflow management
01:01:31
tool for things like design and imagery and you reduce it by an order of 90 it's
01:01:38
like what is that app experience worth and how could you replicate it if you
01:01:44
were a big company that already has distribution that's one comment but what I would tell you Jason to answer the
01:01:50
white collar question is I think there are a handful of companies you need to look at exclusively because they will be the first ones to
01:01:56
really figure out how to displace human labor and that is TCS so Tata consulting services
01:02:03
Accenture cognizant these are all the folks that do coding for higher work at
01:02:10
scale I think Accenture has something like 750 000 employees so the incentive to sort of squeeze Opex
01:02:17
to create better utilization rates to increase profitability is quite obvious it always has been they
01:02:24
will be the first people to figure out how to use these tools at scale before the law firms or the accounting
01:02:30
firms or any of those folks even sort of try to figure out how to displace what color labor I think is going to be the
01:02:35
coding jobs and it's going to be the coding for higher jobs that companies like Accenture and TCS so those business
01:02:41
processing do for other people developer kind of folks they're going to need half as many people 25 as many people we're
01:02:48
going to find out the efficient Frontier yeah I see it a different way I mean this argument that productivity leads to
01:02:55
job loss has been made for hundreds of years and it's always been refuted when you make human beings more productive it
01:03:01
leads to more Prosperity more wealth growth more growth and so yeah it's easy to think about in a narrow way the jobs
01:03:08
are going to be displaced but but why would that be it's because you're giving leverage to other human beings to get
01:03:14
more done and some of those human beings really anybody with a good idea is now
01:03:19
going to be able to create a startup much more easily so you're going to see a huge explosion in creativity in
01:03:25
startup creation new companies new jobs imagine think about the case of you know
01:03:30
Zuckerberg founding Facebook at Harvard he wrote the first version himself maybe with a couple of friends that project
01:03:37
happened and turned into a giant company because he was able to self-execute his idea without needing to raise venture
01:03:44
capital or even recruit employees even really before forming a company
01:03:50
anyone with a good idea to be able to do that soon you're going to be able to use these AI tools they truly will be no
01:03:55
code you'll be able to create an app or a website just by speaking to some AI program in a natural language way so
01:04:01
more flowers will bloom more startups more projects create it will create I think a lot of
01:04:07
dislocation but for every testimonial that is like the one that you showed
01:04:12
which I think is I'd say a little bit overly dramatic I have seen 10 or 100
01:04:18
testimonials from coders on Twitter or other blogs talking about the power that
01:04:24
these new tools give them they are like this makes me a 10x engineer right and especially these like Junior Engineers
01:04:30
who are right out of school who don't have 20 years of coding history they get superpowers right away
01:04:35
like it makes them so much better the proper responses let me give you a response to that guy
01:04:41
so so and using Sax's point that guy's saying what used to take me weeks I can
01:04:46
now do in two to three days and I feel like my work is gone and that's because he's thinking in terms of his output
01:04:52
being static and if he thinks about his output being dynamic he can now in the
01:04:58
matter of three weeks instead of making one character he cannot make a character every two days so he can make 30
01:05:04
characters in three weeks that's an alternative way for him to think about what this tooling does for him and his
01:05:10
business the number of video games will go up by 10x or 100x or a thousand X the
01:05:15
number of movies and videos that can be rendered in computers can go up by 10x or 100x or 1000x this is why I really
01:05:21
believe strongly that in some period of time we will all have our own movie or our own video game
01:05:27
ultimately generated for us on the Fly based on our particular interests there will certainly be shared culture shared
01:05:33
themes you know shared morality share things that that that tie all these things together and that will become the
01:05:40
shared experience but in terms of like us all consuming the same content it will really like with YouTube and Tick
01:05:46
Tock we're all consuming different stuff all the time and this will enable an acceleration of that Evolution and
01:05:51
personalization I'll also highlight you know back in the day one human had to farm a Farm by hand and we eventually
01:05:59
got the tool of a hoe and we could put in the ground and make you know make stuff faster the way we gotta plow and
01:06:05
then we got a tractor and today agricultural farm equipment allows one
01:06:12
farmer to farm over ten thousand acres you go to Western Australia it's incredible these guys have 24 row Planters and Harvesters and it's
01:06:18
completely changed the game so the unit of output per farmer is now literally
01:06:23
millions of times what it was just 150 and in that case Freeburg nobody wants to do back-breaking labor in the fields
01:06:29
and everybody but in this case let me just read you one quote that I didn't read in the original reading of this he says I want
01:06:36
to make art that isn't the result of scraped internet content from artists that were not asked and so I I think
01:06:43
that's part of this is that it's bespoke art but well yeah the one question I had for sacks was sex
01:06:49
you we started this conversation with saying hey this is different than anything in terms of efficiency that came before it this is I'm going to put
01:06:57
some words here right there but this is like a step function more efficient so to the argument of hey efficiency has
01:07:03
always resulted in you know more ideas and and we've found something to do with
01:07:08
people's time is this time different potentially because this is so much more powerful this isn't just like a spell
01:07:14
checker I would say differently I think and I agree with what Jay Cal is saying because I think that
01:07:19
the thing that technology has never done is try to displace human judgment
01:07:25
it's allowed us to replace
01:07:31
physical exertion of energy but it is always preserved humans injecting our
01:07:36
judgment and I think this is the first time where we're being challenged with autonomous systems
01:07:43
that has some level of judgment now we can say and it's true again we're four months in that that judgment isn't so
01:07:50
great but eventually and because of the pace of innovation eventually is probably not
01:07:57
that far away to judgment will become perfect I'll give you a totally different example you
01:08:02
know how many Pilots are there in the world will we at some point in the next 10 years
01:08:08
want folks to actually manually take off and land or will we want Precision guided
01:08:15
instrumentation and computers and sensors that can guarantee a Pitch Perfect Landing every single time in all
01:08:21
kinds of weather conditions so that now planes can even have 50x the number of sensors with a
01:08:28
computer that can then process it and act accordingly just a random example that isn't even thought of when we talk
01:08:33
about sort of where AI is going to rear its head I think that this judgment idea is an important one to figure out
01:08:39
because this is the first time I've seen something that is bumping up against our ability to have judgment and what this
01:08:46
person was talking about in this mid-journey example is his judgment has been usurped yes yeah I would disagree
01:08:53
yeah let me just let me just make one point on this so you know an image is a matrix of you
01:09:00
know data that's rendered on a screen and as pixels and those pixels are different colors and you know that's
01:09:07
what an image is is it or is it is it the Judgment of the Creator well no I'm just saying an image in general so like
01:09:13
when Adobe Photoshop and digital photography arose photographers were like this is you know BS why are you
01:09:19
digitizing photography with analog and beautiful before and then with digital photography allowed is the photographer to do
01:09:25
editing and to do work that was creative beyond what was possible with just a
01:09:30
natural photograph taken through a camera and they're arguably different art forms but it was a new kind of art form that emerged through digital
01:09:36
photography and then in the early 90s there was a plug-in Suite called Kai's power tools that came
01:09:42
out in Adobe Photoshop and it was a third-party plug-in set you would you would buy it and then it would work on
01:09:48
Photoshop and it did things like motion blur sharpening pixelation all these interesting kind of like features and
01:09:54
prior to those tools coming out the Judgment of the digital artist the digital photographer was to go in and do
01:10:00
pixel by pixel changes on the image to make that pixel to make that image look blurry or to make it look sharper or to
01:10:07
make it look like it had some really interesting motion feature and the Kai's power tools created this instant toolkit
01:10:12
where in a few seconds you created a blur on the image and that was an incredible toolkit but a lot of digital
01:10:18
artists said this is automating my work what is my point now why am I here and the same happened in animation when
01:10:25
three um when you know CGI came around and animators were no longer animating cells by hand and in every point in this
01:10:31
Evolution there was a feeling of loss initially but then the evolution of a whole new art form emerged and an
01:10:36
evolution of a whole new area of human creative expression emerged and I think we don't yet know what that's going to
01:10:42
look like do you think with respect to what you're seeing here do you think the the level of judgment that AI offers you
01:10:48
is the same as the level of judgment that high power tools offered you yeah look I mean I think that the person making the Judgment or the decision
01:10:53
about which pixel to change into what color felt like you know I have control and I think it's ultimately like I just
01:10:59
totally I disagree with you I mean I think that that's a magnitude difference it's more other than a magnitude
01:11:05
difference yeah it's still love it's on you you know you and I have sat in spreadsheets and we've
01:11:12
I'm generally happy with this idea so I'll give you a different example today we use Radiologists and
01:11:18
Pathologists to identify cancers yep there are closed loop systems we have
01:11:23
one right now that's in front of the FDA that is a total closed-loop system that will not need any human input
01:11:30
so I don't know what those folks do except what I can tell you is that we
01:11:37
can get cancer detection basically down to a zero percent error rate that is not possible with human
01:11:42
intervention that is judgment right so I just think it's important to
01:11:49
really acknowledge that this is happening at a level that it's never happened before you may be right that there's some
01:11:55
amazing job for that radiologist or pathologist to do in the future I don't know offhand what that is
01:12:02
but these are closed loop systems now that think for themselves and self-improved I get it but I think that
01:12:08
there there's an unfathomable set of things that emerge we did not have the concept of Instagram influencers we did
01:12:14
not have the concept of personal trainers we did not have the concept of like all these new jobs that
01:12:21
have emerged in the past couple of decades that people enjoy doing that they can make money doing that is a
01:12:27
greater kind of experience and level of fulfillment for those that choose and have the freedom to do it than what they
01:12:32
were having to do before when they had to work just to make money and they think that Radiologists or pathologist
01:12:38
wants to do be a trainer or a Pilates instructor no I think we don't know what that's going to look like
01:12:43
yeah yeah you have any thoughts on this as we wrap this topic it's obviously a lot of
01:12:48
passion coming out yeah the elimination of White Collar jobs in a massive way I think that this is a short-term versus
01:12:54
long-term thing in the short term I see the benefits of AI being very positive because I don't think it's in most cases
01:13:01
wiping out human jobs this is making them way more productive you still need the developer it's just that there are
01:13:07
five times or 10x more productive but I don't think we're at the point in the short term we're gonna be able to
01:13:13
eliminate that role entirely and what I've seen in basically every startup I've ever been a part of is that the
01:13:18
limiting factor on progress is always engineering bandwidth that is always the
01:13:24
the thing that you wish you had more of totally it's the product roadmap is always the most competed on thing inside
01:13:30
the organization everyone's trying to you know get their project prioritized because there's just never enough
01:13:35
engineering bandwidth it's really the lifeblood of the company so if you make the developers more productive and maybe
01:13:41
it just accelerates the product roadmap I just I don't think in the short term that what's going to happen is these companies are going to look to cut all
01:13:48
their developers because one or two of them can do 10 times the work I think that they're going to try and accelerate
01:13:54
their product roadmaps now again you have this long-term concern that maybe you don't need developers at all at some
01:14:00
point but I think that the benefits of developing this technology are so great in the short to midterm that we're going
01:14:07
down that path no matter what and we're just going to find out what that long term really looks like and maybe the
01:14:12
long term will look very different I mean once again once you get past the short term we may have a different
01:14:17
long-term View I think in this narrow vertical I 100 agree with you look I I think that AI is
01:14:24
going to eliminate unit testing it has already done so it's going to eliminate most forms of coding the engineers that
01:14:30
you have all of them will now become 10x Engineers so with fewer of them or with the same number you'll be able to do as
01:14:37
much or more than you could have before that's a wonderful thing and all I'm saying on that specific narrow vertical is you'll see it first rear its head in
01:14:44
companies like Accenture and TCS because and cognizant because they have an immediate incentive to use this tooling
01:14:52
to drive efficiency and profitability that's rewarded by shareholders it'll be less visible in other companies so but
01:14:59
what I am saying though is that you have to think about the impact on the end markets for a second and I think that AI
01:15:07
does something that other technology layers have never done before which is
01:15:12
supplant human judgment in a closed-loop manner and I just think it's worth appreciating that there are many systems
01:15:18
and many jobs that apply it that rely on human judgment
01:15:23
where we deal with error bars and an error rate that a computer will
01:15:30
just destroy and blow out of the water and we will have to ask ourselves should this class of job exist with its
01:15:37
inherent error rate or should it get replaced fully by a computer which has no error rate and I think that's an
01:15:42
important question that's worth putting on the table okay so let's wrap here I just have my final thought on it is like
01:15:47
you're going to see entire jobs categories of jobs go away we've seen this before phone operators travel
01:15:53
agents copy editors illustrators logo designers accountants sales development reps I'm seeing a lot of these job
01:16:00
functions in the modern world like phone operators previously I think these could
01:16:05
wholesale just go away and they would just be done by Ai and I think it's going to happen in a very short period of time and so it's going to be about
01:16:11
who can transition and some people might not be able to make the transition and that's going to be pain and suffering and it's going to be in the white collar
01:16:16
ranks and those people have more influence so I think this is could lead to some societal disturbance
01:16:22
I'm going to learn Pilates and be an influencer that's it but I do agree with sax that the the software development
01:16:28
backlog if this is what you're saying is so great that I don't think we'll see it in software development for a decade or
01:16:33
two there's just so much software that still needs to be made all right last week we talked about Tick Tock and this first bipartisan hearing we've seen in a
01:16:39
long time and people actually I think framing correctly exactly how dangerous it is in my opinion to have Tick Tock in
01:16:46
the United States and of course then we get the great disappointment of the actual bill the
01:16:52
restrict Act was proposed by Senator Mark Warner Democrat Virginia on March
01:16:58
7th the problem with it is is it seems like it's poorly worded that there will be civil penalties and
01:17:04
criminal penalties to Americans for breaking the law and using software that's been
01:17:10
banned and many people said you know this probably is just bad language I
01:17:16
have a question yeah does it does this apply to incognito mode foreign
01:17:25
they're saying that you can get you know you can get fined or 20 years in jail or whatever it is for using a VPN to VPN to
01:17:33
tick tock freyberg what are your thoughts on it look I think this is a real threat to the open internet I'm really concerned about the language
01:17:40
that's been used that basically speaks to protecting the Safety and Security of the American people by actively
01:17:47
monitoring Network traffic and making decisions about what network traffic is and isn't allowed to be transmitted
01:17:53
across the open Internet it's the first time that I think in the United States we're seeing like a real threat and a
01:17:59
real set of behaviors from our government that looks and feels a lot like what goes on in China and elsewhere
01:18:05
where they operate with a closed internet and internet that's a controlled monitored observed cracked
01:18:11
and and gates are decided by some set of Administrators and what is and isn't appropriate and the language is always
01:18:17
the same it's for Safety and Security of the people the entire purpose of the inner that is that it did not have
01:18:23
bounds that it did not have governments that it did not have controls that it did not have systems that are politically and economically influenced
01:18:30
that the architecture of the internet was and always would be open the protocols are open the transmission of
01:18:35
data on that Network would be open and as a result all people around the world would have access to information
01:18:41
of their choosing and it allowed ultimate freedom of choice you know this this kind of is the first
01:18:47
of what I'm concerned creates a precedent that ultimately leads to a very slippery slope saying that Tick
01:18:52
Tock cannot make money in the US by charging advertisers or managing Commerce flows is one thing that's where
01:18:58
the government can and should and could if they chose to have a role but I think going in and observing tracking internet
01:19:04
traffic and making decisions about what is and isn't appropriate for people I think is one of the things that we all
01:19:11
should be most concerned about what's going on right now there is no end in sight to this if you
01:19:16
allow this to happen uh in the first time you know vpns uh virtual private networks allow you to anonymously access
01:19:24
internet traffic and and access internet traffic via remote
01:19:29
destinations so so that the ultimate consumption of content that you're using
01:19:35
can't be tracked and monitored by local agencies or isps and I think that saying
01:19:41
that that can now be restricted takes away all ability to have true privacy and All rights to privacy on the open
01:19:47
internet so I'd love to talk about this more unfortunately I gotta run um this is a
01:19:53
super threat to me and I I think this is something we should be super super concerned about and that the entire
01:19:58
community of Technology internet and anyone that wants to have you know Freedom of Choice steps up and says this
01:20:05
is totally inappropriate and overreached yeah there are other ways to manage stuff like it feels like complete overreach sex yeah
01:20:12
intentional overreach are poorly written or somewhere in between what do you think both I think both I think this is
01:20:18
the biggest bait and switch that Washington the central governments ever tried to pull on us
01:20:23
everybody thinks that they're just trying to ban Tick Tock from operating the U.S and if that's all they did then
01:20:28
I think the bill would be supported by most Americans but that's not what they're doing they're not restricting Tick Tock they're restricting us that's
01:20:35
not the goal here yeah but a bait switch it's a huge bait and switch and so just so you know what the ACT provides is
01:20:41
that a U.S citizen using a VPN to access Tick Tock could theoretically be
01:20:46
subjected to a maximum penalty of one million in fines or 20 years in prison or both now
01:20:53
you know they'll say you know Mark Warner the sponsored legislation will swear up and down down that's not the
01:20:58
intent but the problem is the language of the bill is so vague that some clever prosecutor may want to pursue this
01:21:04
Theory one day and that needs to be stopped also there's another problem with the bill which is you think this is
01:21:11
just about tick tock it's not what they do is it says here I guess they don't want to
01:21:17
mention Tick Tock by name so they're trying to create a category of threatening application but because it
01:21:23
is a category it's very very broad so the bill states that it covers any
01:21:29
transaction transaction not just an app in which an entity described instead of
01:21:34
paragraph B has any interest and then entities described in some paragraph B are quote a foreign adversary and entity
01:21:42
subject to the jurisdiction of organizing the laws of a foreign adversary and entity owned director control by either of these and then it
01:21:49
gives the Executive Branch the power to name a foreign adversary
01:21:55
any foreign government regime that one of the cabinet secretaries defines without any vote of Congress
01:22:02
so this is giving sweeping powers to the executive branch to declare you know foreign companies to be and it
01:22:09
feels like the plot of the uh prequels and Star Wars emergency Powers here we go you know we criticize uh China for
01:22:15
having a great firewall what do you think this is yeah I mean this this should obviously
01:22:21
have nothing to do with the American Consumer and everything to do with a foreign adversary collecting data of Americans at scale this is this could be
01:22:28
written in a much simpler way it should be one sentence which is that app stores
01:22:33
are prohibited from allowing Tick Tock be an app in their store that's what they do in India that's it Case Closed
01:22:39
game over I think India's doing okay right they block like a hundred Chinese apps and I think their society is still functioning so you know all due respect
01:22:47
to AOC you know like the idea that 150 Americans million Americans are going to suffer because they can't be tracked by
01:22:52
the CCP is kind of nuts this is going to give sweeping powers to the security state to
01:23:00
surveil us to prosecute us to limit our internet usage this is basically the
01:23:06
biggest power grab and bait and switch they've ever tried to pull on us and again if they really were concerned
01:23:11
about Tick Tock it's one sentence yeah we're done all right everybody it's been an amazing episode for the Sultan of
01:23:18
science David freiberg the rain man of soft David sax and the dictator
01:23:24
I am the world's greatest moderator and we will see you next time bye bye [Music]
01:23:39
and they've just gone crazy [Music]
01:24:03
it's like this like sexual tension that they just need to release
01:24:12
[Music] we need to get Mercies
01:24:18
[Music]
