00:00:00
Jason where are you that is that a
00:00:01
virtual background
00:00:03
or oh oh right that's place I I did look
00:00:07
architecturally familiar to me it is
00:00:09
architecturally significant we bleep out
00:00:10
the beep's house but yes I am you know
00:00:13
this is like top three or four of places
00:00:17
I like to be a house guest you know like
00:00:18
I'm in rotation right now my house guest
00:00:20
you're K kining through our friend group
00:00:23
basically you know I'm just a great
00:00:24
house guest people like to have
00:00:25
breakfast with me people like having me
00:00:27
around so I just find myself in I around
00:00:30
the world hey Nick do you have an
00:00:32
updated picture of K kin is he still
00:00:34
alive and kicking he's alive for sure
00:00:36
he's got to be 70 or something right
00:00:38
he's gotta be he was on one of those
00:00:40
reality TV shows with Dr Drew I think a
00:00:42
couple years ago what does k o kin do
00:00:44
he's a good hang he's yeah there's a lot
00:00:46
of these people in La you know like just
00:00:48
they just
00:00:49
hang they kind of
00:00:51
hang they set things up oh my
00:00:54
God is that current k k man he's 64 now
00:01:00
wow God Almighty that's incredible how
00:01:02
did he survive he's got an Instagram
00:01:04
account I'll tell you how he survived
00:01:07
see no evil you're no evil exactly I
00:01:10
didn't see nothing all I know is Hey
00:01:13
listen man you gave you a pool house
00:01:14
snitches get stitches I didn't see
00:01:16
anything what did you see
00:01:19
nothing let your winners
00:01:22
ride Rainman
00:01:26
David and in said we open sources it to
00:01:29
the fans and they've just gone crazy
00:01:31
with love
00:01:31
[Music]
00:01:34
youen all right everybody welcome to
00:01:37
your favorite podcast the Allin podcast
00:01:39
episode 168 David saaks can you believe
00:01:42
it we've made it to 168 episodes with me
00:01:46
again the Rainman David Sachs how you
00:01:50
doing buddy good yeah I heard you got a
00:01:53
big talk coming up another speech yeah
00:01:57
yes a talk yes I'm giving a talk all
00:02:00
right get ready for that all of the GOP
00:02:02
fans out there all your saxs fans you
00:02:04
got a big keynote coming from saaks next
00:02:06
week also with me of course the Sultan
00:02:09
of science formerly known as the queen
00:02:11
of quinoa he's got another crop he's uh
00:02:15
growing David freeberg how are you
00:02:18
doing how's the crops how's the fields
00:02:21
how's life in the fields worth cold open
00:02:24
not a cold do these are intros oh intro
00:02:27
I'm glad you're not producing there's a
00:02:28
reason why I'm the executive producer go
00:02:30
ahead free how's your um how's your
00:02:32
crops how's the how's life in the fields
00:02:34
it's great got a great team making
00:02:37
progress Tech is awesome having a lot of
00:02:39
fun it's great back in the CEO seat
00:02:42
huh and of course the chairman dictator
00:02:45
who's becoming completely insufferable
00:02:47
because he invested in a company seven
00:02:48
years ago that is absolutely crushing
00:02:50
right now called grock we talked about
00:02:52
it last week you're back you're back
00:02:54
chth everybody's talking about Gro
00:02:57
you're you're on uh Cloud 9 seem gr gr
00:03:02
gr Bitcoin Bitcoin Bitcoin groc
00:03:05
gr I mean it is interesting how your
00:03:10
book just literally whatever chat's book
00:03:13
is that's his mood it's just Bitcoin 60
00:03:17
grock well the honesty level is going to
00:03:20
be through the roof now oh right he
00:03:24
going to be running for governor and
00:03:25
buying the Hamptons again the truth
00:03:27
bombs that jamath is going to drop now
00:03:29
there is nothing like Peak Zer jth I
00:03:32
mean are we going back is are we back
00:03:35
right now I on paper what is your stake
00:03:37
and grock already worth let we're not
00:03:39
talking we're not we're not we're not
00:03:40
talking that's so un it's so UNC but
00:03:42
he's buying the Hamptons and he's
00:03:44
probably gonna
00:03:45
buy stop what has it been uncouth on
00:03:48
this podcast to talk about about wins or
00:03:51
wins or
00:03:53
assets these are not I agree with that
00:03:55
it's not a win you can never count you
00:03:56
can never count your chickens before
00:03:58
they hatch that's absolutely right I am
00:03:59
not counting any chickens don't book The
00:04:01
win yes there's a lot of hard work to do
00:04:04
there's a lot more people to sell
00:04:07
products to to build products by the way
00:04:09
developers by the way on Gro just this
00:04:11
past
00:04:13
week in the queue the weight list
00:04:16
tripled now there's almost 10,000
00:04:19
developers that's a big deal well that's
00:04:22
crazy that's a great sign I think the
00:04:24
most important Northstar metric for
00:04:25
these developer platforms is basically
00:04:27
that as goes the developers so goes the
00:04:30
platform you can kind of count on some
00:04:33
amount of pull through because some of
00:04:34
those developers just statistically will
00:04:35
land really important products they'll
00:04:37
consume more apis they'll just consume
00:04:40
more stuff it's just all goodness
00:04:42
because if you have 9,000 or 10,000
00:04:44
people just again waiting in line once
00:04:48
those guys get in somebody's going to
00:04:50
create something
00:04:51
magical that's the great part of having
00:04:53
a platform people just take it and they
00:04:56
build on it while you're sleeping
00:04:58
something amazing can just get built and
00:05:01
you get some amount of the uh credit for
00:05:03
that the thing that's really interesting
00:05:05
is the number of developers is
00:05:06
increasing I've seen two or three
00:05:08
founders recently just the last couple
00:05:10
of weeks who were previously idea
00:05:12
Founders who are now have taught
00:05:14
themselves to code so you know this
00:05:16
there's 1% of the you whatever number of
00:05:19
millions of delers in the world I think
00:05:20
it's going to like double or triple so
00:05:21
the the pool of people who are writing
00:05:23
code I think is about to grow very
00:05:26
meaningfully I mean you guys you guys
00:05:28
saw the release from the White House so
00:05:29
they were like we we don't want you to
00:05:32
code and C at C++
00:05:34
anymore yeah that was very interesting I
00:05:36
mean they were talking about memory
00:05:37
leaks and like this is I guess the
00:05:39
source of most memory leaks therefore
00:05:40
the White House wants you to learn to
00:05:42
develop in memory safe languages oh
00:05:44
great awesome yeah so why are they
00:05:46
involving themselves like they got
00:05:48
nothing better to do yeah I mean they
00:05:51
have an opinion on uh you know
00:05:53
preventing security leads all right
00:05:55
listen the top issue this week is the
00:05:57
same issue as last week Google's Gemini
00:05:59
I Dei black eye continues we covered
00:06:03
this woke AI disaster last week was kind
00:06:06
of funny I was watching CNBC and they
00:06:08
had a hard time describing the problem
00:06:11
the woman just I guess didn't want to
00:06:12
call it what it is it's a racist AI you
00:06:15
type in text and it gives you the
00:06:18
opposite or just culturally insane
00:06:21
responses so if you put in you want a
00:06:23
picture of George Washington from
00:06:24
Google's gemini or Sergey Bren you might
00:06:27
get back like a beniton style diversity
00:06:29
with like George Washington being black
00:06:31
or Sergey Bren being Asian Etc and so
00:06:36
this has caused um a bit of a gr fluffle
00:06:39
here in the industry to say the least
00:06:40
the stock is down 5% since we talked
00:06:42
about it last week and uh Sundar sent a
00:06:45
memo to the Gemini team of course when
00:06:48
they write these memos to a team it's
00:06:49
written to the entire world because you
00:06:51
know it's going to get leaked and so
00:06:52
you're writing as a such it might as
00:06:54
well be a press release I'll give uh two
00:06:56
quick quotes here and then I'll throw it
00:06:57
to the besties because there's so many
00:06:59
questions that we have to address quote
00:07:00
number one I know that some of its
00:07:03
responses referring to Gemini have
00:07:04
offended our users and shown bias to be
00:07:07
clear that's completely unacceptable and
00:07:09
we got it wrong and to be clear it
00:07:11
wouldn't show white people especially
00:07:13
ones like George Washington or just
00:07:15
somebody who is obviously a Caucasian
00:07:18
and so the next quote will be driving a
00:07:21
clear set of actions including
00:07:23
structural changes to me structural
00:07:25
changes means we're going to lay off a
00:07:28
bunch of people and we're going to get
00:07:29
rid of the Dei group that's that's a new
00:07:31
ma that's a new found motivational riff
00:07:34
quote in my mind freeberg will Sundar
00:07:38
survive and is Google too broken to fix
00:07:42
I'm just going to ask you since you work
00:07:43
there I don't want mean to make it
00:07:44
uncomfortable but what are the chances
00:07:46
Sundar survives this and what are the
00:07:49
chances that Google can be fixed and
00:07:51
produce great
00:07:53
products quickly that to light
00:07:57
users I don't know how answer the sunart
00:08:00
Will Survive because it's kind of an
00:08:01
idiosyncratic organization there
00:08:04
are a couple of Founders who have super
00:08:07
voting shares um and ultimately comes
00:08:11
down to their decision and the direction
00:08:14
they want to take the company and I have
00:08:15
no insights into what they individually
00:08:19
think so um frankly I've spoken to a lot
00:08:24
of folks who are investors in Google
00:08:25
over the last week and a lot of folks
00:08:27
are just deeply frustrated and angry um
00:08:31
uh on a number of fronts
00:08:34
the
00:08:36
business really there's you know three
00:08:38
businesses inside of Google there's you
00:08:40
know search and ads there's YouTube and
00:08:42
there's cloud and the rest of it is kind
00:08:43
of noise and to give you a sense of how
00:08:46
big these businesses are right YouTube
00:08:47
did 10 billion a quarter roughly Cloud
00:08:49
did 10 billion a quarter they have this
00:08:51
devices business and subscriptions
00:08:53
business does about 10 billion a quarter
00:08:56
and then search does about 50 billion a
00:08:57
quarter and the margin on search is much
00:08:59
higher than any of those other
00:09:01
businesses and so the search margin the
00:09:03
ad revenue on
00:09:04
search is you know probably 100% of the
00:09:08
true operating profit of the business so
00:09:10
the real threat to Google is more are
00:09:14
they in a position to maintain their
00:09:16
search Monopoly or maintain the chunk of
00:09:19
profits that that drive the business
00:09:22
under the threat of AI are they adapting
00:09:24
and less so about the anger around woke
00:09:26
and Dei because most of the investors I
00:09:28
spoke with aren't angry about the woke
00:09:30
Dei search engine they're angry about
00:09:32
the fact that such a blunder happened
00:09:34
and that it indicates that Google may
00:09:36
not be able to compete effectively and
00:09:38
isn't organized to compete effectively
00:09:39
in AI just from a consumer
00:09:41
competitiveness perspective so you know
00:09:44
investors are banging the table and in
00:09:46
the past we saw this with meta I think
00:09:50
it was towards the end of 22 if you guys
00:09:53
remember and it was a similar situation
00:09:55
investors were like why are you
00:09:56
investing in VR and AR this is crazy why
00:09:58
do you have all the these people that
00:10:00
are getting overpaid and everyone
00:10:02
started to write off the stock and the
00:10:03
stock took a big nose dive for a period
00:10:05
of time just like Google's is right now
00:10:07
and then the changes came and much like
00:10:09
Google there's an individual with super
00:10:11
voting shares who basically said you
00:10:13
know what I am going to step in and
00:10:15
we're going to make these changes and
00:10:16
we're going to fix this organization and
00:10:18
we're going to right siiz and we're
00:10:19
going to focus on the product winning
00:10:21
and since then meta stock is up a
00:10:24
tremendous amount 5x since then Google
00:10:26
Shares are down about 10% over the past
00:10:28
two weeks by the way I was one of the
00:10:29
stupid people to sell meta around that
00:10:31
time and your thinking was that they
00:10:33
just can't get out of their own way and
00:10:35
the god king is it's it's another yeah
00:10:37
it's exactly it's another one of these
00:10:38
idiosyncratic problems you don't know
00:10:40
what this individual is thinking and
00:10:42
what he is individually going to do the
00:10:44
point I'm making is that at Google Now
00:10:46
something has to give because the noise
00:10:48
is so loud the board is hearing this
00:10:51
left and right investors are banging the
00:10:54
table analysts are banging the table and
00:10:56
I I'll tell you a couple anecdotes
00:10:58
internally employees are now banging the
00:10:59
table a story I a story I heard this
00:11:02
week was that someone stood up in a
00:11:04
meeting and said a couple of weeks ago
00:11:07
if I had stood up in this meeting and
00:11:09
said we can't show black people in the
00:11:13
image generation at the rate that we're
00:11:15
showing I would have been cast a racist
00:11:18
and I didn't have permission to do that
00:11:20
inside of the organization but today and
00:11:22
everyone's like you're right you would
00:11:23
not have been able to stand up in the
00:11:24
organization and say that but the tenor
00:11:26
has changed inside of Google with a lot
00:11:28
of the employ that I've spoken with who
00:11:29
are now saying I can stand up and I can
00:11:33
say that this group called responsible
00:11:35
AI has too much power and it's a
00:11:38
one-sided asynchronous problem where
00:11:40
they get to come in and say we need to
00:11:42
change this and if you step up and
00:11:43
disagree with them you are deemed a
00:11:44
racist you were deemed you know
00:11:48
culturally inappropriate easier to keep
00:11:50
your head down it's easier to keep head
00:11:52
circum understand and and keep
00:11:53
collecting your RS all of a sudden you
00:11:55
wake up one day and you see the blunder
00:11:56
that happened last week yeah and so now
00:11:58
internally people are waking up and
00:12:00
saying we need to change this and I
00:12:01
heard that that's made its way up to the
00:12:02
higher ranks at Google and they're very
00:12:04
actively you know so there may be a
00:12:06
moment here where Google stock which
00:12:09
currently is trading at just 17 times
00:12:12
2025 consensus earnings which is cheaper
00:12:15
than all the other big tech companies by
00:12:17
far and it's still growing Core Business
00:12:19
is growing cloud is growing 20% search
00:12:21
is growing 15% all these other
00:12:23
businesses YouTube's growing 20% a year
00:12:26
it's a growth business that's very
00:12:28
profitable
00:12:30
and um it's trading at a very cheap
00:12:31
discount so there's you know the bull
00:12:33
case is now's a great time to buy
00:12:35
because it's so cheap and there could be
00:12:37
this moment where you know you see some
00:12:38
of the changes that are needed
00:12:39
internally to get the AI products to
00:12:42
where they need to be to maintain the
00:12:44
lead that is inherent because of C so
00:12:46
that would mean Sachs it would require
00:12:49
because we're using Zuckerberg as an
00:12:50
example we could also bring Twitter and
00:12:52
X into this it would require founder
00:12:54
authority to come in there and make
00:12:56
these changes it would require larryan
00:12:58
Sur who have the super voting chairs to
00:13:00
come in there and say hey this is all
00:13:01
changing enough of this do you think
00:13:04
there's any chance of that happening or
00:13:07
is Google just too broken to fix and
00:13:10
they're going to just lose this
00:13:11
opportunity and it's Microsoft under
00:13:12
Steve bomber missing mobile and
00:13:15
Cloud well to quote Jefferson the tree
00:13:19
of Liberty must be refreshed from time
00:13:20
to time with the blood of patriots and
00:13:23
Tyrant and I think there's something
00:13:24
analogous here I mean you have to if
00:13:27
you're going to refresh this company you
00:13:28
have to go in and you got to go in and
00:13:31
make major Cuts not just to rank and
00:13:32
file but to leadership who doesn't get
00:13:34
it and that's the only way it's going to
00:13:37
get fixed do I think that Larry and
00:13:40
Sergey are going to come in and pull an
00:13:41
Elon and go deep and figure out which
00:13:45
50% or 20% of the company's actually
00:13:48
good and doing their jobs probably not
00:13:51
but is it possible that they could make
00:13:54
a leadership change yeah it's possible
00:13:56
probable I don't know I mean I've heard
00:13:58
that
00:13:59
the company is the way it is because
00:14:00
they like the way it is I mean that
00:14:03
they're part of the problem in effect
00:14:04
they don't see they don't see the
00:14:06
problem or at least they haven't until
00:14:08
now maybe they'll get the wakeup call
00:14:10
what do you think shimar watching while
00:14:12
this happen I think it's basically a
00:14:14
small Cadre of a thousand people that
00:14:17
have built literally the most singular
00:14:20
best business model and Monopoly ever to
00:14:23
be created on the internet and a whole
00:14:26
bunch of other people that have totally
00:14:29
transformed this organization as sack
00:14:31
said
00:14:33
into ability and a platform to reflect
00:14:37
their
00:14:37
views and so I don't not a shareholder
00:14:40
of Google and outside of the tools I use
00:14:44
I don't think I really have much voting
00:14:47
power so I don't and and I have so many
00:14:49
Alternatives now so I actually think
00:14:52
like the I don't really care that much I
00:14:55
guess is the point I think that the
00:14:56
employees should care and the
00:14:58
shareholders should care and they should
00:15:00
come together and vote and I think saak
00:15:02
is right I think the company is the way
00:15:04
it is because they've chosen to be that
00:15:07
way and I think freeberg is right which
00:15:09
is that there's a small group of people
00:15:11
who have been protecting and breathing
00:15:14
life into the single greatest business
00:15:16
ever built ever in the history of
00:15:20
business but now we need to have a
00:15:22
confrontation amongst all of these three
00:15:24
different groups of people and they need
00:15:25
to make some decisions let me put a few
00:15:27
data points
00:15:29
in in play here jcal and this all this
00:15:32
all speaks to the problems being let's
00:15:35
say deliberate as opposed to a glitch or
00:15:37
an accident so first you have sundar's
00:15:40
letter to the company which there was a
00:15:44
very interesting tweet by Lulu Chang
00:15:48
misseri who does coms at Activision and
00:15:51
she writes a Blog called Flack she said
00:15:54
quote the OB she a com's expert just for
00:15:56
the audience she's a comms expert yeah
00:15:57
so she kind of red sundar's letter and
00:16:00
it was scorching she said the ausc lack
00:16:03
of clarity and fundamental failure to
00:16:05
grasp the problem are due to a failure
00:16:08
of leadership a poorly written email is
00:16:09
just the means through which that
00:16:10
failure is
00:16:12
revealed so that was one
00:16:14
reaction Mark andrees had a series of
00:16:17
posts indicating that the AI was
00:16:20
programmed to be this way again it's not
00:16:22
like a bug it's more of a feature and
00:16:25
that it's not an accident this is this
00:16:28
is happening because because companies
00:16:31
wanted to be that they chose to be this
00:16:32
way and in fact he goes further and says
00:16:34
that these companies are lobbying as a
00:16:36
group with great intensity to establish
00:16:38
a government protected cartel to lock in
00:16:41
their shared agenda and corrupt products
00:16:43
for decades to come wow I mean again
00:16:45
that's a really scorching critique here
00:16:49
and then you know the the question I
00:16:51
would ask is who's been fired for this I
00:16:54
mean imagine if I don't know one of
00:16:56
elon's products had a launch that went
00:16:58
this badly do you think no heads would
00:17:02
roll no heads have rolled and so you
00:17:04
have to kind of Wonder well what if it's
00:17:06
a structural issue sex I mean I I I the
00:17:09
point does resonate with me that there
00:17:11
is a group internally and I think it's
00:17:12
called the responsible AI team at Google
00:17:15
and this team's job is to enforce those
00:17:18
principles remember that we brought up
00:17:19
last week that they've defined and so
00:17:21
they go in and they're like well you
00:17:23
know if you just render an image of a
00:17:25
software engineer and all the images are
00:17:27
just white guys in hoods that's
00:17:29
inappropriate because there are plenty
00:17:30
of non-white people you need to
00:17:31
introduce diversity so then the
00:17:33
programmers say okay we'll go ahead and
00:17:35
overweight the model and make sure that
00:17:36
there's diversity and you can't say no
00:17:38
because otherwise you are deemed a
00:17:40
racist so who is the individual that's
00:17:42
responsible given that structural
00:17:44
circumstance that exists within the
00:17:45
organization it's more of a cultural and
00:17:47
structural problem to me than you know
00:17:50
one I guess ultimately there's
00:17:51
leadership that's lacking but actually I
00:17:53
I I agree with that to some degree let
00:17:55
me describe how I think it it works mhm
00:17:58
so what what I've heard about Google is
00:18:00
that every meeting above a certain size
00:18:02
has a Dei person in it I mean literally
00:18:05
so it's kind of like in the days of the
00:18:07
Soviet Union their military the Red Army
00:18:10
would have in every division or unit
00:18:13
there would be you know a commander or
00:18:15
lieutenant and there'd be a commissar
00:18:18
okay and the commander reported up the
00:18:20
chain and the commissar reported to the
00:18:22
party and the commissar would just
00:18:24
quietly take notes in all the meetings
00:18:26
of the unit and if the commissar didn't
00:18:28
like what the lieutenant was doing
00:18:29
Lieutenant would be taken out and shot
00:18:32
okay now that's kind of a dramatic
00:18:34
example but the point is that in every
00:18:36
large meeting at Google you've got this
00:18:39
Dei commissar who's like quietly taking
00:18:41
notes I'll point out that at Google the
00:18:44
only person we can ever remember to get
00:18:46
fired was James Dore who was an engineer
00:18:49
who complained about the political bias
00:18:51
at Google in other words he was a
00:18:54
whistleblower about the very problem
00:18:55
that's now manifested he's the only
00:18:57
person you can think think of to get
00:18:58
fired at Google Google was mocked on the
00:19:01
show Silicon Valley it was called hulie
00:19:03
but remember this yeah they the the
00:19:06
nobody ever got fired because it's a
00:19:08
company where it's impossible to get
00:19:09
fired unless you blow the whistle on the
00:19:11
political problem and I think that if
00:19:13
you're sitting in those meetings W with
00:19:16
a Dei commissar present and you know or
00:19:19
you have suspicions that the AI product
00:19:22
is not working right are you really
00:19:24
going to speak up and risk the fate of a
00:19:26
James Dore of course you're not
00:19:28
right so you're right freeberg that it's
00:19:30
a structural problem that there's
00:19:31
probably a lowgrade fear that's
00:19:35
pervasive through the organization and
00:19:36
no one's willing to say the emperor
00:19:38
wears no clothes the woke Emperor knows
00:19:40
wears no clothes because they don't want
00:19:41
to why stick your neck out you may not
00:19:43
know you're going to get fired but you
00:19:45
know you're a chance three years ago on
00:19:48
Twitter nobody would talk about certain
00:19:50
topics related to Dei because it was in
00:19:52
the aftermath of George Floyd and people
00:19:55
just did not feel comfortable even
00:19:56
calling out something minor that was
00:19:58
unfair no I would say they didn't feel
00:20:00
comfortable until Bill Amman broke the
00:20:02
seal on this just uh like a month ago
00:20:04
where he really went after Dei I mean
00:20:07
because remember the part of the
00:20:09
reaction to bill akman was like wow he's
00:20:11
really going there even though
00:20:12
everyone's saying that like basically
00:20:14
agreed with him and knew that he was
00:20:16
making a correct point but people were
00:20:18
still afraid to like again call out this
00:20:21
this woke
00:20:22
Emperor yeah and the way this works for
00:20:25
people who are not super aware you have
00:20:27
a language model and you know you write
00:20:29
a bunch of code but then there are guard
00:20:30
rails put in and then there are red
00:20:31
teams and people who test it and so at
00:20:34
the very least even if you were trying
00:20:36
to do something with great intent as you
00:20:37
pointed out Friedberg hey you know if we
00:20:39
pull up a doctor it doesn't shouldn't
00:20:41
necessarily always be a white guy there
00:20:43
are other people who are doctors in the
00:20:45
world somebody should have caught it in
00:20:47
testing they probably did Jason and they
00:20:50
didn't report it who wants to report
00:20:52
that problem that's an interesting rub
00:20:54
yeah how guts they didn't miss it they
00:20:57
didn't miss it didn't have the guts to
00:21:00
you have to build a somebody built a
00:21:01
reward model or people a reward model
00:21:04
was built for the reinforcement learning
00:21:07
from all the humans and their feedback
00:21:09
so these decisions were explicit the
00:21:11
question that is that you guys are
00:21:13
framing
00:21:14
is was this though a case where it was
00:21:17
explicitly imposed on people and people
00:21:20
felt a fear of pushing back or did they
00:21:24
just agree and say this is a great
00:21:26
decision and these rewards make ton of
00:21:28
sense and the whole point is that I
00:21:30
think what this is highlighted is that's
00:21:33
the truth that Google needs to figure
00:21:35
out and they need to figure it out
00:21:37
quickly because what is going to happen
00:21:39
now is it's we I know I think we talked
00:21:41
about this a year ago all Google needs
00:21:43
to see is 300 500 basis points of change
00:21:49
and the market cap of this company is
00:21:50
going to get cut in half okay because
00:21:53
there is only one way to go when you
00:21:54
have 92% share of a market and that is
00:21:57
down and so the setup for the stock is
00:22:00
now that people are looking at this
00:22:02
saying okay if I see 92% go to 91 or 90
00:22:07
or 89 that's all that has to happen and
00:22:10
people will say the trend is to 50% and
00:22:13
you will price this company at a
00:22:15
fraction of what it's worth today so I
00:22:17
think it's really critical this is the
00:22:19
moment that the senior leadership that
00:22:21
really understands business can separate
00:22:24
it from politics and decide is this a
00:22:26
thing of fear where there's one Rog
00:22:29
group that's run a muck or is this what
00:22:32
we believe because if it's the ladder
00:22:34
you just got to go with it there's
00:22:35
nothing you can do because you're not
00:22:36
going to replace 300,000 employees or
00:22:38
however many Google has but if it's the
00:22:40
former sax is right you're going to have
00:22:42
to some heads need to roll and they need
00:22:44
to tell the
00:22:45
marketplace that this was a mistake
00:22:47
where a group of Rogue employees got way
00:22:49
out way too much power we were asleep at
00:22:52
the job but now we're awake they're
00:22:54
fired and this is so they have two
00:22:56
choices but in in all of these choices
00:22:59
what I'm telling you on the the
00:23:01
dispassionate Market side is if you see
00:23:04
perplexity or anybody else clip off 50
00:23:07
basis points or 100 basis points of
00:23:09
share and search this thing is going
00:23:12
straight down by 50% by the way unless
00:23:14
Cloud takes off right because the other
00:23:16
hedge that Google has is
00:23:18
gcp and the tooling that they've built
00:23:20
in gcp can enable and support and be
00:23:24
integral to a lot of Alternatives and
00:23:27
competitors to what ultimately might be
00:23:28
searched so I think there's also a play
00:23:30
here in thinking about some of the
00:23:32
hedges that Google has implicitly built
00:23:34
into the business I'll just say one more
00:23:36
thing on this structural point I kind of
00:23:39
thought about this as when I started
00:23:41
speaking to people internally about how
00:23:42
this happened from a product perspective
00:23:44
it felt a lot like when you talk to a
00:23:47
lawyer as you guys know you're making a
00:23:48
business decision and there's some risk
00:23:50
I mean think about Travis building Uber
00:23:53
and the lawyer will say it is illegal
00:23:55
you need a medallion license to do what
00:23:57
you're doing in this City and Travis is
00:23:59
like well you know what I'm going to
00:24:00
take that risk Brian chesky and Airbnb
00:24:02
he said you know what I'm going to take
00:24:03
that risk and the problem is that like a
00:24:05
lawyer's job is to tell you what you
00:24:07
can't do to identify all the Peril of
00:24:10
your of Your Action and then you as an
00:24:13
executive or a business leader or a
00:24:15
manager your job is supposed to be to
00:24:18
take that as one piece of input one
00:24:20
piece of data that you then make the
00:24:22
informed business decision about what's
00:24:24
the right way to build this product
00:24:25
what's the right way to build this
00:24:26
company and I'll take on some risk and I
00:24:28
think one of the challenges structuring
00:24:30
side of Google is that product leaders
00:24:32
and other folks were never enabled to
00:24:35
make the decision that there were these
00:24:37
as saaks pointed out kind of like
00:24:39
policing type organizations that were
00:24:41
allowed to come in and veto things and
00:24:43
the vetoing or make unilateral decisions
00:24:45
and those vetoing on whether it's
00:24:47
waiting or or some you know training
00:24:49
data set or output that ends up killing
00:24:52
the opportunity for the smart business
00:24:54
leader to say that doesn't make sense we
00:24:55
can't do this is where this is where
00:24:57
having founders in the organization
00:24:58
every day changes everything because the
00:25:01
founders would say hey we we're here to
00:25:03
index the world's information we're here
00:25:04
to present the world's information we're
00:25:05
not here to interpret it we're not here
00:25:07
to win hearts and Minds we're not here
00:25:09
for a political agenda but there's a
00:25:11
group of people there who it's apparent
00:25:13
think that they're there to change the
00:25:16
world that Google is a vehicle for them
00:25:18
to make social changes in the world and
00:25:21
you know that's art and there's other
00:25:23
ways to do that and just paradoxically
00:25:25
like Hamilton making the founding
00:25:27
fathers diverse and doing art you know
00:25:30
that can win Tony's in that context you
00:25:32
could win tons of awards and a claim and
00:25:35
and make incredible beautiful art but on
00:25:37
the other side like people are not
00:25:39
looking for Google to do that they're
00:25:41
looking for Google to give them the
00:25:42
answer and the data and then these
00:25:44
people are thinking it's our job to
00:25:45
actually interpret the data for you as
00:25:48
we kind of touched on last week so uh
00:25:51
this I think look I think you guys are
00:25:53
really close to the bullseye here but I
00:25:55
would just refine slightly what you're
00:25:57
saying
00:25:59
so here's how I think it happens I I
00:26:01
don't think this is a rogue group I
00:26:02
actually think this is a highly
00:26:03
empowered group within Google I do agree
00:26:06
with you yeah yeah I think what happens
00:26:08
is Sundar says from the top that we're
00:26:12
going to be on the Forefront of
00:26:13
diversity and inclusion because he
00:26:15
personally believes that and that's the
00:26:17
way the social winds are blowing and
00:26:20
they think it's good for the company on
00:26:21
some level okay to implement that Mantra
00:26:25
or that platitude really HR hires a
00:26:28
bunch of Dei experts okay lots of them I
00:26:30
think the company has like this huge HR
00:26:33
department and a lot of those people are
00:26:36
basically Fanatics I mean they're their
00:26:38
chosen career yeah yeah they're trained
00:26:40
marxists basically and so they're the
00:26:42
commissars and they're sitting in all
00:26:44
these meetings and again they're the
00:26:46
ones taking notes and they're the ones
00:26:48
who push the company in a certain
00:26:49
direction but you have to then go back
00:26:51
to senior leadership and say it's their
00:26:53
fault for letting this happen because
00:26:55
they should have made a course
00:26:56
correction they should have realized
00:26:58
what was happening they should have
00:26:59
realized that through a combination
00:27:03
of bias and through this sort of like
00:27:07
overly
00:27:08
empowered HR team who are pulling a
00:27:11
legal card I mean freeberg is right
00:27:12
about that they're saying that our point
00:27:14
of view is the law which isn't true but
00:27:16
they're basically pulling the legal card
00:27:18
and pushing the whole organization a
00:27:20
certain direction it was up to
00:27:21
leadership to realize what was going on
00:27:24
and make a correction and the the thing
00:27:28
that you're seeing now is that in the
00:27:30
face of what's happened the statement
00:27:33
that we got really doesn't cut it funny
00:27:35
they use the word problematic yeah
00:27:37
exactly they're describing it as a
00:27:39
glitch or a bug it's not it's a much
00:27:40
deeper problem and so therefore you give
00:27:43
it gives no confidence that the solution
00:27:47
is going to be pursued in as
00:27:49
comprehensive manners as necessary yeah
00:27:51
I think it's just a that that memo is a
00:27:53
tip off that there is a 20,000 30,000
00:27:55
person riff and a reorganized and
00:27:58
they're just going to keep cutting the
00:27:59
de group and they've already meta and
00:28:01
Google have cut the DI groups a bit I
00:28:03
don't know if it's about as much about
00:28:05
cutting as much as it is about
00:28:08
empowering if you said to the product
00:28:10
leaders you can make the decision Dei
00:28:14
and responsible Ai and whatever other
00:28:16
groups they're going to inform you on
00:28:18
their point of view but they're not
00:28:20
going to tell you what your point that
00:28:22
diag is pulling the legal card they're
00:28:24
saying this is the law they're saying
00:28:25
that say that's what needs to change
00:28:27
right if you don't do things the way we
00:28:29
tell you Google's going to be hit with a
00:28:31
civil rights lawsuit that's what they're
00:28:32
saying oh well I mean let's see if
00:28:35
leadership can overcome that threat but
00:28:37
I think that's exactly the threat that
00:28:39
is keeping the organization from
00:28:41
resolving this problem or could keep the
00:28:42
organization that but I also wouldn't
00:28:44
underestimate the bias so you know
00:28:47
everybody there not I shouldn't say
00:28:48
everybody but it's a very liberal
00:28:51
culture right it's a monoculture so when
00:28:53
you're swimming in that much bias it's
00:28:54
hard to see right yeah yeah when
00:28:57
everybody is left to Center I mean just
00:28:59
look at something like political
00:29:00
contributions right it's 90s something
00:29:02
per are democratic I mean like high 90s
00:29:06
so it's just a a liberal bubble
00:29:09
basically and so right when everybody's
00:29:11
liberal it's very hard to see when you
00:29:14
know the results are Way offc Center as
00:29:17
well also if you if you give people this
00:29:19
job like how are they what are they
00:29:21
going to do every day freedberg if
00:29:22
they've been given the job Dei and
00:29:24
they've been given the job to do trust
00:29:25
and safety they they're looking to fill
00:29:26
their time in make an impact you got to
00:29:28
I think maybe have less of these people
00:29:30
I honestly think you guys saw you know
00:29:33
Shan Maguire is a partner at seoa and he
00:29:34
used to be a member of the team at
00:29:37
Google Ventures when it was called
00:29:39
Google Ventures and he did a Twitter
00:29:40
post did you guys see this yeah where he
00:29:42
said when he was at Google he was told
00:29:45
by his manager I'm not really supposed
00:29:46
to tell you this it could get me fired
00:29:48
but you're one of the highest performing
00:29:49
people here but I can't promote you
00:29:51
right now because I have a quota my
00:29:53
hands are tied you'll get the next slot
00:29:55
please be patient I'm really sorry It
00:29:57
ultimately LED sea to leave Google and
00:30:00
uh you know the rest is history he's a
00:30:02
partner at seoa now you're saying
00:30:05
because he's a white male because he's a
00:30:07
white male yeah and so the you knowon
00:30:11
yeah no I had the same thing happened to
00:30:12
me on AOL when I was at AOL and shabbath
00:30:14
was there at the same time the whole
00:30:16
organization was white men from Virginia
00:30:20
whatever and they gave me an SVP title
00:30:24
and I said well I want the EVP one and
00:30:25
they're like you know what we can't have
00:30:27
any more white males in that position
00:30:29
right now we have to like get some more
00:30:31
women and people of color in that
00:30:33
position and they told me you'll have
00:30:34
the same comp and bonus but we just
00:30:36
can't give you the title jamat do you
00:30:38
think these
00:30:40
like race and gender driven
00:30:44
quotas make sense for HR departments to
00:30:48
try and enforce upon
00:30:51
managers to M to increase diversity I
00:30:54
mean is that a good objective for an
00:30:55
organization to have this is like a
00:30:57
topic a lot of people I've heard kind of
00:30:58
flip back and forth on I there is no
00:31:01
company where I have majority control
00:31:03
where I have an HR department you don't
00:31:04
have an HR department no say more why I
00:31:07
think that it's very important you
00:31:09
should go to a very respected lawyer at
00:31:11
a thirdparty firm someone very visible
00:31:15
an Eric CER type person and you should
00:31:18
work with that law firm and retain them
00:31:20
so that you have an escape valve if
00:31:23
there
00:31:24
are any kind of serious issues that need
00:31:27
to be escalated so that you can get them
00:31:29
into the hands of a dispassionate third
00:31:32
party person who can then appropriately
00:31:35
inform the board the CEO and investigate
00:31:39
so that that covers sort of all the bad
00:31:41
things that can happen then there are
00:31:43
buckets of I think good things one one
00:31:46
important set of things is around
00:31:48
benefits my perspective is that the team
00:31:52
should build their own benefits package
00:31:54
that they want they should understand
00:31:56
the p&l of the company that they work
00:31:58
for they should be given a budget and in
00:32:01
in my companies again what I do is I
00:32:03
allow committees to form and I ask those
00:32:05
committees to be diverse but what I mean
00:32:09
by diverse is I want somebody who has a
00:32:12
sick partner I want somebody who has a
00:32:16
family I want somebody who's young and
00:32:18
single so that the diversity of benefits
00:32:20
reflects what all these people need they
00:32:22
go and talk to folks they come back and
00:32:24
they choose on behalf of the whole
00:32:26
company and there's a voting mechanism
00:32:28
then when it comes to hiring I think
00:32:30
what has to happen is that the person
00:32:32
that for whom that person will end up
00:32:34
working for it's the head of engineering
00:32:37
it's the head of sales those are the
00:32:39
people that should be running the hiring
00:32:42
processes I don't like to Outsource it
00:32:44
to recruiters I don't like to Outsource
00:32:46
it to HR so when you strip all of these
00:32:48
jobs away HR doesn't have a role and
00:32:52
what is left over is the very dark part
00:32:54
of HR in most organizations which is the
00:32:56
police person the police policeman right
00:32:58
the what what is Saks call the commiss
00:33:01
that is why everybody hates HR I've
00:33:03
never met a company where that is a
00:33:05
successful role over long periods of
00:33:08
time they are this conflict creating
00:33:11
entity inside of an organization that
00:33:13
slows organizations down
00:33:15
so that allows me to empower individuals
00:33:19
to actually design the benefits that
00:33:20
they want to hire the team that they
00:33:22
want and I let them understand the p&l
00:33:25
in a very clear transparent way and the
00:33:27
results are what the results are you
00:33:28
want more bonuses hire better people and
00:33:31
then what I do is at the end of every
00:33:32
year I talk about this distribution of
00:33:35
talent and I make sure we are
00:33:37
identifying the bottom five or 10% they
00:33:40
need to be managed up or they must be
00:33:44
fired every year and it does not matter
00:33:47
how big the company is you must manage
00:33:50
up or out the bottom 5 to 10% and in
00:33:53
some cases I'm talking about one person
00:33:54
because it's a small company and in
00:33:56
other cases I'm talking about 30 or 40
00:33:58
people so just hire the best person for
00:34:00
the job no you eliminate HR yeah you
00:34:03
empower the team make the make allow
00:34:05
them to make their own
00:34:07
decisions measure it hold them
00:34:09
accountable right so if you have a
00:34:12
salesperson who just hires their I don't
00:34:15
know 15 sorority sisters or fraternity
00:34:17
Brothers whatever it is and it just
00:34:18
becomes not a diverse group well hold on
00:34:22
it is what it is that still may be
00:34:23
diverse this is my point like the the
00:34:25
thing is that like there's different
00:34:27
ways to sell there's different sales
00:34:29
motions there's the sort of like
00:34:31
elephant hunting kind of sales model
00:34:33
there's the Dialing for Dollars thing so
00:34:35
even those 15 sorority sisters the way
00:34:37
you describe it could actually be
00:34:38
diverse my point is that kind of
00:34:41
superficial marking based on the mutable
00:34:43
traits will not yield a great
00:34:45
organization instead it's you're
00:34:46
empowered to hire whomever you want just
00:34:49
know that at the end of the year we're
00:34:50
going to measure them your bonus their
00:34:52
bonus the company's performance all
00:34:54
performance yeah performance I mean
00:34:56
Frank slutman said this and he he got
00:34:58
barbecued at some point he said I don't
00:35:00
have time to do this diversity stuff the
00:35:03
best person by the way in in my
00:35:04
companies like for example like when you
00:35:05
do sock 2 compliance you have to
00:35:07
generate these reports okay especially
00:35:10
for some of our customers some of our
00:35:11
companies that actually show the
00:35:13
diversity of our team and when we
00:35:16
measure them on the immutable traits
00:35:19
that whatever they represent as their
00:35:21
gender whatever they represent as other
00:35:24
dimensions we are incredibly incredibly
00:35:27
diverse
00:35:28
anyways but the way I've seen a startup
00:35:31
that isn't diverse you know Silicon
00:35:33
Valley attracts such a diverse mix of
00:35:37
people you know what do we know about
00:35:39
success factors for startups number one
00:35:42
the ones that are successful have a
00:35:43
cultural meritocracy number two they're
00:35:46
non-bureaucratic and they don't have too
00:35:48
much GNA basically overhead in the
00:35:52
company now all those things are cont
00:35:56
contradicted by having a large HR team
00:35:59
or especially a Dei organization right
00:36:02
they add bureaucracy they add overhead
00:36:05
and what's that Pips performance
00:36:09
Improvement they cut into well Pips are
00:36:11
great I pip people all the time does it
00:36:13
work I mean I I know some people are
00:36:15
just like these Pips don't work if
00:36:16
you're an unper performing member of the
00:36:17
team and you've been identified in the
00:36:19
bottom five or 10 percent we have a
00:36:21
responsibility as management to coach
00:36:23
you up or to get you to an organization
00:36:26
where you're not in the bottom 5 or 10%
00:36:28
that's the right thing to do for people
00:36:30
you do that by being very transparent
00:36:32
and writing it down you are not good at
00:36:34
these things you're underperforming in
00:36:36
these things fix them or you will not be
00:36:38
here that's a very fair thing to tell
00:36:41
somebody yeah look how you want to
00:36:42
implement your own meritocracy I think
00:36:44
there's different ways for Founders to
00:36:46
do that the point is you want these
00:36:47
companies to be a meritocracy you don't
00:36:50
want advancement in the company to be
00:36:52
based on factors other than skill Merit
00:36:55
hard work things like that we know
00:36:57
performance we know that's a bad bad
00:36:59
path to go on I think a lot of Founders
00:37:01
don't understand that Dei is not
00:37:04
something they have to do they don't
00:37:05
have to have a Dei organization this has
00:37:08
somehow become a thing it's it's not
00:37:11
required and I think people are
00:37:13
realizing like why would you do that why
00:37:15
would you create this large bureaucracy
00:37:16
in the company that undercuts the
00:37:19
meritocracy that adds a lot of costs and
00:37:22
that slows you down none of those things
00:37:24
will help your company what you need to
00:37:25
have I think J laid out some really good
00:37:28
best practices you should have an
00:37:30
outside Law Firm that I would say is you
00:37:33
could call it HR law but I would just
00:37:35
call it employment law I would say like
00:37:37
a non-ideological
00:37:38
partner e an expert in employment law
00:37:41
who sets up your company correctly and
00:37:43
to whom you can take a complaint if if
00:37:46
an HR complaint gets raised through the
00:37:48
chain of your company you do have to
00:37:49
take it very seriously and that's be a
00:37:51
proper investigation and that's probably
00:37:53
best handled by an outside lawyer so get
00:37:56
that out lawyer and then by the way
00:37:58
always there's never a case where your
00:38:00
coworker should know the intimate
00:38:02
details of any of those and that's what
00:38:04
also creates this horribly rotten
00:38:07
culture in HR where these people act
00:38:09
like Gatekeepers of secret information
00:38:12
salary information bonus information and
00:38:15
then all of the other things oh you know
00:38:17
did you know this person did this with
00:38:20
it's terrible to have that inside of a
00:38:21
company it should go to a dispassionate
00:38:23
third party person whose job it is to
00:38:25
maintain confidential it and discretion
00:38:27
yeah while investigating the truth yeah
00:38:30
when HR is too powerful in a company
00:38:32
that's a red flag at the end of the day
00:38:33
HR should be an administrative function
00:38:35
their job should be to get people on
00:38:38
boarded sign their offer letter and
00:38:40
their confidentiality and uh invention
00:38:43
an assignment agreement and set them up
00:38:45
in payroll and get them benefits and
00:38:47
that kind of stuff it should
00:38:48
fundamentally be an administrative
00:38:50
function and if it starts getting more
00:38:53
powerful than that it means there's been
00:38:55
a usurpation you don't even need people
00:38:57
for that like you have software that
00:38:59
does that now and it's all automated you
00:39:01
know you send them a link you go to your
00:39:02
favorite you know HR site boom it's done
00:39:05
yeah I don't think you need a lot of
00:39:06
people doing this anything you want to
00:39:07
add to this discussion freeberg as we as
00:39:09
we move on to the next topic I think
00:39:10
that unfortunately the term
00:39:13
diversity Equity inclusion has been
00:39:16
captured along as chth points out a
00:39:19
single Vector which is this immutable
00:39:21
trait of your racial Identity or gender
00:39:25
and I think the more important aspect
00:39:28
for the success of a team for the
00:39:29
success of an organization is to find
00:39:32
diversity in the people that comes from
00:39:34
different backgrounds different
00:39:36
experiences different ways of
00:39:38
thinking and so I I'm not a huge fan of
00:39:42
race-based
00:39:44
metrics or gender based metrics driving
00:39:46
I'm
00:39:47
generally more oriented around be blind
00:39:50
to those those those variables and focus
00:39:53
much more on the variables that can
00:39:55
actually influence the outcome of your
00:39:56
organization yeah one of the great
00:39:59
paradoxes of this as well is we are
00:40:01
moving to a much more Multicultural
00:40:04
mixed race Society anyway people filling
00:40:06
out fors a lot of our kids you know are
00:40:09
are could pick two or three of the
00:40:10
different boxes on a Dei form it's it's
00:40:12
not going to make much of a difference
00:40:14
in the coming decades all right issue
00:40:16
two Google go splashy cach AES licensing
00:40:18
deals for training data and it's now
00:40:21
becoming a bit of a pattern Google we
00:40:23
talked about I think just last week had
00:40:26
to deal with Reddit for $60 million
00:40:29
that's reportedly per year today stack
00:40:33
Overflow is now using its overflow API
00:40:36
to train Gemini no word on the contract
00:40:38
value I did get some back channel that
00:40:41
it's a multi-year non-exclusive deal
00:40:43
according to R's S1 they have already
00:40:45
closed 200 million worth of AI licensing
00:40:47
deals over the next two to three years
00:40:49
so you maybe it's going to be 75 million
00:40:51
a year 100 million a year who knows how
00:40:53
big that business can get we're going to
00:40:54
talk about the S1 from Reddit in just a
00:40:58
moment and uh this is on top of all the
00:41:00
other licensing deals that have occurred
00:41:02
AEL Springer in open AI you remember
00:41:03
that one and opening eyes and talks
00:41:06
reportedly with CNN Fox and time to
00:41:09
license their content that comes on the
00:41:11
hills of that Blockbuster New York Times
00:41:13
open AI lawsuit that we talked about I
00:41:15
don't know 10 episodes ago and open AI
00:41:17
lawyers are trying to get that one just
00:41:18
to give you a little update on it
00:41:19
they're trying to get that case
00:41:20
dismissed saying that the New York Times
00:41:22
hacked chat GPT to get certain results
00:41:25
and that the York Times took tens of
00:41:27
thousands of tries to generate the
00:41:29
results yada yada and they said here's
00:41:31
the quote from the filing from open AI
00:41:33
the allegations in the times complaint
00:41:35
do not meet its famously rigorous
00:41:38
journalistic standards both open Ai and
00:41:40
Google and Gemini have been fly Guard
00:41:42
railing their systems as we talked about
00:41:44
as well to stop copyright infringement
00:41:47
like trying to make pictures of Darth
00:41:48
Vader and that kind of stuff Jam you've
00:41:50
talked a little bit about your Tac 2.0
00:41:52
framework maybe you could talk about
00:41:54
what you see Happening Here with all
00:41:55
these licensing deals and what it means
00:41:58
for startups in the AI
00:42:01
space well just to maybe catch everybody
00:42:03
up Tac is this thing called traffic
00:42:06
acquisition cost and you can see it most
00:42:09
importantly in
00:42:11
Google's quarterly releases which is
00:42:13
that what they realized very early on at
00:42:16
the beginning of the search wars in the
00:42:19
early 2000s is that they could pay
00:42:21
people to offer Google search people
00:42:25
would use it and then it would generate
00:42:26
so much money that they could give them
00:42:28
a huge ref share and it would still make
00:42:30
money so I remember Jason when you and I
00:42:32
were at AOL this is the first time I met
00:42:34
Omid we were flying back to California
00:42:37
we were both in Dallas at the same time
00:42:39
in like
00:42:40
2003 or four and that's when Omid did
00:42:44
the first big search deal between AOL
00:42:46
and Google and it was it was I want to
00:42:48
say hundreds of millions of dollars back
00:42:50
then where Google pays you up front you
00:42:53
have to Syndicate Google search and then
00:42:55
they clean it up on the back end with
00:42:57
some kind of rure so what's incredible
00:43:00
is that that process has escalated to a
00:43:03
point now where for example on the
00:43:05
iPhone it's somewhere between 18 and 20
00:43:08
odd billion dollars a year is what now
00:43:10
Google pays Apple so that's the traffic
00:43:13
acquisition cost 1.0 R Tac
00:43:16
1.0 and I just said that we should call
00:43:19
this Tac 2.0 except now what Google is
00:43:22
doing is instead of paying for search
00:43:24
they're actually paying for your data
00:43:26
and saying give it to me so that I can
00:43:27
train my models and make it better and I
00:43:29
think that that's an incredible thing
00:43:31
both it's very smart for Google but also
00:43:34
it's great for these businesses because
00:43:36
it's an extremely high
00:43:38
margin thing to do when you have a
00:43:41
really good Corpus of of data that is
00:43:43
very unique so in the case of Reddit
00:43:45
that $60 million deal I didn't I I
00:43:47
looked through the S1 to try to figure
00:43:49
out whether it was a multi- your deal or
00:43:50
not it wasn't totally clear but the
00:43:54
point is that you know Google's paying
00:43:56
Reddit 60 million bucks and Jason you
00:43:57
just said that they're they've done a
00:43:59
couple more of these things that's
00:44:01
incredible this Tac 2.0 thing is amazing
00:44:04
so if you're an entrepreneur building a
00:44:06
website or building an app that has
00:44:08
really unique training data or really
00:44:10
unique data you'll be able to license
00:44:12
and sell that and that'll be an
00:44:14
incremental Revenue stream to everything
00:44:15
you do in the near future that's amazing
00:44:17
that's what T 2.0 is it's going to be
00:44:19
incredible for the entire uh content and
00:44:22
community- based Industries you think
00:44:23
this could sustain content creation
00:44:25
where advertising has become very
00:44:27
difficult sax I guess my question to
00:44:29
toal would be do you think this is going
00:44:31
to be available to small websites
00:44:34
they'll somehow be some sort of program
00:44:36
or because I mean Reddit is one of the
00:44:37
biggest sources of content on the entire
00:44:39
web right it's like a top five traffic
00:44:41
site with tons and tons of user
00:44:44
generated content yes do you think like
00:44:46
a small publication would be able to
00:44:48
make these types of deals yeah and in
00:44:50
fact I think like if you go back to
00:44:51
search 1.0 that's exactly what these
00:44:53
small companies were able to do which
00:44:55
was in a more automated way they were
00:44:57
able to basically partner and in that
00:44:59
example what they would say is here
00:45:01
Google why don't you just run your ads
00:45:03
on our page right and that was sort of
00:45:05
in that web 1.0 world so Google had
00:45:07
solutions for the largest companies on
00:45:10
the internet all the way to the smallest
00:45:12
and in this Tac 2.0 world I do think
00:45:15
that that it works in that way as well
00:45:17
the problem in the in that world if it's
00:45:19
a small website that says here's my
00:45:21
training data the question is how do you
00:45:24
attribute how much incremental value a
00:45:27
model derived from it versus something
00:45:29
else and so I think that that part has
00:45:32
to get figured
00:45:33
out and so you know what Google will be
00:45:36
able to pay you will probably be pretty
00:45:38
di
00:45:41
minimouse bound is 60 million for Reddit
00:45:44
then the average website's going to get
00:45:45
a few hundred
00:45:46
bucks but that still may be a good start
00:45:49
and when Google figures out how to
00:45:50
monetize stuff or somebody else where
00:45:53
then they can give you back some way to
00:45:56
make money I think I think that there's
00:45:57
a
00:45:58
real monetization here I really do you
00:46:02
took the other side of
00:46:04
this but now that you see the
00:46:06
market-based solution starting
00:46:08
to emerge what do you think of this
00:46:10
market-based solution think it's a got
00:46:12
legs well I'm not convinced that this
00:46:16
looks like Tac in the traditional sense
00:46:20
where you're basically buying a
00:46:21
continuous stream of traffic and then
00:46:23
you're helping to monetize that traffic
00:46:25
that's a effectively what Google did in
00:46:27
the ad syndication business and does
00:46:28
today that business makes about 10
00:46:30
billion a quarter at
00:46:32
Google and they're paying call it 70 to
00:46:36
80 cents on every dollar back out to the
00:46:38
owners of that traffic the folks where
00:46:39
that traffic is derived
00:46:41
from I would say that this looks a lot
00:46:44
more like the content licensing deals to
00:46:48
build a proprietary audience which is
00:46:51
effectively what
00:46:52
Netflix did they they paid Studios for
00:46:56
Content Apple does this they have
00:46:59
proprietary content that they pay
00:47:01
producers to make and they put on Apple
00:47:03
TV Amazon does this and so on this is a
00:47:06
lot more like that where there are
00:47:08
content creators out there whether that
00:47:10
content is proprietary like the New York
00:47:12
Times or user generated like Reddit and
00:47:14
what they're trying to do is acquire
00:47:15
that content to build a better product
00:47:17
on Google Search and I'm not sure how
00:47:20
you get paid a continuous licensing
00:47:22
stream for that content once you've
00:47:24
trained the model the content gets old
00:47:26
it gets stale at some point in a lot of
00:47:28
cases like news and then
00:47:30
eventually if you don't have a
00:47:32
highquality continuous stream of content
00:47:35
it's not worth as much anymore to give
00:47:37
you guys a sense humans generate in
00:47:39
total well let me just give you some
00:47:41
stats there's about a million pedabytes
00:47:42
of data on the internet today and humans
00:47:46
are generating about 2500 pedabytes of
00:47:49
data new data uh per day right now
00:47:52
remember I shared a couple weeks ago
00:47:53
YouTube's generating about two pedabytes
00:47:54
of data uh per
00:47:57
day half of all data generated is never
00:48:00
used so this is like records and files
00:48:03
and stuff that gets put on log files log
00:48:05
files gets stored somewhere never
00:48:07
accessed never used the majority of the
00:48:09
rest of that data is not in the public
00:48:11
domain it's not on the internet so there
00:48:13
is a lot of data out there what some
00:48:16
people might call dark data to train on
00:48:19
and I think that as the identification
00:48:22
of better sources of training data and
00:48:25
the value of training data right now
00:48:27
we're in this kind of shotgun approach
00:48:28
we're trying to blast out and you know
00:48:30
Source lots of content lots of data just
00:48:33
like over time Netflix got better at
00:48:35
figuring out what content to buy and
00:48:37
what to pay for it and they're the best
00:48:39
at it I think so too will Google and
00:48:42
others figure out what data is actually
00:48:44
particularly useful what it's worth and
00:48:47
what to pay for it and so there's a lot
00:48:49
of data out there to go and identify to
00:48:51
mine to pay license fees to get access
00:48:54
to whether those are continuous license
00:48:56
fees or one time is still TBD that's a
00:48:58
key issue yeah so I think we're still a
00:49:00
little bit early to know if this is like
00:49:02
you know a continuous model like a tack
00:49:04
type business or if these are sort of
00:49:06
chunky type deals and we don't really
00:49:08
know what the real value is yet and that
00:49:09
all changes over time and remember the
00:49:11
the the rate of data generation is
00:49:14
increasing so while we're generating 200
00:49:16
pedabytes of data per day as a species
00:49:18
on the internet that number is going up
00:49:20
every day and so every year all the old
00:49:23
data becomes worth even less so this is
00:49:25
all changing fairly dynamically and I
00:49:27
think there's a lot still to be figured
00:49:29
out on what the monetization model will
00:49:31
be for Content creators and and how
00:49:33
that's going to change over time yeah I
00:49:35
think it's a really good point some
00:49:36
things will be like The Sopranos or
00:49:38
Seinfeld or Simpsons where that library
00:49:40
is worth fortune and people will pay a
00:49:42
billion dollars a half billion dollars
00:49:44
some no one no one's no one's paying a
00:49:45
lot for old NFL games you know Nick
00:49:47
founded by the way Reddit licensing deal
00:49:49
was 203 million over it says 2 to three
00:49:53
years so let's assume it's call it three
00:49:55
just to be so it's you know6 million a
00:49:58
year it doesn't say whether the deal
00:50:00
with Google is exclusive wow so they
00:50:02
could do they could do that same licing
00:50:03
deal multiple times that's interesting
00:50:05
yeah none of these are exclusive it
00:50:06
seems this is what I don't understand
00:50:08
why why don't you do head deals like
00:50:10
with folks like Reddit where you
00:50:12
actually do it exclusively like it seems
00:50:14
like it's more valuable to spend a
00:50:16
multiple of this number for for one of
00:50:19
the big seven who have tens of billions
00:50:21
of dollars of cash anyways and block the
00:50:23
other players and block everybody else
00:50:25
that just seems Reddit multiple gets
00:50:26
capped if I'm Reddit I don't want to do
00:50:27
that deal yeah Reddit me I put it on the
00:50:29
table Yeah because then my multiple is
00:50:31
Capp like the the way I can monetize my
00:50:33
content is now set and I'm done inv get
00:50:36
bought investors are like oh you're
00:50:37
worth five times eai you know that's it
00:50:40
Reddit cor stack Overflow they're going
00:50:42
to just get taken out I this is I think
00:50:43
this is going to be the new mod did
00:50:45
around actually didn't cor raise uh 50
00:50:47
500 recently I think they're going to
00:50:49
get taken out I I I I think these
00:50:51
businesses will become too valuable
00:50:52
because they do have ongoing content
00:50:54
that
00:50:56
used to run you started web blogs
00:50:59
right and but think about the value of
00:51:01
that content today it's negligible like
00:51:03
it was very valuable at the time and as
00:51:06
time went on more content was being
00:51:07
created a 100 times a thousand times
00:51:09
10,000 times more content that started
00:51:12
to overshadow the value of that content
00:51:13
at the time the acquisition was done it
00:51:15
made a ton of sense but all of a sudden
00:51:17
two years later particularly with the
00:51:18
rate at which data is growing on the
00:51:20
Internet it's like does it make sense to
00:51:22
buy any content anymore so you well on
00:51:24
the other side of that is historical
00:51:26
content could be worth a lot of money
00:51:28
especially some could be so if you had
00:51:30
the Charlie Rose archive as an example
00:51:32
what is you know he's probably
00:51:33
interviewed Kissinger 10 times and he's
00:51:35
interviewed Kissinger for you know 10
00:51:37
hours I've got two almost 2,000 episodes
00:51:39
of podcasts I've done with startups over
00:51:42
13 years like yeah this weekend startups
00:51:45
archive is going to be worth something
00:51:46
at some point right I don't think it's
00:51:47
worth what are old baseball games Worth
00:51:49
right like I mean yeah they're
00:51:52
rewatchable and I don't think the data
00:51:54
from them is particularly important so I
00:51:56
I agree on that one but historical yeah
00:51:59
we don't know but and I just question
00:52:00
how much of reddit's content is actually
00:52:02
like long-term valuable versus like
00:52:05
they're covering a topic and they're
00:52:06
talking about interesting stuff and
00:52:08
then later it's a really really
00:52:10
excellent point yeah and we'll figure
00:52:13
that out okay and that's why I think
00:52:14
it's like it's the early days of knowing
00:52:15
how to Value all this content
00:52:16
particularly for llms and so we don't
00:52:18
really know yet over the next year this
00:52:20
will all start to become clearer but
00:52:22
it's it's again same thing happened in
00:52:24
music licensing yeah right but if if all
00:52:26
the content creators could kind of
00:52:28
unionize then it might increase that's
00:52:32
kind of like the yeah like music music
00:52:34
industry has ASAP socialist I love it
00:52:37
well I'm not I'm not advocating for this
00:52:39
but the point I'm making is if they
00:52:40
can't unionize then there's a lot
00:52:43
there's just a huge number of vendors of
00:52:46
content and so models will need to buy
00:52:49
some but as long as they can get some
00:52:50
they don't need to have all and
00:52:52
therefore it's basically highly
00:52:54
competitive among suppliers and there's
00:52:56
a very limited number of buyers so that
00:52:59
tends this is why the news industry
00:53:00
should have always had a federation
00:53:01
because they could have just said to
00:53:03
Google hey we're going to de-index
00:53:05
ourselves from the Google search engine
00:53:07
and so you won't have the New York Times
00:53:08
Washington Post LA Times you're just not
00:53:10
going to have any of us unless you give
00:53:11
us X Y and Z and they were just too
00:53:14
stupid and not coordinated to do it yeah
00:53:17
music industry the exact opposite you
00:53:19
you try to do anything with the music
00:53:20
industry they're going to come down on
00:53:22
you like a ton of bricks to this day I
00:53:24
see what
00:53:25
that's actually really interesting yeah
00:53:27
if all the um old school Legacy
00:53:30
newspapers and magazines magazin so on
00:53:34
basically formed their own whatever Cel
00:53:38
trade Association yeah that would have
00:53:39
been powerful yeah I mean that's what
00:53:41
Murdoch wanted Murdoch saw it clearly he
00:53:43
was like you know Google's the enemy
00:53:45
here they're going to take all of our
00:53:46
revenue and they're going to get all our
00:53:47
customer names and we're not going to
00:53:48
even know the names of our customers all
00:53:50
right issue three clowner crushes
00:53:51
customer queries with AI you may have
00:53:53
seen this trending on X and Twitter and
00:53:55
in the Press if you don't know Clara
00:53:57
they're a Swedish ftech company they do
00:53:59
that buy now pay later stuff I think
00:54:00
they were The Originators of that online
00:54:03
and they put out a press release with
00:54:04
some really eye popping claims AI
00:54:07
assistants are now doing the work of 700
00:54:10
full-time agents at CL they moved issue
00:54:14
resolving times from 11 minutes with
00:54:16
humans to 2 minutes with
00:54:19
AI and customer satisfaction is on par
00:54:22
with human
00:54:23
agents and it said it's resol ions are
00:54:25
more accurate than humans creating a 25%
00:54:27
drop in repeat inquiries that tracks and
00:54:30
so far their AI which they built with
00:54:33
open AI has had 2.3 million
00:54:35
conversations accounting for 2third of
00:54:37
cler's customer support service chats
00:54:40
cler estimates its AI agent will drive
00:54:43
wait for it a $40 million increase in
00:54:46
profits this year we could talk a little
00:54:49
bit more about cloner and their
00:54:50
valuations but freeberg what what do you
00:54:52
think this means if we're in year this
00:54:55
is the start of year two of chat GPT as
00:54:58
like a phenomenon let's say what do we
00:55:01
think year three looks like I think the
00:55:03
tech the techn pessimist point of view
00:55:05
is oh my God look at all these jobs that
00:55:06
are getting lost I think the optimistic
00:55:08
point of view is that that company has
00:55:11
all of that excess Capital now to
00:55:13
reinvest in doing other things that
00:55:15
Capital doesn't just become profits that
00:55:17
flow out the door and everyone's done
00:55:19
with that money and that money just gets
00:55:21
put away in a sock that money gets
00:55:23
reinvested and that money gets
00:55:24
reinvested invested in higher order
00:55:26
functioning work and that's really where
00:55:28
there's an opportunity to move the
00:55:30
workforce overall forward which is what
00:55:32
I think is super exciting and um I'm
00:55:34
super positive about we've seen this in
00:55:36
every technological Evolution that's
00:55:39
happened in human history from you know
00:55:41
the plow in agriculture to automobiles
00:55:44
to Computing and to now ai that you know
00:55:47
humans moved from manual labor to
00:55:50
knowledge work to now ideally and
00:55:52
hopefully more creative work and so I do
00:55:55
think that it isn't just about
00:55:57
eliminating jobs and making more money
00:55:59
but it's about enabling the creation of
00:56:01
entirely new class of work whether
00:56:03
that's prompt
00:56:04
engineering or you know building
00:56:06
entirely new businesses that simply
00:56:07
can't exist today or perhaps even
00:56:09
downscaling businesses where you no
00:56:11
longer need to have a 10,000 person
00:56:12
organization smaller organizations can
00:56:15
be stood up as startups to start to
00:56:17
replace large functioning organizations
00:56:18
so I don't know I think it's a time of
00:56:20
great opportunity I know that some
00:56:21
people would view it as being highly
00:56:23
shocking I think it's inevitable that
00:56:25
knowledge labor where the job of the
00:56:26
human is simply the ingestion of data
00:56:28
and then communicate an output of data
00:56:31
seems like it will eventually be
00:56:32
replaced by Computing somehow and this
00:56:34
is happening now in an accelerated way
00:56:36
with these llms so I think that what we
00:56:38
should focus on and think about is what
00:56:41
are all the new businesses all the new
00:56:42
jobs all the new opportunities that are
00:56:44
just couldn't have existed 10 years ago
00:56:46
that are now emerging that are very
00:56:47
exciting as the workforce transitions
00:56:50
sacked You by this techno utopian view
00:56:52
of this all these jobs that are going to
00:56:55
obviously be retired are going to open
00:56:58
up the opportunity for these humans to
00:57:00
do even better work at clana or do you
00:57:02
think it's just going to go straight to
00:57:04
the bottom
00:57:05
line well it sounds like they're able to
00:57:08
eliminate a lot of Frontline customer
00:57:10
support roles by using AI which is what
00:57:13
I would expect yeah I think this is a
00:57:15
very natural application for AI you know
00:57:19
it was already the case that you could
00:57:21
pretty much find answers to questions by
00:57:23
searching the FAQ things like this this
00:57:25
this is an even better way of doing that
00:57:28
so so look I I believe that this will be
00:57:30
a big area for AI is saving on again I
00:57:32
use the word Frontline customer support
00:57:34
because the way that customer support is
00:57:37
typically organized is there's level one
00:57:39
level two level three the more difficult
00:57:43
queries or cases get escalated up the
00:57:45
chain depending on how hard they are and
00:57:47
I think the AI will do a really good job
00:57:49
eliminating level one it'll start to
00:57:51
eating to level two but you're probably
00:57:53
going to
00:57:53
need humans to deal with the more uh
00:57:56
complex cases now the question is where
00:57:59
do those displaced humans go I think
00:58:01
there's going to be new jobs new work
00:58:03
that's always been the history of
00:58:05
technological progress and one of the
00:58:07
things you're already seeing is there's
00:58:08
a whole bunch of new AI companies that
00:58:10
are exploiting this technology and they
00:58:12
need to hire people so I basically agree
00:58:14
with freeberg that you will Elevate
00:58:16
people's work by automating away the
00:58:19
less interesting parts of people's jobs
00:58:21
and then creating more productivity and
00:58:23
more opportunity by the just to use your
00:58:25
just to use your example sacks so
00:58:27
imagine if all the level one support
00:58:29
people some chunk of them can now do
00:58:31
level two support and so the customers
00:58:33
are going to get greater Hands-On care
00:58:35
more customers will get access to a
00:58:37
higher level of service the organization
00:58:39
can afford to do that they'll be more
00:58:41
competitive in the marketplace because
00:58:43
customers feel better taken care of I
00:58:45
just think that's how the organizations
00:58:47
get leveled up as new technology kind of
00:58:49
shows up like this it's a great point
00:58:51
and then those folks can have a much
00:58:52
deeper level of interaction with with
00:58:54
their customers than they are
00:58:56
todaying question gets more complex and
00:58:59
then people might get better at the
00:59:00
software and they might discover new
00:59:02
features that you might be able to
00:59:03
redeploy those people if you look at
00:59:05
coffee like I don't know was it 40 years
00:59:07
ago you went to order a cup of coffee it
00:59:09
was decaf or regular coffee milk and
00:59:11
sugar those are like those are your four
00:59:13
choices and and now you go order coffee
00:59:16
I don't know if you guys have used the
00:59:17
Starbucks app or the you know I just had
00:59:20
the sweet green CEO on the Pod and man
00:59:22
you can the Fidelity and and the Nuance
00:59:25
of what you want to order is absurd Jam
00:59:28
where do you think this is all heading
00:59:30
because there is the issue of
00:59:31
displacement how people how quickly
00:59:33
people can re be redeployed and if we're
00:59:35
seeing in year two customer support and
00:59:39
developers getting 10x what other
00:59:41
categories do you think we're going to
00:59:42
see fall next I think the truth is that
00:59:45
as you said the real world applicability
00:59:47
to AI was not last year so I think we're
00:59:50
really in the first five or six weeks of
00:59:53
the first year
00:59:55
so you consider that year zero that's
00:59:57
year zero that was sort of like the you
00:59:59
know where everybody was running around
01:00:00
building toy apps Pro of concept this is
01:00:03
one of the first few times where you're
01:00:05
seeing something in production where
01:00:06
there's measurable economic value and
01:00:09
the important thing to note about that
01:00:10
is that it's not just what it means for
01:00:12
Clara but what it means for everybody
01:00:13
else so if you look at everybody else
01:00:15
for example here's Teleperformance which
01:00:17
is a a French company that runs call
01:00:20
centers they lost $1.7 billion of market
01:00:23
cap when that tweak went out about 20%
01:00:26
of their market cap so this is this is
01:00:28
the real practical implication Yes Clara
01:00:31
replaced 700 people and they saved 40
01:00:34
million of Opex but teleport 4 months
01:00:38
while they were just doing their
01:00:39
everyday work lost 1.8 billion of their
01:00:42
market cap at the exact same moment and
01:00:45
so what does it
01:00:47
mean I think that what Clara should do
01:00:50
is open source what they've built and
01:00:54
the reason is that you want to give
01:00:56
companies like
01:00:58
Teleperformance a chance
01:01:01
to retool themselves with the best
01:01:03
possible technology so they they can
01:01:05
actually preserve as many of the jobs as
01:01:07
possible because at the limit if every
01:01:10
single company is able to implement
01:01:12
something that is as economically
01:01:13
efficient as what Clara did
01:01:15
Teleperformance doesn't exist and
01:01:17
there's 10 billion and 335,000 employees
01:01:21
that will not have a job Y and so for
01:01:24
Clara the reason to open source it is
01:01:26
twofold one is they don't lose anything
01:01:29
because you will still need to train it
01:01:31
on your own data and so there's no
01:01:33
disadvantage that Clara will have right
01:01:36
they're just saying look I built this on
01:01:37
top of GPT here's what it looks like and
01:01:40
that production code can be used by
01:01:42
anybody else go for it but it has to run
01:01:44
on your own data that's a very
01:01:45
reasonable thing so I think it has the
01:01:47
benefit of both a setting a technical
01:01:50
Pace that can help them attract better
01:01:52
employees and more highly qualified
01:01:54
people who find the scope of work even
01:01:56
more interesting and B I think it's on
01:01:59
the right side of history with all this
01:02:00
AI stuff where it's allowing everybody
01:02:03
to sort of benefit in a way that is the
01:02:05
least destructive but I just wanted to
01:02:07
show you that the destruction was quite
01:02:09
quick and it was pretty severe and if
01:02:11
two or three other big companies launch
01:02:13
these kinds of tweets after real
01:02:15
measurable results Teleperformance will
01:02:17
be a 1 billion doll company short in
01:02:19
short order there's a third reason I I
01:02:21
think it's a brilliant idea for clar to
01:02:22
open source this this tool because it's
01:02:25
not their business right this is just
01:02:27
something they did as a as a
01:02:29
productivity Improvement they get the
01:02:30
benefit back to them of the community
01:02:32
working to advance that technology so
01:02:34
they don't have to put more Engineers
01:02:36
like advancing the ball on their
01:02:38
customer support AI totally they can
01:02:40
just re remerge in the changes that the
01:02:42
open source Community comes up with and
01:02:44
since they're not in the business of
01:02:46
selling AI directly there's no reason
01:02:48
not to do it like jamas said so I think
01:02:50
it's kind of brilliant yeah this is meta
01:02:52
strategy by the way I mean z should be
01:02:54
building this on meta's Open Source
01:02:56
Products and Apple's Open Source
01:02:57
Products right SX yeah well so what what
01:02:59
meta said what Zuck said on the last
01:03:02
meta call is the reason we open source
01:03:04
everything is because we don't directly
01:03:05
sell AI we create products that AI makes
01:03:09
better so by open sourcing this we allow
01:03:12
the community to advance the ball and we
01:03:14
get to reincorporate those changes so
01:03:16
it's a very smart strategy for companies
01:03:19
that aren't directly selling the AI now
01:03:21
you know if you're if you're like Brett
01:03:23
Taylor's new company Sierra obviously
01:03:25
you're not going to open source it
01:03:26
because your whole business model is to
01:03:28
create a proprietary solution yeah but
01:03:30
then to chat's you know 8090 whatever he
01:03:34
was talking about the with his you know
01:03:35
incubator concept and you know these
01:03:38
things it's a company it's a company
01:03:40
okay sorry um is it 8090 or 980 I'm
01:03:42
sorry 8090 yeah 8090 is there a third
01:03:45
word that comes off of it are just G to
01:03:46
call it 890 just 8090 got it okay 80% of
01:03:49
the features at a 90% discount so back
01:03:51
to that like what does this mean if
01:03:53
these things are getting to freeberg
01:03:55
your point about the pace man the pace
01:03:57
of these things is it going to improve
01:03:59
10% a year or 10% a month if it's
01:04:01
improving 10% a month we're going to get
01:04:03
to 98% of queries done this year if it's
01:04:07
doing 10% a year okay we're going to get
01:04:08
to 99 or 98% of queries in four years in
01:04:11
other words this is happening folks and
01:04:13
it's happening at a blistering Pace by
01:04:15
the way think of it's so not just
01:04:18
Teleperformance which is a it was A10
01:04:20
billion now a $ 7.58 billion USD company
01:04:24
but think about zenes right zenes was a
01:04:27
I think A8 to1
01:04:29
billion yeah it was A10 billion take
01:04:32
private in the hands of PE the entire
01:04:35
zenes workflow could be replaced by a
01:04:37
handful of these open source agents
01:04:39
where all of a sudden people can
01:04:41
eliminate a lot of opacs I think the I
01:04:44
think the thing to keep in mind here is
01:04:45
where the world is going has always been
01:04:48
to try to lower cost and the original
01:04:52
foundational principle of SAS was that
01:04:54
there's these line items in on-prem
01:04:56
software that are just extremely
01:04:58
expensive over time very hard to justify
01:05:01
right and so when people moved to SAS
01:05:03
from on Prem they were looking for cost
01:05:05
savings that was the initial thing now
01:05:07
yes it's actually not cheaper anymore
01:05:09
but it's much more featur so you get a
01:05:11
lot more value in SAS etc etc but the
01:05:14
point of these AI agents and Bots and
01:05:16
workflows is that it'll reintroduce the
01:05:19
concept of cash of of cost Savings of
01:05:22
this idea that you can have cheaper
01:05:24
faster and better and the more that that
01:05:27
stuff is open source my gosh I think it
01:05:29
just makes it very hard for companies
01:05:31
that have Point products to survive yeah
01:05:34
we I was talking to a friend of mine
01:05:35
Josh MOA who was the city head
01:05:39
of uber in New York and he launched his
01:05:41
own note-taking app he's writing it
01:05:43
himself and he's obsessed with this
01:05:45
concept of building a billion dollar a
01:05:46
unicorn company with one employee and
01:05:48
this is something that a lot of people
01:05:50
have been talking about my friend Phil
01:05:52
Kaplan from DH kid built a very large
01:05:54
business in District a unicorn with a
01:05:56
very like I think low single digit
01:05:58
number of people this could be the
01:05:59
future of you know efficiency you you
01:06:02
could build if you catch fire with a
01:06:03
really hot company that gets a million
01:06:05
custom absolutely the future it's
01:06:06
absolutely the future and then if you
01:06:07
think about our jobs in terms of capital
01:06:09
allocation well how much Capital does
01:06:11
that founder need do they need to dilute
01:06:13
10% 20% 30% they're not going to need to
01:06:15
delute 60 70 80% a oneperson company
01:06:18
should be able to spend less than a few
01:06:19
hundred grand to get to product Market
01:06:21
fit in the next few years yeah I mean
01:06:23
that's that's kind of what we're seeing
01:06:24
just to go back to your question J like
01:06:28
where does this go next yeah please I
01:06:30
think it's it's it's really interesting
01:06:32
to speculate about that so what Clara
01:06:34
seems to be talking about are
01:06:36
email-based customer support cases I
01:06:39
think we're this going to go next is to
01:06:41
phone 100% and these call centers use
01:06:44
what they're called ivrs these
01:06:46
interactive voice response systems but
01:06:48
they're very rigid it's a lot of
01:06:49
pre-recorded messages and it says push
01:06:51
one if your problem is this push two if
01:06:53
your problem is this everyone hates
01:06:54
those things yeah I think where it goes
01:06:57
next is you'll call up the call center
01:06:59
and you'll get a a voice that sounds
01:07:01
like a human just talk to you yeah and
01:07:04
you won't even necess realize that
01:07:05
you're talking to an AI because they're
01:07:06
already these AI companies that can do
01:07:09
generative voices any language any
01:07:12
accent oh and they're fast now and
01:07:14
they're fast and multi language think
01:07:16
about that just localizing them across
01:07:18
the globe you know you want to launch
01:07:19
your product in Japan by the way did you
01:07:21
guys see there was a meta demo which I
01:07:23
thought was really cool which was it was
01:07:25
run on Lama 70b but it was a real-time
01:07:29
translation tool where the person was
01:07:30
speaking in hen Chinese and the and the
01:07:32
other person was speaking in English and
01:07:34
they were able to understand each other
01:07:35
but saxs to your point when that person
01:07:38
calls for example B OFA now Spanish is
01:07:42
not a language it's actually many
01:07:44
dialects and many many many different
01:07:46
accents right depending on which country
01:07:48
you're from like the accent that you
01:07:49
hear in Spain is totally different than
01:07:52
the accent in El Salvador the accent in
01:07:54
Chile or Argentina and so wouldn't it be
01:07:56
amazing where you you call your bva app
01:07:59
it picks up your accent and your
01:08:01
tonality and it responds with the person
01:08:03
of that exact same accent and tonality
01:08:06
that is incredible well I'll take it to
01:08:08
another level you call it recognizes
01:08:10
your number it knows what you're doing
01:08:12
in the software it knows the problem
01:08:13
you've had it knows the last three times
01:08:15
you called and how long you've been
01:08:17
using the software and it anticipates
01:08:19
like okay I know this person has a
01:08:20
Windows machine and it's you know still
01:08:23
5 years old and it's like are you still
01:08:24
using that same 5-year-old Windows
01:08:26
machine yeah we know it's a bug with you
01:08:28
know Windows whatever uh you should
01:08:30
probably upgrade I mean it's going to
01:08:31
know the entire context of this and so
01:08:33
it's going to just get it could be more
01:08:36
efficient than a human could ever be the
01:08:38
best customer support interaction I had
01:08:40
was I called JP Morgan Chase because I
01:08:42
had an old credit card that I had had
01:08:44
for 20 years and I think that they had
01:08:46
outsourced it to somewhere in the
01:08:48
Caribbean and this woman picked up the
01:08:50
phone it was so cool jamat what is the
01:08:52
problem man and I was like oh this is
01:08:54
the best and I had this whole
01:08:56
conversation with her for 15 20 minutes
01:08:58
nothing to do with the phone uh nothing
01:09:00
to do with my credit card rather it was
01:09:02
great she's like I man you want to
01:09:04
cancel your card I was like yes please
01:09:06
no but you could do celebrities best
01:09:08
yeah celebrity voices yeah J Cal do the
01:09:11
djt okay let's let's role play uh you're
01:09:13
Donald Trump okay and I and I am JP
01:09:17
Morgan hi Mr President chath you're huge
01:09:21
you've got big spending I every time I
01:09:22
go see chath go see yourth I go in
01:09:25
amazing Mr Mr President I would like to
01:09:27
cancel my credit card sir okay you don't
01:09:29
want to cancel it we've got a great a
01:09:32
3.9% but for jamas you know what he's my
01:09:36
Sri Lankan friend how much do we love
01:09:37
Sri Lankans
01:09:38
okay huge and not jcal nasty nasty man
01:09:44
jcal very nasty he acts like a dog a dog
01:09:48
okay he's a dog some people say
01:09:51
TDS how much do we love our sex Saxy
01:09:54
poop great Mar Lago I go to Sax's house
01:09:58
his house huge huge
01:10:01
house almost as big as Maraga not quite
01:10:06
I gotta work on it because I haven't
01:10:07
done it for years that's really good
01:10:09
it's really good have you seen that guy
01:10:11
there's a there's a new like Impressions
01:10:13
guy who's amazing he does seen him he's
01:10:16
on Howard Stern all the time right he
01:10:17
does the Howard no not Shan Gillis this
01:10:20
is another kid Matt freed friend yeah
01:10:23
yeah yeah does Howard back to Howard
01:10:25
it's wa that video is good too hold on
01:10:31
Donald on other Trump Impressions so
01:10:34
like I'll tell you what Zack there are
01:10:36
so many people that try to do it you see
01:10:38
the failed Alec baldwi Baldwin comes out
01:10:40
on SNL which used to be a lot funnier
01:10:42
back in the day with chff but Baldwin
01:10:45
goes like this he goes we've got a great
01:10:50
show I don't do that I never say boy boo
01:10:53
this St coar he comes out like I know a
01:10:57
do do dot a DOT do a dot dot dot a China
01:11:00
I don't say the D and the last one is
01:11:03
Jimmy failing fell and he touched my
01:11:05
hair like a dog and Jimmy fa and he goes
01:11:09
okay look like dog we're rolling okay I
01:11:12
don't do these moves they're all wrong
01:11:15
so that's
01:11:16
a
01:11:19
incredible can let's see him doing uh
01:11:21
how got see him do Howard Stern it's
01:11:23
Next Level the other one he does that's
01:11:25
incredible but subtle is Stanley Tucci
01:11:27
how are you by the way Robin you look
01:11:28
beautiful right thank you is this still
01:11:32
you up Howard it's me up right yeah
01:11:35
right because when I start talking to
01:11:36
Robin after you leave I get crazy you
01:11:39
know right can we just talk about this
01:11:42
can we
01:11:43
talk right or wrong right right right
01:11:47
right Howard left or right right uh
01:11:50
right right right right right right
01:11:53
right on red right right right right
01:11:57
it's so great he is killing it I think
01:12:00
we have our halftime act for the all in
01:12:01
Summit 24 oh for sure oh my God yeah
01:12:03
he'd be amazing I love Stanley Tucci by
01:12:06
the way he's great oh you got to see
01:12:07
this kid Stanley
01:12:09
Tui have have you guys watched the
01:12:11
Stanley Tui on HBO where he cooking yeah
01:12:15
where like he goes to Italy it's so
01:12:17
great it's so great he does it on Tik
01:12:18
Tok too he just randomly cooks something
01:12:21
and he's like I'm going to make a
01:12:22
frittata I have some over Yi and I'm
01:12:24
just going to I do watch him on Tik Tok
01:12:27
Thanksgiving is a special time I'm in
01:12:29
London celebrating so today I'm making
01:12:33
St stuffing and also Sugo de car or as
01:12:37
it's known gravy now the thing about
01:12:40
stuffing is you might use a traditional
01:12:43
white bread but in my household I use a
01:12:46
homemade fatea because I'm Italian on
01:12:49
both sides and nothing tastes better
01:12:51
than bread with a little M SAU
01:12:54
it's a time for gratitude and giving
01:12:56
thanks enjoy your holidays and thank you
01:12:59
very much Felicity good that is really
01:13:01
good he's so good he's so good all right
01:13:03
listen I don't know how I keep the show
01:13:05
going here but three two okay Issue four
01:13:07
reddits S1 is kind of fun let's break it
01:13:09
down everybody 2023 Revenue 84 million
01:13:12
up 21% year-over-year they're still
01:13:15
losing money uh net loss 91 million in
01:13:17
2023 they lost 159 million in 2022 so
01:13:20
they're cutting the loss free cash flows
01:13:22
negative
01:13:23
here's a chart of their quarterly
01:13:25
revenue and cash flow so they're kind of
01:13:27
bouncing along the break even Mark as
01:13:29
you can see there in the chart they got
01:13:31
a wonderful gross margin because they
01:13:33
don't pay to produce the content unlike
01:13:36
the New York Times or Netflix and so an
01:13:39
86% gross margin up 2% year-over-year
01:13:42
their daily active unique 76 million up
01:13:45
27% year-over year average revenue per
01:13:47
user is incredibly low three bucks and
01:13:50
42 and their daily active unique users
01:13:55
uh here you can see another chart
01:13:57
growing nicely quarter over quarter they
01:13:59
got a billion two in cash most
01:14:02
interesting probably uh and could be
01:14:05
challenging to execute on is their
01:14:07
direct share program they're going to
01:14:08
carve out a bunch of shares in the IPO
01:14:12
to sell to their most active mods those
01:14:14
are the moderators the people who run
01:14:16
the different channels or subreddits as
01:14:18
they're called what could go wrong what
01:14:20
could go wrong wrong we've seen this
01:14:22
movie before
01:14:23
and uh but they're going to invite you
01:14:24
since to participate on it on a rolling
01:14:27
basis more
01:14:28
unqualified retail buyer pool does not
01:14:32
exist in the Reddit mods except maybe
01:14:34
the Reddit participants W Street bat
01:14:35
knows what they're doing yeah I think
01:14:37
they'll buy the uh I think they'll buy
01:14:38
after the lock up comes up but let's
01:14:41
just get started here I think you looked
01:14:45
at the S1 a little bit freeberg and you
01:14:49
had asked us to you asked me to put on
01:14:51
the docket because you were you were
01:14:52
digging into it anything stick out to
01:14:54
you or thoughts on the business overall
01:14:57
no I mean I wasn't pulling I just asked
01:15:00
if you guys had read it
01:15:02
umy um I hey I think I made a funny
01:15:07
joke read it accient get it I I'll let
01:15:12
you guys go on for a minute go ahead go
01:15:14
ahead tell me when you're
01:15:16
ready it was a good pun too bad it was
01:15:21
accidental no it was it was intend I'll
01:15:23
give you credit it was we'll give it to
01:15:25
you so I think the the thing about
01:15:26
Reddit if you could pull up the chart
01:15:28
with the quarterly average daily active
01:15:30
user data this was a business that the
01:15:33
last couple of years everyone was like
01:15:34
had flatlined because it was only
01:15:36
growing 5% a year in terms of usage and
01:15:40
then all of a sudden in the last two
01:15:42
quarters so starting in late summer
01:15:45
early fall of 23 so just six months ago
01:15:48
the usage started to climb pretty
01:15:50
significantly growing 15 and most in the
01:15:52
most recent quarter 27% year-over-year
01:15:55
absent that growth story it's a really
01:15:58
challenged business because a business
01:16:00
without much growth gets value typically
01:16:02
on a multiple of the cash flow that
01:16:04
they're generating and you know there's
01:16:06
less upside and all this kind of
01:16:08
optionality goes away that's kind of a
01:16:09
key point I I don't know I think like
01:16:11
for you to make an investment at a $5
01:16:12
billion valuation here you've really got
01:16:15
to believe that the growth continues at
01:16:17
this rate and it doesn't revert back to
01:16:19
the mean growth rate of the last couple
01:16:21
of years of basically 5 % which is
01:16:23
roughly flatlined the other challenge
01:16:25
they have is that their AR only in that
01:16:27
kind of $3 range which is like less than
01:16:30
10% of where Facebook is at and the data
01:16:33
that Facebook collects on their users
01:16:35
gives them the ability to do much better
01:16:37
targeting on ads and therefore monetize
01:16:39
Their audience much better than Reddit
01:16:41
has been able to do to the order of over
01:16:43
10x and then if you look at the arpo
01:16:45
number how much they've been able to
01:16:46
grow that metric it's also you know been
01:16:49
a little bit flatlined so this business
01:16:52
I think is a real question mark I mean
01:16:54
you could argue it's probably worth in
01:16:55
the best best case in the2 to3 billion
01:16:58
kind of valuation range and then you
01:17:00
have to believe the bull case that the
01:17:02
growth continues or accelerates from
01:17:04
here and they have a plan to address the
01:17:07
arpo problem they have other paths for
01:17:09
monetizing Their audience than what
01:17:11
they're kind of doing today what do you
01:17:14
guys think this thing's worth do you buy
01:17:15
it if it goes out at three billion or
01:17:17
five billion I think the first question
01:17:19
which you nailed that of buysight
01:17:24
investor will ask is what happened in
01:17:27
the last two quarters that was different
01:17:28
than the last 15
01:17:31
quarters that's going to be a very
01:17:33
important question and I think they're
01:17:34
going to have to have a very buttoned up
01:17:35
answer for that right and if they can
01:17:38
point to very specific repeatable things
01:17:42
I think that'll be good the thing that
01:17:44
they this IPO if it goes off in the next
01:17:48
four weeks they won't have to wait but
01:17:52
if it doesn't get off in the next four
01:17:53
weeks they'll have to update the S1
01:17:55
probably with
01:17:56
q1 and so you'll see whether this thing
01:17:59
is a trend or whether it was a one-time
01:18:01
thing do you know what it is well the
01:18:04
growth in the logged out is probably
01:18:06
largely because typically if you use it
01:18:08
on a
01:18:09
[Music]
01:18:10
phone it tries to force you to use the
01:18:14
app right so that you can be in this
01:18:16
logged in experience and if you just
01:18:19
turn that off you can get a lot more
01:18:20
logged out because Reddit gets
01:18:22
tremendous rank Authority from
01:18:24
Google so if you just if you just turn
01:18:27
that off I think that you'll have a lot
01:18:28
of logged out customers and that will
01:18:30
grow very quickly and so maybe it's a
01:18:32
decision that they'd rather have the
01:18:33
Topline number grow than have logged in
01:18:36
users grow but the logged in user growth
01:18:37
has still been pretty healthy it's
01:18:39
basically doubled in the last three
01:18:40
years so but to your point freeberg if
01:18:43
they said or our business is really only
01:18:46
these 30 odd million logged in users it
01:18:49
would be worth a lot less than saying 75
01:18:51
million I think it's I think you're
01:18:53
right it's kind of like in the mid you
01:18:57
know kind of two three four billion
01:18:59
dollish range the the big problem is the
01:19:02
arpu because these are not
01:19:04
users that represent sort of Facebook's
01:19:07
bread and butter kind of a $40 arpu
01:19:11
lives in a good suburb in the United
01:19:14
States and is monetized like
01:19:17
crazy I just don't think that's what
01:19:19
these users are but you could see that
01:19:21
as a challenge or opportunity because if
01:19:23
their RP is only 10% of Facebooks
01:19:26
there's a lot of Headroom there to grow
01:19:27
it if those users become economically
01:19:31
more valuable RP is actually down 2%
01:19:34
year over your sex the issue with this
01:19:35
user base is they're incredibly
01:19:37
sophisticated internet users who don't
01:19:39
click on ads and are kind of anti- ads
01:19:42
as opposed to you know the the general
01:19:45
population on a Facebook or a generic
01:19:46
service and it's Anonymous so you don't
01:19:48
know who the user is which is how
01:19:50
Facebook has such incredible demographic
01:19:51
targeting capabilities there's been a
01:19:53
lot
01:19:54
of conspiracy theories longc con
01:19:56
theories that came up Sachs that we were
01:19:59
talking about on group chat maybe you
01:20:01
could summarize this
01:20:04
long game that was played by Sam wman
01:20:07
and the allegedly founders of Reddit to
01:20:10
wrestle control of Reddit back from
01:20:13
their previous corporate owner
01:20:15
kest well this was a post by Yan who is
01:20:18
a former CEO of Reddit that was
01:20:20
published back in I think 2015
01:20:23
and he kind of lays out what I think
01:20:26
happened or I mean he says at the end
01:20:28
just kidding but if he's the former CEO
01:20:30
describing these events he must be
01:20:33
describing something he knows about I
01:20:35
would just
01:20:36
think but in any event what happened is
01:20:39
that Reddit was sold for only about $10
01:20:41
million a year after it launched so like
01:20:43
really really small and I think that it
01:20:45
kept growing and the founders realized
01:20:47
maybe they made a mistake or that this
01:20:50
was actually a bigger property and so
01:20:53
they started scheming on how to get
01:20:54
Connie Nas to spin it back out and so
01:20:57
Yan lays out the steps they went through
01:21:00
they
01:21:01
recruited a CEO who they kind of
01:21:04
pre-agreed on then they had that CEO
01:21:07
demand options specifically in Reddit
01:21:10
from Ki Nast which meant that Ki Nast
01:21:12
had to create a separate cap table for
01:21:15
it and then once they had a separate cap
01:21:17
table as a subsidiary of Cony Nast then
01:21:21
they could sort of pressure to have like
01:21:22
an outside investor bought in for the
01:21:25
expertise that just happened to be Sam
01:21:26
Alman and his
01:21:28
fund and you know eventually like step
01:21:31
by step they worked it to the point
01:21:33
where they got Connie asked to spin off
01:21:35
the
01:21:35
company and I guess this plan worked now
01:21:39
it should be said that the largest
01:21:40
shareholder in Reddit according to the
01:21:43
S1 is Ki Nas or Ki Nas parent company so
01:21:46
no one's going to benefit more from this
01:21:49
plan if you want to or scheme if you
01:21:51
want to call it that than Connie n it
01:21:52
was a smart thing for them to do to spin
01:21:56
out Reddit to allow the employees to
01:21:59
have options and then I would say to
01:22:00
bring back the founder Steve Huffman as
01:22:03
CEO several years ago so great it worked
01:22:05
out for everybody you know who knows if
01:22:07
it was all premeditated so if they own
01:22:09
30% and it goes out for five billion
01:22:12
they got 1.5 billion and they paid 10
01:22:15
million for it
01:22:17
so
01:22:19
that's a Web 2.0 1.0 2.0 no it's it
01:22:23
launched in 2005 2.0 the same time as
01:22:26
like web logs Inc and delicious and
01:22:28
Flicker and all that that whole cohort
01:22:31
of little web apps that used Ajax and
01:22:34
other things to you know the web was
01:22:36
just getting faster and there were a lot
01:22:39
of users well anyway congratulations it
01:22:41
was it was smart for Cony Nas to do the
01:22:44
spin out and give up 70% in order for to
01:22:47
have 30% of what's going to be a
01:22:48
multi-billion dollar IPO great outcome
01:22:50
for everybody all right issue five five
01:22:53
Apple doesn't have a fast car project
01:22:55
Titan is DBA dead before arrival apple
01:22:59
as you know has been working on an
01:23:00
electric vehicle for a decade
01:23:02
self-driving as well they've invested
01:23:04
billions in the project according to
01:23:06
Bloomberg and apple was targeting 100K
01:23:09
price point basically going after the
01:23:10
model S plaid with FSD company had 2,000
01:23:15
employees working on this project it was
01:23:16
called Titan and they had designers from
01:23:19
Austin Martin Lamborghini Porsche
01:23:21
according to the report most of the team
01:23:22
will be transferred to Apple's
01:23:24
generative AI division we talked a
01:23:26
little bit about Maggie their um
01:23:28
generative AI image language model
01:23:32
there's going to be some layoffs it's
01:23:33
unclear how many what does building a
01:23:35
car have to do with building an llm well
01:23:37
they were yeah so they weren't just
01:23:39
building a car they were all in on
01:23:41
self-driving and not having a steering
01:23:42
wheel so I understand I'm just saying it
01:23:45
doesn't make a lot of sense that 2,000
01:23:47
employees that were specialized in
01:23:49
building a car all of a sudden now
01:23:51
become the AI
01:23:53
team it would be more like the full
01:23:55
self-driving team is probably getting
01:23:57
those AI jobs and the rest are probably
01:23:58
getting laid off with Incredible
01:24:00
packages but what do you think sax I was
01:24:02
always skeptical that Apple was even
01:24:03
working on a car it's just a very
01:24:05
different kind of product than anything
01:24:06
else they make and so I never really
01:24:10
treated it that seriously that they were
01:24:11
going to make a car so I'm not I the
01:24:14
surprise to me is not that they canceled
01:24:16
this but that the that it was even true
01:24:18
that they're working on it in the first
01:24:20
place yeah no it was it there were
01:24:22
reports of them having test tracks and
01:24:24
everything it was pretty well
01:24:25
established and you could see that
01:24:26
people from Tesla and other places had
01:24:29
does it say why they actually killed it
01:24:32
no this is just a
01:24:33
report and I the speculation is that
01:24:36
they're going all in on AI they just see
01:24:39
that as a much better future well I
01:24:41
think it's more core to what they do I
01:24:43
mean the car never seemed that
01:24:45
core no and uh there were reports and
01:24:49
elon's talked about it publicly so we're
01:24:50
not speaking out of school here or
01:24:51
anything but
01:24:54
that Elon and apple had and Tim Cook
01:24:57
reportedly had talked or there have been
01:24:59
overtures that maybe Tesla was going to
01:25:01
get bought and Elon it's been pretty
01:25:02
clear that during the model 3 roll out
01:25:05
he was considering selling it to Apple
01:25:07
that would have been a smart acquisition
01:25:08
if they had done that can you imagine
01:25:10
all the Apple showrooms having a Model S
01:25:13
in it or something or a model y I mean
01:25:14
boom they would have just sold so many
01:25:16
of them and having the Apple operating
01:25:18
system on that display well wait was it
01:25:20
before the Model S came out or the model
01:25:23
3 it was model 3 was the time I think
01:25:24
they were talking seriously but remember
01:25:27
like no one really believed in the model
01:25:28
3 till it came out and started selling
01:25:30
like hot cakes the opposite they thought
01:25:32
it was going to kill the company right
01:25:35
all right everybody for the Rainman
01:25:38
David Sachs chairman dictator chth p
01:25:40
hoaa and consultant of science David
01:25:44
freeberg I am the world's greatest
01:25:46
moderator and we will see you next time
01:25:48
byebye gr
01:25:51
GR
01:25:53
we let your winners
01:25:55
ride Rainman
01:25:59
David and instead we open sourced it to
01:26:01
the fans and they've just gone crazy
01:26:03
with it love queen
01:26:06
[Music]
01:26:12
of
01:26:15
Besties my dog taking
01:26:18
driveways man oh man
01:26:22
meet me we should all just get a room
01:26:24
and just have one big huge orgy cuz
01:26:26
they're all this useless it's like this
01:26:28
like sexual tension that they just need
01:26:29
to
01:26:30
[Music]
01:26:36
release we need to get
01:26:41
[Music]
01:26:50
merch
