The Exchanges

Q Why is Alfred incredible and what specifically makes you say that?

A Alex picked me so often over the years about Alfred. Alfred is a very unique, very unique investor, uh, and, um, in many dimensions, but like a few things, uh, uh, that I really appreciate and admire about Alfred. One, he's not the type of investor. He's kind of the antithesis of what you would usually imagine a VC to be, which is like, VCs love to make strong, simplistic statements. You know, you tweet something like, the way to win is like, have a great team. And like, Alfred's answer to everything is this sort of very nuanced, in the gray, uninteresting, uninspiring answer. But it tends to be the right answer. Like, and most investors like simple kind of, like, structures and frames. Like, oh, you know, the margins are going to get compressed, so the business is not going to be very hard. Whereas Alfred is like, well, how is specific compression over time? It's actually going to be slower than expected, and then you're going to grow. And it's kind of a lot of, like, in the gray, You know, math and nuance, but that helps push you to get to the right balance between this in every decision. So one is nuance. Number two is he's always, always a kind of counterbalancing actor. So, and the thing I learned with Alfred is every time, so if I go with him with idea A, he will argue for the other, for not A, and if I go with idea not A, he will argue for A. Always. Systematically. He w…

AI assessment note: “Alfred's answer to everything is this sort of very nuanced, in the gray”

Q Do you think we've moved too far in that direction? When you look at the, yeah, in the distribution is everything, the rage bait, the everyone has videos and everyone has a podcast and the clearly I'm going to take pictures doing obscene things. And the, do you think we've moved too far?

A Here's the way I would put it, right? I mean, you take that statement to the extreme, it's like maybe you should do marketing and not really focus on product. Well, that, that is definitely a recipe for failure, right? Like in, in the order of, of things like, you know, Build a great product, but make sure to think about your marketing motion early enough. Don't think of it like years late, which is what we did, which was, I think, a mistake. The second is, you know, build a great product and then think about your marketing. The third is build a great marketing machine and then think about your product, is my view. Because no matter the number of eyeballs and the number, you have to build a great product, right? Like there, you know, there's a lot of people that have had massive eyeballs. You see influencers and you see celebrities with mass eyeballs. They're, you know, they, you know, their tweets get tens of thousands, if not hundreds of thousands of likes sometimes. Um, and they launch a product that doesn't really work, right? That's the age old story of, you know, and so I'm not a believer of this whole like distribution first and that's all that matters. And no, I think you have to do, you have to have a great product. That's a precondition to success, but you have to also build in today's age because technology has become easier, right? It's, it's not that building tech …

AI assessment note: “I'm not a believer of this whole like distribution first and that's all that matters.”

Q it breadth, or is it like depth? You know, is there 99% of trading and interest in a very small number of inventory, or is that breadth massively important? You know, me and your team were talking before this about Luana and doing some PR in Brazil, and just getting the brand in Brazil. Is breadth everything, or is it having the one percent that everyone gives a shit about?

A It's a great question. We think about this a lot. Um, and the unfortunate truth is the answer is kind of like a nuance in between. Uh, you know, you, you, you know, you cannot go fully, uh, fully vertical because then your product offering is not diverse and interesting enough, and you cannot go fully wide because then you don't concentrate enough liquidity in specific events. That what, that's what makes it an interesting marketplace problem. It's a, it's a, it's not an easy problem, but like, you know, my mental model for this is you have to have breath, like product diversity. And, you know, making sure that people have enough content to engage with and markets that are related to the news or the things that they read on X is important, right? Like if you, and it's a bit similar to X. If you go on X and read about one specific thing all the time, like that's not gonna make a very interesting experience. You have to have diversity, even if there are specific topics that are the vast majority of the eyeballs. So it's just really a balancing, a constant balancing act between the two.

AI assessment note: “the unfortunate truth is the answer is kind of like a nuance in between.”

Q chances of success. It means you'll have another round of funding. It means more good people want to join and people want to make money for their families and make money. And so it's completely logical that you would get more people want to join post Sequoia investing. Do you agree with me? Or do you take the stance that don't take people who only join because of your investor?

A The best people want to win, right? Like they want to join a winning team. And like, I think having great investors is, is one sign out of many others that you are on a winning team, right? So, so I, I think expecting people to like disregard that altogether is that probably, you're probably kind of like, you know, pushing out or, or excluding some people that are, you know, winners, people that really want to win. But at the same time, you have to be, you know, make sure you're picking people that are, they're going to do what, you know, they're going to really work hard and do whatever it takes to win, uh, as long as they believe that this is kind of a winning company and a winning formula. Um, so, so my answer is like, I don't think that people that like see having Sequoia on the cap table as a strong signal are, are, are bad people at all. Like, I think, no, but I think you still have to do the diligence in the interview. It's like, is, is this person just joining just for a free ticket on a ride? Or is this person joining to make that ride go accelerate even harder? And are they gonna do whatever it takes and work however hard to make it happen? Um, if the answer to that is yes, then, you know, by all means, you should hire that person.

AI assessment note: “I don't think that people that like see having Sequoia on the cap table... are bad”

Q When did you stay true and you should have moved and what did you learn?

A And this is gonna sound a little bit unusual. I was too Product driven for too long. Like, I think I was always like, we got to build the product and make it absolutely perfect. And it needs to grow, you know, and grow really fast organically. And then we basically, uh, do more marketing and, you know, uh, build a brand. And I actually think you have to build both together. And I think if I were doing it again, I would really be thinking about building both together. Your product is never going to be perfect, right? Like it evolves and it shifts and it improves over time. And, and the brand, you have to learn it. It's a muscle, right? The, the growth and marketing and brand is not something that you just turn on all of a sudden. It's like, oh, now we're ready to grow. It is a muscle. It's something you have to embed in your company. And so I, I changed my mind on this, which is like, it's not like, maybe it's the YC thing, which is build a great product and people will come. I, I, I, I, you know, I, I think build a great product, but build a great marketing engine and scramble to do both at the same time is now my best answer to this.

AI assessment note: “I was too Product driven for too long... you have to build both together.”

Q Yeah, I know. I said it was the last one from founders, but I just found a couple more really great ones. So now we're gonna move to Tarek at Kalshi on what he's running from?

A It's a great question, actually. I've never been asked that on a podcast. Personally, I think it just, like, tends to be very related to parents. My dad was really absent, and I think there was this kind of constant need of, like, where is he, and what's going on, and why is he not there? And then to my mom, and I attributed a lot of things to her. She was a great parent, but she was very strict when it came to excellence. It was truly one of those things where, like, you come back, and you're excited about having achieved 98%. She is just focused on the two percent. She was like, where is that? I think she just like would push us to be at one, 20% of the way every single day, like the one, 20% was very consistent. Everything we did. I think that drive and that sort of need for one 20%, that doesn't leave.

AI assessment note: “tends to be very related to parents. My dad was really absent”

Q Yeah, I know. I said it was the last one from founders, but I just found a couple more really great ones. So now we're gonna move to Tarek at Kalshi on what he's running from?

A It's a great question, actually. I've never been asked that on a podcast. Personally, I think it just, like, tends to be very related to parents. My dad was really absent, and I think there was this kind of constant need of, like, where is he, and what's going on, and why is he not there? And then to my mom, and I attributed a lot of things to her. She was a great parent, but she was very strict when it came to excellence. It was truly one of those things where, like, you come back, and you're excited about having achieved 98%. She is just focused on the two percent. She was like, where is that? I think she just like would push us to be at one, 20% of the way every single day, like the one, 20% was very consistent. Everything we did. I think that drive and that sort of need for one 20%, that doesn't leave.

AI assessment note: “Personally, I think it just, like, tends to be very related to parents.”

Q sit and watch on the sidelines. Um, the question then becomes, and a lot of your investors ask this, why partner with a legacy media brand like CNN or CNBC when you could actually own the vertical You have the money, dude. You could build the media brand and the media platform and own the entire stack. Why partner with legacy? And how long before that legacy partnership becomes cannibalism?

A I think they're not mutually exclusive. Uh, and I think that's, you know, that's, that's a fair question. I just think that like right now we're so early that it's hard to think about cannibalism or think about any of this as a zero sum, you know, question, right? It was just so early. The percentage of people that understand, deeply understand prediction markets are still so small. There's so much education to do. And I think the news and, you know, it's partners like CNN and CNBC are really an incredible way to get people to, to understand what these markets are about. And at the end of the day, the mission of the company is like, we want to bring more truth to a lot of these processes, whether it's the election process. Right now we're using polls and pundits and people say whatever they want or weather or climate or the economy and how we make decisions about the economy. And the best way to do that is like put it in the places where people go and take that information. Get their information about that. So imagine where election night coverage is informed by prediction markets, which actually work better than what we're doing today. That is actually net positive, and the best way to do that is, well, you know, let's go to the place where people are going to get their information about the election, and I think the news networks are an amazing way to do that.

AI assessment note: “it's hard to think about cannibalism or think about any of this as a zero sum”

Q Can I ask you a weird one, dude, which is like, if the world is financialized by Kaoshi, Is that actually good for the world?

A I think there's two very important dimensions here. So the answer is unequivocally yes. Yes. Like more free markets generally tend to more positive outcomes always. But the thing that struck me is like the current financial markets, they don't relate to a lot of people like, you know, trading stocks or options or futures, like people don't really understand them. And the game is sort of rigged. It's rigged on behalf of like for Wall Street against Main Street, against the average person. Because you never can win against Wall Street on, like, where a stock is going to go, or where an option is going to go, because they have all the asymmetric information. The thing that got me excited about building this is, like, actually there's an opportunity to build a financial market for a market that relates to anyone, that anyone can relate to. And, like, one of my core beliefs, like, everyone is an expert on something. Like, everyone has a, has, you know, reads the news about certain things, or has passion about, like, specific something, like, like, really the vast majority of people have specific passions, or are really excited about specific vertical. And Couch is really a way to kind of get them to participate in financial market on that vertical that is their home turf, where they are not kind of facing somebody who has more information than them.

AI assessment note: “So the answer is unequivocally yes. Yes.”

Q Can I ask, before we move into a quick fight, you work with some incredible people, Alfred Lin, Henry Kravis, Chuck Schwab, um, and this was Ali Partovi, so credit him for this, but he said, what's been your biggest one learning from working with each of them?

A That's very interesting, so probably pretty different, so Alfred is an outlier, like he's just really good at pushing my thinking, um, And I got to learn that over time. And I cannot really like that now, but like, no matter what I go to Alfred with, even if it's the right decision, oftentimes it is the right decision. Alfred just basically pushes back. He's like, why? You know, you know, he can even go all the way to say, this does not make much sense. Even if he thinks it's the right decision, he just sees the reasoning is not crisp, like super crisp and crystal clear yet. He's like, go back and, you know, go and come back. And, and I really liked that. It's constantly this exercise of like, am I really, really like thinking about this extremely critically? Um, and am I thinking about decision, you know, as crystal clearly as I can. And I think over time that it feels like it's kind of like a little bit like a, you know, coaching, constant like coaching that I'm getting from Alfred that it's pretty awesome. I've been really enjoying that. Um, I think, um, I've interacted more with, with, with, um, with Kravis than Schwab. Um, and, and, and they're actually very similar in a variety of respect, but I'll talk about Kravis real quick. He, um, he's just such a deep, long-term thinker, and like, you know, we're talking like long-term for like decades, you know, he's not, he's not …

AI assessment note: “Alfred is an outlier, like he's just really good at pushing my thinking”

Q you changed, have you changed how you work over the years? What I mean by that is like, you know, now I actually take very few calls. I hate calls. Um, and I try and do everything by email. I, I actually, you know, have teams that obviously help me with email now as well, but how I actually work has changed a lot. Has your style of work changed?

A Yeah, I think so. I mean, I think, um, you know, When I first started Kalshi, it was fully brute force. It was just outright, you know, there's no, no process, no system, nothing. And same, same with my co-founder Luana, it was just 100% brute force where it's like, oh, we need to do this. We're going to pull three all-nighters and we do it. And then we just like constantly brute force, brute force, brute force. It got to a point where like, you know, physically, you know, it was, it was really taxing. And I got to that point where it's become very, very, very tiring. And I would still do that now if it's, if I'm convinced that it's the right thing, but now as I'm kind of starting to see, okay, like the company has grown, the company has matured. Um, I think now I think my role, like, you know, you know, it's going to be the cliche thing where you need to delegate a little bit more, you need to do a variety of different things, but like, there's just so many things to do in a day. Like there's so many things to do that if you're just brute force to it, it just does not become the optimal solution. I do think it was the optimal solution when you're, when you're, you know, when you're first starting a company, but right now it's like, If you don't actually pause and I, you know, I'll give a, you know, first step, which is like, first you can just like throw yourself into work and…

AI assessment note: “When I first started Kalshi, it was fully brute force... Now at the very least I pause and I prioritize”

Q Now, dude, I gotta start on the main thing, a billion dollars. The first thing I have to ask, why does Kaoshi need a billion dollars?

A That's a good question, but what we've realized in the last, um, I would say six to nine months, given the sort of acceleration of what we've seen, um, is I think the opportunity ahead of us is maybe even bigger than we had all possibly imagined. There's a few symptoms Of that. So one, I don't know if you know this, Harry, but, um, Kalshi this year, um, is at this scale, at least, you know, the, I think the fastest growing company in America outside of AI. I think Anthropik is growing faster, and I'm not sure about Merkur and Cursor, but we're, you know, growing at that sort of, at that pace, at that rate. Um, and number two, what we're seeing, which is even more important, the qualitative, uh, thing that we're seeing is there's a, there's a real and rare shift in consumer behavior. You know, people are kind of turning from like passive watchers of events or news or, or sports or other things that they engage with in real life to active participants. You know, that, that natural behavior of wanting to predict the future or debating about something is turning into activity on Kalshi. That is rare. Like when you see this shift in consumer behavior, I mean, you've seen it in Airbnb with the host and Uber with riders. When, you know, you're seeing a new class of people in this case, prediction market traders becoming a thing. That's indicative of a very, very massive opportunity ah…

AI assessment note: “when you have a massive opportunity ahead of you, you, you want to go big”

Q Learning from people is very important. Um, one of your investors are something that they asked not to be attributed, which I'm honoring. Um, but they said, did you ever cross paths with SBF? And what did you learn from observing FTX's implosion?

A I gotta know who this investor is. I, yeah, I mean, the answer is yes. So actually the funny story is, uh, uh, SBF, when I was a freshman at MIT, he interviewed me for Jane Street. Um, and so I'd known him since then. And then when he's, you know, he came into the US with FTX, we met once. We were never really close. He was honestly kind of close to, he was kind of cold towards us when, when things were going well. And I, I think we, We actually had a history of people sort of looking down on us a lot. And, you know, we were a smaller company and we weren't as successful. We're having all these, like, we were like doing the regulated route. We're focusing on regulation. We're like, we want to do it right. We want to do it clean, compliant, regulated first. And in those years, it was very unsexy to be that company. Right? Like you had FTA, like everything was crazy. And like all the unregulated offshore, like, like free for all, like those were the sexy companies. Those were the companies breaking rules and winning and like, and we were seen as sort of the safe, Boring doozers, You know, like we, we, you know, because we were, we were committed, we were like, we are not going to do this unless the government approves it. I have always been unwavering in my beliefs, same with Luana, regulatory first. And the reason is because I think in financial services and healthcare, The only…

AI assessment note: “the answer is yes. So actually the funny story is, uh, uh, SBF”

Q Do you think we've moved too far in that direction? When you look at the, yeah, in the distribution is everything, the rage bait, the everyone has videos and everyone has a podcast and the clearly I'm going to take pictures doing obscene things. And the, do you think we've moved too far?

A Here's the way I would put it, right? I mean, you take that statement to the extreme, it's like maybe you should do marketing and not really focus on product. Well, that, that is definitely a recipe for failure, right? Like in, in the order of, of things like, you know, Build a great product, but make sure to think about your marketing motion early enough. Don't think of it like years late, which is what we did, which was, I think, a mistake. The second is, you know, build a great product and then think about your marketing. The third is build a great marketing machine and then think about your product, is my view. Because no matter the number of eyeballs and the number, you have to build a great product, right? Like there, you know, there's a lot of people that have had massive eyeballs. You see influencers and you see celebrities with mass eyeballs. They're, you know, they, you know, their tweets get tens of thousands, if not hundreds of thousands of likes sometimes. Um, and they launch a product that doesn't really work, right? That's the age old story of, you know, and so I'm not a believer of this whole like distribution first and that's all that matters. And no, I think you have to do, you have to have a great product. That's a precondition to success, but you have to also build in today's age because technology has become easier, right? It's, it's not that building tech …

AI assessment note: “I'm not a believer of this whole like distribution first and that's all that matters.”

Q Totally get you. What does a billion dollars get for you that you couldn't do without?

A I think one, so, okay, we are at a point right now where, so we're growing incredibly fast. Um, we are also profitable right now. Um, you know, and, um, so it's a good question. I think the next phase is how do we build a global brand? How do we build a brand that people know, they talk about, they associate with, um, and how do we put the story of the company and the story of the brand out there? Um, and so there's a lot of marketing that's coming, obviously scaling the team. So we're still a hundred people. And number two is we're a financial market. We're a financial company. So as the volumes increase, as liquidity increases, uh, you, you know, as a regulated, like we're a federally regulated financial exchange, it's a little bit like a bank or some of the kind of regulated clearing house you hear about. You have reserve requirements and added capital on the balance sheet. Think of it a little bit as a safety caution, things that adds sort of, um, uh, it enables us to do things in, in, in like faster, like more capital enables you to do things faster in financial services. And that's usually a good thing.

AI assessment note: “You have reserve requirements and added capital on the balance sheet.”

Q They have every insight on every player and every injury and every weather wind pattern. The, the standards guy, girl betting on an NHL game on Sunday, I think you said, doesn't have that. Is it not just like increasing access to a different field where there are different pros?

A I think that's part of it. I mean, like, I don't think that Citadel and Wall Street has asymmetric information on, for example, our political process. And you saw with the election, like, the best traders in the, you know, in politics, what bills is going to pass, who's going to win an election, they're people that love politics. They're not Wall Street. Like, Wall Street is good, and they can, like, get smarter over time. But where Wall Street is really good is seeing kind of, like, what hedge fund and mutual fund and whatever is buying which stock, and they can know where the stock is going to go better than The average person. But a lot of people have a lot of insight about politics. Why? Because they've been following politics for a decade or two. And you see it in the numbers. These are some of the most successful traders on Kalshi. But there's another kind of a facet to this, to this, which is very important, is that The prediction market user is not just a trader. Actually, if you, out of every hundred prediction market users, maybe there's like one or two traders that are actually trading on the market, but the rest of the users are getting informed about the world. It's really a form of news. It's a form of media. It's a way to basically come in like, you know, get truth about what's going to happen next in a world where like, actually it's been, it's been really hard …

AI assessment note: “I don't think that Citadel and Wall Street has asymmetric information on, for example, our political process.”

Q agree. And that's what I'm, you know, I think hopefully will change in the next few years. Um, when tourists realize that it sucks not to be able to raise money and it sucks not to be able to fund companies and you know, there is shit in this business. Um, tell me final one. Kalshi five years time is 20, 27. We're back on the show. Where's Kalshi then?

A So I think we look a little bit like the New York Stock Exchange where, you know, you think about trading on events, you come to CalShea, and whether you're trading it via your brokerage account that's integrated on CalShea, you're trading it via API, and you're a fund that's basically providing liquidity or trading across CalShea and other assets, or you're someone that's just coming straight up to our app and trading events all across the world. But I, I, I, 20, 27, I think really about it, like, as event contracts becoming something that's as mainstream as crypto or stocks today, and people talk about it as if it's not, It's like a boring utility at that point. Not, not new innovation. Cool thing.

AI assessment note: “I think we look a little bit like the New York Stock Exchange”

Q Paul, how, how do you structure that interview process and how do you make it fun and different? Can we double click on that one?

A Yeah. I mean, I think the, the, you know, obviously it changed over time, but, um, You know, we, we, we try to limit the kind of algorithm interviews and all of that. We don't do money of those. Uh, we do everything. It's either one, it is something that we're actually tackling today in exchange. And we put a lot of time to, okay, how can we scope it out so that, you know, they are go, they go through in the hour that they're talking to us, a similar problem that we've gone through a month ago or today or something like that. And like, let's collaborate on it. So they have very direct exposure to kind of what's going on. And I think that's just exciting. Like it gives them a little bit of inside school, like inside view on, on what's going on inside look, et cetera. And then the second type is more, I don't know. I love these, you know, a lot of people love these, but like kind of just like mathematically difficult, uh, interesting problems. You know, the question that we ask a lot is, um, uh, You know, I, I don't know if we were giving some trade secrets here, but, uh, we, we asked the question about, I guess I don't want to give it, give away too much, but basically it has to do with an elephant and it has to do with the mathematical constant pi and the person has to relate these two somehow. Uh, it's a pretty tough mathematical problem, but it is a pretty elegant solution. A…

AI assessment note: “one, it is something that we're actually tackling today in exchange.”

Q The hardest days of the stories that you tell. Um, Did you ever like doubt your leadership?

A The answer is yes. Right. So, so at times, even, even today, I mean, you always doubt like, because as, as you know, when you're building a company that's just going after a large market and, you know, first not working or then it starts working and then it goes back to not working and then you do that 10 times and then, then it works really, really well, but then everything starts breaking and, uh, um, and this is maybe the phase we're in and then you start fixing some of the things, but then more things start breaking. You have to continuously kind of shift yourself as founder and then CEO, um, and evolve yourself. And there's always questions like, am I going to be able to kind of do this next phase? Right.

AI assessment note: “The answer is yes. Right. So, so at times, even, even today”

Q are motivated on Monday and tired on Friday. And that's a big lesson that I learned. When I was hiring for my fund, I could hire Galactico GPs, or like, fucking hustlers, who may have more flaws, but a different kind of mindset around needing and wanting. So, it's just something I learned. Man, have you made any terrible hiring mistakes? I've made many. What are your big hiring mistakes?

A Yeah, I mean, if I said no, I'd be lying. So, you know, um, No, I think, I think the, the ones that tend to be difficult are the ones where I basically over index, and especially when we first started on, you know, I always, I was, I'm a, you know, one, I've always been very, um, big, um, admirers of raw intellect. You know, at MIT, I would really admire people that just, you know, can come and crank a piece of code at, you know, an order of magnitude less time than anyone else. And I think we over indexed on this a little bit earlier on. I mean, I think it was really about like, okay, what are the smartest people who can get into the company? And I think we would put aside a little bit of the cultural aspects and, um, and you know, whether this, you know, this person is adding positives to the culture where this person can rally troops, whereas this person, you know, a lot, a variety of kind of behavior. I mean, I think it sounds cliche, but I think as young founders, we definitely over indexed on that. And I think that led to the worst, you know, I think the biggest sort of hiring mistakes. The one that tends to be particularly painful is self-awareness, I would say. Um, you know, I think it's itself like people who are not self-aware tend to be very difficult to manage, very difficult to talk to, even kind of like the exit tends to be painful as well, kind of the whole thing…

AI assessment note: “the ones that tend to be difficult are the ones where I basically over index”

Q Um, the other way, the other way that I could ask is Tarek, right? Help me be a better investor. What could I do to be the best investor for you?

A You know, the way, the thing I would say, and you know, Alfred and, you know, Ali Rogani on the board, like, and they're both really great. And the measure, and this is more of a founder, it's really not about the same model VC ecosystem and all that. And it does kind of sound cliche a bit, but I, I truly feel like, you know, the framework is like, um, can this person be my first call when shit hits the fan? And I know everyone says that, but like, it just doesn't tend to be true with everyone. We're lucky enough that I truly feel like I can call I have the people on my board. I can call Ali Partovi literally anytime. And it can be something like something personal that's really shitty just happened and I'm feeling pretty down and I can call Ali Partovi and he'll lift me up. And, and I think that type of, and how, you know, it just kind of boils down to trust and building a relationship that goes beyond like, Hey, give me the quarterly financials and you know, why are these like slower than we expected and why are these faster than expected? Like, You know, it goes beyond that. It goes beyond like actually digging in with the founder, understanding your, like the founder's motivation and actually becoming friends with them, you know, becoming, you know, understanding that you're like with them for the next, if in the good case, which is what the one I'm hoping for for the next …

AI assessment note: “can this person be my first call when shit hits the fan?”

Q Paul, how, how do you structure that interview process and how do you make it fun and different? Can we double click on that one?

A Yeah. I mean, I think the, the, you know, obviously it changed over time, but, um, You know, we, we, we try to limit the kind of algorithm interviews and all of that. We don't do money of those. Uh, we do everything. It's either one, it is something that we're actually tackling today in exchange. And we put a lot of time to, okay, how can we scope it out so that, you know, they are go, they go through in the hour that they're talking to us, a similar problem that we've gone through a month ago or today or something like that. And like, let's collaborate on it. So they have very direct exposure to kind of what's going on. And I think that's just exciting. Like it gives them a little bit of inside school, like inside view on, on what's going on inside look, et cetera. And then the second type is more, I don't know. I love these, you know, a lot of people love these, but like kind of just like mathematically difficult, uh, interesting problems. You know, the question that we ask a lot is, um, uh, You know, I, I don't know if we were giving some trade secrets here, but, uh, we, we asked the question about, I guess I don't want to give it, give away too much, but basically it has to do with an elephant and it has to do with the mathematical constant pi and the person has to relate these two somehow. Uh, it's a pretty tough mathematical problem, but it is a pretty elegant solution. A…

AI assessment note: “it is something that we're actually tackling today in exchange”

Q Okay, a 110. That's a lot of cash. Um, how have you stayed mentally and financially lean and constrained with, bluntly, a lot of capital injected into the company in a relatively short amount of time?

A It's a great question. Um, we, um, so here's what I would say. Uh, Luan and I have a scarcity mentality. Like, we know, um, uh, Like, it's really quite simple. We just don't really consider that we raise that much. It's just, you know, we, we, in our mind, we're basically raised much less. We have, you know, like a certain roadmap for two years. We basically cap our burn very, very aggressively. Like everyone around us says, oh, you're not going aggressively enough. You're not growing the team aggressively enough. And we're like, no, no, no, this is how much, this is how much we're burning a month. And this is the number of sides of the team. And I think we, we do have like a, I would say pretty hard, hard discipline around being like run burn and being frugal. I, I, you know, and I think it comes a little bit from this kind of immigrant mindset where you're kind of always worried that shit things are going to shift and like money is not going to be there for long and all these different things. Um, so, you know, I don't know if this is a kind of like a super amazing answer, but, uh, it's, I think it's working. Um, you know, like the only negative is basically mostly like the only negative is you get more pressure from everyone around you, from The team from investors, like, you have all this money, why are you not spending more? Like, you got that pressure of, like, you know, …

AI assessment note: “Luan and I have a scarcity mentality”

Q Can I ask, before we move into a quick fight, you work with some incredible people, Alfred Lin, Henry Kravis, Chuck Schwab, um, and this was Ali Partovi, so credit him for this, but he said, what's been your biggest one learning from working with each of them?

A That's very interesting, so probably pretty different, so Alfred is an outlier, like he's just really good at pushing my thinking, um, And I got to learn that over time. And I cannot really like that now, but like, no matter what I go to Alfred with, even if it's the right decision, oftentimes it is the right decision. Alfred just basically pushes back. He's like, why? You know, you know, he can even go all the way to say, this does not make much sense. Even if he thinks it's the right decision, he just sees the reasoning is not crisp, like super crisp and crystal clear yet. He's like, go back and, you know, go and come back. And, and I really liked that. It's constantly this exercise of like, am I really, really like thinking about this extremely critically? Um, and am I thinking about decision, you know, as crystal clearly as I can. And I think over time that it feels like it's kind of like a little bit like a, you know, coaching, constant like coaching that I'm getting from Alfred that it's pretty awesome. I've been really enjoying that. Um, I think, um, I've interacted more with, with, with, um, with Kravis than Schwab. Um, and, and, and they're actually very similar in a variety of respect, but I'll talk about Kravis real quick. He, um, he's just such a deep, long-term thinker, and like, you know, we're talking like long-term for like decades, you know, he's not, he's not …

AI assessment note: “Alfred is an outlier, like he's just really good at pushing my thinking”

Q Um, the other way, the other way that I could ask is Tarek, right? Help me be a better investor. What could I do to be the best investor for you?

A You know, the way, the thing I would say, and you know, Alfred and, you know, Ali Rogani on the board, like, and they're both really great. And the measure, and this is more of a founder, it's really not about the same model VC ecosystem and all that. And it does kind of sound cliche a bit, but I, I truly feel like, you know, the framework is like, um, can this person be my first call when shit hits the fan? And I know everyone says that, but like, it just doesn't tend to be true with everyone. We're lucky enough that I truly feel like I can call I have the people on my board. I can call Ali Partovi literally anytime. And it can be something like something personal that's really shitty just happened and I'm feeling pretty down and I can call Ali Partovi and he'll lift me up. And, and I think that type of, and how, you know, it just kind of boils down to trust and building a relationship that goes beyond like, Hey, give me the quarterly financials and you know, why are these like slower than we expected and why are these faster than expected? Like, You know, it goes beyond that. It goes beyond like actually digging in with the founder, understanding your, like the founder's motivation and actually becoming friends with them, you know, becoming, you know, understanding that you're like with them for the next, if in the good case, which is what the one I'm hoping for for the next …

AI assessment note: “can this person be my first call when shit hits the fan?”

Q Okay, a 110. That's a lot of cash. Um, how have you stayed mentally and financially lean and constrained with, bluntly, a lot of capital injected into the company in a relatively short amount of time?

A It's a great question. Um, we, um, so here's what I would say. Uh, Luan and I have a scarcity mentality. Like, we know, um, uh, Like, it's really quite simple. We just don't really consider that we raise that much. It's just, you know, we, we, in our mind, we're basically raised much less. We have, you know, like a certain roadmap for two years. We basically cap our burn very, very aggressively. Like everyone around us says, oh, you're not going aggressively enough. You're not growing the team aggressively enough. And we're like, no, no, no, this is how much, this is how much we're burning a month. And this is the number of sides of the team. And I think we, we do have like a, I would say pretty hard, hard discipline around being like run burn and being frugal. I, I, you know, and I think it comes a little bit from this kind of immigrant mindset where you're kind of always worried that shit things are going to shift and like money is not going to be there for long and all these different things. Um, so, you know, I don't know if this is a kind of like a super amazing answer, but, uh, it's, I think it's working. Um, you know, like the only negative is basically mostly like the only negative is you get more pressure from everyone around you, from The team from investors, like, you have all this money, why are you not spending more? Like, you got that pressure of, like, you know, …

AI assessment note: “Luan and I have a scarcity mentality... We basically cap our burn very, very aggressively.”

Q The hardest days of the stories that you tell. Um, Did you ever like doubt your leadership?

A The answer is yes. Right. So, so at times, even, even today, I mean, you always doubt like, because as, as you know, when you're building a company that's just going after a large market and, you know, first not working or then it starts working and then it goes back to not working and then you do that 10 times and then, then it works really, really well, but then everything starts breaking and, uh, um, and this is maybe the phase we're in and then you start fixing some of the things, but then more things start breaking. You have to continuously kind of shift yourself as founder and then CEO, um, and evolve yourself. And there's always questions like, am I going to be able to kind of do this next phase? Right.

AI assessment note: “The answer is yes. Right. So, so at times, even, even today”

Q And, and like, what are you not sure that you're able to do today?

A I think that for us, it's, it's the time at a company where we need to evolve into sort of like into a more structured organization, um, and build the right set of processes and systems and the company. And we haven't done that before. And, you know, we'll, we'll, that's kind of the next big challenge, which is like, you know, am I going to scale to the occasion and, you know, be able to do it while, you know, keep accelerating the growth of the company and not sort of compromising the growth. And that's a hard problem. And the reason why these problems are hard is there's no answer, right? Like there's no, there's no recipe. There's no book. It really depends on you, your company, the circumstances. You have to kind of go through it and you have to go, you have to make a bunch of mistakes, uh, as you go through it. Um, and you never know if it's gonna work out exactly the way that you want it to work out. Um, so.

AI assessment note: “am I going to scale to the occasion and, you know, be able to do it”

Q Dude, how much of Calci's activity is sports betting? And how do you respond to people who say it's just a sports betting platform?

A It's pretty similar to what happened last year, actually. So last year it was, you know, the question I was receiving is how much of the activity is elections? And, you know, obviously a lot, right? Like that was the big talk of the, like, in the way I would answer it is like, well, how much of the attention right now is in the election? Like in terms of like what people were talking about in October, 20, 24. And if you think about it, it's like, well, out of 10 tweets I see on Twitter, 9.5 tweets were about the election, right? Like, so maybe that will correlate with the volume on Calci, and it did, right? It was, it was exactly that. And you're seeing the same thing happen with sports, but like per unit of time, it really is about what is most on top of people's minds. So yes, Sunday, NFL Sunday is massive in America, and that's on top of people's minds. Um, but when there's a Fed decision, that's on top of people's minds, and that's where the trading volume is. When there's a Mamdani election, That's when the trading volume is. So the volumes will basically ebb and flow with whatever is in the news, whatever is trending on X, whatever is top of people's minds. Um, and I think it's a matter of time until basically like, you know, we're seeing incredibly strong evidence or traction in the culture markets, for example. I actually think like what's happening with Taylor Swift, y…

AI assessment note: “So the volumes will basically ebb and flow with whatever is in the news”

Q Can I interrupt you and say at that moment of prioritize, how do you determine what your next step is? Is it, we will lose 10,000 dollars if we do this? Is it we'll lose two weeks of engineering? How do you determine what dictates your next step?

A That's a great question. Um, I don't have the unifying key yet. I don't want to overstate it. Uh, you know, I, I love Elon's, which is like, you know, does this get, get us to Mars faster? And I think that's really cool. Um, but, but I think broadly speaking, you know, if I were to kind of distill it into, um, into one or two things, um, it is usually around, um, expanding the category somehow, which is still kind of the same thinking as what we had initially when we started a company, which is like, okay, we have this ecosystem that's events. And the way I view the event ecosystem is, you know, you have stocks. Right. You have, you know, futures, like grain futures, then it became metal, metal and oil futures, like tangible commodities. Then you got intangible interest rate swaps, which is a 500 trillion dollar market now. And then you have events, which is this idea of commoditizing anything. I just constantly, my mind is always going into like the ecosystem. It's not a number of users. It's not revenue. It's not financials. Is this next step basically helping us bring more people into the ecosystem or expand the ecosystem, bring in a new market, bringing something else. And I just feel, and the reason I think about the ecosystem, not the company Scalshi is because right now we're the only ones. I mean, you know, we basically pierce this regulatory thing and we have pretty st…

AI assessment note: “Is this next step basically helping us bring more people into the ecosystem”