The Exchanges

Q What are those robots cost? What's the range of the hardware cost, and then what's your business model with these? People buy them and rent the brain. They rent it by the hour. What do you think of as the CEO will be the business model? And what is the business model with these hundreds or dozens of customers deploying hundreds of these?

A Yeah. So we, um, we, we went with a CapEx model to start with Spot. Um, we'll be doing a, probably a robot as a service model, likely with Atlas. Um, we understand through the humanoid form factor, folks may want to spin up at different times and then, and have the ability to, to do decrease. Um, with Spot, it's been pretty effective in CapEx. Um, it's the way these industrial customers think about industrial tools. So they generally want to spend CapEx for this. Um, it depends on their configuration. You know, it ranges anywhere between, you know, a 100,000 dollars for the base robot, all the way up to 300,000 when we're fully loaded with services, integration deployed.

AI assessment note: “ranges anywhere between, you know, a 100,000 dollars for the base robot, all the way”

Q Yeah. Well, maybe tell me why you started Chewy. How'd you get that idea? And how'd you get into building this business from where you were coming from at that time?

A We were, um, wanted to build something online and we were, uh, about to launch an online jewelry website. Did not know anything about jewelry. Went to a bunch of trade shows, bought hundreds of thousands of dollars worth of inventory. Built the website, had the distribution, and then I was shopping in a neighborhood pet store. Uh, I had a poodle, and I was going every few weeks, and It just hit me on one of my trips that I understood the product much better. It was a recurring revenue purchase. The market was still fragmented. The fact that there was still neighborhood pet stores at the time, and they had not been disrupted by Petco and PetSmart was fascinating to me. And then you had to eat, you had Amazon, which was established and had pet products since the nineties, but they hadn't really achieved real scale in the category. The vision was to replicate the same experience that I had at the neighborhood pet store, but do it online and do it at scale. And I looked at Amazon's best practices when it came to supply chain. So fast shipping, having a great selection, being competitively priced, and then the experience at the neighborhood pet store. Of knowing the products really well. And it was easy to be passionate about the pet category because I'm a pet owner and everyone we hired were pet owners. And the, it was all about market leadership as a low margin business. Hindsight…

AI assessment note: “It just hit me on one of my trips that I understood the product”

Q Yeah, it's like playing poker with Alan Keating. It's just like, how is this guy solvent? He's literally playing every hand of poker, he's losing tons of money, and then all of a sudden, by the end of the night, he hits two big pots, and he's got the nuts both times, and he pulls out of the stall. What's your take on the market today, Chamath?

A Yeah, I mean, I'll just do it again, but I think the, the Shiller PE, Nick, I sent it to you, shows near all-time highs. Then the second is the Buffett Index, which is the sum of all, uh, U.S. equities divided by GDP, is also at all-time highs. So this would generally mean that you need to be increasingly a little bit more risk off. But then the opposite side of that, and I sent you a third one, and this is why it's so confounding, is you have signals showing everything, which is, which typically doesn't happen. And this is this dispersion point where when you see this performance and it's up five percent in the first, you know, half of April, typically the market is up almost 32% on average for the rest of the year. And we were already up, as Sac said, you know, Seven and a half percent already.

AI assessment note: “you have signals showing everything, which is, which typically doesn't happen”

Q Dragons in every Sunday. Brad, you're, uh, sorry. Brad, you're an investor in this company. Is this virtue signaling or is it reality? Is this a good move by them to not release this model and be thoughtful, give it to a handful of people, and just find all the bugs it can before releasing it to the public? And we've got a lot more issues to discuss about this.

A I mean, I, I, I actually think they deserve A ton of credit here, and let me walk you through why, right? They, the company could have just released Mythos, broken a lot of core things on the internet. Oftentimes in Silicon Valley, we say move fast and break things. In this case, it means just releasing the model to move further ahead of your competition, but here the company realized it would wreak havoc. They ran their own vulnerability testing. They saw that it would allow offensive hacking and people to expose browsers and browser history, expose credit cards, you know, on, on the internet. You know, what I like about this is they didn't need government to hold their hand on this. We have plenty of government regulations. They know it's in the best long-term interest of the company and the industry, you know, so they set up Project Glasswing. It's an AI-driven, you know, kind of cyber coalition. Apple, Microsoft, Google, Amazon, JP Morgan, 40 of the most important companies, and their goal is very simple. Let's spend a hundred days, use advanced AI, To find and to fix and to harden these software vulnerabilities before hackers exploit them. Now, what I think this represents, Jason, is a threshold that we're crossing. Mythos and Spud, which is going to be out from OpenAI any day now, which is the first Blackwell-trained model at OpenAI, they represent the beginning of what I…

AI assessment note: “I actually think they deserve A ton of credit here, and let me walk you through why”

Q So what was the motivator then for change in the construction of the landscape of defense contracting? Was it software that takes us from the old primes to the new primes? Is that really what kind of triggered this?

A Consolidation. So in 93, having won the cold war in 91, or I think more accurately, the Soviets lost the cold war, you know, by 93, we expected as a nation, a kind of peace dividend. We don't have an adversary. Now we should be able to spend less on defense. And, uh, the department had this famous dinner where they brought 15 of the 51 primes together and said, this is gonna happen. The budget's gonna get slashed. We're not going to save you guys. You have our permission to consolidate. Some of you are going to go out of business. Some of you should try to make a commercial business, which didn't really work. Uh, and that's what led down to five. It was actually, there was going to be, we were going to go from five to four and 99, the justice department put their foot down and said, we're not going to let Lockheed and Northrop consolidate.

AI assessment note: “Consolidation. So in 93, having won the cold war in 91”

Q people are saying that Silicon Valley is taking over Defense and Silicon Valley is the next story of the American war machine. This has become sort of a popular narrative. Can you just respond a little bit to kind of where we were coming out of World War II from a defense industry perspective, where we find ourselves, where Silicon Valley seems to be at the center of this today?

A You know, the industrial base that won World War II and the early Cold War was not a defense industrial base. It was an American industrial base. You know, Chrysler made the Minuteman ICBM. They were the prime contract on it, and they make minivans, so missiles and minivans. General Mills, the cereal company, had a mechanics division. Everything they learned doing R&D to process grains, they actually used to build torpedoes and inertial guidance systems. Ford built satellites until 1990. So the entire economy was invested not only in economic prosperity, But also underwriting the freedom that allowed us to have economic prosperity. It's really a consequence of the end of the Cold War. So when the Berlin Wall still stood in 1989, only six percent of spending on major weapon systems went to pure play defense specialists. 94% of it went to what I call as dual purpose companies. You know, yeah, a missile is single use. It's not a dual use product. You're not going to buy it at Walmart, but that actually these companies were invested in both parts of this. That figure today is 86%. Goes to defense specialists. So we have a very different structure of the U S economy as a result. And I think it leads to very perverse narratives of what would it be like to mobile? If things got really bad, we'll just flip a switch and our auto factories will magically turn into enabling us provide for…

AI assessment note: “the industrial base that won World War II and the early Cold War”

Q So let me push back before we go and ask you to identify any risks or threats or downside risks in all of this. What should we be worried about, if anything, with regard to AI usage?

A Well, I think there are Orwellian scenarios, uh, of AI that I think we should be concerned about, and again, I, I tend to think that those scenarios were described by George Orwell, not by, you know, James Cameron and the Terminator, and specifically, it's misuse of AI by government. I do think that AI could be used as a tool to, um, surveil, to censor, To even potentially brainwash the population. This is why the administration has taken such a firm stance against what it's called woke AI, which I almost think that that name maybe trivializes the magnitude of the problem we're talking about. We're talking about AI having a political bias built into it. Um, and the bias can be so subtle that people don't even necessarily notice over time, but it has a huge impact on what people are allowed to learn and think and know and what, you know, children learn. And so I think it's very important that we try to make sure that AI was blatantly unbiased. Um, there, just in this regard, one of the things that we were so concerned about with that by an executive order on AI that we were sending in the first week is that it had 20 pages of language on DEI, and it was promoting this idea that AI models need to build in a DEI layer. Well, you know, this is how you ended up with, you know, the, the, the Black George Washington Uh, you know, story where the, the first version of, of, uh, Gemini c…

AI assessment note: “I think there are Orwellian scenarios, uh, of AI that I think we should be concerned about”

Q And what about China? Can you share a little bit about China's relationship with Venezuelan leadership and Maduro and when that became a more kind of intimate economic tie?

A Well, Venezuela turned to be China's main debtor with over 60, 60 billion dollars in debts that, you know, accounted for all kinds of different projects that were never built. And, and certainly China realized that Venezuela's, you know, natural endowments are unique. Absolutely unique. It was strategical. Um, nonetheless, uh, the, the degree of corruption in the system and in this system is so, so big that China stopped funding Maduro about seven years ago and simply is getting, you know, the oil to, to pay for the debts that are still, um, pending. Um, I, I, I believe China, you know, understands the, the, the strategic importance Venezuela has also for its geographic location. Um, but, but has been more prudent because of the degree of, of corruption that they have suffered from, from Maduro and, and the regime. But there's also the side of the, you know, the intelligence, uh, spionage, uh, and technology and satellites From China that have been installed in Venezuela. That's a very important dimension for Venezuela.

AI assessment note: “Venezuela turned to be China's main debtor with over 60, 60 billion dollars”

Q But the other things, like the overproduction of the economy, tightening interest rates, the war debt, Like, all of this stuff was just commingled, and nobody fully understands that. Can you maybe give folks a precise representation of the setup, the setup?

A So let's just go back, even let's go back to 1919, because actually I think that's a critical year. So prior to 19 19 in America, people did not really borrow money. It was like a moral sin to, to, to get credit, but people didn't do it. In 1919, General Motors says, you know what, we're gonna start lending people money so that you can buy a car. And that was actually like a major inflection point in America, because then Sears Roebuck clocks what's going on and says, okay, we're gonna do this too for appliances. And then a guy named Charlie Mitchell, who ran a bank called National City, which becomes Citigroup, says, you know what, we can do this for stocks. So we, you know, And, and all of a sudden brokerage houses are opening up, you know, on the corners of streets the way we see Starbucks today. It's like literally like that. And you could go into one of these places and you could put a buck down and they would literally loan you 10 dollars Off of your dollar. I mean, that's how insane things were. And at the time.

AI assessment note: “let's go back to 1919, because actually I think that's a critical year.”

Q And so, so just tell us about how the decisions you've made now to build this business. How many people do you have? How do you run two hundred billion effectively? How do you raise 34? How do you, what do you tell people to raise thirty-four billion? I don't, I don't even, I don't even comprehend that.

A I think you do. Come on. You guys have done pretty well. I appreciate that. But, but it's, ah, ok, so we have, we are very, very focused on keeping the team Very small. So we have about 230 people at Toma Bravo within the organization. Um, the, the reason is you, if you have too big of a team, you become internally focused and start dreaming about conversations internally. And as I always say, the deal's not in the office, the company's not in the office, and the buyer of your company is not in the office. So you always have to be outward facing. The second thing is, I got the benefit and so did my senior partners of incredible mentorship. I can tell you so many stories about Carl Thomas spending time with me in 1998 on the deal we were going to lose. And I would be like, why did you spend all that time with the CEO and me on his kitchen table? He wanted to teach me how to sell. He wanted to teach me how to do a deal. And, and that was just incredible. So if we have too many of those, we can't, we can't touch the next generation leadership. So that is, that is part of our philosophy. Now, how do we raise that money? Look, our first deal, it's always been one step at a time. Our first deal was fifty million. The second deal was a hundred million enterprise value. The third was Datatel at two hundred and fifty million. We didn't buy a company in Silicon Valley till 2010. Uh, that…

AI assessment note: “we have about 230 people at Toma Bravo within the organization.”

Q That program, um, had some, that first cohort of individuals, um, wound up being a pretty interesting group of folks. Maybe you can tell everybody just a little bit about that Program you conceived of, and then who were some of the first folks in it, and the first investments?

A We conceived of this program, as you've mentioned, in 2010 when we launched it, and the idea was that there were a bunch of contemporary founders who had very interesting access to up-and-coming founders, who were turning to them for advice, but these founders didn't yet have money. At the point that you became a scout, you didn't have the net worth you have now, where you could write a check on your own, and so we thought it'd be a great program for us to provide the capital for Founders like yourself to be able to invest in those companies, and hopefully we would get an introduction to those companies for us to be able to make an investment too. So, uh, you were in that program. You helped us with the investment in Uber. Sam Altman was in that group as well. He helped with an investment in a little company called Stripe.

AI assessment note: “You helped us with the investment in Uber. Sam Altman was in that group”

Q Tell us about the venture industry, actually. So we're at a point in the cycle where there's been a lot of specialization, both maybe at the stage level, at the sector level. There's been all kinds of experimentation and approaches and strategy. Can you just level set on What you've learned and what the industry has learned and where we are?

A I'm glad you called it an industry, not an asset class. Um, I listened to one of the shows you guys had recently, and I think there's a huge problem with the venture industry that there's too much money. You guys have talked about this before. Uh, venture industry as a whole invests right now between a 150 to two hundred billion dollars a year was the last numbers I saw. If you think about reasonable assumptions for returns, it just said 12% Per annum net, which isn't great. Might as well invest in an index fund. The math basically implies that you need three and a half to four X funds to make that math work over a reasonable timeframe. So if you're investing, let's just say two hundred billion dollars a year, the industry needs to give back seven, eight hundred billion a year. VCs don't own a hundred percent of the company, last time I checked. So that means that the aggregate exit value is north of a trillion a year. So Figma went public recently. They're worth 25, twenty six billion dollars. You need 40 figmas a year for the industry to make the returns work, which means that they don't. So in my opinion, investing in venture is a return free risk. You shouldn't. They're basically only about 20 companies.

AI assessment note: “investing in venture is a return free risk. You shouldn't.”

Q all the things that might make a good venture capital investor, maybe as a public company, quarter to quarter, are they growing 12%, 14%? There's a different analytical skill set, some might argue, Like, you know, that, that belongs in that investment domain, and frankly, it's very hard to beat the indices doing that. What's the argument to be made to the counter, and why would you counter that argument?

A So, see, one of the things for us is that, I mean, in most of these cases, we're involved in these companies literally at inception. I mean, Palo Alto Networks was incubated inside our office with one founder and my partner, Jim Gates. So we've known these companies since the earliest of days. Why should that relationship end at the IPO? And in most of these cases, as you pointed out, the founders are still there, and there's so much more innovation taking place. Um, Jack Dorsey's, one of Jack Dorsey's favorite quotes to me was, companies have multiple founding moments. And so when you're in a company where the founder keeps reinventing the business, you know, a company like Square, half the revenue today comes from a product called Cash App that hadn't launched for the first five years in the company's life. And so if you can find these companies, these special companies where the founders keep pushing the boundary on innovation and they are relentless, then it works.

AI assessment note: “Why should that relationship end at the IPO?”

Q Uh, why don't you just ground people on where we get those things today? And, you know, like, what percentage comes from coal? What percentage comes from rat gas? What percentage comes from nuclear globally? Just so that we can maybe figure out where we need to go, and how do we get this, more of this stuff now?

A Yeah, so, so in 1973, and I use that year because that's the Yom Kippur War. That's when oil prices tripled. Later in the decade, they doubled again in the Iranian Revolution. So we said, we gotta get off oil and gas. So in 1973, oil, gas, and coal provided 85% of global energy, and last year, twenty-twenty-four, 85% of global energy. So they, and they've continued to grow. Over, over that, uh, 50 years, Natural gas has grown three percent compound annual growth rate. Coal, two percent. Oil, one percent. Oil is the most expensive and most flexible. Coal is cheapest if you don't have infrastructure. Natural gas can be the cheapest if you have infrastructure. So it's growing the fastest. Natural gas is the fastest growing energy source. So that's 85% from hydrocarbons. Four percent from nuclear. Used to be six in year 2000. And today, three percent, a little less than three percent of total energy comes from, ah, wind, solar, and batteries. Hydro's in there, geothermal's in there. The, the biggest component I didn't mention is traditional biomass. Burning wood. That is twice the total global energy of wind, solar, and batteries combined. Two billion people still cook their daily meals and heat their homes burning wood indoors. Two to three million easily preventable deaths a year to switch out that wood burning and liberation of women with just a simple propane stove.

AI assessment note: “85% from hydrocarbons. Four percent from nuclear. Used to be six in year 2000.”

Q topic, like, what is the difference between our point of view, which they have, no carbon in the atmosphere, spend all the money to keep that from happening, and our point of view, and I just ask for, like, like, help level set a little bit on What's the point of view on where carbon goes in the atmosphere over time, and how important it is to, to mitigate that?

A So like everything else, it's about looking at the facts and the numbers and the data. It's, we, we don't want to be cute like China. We, and of course, I, I think you misunderstand China's plan for wind and solar, but we want to look at the facts. How big of a deal is climate change today? It is a real physical phenomenon. We've raised atmospheric CO₂ concentration by 50%. Um, from, from burning hydrocarbons, from developing a modern world. It's a real thing. It absorbs infrared radiation. It's contributed to some warming. But if you look at the math and the economics of it, it's just not even close to top 10 problem in the world today. If you look at the Intergovernmental Panel on Climate Change Economics Projections, to the end of this century, nobody knows what the world's going to look like in the end of the century, but think of the Intergovernmental Panel on Climate Change. These are the people that are dedicating their lives To work on climate change. Their estimates range from 0.2 to maybe three, four percent reduction in per capita income at the end of this century. So that's in 75 years, we might lose a couple months, we might lose a year of economic growth in 75 years. That's a bummer. It's not nothing, but compared to two to three million people dying simply because they don't have a clean cooking stove, And, and of course, the, the political movement that's too fo…

AI assessment note: “it's just not even close to top 10 problem in the world today.”

Q I mean, are these riots more or less than a Lakers championship? Uh, how concerning are they to you? Who's to blame?

A Well, as measured by violence, they're less profound than, you know, what happened in 2020 after George Floyd died. They're way less dangerous than, say, the Watts riot, um, or the Rodney King riots in LA, but they're much more profound. I mean, it, it really does, there's certainly a bigger deal than anything can happen in Fort Sumter, for sure, which kicked off the bloodiest war in American history. The federal government has, as a core duty, Uh, the right and responsibility to enforce immigration law and police the borders. That's what the government is. That's what the federal government is really. And so if you can test that, it is like a threat to disunion fundamentally. I mean, I think there's a lot at stake and we reached this point because a series of paradoxically weak federal governments allowed sanctuary cities to continue literally for decades, each one its own form of insurrection against the central government and maybe Maybe you don't believe that the federal government has a right to pass laws restricting immigration. It's not in charge of the integrity of the borders. You know, that, that's a kind of philosophical or constitutional case I guess you could make, but most people accept that those are federal duties, and once you accept that, you can't allow states or municipalities to flout the law any more than you could allow Central High School in Little Rock …

AI assessment note: “a series of paradoxically weak federal governments allowed sanctuary cities to continue”

Q And, um, let me ask you one more question as we kind of Get to the end, but, uh, what's been the most surprising thing for you in this role since you've, um, since you've been in office?

A The national security aspect. That I, I would say, 40, 50% of my day, uh, Treasury does a lot of national security work. Whether it's CFIUS in terms of, uh, foreigners who want to buy U.S. assets, whether it's sanctions, whether it's OFAC, Uh, anti-money laundering. We, we've just designated the Mexican cartels as foreign terrorist organizations. Uh, we, President Trump, over the weekend, launched a very, uh, aggressive strike on, missile strike on the Houthi assets. Well, underneath that, we'd already been working for several weeks on their bank accounts. I see. So, or anyone who is adjacent to them. The Iranians supply the Houthis with the, their ecosystem Previous to my getting here, uh, treasury had disrupted the ecosystem so much that, uh, the Iranians used to hand them cash. Now they're just handing them here, take, take this oil tanker and try to sell it. Right. So there, there is the ability to, to break that down.

AI assessment note: “The national security aspect. That I, I would say, 40, 50% of my day”

Q Did you see the same thing happen with storage? I remember in the early days with Box and Dropbox and YouTube, you all had This major innovation with storage, and how did that play out?

A Let me give you a fun stat. We give our customers unlimited storage. We have 82% gross margin. So, so the, the, what, what happened was the price of the underlying storage has gone down by hundreds of times since we started the company. And then our, all our value is in the software layer on top of the storage. So we've benefited by this incredible, just, you know, ruthless competition between Western digital Seagate, other players that are just trying to pack more, more, more, you know, basically more, more, uh, storage density into these drives. And every couple of years they have a new break Through we're now, you know, upcoming, we're up, we're heading toward maybe a, a 50 terabyte hard drive. When we started the company, they were kind of 80, uh, 80 gigabytes.

AI assessment note: “what happened was the price of the underlying storage has gone down by hundreds”

Q John, what's, what's your thought on that? Do you see any difference between, uh, Republicans and Democrats?

A No, I like to refer to the Republicans and the Democrats as Tweedledee and Tweedledum. There's hardly any difference. I actually think the one exception is that, uh, former President Trump, when he became president in 2017, was bent on beating back the deep state and becoming a different kind of leader on the foreign policy front, but he basically failed, and he has vowed that if he gets elected this time, uh, it will be different, and he will beat back the deep state, he will Pursue a foreign policy that's fundamentally different, uh, than Republicans and Democrats have pursued up to now. And the big question on the table is whether or not you think Trump can beat the deep state and these two established parties. Uh, and I'd bet against Trump.

AI assessment note: “No, I like to refer to the Republicans and the Democrats as Tweedledee and Tweedledum.”

Q Does that sound like a fair, a fair way to describe the art?

A If you can just do two terms, I'd say, yeah, evolutionary biology meets the problems of modernity, but if we can add in evolutionary psychology meets anthropology and cultural psychology, um, with a little smattering of sociology in the head of a guy Who is just really bothered when he sees systems and institutions screwing up, messing up, and he thinks to himself, wait, if we just did this, it would work better. And so I get deeply involved in, in what's going wrong with our democracy, and that's, that's the righteous mind. What's going wrong with our universities? That's the coddling the American mind and my project at Heterodox Academy. And now what's going wrong with family life and children and people born after 1995? So, I would just put a few more terms in there, but yeah.

AI assessment note: “I would just put a few more terms in there, but yeah.”

Q Freeberg, you got thoughts on this? Market manipulation, or meme, stonk, fun, good times, you're buying GameStop, you're buying AMC, like, buyer beware, you're, you're, you're in on the joke. What are your thoughts?

A Nick, can you pull up the image? I'm gonna talk about the stupidity of buying the stock of this company at this valuation. This is a, uh, company, and, and then I think we can talk about whether that's even relevant, which I think the indication is that it's not. GameStop finished the year, 20, 23 fiscal year, with Sales of 5.3 billion down from 5.9 billion the year before. So sales declined by 12% in the year. Adjusted EBITDA. Adjusted EBITDA for the year was sixty five million dollars, and they have about 1.2 billion in cash. Currently, as of today, the market cap is about 13 and a half billion dollars. So that makes it about a 12 and a half billion dollar enterprise value. 12 and a half billion divided by sixty-five million of EBITDA means that this stock is currently trading at about a 192 times EBITDA. A business that is profitable and you can say that the profits are stable and predictable and is likely not going to grow very much, will typically trade for seven to 12 times EBITDA. And this stock is trading at a 192 times EBITDA and the revenue is declining 12% a year. So I'll just point out, like, I don't think that there's anything about the actual performance of the underlying business and the security that you are buying or selling when you are making a decision about whether or not to buy or sell the security. And I think that that's the real question. Does that even…

AI assessment note: “Let people have fun. Let them go to Vegas. Let them play in the roulette table.”

Q Have you seen this, um, clip where Yann LeCun basically says our best LLM is 50 times smaller than what a four-year-old has processed since they've been born?

A A four-year-old is awake, has been awake, a total of 16,000 hours. And you say, okay, 16,000 hours. Multiply this by 3600 seconds per hour. And then figure out, like, what's the, um, bandwidth of the optical nerve going to the cortex? It's about 20 megabytes, right? You have one million nerve fibers per, uh, per eye, and it's about 10 bytes per second, right? Give or take. Um, so multiply, that's 10 to the 15 bytes by the time you're four. 50 times more than whatever LLM, like the biggest LLM in the world, I've been trained on, ok? So, what that tells you is that in the space of a few months, The baby has seen more information than the biggest LLMs that we have.

AI assessment note: “The baby has seen more information than the biggest LLMs that we have.”

Q This is, this is the first investment, I think, where we're all on the cap table, right? So we can, we're all rooting in the same direction. What's happening in the developer side? How's the momentum going?

A Well, the momentum's incredible. You know, we have now 16,000 plus developers in our, you know, self-serve playground. There's well over like a thousand apps that people have developed using the API and all kinds of new functionality. You know, the API allows people to get A higher rate of throughput on tokens and low latency. So there's all kinds of new applications from voice to real time translation of web pages. You know, we're collecting them on our discord. We have, you know, 3000 people in the discord as well. It is a real community that's come together building around Grok. And what I will say is, you know, sort of the same jump that developers saw when we went from dial up internet to broadband, they're seeing that now and from using like traditional APIs for LLMs to using, you know, the ones that we offer.

AI assessment note: “Well, the momentum's incredible. You know, we have now 16,000 plus developers”

Q I love your point Saks though, about fund size dynamics, fund size dynamics are destiny, right? It really is. And the optimal fund size for venture is somewhere between 256 hundred million according to everybody who's been doing this. For, you know, more than a decade or two, and who's successful, whether it's- Well, and the costs are coming down.

A So as the input costs come down, whether it's for engineers and co-pilots and, and hardware and abstraction layers, then theoretically, greater outcomes should be generated with fewer dollars in, which would again, tell you that fund sizes should actually go down, not up. That the reason they go up is because you get paid an annual management fee. And so obviously the way to wait, the way to make more money Is to get two percent on a larger fixed number every year versus two percent on a smaller number. Or, you know, for example, what we did was we were like, we're going to go and hit grand slams. And so I traded off management fee in return for 30% carry. And that turned out to be literally a multi-billion dollar smart decision because I gave up tens of millions of dollars up front for back end. Now the back end could have gone to zero and maybe it still can. So who knows? But, you know, most folks wouldn't do that. Most folks take the sort of risk adjusted bet and say, you know what, I'll just take the two percent and I'll raise a two hundred million, then a five hundred million, then a billion, then a two billion dollar.

AI assessment note: “greater outcomes should be generated with fewer dollars in, which would again, tell you that fund sizes should actually go down”

Q versus the modern left. It's a Volkswagen, uh, bus with a bunch of hippy dippy flowers, and it says free speech, free love, 1971, no CIA, screw the establishment, resist authority, and then it shows like a modern SUV with 2021, it says masks up, I heart the CDC, obey the establishment, no free speech, do what you're told, obey, basically. You have another poll you want to share sex?

A Well, yeah, this is a really interesting one. It says a majority of voters, 55% say COVID should be treated as an endemic disease, while a majority of Democrats say it should be continued, continue to be treated as an emergency. And then there was a similar poll, the Monmouth poll just came out, where 89% of Republicans, 71% of, of independents, say that it's time we accept, we accept COVID is here to stay, and we need to, uh, get on with our lives. Only 40% of Democrats. Sure. The reality is that the rest of the country, I think, has moved on. It's ready to move on. The split is not between Democrats and Republicans anymore. It's within the Democratic Party. The Democratic Party is now divided on this question of whether we should move on as a country past COVID. Half of the Democratic Party still believes that COVID should be treated as this emergency.

AI assessment note: “Well, yeah, this is a really interesting one. It says a majority of voters”

Q Freeberg, you have lots. Watching all this. I know you don't like when we delve into politics too much. But what do you have any thoughts you want to add?

A Yeah, some of it's about politics as much as I kind of use a little bit of a startup analogy, like America never really found product market fit with what we were trying to do in Afghanistan. There's some fantastic, um, Gallup polling that's been done in Afghanistan over the past, uh, 1520 years already, and they've actually had people on the ground polling there. And most recently, which has been consistent for over 10 years, polling shown that 87 to 90% of Afghans said that the government is corrupt. This is the government, you know, put in power, put in place by the United States. 90% say businesses are corrupt. And if you go back to a poll they ran in 2010, the question was, in general, which of these statements comes closest to your point of view? Sharia law must be the only source of legislation. 56% of the Afghan population in 2010 believed that to be true. And another 38% said Sharia law must be a source of legislation, but not the only source. That leaves just seven percent of people that think that Sharia law should not be

AI assessment note: “America never really found product market fit with what we were trying to do in Afghanistan”

Q by the local community, and these cameras are installed by a local community. The communities I've lived in have had them. So let's answer these two questions. Number one, how does a community wind up having flock cameras installed? What's that decision making process like typically? And then we'll get into very granularly what you're recording, for how long, who has access, the audit logs, and then what's not recorded?

A Yep. No, that's a, it's a great question. So, you know, one of the reasons, uh, Jason, we struggled so much to raise money as a business is because it is traditionally, and was for Flock, very hard to get contracts done with local government. You know, the last company to go public that serviced local government It was over 20 years ago. Um, this is a really hard space because city councils have the final decision. And so every two weeks a city council meets and they're, you know, the city manager's direct reports, be it a police chief or fire chief, uh, public works presents ideas, presents, uh, concepts they would like to get approval for. And Flock is on that list. And so I think last year we went, we went to something close to 10,000 city council meetings as a business. I have a huge team whose entire job is just going to city council meetings explaining what Flock does and what Flock doesn't do. Um, and, and it's just a, it's just the cost of doing business with local government. Um, so it's really straightforward. Um, and I was actually talking to the chief, our first ever police chief down in Jersey Village, Texas. I was talking to him a couple of weeks ago. And like that video, that council vote six years ago is still public record.

AI assessment note: “city councils have the final decision. And so every two weeks a city council meets”

Q Yeah. And the Corsair, which is my favorite ship, just based on the name, I believe for my research, this meat was originally meant like a pirate ship or a privateering ship, but it's, Is it now standard lingo that that's a 24 foot boat and has a certain profile, do you know? Is that how these designations come about? The names of these ships?

A I mean, I wouldn't say that Corsair is now universal 24 foot autonomous surface vessel. It's the name of our product lines, and we chose it very purposefully, and we chose all our names purposefully, even the name of the company. I mean, we were talking about, you know, our Greek heritage before the show and where that came from. You know, the Saronic Gulf is a Gulf off the coast of Athens where the Battle of Salamis happened. It's one of the most famous naval battles in history. It came after the Battle of Thermopylae or the famous stand of the Sparta, 300 Spartans. And it was the naval battle between, um, the Greeks and the Persians where the Greeks were wildly amassed. The Persians had much, much larger ships. They had a much larger fleet and the Greeks were able to lure them into this narrow strait. And use smaller, more maneuverable products to ultimately, uh, defeat the Persians.

AI assessment note: “I wouldn't say that Corsair is now universal 24 foot autonomous surface vessel.”

Q it. But if you're up against an adversary who says, Hey, no, no, we built this thing. Anybody comes in to the blockade in Taiwan, which, you know, we think is, uh, you know, a pretty significant non-zero probability in our lifetime. If you're up against Somebody who says, I'm just going to have these ships kill anything. That's not our ship. Period. Full stop. Then we lose. Don't we?

A No, because the, the technologies that all you're doing is putting policy thresholds and approval thresholds into the technology. There's a real world scenario where doomsday scenario, we go to world war three, the Taiwan straight is a complete conflict. Exactly what you said. Our commanders are going to make that same judgment. Right. They'll be like, hey, if anything, there's no fishing boats out here right now. Yeah. There's no cruise ships coming through the Taiwan Strait. If you're not a, if you're not a friendly vessel, you're an enemy vessel, and that's that. And our technologies actually enables that. What we were talking about earlier is like the autonomy, the artificial intelligence, and everything else is there, and you're building the policies into the software based on government procedures and when those authorizations need to be in place. Those authorizations will change based on The threat environment that we're in.

AI assessment note: “No, because the, the technologies that all you're doing is putting policy thresholds”

Q Um, it was- You had to show up, what, two hours early to get in? Three hours?

A I am, I am not a particularly prompt person. No, I got, I'm not, wasn't going to miss, so I got there at like six, six oh five for an eight 30 game. Yeah. Lined up. You're supposed to get in on sixth avenue and 33rd, and I was like on sixth and 30th or 29th. It wasn't the worst. It wasn't the least efficient process I've ever seen. New York has a way of getting things done, and you just kind of like follow people. And, and once you get in, I mean, it was like literally TSA security. They like literally like look at your wallet by hand and they take your lighters and, and, and your pens and your vapes and everything like that. And, uh, Once you get in, it was pretty normal. I did feel like the crowd was a little bit fatigued by the second half, which was a choppy second half where there were some questionable officiating decisions. I actually.

AI assessment note: “I got there at like six, six oh five for an eight 30 game.”