Oct 4, 2024 · 50m · more-or-less
#67: OpenAI Sets a Record and Will Apple Make Its Next Move? · More or Less Podcast
Dave Morin · 14m spoken Sam Lessin · 13m spoken Jessica Lessin · 8m spoken Brit Morin · 8m spoken Podcast Theme Singer · 9s spoken
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gold bands on the timeline = statements, start to end. Hover to read, click to jump. CC turns on captions
In this episode of the More or Less podcast, co-hosts Dave Morin, Sam Lessin, Brit Morin, and Jessica Lessin break down OpenAI's record-breaking funding round, evaluate Apple's on-device AI positioning, and debate whether generative coding tools commoditize software or empower a personal software revolution. Alongside deep technical analysis, the panel examines venture capital fund economics, California policy decisions, and technological insights from Japan.
How this conversation actually went
Every chapter scored 0–10 on four independent dynamics. Hover any point for the reasoning behind the score. The hosts hold 99.6% of the talking time here. How this is scored →
The hosts as informed peer 5.9 Guest teaching 4.3 Guest disagreement 4.8 The hosts pushing back 5.0
speaking balance: gold is the hosts, purple is the guest (3 minute bins)
Sharpest disagreement ▶ 30:35 Sam calls Dave and Brit 'the Morins'
Sam forcefully rejects Dave and Brit's thesis that personal software creation will spark mass innovation, asserting that software is cheap commodity and bluntly mocking their stance with family name wordplay.
Hardest push from the hosts ▶ 30:15 Dave challenges Sam's creator economy contradictionDave refuses to let Sam dismiss developer democratization, directly confronting Sam's own investment focus in the creator economy and calling his dismissive conclusion insane.
Biggest teaching moment ▶ 11:10 Dave contextualizes secondary liquidity with Facebook historyDave breaks down the financial realities of employee retention and 'capital years', detailing how secondary liquidity was deployed during Yuri Milner's round at Facebook to keep executive talent from departing.
The host holds their own ▶ 33:50 Dave categorizes AI models into clear operational bucketsDave demonstrates technical domain mastery by moving beyond vague hype, categorizing the AI ecosystem into fast, slow, edge, and on-premise models with distinct competitive dynamics.
the scores for every segment, with the reasoning behind each
| Chapter | Topic | The hosts as informed peer | Guest teaching | Guest disagreement | The hosts pushing back | Why |
|---|---|---|---|---|---|---|
| "More or Less" Podcast Animated Title Sequence | 2 | 1 | 3 | 3 | The segment begins with playful bantering over the Twitter meme account 'VC Braggs' and Sam being accused of being its main content generator. The dynamic is purely humorous rapport with low technical depth and light-hearted teasing across hosts. | |
| The Half Moon Bay Golf Trip and Alaska Ski Contest | 3 | 2 | 3 | 2 | Discussion centers on VC golf culture versus traditional startup extreme sports and an impromptu listener ski contest to Alaska. Banter remains casual small talk until Jessica steps in to steer the conversation back to serious tech news. | |
| OpenAI's $6.6 Billion Mega-Round and Employee Secondaries | 7 | 6 | 5 | 5 | Jessica and Dave dissect the mechanics of OpenAI's massive $6.6B round and secondary share sales for employee retention. Dave and Sam draw nuanced historical parallels to Yuri Milner's tender offers at Facebook and private market liquidity dynamics. | |
| AI Model Strategy: Slow Reasoning, Fast Search, and Google NotebookLM | 8 | 5 | 4 | 6 | Dave lays out a strong thesis on product divergence between slow-reasoning models and fast-retrieval engines, citing Google's NotebookLM UI shift. Jessica pushes back on whether consumers tolerate latency, prompting an informed debate on context windows and user retention. | |
| Apple's On-Device AI Strategy and the Consumer Experience Debate | 7 | 5 | 6 | 6 | Dave argues that Apple is an overlooked dark horse using localized on-device LLMs that bypass expensive cloud APIs. Sam pushes back aggressively, questioning whether summarizing text messages provides any real step-function utility for consumers. | |
| AI in Healthcare, Sam's DEXA Scan, and the David Protein Bar | 4 | 4 | 5 | 5 | Brit advocates for AI health diagnostic breakthroughs, but Sam dismisses the premise, arguing lack of longitudinal data means AI will just recommend eating more protein. The exchange devolves into humorous ribbing about Sam's DEXA scan and protein bar endorsements. | |
| The Personal Software Era vs. Commoditized Code | 8 | 7 | 8 | 8 | A heated philosophical clash erupts over the personal software era: Dave and Brit contend AI coding democratizes development for millions of non-engineers, while Sam sharply dismisses this, arguing software is being commoditized into irrelevance and calling them 'the Morins' in contrast to 'the Lessins.' | |
| Apple's Incumbent Strategy and the Four-Category AI Taxonomy | 8 | 4 | 3 | 5 | Dave introduces a structured taxonomy dividing the market into fast, slow, edge, and on-premise enterprise models. Jessica synthesizes the capital expenditure realities and challenges whether incumbent tech giants have over-promised. | |
| Venture Capital Realities, Fund Sizing, and CRV's Capital Return | 7 | 5 | 3 | 4 | The panel analyzes CRV returning $275M of its $500M fund, explaining how mid-sized funds sit in an unviable 'no man's land' between agile seed funds and mega-funds. Brit and Sam detail LP barbell allocations and fund economics. | |
| California Policy: Fertility Mandate and AI Regulation Veto | 6 | 5 | 7 | 7 | After touching on Newsom's veto of SB 1047 and fertility mandates, conversation pivots to Japan's declining birth rate. Dave relays Japanese perspectives on demographic decline, but Sam aggressively attacks the premise as propaganda, sparking a geopolitical debate over U.S. defense guarantees. | |
| Japanese Abacus Math Prodigies Outperforming AI Technology | 5 | 5 | 6 | 5 | Brit and Dave praise Japanese abacus school prodigies doing rapid mental arithmetic, claiming they outperform AI. Sam downplays the accomplishment as basic parlor tricks rather than genuine software engineering capability. | |
| Startup Pitch Misunderstanding and The Movie Her Reference | 6 | 3 | 4 | 4 | Sam shares an anecdote about misunderstanding a dating startup pitch referencing the movie 'Her'. Brit and Dave then share medical imaging breakthroughs in cancer detection from their trip before Jessica wraps the episode. |
Statements from this episode (26)
Sam Lessin provides content to anonymous creator of @VCBrags
“I have no idea who it is, but the person behind it and I are in close contact because I provide fodder for him, and we like to share notes.”
Sam Lessin: Venture capital is becoming asset management and investment banking
“And I was like, of course, because as venture capital just becomes traditional asset management investment banking, the last step to total conversion is to play golf.”
Sam Lessin: Remote work allowed older VCs to preserve their fiefdoms
“They should have retired a long time ago, and they would have if it weren't for work from home culture and COVID, but work from home, they preserved their fiefdoms from home while they play golf, and like, we need to kick them out.”
Brit Morin: OpenAI exclusivity demands will drive investors to competitors
“Like it, I think it actually sends People to the competitors.”
Dave Morin: Mega-Cap Startups Must Offer Secondaries to Retain Top Talent
“At some point the scale of the capital stack gets so big that secondary becomes to Sam's point, the only way that people can get the piece that they want. But it also becomes, you know, the gravity for the employee base becomes so strong that you have to start…”
Dave Morin: OpenAI has visibly stopped investing in SearchGPT
“And, you know, they've pretty visibly stopped investing in this search GPT thing.”
Jessica Lessin: OpenAI's Ultimate Revenue Bulk Will Come from Businesses
“The bulk of open AI's revenue, I believe will ultimately like come from businesses”
Dave Morin: NotebookLM could replace Google's Gemini UX within six months
“I mean, I think you might see in three, six months that the sort of Gemini core user experience is thrown out in favor of the notebook LM experience because it's just better for everyday consumers.”
Dave Morin: Unprofitable OpenAI and Anthropic will be forced to increase prices
“Like at the rate they're having to raise capital and at the unprofitability of their business models, they can only increase prices from here.”
Dave Morin: Free Apple on-device LLM APIs will trigger consumer app explosion
“And those APIs are not yet available to developers when they are. There's going to be a Cambrian explosion of consumer applications that happen because you can now use these things for free.”
Brit Morin: Apple and Google will win the consumer AI market
“I do buy that like anthropic or open AI might have a big play in the enterprise world, but for the consumer world of AI, those two have to be the winners.”
Sam Lessin: Big tech incumbents will capture all generative AI profits
“I mean, I obviously deeply agree with the fact that the incumbents are going to crush all of this. Right. And I think that's where all the money's going to be made.”
Dave Morin: Apple's Small LLMs Cannot Synthesize Full Personalized Health Data
“Like the point I was making about Apple making the small LLMs available via API is not like the small LLMs are not going to achieve what you're talking about.”
Sam Lessin: LLMs cannot generate meaningful health insights without long-term studies
“Well, I just think all the health stuff is interesting, because, like, the whole point of it is, like, we don't have long-term studies on any of this shit. The blood boys, the, like, supplements, the creatine, and so, like, what is the LLM going to tell you ma…”
Sam Lessin: Generative AI is merely an Ajax-level innovation
“I think OpenAI and, like, AI in general could be, like, an Ajax-level innovation, but that is nothing. That's not, like, a real unlock. That was, like, a minor unlock is my basic point. It helped a little bit. It didn't change the world.”
Dave Morin: Software engineering with LLMs is a fundamental change
“I do believe that the ability to do software engineering with LLMs is a fundamental change to the universe.”
Dave Morin: AI enabled him to build an app that previously cost $2M
“I was able to build an application that would have taken three to five people and probably a two million dollar seed round one year ago to build.”
Sam Lessin: Generative code will wash out low-code, middleware, and SaaS
“Does this fuck the whole low-code, no-code movement? Yes. Absolutely. Does it fuck SaaS? Yes. Because all of a sudden, you're not using Zapier to put this shit together. It doesn't matter. Like, there's a thousand ways, there's just completely irrelevant. So a…”
Brit Morin: AI tools will unlock millions of everyday software developers
“I think this unlocks so many new software developers who don't, who are just everyday people.”
Jessica Lessin: Apple decided not to build frontier LLMs to protect CapEx
“Apple appears to really not be in like the frontier model LLM game. They've made that decision. You know, I think a lot of that is also coming from investors, like Apple cares so much about its CapEx, and so on and so forth, like they clearly aren't trying to …”
Dave Morin: Cohere is the leader in on-premise enterprise AI models
“If you go into the fourth category, which like, I think cohere is basically the leader in is the on premise enterprise model, right?”
Jessica Lessin: Inflection and Character VCs were compensated via licensing fees
“The VCs invested in inflection. The VCs invested in character. The teams were acquihired and they got like a licensing fee to compensate, you know, for their money.”
Sam Lessin: A $500 million venture fund is the exact wrong size
“Cause you're too small to plow money into things and you're far too big to ever return multiples in the funds. Like five hundred million dollars is like exactly the wrong size of a fund.”
Brit Morin: LPs Use Barbell Strategy, Avoiding Mid-Sized VC Funds
“A lot of LPs won't even invest in that. It's like, they're so in the middle. Like a lot of LPs these days are going for the barbell strategy. They want the like a hundred million dollar and under funds or the billion dollar plus funds.”