Apr 26, 2024 · 1h 2m · more-or-less
#44: The $1B AI Girlfriend Market, the Tech Hedge Fund Fallout and Why VCs Can’t Quit AI · More or Less Podcast
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In this episode of More or Less, hosts Jessica Lessin, Sam Lessin, Brit Morin, and Dave Morin analyze landmark tech developments, including the TikTok divestment legislation, the FTC non-compete ban, and the polarization within AI venture capital. They also examine the collapse of mid-market growth funds, critique clumsy consumer AI features, and explore cultural phenomena ranging from AI companions to executive fitness trends.
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 99.2% of the talking time here. How this is scored →
The hosts as informed peer 5.8 Guest teaching 2.7 Guest disagreement 4.0 The hosts pushing back 4.1
speaking balance: gold is the hosts, purple is the guest (3 minute bins)
Sharpest disagreement ▶ 32:20 Sam's Zealot Rant Against AI Startup Funding
Sam forcefully rejects the premise that AI venture investing makes sense, declaring that zero dollars will accrue to startups and accusing prominent VCs of running a fee-collection scheme.
Hardest push from the hosts ▶ 40:52 Dave's Rejection of Meta's In-Feed AI SearchDave bluntly refuses the framing that Instagram's AI query bar is good product development, calling it an obstructive anti-user decision that gets in the way of search intent.
Biggest teaching moment ▶ 29:42 Jessica's Editorial Team Disproving Her AI Accuracy ClaimJessica openly admits to face-planting after her newsroom team thoroughly disproved her theory on hallucination guardrails by producing seven blatant AI errors on the spot.
The host holds their own ▶ 35:12 Jessica's Insider Reporting on Enterprise AI Cloud ArchitectureJessica displays first-hand journalistic expertise by reporting that leading AI app founders are deliberately avoiding Microsoft Azure because OpenAI consumes priority GPU allocation.
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 |
|---|---|---|---|---|---|---|
| Opening Theme and Title Sequence | 6 | 1 | 2 | 2 | Jessica establishes domain authority by breaking down the legislative pathway of the TikTok divestment bill, First Amendment legal hurdles, and previous Trump executive order precedents. The co-hosts engage in collaborative, informal banter with minimal conflict. | |
| The FTC's Non-Compete Ban and Human vs. Machine Regulation | 6 | 3 | 4 | 5 | Sam presents a provocative argument that the FTC should regulate machine learning models carrying proprietary data rather than human non-competes. Brit pushes back directly, pointing out that non-competes disproportionately protect human relationship-driven service businesses rather than software engineers. | |
| Speculating on Potential TikTok Buyers | 6 | 1 | 3 | 4 | When Brit raises rumors of Sam Altman acquiring TikTok, Dave and Jessica immediately reject the idea based on deal scale and mandatory Chinese regulatory approval. Sam offers cynical, satirical commentary about sales to foreign sovereign entities. | |
| Sam Lessin's $100K Documentary Venture: Saving Harvard | 4 | 1 | 4 | 5 | Sam pitches his plan to produce low-cost influence documentaries like 'Saving Harvard' for $100K. Dave and Brit express heavy skepticism, questioning the production costs, quality standards, and distribution channels. | |
| VCs as Media Creators and Reid Hoffman's AI Philosophy | 7 | 3 | 4 | 4 | Dave and Sam demonstrate strong financial knowledge exploring public pension outflows from hedge funds like Bridgewater and Ark Invest. They outline the structural polarization of asset management, where mega-scale market makers and small fundamental researchers survive while mid-sized funds collapse. | |
| Bilt Rewards, Forbes Billionaires, and the Petty Crime Conference | 4 | 2 | 4 | 3 | Sam ridicules founders who promote Forbes billionaire listicles as an operational red flag. Brit briefly confuses Bilt Technologies with Bilt Rewards before correcting the record, leading into nostalgic banter about their mock conference concept. | |
| Surviving the Dead Middle: The Series A Optional Playbook | 7 | 5 | 4 | 4 | Dave and Sam lay out tactical founder advice on building a Series A-optional business to bypass the venture freeze. Jessica demonstrates vulnerability by sharing how her editorial staff schooled her by producing seven instant examples disproving her claim that ChatGPT hallucinations had been solved. | |
| The Polarization of AI Venture Capital and Big Tech M&A | 6 | 3 | 6 | 4 | Sam aggressively rejects the bullish venture capital consensus on AI startups, asserting that no economic value will accrue to early-stage apps and that mega-fund VCs are simply gambling on management fees. Dave counters by highlighting Microsoft's aggressive deployment of smaller proprietary enterprise models. | |
| Enterprise AI Cloud Battles and On-Device Compute | 8 | 4 | 4 | 4 | Jessica reveals high-value reporting that top AI app founders are choosing AWS over Microsoft Azure because Microsoft starves third parties of compute to support OpenAI. Dave complements this by detailing Apple's release of OpenELM models for local on-device compute. | |
| Critiquing AI Feature Bloat and Rippling's Contrarian Approach | 6 | 2 | 4 | 5 | Dave strongly pans Meta and Instagram for cluttering their native search interface with generic AI prompts, calling it an anti-user decision driven by corporate search query quotas. The hosts contrast this with Rippling founder Parker Conrad's refusal to ship superficial AI features. | |
| Analyzing the Billion-Dollar AI Girlfriend and Boyfriend Markets | 6 | 4 | 5 | 3 | Sam rejects Brit's citation of a billion-dollar AI girlfriend market, arguing contrarily that AI boyfriends will generate substantially higher lifetime value because female users seek emotional continuity and conversational depth, whereas male products quickly commoditize into superficial imagery. | |
| Emotional Perception Test and Biological Threat Responses | 4 | 3 | 3 | 5 | Brit highlights an online emotional discernment test where she substantially outscored Dave, claiming women possess superior emotional perception. Dave pushes back, accusing Brit of overgeneralizing an unscientific test for self-serving validation. | |
| The Bodybuilding Obsession in Finance and Tech Leadership | 6 | 3 | 5 | 5 | Sam lambasts Taylor Swift's double album as an unedited, bloated misstep indicative of yes-men culture, predicting a cultural downturn. Dave and Jessica push back by explaining the album's therapeutic narrative arc for core fans and analyzing streaming data benchmarks against Drake and Bad Bunny. |
Statements from this episode (22)
Jessica Lessin: TikTok Will Sue the U.S. Over First Amendment
“So what's gonna happen after Biden signs this is ByteDance or TikTok is gonna sue to block it on the grounds that it's infringing on the First Amendment.”
Jessica Lessin: Walmart, Oracle, and Microsoft May Bid for TikTok
“We'll see Walmart and Oracle and maybe Microsoft and who knows, try to form potential consortiums to buy it or spin it off.”
Sam Lessin: Facebook Forced Me to Sign Non-Compete Over Venmo
“When I went and worked at Facebook on the way in, one senior executive reviewed all my investments and told me which ones I had to divest from. Interestingly, path was fine at the time, but Venmo was a big problem. And then, yeah, believe it or not, I had to s…”
Sam Lessin: ByteDance Will Sell TikTok to Saudi Buyers
“They're going to sell, you know, they're going to sell it to the Saudis.”
Dave Morin: Any TikTok Buyout Requires a Multi-Party Syndicate
“And the scale of it also, I mean, it's, it has to be a multi-party deal, like many private equity firms plus Saudi, I don't even know, like the scale of it is enormous.”
Jessica Lessin: Mubadala Will End Up Owning TikTok
“I think Mubadal is going to end up owning TikTok.”
Sam Lessin Plans a $100K Harvard Presidential Search Documentary
“So my first documentary, I'm thinking about like all of my strategies and things I want to do in life is I'm going to make one. I can't decide if it's called fixing Harvard or saving Harvard. It's going to be a Harvard presidential search and saving Harvard fo…”
Jessica Lessin: Reid Hoffman Is the Most Heavily Invested AI VC
“He's also the most invested in AI, which is saying a lot because everyone's invested in AI.”
Sam Lessin: Mid-Sized Hedge Funds Get Squeezed Out of the Market
“You can't be in the middle. You can't be a middle-sized fund. You get forced out because you're too big to do the interesting stuff and too small to be one of the prime broker market maker type people.”
Sam Lessin: Late-Stage Venture Capital Is a Terrible Asset Class
“It's the same thing with like late stage private capital. It's like, it's just a shitty asset class, right? Like, it's like, I understand why you want to be a hyper profitable, super Thingy AI companies with infinite pop side and tons of control of their margi…”
Sam Lessin: Retweeting Forbes Billionaire Headlines Signals Impending Doom
“Whenever you see someone retweeting a Forbes headline saying how I became a billionaire, you know there's gonna be a problem.”
Sam Lessin: Founders Must Skip Mid-Stage Funding With Profitability
“Take a few million bucks, go build a business that fucking works. You have to skip the middle with having a profitable business that works. So you never need the middle and then you come out the other side or you have a very profitable business.”
Jessica Lessin: ChatGPT Is Basically Useless Because It Is Delusional
“This is my whole thing that like chat GPT is basically useless because it's so delusional.”
Sam Lessin: AI Startups Will Yield Zero Value and Go Bankrupt
“And so if you're someone like me, who's in the camp of this is a great disruptive Business technology, and zero dollars will accrue to startups, and they're all going bankrupt. I am now a zealot for no fucking way, right?”
Sam Lessin: AI Capabilities Are Asymptoting Faster Than Admitted
“I'm an asymptote guy, and I think we're asymptoting faster than people want to admit in this generation of technology.”
Dave Morin: Users Will Prefer Free Local AI Models Over Cloud
“If you can accomplish 80% of What you want to accomplish using a local model that's free on, on, on the person's iPhone or whatever, you're going to do it because it's free and you're not going to, you know, use the cloud based model.”
Sam Lessin: Incumbents Will Dominate AI Features Via Existing Distribution
“It's nice to be 10% better at those prompts, but that's not what's going to dominate. It's just like whatever they choose to put in there is what's going to dominate, right? Like no one's going to like change, no one's going to not use LinkedIn because some up…”
Dave Morin: Meta AI's Instagram Search Integration Is a Terrible Decision
“When I saw this, like, Instagram thing happen, I'm like, this is the first Instagram product decision lately that just makes absolutely no sense to me. Like, as a user, I have no use for this. In fact, The box is in the way of search, right? Like, when I want …”
Sam Lessin: AI Bots Will Disrupt Glamour Influencers on Instagram
“I think this is a place where, like, if there's anything, anyone that should worry about disruption from AI, It is, like, very plasticky fake girls on Instagram, because, like, they can be beaten by bots, and the bots are already showing up.”
Sam Lessin: AI Boyfriends Will Be a Bigger Market Than Girlfriends
“I actually think AI boyfriends would be bigger than AI girlfriends. The difference is the AI girlfriend thing would just become a screen of boobs and totally uninteresting really quickly because it's all going to look the same.”