All-In PodcastAI Kills Everybody or Doomer Psyop? OpenAI’s Math Breakthrough, Nike’s $200B Collapse
EVERY SPOKEN WORD
90 min read · 18,467 words- 0:00 – 0:35
Bestie intros!
- DSDavid Sacks
The PSYOP canceled on us? Is that what happened?
- JCJason Calacanis
Yeah, the PSYOP canceled. He couldn't take the smoke.
- CPChamath Palihapitiya
He did not want to be cross-examined by David Sacks.
- JCJason Calacanis
[laughs]
- CPChamath Palihapitiya
I haven't used my legal degree in 25 years.
- DSDavid Sacks
Oh, man. I was up all night doing research on this.
- CPChamath Palihapitiya
[laughs]
- JCJason Calacanis
[laughs] We can still talk about it.
- DSDavid Sacks
I'm so ready. Yeah. You let your winners ride.
- JCJason Calacanis
Rain Man David Sacks.
- DSDavid Sacks
And instead, we open source it to the fans, and they've just gone crazy with it.
- CPChamath Palihapitiya
Love USIC.
- JCJason Calacanis
Queen of quinoa.
- 0:35 – 33:40
AI Doomsday: Valid concern or Doomer psyop?
- JCJason Calacanis
Sacks, we have to talk about Anthropic. A researcher just quit over AI fears that he thinks could kill us all. Jacob Coxon worked as a researcher at OpenAI, then Anthropic, over the past three years. Now, he only started at Anthropic six weeks before resigning. After quitting, he posted the following to X, quote, "The people building AI earnestly believe that it could kill us all by the end of the decade. This is not a marketing stunt," quote. Neither OpenAI or Anthropic, uh, ostensibly is acting responsibly. They're not acting responsibly, Sacks. Quote, "They are racing straight to self-improving super intelligence and gambling," ugh, gambling with our lives. This went insanely viral. I haven't seen a tweet go to 150 million views since Elon said he was gonna put the cocaine back in Coca-Cola, which I think was the number one tweet of all time.
- CPChamath Palihapitiya
But Jason, can you actually explain to me, how does somebody who doesn't have any followers or an account show up on a Monday and get 110 million views on a Tuesday? How does that algorithmically happen?
- JCJason Calacanis
That's a great question. We're gonna get into it. Evan Hubinger, who leads alignment science at Anthropic, responded to Jacob. Quote, "Jacob is correct here. We really do earnestly believe AI could kill all humans!" Exclamation point. "I personally think it is over 10% within the next decade. We do not yet have a plan to solve alignment." These two posts [laughs] had 200 million combined, and it immediately jumped, as I mentioned last week, these things are now jumping from X and the AI community to the nightly news in under 24 hours. Bernie Sanders, never the one to waste a crisis, said posts like this are the reason he's pro- proposing legislation to ban, B-A-N, ban super intelligence and pause AI development. Governor JB Pritzker replied to this post saying, "It's time to sound the alarm louder on reining in AI." Sacksy-poo, as our former czar of AI, do you share everyone's concern here that we're all going to die by 2030?
- DSDavid Sacks
No, I don't. And look, there's nothing new here. This is the same doomer histrionics that we've been hearing from this crowd for a long time. And, you know, the media's calling him a whistleblower, but what evidence has he brought forward that we didn't have? This is all just vibes from him. Show us the data. Show us the report. Show us the leaked information that the public didn't already have. Show us the facts. Show us the evidence. We don't have any of that. In fact, as Chamath was alluding to, this appears to be an op. How do we know that? Well, first of all, this is an account that had almost no activity, almost no followers, and no posts prior to this resignation tweet storm. If he did have prior posts, they were scrubbed. So this was a completely blank account, and somehow within a day it finds this huge audience. Elon has said it never happened before. And we also know who amplified it in the first 15 minutes. So there were basically three of these well-organized, well-funded doomer groups who amplified it. So Nathan Calvin, who's the general counsel at Encode.ai, they're the group that basically pushed for SB53 in California. They're pushing for all these state-level AI laws. Peter Will defer, who's head of policy at the AI Policy Network, which is pushing for, you know, all these federal regulations, having a federal department of AI. And then Daniel Kokotajlo, who's head of the AI Futures Project, who just happened to drop a Rogan episode at the same time in which he used the exact same phraseology about how AI's gonna kill us all. And all three of these groups are funded by Jaan Tallinn, who is one of the top few of these EA mega donor doomer types, who also happens to be a co-lead of the Anthropic Series A. So this is a tight-knit community that jumped on this tweet. So this was not some spontaneous act by an employee who said, "Oh, I'm just gonna post my resignation letter on Twitter." This was something that was orchestrated. And then just the, the final piece of evidence on this point is that someone looked at The Wall Street Journal story that covered the resignation letter, and somehow it was posted minutes before the tweet storm itself. So The Wall Street Journal was given-
- JCJason Calacanis
Was under embargo. That's what it means. The technical term is they were briefed under embargo, and they screwed up the publish times.
- DSDavid Sacks
Right. And this guy, Jacob Coxon, he reached out to you, JCal, said, "Hey, I wanna come on the pod."
- JCJason Calacanis
Yes.
- DSDavid Sacks
Did he not? And then he canceled this morning 'cause maybe he figured out it would be a tough interview. If he had come on the pod, the questions I'd wanna ask are, "Who connected you with The Wall Street Journal?" You know? This was a relatively low to mid-level employee who'd been there for, I've heard different estimates, six weeks to three months. Let's say three months. This is not something that'd be covered by The Wall Street Journal in this way. This is something that was teed up. He's clearly working with these doomer groups. They're going for maximum amplification. And again, he's being called a whistleblower, but what have you blown the whistle on? You know, where's the evidence? Where's the data? We'd love to see what you saw inside of Anthropic if somehow there's a problem there, but you won't tell us what that is. And in most whistleblower cases, you get the company pushing back. They say, "Well, no, it's not true," or, you know, they want to refute what he's saying. In this case, they're amplifying it themselves. You've got this-
- JCJason Calacanis
Well, and you would... A functional company, Sacks, would disavow. Wouldn't a functional company disavow this, Sacks, immediately?
- DSDavid Sacks
Here's the contradiction is he is a-
- CPChamath Palihapitiya
Well, no, it's very complicated
- DSDavid Sacks
... he's actually amplifying their message, and you saw that when his boss or the person who's running this safety team is, he's saying that, "Yeah, we all agree with you." And he then put it on this greater than 10% chance of extinction, which when you put a number on something that frankly is just vibes, now it takes the le- the message to a whole nother level.
- CPChamath Palihapitiya
Two questions for you, Sacks, and then I have a bunch of comments and statements. I mean, this thing is crazy. Question number one is just let's steel man the other side. What is the game theory on the psyop? How do you think it is supposed to go from here had it not been exposed? What do you think they thought would happen?
- DSDavid Sacks
Well, I think they know exactly what's gonna happen. I mean, they are going for maximum amplification. Uh, look, he- given that this, this guy was at the company for a maximum of three to four months, it's entirely possible to me that he joined knowing that he would put together this campaign and he-
- CPChamath Palihapitiya
Yeah, yeah, yeah. So what's the point of the campaign?
- JCJason Calacanis
So pre-meditated. So what was his goal, and is he a rogue agent?
- CPChamath Palihapitiya
What's the goal?
- DSDavid Sacks
Oh, it's to shape-
- JCJason Calacanis
Is he rogue or he's in coordination? That's I guess the other question
- DSDavid Sacks
... no, these groups are interested in shaping the public perception of AI. This is what they do. I mean-
- JCJason Calacanis
To what end?
- DSDavid Sacks
... these are groups... Well, they're creating a, a very negative perception of AI to further their case for AI regulation, and the end goal here is to create a federal department of AI. They want an AI regulator. Some of them also want a pause. Some of them also want a ban on super intelligence. Well, that's what Bernie Sanders' bill puts forward. But all of them want a new federal regulator for AI, and that is what Dario himself has called for. Again, is a-
- CPChamath Palihapitiya
That they can control, basically
- DSDavid Sacks
... is a FDAI, which invariably they will control, and they will basically then be able to push their preferred frameworks for regulation through this new regulatory body.
- CPChamath Palihapitiya
Okay. I have another question. So now you have this very complicated moment where you have internal employees validating an employee that just left making claims, let's call them whistleblower claims, that create, at a minimum, product liability issues, but at a maximum may create false representation issues. You have an active S1 process underway, and so how are they to handle that? Like, I'll give you a couple of historical examples. You guys remember when Google was going public? I mean, Friedberg, you probably lived it, but there was an interview that I think Sergey or Larry or both of them did with Playboy, but that was well before the IPO window, and then they published it in the middle of their quiet period. And there was all kinds of noise about how that could have derailed their IPO, that they would've had to refile. In a separate example, when Slack was going public, I was on the board, and I was on TV with CNBC, and we were talking about Tesla and SpaceX, and I made a couple of comments about Slack, positive, but not saying anything that was crazy, just about the network effects of Slack.
- JCJason Calacanis
It wasn't super effusive. I remember it now.
- CPChamath Palihapitiya
And but that almost stopped our IPO, and we had to go and print it out, and we had to put it back into the S1, and we had to disclaim these things. This seems so beyond that because this is so beyond the pale of what these folks are claiming. What does it do to their IPO process? Now, Sacks, you jokingly said, "Stop the IPO," but what is the SEC supposed to do? What are the, what are the lawyers supposed to do?
- DSDavid Sacks
Well, let me, let me explain my tweet actually.
- JCJason Calacanis
Wait, are you joking or are you serious in that tweet?
- DSDavid Sacks
Well, I was, I was tongue in cheek in that tweet.
- 33:40 – 58:45
Steelmanning AI Doomsday scenarios and the impact on Anthropic's IPO
- CPChamath Palihapitiya
Okay, so my game... Nick, do you have any music? [upbeat music]
- DFDavid Friedberg
Oh, it's like a End Humanity: How We All Die. [laughs]
- CPChamath Palihapitiya
Okay, guys, this game is called How Do We All Die? In this game-
- DFDavid Friedberg
Nice
- CPChamath Palihapitiya
... we will go around and steelman the concept that there's a 10% chance that we all die from AI. What is your most likely path to human extinction, J Cal, from AI? Go ahead. You're first.
- DFDavid Friedberg
Okay, I'll take human extinction for 800.
- DSDavid Sacks
Yeah. [laughs]
- DFDavid Friedberg
You always wanted to be the, the host of Jeopardy!. That would be a great moment for all of us. Um, I'm gonna go with Skynet and Cyberdyne Systems. This was the... If, if people forget, but at the end of Terminator 2, they got the arm and one of the chipsets. And then Cyberdyne Systems built for NORAD, uh, which controls weapons and decisions to fire off nuclear bombs, and there was Miles Dyson. He was the lead researcher. He's the Jacob, he's the, uh, Dario in Anthropic, and that engineer studied the parts that came back through time. In this case, this would be studying the LLM, and then he reverse engineered it, and then he empowered NORAD to be, uh, to build a defense system powered by AI. And when it became sentient, it then tricked the Russians and started the nuclear holocaust. That's the number one way we all die, is that they somehow use Claude inside the military to do autonomous weapons. It's the only way that this actually happens, in my mind.
- CPChamath Palihapitiya
Chamath, do you have a how do we all die theory? How do we all die for 800? The best example I could get is that there are some internet-connected bioreactors with internet-connected robots-
- DFDavid Friedberg
Okay
- CPChamath Palihapitiya
... and access to all of the precursor materials, and that the AI hacks the robots to take the precursors and use the bioreactor that it then controls, again, over the internet, to create some kind of virulent airborne mechanism that spreads rapidly and violently all around the world. So it has to have an, an enormously long half-life, gets into the jet stream, can kind of go all over the world, and that when we inhale it, we die.
- DFDavid Friedberg
Mm.
- CPChamath Palihapitiya
That is the... Now, again, that would need all of these other things.
- DFDavid Friedberg
So contagion by robots and a sentient AI.
- CPChamath Palihapitiya
Again, you'd also have to have bioreactors and, and precursors, which is-
- DFDavid Friedberg
Yes. It's a couple of step
- JCJason Calacanis
What do you got, Sacks?
- DSDavid Sacks
Well, look, the problem with these types of... F- first of all, I think it's kind of a dumb thought experiment to make arguments that you don't believe in. But look, the, the problem with, like, the cyber example or the bio example, it's like, yeah, is AI going to allow for misuse in new kinds of ways? Will there be new AI-powered cyber attacks? Could there be new viruses created using AI to, you know, create novel sequences? Yes, those are risks, but at the same time you can use the same technology to create antidotes and prevention and cures and all that kind of thing. And so it's like a lot of things where, yeah, there are tools that can be used by bad actors, but there are a lot more good actors than bad actors out there, and it's illegal to use them for bad actions. And, you know, it was possible to, to break into systems and hack before AI, and a lot of people who could do it didn't do it because they didn't want to go to jail. And so again, with the combination of the tools being used for good and then the legal penalties for doing bad, these are, I think, things that we can control.
- DFDavid Friedberg
Part of the argument that I wanted to make in going through how does everyone die is it is very hard to have a clean scenario given the human-in-the-loop dynamic and the air gap dynamic. Explain both of those, please.
- JCJason Calacanis
Well, hold on. What's your best answer, Friedberg? What's your best answer? What's the best thing you can come up with?
- DFDavid Friedberg
Yeah. How do we all die? I think shutting down financial networks, but then there's hard backups. Like, there's, there's a solve for this because a lot of the financial institutions already have, uh, nuclear response scenarios where they, they make physical hard copies of everyone's assets and records. They sit in different locations. There's a lot of systems of redundancy that are air-gapped, that are designed to not be connected and not hackable, and that have a human-in-the-loop process where there's an actual human process involved. So I think a lot of our critical systems are importantly set up in such a way that they have human-built redundancy for the notion of, uh, cyber defense, for the notion of hacking effects, nuclear, all these sorts of things happening. Because my biggest thing is, like, if everyone lost all of their digital assets, maybe that's a world that falls into chaos and people start to attack each other and whatnot. But I think it's very important to take note, as I've thought about this a lot, there's so much that's human in the loop that is also what makes AI so hard today to be successful from a productivity perspective. Like, we all experience it. AI can do these amazing things, but if you need a human to do something as part of the process, AI doesn't really do that much for you. Let's say you want to get a toiletry kit brought up to your room at a hotel. You tell your assistant on your phone, "Get me a toiletry kit brought up," and the AI figures out how to connect to the front desk and call the guy and tell him, and it's all digital, it's all automated. The AI does all these amazing things that it couldn't do a few years ago, but you still need the guy to bring the toiletry kit up from downstairs.
- JCJason Calacanis
Well, did it work? Did you get the intimacy kit or not?
- DFDavid Friedberg
Well, this is the point. This is, this is the hard-
- JCJason Calacanis
[laughs]
- DFDavid Friedberg
This is the longest pole in the tent. It's like getting the guy to actually come upstairs and bring you the freaking toiletry kit. And there's a lot of examples-
- JCJason Calacanis
The fucking-
- DFDavid Friedberg
Yeah
- JCJason Calacanis
... autocomplete doesn't work yet, guys
- DSDavid Sacks
I know, exactly.
- JCJason Calacanis
I mean, come on.
- 58:45 – 1:19:55
OpenAI says it cracked a 200 year old math problem, but did it front-run users with their own data?
- CPChamath Palihapitiya
OpenAI says it solved a 200 year old math problem. But claims now are that, uh, somebody may have front-run an actual scientist's work that was being done on OpenAI. So the Navier-Stokes equation [chuckles] written in the 1800s describes how fluids move. Every aircraft, pipe, and weather model on Earth is built on them, and they apparently... Give us the history of this here, Friedberg. A lot of people have been working-
- DFDavid Friedberg
Look, I'm not the guy. These are methods for modeling fluid dynamics, partial differential equations. These are mathematical approximations of continuous things in the physical world, and OpenAI's solution, uh, that they published, they said that they used a reported 130 billion output tokens to do the work between 10,000 agents that were spun up to work with one another, and I just did the math on this, like the human equivalent hours is kind of the real estimate of what this work was that was done by these agents. Because it's not like the AI, and I think this is so important for people to understand, it's not like the AI had some stroke of genius, some magical insight that no human brain could comprehend. What happened was the AI just did a bunch of brute force work to come up with this answer, and the work was done across many, many computers. 10,000 agents just means 10,000 applications running on a computer, talking back and forth to one another, sharing information, sharing analysis. And the equivalent, if you were to think about human work years, is somewhere between 50 and 500,000 years of human work, with humans typing at 40 words a minute, you know, having mathematical problems, solving them with calculators, doing this sort of stuff back and forth. And you could probably reduce that down by calling it an order of magnitude, but it's still in the order of tens of thousands of years of human knowledge labor. And I think that that's really what this indicates about AI. AI is a tool of leverage for humans. AI is not some magical genius super God that sits above us that understands things we don't understand. Every piece of the OpenAI message set that went back and forth between these agents is documented, can be read by people, can be understood by people, and we can see the work that the agents did over the equivalent of tens of thousands of human years of time to get to the solution that it got to. And so for me, the solution that was described here is more of an insight into what AI is rather than what AI isn't. AI isn't some mathematical God. AI is an engine that gives humans extraordinary leverage. And when you think about the application of this particular set of problems and what else we might be able to do with sim- things that are similar, is instead of spending years trying to design a new aircraft wing, a new aircraft wing can now be brute force designed on a computer in a matter of seconds or minutes. A new engine design, a new energy system design. AI is a tool of leverage that takes tens of thousands of years of work and reduces it down to minutes or seconds. And so just like any other technology before it, I think it indicates that this gives humans leverage. It seems magical at first, it seems unbelievable at first, but when you dig into what actually took place, what's really going on is just really intelligent systems designed to solve problems using human-known techniques. So I just wanna kinda make my summary point on this whole thing. You guys are welcome to talk about partial differential e- equations and why they're so hard, but that, that for me was my biggest takeaway on this whole thing.
- JCJason Calacanis
Yeah, the bigger issue here, Chamath-
- CPChamath Palihapitiya
Your takeaway is that this was a very clever systems approach to brute force problem-solving.
- DFDavid Friedberg
Yeah.
- JCJason Calacanis
The, the other issue-
- CPChamath Palihapitiya
I agree with that
- JCJason Calacanis
... here, Chamath, is-
- CPChamath Palihapitiya
Also, Jason, the auto-complete still doesn't work [laughs] .
- JCJason Calacanis
Yes [laughs] . We solved one of the seven hardest math problems in the world, and you still can't get your intimacy kit from the front desk.
- CPChamath Palihapitiya
And depending on the model, it still can't spell strawberry right [laughs] .
- JCJason Calacanis
Or count to 100.
- DFDavid Friedberg
How many Rs in strawberry?
- JCJason Calacanis
Chamath, the other issue here-
- CPChamath Palihapitiya
Oh, my God
- JCJason Calacanis
... which we've talked about here in terms of AI sovereignty, using open source in the enterprise, not trusting the frontier models with your data, when OpenAI came out with their solution, there was a claim that the original scientist working on this may have trained the LLM from OpenAI to make it easier for them to solve, and OpenAI posted the following statement: "While unlikely, we cannot rule out that de-identified data derived from their usage," they being the mathematicians, "of our products helped improve our models." So maybe you could speak on AI sovereignty here. Should any scientist or law firm or, you know, person working in biotech making new potato seeds, should they trust any of these LLMs with their proprietary knowledge for fear of having it cribbed into a core LLM?
- CPChamath Palihapitiya
If you have incredibly sensitive proprietary data, you have to make a very difficult decision because the reality is, is that something is leaking, that there's remnant memory of how these solutions were solved that sits within these models even after the fact. There's a concept inside of these models called zero data retention, ZDR. It's a best efforts basis. It's a commercially best efforts basis at that. They can't guarantee it. You know, simple example, you could say, "Do not retain the decision-making process of this protein design." Okay. And it can kind of do that, but then if anybody that's using it clicks the Like button inside of the chat window, that's not r- necessarily guaranteed. So there's all these vectors where this data leaks into the broad corpus and understanding that these models have. So if you believe that the information that you have is critically important, you cannot use these services the way that they're currently offered by most people. What you need to do is you need to stand up your own sovereign solution. What does that mean? That means you need to go to a vendor that you trust, could be AWS, in terms of the neo-scalers, could be Nebius, and what they will do is they'll stand up your own hardware, and then you'll stand up your own models, and then they'll provision those models to you, and that's how you should probably be consuming it.
- JCJason Calacanis
Hmm.
- CPChamath Palihapitiya
And if you don't do that, you are creating risk. And look, let's be clear. Will a handful of CIOs get very publicly flogged and fired in the next year because they accidentally didn't understand this and just did an API deal 'cause they wanted to feel popular and leaked data into these models? Guaranteed.
- JCJason Calacanis
Why will people get fired, Chamath? What, what's gonna happen?
- CPChamath Palihapitiya
The thing that's happening right now is that a lot of this AI understanding and awareness is bubbled up through the audit committees and the risk committees of public boards. Who are those? Those are a handful of directors who are responsible for understanding the IT posture, the security posture of their business, and then they disclose that back up to the board, and then that understanding and awareness i- is what gets signed off and then submitted back to the SEC in these filings. They also have these consultants that help them, folks like Ernst & Young, Deloitte, and others. Increasingly, what we are all learning is that ZDR is not an effective solution, and there's a ton of leakage. And so what's happening now, Jason, is that that information and that awareness is bubbling up through the risk and audit committees of these boards. It's now going to the broader boards, and now CEOs understand that, hold on a second, my information could leak. So now they turn to their CIO and say- Okay, whatever you thought was happening, we now clearly know that it's not. What is your answer? And it's when that happens or when all of a sudden they'll have to disclose some critical IP was leaked into a model or that they don't know whether it was or was not, and all of a sudden something similar appears on the other side, that's when shareholders will be really upset because they'll say, "Guys, when OpenAI even tells you that they can't guarantee it and you have closed your eyes and assumed that your information isn't leaking, what are we to do?" And if that decays and erodes my share value that I purchased from you assuming you were gonna have your hand on the switch, that's where folks get fired and-
- JCJason Calacanis
Yeah
- CPChamath Palihapitiya
... you know-
- JCJason Calacanis
This is gonna be-
- CPChamath Palihapitiya
... shareholder lawsuits, and it's gonna be a mess.
- JCJason Calacanis
What does it mean for frontier models in terms of this trust, leakage, et cetera? Another reason to, I guess, embrace open source in the enterprise and individuals who are doing importune work.
- CPChamath Palihapitiya
By the way, so it doesn't have to be open source, it just has to be-
- JCJason Calacanis
On-prem
- CPChamath Palihapitiya
... your own entire... Well, it doesn't even have to be on-prem. It's effectively like your own VPC. You must go straight to the bare metal on your own terms. You need to control everything. You can work with folks like Amazon or Nebius or Fireworks. You can have open source solutions. You could even probably have Claude allow you to host a version of Claude in your VPC. But if you don't go through these hoops-
- JCJason Calacanis
Mm
- 1:19:55 – 1:35:53
Nike removed from S&P 100 after stock tanks 80%: What went wrong?
- JCJason Calacanis
All right, Nike, the 60-year-old iconic American brand, Just Do It, just got booted out of the S&P 100. They had been in the stock index, Sacks, for 18 straight years, being replaced by... Hey, shout out to our friend Nikesh, Palo Alto Networks.
- DSDavid Sacks
Nikesh.
- JCJason Calacanis
Congratulations to, uh, Phil Hamueth and Nikesh. Little history here.
- DSDavid Sacks
[laughs]
- JCJason Calacanis
They went public in 1980 with 50% share of US athletic shoe market. Dominant player, the Coca-Cola of sneakers. Uh, and they changed things, obviously, forever with Air Jordans in '85. They did the iconic Just Do It campaign in 1988. Peak market cap in 2021 was $264 billion. Peak revenue, uh, $51 billion in 2024. Since then, revenue's dropped a bit, 10%. In 2020, John Donahoe became CEO, pushed an aggressive direct-to-consumer strategy, basically alienating all the retail partners who had helped build Nike, and willingly removed those sneakers from the stores. That made brands like HOKA and On Running, uh, that every VC is obligated to wear the white ones to any speaking gigs they have. China sales down 30%, eight straight quarters of decline, losing share specifically to Chinese brands Anta and Li-Ning. Uh, if you're Chinese, you probably know those. Nike's marketing also went, uh, and this might feed some people's narratives, super woke, and they started backing political movements and putting robust people, Sacks, on billboards. I didn't get asked, uh, but, uh, this kinda killed the entire brand. Stock down 80% from its peak. Sacks, $200 billion eviscerated. What's your take here? I don't know if the audience can guess.
- DSDavid Sacks
I mean, this is the millionth example of go woke, go broke. You know, Nike was a brand that stood for great athletes, for amazing performance, for victory. I mean, isn't Nike the goddess of victory?
- JCJason Calacanis
Yeah.
- DSDavid Sacks
And they built their brand on GOATs like Michael Jordan, you know, and, and great athletes like that in many different sectors. Men and women of, you know, all different races. There w- wasn't a need to, like, do all this woke stuff, where now all of a sudden they're showing people you don't know. I mean, making w-
- JCJason Calacanis
They generally had low-percentage body fat prior to the woke era.
- DSDavid Sacks
Well, but it's not, it's not even about that. It's just like this person isn't even an athlete. Like, who is this person, and what is the message? Like, own the floor? It used to be Just Do It, you know? And then they got Dylan Mulvaney in an ad. You know, like the whole trans thing.
- JCJason Calacanis
They did?
- DSDavid Sacks
Yeah, this is like the Bud Light-
- JCJason Calacanis
Oh
- DSDavid Sacks
... case. So you had the woke stuff. Then you have the other piece of it, which is this, like, consulting approach where new CEO comes in. And we know John Donahoe, nice guy. You know, central casting. He looks like a CEO. But it's, like, a lot of change for change's sake it seems like, where he comes in, and direct-to-consumer is the new hotness, so they blow up all their retail operations, all their retail relationships. They had all these stores that had shelf space for Nike, and now that goes to competitors, who then took a huge amount of market share. And then the other thing I think they did is they did a reorg where they used to have departments in the company that were based on sports, so there's, like, a basketball division, and football, and tennis-
- JCJason Calacanis
Swimming
- DSDavid Sacks
... and so on.
- JCJason Calacanis
Everything.
- DSDavid Sacks
Swimming. And they, like, reorg that to be, I think, men, women's, and kids. So, like, why would you do that? I just-
- JCJason Calacanis
Why break what's working?
- DSDavid Sacks
I don't get it. It's-
- JCJason Calacanis
You're surging-
- DSDavid Sacks
Yeah, it's like-
- JCJason Calacanis
And yeah. Going direct... They, they had a very clear model here, Chamath, clicks and bricks, right? Like, you could go to a brick-and-mortar store, have a great experience trying these shoes on, running around the store, working with people who help runners pick the right shoes. And it's nice to be able to buy direct. I have to say, the Nike app's a delightful app, but why would they kill the retail channel of all things, uh, and piss off those folks who were their big advocates?
- DSDavid Sacks
If I've learned anything in almost 30 years of business, you have to have a very clear North Star and stick to it.
- JCJason Calacanis
Hmm.
- DSDavid Sacks
And at least when I was growing up, Nike's North Star was very clear to me, which was mastery and excellence embodied through athletics. That was it. I would see Michael Jordan, and I saw mastery and excellence. I would see Tiger Woods, mastery and excellence. I would see Serena Williams, mastery and excellence. Pete Sampras. You name it, and it was mastery and excellence. And somewhere along the way, mastery and excellence became, um, too traditional looking, and so they, they went away from things that were just nothing to be associated with mastery or excellence. I don't aspire to be a fat person.
- JCJason Calacanis
[laughs]
- DSDavid Sacks
Never have, never will.
- JCJason Calacanis
Yeah.
- DSDavid Sacks
I aspire to be Michael Jordan. Always have, always will
Episode duration: 1:35:56
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