Why Anthropic's best model is locked up despite a $30B ramp

1. 0:00 – 4:22

   Bestie intros: Brad Gerstner joins the show!

   1. JCJason Calacanis0:00

      How many PRs you think are gonna get pushed to the core structural internet in 100 days? What's the over under number? 'Cause I'll give you a number.

   2. BGBrad Gerstner0:06

      You're gonna say zero. My, my answer to that is-

   3. JCJason Calacanis0:09

      No, no, no. I'll, I'll say, like, 10,000, but it's gonna be a meaningless thing.

   4. BGBrad Gerstner0:12

      But if it prevents your browser history from being released to everybody in the world-

   5. JCJason Calacanis0:15

      Mm

   6. BGBrad Gerstner0:15

      ... Chamath, that may be something that you're willing to, you know, let 100 days pass on.

   7. JCJason Calacanis0:19

      I think you got Chamath's attention when you said browser history.

   8. SPSpeaker0:21

      What about the dick pics?

   9. JCJason Calacanis0:23

      [laughs]

   10. BGBrad Gerstner0:24

       [laughs]

   11. SPSpeaker0:25

       [laughs]

   12. JCJason Calacanis0:25

       As Chamath is... He's gonna release them himself. [upbeat music]

   13. BGBrad Gerstner0:30

       You let your winners ride.

   14. JCJason Calacanis0:33

       Rain Man David Sacks.

   15. BGBrad Gerstner0:37

       And I said-

   16. SPSpeaker0:38

       We open sourced it to the fans, and they've just gone crazy with it.

   17. BGBrad Gerstner0:41

       W.S. I-

   18. JCJason Calacanis0:42

       Queen of Ken Rob. All right, everybody, welcome back to the number one podcast in the world. David Friedberg is out this week, but in his place, the one, the only, our fifth bestie, Brad Gerstner.

   19. BGBrad Gerstner0:56

       I mean, what, don't you ever brother puts a little namaste in your payday anymore?

   20. JCJason Calacanis1:00

       Absolutely.

   21. BGBrad Gerstner1:01

       You used to be Sabby.

   22. JCJason Calacanis1:02

       You know what? I'll bring, I'm gonna bring back the intros.

   23. BGBrad Gerstner1:02

       You used to be the greatest moderator, but now it's just, it's kind of lame.

   24. JCJason Calacanis1:06

       No, I'll do the intros. You know what? These guys beat me up. They beat me up, and they just beat the, the joy out of me doing this program.

   25. BGBrad Gerstner1:12

       [laughs]

   26. JCJason Calacanis1:12

       [laughs]

   27. SPSpeaker1:13

       It's because you're a Ro Khanna apologist now.

   28. JCJason Calacanis1:15

       No. I-

   29. SPSpeaker1:16

       [laughs]

   30. JCJason Calacanis1:17

       We- we'll get into it, okay? Save it for the [beep] show. [laughs] I'm no Khanna apologist. Just 'cause I said, like, "Hey, they've stopped retard maxing, and they've started doing, like, some logical things"? Uh, yeah, okay. Here we go.
2. 4:22 – 24:07

   Anthropic blocks Mythos release for security concerns: major threat or marketing stunt?

   1. JCJason Calacanis4:22

      Anthropic is withholding its newest model, Mythos. I'm using the Greek, uh, pronunciation.

   2. SPSpeaker4:27

      [laughs]

   3. JCJason Calacanis4:28

      Its newest model, Mythos, uh, saying it is far too dangerous for any of us to have access to it. According to the company, the model autonomously found thousands of vulnerabilities, including bugs in every major operating system and web browser. This, uh, little study they did included 20-year-old exploits that had been missed by security audits for decades. Uh, some examples, they found a 27-year-old vulnerability in OpenBSD used in firewalls and critical infrastructure. They found a 16-year-old bug in FFmpeg. That was missed by automated tools, uh, after five million scans. The Linux kernel, all kinds of, uh, bugs they found. They released a hype video hyping up why they were not gonna share this model. Here's Dario. Come on the program anytime, brother.

   4. BGBrad Gerstner5:16

      But as a side effect of being good at code, it's also good at cyber.

   5. SPSpeaker5:19

      The model that we're experimenting with is, by and large, as good as a professional human at identifying bugs. It's good for us because we can find more vulnerabilities sooner, and we can fix them.

   6. SPSpeaker5:33

      It has the ability to chain together vulnerabilities. So what this means is you find two vulnerabilities, either of which doesn't really get you very much independently, but this model is able to create exploits out of three, four, sometimes five vulnerabilities that in sequence give you some kind of very sophisticated end outcome.

   7. JCJason Calacanis5:50

      All right, Brad. Uh, by the way, that set they're using there, that's the same room those guys play Dungeons & Dragons in every Sunday. Brad, you're... [laughs] 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

   8. BGBrad Gerstner6:16

      I, I mean, but I, I, I actually think they deserve a ton of credit here, and, and let me walk you through why, right? They, uh, 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. So, 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 what'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, forty 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 vu-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 would call AGI models. These are models with massive step function improvements in intelligence, um, and they're just too smart to be released immediately. You know, and by the way, there was nothing that said that, uh, every time you, you, you finish a model, you gotta, um, immediately release it GA. So they set up this idea of sandboxing, building defensive alliances, you know, in order to move away from that regime. I sh- I think it shows, and Sacks and I have talked about this a lot, so I'm interested to hear what he thinks. It shows you can trust the industry and market forces in coordination with the government. They were talking to the government about this, but they're not relying on some top-down regulation in order to do this. They laid out a blueprint that seems to me very pragmatic, that w- now that we're at this threshold, we're gonna sandbox these things. I think that OpenAI will end up doing the same thing. I think Google will end up doing the same thing. It's an aggressive way to keep the ra-- uh, you know, the pressure on and, and win the race at AI wh- wh-while making the trade-offs to protect safety. So, you know, I think you're always gonna have to make these trade-offs. I think in this case, it was a great move by Dario and team, and I think they deserve a lot of credit.

   9. JCJason Calacanis8:46

      Sacks, when you look at this, we had Emil Michael on the program a couple weeks ago. It might have been four or five weeks ago, and we had a very thoughtful discussion about, hey, if the government is gonna have these tools, you know, Anthropic wants to withhold them and, you know, what, what is the proper relationship there? You have to think that the government, and I know you don't speak for all parts of the government, if you were just gonna run through the game theory, they must have gone to the government and said, "Listen, this thing is so powerful, it can put together two or three hacks, create a novel attack vector, and this is incredibly dangerous." What if China has it? And if this thing is as powerful as Dario says it is, then this is an offensive weapon as well for us to take out, let's just pick, you know, a, a, a, a pressing issue, the North Korea's ballistic missile program. This is equivalent, the way it's being described, as the Manhattan Project perhaps. So what are the chances, two-part question for you, Sacks, that China already has this and is using it? And do you think Dario is doing the right thing by regulating themselves?

   10. DSDavid Sacks9:51

       I think Anthropic has proven that it's very good at two things. One is product releases. The second is scaring people. And we've seen a pattern in their previous releases of at the same time they roll out a new model or new model card, something like that, they also roll out some study showing really the worst possible implication of where the technology could lead. We saw this last year, about a year ago. They rolled out this blackmail study where supposedly the new m- model could blackmail users. There's been a whole bunch of these things. Actually, I went back to Grok and I just asked, "Hey, give me examples where Anthropic has basically-

   11. JCJason Calacanis10:31

       [laughs] Look at this, look at this Grok

   12. DSDavid Sacks10:32

       ... used scare tactics."

   13. JCJason Calacanis10:33

       [laughs]

   14. DSDavid Sacks10:33

       And it's, it's a pattern, okay? It's a pattern.

   15. JCJason Calacanis10:36

       Okay.

   16. DSDavid Sacks10:37

       These guys, I'm not saying it's not sincere, but they have a proven pattern of using fear as a way to market their new products. And if you think back to, again, my favorite example is this blackmail study where they prompted the model over two hundred times to get the result they wanted, and that result was, was clearly reverse engineered, and it got them the headlines they wanted. And I would say the proof that it's reverse engineered is we're now a year later, there's a bunch of open source models out there that have the same level of capability that that Anthropic model had, and have you seen any examples of blackmail in the wild? I don't think so. So in other words, if that study were true in the sense of being a likely outcome of that model, I think you would see examples in the wild of that behavior-

   17. JCJason Calacanis11:28

       Okay

   18. DSDavid Sacks11:28

       ... and we haven't seen any of that in the past year. Now, let's talk about this specific example with cyber hacking.

   19. JCJason Calacanis11:34

       Yeah.

   20. DSDavid Sacks11:34

       I actually think that this one is more on the legitimate side. I mean, look, the, the reason why I bring this up is anytime Anthropic is scaring people, you have to ask, is this a tactic? Is this part of their Chicken Little routine, or is it real? You know, are they crying wolf or not? I actually would give them credit in this case and say this is more on the, the real side. It just makes sense, right? So that as the coding models become more and more capable, they're more capable of finding bugs. That means they're more capable of finding vulnerabilities, and like one of their engineers said, that means they're more capable of stringing together multiple vulnerabilities and creating an exploit. And so I do think that over, say, the next six months, we're gonna have this, call it one-time periodOf catching up where AI-driven cyber is gonna be able to detect a whole range of, of bugs that maybe have been dormant over the past twenty years across a wide range of systems. And so I do think that there is real risk here.

   21. JCJason Calacanis12:31

       Mm.

   22. DSDavid Sacks12:32

       And I do think therefore, that having this pre-release period makes a lot of sense, where they're giving the capability to all these software companies that have existing code bases to use the tool to detect the vulnerabilities themselves so they can patch them before these capabilities are widely available. And by the way, it won't just be Anthropic that makes these capabilities available. We know that, like, let's say the Chinese open source models like Kimi K2, it's about six months behind. So we have a window here of maybe six months where we're still in this pre-release period where I think companies that have large code bases can get advanced access to this model. And, uh, I guess OpenAI says it's gonna release a similar thing in the next few weeks. I do think that every company or IT department or CISO that is managing code bases should take this seriously and use the next few months to detect any, again, like dormant bugs or vulnerabilities and, and roll out patches. If everybody does their job and reacts the right way, then I do not think it will be the doomsday scenario that Anthropic is sort of portraying. But it's one of these things where the fear might end up being a good thing in order to drive the-

   23. JCJason Calacanis13:47

       To wake people up, yeah

   24. DSDavid Sacks13:48

       ... to, in order to drive the correct behavior. So-

   25. JCJason Calacanis13:51

       Sure

   26. DSDavid Sacks13:51

       ... I ultimately think this is gonna work out fine, but you do need everyone to kinda pay attention, use the capabilities, fix the bugs. Then we're gonna get into a big arms race between AI being used for cyber offense and AI being used for cyber defense, but it'll be a more normal sort of, of period.

   27. JCJason Calacanis14:09

       Chamath, we have, uh, Dario and, uh, you know, a number of the participants here taking this super seriously. They're making a big statement. Sacks' very nuanced, uh, I, I think, take there. What's your take on how do these companies have it both ways? "Hey, this i- shouldn't be regulated. This should be regulated." If this is in fact a cataclysmic, "Oh my God, they're gonna hack everything. What if the Chinese have this right now?" That would speak to more government, either coordination, regulation, or some kinda relationship between the CIA, the FBI, for domestic stuff, and these companies, because there-- it is a non-zero chance that the Chinese have an equal capability here. We're assuming they're behind, but who knows what they're doing behind closed doors. So what's your take on this? Is it, uh, the boy who cried wolf, or is this the real deal now?

   28. SPSpeaker15:00

       I think it's mostly theater.

   29. JCJason Calacanis15:03

       Okay.

   30. SPSpeaker15:04

       In February of 2019, when Dario was still at OpenAI, they did the same thing with GPT-2. That was a 1.5 billion parameter model, which sounds like a total fart in the wind in 2026. But at that time, this 1.5 billion parameter model was supposed to be the end of days, and it was supposed to unleash this torrent of spam and misinformation, and that was the big bugaboo at the time. And so what happened? They went through this methodical rollout over six or nine months. They started releasing the smaller parameter models, and then they scaled up to the big 1.5 billion parameter model, and at the end of it, it was a huge nothing burger. If you actually think that Mythos is capable of doing what it says it can do, two things are true. One is a very sophisticated hacker can probably do those things right now with Opus. And two, if these exploits are this easy to find, whether you use Opus or whether you use Mythos, the reality is you'd have to shut down the internet for about five years to patch them all. So when you see like a large multi-trillion dollar GSIB bank, it's a bit of theater. Why? What do you think they can actually accomplish in two months? Do you actually think that if there's these vulnerabilities, it's all gonna get fixed? Let's give them six months. Let's give them nine months. But the reality is that capitalism moves forward, the funding needs moves forward, and the need for these guys to build adoption moves forward, and that's going to supersede what this is. So I do think that Sacks is right, that they have figured out a very clever go-to-market muscle here and a go-to-market motion that activates hyper attention and hyper usage, and so I give them tremendous credit, and I'll maintain what I've maintained before. Anthropic is shooting the lights out right now. This is like Steph Curry going bananas. From every- everywhere on the court, these guys are hugging threes.
3. 24:07 – 42:20

   Are OpenAI and Anthropic trying to kill OpenClaw? Does Anthropic already have market dominance in AI coding?

   1. DSDavid Sacks24:07

      of Anthropic. There was a really interesting story or tweet, I guess you could say, by the founder of OpenClaw that-

   2. JCJason Calacanis24:14

      Peter

   3. DSDavid Sacks24:14

      ... Peter, yeah. What's his name? Peter Stein-

   4. JCJason Calacanis24:16

      Steinberger

   5. DSDavid Sacks24:17

      ... Steinberger?

   6. SPSpeaker24:18

      Steinberger.

   7. JCJason Calacanis24:18

      Yeah.

   8. SPSpeaker24:18

      Yeah.

   9. DSDavid Sacks24:19

      Renowned coder, created OpenClaw, which is kinda the thing that launched this whole agent era now, you, I guess you could say. Any event, he said that Anthropic was cutting off his accessTo, was it to-

   10. JCJason Calacanis24:32

       Okay, that's, yeah

   11. DSDavid Sacks24:32

       ... was to Claude? Is that the next topic, Jason, or?

   12. JCJason Calacanis24:34

       This is on the docket.

   13. DSDavid Sacks24:35

       Okay.

   14. JCJason Calacanis24:35

       It's a little bit nuanced. Everybody using OpenClaw would take their $200 a month subscription to Anthropic, which was essentially like a, people were using more tokens, and it's an average. The people from OpenClaw, it is very verbose, and those people are 100X the usage of the average subscriber. So he said, "You can't use your 200. You have to use the API." You move from the $200 plan to the API, add a zero to your token use, so, or more. And so they essentially ankled OpenClaw, and then 10 days later or less, they released or announced their new agent technology, which is, uh, according to them, a safer, better version of OpenClaw. So, hey, all's fair in love and war, and they have basically shot a huge cannon across the bow of OpenClaw.

   15. DSDavid Sacks25:25

       Wait, can you just explain that exactly? So, so I think you're right that they systematically copied feature by feature of-

   16. JCJason Calacanis25:32

       Yes

   17. DSDavid Sacks25:32

       ... OpenClaw, incorporated that into Claude, and then the coup de grâce was basically cutting off OpenClaw?

   18. JCJason Calacanis25:38

       The oxygen, yes.

   19. DSDavid Sacks25:39

       Can, could you just explain exactly what they did?

   20. JCJason Calacanis25:41

       Okay, very simply, when you buy a subscription to these services, they have blended your usage across many users. So there's, you know, nine out of 10 users use less than the tokens they're paying for, and the top 10% use much more. When OpenClaw became a phenomenon, the number one open source project in history on GitHub with all of this usage, people went crazy, and you heard me talking about how crazy I went for it. Those people with the $200 subscriptions were using 2,000, $20,000 worth of tokens. So they said, "You can no longer use your subscription to, you know, either your professional or enterprise subscription at $200 and plug that into your OpenClaw. You now have to go to the API and pay per usage." So no more, like, unlimited essentially.

   21. DSDavid Sacks26:27

       But if you use, if you use Anthropic's own agent harness, are you part of the bundled flat rate?

   22. JCJason Calacanis26:33

       You can assume that that's what they'll do, which if you were thinking on an antitrust level, might be token dumping or price dumping. I'm not saying, like I'm ratting them out, like they-

   23. DSDavid Sacks26:42

       Or bundling. No, it's like bundling, isn't it?

   24. JCJason Calacanis26:43

       Well, price dumping or bundling. When you price something under the market price in antitrust, that would be price dumping, right? And if you were to bundle, it would be, like, the bundling issue.

   25. BGBrad Gerstner26:53

       Critically important.

   26. JCJason Calacanis26:55

       Yeah.

   27. BGBrad Gerstner26:55

       You can use OpenClaw via Claude API.

   28. JCJason Calacanis26:57

       Yes.

   29. BGBrad Gerstner26:58

       And every company has a right to set the price for its products. It's just saying that you were for, under their current regime, they were selling dollars for 10 cents via-

   30. JCJason Calacanis27:06

       Yes
4. 42:20 – 58:01

   Anthropic $30B run rate, fastest revenue ramp ever, the TAM for intelligence

   1. JCJason Calacanis42:20

      point. Let's talk about the revenue ramp of Anthropic. This is just unprecedented. Anthropic's revenue run rate has topped thirty billion with a B. Early twenty twenty-three, they turned on revenue. They started charging for API access. End of twenty twenty-four, they're at a billion dollar run rate. February twenty-five, they launched Claude Code. That was the starter's pistol. Mid-twenty twenty-five, four billion dollar run rate. End of twenty twenty-five, nine billion dollar run rate. Just a couple of months later in April, thirty billion dollar run rate. Yes, that's right, triple. Uh, and the way they did this is enterprise, uh, customers are a major part of the spend.Dario announced a couple of months ago that there's over a thousand enterprises paying over one million annually. This is truly mind-boggling when you think about it, 'cause those are the most coveted customers in the world. These are the big fish that you just, uh, when people are running enterprise software, they, they dream. Slack dreamed of getting these million-dollar customers. Uh, Salesforce dreams of getting these million-dollar customers. Brad, you're an investor. I guess, uh, Sam famously on BG2 asked you to sell your, uh, OpenAI stock back to him.

   2. BGBrad Gerstner43:32

      [laughs]

   3. JCJason Calacanis43:32

      You didn't, you demurred, but you're an investor in both. How shocking is it to you to place both of those bets and then see one of them come from so far behind? You know, ChatGPT has nine hundred million users. I don't know if they've s- they've passed a billion officially yet, but they are the verb, right? They're the Uber, they're the Xerox, they're the Polaroid of AI, but they didn't go after the enterprise. Dario made that, and Dario worked. He was the co-founder of OpenAI. He left, and according to the New Yorker story that came out from Ronan Farrow this week, he was basically left because of his disgust in working with Sam Altman. Your thoughts, Brad.

   4. BGBrad Gerstner44:13

      Well, well, you know, before we go down the OpenAI rabbit hole, let's just really contextualize, like, what's going on here. You know, Cha-- I, I, I have this additional chart. You showed one. You know, they added four billion of revenue in January, seven billion in February, eleven billion of annualized run rates, um, or ten or eleven billion in March. Just to put in perspective, that's Databricks plus Palantir combined that they added in a single month, right? So we started with everybody at the start of the year wringing their hands, including y- you know, Gurley and others saying, "We're in a big bubble," asking whether the AI revenues would show up to justify all of this investment, and bam, you have the largest revenue explosion in the history of technology. So the company's plans were to end the year at about a thirty billion dollar ex- exit run rate. They got there by the end of March, right? And I suspect that it's continuing in April. So you have to ask what's going on and what's the big so what? The first thing for me is that model and product capability just hit this threshold we talked about earlier, near AGI, whatever the hell you wanna call it, and everybody, like Altimeter, said, "Damn, this is so good, I have to have it. This is no longer about my IT budget. This is about labor augmentation and labor replacement." And by the way, CoWork is growing even faster than Claude Goad at the same stage of development. So what it showed is we have a near infinite TAM. It turns out that the TAM for intelligence is radically different than anything that we've seen before. And I think the best example of this, right? This is millions of self-interested parties, consumers, enterprises, a thousand now over a million dollars, right? It's not that there was some great go-to-market in Anthropic that all of a sudden, you know, they snuck up and blew everybody away. No, it was companies demanding the product. They're getting throttled on the product. Why? Because it's so good, it makes them better at their business. We are all self-interested actors, and when millions of those people are all making the same decision, there's a huge tell. And the tell here is that the TAM is as big as Dario and Sam and others have been saying. We knew intelligence was going to scale on the exponential. The question was whether revenue will scale on the exponential, and that's what we're seeing. And remember, they're doing this with only one and a half to two gigawatts of compute, right? These guys are massively compute constrained. They're each gonna be adding three gigawatts of compute this year, and so that will unlock s- they would be, uh, uh, growing even faster but for that. And then Jason, to your point about the open source models that we all want to be a part of this solution. I've talked to a lot of big companies. Sixty-five to seventy percent of their token consumption is open source model, right? Are these cheap Chinese and other tokens. So these revenue ramps are happening while the world is already using open source. This is not frontier only. This is frontier plus open source. We're gonna see massive token optimization over the course of the year, but what happens on this Jevons paradox is the co- the unit cost, right, of intelligence is plummeting, not the cost of tokens. The unit cost of intelligence is plummeting because the capabilities of these models is so much better. I look at what it does for Altimeter day in and day out. I talked to a major, uh, company yesterday. They're on a run rate to do a hundred million of token consumption this year on about five billion dollars in OpEx. They think that we're now nearing peak employment in their company, but that their token, their intelligence consumption, okay, let's not call it token consumption, right? Because tokens may go up a lot, but their intelligence consumption-

   5. JCJason Calacanis47:55

      Got it

   6. BGBrad Gerstner47:55

      ... is going to go up a, uh, you know, a lot. So I would leave you with this. We're early, to Chamath's point. We have low penetration of the Global two thousand. We have low penetration of the use cases. We have low penetration of, uh, within the use cases that they're already using, and the models are only getting better. So I think when you look out toward the end of the year, I would not be shocked if you see Anthropic exiting this year at eighty to a hundred billion dollars in revenue.

   7. JCJason Calacanis48:26

      Wow.

   8. BGBrad Gerstner48:26

      And by the way, doing it at the same time that OpenAI, who is also on the wave, they'll be releasing an incredible model in the next, uh, uh, uh, imminently. They're gonna be on that wave, and you're gonna see an inflection in their revenues as well.

   9. JCJason Calacanis48:38

      Okay, Chamath, question one has been answered. The question of, "Hey, does this stuff actually have utility?" That went from a question mark to an exclamation point. Of course, it's got utility. People are getting value from it, and it might be variable. Some people get more value than others. Number two, the revenue ramp was a big question. Now that's turned into an explanation point. The final piece of the puzzle that you've brought up many times is can this be profitable? And these companies are burning through a large amount of cash. So what is your take on when these companies can get out of the J curveWe talked about this, I think, three episodes ago. I estimated, like, we're gonna be looking at four or five hundred billion dollars in investment into these data centers at a minimum, and then they have to climb out of that to get to profitability. So what are your thoughts on these becoming profitable companies?

   10. SPSpeaker49:26

       Do you remember that investor that published this list, Jason, where he put all of the terms you talk about when one of the terms you can't talk about is profit? It's a list where it's like, if you can't talk about free cash flow, you talk about EBITDA.

   11. JCJason Calacanis49:43

       Yes.

   12. SPSpeaker49:43

       When you can't talk about EBITDA, you talk about margin.

   13. JCJason Calacanis49:46

       Cumulative EBITDA. [laughs]

   14. SPSpeaker49:47

       When you can't talk about that, you talk about revenue, and then when you can't talk about revenue, you talk about [laughs] gross revenue.

   15. JCJason Calacanis49:53

       Page views. Bookings.

   16. SPSpeaker49:54

       So you can kind of figure out, I think, where we are in any part of any cycle by just indexing into what does everybody talk about?

   17. JCJason Calacanis50:06

       Mm.

   18. SPSpeaker50:06

       I think where we are is we are between gross revenue and net revenue. That's where the discussion is.

   19. JCJason Calacanis50:13

       Okay.

   20. SPSpeaker50:14

       There was another article, I think today, in I think maybe it was The Information, that tried to categorize and distinguish that Anthropic presents gross, OpenAI presents net. They're different. We don't know what the various take rates are. So they're saying that there's a difference. If it's not true, there's been no clarity provided by these companies. So at a minimum, you have this confusion, where there's the breathless talk, then there's people that don't even know the difference between actual recognized revenue and run rate revenue-

   21. JCJason Calacanis50:45

       Totally

   22. SPSpeaker50:45

       ... and how to multi...

   23. JCJason Calacanis50:46

       Yeah.

   24. SPSpeaker50:46

       I mean, so we're definitely there, okay? We can quibble about the details, but we are not at the place where people are like, "Oh, here's your steady state, you know, free cash flow margin, and here's what your EBITDA is."

   25. JCJason Calacanis50:56

       [laughs]

   26. SPSpeaker50:56

       We're never... We're, we're years from that.

   27. JCJason Calacanis50:58

       They're gonna have token maxing EBITDA, like a cumulative EBITDA at WeWork. [laughs]

   28. SPSpeaker51:02

       The thing that we need to understand is how gross margin negative is this revenue growth.

   29. JCJason Calacanis51:07

       Mm.

   30. SPSpeaker51:07

       We don't know that, and at least we don't as outsiders.
5. 58:01 – 1:10:12

   Major vibe shift: Anthropic ripping, OpenAI reeling

   1. JCJason Calacanis58:01

      Brad, you didn't answer my question about the vibes over at OpenAI versus Claude. OpenAI is, um, uh, I wouldn't say reeling, but there's a lot of hand-wringing going on, a lot of employees leaving, a lot of people who are wondering, like, "Is our strategy the winning strategy of, like, consumer first?" They shut down Sora, you know, unwinding the Disney deal and really trying to get the company focused. And it's kind of like w- I mean, listen, the New Yorker story was a bit of a rehash, so I don't think we have to go into the blow-by-blow because w- we covered it here three years ago. But the truth is, a lot of the great founders, co-founders of OpenAI and a lot of the great contributors are now at Anthropic and other large language models. And in the secondary market, OpenAI is trading lower than the last valuation, and Anthropic is trading significantly above the $380 billion. So maybe talk a little bit about this competition, this Microsoft versus Apple, this Google-

   2. BGBrad Gerstner59:02

      Yeah

   3. JCJason Calacanis59:03

      ... versus Facebook moment.

   4. BGBrad Gerstner59:03

      Well, let's, l- l- let's start with immense credit where credit is due. Anthropic was literally counted out of the game last year.

   5. JCJason Calacanis59:10

      Yep.

   6. BGBrad Gerstner59:10

      Right? And here they come over the last 12 months and, and, and they've kicked OpenAI's ass over the last 90 days, right? And what did Anthropic do? Anthropic made choices. No multimodal, no video, no hardware, no chips, no building data centers. They said, "We're just gonna focus on coding and co-work. We think that is the path to AGI and, and, and, and ASI." They executed their butts off. They took the lead. 2,500 people, tight, pulling on the oar in the same direction. But I think you would be seriously foolish to count out OpenAI, right? And I think we're at p-

   7. JCJason Calacanis59:45

      Why? Why?

   8. BGBrad Gerstner59:45

      We're at, we're at peak OpenAI FUD, and I'll tell you, it starts with great researchers and great models. And I think when you see the Spud model they're about ready to release, I think it's going to be an excellent model. Shows that they're firmly on the wave. Um, if you look at what's going on with Codex, incredible ramp on Codex. Fastest ramping model with 5.4, I think 5.5 are Spud, whatever we're gonna call it. It's gonna be an even faster ramp.

   9. JCJason Calacanis1:00:09

      Have you seen Spud? Have you used it? Have you gotten a preview?

   10. BGBrad Gerstner1:00:13

       People are using Spud, right?

   11. JCJason Calacanis1:00:15

       Okay.

   12. BGBrad Gerstner1:00:15

       So it, it, it is being previewed and so-

   13. JCJason Calacanis1:00:18

       So you're talking to people who've used it, and what are they s- telling you?

   14. BGBrad Gerstner1:00:21

       They're telling us that it's an incredible model on par with Mythos, right? And that it's a, a, a very usable model in terms of, um, how it's packaged. I will say that, back to David's point, now this is the most important point I think anybody can take away here. This is not zero sum. The TAM of intelligence is dramatically larger than any TAM we've ever seen in our investing careers over the last two decades, right? And if you're on the wave which OpenAI is, you are going to be selling into the world's biggest TAM. They are going to build a very big company. I'm a buyer of the shares today, notwithstanding all of the vibes that you describe. I think these companies are firmly on the wave. They are jarred. They are sitting there saying, "What did we do wrong and how do we get our mojo back?" They wanna compete. It is embarrassing to people on the research team and the product team over there. So I'm not saying there's a, a, not a real awakening occurring there, but I think that's what, uh, the case is. And by the way, to Chamath's point, do not count out Meta, right? I think Meta is absolutely in this game. Google is absolutely in this game. Elon... is absolute in this game, and if you're on t-

   15. JCJason Calacanis1:01:31

       Yeah, Elon's got some stuff dropping shortly that's gonna be very impressive.

   16. BGBrad Gerstner1:01:34

       If you're on Team America, the fact that [laughs] we have five frontier models competing against each other, and David made sure they weren't throttled by excessive government regulation. We have Mythos come out. It's a self-imposed safe harbor, you know, to harden our system. It's wasn't a call for moratoriums or getting the government involved. We have the type of competition that's causing us to accelerate our lead against the rest of the world. We can't take our eye off the prize. We gotta stop adversarial distillation, and we need to make sure that we're distributing our products around the world. But I view this as really good for Team America.

   17. JCJason Calacanis1:02:09

       Well said, and here is your Polymarket IPOs before 2027. Obviously, SpaceX at 95%, uh, Cerebras at 94%, and, uh, hey, number five on this list, 51% chance that Anthropic goes out before the end of the year, 44% chance that OpenAI comes out before then. All right, here is the closing market cap for Anthropic on Polymarket. Only $158,000 in volume, so Chamath, when you put in 400K, [laughs] you're gonna really tilt this market. 78% chance that it's above 600 billion, 19% chance that it doesn't go out. So it's looking like this will be a decent investment for you. Brad, what valuation did you get into Anthropic at?

   18. BGBrad Gerstner1:02:57

       We first invested in, I believe it was the 130 or $150 billion round.

   19. JCJason Calacanis1:03:04

       So this will be a 7X, 5X for Altimeter. L please, congratulations.

   20. BGBrad Gerstner1:03:08

       I mean, no, listen. I, I, I, again, there are lots of people who were there before us and who are on the board and who are gonna do better than us. But, but-

   21. JCJason Calacanis1:03:14

       Yeah, what'd you put in the big bet? What'd you put in, 50?

   22. BGBrad Gerstner1:03:16

       [laughs]

   23. JCJason Calacanis1:03:17

       100? What'd you put in?

   24. BGBrad Gerstner1:03:18

       No, we've got billions in both companies, uh, at this point.

   25. JCJason Calacanis1:03:20

       Billions in both companies.

   26. BGBrad Gerstner1:03:22

       Yeah, yeah.

   27. JCJason Calacanis1:03:22

       Oh, my lord.

   28. BGBrad Gerstner1:03:23

       Um, yeah, but listen-

   29. JCJason Calacanis1:03:24

       Yum, yum

   30. BGBrad Gerstner1:03:24

       ... I think w- there's this existential thing going on in venture today, uh, David could talk about it as well. I mean, people can't... They're extraordinarily nervous about... You look at the IGV stock index, down 30% year to date, down 5% today, all software stocks plummeting, right? Venture capitalists are terrified to invest money in anything other than these frontier models and things like SpaceX or military modernization. Finding something that's out of harm's way of AI, right, where you can count on the terminal value, to Chamath's insights over the last few weeks, is very difficult to do. That's why you see this crowding. So we've taken a, a barbell approach, right? We've got a lot in what we think are the most important companies that are on the frontier, and then we're betting with, on really small teams that we think have very defensible businesses in a world of, uh, you know, AGI. But it's tricky.
6. 1:10:12 – 1:29:14

   Iran War: Ceasefire, Israel's influence, market impact

   1. JCJason Calacanis1:10:12

      war. Here's the latest. Two weeks into a ceasefire have started just two days ago at the taping of this. VP JD Vance, friend of the pod, is a... and some special consultants, uh, Witkoff and friend of the pod, Jared Kushner, are headed to Islamabad, the capital of Pakistan, for talks this very weekend. So while you're listening to this event, they are going to be working on the peace deal. Easter Sunday, Trump posted a truth stating, "Open the [censored] strait you crazy bastards or you're gonna be living in hell. Just watch. Praise be to Allah." On Tuesday morning, Trump posted, uh, a th- another threat on social media. "A whole civilization will die tonight, never to be brought back again. I don't want that to happen, but it probably will." Tweets were obviously discussed, uh, a lot over the last week. He gave them an 8:00 PM deadline. At 6:30 PM, POTUS announced on Truth Social that he had agreed, that President Trump had agreed to a two-week ceasefire if Iran opens the strait. He also said, "Hey, listen, we got the strait. Maybe there'll be a toll booth, but we'll take the majority of the toll, and we'll split it with Iran." Here's the quote. "We received a 10-point proposal from Iran, and we believe it's a workable... It is a workable basis on which to negotiate." And apparently, Netanyahu took the ceasefire to mean level Lebanon, dropping 160 bombs in 10 minutes yesterday. Sacks, uh, you were out last week. Everybody wants to know your position on the war. I'll hand it off to you. What are your thoughts on how, uh, on the two-week ceasefire and everything that's occurred up until this point?

   2. DSDavid Sacks1:11:47

      Well, look, I have to preface what I'm about to say, which is I'm not part of the foreign policy team at the White House, and the last time I commented on the war on this show, it somehow made international headlines that-

   3. JCJason Calacanis1:12:01

      Mm-hmm

   4. DSDavid Sacks1:12:01

      ... Trump advisor says XYZ.

   5. JCJason Calacanis1:12:05

      X.

   6. DSDavid Sacks1:12:05

      And I'm not a Trump advisor on this issue. I think that'd be a fair headline to write if it was a technology issue, but this is not. So whatever I say is just my personal opinion, but then the media's gonna somehow portray it or attribute it-

   7. JCJason Calacanis1:12:18

      Okay

   8. DSDavid Sacks1:12:18

      ... to the White House or try and create an issue out of it. So I feel like I'm limited in what I can say, except that to say that I think it's terrific that we have the ceasefire. I think it's great that there's gonna be this meeting in Islamabad to hammer it out, and I think what the president's accomplished so far with the ceasefire is it's a great thing. Because what happens with these wars is they take on a life of their own, meaning they tend to go up the escalation ladder, right? And there's a lot of podcasts that are discussing this so-called escalation trap, and supposedly there are stages to this based on historical patterns. And so I think it's actually very hard to pull out of these things, and I give the president tremendous credit for negotiating the ceasefire that we've achieved so far and then sending the team to hopefully work this out.

   9. JCJason Calacanis1:13:07

      Brad, actually, my first trip to the Middle East was when you and I, uh, maybe four years ago went. Thank you for taking me. And what is your take on where we're at here? I think we just wrapped up week six of this, and we're going into week seven.

   10. BGBrad Gerstner1:13:17

       First, uh, o- on March 4th, I tweeted, "The Trump doctrine in Iran, massively destroy all military ca- capabilities, kill the people building lethal weapons to use against us, and get out. Reserve the right to do it again if needed. Zero efforts to build Madisonian democracy. Iran's gonna have to build what comes next." And I think what the market has said, right? If you look back at last year on tariffs, Jason, the top to bottom drawdown was about 15%. On the NASDAQ, intraday was down 22%, okay?

   11. JCJason Calacanis1:13:49

       Hmm.

   12. BGBrad Gerstner1:13:49

       The drawdown in this period over Iran was only down about 5 to 7% on S&P and NASDAQ, right? So the market has said, "Listen-re-- trust Trump at his words. He said he's not gonna get into an entangled war here. I think he terrifies the hell out of people with his tweets about, you know, destroying civilization and all this other stuff. But I think people, even though they don't like to hear it, they've resolved for themselves that when he says he's gonna get out, he will in fact get out. Of course, there was a lot of hand-wringing, but if you look at the markets today, we basically bounced all the way back from where we were pre-Iran on both the S&P and the NASDAQ. If, in fact, we land the plane, if JD lands the plane... And by the way, on Lebanon, yes, they were bombing yesterday, but Netanyahu has now said that you're gonna have direct government talks between Israel and Lebanon. So if the, i-if we land the plane on these th- two things, I think it's off to the races in the market. And by the way, while everybody's focused on Iran, stay tuned. I think we're getting close to a deal on Ukraine-Russia, right? Venezuela is, you know, kind of going seemingly very well. I think there's also gonna be news on Cuba. You could envision a world. There's risk to the downside, certainly, I will stipulate, but you also have to pay attention to the risk to the upside. If you land the plane on those things, heading into America 250 July 4th, the market could really take off.

   13. JCJason Calacanis1:15:11

       All right. Well, let, let's, uh, maybe up-level this a little bit and talk about why we're in this war to begin with, and that's the big discussion amongst both sides of the aisle. On Tuesday, The New York Times dropped an inside the room piece on how President Trump made the decision. According to this report, if it's true, I know some people don't, uh, subscribe to The New York Times anymore or think it's fake news, but how Trump decided to basically follow Netanyahu into this war. On February 11th, Netanyahu met with Trump at the White House, where he gave him a four-part pitch on attacking Iran. JD Vance, according to the story, if it's true, disclaimer, disclaimer, warned Trump that the war could cause regional chaos and break apart Trump's MAGA 2.0, the Trump 2.0 coalition we talked about here, the big tent, and that's turned out actually to be true. There's been a bunch of hand-wringing from Megyn Kelly, Tucker Carlson, right on down the line. Rubio was anti-regime change, but he was largely ambivalent according to this story about the bombing campaign. Susie Wiles, chief of staff, said she had concerns about gas prices before the midterms. Pretty good, uh, advice there. And General Dan Kane, chairman of the Joint Chiefs of Staff, said this of Netanyahu's pitch, quote, "Sir, this is, in my experience, standard operating procedure for the Israelis. They oversell, and their plans are not always well-developed. They know they need us, and that's why they're hard selling." If you put this together with Rubio's walked back comments at the start of the war, we knew, this is a quote from Rubio, "We knew there was going to be an Israeli action. We knew that would precipitate an attack against American forces, and that's why we did it." I had Josh Shapiro on the All-In Interview show, and, um, uh, he talked a lot about this. There is a big underpinning here, Chamath, that the United States foreign policy is being driven by Netanyahu. Every Jewish American person I've talked to feels Netanyahu is not doing Jewish American and, and Jewish, the Jewish diaspora any favors here by his approach to these wars. What are your thoughts on why we got into this and how we get out of it?

   14. SPSpeaker1:17:23

       I mean, the person that decides is the President of the United States. Some foreign leader isn't getting to call the shots in the United States. I think very practically speaking, the markets are effectively pricing in that this was a small blip for whatever people think. That's just what the best prediction market that we have is telling us. I think that's important to acknowledge that we're probably in the endgame here. And the second thing to acknowledge is if I was Israel, I would really be concerned that unless I help find an off-ramp quickly, the risk that Israel loses America as a predictably steadfast ally could go down, and I think that that's problematic for Israel far more than-

   15. JCJason Calacanis1:18:11

       Yeah

   16. SPSpeaker1:18:11

       ... it's problematic for the United States. So all of that kind of tells me that we will find an off-ramp, A, because I think economically it makes sense, and then, B, geopolitically, I think Israel will wanna make sure that this doesn't burn a long-standing relationship.

   17. JCJason Calacanis1:18:29

       Yeah. I... That, that seems to me to be the major issue here is Americans basically do not wanna be in this war. Americans do not want our foreign policy being influenced to the extent they believe, so I'm not putting my belief in here, just Americans believe we are being dragged into this by Israel and that Israel has too much, or Netanyahu specifically, has far too much influence. And then people believe the antisemitism that's occurring here, Josh Shapiro gave me a lot of pushback on this. Uh, but all the Jewish Americans I talk to say Netanyahu's causing, with his actions in Gaza, Lebanon, Iran, uh, he's gone too far, and it's causing the antisemitism we're experiencing, uh, today. So you can make your own decisions about that. Any final thoughts here, Brad, on the American foreign policy being influenced too much by Israel?

   18. BGBrad Gerstner1:19:18

       No, I, I-

   19. JCJason Calacanis1:19:18

       It's the discussion of the moment

   20. BGBrad Gerstner1:19:20

       ... I, I, I, I mean, listen, um, uh, uh, kinda like Sacks said earlier, um, I think that we will ultimately be judged by the outcomes, right? And the... Everybody is an armchair pundit today on, you know, uh, the, the, the approach that we're taking in these two different places. I think we could be on the verge of a massive transformation of the Gulf states. You went there with me, Jason. Saudi, Qataris, Kuwaitis, Emiratis, I've talked to a lot of them this week. I think they're very hopeful and optimistic. I think you could bring Iran into the fold. But listen, I'm an optimist on all of this stuff. I, I just wanna remind people, doing nothing in IranHad tremendous risks. Doing nothing in Venezuela had tremendous risks. So it's not as though this was, uh, you know, something that I, I, I, I think wasn't well calculated, but I think we have to let the cards be played and, and, and then let history be the judge. But I think there's, uh, a, a risk in both directions, but I'm gonna remain optimistic.

   21. JCJason Calacanis1:20:26

       All right, Sax. You, uh, said in the Gaza situation we should have a wide berth for criticism of Israel and Netanyahu. What are your thoughts on this belief here in the United States now in this discussion that Israel's having far too much influence over the United States' foreign policy?

   22. DSDavid Sacks1:20:42

       Well, I noticed in my feed today that Naftali Bennett, who's a major Israeli politician who was a former prime minister, tweeted polling that showed that Israel was becoming very unpopular in the US, and he was expressing concern about that and expressing the need to, to basically address that or fix that. So I think you're starting to see Israeli politicians raising that as an issue, and I think that's probably a good thing. Yeah, there it is. And it's really cool actually how X now just automatically translates things from foreign languages, in this case Hebrew, and it puts it in your feed. So yeah, so here's Naftali Bennett, former prime minister, saying, "This is a serious situation. There's a lot of work ahead of us to fix everything." Now obviously this is not Netanyahu. This is one of his, um, political opponents. But yeah, I mean, this is something for Israel to consider and think about, and I think that they would improve their popularity, uh, if they got behind the ceasefire, and I have no indication that they won't. But that would certainly be a good place to start.

   23. JCJason Calacanis1:21:49

       I have to say, just, uh, as an aside, this auto translate feature has done more [laughs] for understanding across borders than anything I've ever seen, and it is the most impressive tech feature I, I've seen released in years, putting AI and large language models aside. For people who don't know what's happening, because of Grok being really good at doing auto translate, they've taken the pockets of the best of what's happening in Japan, what's happening in Israel, what's happening in France, and they're surfacing it auto translated. Then when you reply as an American to somebody in Japan, they see it auto translated as well, which has led to people who don't speak the same language engaging on X in a very nuanced, fun, interesting way. And that for, as a truth mechanism, is just absolutely extraordinary. I think this is gonna have such a profound effect. Maybe Elon and the X team should get like, uh, a Nobel Peace Prize award for this. I think it's gonna change ... I mean, I, I hate to be hyperbolic, but have you been using this feature, Chamath? Has it been coming up in your feed? A- and w- which language is up in your feed right now?

   24. SPSpeaker1:22:58

       English. [laughs]

   25. JCJason Calacanis1:23:00

       Okay. So you're not part of the translation thing. Brad, has this hit your feed yet, and, and which regions are you seeing?

   26. BGBrad Gerstner1:23:06

       Definitely, definitely see it in, on the Middle East stuff. Um, and, uh, uh, you know, I've seen it on Chinese. I've seen it on, on the Russian stuff.

   27. DSDavid Sacks1:23:12

       Japanese.

   28. BGBrad Gerstner1:23:14

       S- super helpful.

   29. DSDavid Sacks1:23:14

       Let me tell you, based Japanese is a whole nother level of based.

   30. JCJason Calacanis1:23:17

       [laughs] Whoa, man.

Episode duration: 1:29:17