All-In PodcastE146: Did the Fed break the VC model? Plus IPOs, M&A, revaluing unicorns & more
CHAPTERS
- 0:00 – 3:15
Cold plunge banter, health hacks, and longevity talk
The besties open with teasing about cold plunges, sauna routines, weight loss, and the wellness optimization trend. They trade notes on temperatures, cycles, supplements, and the broader culture of affluent biohacking.
- •Cold plunge temperature one-upmanship and sauna/cold cycling routines
- •Wellness gadgets: blue-light glasses, sleep optimization, supplements
- •Hormone talk: testosterone, HGH skepticism, and “off-menu” medical interventions
- •Comic riffing on personal routines and first-world self-improvement
- 3:15 – 6:19
GOP primary dynamics: Vivek surge, candidate “acceptability,” and key litmus tests
The conversation pivots to the Republican primary, focusing on Vivek Ramaswamy’s polling momentum and how voters may compare him to Trump. Sacks frames his decision-making as a binary acceptable/unacceptable screen with Ukraine escalation as the core litmus test.
- •Vivek’s rising polling and the “younger Trump with upgrades” framing
- •Debate access and the role of platforms in shaping candidate evaluation
- •Sacks’ foreign-policy litmus test: preventing escalation in Ukraine/avoiding WWIII
- •Acceptable vs. unacceptable candidates; DeSantis and Vivek as “acceptable”
- 6:19 – 11:37
Fiscal emergency and why bipartisanship is hard: debt service, deficits, and political incentives
They debate the feasibility of addressing the US fiscal situation, focusing on the need for bipartisan cover to cut major programs. The group argues restraint is more likely to be imposed externally via bond markets than internally via Washington politics.
- •Debt service costs crossing $1T/year and refinancing at higher rates
- •Sacks: fiscal fixes require bipartisan alignment; foreign policy is more unilateral
- •Historical examples: Reagan/Tip O’Neill reforms; Obama-era sequester dynamics
- •Prediction that market pressure (rates, bond demand) forces eventual restraint
- 11:37 – 24:10
All-In Summit 2023 highlights: standout speakers, production lessons, and favorite moments
They recap the All-In Summit 2023, praising the lineup and sharing favorite on-stage moments and quotes. Discussion includes conference “editorial direction,” technical hiccups, and why the event felt more optimistic and substantive than other conferences.
- •Favorite talks and speakers: Dalio, Graham Allison, Larry Summers, Bill Gurley
- •Summers quote on self-esteem/achievement and cultural critique
- •Behind-the-scenes: production discipline, sound checks, tech issues
- •Positioning the summit as optimistic, substantive, and less virtue-signaling
- 24:10 – 25:57
IPOs and M&A reawaken: Cisco buys Splunk; Arm, Instacart, Klaviyo test the public markets
A burst of activity—Splunk’s $28B acquisition and multiple IPOs—prompts debate about whether this signals a true reopening. They set context with how rare meaningful venture-backed IPOs have been and what these deals imply for liquidity and pricing.
- •Cisco’s $28B all-cash Splunk acquisition and M&A green shoots
- •Arm, Instacart, Klaviyo IPOs after a long drought in venture exits
- •Question: true reopening vs. brief liquidity window for forced sellers
- •Discussion of late-stage investors underwater vs. early-stage winners
- 25:57 – 34:32
Why US IPOs feel “broken”: float size, anchor investors, lockups, and retail bag-holding
Jason critiques the structure of US IPOs versus Europe/Asia, arguing misaligned incentives produce poor outcomes. They dissect small floats, weak anchoring, and lack of lockups—leading to early pops, fast selling, and prices falling below issue.
- •EU/Asia: large anchors plus mandatory holding periods vs. US quick-flip incentives
- •Recent IPOs had <10% float; allocations spread across many funds
- •No lockups for key buyers encourages immediate selling pressure
- •Direct listings vs. IPOs: price discovery, volatility, and incentives
- 34:32 – 42:50
Are IPOs the wrong scoreboard? Business fundamentals vs. day-one pricing theatrics
Friedberg argues IPO day-one performance is a bank-driven psychological game and not a real measure of business success. They explore efficient-market thinking, long-term value creation post-IPO, and why CEOs can get distracted by stock noise.
- •IPO day-one pop as marketing; not necessarily tied to intrinsic business value
- •Most value for Apple/Microsoft/Google accrued after IPOs
- •Direct listing debate: Spotify vs. Slack/Coinbase experiences
- •Stock price volatility can distract operators despite long-term fundamentals
- 42:50 – 48:27
Instacart under the microscope: ad-driven revenue mix, take-rate risk, and late-stage losses
They review Instacart’s reported metrics and interpret its business increasingly as advertising-driven rather than pure commerce enablement. The group debates take-rate durability, competitive pressure, and how returns compare to public market alternatives.
- •Instacart metrics: modest revenue growth, ad revenue rising, GTV flat
- •Ad revenue cyclicality and multiple compression in higher-rate environments
- •Platform take-rate tends to decay under competition; modeling defensibility matters
- •Visualization of venture vs. S&P alpha; illiquidity premium becomes harder to justify
- 48:27 – 55:32
Did the Fed break the VC model? LPs demand early entry, real edges, and better alpha vs. risk-free rates
They connect higher-for-longer rates to the venture funding slowdown and tougher LP decision-making. The discussion centers on LP preference shifts toward seed/Series A, manager culling, and the need for genuine differentiation to raise new funds.
- •LPs shifting earlier (seed/A) and reducing late-stage exposure
- •Manager consolidation: fewer commitments, cutting weaker funds/positions
- •Raising in a 5–7%+ risk-free world raises the hurdle rate for VC performance
- •“Edge” requirements: distribution, dealflow, unique sourcing advantages
- 55:32 – 1:00:49
Klaviyo’s IPO as the SaaS benchmark: growth, retention, and platform dependency on Shopify
Sacks frames Klaviyo as a yardstick for SaaS valuations, citing strong growth, margins, and net revenue retention. They also discuss existential platform risk—how reliance on Shopify requires alignment via equity/rev share to reduce rug-pull risk.
- •Klaviyo: high growth, strong NRR, capital efficiency; sets valuation ceiling for SaaS
- •Explaining NRR and why expansion offsets churn even in SMB-heavy bases
- •Platform dependency: ~70% Shopify exposure and “rug-pull discount”
- •Strategic alignment: Shopify ownership stake and rev share to mitigate risk
- 1:00:49 – 1:13:06
Revaluing Airtable and ZIRP-era unicorns: pref stacks, down rounds, recaps, and boardroom warfare
Airtable becomes a case study in ZIRP-era overvaluation and overfunding, where growth slows and public comps reset multiples. They explore how preference stacks can exceed company value, triggering recaps that wipe out employees/founders and create investor conflict.
- •Airtable: strong product but low growth; valuation multiples vs. public comps
- •Many unicorns potentially worth less than total capital raised/pref stack
- •Board tensions: late-stage prefs vs. early/common and founder incentives
- •Recap mechanics: new option pools, pay-to-play, management turnover, predatory terms
- 1:13:06 – 1:24:19
Fed pause but ‘higher for longer’: discount rates reprice tech, runway planning extends into 2026
They react to the Fed’s messaging and the market’s repricing of expected cuts, emphasizing the impact on growth stock valuations. Jason and Sacks translate how higher discount rates compress multiples and why startups must plan for longer capital scarcity.
- •Market had priced more cuts; Fed guidance pushes expectations out
- •Higher discount rates reduce SaaS valuations (multiple compression)
- •Founders urged to extend runway: from mid-2025 guidance to 2026+
- •Regime change: capital abundance to scarcity; M&A as a survival path
- 1:24:19 – 1:33:43
What breaks next? Consumer strain, housing lock-in, credit cards, autos, unions, and automation
They debate whether consumer resilience is finally fading as debt costs rise and big-ticket purchases slow. Auto strikes and wage demands collide with affordability constraints, while automation accelerates as businesses respond to labor pressures.
- •Consumer coping behaviors: delaying upgrades (phones, cars) and housing moves
- •Housing ‘lock-in’ from low mortgages; transaction volumes crater
- •Auto industry: union demands vs. high rates and EV competition (Tesla price cuts)
- •Automation as the structural response to wage pressure and labor scarcity
- 1:33:43 – 1:42:43
Science Corner: ‘inverse vaccine’ concept for autoimmune diseases via liver-mediated immune tolerance
Friedberg explains a Nature paper describing a technique to induce immune tolerance by delivering glycosylated antigens to the liver. In animal models, this approach prevented or halted autoimmune-like responses, suggesting a potential new therapeutic modality beyond immunosuppression.
- •Autoimmunity basics: immune system mistakenly attacks self-proteins
- •Mechanism: glycosylated antigen delivered to liver triggers regulatory pathways (Tregs)
- •Animal model results: stopping MS-like disease; implications for type 1 diabetes and more
- •Contrast with today’s tools: prevention (early exposure) vs. broad immunosuppression
