E173: Google buying HubSpot? FTX depositors not made whole, AI job fears, Ukraine joining NATO

Jason Calacanis 0:00 All right, everybody. Welcome back to the All In podcast, the number one podcast in the world, episode 173.

David Friedberg 0:07 (laughs)

Jason Calacanis 0:07 It's objectively, Freeburg, the number one podcast. I checked, I looked online. And, uh, things are cooking over here, uh, so much so that you may have heard we hired a new CEO. Welcome to the team, our new fifth bestie, Jon Hale.

David Friedberg 0:23 (claps) Yeah!

Jason Calacanis 0:23 Golf clap, everybody.

David Friedberg 0:24 Welcome, Jon.

Jason Calacanis 0:24 Let's get in there with the golf clap. Yes! All right, Jon, welcome to the program. Your first day was April 1st. It wasn't a joke. Literally was your first day. How has week one as CEO for All In been?

Jon Haile 0:40 It has been wonderful. Super dynamic. Really happy to be a part of the team.

Jason Calacanis 0:45 All right, there you have it. Sacks, you were a huge driver of this.

David Friedberg 0:50 (laughs)

Jason Calacanis 0:50 You spent so much time interviewing everybody, going through the resumes, checking the references, you know, and you- you really spearheaded this. Oh wait, you did nothing. I forgot. (laughs)

Chamath Palihapitiya 0:59 Sacks- Sacks-

David Friedberg 1:00 (laughs)

Chamath Palihapitiya 1:00 ... it's- it's spelled J-O-N. Jon.

David Friedberg 1:03 Yeah. Wait, who is this?

Jason Calacanis 1:04 Sacks, this is Jon.

David Friedberg 1:04 Who is this?

Chamath Palihapitiya 1:05 (laughs) Okay.

David Friedberg 1:06 You guys haven't met. You guys-

Jason Calacanis 1:08 Jon, David Sack- David Sacks.

David Friedberg 1:09 Nice to meet you.

Jason Calacanis 1:09 ... Jon.

David Friedberg 1:10 Nice to meet you.

Jon Haile 1:11 Likewise.

Narrator 1:14 We're going all in. We'll let your winners ride.

Jason Calacanis 1:17 Rain man, David Sacks.

Narrator 1:20 I'm going all in. And I said- We open sourced it to the fans and they've just gone crazy with it.

Jason Calacanis 1:25 Love you, Sacks.

David Friedberg 1:26 I-

Narrator 1:26 Queen of quinoa. I'm going all in.

Jason Calacanis 1:30 So Jon worked at the Russian Embassy. This is just a coincidence-

David Friedberg 1:33 (laughs)

Jason Calacanis 1:33 ... there were a couple Russia references. But he worked as an intern, uh, for Putin, somehow he wound up getting a gig. Uh, Freeburg, you actually led the- the- the incredible search here and we had hundreds of people apply. Why do you think, um, we wound up with Mr. Hale here?

David Friedberg 1:50 Yeah, we had a lot of folks and we met with a lot of folks, but Jon really stood out with, I think, his experience and his thoughtfulness about what we can do. So, so much of our work off the show obviously has gone into putting on the All In Summit, and we want to do more live events. And Jon has a very strong background in building incredible live experiences and events, which we think is gonna be a really important extension. I think we've- we realized over the last two summits how much community matters for All In, and how much getting people together matters, and how much the live content mattered. And so we want to do more of that. And hopefully Jon can take us to the promised land.

Jason Calacanis 2:29 Fantastic.

David Friedberg 2:30 So, Jon, thanks for- thanks for saying yes. It's awesome to have you.

Jason Calacanis 2:33 Yeah. All right. And, uh, as Jon's first, first duty, he is going to, next week, announce the details of the All In Summit 2024, our third edition. Chairman Dictator, Chamath Palihapitiya, you've been running All In with an iron fist in the group chat. Your thoughts on Jon and-

David Friedberg 2:54 (laughs)

Jason Calacanis 2:54 ... working with him and why we selected him? The iron fist, please go.

Chamath Palihapitiya 3:00 I think that there's a really important trend that we have stumbled into, which is that content creators are the modern form of demand generation for whatever else it is that you're gonna consume. And I think it replaces advertising, and I think it displaces traditional content. And so I was really interested in finding somebody that understood how to connect those dots in all of the different ways in which we can explore what our brand is capable of. And I thought he was the best example of having done one thing extremely well at scale, and curious enough to figure out the other parts. So, you know, I'm really excited to work with Jon.

Jason Calacanis 3:46 Yeah. Um, uh, and I'll just add to that, you know, I've been doing events my whole life. And when I saw Jon's actual, uh, event history and the events you've thrown, Jon, really spectacular in the detail. And I think you're gonna, the same way Freeburg leveled up year two of the conference, I'm- I'm really excited to see how you put your stamp on it and level up year three. A couple of housekeeping things here. Uh, you know, we are-

Chamath Palihapitiya 4:08 By the way, sorry, can I say one thing? Just to build on what you said.

Jason Calacanis 4:11 Absolutely, Chamath. Yeah.

Chamath Palihapitiya 4:11 There is so much room to build real communities.

Jason Calacanis 4:16 Mm.

Chamath Palihapitiya 4:16 And I think people are just so tired and bored with everything online. So-

Jason Calacanis 4:23 Mm.

Chamath Palihapitiya 4:25 I think offline experiences will be a huge value add in people's lives.

Jason Calacanis 4:30 Yeah, there's definitely a bridge from online to offline. And the- the All In meetups that Ray's been hosting, and River-

Chamath Palihapitiya 4:37 The best- the best example of-

Jason Calacanis 4:38 ... such a great example, you know.

Chamath Palihapitiya 4:40 The best example of, at scale, of online to offline are dating apps. And all I can see is that's a pretty dissatisfying experience for a lot of people.

Jason Calacanis 4:49 Mm.

Chamath Palihapitiya 4:49 And so outside of dating apps, there aren't many really great examples where like-minded people can hang out and have fun and, you know, talk, learn, party.

Jason Calacanis 5:01 It's really interesting-

Chamath Palihapitiya 5:01 So-

Jason Calacanis 5:01 ... you bring this up. I just finished Jon, um, Haidt's new book, uh, The Anxious Generation.

Chamath Palihapitiya 5:07 Yeah.

Jason Calacanis 5:07 I don't know if you've listened to it, but there's a pair of books out right now, Bad Therapy, and, uh, this one about kids. And the premise of his book, Chamath, is screen time, as you referred to, you know, people being online, not only is it bad for kids and adults, it's also blocking, to your point, real world connection. And so we all want a little bit more real world connection. And so Jon, welcome to the team. Additionally, I'll just, uh, two more housekeeping items here and then we'll get to the show. We're gonna have a one million subscriber party. If you want to be part of that one million subscriber party, you can increase your chances, we're not announcing how we're going to give the tickets away, but you can increase your chances by going to YouTube right now. Pause the show, subscribe to the All In podcast channel, hit the bell so you get the alert for the best chance at getting one of the golden tickets to the one million subscriber party. And we are at 486,000. When we add 14,000 more, we're gonna do a live Q&A with all the besties.So get in on that as well. John, uh, any- any parting thoughts here or comments? Uh, which bestie has been the most difficult e- to work with in the first month? Which one has been the most delightful? Go.

Jon Haile 6:16 It's been a pleasure across the board. I think, you know, part of the beauty of the show is that there are so many different personalities and viewpoints, and really happy to be part of the team. Excited for what we're going to continue building.

Jason Calacanis 6:28 How diplomatic. Who's been the worst to deal with? Who's been the terror? Be honest. Tell me.

Antony Blinken 6:31 (laughs) .

Jason Calacanis 6:31 You don't have to deal with them. We'll talk about it in your one-year review. All right, John, great job. Great, Sacks.

David Sacks 6:37 Likely you.

Jason Calacanis 6:38 Likely you.

Antony Blinken 6:39 (laughs) .

Jason Calacanis 6:39 Who's been the most neurotic? Likely Freberg. Who's been the most able to value-add?

Antony Blinken 6:43 Most neurotic.

Jason Calacanis 6:43 Likely me.

David Sacks 6:44 (laughs) .

Jason Calacanis 6:44 And who's been the most MIA?

Antony Blinken 6:45 The most-

Jason Calacanis 6:46 Hey, Sacks.

Antony Blinken 6:47 The most unresponsive.

David Sacks 6:48 I've been the easiest to deal with.

Jason Calacanis 6:49 Yeah, that's why it's two votes.

David Sacks 6:51 I'm the easiest to deal with.

Jason Calacanis 6:51 That's why I get two votes.

Antony Blinken 6:52 (laughs) .

David Sacks 6:52 Chamath gets my proxy.

Jason Calacanis 6:53 Uh, yeah, exactly. I mean, it's- it's just wild, what's going on here. It really is Game of Thrones, and you have been put in the center of it, John. Congratulations. Welcome to the Iron Throne. Watch your back.

Antony Blinken 7:06 (laughs) .

Jason Calacanis 7:06 All right. Dismissed, John.

Antony Blinken 7:08 (laughs) .

Jason Calacanis 7:08 You will let us know, uh, how we can be helpful.

Antony Blinken 7:11 Thanks, John.

Jason Calacanis 7:11 Salute to you, John. Good luck.

Jon Haile 7:13 Thanks so much, guys.

Jason Calacanis 7:13 We got to get going here. We got a big show for you, everybody. Welcome to the show officially, David Sacks, your Rain Man, Chamath Palihapitiya, Chairman Dictator, Sultan of Science, David Freberg. I'm the world's greatest moderator. Welcome to the program. A quick correction up top that many of you in the crypto space let us know about immediately after the episode dropped. We talked about SBF getting 25 years, uh, and that broke right as we started the show, and we discussed that the customers of FTX were going to get made whole. There's been a lot of speculation about them being made whole. However, there was an important note. FTX deposits are getting paid back in US dollars, not their crypto. That dollar amount, we've learned, is based on the price of their tokens at the bankruptcy date. The bankruptcy date was November 11th in 2022. Super important because the report that started the run on FTX was published November 2nd. There's a couple of days in between those two dates, and a bunch of crypto plummeted. Solana dropped, uh, 50% between November 5th and November 11th, as just one example. But since then, Solana has been up 11X and Bitcoin is up 4X, Ethereum doubled. So if you're one of these depositors, you missed that run up. And so FTX customers were rightfully furious. I'll pause there before I get into more details. Any- any thoughts on this, Sacks?

David Sacks 8:41 Yeah, I mean, just to hit the nail on the head here, if you had left your Solana at FTX, you're going to get $16 per token back, and that apparently was the price at the time that they went under. So according to the- the judicial proceedings, you've been, quote-unquote, "made whole," but the truth is that Solana, at this moment, is trading at $188, so you have not been made whole, and this is why the crypto community is furious. And so that- that basically is the correction. Now, I thought it was interesting that the judge played into this notion, and we talked about that quote from the judge last week, where he said that if you go to Vegas, abscond with your customer's money, gamble it, and then pay them off with the winnings, then you've still committed a crime. He seemed to be conceding this idea that the investors or- or the depositors at FTX have been made whole. Clearly, they have not been, but his quote kind of lent credence to that. And the reason the judge was talking about it is because SBF's lawyers were clearly making this argument...

Jason Calacanis 9:45 Mm.

David Sacks 9:45 ... that his sentence should be commuted or reduced, because depositors had been made whole. And I think what you saw in the media coverage is that the reporters were buying into this idea of depositors being made whole. I mean, you guys got this from somewhere, right? I mean, this is what the media coverage.

Jason Calacanis 10:04 Yeah. Oh, absolutely. Yeah.

David Sacks 10:05 So the media- the media was doing what it's been doing throughout the FTX case, which is carrying water for SBF, and I believe that this narrative that they're trying to concoct, which we now know is completely false, is designed to serve a purpose. And I think that purpose is to get SBF either pardoned or have his sentence commuted, because Mr. Bankman and Ms. Fried are huge Democratic Party bundlers, and...

Jason Calacanis 10:30 (laughs) .

David Sacks 10:31 ... I think the goal here is to create the idea in the public's mind that people weren't really hurt by this. This was just sort of youthful indiscretion or- or hijinks. And, you know, it was a bunch of-

Jason Calacanis 10:44 (laughs) Hijinks.

David Sacks 10:45 Hijinks, right?

Jason Calacanis 10:45 Shenanigans.

David Sacks 10:45 And no one's... Shenanigans, but shenanigans where no one was really hurt. And if they can create that impression in the public's mind-

Jason Calacanis 10:51 Yep, pardon my-

David Sacks 10:52 ... they can now set up getting one of their Democratic Party connections-

Jason Calacanis 10:57 Yeah.

David Sacks 10:57 ... to help push for a commutation of the sentence. I think there's a narrative going on. I think there's an agenda behind the narrative, and it's-

Jason Calacanis 11:04 Interesting.

David Sacks 11:04 ... it's- what I'm saying here.

Jason Calacanis 11:06 Yeah, this pardon power is really powerful. Chamath, any- any thoughts here on the bankruptcy judge making that call to sell the shares? Because obviously, if crypto had tanked since that time, it would look like he saved them money by selling them, clearing the positions, and giving them cash. But what is the right thing for the bankruptcy judge to do here? Keep the equities, i.e., the tokens, or to sell it and freeze it in time? It seems like a very difficult call, right?

David Sacks 11:30 Well, hold on, Jake- Jacob, we gotta correct that for just in- in a certain way. So the trustee has been selling the tokens post-run-up.

Jason Calacanis 11:38 Okay.

David Sacks 11:39 The point is that he's selling tokens at current prices, call it 188, and then using that to pay off depositors at $16. So the only reason the depositors have been, quote-unquote, "made whole" is because they're getting the benefit of this run-up, but they're not paying them back at the price of their Solana today. They're paying them at this price that got fixed at the time of the bankruptcy.

Jason Calacanis 12:02 Which also-

David Sacks 12:02 So the truth is, this is why no one's getting made whole.

Jason Calacanis 12:06 Yeah, this is the, you know, the really hard thing to track here because we couldn't find when they were selling it or how much they've been selling. This seems to be being done in the shadows or in the background. And so if anybody out there as we crowdsource what's going on here wants to keep us, uh, up-to-date, let us know. But yeah, these tokens, some number of them got sold at a low price, some of them are getting sold, I guess, as time goes on. Chamath, your just thoughts on how to do this properly. What's the proper hygiene here? I mean, uh, it's- we're not bankruptcy experts.

Chamath Palihapitiya 12:37 That's a great... No, that's a great question. I don't know the differences between Chapter 7 and Chapter 11 bankruptcy law, but I don't know what was filed here. Was it Chapter 7 or Chapter 11? I don't, I don't know.

Jason Calacanis 12:49 Hmm.

Chamath Palihapitiya 12:50 But it seems that this was the only thing that they could do, which was to liquidate into a common, you know, unit of measure. Because at the end of the day, their auditors had to measure in a standard unit, and that was probably the US dollar. And so then they were trying to work backwards from that shareholder equity number to get them back-

Jason Calacanis 13:12 Hmm.

Chamath Palihapitiya 13:12 ... to that number. So-

Jason Calacanis 13:13 Yeah.

Chamath Palihapitiya 13:13 ... it was kind of logical that, that this was the only thing they could do. And I guess they benefited from the fact that there was a run-up, but it's really unfortunate for folks. So I don't know, maybe in other countries, had this been a, a differently constituted company organized in a different place, bankruptcy law could have allowed the liquidator to actually just distribute the assets on a pro rata basis.

Jason Calacanis 13:35 Hmm. This was a Chapter 11, by the way.

David Sacks 13:37 But I don't, I don't think that would've helped that much.

Jason Calacanis 13:38 And hold up, hold up. I got the update here. It, it, this is a Chapter 11, and in September, the judge allowed FTX to start liquidating up to 100 million a week in USD.

Chamath Palihapitiya 13:46 In Delaware, right? This is a Chapter 11 Delaware filing.

Jason Calacanis 13:50 Yeah, Chapter 11 in Delaware. Correct. And this could increase to 200 million a week. So it seems like they did, they did start the liquidation later.

David Sacks 13:57 Yes.

Jason Calacanis 13:57 So they might have caught some of the run-up. So if they did catch the run-up, then you could be doubly upset, right? (laughs)

Chamath Palihapitiya 14:01 No, my point, my point is-

David Sacks 14:02 That's the whole point.

Chamath Palihapitiya 14:02 ... in different-

Jason Calacanis 14:03 Yeah.

Chamath Palihapitiya 14:03 ... in different situations, one could imagine where the shareholders could have been allowed to vote.

Jason Calacanis 14:09 Hmm.

Chamath Palihapitiya 14:09 Do you want money or do you want in kind? And if in kind, maybe you get a pro rata distribution of all the assets which would have included a whole bunch of these coins, but then it probably would have included a bunch of other assets, not just Solana and Bitcoin and ETH that ripped.

Jason Calacanis 14:26 Hmm.

Chamath Palihapitiya 14:26 So...

David Sacks 14:26 I think the point is that if they had distributed in kind, meaning tokens, that people would have seen, "Oh wait, I only got back one-tenth the number of tokens that I put in." That's the point, right?

Jason Calacanis 14:37 Yeah.

David Sacks 14:37 You put in 100 Solana tokens, you only get back, call it roughly 10. Because the, the price of those tokens was fixed at 16 and they could now sell at somewhere between 100 and 200, they're able to "make you whole" at the $16 price, but that's not being made whole. That was the point of all the-

Jason Calacanis 14:53 And what are they doing with the extra money sacks? 'Cause are they using that to make other people in this whole crater whole as well? So maybe they're thinking holistically. They're taking the profits of those Solana holders, let's say, or Bitcoin holders who went 4X, and is that gonna trickle down to the equity holders? Who knows? Freberg, you have thoughts here?

David Friedberg 15:11 Yeah, I think the plan is that that excess capital beyond what is, quote, "owed" to the account holders goes to the equity holders because it's considered excess of the liabilities. Therefore, it goes to the shareholders. I'll, I'll also say, in a traditional, like, brokerage-

Jason Calacanis 15:27 Hmm.

David Friedberg 15:27 ... you create an account. And when you set up an account, your account has a currency denomination. It's a dollar-based account or a euro-based account. And then you, your account holds a bunch of assets. And so at any given time, the value of your account is represented to you in that local currency. The challenge with crypto exchanges is that there's often this representation of a wallet which is meant to hold assets that don't necessarily have the intention of being translated into a locally denominated currency. And so I think that's what makes the system different. In the case of a US exchange bankruptcy, and this happens in commodity trading accounts or commodity exchanges often, there's a freezing of the assets and then a liquidation of the assets where the freezing of the assets sets the, the price or the value at the moment of what you're supposed to hold in that account, in your currency of your account.

Jason Calacanis 16:18 Right.

David Friedberg 16:18 And so the, the bankruptcy judge and the trustee are treating this like a liquidation process using a local-

Jason Calacanis 16:25 Hmm.

David Friedberg 16:25 ... currency that was set at the time, whereas many folks don't consider that the intention of the account-

Jason Calacanis 16:31 Yeah.

David Friedberg 16:31 ... that the account was meant to hold assets, that it's really a portfolio of assets that shouldn't be liquidated to try and generate local currency 'cause that's kind of the whole point of many of these crypto-

Jason Calacanis 16:41 Hmm.

David Friedberg 16:41 ... currencies themselves.

David Sacks 16:43 It was a custodial account, basically.

David Friedberg 16:46 Right, a custodial account of assets versus a trading account of... which is meant to ultimately be converted back into a local currency, which is typical. And I think that's what makes this such a challenging process.

Jason Calacanis 17:00 Hmm. Yeah, just liquidate everything-

David Sacks 17:02 Right.

Jason Calacanis 17:02 ... pool of money arrives, distribute the money.

David Friedberg 17:04 Right, right.

David Sacks 17:04 Right.

David Friedberg 17:04 Based on, based on that 30...

Chamath Palihapitiya 17:06 The way bankruptcy works is that there's a pecking order-

Jason Calacanis 17:09 Hmm.

Chamath Palihapitiya 17:09 ... that essentially you, you have all the assets of the company. The job of the trustee is to liquidate them. They have a fiduciary duty to get the highest price they can for those assets. We have no reason to believe that they're, they haven't, 'cause they seem to have waited a decent enough amount of time to get to benefit from this crypto recovery. And then what happens is, again, there's like a pecking order for the distribution of the proceeds. And you're gonna have debt holders, they're gonna be senior to the equity holders. The depositors are gonna be high up there as well. Government agencies that are owed fines are gonna be high up there. There's gonna be a very specific pecking order in which the equity holders are last.

Jason Calacanis 17:44 If we wanna go into conspiracy corner and put our tinfoil hats on, you mentioned the IRS, the CFTC, right? These government agencies are owed, like, over $20 billion. If all this crypto profits, if they're higher in the stack, they would be going directly to the government and the government is handling the process here. So it, it doesn't look-

Chamath Palihapitiya 18:02 Right, right. But I don't, I don't think, I don't think it's-

Jason Calacanis 18:04 No.

Chamath Palihapitiya 18:04 ... that's driving it. I think that... I think bankruptcy rules are very specific and they're-

Jason Calacanis 18:09 Hmm.

Chamath Palihapitiya 18:09 ... completely designed around, again, assessing...

David Sacks 18:15 ... what the value of each claimant is at the time of bankruptcy, and then creating a pecking order for distribution. So I, I don't think there's any foul play here. I think that this is just the way that the cookie crumbles.

Jason Calacanis 18:28 Hmm.

David Sacks 18:28 But I think that it's simply wrong or misleading to say that the depositors were made whole. And I think the reason we thought that is because of these statements that were promulgated through the media, including the judge, to give people that impression.

Jason Calacanis 18:45 Hmm.

David Sacks 18:46 And I think it really just underscores that the media always has an agenda, and you gotta be so careful about imbibing their narratives because without knowing exactly what their agenda is, you can imbibe their bias.

Jason Calacanis 19:00 Yeah. My understanding of bankruptcy is like they, they, they can get a little bit creative and the bankruptcy judges can be a little creative in trying to holistically think about what's the best thing for the business and all the stakeholder shareholders. But anyway, we'll keep monitoring it. And like, um, we've said before, anytime we make a mistake, we're gonna talk about it right up front. Anytime there's an omission or breaking news happens, we're gonna fill you in. And, uh, that leads us to our second topic. Some more

Jason Calacanis 19:26 news broke about Truth Social. We had a nice spicy discussion about it last week. Since that time, shares of TMTG, or $DJT, have dropped 30% and, uh, the numbers for their revenue also confirmed it came out pretty ugly, four million in revenue, 58 million in losses. Float's only 30 million shares, but there are some follow-up stories here we'll get into. Trump is suing the two co-founders to reduce their combined 8.6 stake to zero. His argument, his co-founders set the company up improperly and mishandled the launch of Truth Social so they should forfeit their stock. These are both co-founders previously on The Apprentice. Trump owns 60% and he stands to receive an earn out of 36 million additional shares in the coming week, uh, worth almost 2 billion. So huge windfall for President Trump coming. In addition to that, Sachs, you're gonna love this. Russia, Russia, Russia. The Guardian is reporting TMTG raised $8 million in emergency funding that might have possibly come from a Russian-linked entity. The SPAC, uh, while it was on hold-

David Sacks 20:28 Ooh.

Jason Calacanis 20:29 ... was running outta cash.

David Sacks 20:30 Russia-linked entity?

Jason Calacanis 20:30 Yeah. Uh, and you can read this all about this in The Guardian. They tried to raise some money. They wound up raising eight million across two convertible notes from a bank called Paxium, located in the Caribbean, owned by a Russian who is reportedly the nephew of Alexander Smirnov, who used to work in Putin's executive office until 2017. Is this a joke? (laughs) No, I, I, I, I mean, I w- I wish it was a joke because I know I'm gonna get barbecued (laughs) for like, by the, by the Trump supporters in the comments, but it is crazy that the Russians are, uh, are now being- What is the Russian's name? Alexander Smirnov? Isn't that the name of a vodka? (laughs)

David Sacks 21:05 It kind of is. S-M-I-R-N-O-V. Smirnov? Maybe Smirnov. Trump doesn't even drink. I mean, maybe. Yeah. I don't know if Putin drinks or not. Anyway, uh- No, I said Trump doesn't drink.

Jason Calacanis 21:16 Putin doesn't drink either.

David Sacks 21:17 That was a joke. Oh no, Trump doesn't drink. That's true. Yeah. If report-

Jason Calacanis 21:21 Neither does Bush.

David Sacks 21:23 Oh really? Is that true?

Jason Calacanis 21:24 Yeah.

David Sacks 21:25 So anyway, important caveats to all this stuff. Uh, interesting story though. There's no indication that Trump or Trump media had any idea about the nature of these loans 'cause, uh, they were opaque and, uh, Trump media says it's propaganda and false narrative. Your thoughts on the Trump SPAC, Sachs, and the, and Russia? I know it's your favorite topic. Well, we're... It's gonna be a really long seven months if we're gonna bring up every one of these evidence-free stories of some sort of Russia connection to Trump. I mean-

Jason Calacanis 21:54 Yeah.

David Sacks 21:54 ... this article doesn't even make sense. Like you said, here's the giveaway. In the middle of the article, they say, The Guardian does, quote, "There is no indication that Trump or Trump media had any idea about the nature of the loans beyond that they were opaque, nor has the company or its executives been accused of wrongdoing." So then what are we talking about here? Uh, just, there's some guy with a Russian-sounding last name. I mean, literally that's the story. It doesn't even make sense. I don't understand how you can get a loan and not know who your counterparty is. So this whole thing just seems like it's part of the milieu of let's create any connections we can between Trump and Russia. And the giveaway on this was actually a New York Times story that just came out in the past week. It was called Russia Amps Up Online Campaign Against Ukraine Before US Elections. Now, the interesting thing about this story is that it was reporting allegations by Clint Watts, who has apparently been hired by Microsoft to run something-

Jason Calacanis 22:56 Hmm.

David Sacks 22:56 ... called the Threat Analysis Center, and his job basically is to find Russian interference in the election. Now, here's what I found interesting about this, is that Clint Watts, that, that name rang a bell for me, and it's because Clint Watts was involved in the Twitter files. So back in January of last year, Matt Taibbi broke this story in the Twitter files that Clint Watts was running the Hamilton 68 dashboard. He was basically behind that project. He's a former FBI agent. What was Hamilton 68? Hamilton 68 claimed that it was tracking 500 Russian accounts on social media who were engaged in manipulation of online discourse. Well, as it turns out, executives inside of Twitter knew who these accounts were, and they were just American accounts, some Canadian accounts. And in the words of Twitter executives, the whole Hamilton 68 dashboard was bulls- (beep) . That was their word. And nevertheless, this Hamilton 68 project that Clint Watts ran put out story after story for years about how the Russians were meddling in American political debates. And these stories, the Hamilton 68 claims became the basis for thousands, literally thousands...... of s- mainstream media stories claiming that Russia was interfering in American politics. It all turned out to be a total hoax, a total fraud. Now, the amazing thing to me is you would think after an expose like this, that it would at least be mentioned in the New York Times that the person they're quoting as saying that the Russians are meddling in our elections, has a previous history of setting up Russia hoaxes, and they don't even mention that despite the Tayeb story. Moreover, it's amazing to me that this Watts guy not only landed on his feet, he got a cushy job at Microsoft running their threats analysis center so that he could put out more of this threat analysis on how the Russians were meddling. I can't imagine a less qualified person to be describing Russia threats than somebody who was caught red-handed manufacturing bogus threats for years.

Jason Calacanis 25:12 Friedberg, your thoughts?

David Sacks 25:13 So in any event, Jason, I would just say that, you know, going back to the SBF story, the takeaway there is be careful what you're imbibing from the mainstream media because there's always an agenda. And until this story about Truth Social from The Guardian has a little bit more detail to it that makes sense to me, I'm just gonna put it in the category of more of the same.

Jason Calacanis 25:34 Yeah. And, you know, the- uh, as I've said on this program before, Russia's explicit strategy is to put their fingerprints on everything and cause chaos like they did with the Internet Research Agency and all the trolling (alarm sound) they were doing the last couple of elections. Friedberg, your thoughts on this? You concerned about the interference in the election?

David Friedberg 25:50 I'm not gonna-

Jason Calacanis 25:51 No? Too fast?

David Friedberg 25:52 ... say my thoughts on this. Yeah. This is- this is nothing I feel like I should be thoughtful about.

Jason Calacanis 25:56 Okay. Sounds good. All right, and then wrapping up, I had mentioned last episode about the insider trading charges in the company that was the SPAC before they purchased Truth Social and the free- two of the three men have been charged with insider trading, just pleaded guilty. So Michael and Gerald Schwachman made $23 million in illicit profits trading shares of DWAC before the merger was announced. They each pled guilty to one count of securities fraud and face three to five years. Neither was involved with Truth. This is the SPAC that came before Truth and... There it is, folks. So there's your update.

David Sacks 26:37 What's the relevance of this to being a top issue on The All-In Pod? I just think this is gonna be a really (alert sound) long seven- I think it's gonna be a really long seven months for us till the election if we're going to bring up every mainstream media story that seeks to create a connection between Trump and Russia.

Jason Calacanis 26:49 Oh, this one's not mainstream media. This is an SEC filing. Yeah. This d- this one has nothing to do with Russia. This is the insider trading one.

David Sacks 26:55 But you just said it has no connection to Truth Social, so why are we even talking about it?

Jason Calacanis 26:58 No, no. It's th- these are the people who traded the stock before Truth Social merged with it. This is the SPAC that Truth Social... And they traded when they found out that Trump was gonna be the SPAC that was merged with. So I'm just following up-

David Sacks 27:11 Okay.

Jason Calacanis 27:11 ... closing

Jason Calacanis 27:12 the loop on that. Breaking news, Google is reportedly considering making an offer to hire- acquire HubSpot, trading at $34 billion market cap. This just came out. Reported by Reuters, who cited anonymous sources. Shares up 7% on the news. If you don't know HubSpot, it's an awesome tool. We use it. A CRM that blends marketing, sales, customer service, and all that kind of good stuff. And so here's their quarterly revenue since IPO. They've been public for 10 years, as you pointed out in the group chat, uh, Friedberg, and this has just been slow and steady revenue, power of SaaS, I guess, and a great product. I'm not a shareholder. Here's the quarterly revenue growth on a year-over-year basis, a stock chart, yada yada. Chamath, I guess this is something we've been talking about here, which is M&A and M&A being pushed into the cold plunge and being frozen, and now we see something like this. What does- what do you take from this if it's, in fact, a true report?

Chamath Palihapitiya 28:03 I mean, I think it's a bit of an odd acquisition, and the reason is that it's become pretty clear for all of big tech that any acquisition that they do is going to be highly scrutinized. And so just from an EV, expected value perspective, if you're gonna try to acquire something and spend the next year beating your head against regulators, why not do it for something that's really valuable? And I would not characterize HubSpot as strategically valuable for Google. I think it's an important ecosystem player and it's probably better off as an independent company. So if I were Google, I'd be trying to buy something much more useful, like Perplexity or something.

Jason Calacanis 28:43 Hmm. Friedberg, your thoughts on this?

David Friedberg 28:45 First of all, it's super impressive. HubSpot's been public, they went public at about a billion dollar market cap 10 years ago and today they're trading at 34 billion, so organic... ...ly developed this business and they provide marketing automation software, so basically things like CRM tools, email marketing tools. So when you use advertising tools and you generate leads, those leads come in, what do you do with them? So let's say you're running a website that sells bicycles. People want information on bicycles. What do you do with those people after they get information on your website and how do you track them down and how do you sell them a bicycle? If you're a big enterprise software company and you start to get companies reaching out to you through your website, how do you then convert them? So you use CRM tools, customer relationship management tools. Salesforce is a- obviously a- a behemoth in this space, but HubSpot has this integrated marketing automation and CRM platform for taking leads and then converting those leads and selling products to them. So the sales team and the marketing team uses HubSpot software to operate and- and do their work and do it better. When I worked at Google in 2005, the main thing I worked on is how do we do a better job taking our advertisers and giving them more tools that they can then convert the leads that they're getting into customers? And so one of the first things I worked on in 2004, and then we closed the deal in 2005, was acquiring Urchin, which became Google Analytics, so that companies could better track...... how folks were converting on their website. After they spend marketing dollars on Google, how do you see where those people go on your website and what they're actually doing on the website, and ultimately make your website better so you can sell them more products and more software? And one of the, the things I worked on was CRM. So I had this conversation with the executive team, with Larry and Sergey and others at that time, and we talked about wh- should we buy a CRM company? And we actually had a conversation, they did, with Marc Benioff at the time, and we talked about is there a way to buy Salesforce? And Salesforce went public shortly before Google, and it was more richly valued than I think the appetite was at the time to make this leap to buying a CRM company. We actually spent quite a bit of time meeting with, and I personally spent time meeting with NetSuite, which ultimately got rolled in. I think it was, uh, Larry Ellison was the primary owner of NetSuite. We looked at a few other CRM companies, and this was always meant to be the next solution that you plug into the advertising platform at Google. You get all these leads from advertising, and how do you convert those leads and make them customers? And many of the other things we looked at were things like checkout software and software that would let you run a website to sell your products to customers on the website and so on.

Jason Calacanis 31:28 Which became Shopify, in a way.

David Friedberg 31:30 Which became Shopify.

Jason Calacanis 31:31 Yeah.

David Friedberg 31:31 And, and we had looked very deeply at doing this at Google, is actually building a product called Google Checkout. It wasn't very successful, but it was to do exactly this, which was to build a, basically a Shopify-type competitor. And so this has always been the natural fit for Google's business. Google made a quarter trillion dollars last year in advertising revenue. And then they didn't make much revenue after the advertising-generated leads because Google doesn't have a great commerce business and they don't have any of these other enterprise tools. So this is a very natural fit into Google's advertising business and taking all of the leads from advertising and better converting them and giving your sales team the tools they need to convert those leads into customers. So it makes great strategic sense. It's been a concept that's been around for 20 years at Google. Certainly, they're going to face regulatory scrutiny, but it doesn't have the same sort of overlap with the ad network businesses-

Jason Calacanis 32:25 Hm.

David Friedberg 32:25 ... because they're not very heavily in the ad network business at HubSpot, but it's a really good kind of enterprise software plug- plugin.

Chamath Palihapitiya 32:31 Some would say acquisitions are one of three types. They are defensive, they are offensive, or they are about reinforcing the status quo. If you had to bucket HubSpot into one of those three things, is this an offensive M&A, is it a defensive M&A, or is this status quo?

David Friedberg 32:49 I think it gives advertisers more tools that can integrate with AdWords, which is how advertisers spend ad dollars is through AdWords platform. And so as a result, it locks the advertisers onto Google's ad platform, keeps them more engaged.

Jason Calacanis 33:05 So that makes it defensive.

David Friedberg 33:07 And so I think that the benefit, to Tomas's point, is that they're going to both protect ad revenue at Google by locking in people on the, on the CRM side, and the marginal impact they'll get from selling CRM services, not that impactful to the business. I mean...

Chamath Palihapitiya 33:23 If you could spend, let's say with the premium, $50 billion on HubSpot or $5 billion on Perplexity today, which one would you buy?

David Friedberg 33:33 I think you've got to buy HubSpot. You're protecting, to your point, you're protecting a quarter trillion dollar ad business. HubSpot makes two billion in revenue. So it's 1% of the size of Google's ad business, and it helps you lock in some percentage of that 250 billion. So that's an important strategic acquisition, I think, for Google.

Chamath Palihapitiya 33:51 So you'd rather buy something in marketing automation in, versus AI?

David Friedberg 33:56 I think they should spend the money in AI, but I think you have to buy something to-

Jason Calacanis 34:00 Hm. That's a good question.

David Friedberg 34:01 ... to further the revenue model. Yeah.

David Sacks 34:03 What does Google accomplish here that they couldn't do with an integration?

David Friedberg 34:07 A partnership, you mean?

David Sacks 34:09 Well, I mean, uh, uh, they could just build on HubSpot's platform, just create a connector between Google Ads and HubSpot-

David Friedberg 34:15 Yeah, I think that exists already, actually.

David Sacks 34:16 Wh- ex- exactly. So what's the point?

David Friedberg 34:18 Yeah.

David Sacks 34:18 What do you- I don't really understand what they get.

Chamath Palihapitiya 34:19 Roach motel. R- what... I think what Friedberg is saying, in nicer language, is y- they're going to make it a roach motel.

Jason Calacanis 34:24 Lock in.

Chamath Palihapitiya 34:25 You get in and you can't get out.

Jason Calacanis 34:27 I mean, it gives you the full life cycle of the advertiser stack. So, I mean, you understand the funnel, right? You get the actual profile of the customer.

Chamath Palihapitiya 34:34 Yeah. The problem with the roach motel M&A strategy is that people sniff that out pretty quickly. Th- and then they start to carve out these very discrete parts of the product that they want you to divest in order to get the whole thing done. That's the thing that, surprisingly, I think the regulators have gotten smart about. And I suspect it's not that the regulators themselves know these discrete ideas, but that the answers are fed to them by competitors-

Jason Calacanis 34:57 Hm.

Chamath Palihapitiya 34:57 ... who want to just slow these processes down and make these things convoluted and complicated.

Jason Calacanis 35:02 Oh, they snitch? They send a snitch in? Yeah, 100%.

Chamath Palihapitiya 35:05 I, I think it's very smart for a competitor-

Jason Calacanis 35:07 Yeah. Yeah.

Chamath Palihapitiya 35:07 ... to actually call a regulator and give them a roadmap of how to make the deal happen, but in a very convoluted, complicated way.

Jason Calacanis 35:15 Hm.

Chamath Palihapitiya 35:16 You remember, I suspect, that's what happened in Microsoft Activision. Microsoft brilliantly fought it off, right? And so they were able to get the whole thing done completely on their terms. But in many other cases, you get these discrete things where it's like, okay, divest this, sell that, keep this, and it's like wh- why, why are we doing this?

Jason Calacanis 35:31 Hm.

Chamath Palihapitiya 35:32 But I just think the roach motel strategy is harder to get done these days, because folks will know how to make it super convoluted.

David Friedberg 35:40 I will tell you, when, when, when, when a big company like this makes a big acquisition offer like this, as much as I know Google's business, I think it's a generalization that can be drawn here, it's usually a negative signal about organic growth. Meaning if I'm a Google shareholder, I should look at this and I should say, "Why do you need to make this acquisition? Why... Is there an indication in this bid that there is some advertising revenue leakage going on?" And then I should go spend time trying to understand that.

Chamath Palihapitiya 36:11 Hm.

David Friedberg 36:12 I think there's a really important question there. Yeah.

Chamath Palihapitiya 36:15 But this is why I'm asking you, like, obviously they're not going to do this because things are going perfectly in that space, and so...... if you're losing share, you're not gonna be losing it to Bing, you're losing it to some form of AI, which is why I- again, it's a bit of a head-scratcher. Spend a lot less money and just buy everything in the space, or spend $50 billion and buy everything possible in the space.

Jason Calacanis 36:33 To give you, uh, just a little context here, this is gonna be by far their largest acquisition, if it's true, if it gets closed. This is all speculation right now. Looking back, Motorola Mobility, uh, was bought for 12.5 billion. There were patents. There was the hardware business, which they spun out. You can go look up the deal details there. But there's a long tail of, uh, companies they've bought, Nest Labs, Fitbit, and YouTube. Uh, $3 billion, $2 billion, $1.6 billion, if you remember. Uh, they bought, uh, Mandiant, I've never even heard of the cybersecurity company, $5.4 billion. They bought Nest for $3 billion, DoubleClick, $3 billion. That was a long time ago, so probably triple that value in today's dollars.

Chamath Palihapitiya 37:08 By the way, remember Fitbit? Fitbit took, uh, 18 or 24 months to close.

Jason Calacanis 37:14 Took a while, yeah.

David Friedberg 37:15 Dee- deeply scrutinized.

Chamath Palihapitiya 37:16 If you think a wearable on your wrist is gonna get scrutinized when bought by Google, imagine what happens when a $50 billion marketing automation company gets bought by Google.

Jason Calacanis 37:25 Yeah.

David Friedberg 37:25 Hm.

Jason Calacanis 37:25 It's really interesting.

David Sacks 37:26 Yeah. Look, I, I, I don't think this acquisition makes any sense. I'm kind of in Jamala's (ph) camp. This is, this would be a very odd acquisition. I'm not even sure if this story is true. There's been no confirmation of an actual bid made.

Chamath Palihapitiya 37:36 Mm-hmm.

David Sacks 37:36 This was basically an anonymous source saying that Google had hired investment bankers to, you know, maybe kick the tires.

Chamath Palihapitiya 37:43 Well, typically, these bankers float these problems like this because they wanna-

Jason Calacanis 37:47 Mm-hmm.

Chamath Palihapitiya 37:47 ... pump the deal. But-

David Sacks 37:48 Yeah, imagine what the fees would be on $50 billion acquisition. But yeah, like Jamala (ph) -

Jason Calacanis 37:53 And they wanna shake some of the buyers loose, yeah, when they have these auctions.

David Sacks 37:57 Well, look, uh, it's gonna be very hard for any big tech company to do a $50 billion acquisition of anything, just that, given that lean economy of the FTC are opposed to bigness in and of itself. But I think from a strategic point of view, I, I agree, this, this deal would be odd. I don't really see the connection to the Google Ads business. HubSpot is used by companies to manage their pipelines. It's a competitor to Salesforce. I see it all the time. I see startups using it all the time as the alternative to Salesforce because it's sort of easier to use, more user-friendly. And the main thing it does is you have your pipeline in there, you bring in the leads at the top of the funnel, and then you work them down to closed deals.

David Friedberg 38:36 Where do those leads come from, Sachs?

David Sacks 38:38 I understand-

Jason Calacanis 38:38 Mm-hmm.

David Sacks 38:38 ... that they can come from Google AdWords, but, but-

David Friedberg 38:41 Most of them come from, from ad spend. That's the connection. Mm-hmm. And it's always been this idea that those two should be integrated.

David Sacks 38:48 Okay, but, but the, the point is that if you think about your top of funnel, if you're one of the customers you- of HubSpot using this, Google AdWords is just one of a number of channels.

David Friedberg 38:58 Yes. That's right.

David Sacks 38:59 So you could be getting your leads through inbound. You could be getting your leads through-

David Friedberg 39:05 That's right.

David Sacks 39:05 ... events. You could be getting your leads through, I mean, there's so many different sources. So, so hold on-

David Friedberg 39:10 Let me give you another an- yeah, go ahead.

David Sacks 39:11 So it just doesn't make, it doesn't make sense to me that somehow Google would need to acquire a company to manage, not their advertisers, but the people their advertisers are trying to reach as one of a dozen different potential marketing channels. It just doesn't really make sense. I mean, the, the acquisitions where Google's been really successful have been broad horizontal platform plays like Android. This is as vertical as it gets. This is CRM software. This is basically Google getting into a vertical app for sales and marketing teams.

David Friedberg 39:44 Yeah. I have a CRM, yeah.

David Sacks 39:46 If, and if, if you think about, if you think about the business that this is most like, it would be G Suite and, because it, it's an enterprise play, and that's the most neglected part of Google's business.

Jason Calacanis 39:56 I think you're both missing a key piece to this. I think this is about the data. You look at these, these are the leads and the great contacts in the database of the customer, which Google doesn't have access to, and they can close the loop, and they can make targeting of ads and get people deeper, and they can fight for a larger percentage. So to your point, Sachs, yes, you've got 20 different inbound feeds coming in for leads. If Google knows the leads that are already in there, they can then retarget them across their entire ad network, which is the largest in the world. That's the value. If I know your 10,000 best customers and then I know when they're on Google searching and I know that when they're in a Chrome browser, I know when they're on an Android phone if they happen to use that, man, I can just start getting more of your ad dollars into it. That's what's actually happening here. It's, they don't want a SaaS business. They want the data, they wanna retarget folks, and then they wanna make, close more sales, and be more efficient than TikTok and Facebook and Meta. It's about the data.

David Sacks 40:51 So do you think they'll be allowed to use their customers' data to somehow target their ad product?

Jason Calacanis 40:56 Absolutely, 100%. If you, if I'm opting into it and I say, "Hey, you have 10,000 people in your database. You wanna go find them? We have, you have 8,000 of them connected that came in through Google Search. What about the other 12,000? You wanna try to find them in the Google Ad Network? We can put that together for you." That's actually, if somebody's gonna snitch (laughs) on this deal, it's about the data.

David Friedberg 41:14 I'll tell you, back in, just improving conversion rates drives more ad revenue.

Jason Calacanis 41:19 Bingo.

David Friedberg 41:20 Okay? And the key measurement we had the year after we bought Urchin and launched Google Analytics was we looked at how much an advertiser spent on Google's AdWords network before and after they installed Google Analytics. And that year, it was a ton of money at the time, we saw an incremental roughly $500 million in revenue in ad spend with folks who installed Google Analytics from before versus after, because they then started to change their websites and tweak their sales flow or their marketing flow on their website to better convert customers so they could spend more on the network, because higher conversion rates means you can spend a higher, uh, CPM on advertising. So the, the deeper you go from an integration perspective in closing sales, the better you actually can get and the more money you can spend on marketing on the front end, and so that benefits the growth in the network.

Jason Calacanis 42:11 And to build on your point, Freberg, this is why Amazon and Uber and Instacart have become such mayor, major players in advertising. They have the data on sales information-

David Friedberg 42:22 They sell conversions.

Jason Calacanis 42:22 ... pick up and drop off, and they sell conversions at the point, Sachs, of the shopping cart about to be clicked on.... and Amazon's been taking some of that and, and Instacart, but intercepting some of those ads. Yeah.

David Friedberg 42:35 I'll speculate on this for a second.

Jason Calacanis 42:36 Yeah, go ahead.

David Friedberg 42:36 I think that if I'm sitting inside of Google, I see the capability of our AI tools, our generative AI tools, in being able to improve marketing and sales-

Jason Calacanis 42:46 Hmm.

David Friedberg 42:46 ... um, processes, and I'm saying, "How do we leverage that?" Well, guess what? We don't actually have access to our advertiser sales and marketing automation workflow because we don't have a CRM tool.

Jason Calacanis 42:57 Hmm.

David Friedberg 42:57 So then the natural strategic thing is, how do we get a CRM tool? Okay, well, we can't buy Salesforce. Well, we could buy HubSpot. That makes sense.

Jason Calacanis 43:05 Yeah. Number two play.

David Friedberg 43:05 So then we could ap- we could apply our generative AI capabilities to improve conversion efficiency in HubSpot and probably grow revenue there as well, so it could be a fairly quickly accretive deal and there's the benefit to the ad network.

Chamath Palihapitiya 43:17 I think the roach motel idea is probably the best strategy here. Yeah, you're right. I just think I would, if I were them with $50 billion, their, what, like, the point is-

David Friedberg 43:25 Well, 30, 30 billion, by the way. 35 billion.

Chamath Palihapitiya 43:27 Yeah, but they'll have to take a premium.

David Friedberg 43:28 It's not the premium.

Jason Calacanis 43:28 They gotta pay 50% more, 25% more.

David Friedberg 43:30 It's already floated up, so you got to imagine it's probably a $40 billion deal. Yeah.

Chamath Palihapitiya 43:34 Okay, 40.

David Friedberg 43:34 Yeah.

Chamath Palihapitiya 43:35 Okay. So they save 10 billion.

David Sacks 43:36 I think the synergies here are negligible.

Chamath Palihapitiya 43:39 If it took Google almost two years to get a, an accelerometer on a wrist approved from antitrust, this is gonna take three years.

David Friedberg 43:46 Sacks.

Jason Calacanis 43:46 Yeah.

Chamath Palihapitiya 43:47 So why bother? So, like, do something much more disruptive.

Jason Calacanis 43:49 I have an answer to that, but I wanna hear Sacks's first. Go ahead.

David Sacks 43:52 Well, I just looked up how many customers HubSpot has. HubSpot has 205,000 customers as of the end of 2023. Now you look up Google AdWords. It has 1.2 million businesses, okay?

Chamath Palihapitiya 44:04 Hm.

David Sacks 44:04 And I'm sure that's not 100% overlapping. So-

David Friedberg 44:06 Every one of them should be using HubSpot. That's hugely accretive.

Jason Calacanis 44:09 I agree. Yeah.

David Sacks 44:11 I don't think that Google has the leverage to drive all of its AdWork customers into using a CRM product.

David Friedberg 44:16 It doesn't need all of them. If, if it gets 5% of them, it makes this deal make sense.

Jason Calacanis 44:20 Hm. Interesting.

David Sacks 44:22 That part is kinda interesting. If they can actually drive their ad customers-

David Friedberg 44:26 It's what they did with, with DoubleClick.

David Sacks 44:27 DoubleClick was actually advertising.

David Friedberg 44:29 No, but they had other, other places that they could take their AdWords advertisers to spend that the DoubleClick network had access to. Anyway, I, I hear you. Yeah, and there was another set of advertising auto- management tools that DoubleClick had that th- that's an enterprise software tool that they were able to sell into their advertisers that they didn't have themselves.

Jason Calacanis 44:45 Chemot, let me ask you a markets question here. If we wind up with a Republican, conservative GOP presidency and administration for the next four years, which seems like a, a possibility here, a strong possibility, what does that do for M&A markets? Do you think they might be opening up here? And the reason Google's even considering this is because they anticipate this deal might fall into a new administration that is gonna fire Lina Khan? Possibly, probably, almost certainly.

Chamath Palihapitiya 45:14 I, I actually think that, I think the Democrats and the Republicans are really well-aligned here. They don't like deals, and I don't think you're gonna see a big sea change. They hate big tech for different reasons, but they equally wanna slow them down. If you look at the non-big tech M&A deals, they're gonna get slowed down for different reasons. So, for example, like, the big US steel merger with Nippon Steel that was announced, Biden has one set of issues, but I suspect, you know, if Donald Trump were to get elected, his issues will be more about further hollowing out middle America. And so that deal will probably get stopped for different reasons. But, so I think that they're both actually-

Jason Calacanis 45:54 Hm.

Chamath Palihapitiya 45:55 ... roughly aligned in not allowing a lot of this big M&A to happen. So this is-

Jason Calacanis 45:59 But for different reasons.

Chamath Palihapitiya 46:01 For different reasons, but the outcome is the same. So, this is why I, I would just kinda think, like, if you're gonna do a deal, you gotta do something that's, like, small enough where it'll pass muster, you know it to be really valuable, and the regulators will be like, "Ah, whatever, just let it h- happen."

Jason Calacanis 46:17 Sacks, what do you think? You think a Trump administration would become more frisky and allow more M&A? They seem to be actually cozying up to tech in a major way.

David Sacks 46:25 Well, I, I agree with Chemot that there's a lot of anger on the Republican side towards big tech because of censorship and bias. And Google is as guilty of that as any of these big tech companies. So, I don't expect a Republican administration to have Google in its good graces. That being said, I do think Republicans have a more traditional definition of antitrust than Lina Khan does, and I think that a Republican antitrust enforcer would probably be guided by market share considerations first and foremost. And so in this case, since Google does not have a CRM play, then based on a traditional definition of antitrust, they would be able to make this acquisition. Whereas, I think, again, Lina Khan is just opposed to bigness and doesn't want big tech companies getting any bigger. So there's no guarantee that Republicans would allow it. I would say that if you got the right FTC commissioner or right DOJ, I'd say there's a possibility of it being more likely to go through.

Jason Calacanis 47:24 To remind everybody, Lina Khan's interpretation of antitrust is future competition, trying to protect future competition. The traditional one is consumer-based. "Hey, uh, are consumers benefiting or not?" And so, that's actually the, that's one of the top three yeses I wanna have, Freeberg.

David Sacks 47:41 Well, market share. Market share is really the traditional test.

Jason Calacanis 47:43 Yeah. Market share, and then the impact that has on consumer choice and price.

David Sacks 47:47 Yeah. Can I just-

Jason Calacanis 47:47 Yeah.

David Sacks 47:47 ... go back onto this synergy point? I just wanna, like-

Jason Calacanis 47:49 Yes, please.

David Sacks 47:50 I just want to brainstorm about this for a second. Let's say you're one of Google's 1.2 million businesses that are using AdWords. There's a high chance you're also using Facebook. There's a high chance you're also doing other kinds of advertising. You might be doing physical world advertising. You might be doing events. There might be a dozen different channels through which you get leads. Now all of a sudden, Google sends you an email saying, "Hey, we acquired HubSpot. You know, why don't you click here to use us for CRM?" Is that really gonna drive a change in behavior from that small business beyond what they would already do today? It doesn't seem that synergistic to me.

David Friedberg 48:27 Some percent of them. Not all. Maybe 5%. Again, that 5% is 50,000. That's a big growth.

David Sacks 48:32 It's an email campaign.I mean, I just don't see the leverage basically.

Jason Calacanis 48:38 Yeah, I don't know if I agree, but, I mean, that's why we're here.

David Sacks 48:41 (laughs)

Jason Calacanis 48:42 Mm-hmm.

David Sacks 48:43 If Google did a deep product integration where the leads that you acquired through Google AdWords magically appeared in HubSpot and that's where you went to go work them, then yes, maybe-

Jason Calacanis 48:56 Well-

David Sacks 48:56 ... maybe there'd be synergy.

Jason Calacanis 48:57 Just looking at this on the numbers, since we like to do back of the envelope here, 250 billion dollars ad revenue, 1.2 million in advertisers. It's almost exactly (laughs) like 200,000 per advertiser. Obviously, there's some big ones. Obviously, there's a long tail. Man, if you can get some number of those to spend 10, 20, 30% more, it could be quite accretive, uh, to the bottom line. It would pay for the acquisition over a short period of time, and we'll see. It's interesting discussion

Jason Calacanis 49:20 for sure. All right, if you missed it, Jon Stewart did a segment on AI on The Daily Show. He came back. He's doing, I think, Mondays every week, and it went viral, and it was about how AI is gonna change our jobs faster than any previous labor revolution. So it seems like the public is starting to get an idea, uh, about AI wiping out large swaths of jobs, and it's starting to hit the mainstream. CEOs like Brian Chesky from Airbnb and Levey from Box, I had them on This Week in Startups less- in the last year, they said they anticipate 30 to 50% productivity gains for a lot of the jobs in their companies, developers, customer support, all that stuff. And we covered Klarna's AI customer support agent doing the job of 700 full-time employees and driving a $40 million increase in profits this year, yada, yada, yada. We've, we've talked about this over and over again, but it seems to be tipping over into public consciousness. We, Chamath, have talked about whether humans will find more work to do or if this is gonna truly displace people. I think we all kind of feel like, at least to the best of my memory, we all feel like new jobs will be created, but it is entering the public's consciousness. What impact is that gonna have if the public starts thinking AI is gonna take their job, Chamath?

Chamath Palihapitiya 50:32 I mean, I think that social media will make this perception more widespread than it's been at other moments of revolution-

Jason Calacanis 50:39 Mm-hmm.

Chamath Palihapitiya 50:39 ... and innovation, but we've gone through this before. I'd like to summarize my thoughts in three charts.

Jason Calacanis 50:45 Okay.

Chamath Palihapitiya 50:46 And I call this, This Time It's Not Different. So chart number one for those (laughs) watching on YouTube is a look at the components of US GDP. This is from-

Jason Calacanis 50:56 Mm-hmm.

Chamath Palihapitiya 50:56 ... the Bureau of Economic Analysis. Now, this goes from 1929 up to 2011. So it doesn't go all the way back to the 1800s, and we're missing the last decade. But the point is the following, if you can see the chart, I'll, if you can't see it, I'll describe it to you, which is that GDP, the components of GDP are surprisingly resilient and roughly the same over long stretches of time, which is that even though GDP goes up, consumer consumption is always around 70%, net exports are a few percent plus or minus, gross domestic investment is around the 20% level, and then government consumption is around the 20% level, and that's what adds up to GDP. So that's an important thing to note. Why? Because in the absence of something very acute like World War II, these things don't change over long periods of time. Okay, so if that is true, what happens when you have any kind of a revolution? So let's look at the Industrial Revolution, so the shift from farms to factories. And what you saw was exactly what people should be worried about with respect to AI, which is in specific job classes, things just fall to zero. So unemployment basically went to zero, and the income associated with those jobs also went to zero. So this is what people are worried about.

Jason Calacanis 52:16 Hmm.

Chamath Palihapitiya 52:16 But if you remember the last chart, the point is somehow we found a way to find growth, and this is what's demonstrated on this final chart, which is when you look at US productivity and worker compensation, this is going from World War II to today, you find that every time we find a new way of innovating, compensation tends to track it.

Jason Calacanis 52:39 Hmm.

Chamath Palihapitiya 52:40 So if you take these three things together, number one, which is the components of GDP rarely change, number two is that, yes, there are certain categories of jobs that always get disrupted away, but the third is the most important, which is that as productivity goes up, which is what AI should give us, just as we've seen in the past, compensation also goes up, which means new job classes will be created. So I think the macro picture, if you look back hundreds of years, is that this is like many other moments in time. It feels more personal right now because we're all living it, right? None, few of us lived the agrarian to Industrial Revolution.

Jason Calacanis 53:16 Yeah. No, (laughs) we missed it.

Chamath Palihapitiya 53:17 And few of us lived the technological revolution, right? We kind of came in at the heels of it, but I suspect that this time is not different.

Jason Calacanis 53:25 Freeberg, your thoughts on this? I think you've said something similar on, on past episodes. But it is kinda tipping and into public consciousness, and it's also affecting white-collar jobs this time, not just people in fields picking berries. And so those people may be a little more vocal, and we've seen massive layoffs in tech, massive layoffs in media, and those jobs don't seem to be coming back. People seem to be get, taking the gains and just having people on the team be 30% more efficient, as Brian told me on my other pod. (laughs) So what do you think, Freeberg? Is this time different, or is it the same?

David Friedberg 54:02 So here's this article from June 2nd, 1983 in The New York Times all about how computers are eliminating jobs in industries that were effectively offline knowledge work industries at the time, creating engineering designs, creating architectural drawings. I think this article spoke to the fact that these jobs were going to be eliminated, and as we all know, those jobs actually got enhanced by computers, productivity went up, and new sub-industries emerged. And in fact, the overall industries actually grew in some cases when we were fearful of them being replaced due to the automation enabled by software. So-I think that in this particular sense, we can talk about the industrial revolution enabling through manufacturing systems and centralized production, uh, a replacement of manual labor with machines. What we're talking about now is the replacement of knowledge work that has been aided by computers with machines, so the machines no longer even need the human. But the reality is that these systems are actually gonna give humans 10 to 100X leverage. So, when you think about that, one person could spend three weeks making an architectural drawing today. What if that one person could make an architectural drawing every six hours?

Jason Calacanis 55:18 Hm.

David Friedberg 55:19 So, the question then is do- do we stop making architectural drawings and we fire a bunch of architects? Or does the cost of making an architectural drawing drop by 90% and it enables us to do more detailed, higher resolution architectural drawings across more places, more frequently, and the industry actually booms. And what we've seen historically is that when productivity goes up, costs go down, the actual volume balloons and the economy grows. So, it- it's a- it's an example where I think in this particular case, we will see these tools creating more leverage for knowledge work instead of just simply replacing knowledge work, and that humans will start to shift to a higher order of work and we'll see the economy grow and productivity go up, uh, as a result. So, uh, so I think that's my kind of key read on- on- on the story, but it's very hard to connect the dots for people without having all of these historical cases, and I think one of the ways to think about doing this usefully is you go back to the software revolution and all the stuff that we were doing with pencils and papers before computers. We actually didn't lose all those jobs. The people could now do 100 times or 1,000 or a million times as much work and new industries emerged and productivity went up and the economy grew. And so we just have to have this- this realization as this starts to take hold that the industries will change and that the systems will actually provide leverage, not replacement.

Jason Calacanis 56:45 Yeah, this is such a good point, and I think h- what you teach your kids is like really important at this moment in time. Like having a job that is replaced by AI or that could be greatly replaced by AI might be a mistake, and if you think about being a conductor, Friedberg, or a maestro, uh, conductor of an orchestra, I think that's the job of the future is can you work with these agents? Forget about co-pilots, 'cause that's phase one of all this-

David Friedberg 57:09 Oh.

Jason Calacanis 57:09 ... but agents are phase two where you have an agent who's writing copy, who's ch- the HubSpot example you gave before. You know, a designer who's in the cloud who's an agent, an AI agent making you artwork and then you stitch all these things together. I've been loading ChatGPT with my kids constantly, asking history questions and whatever questions they want. I've been teaching them how to use ChatGPT.

David Friedberg 57:31 That's great. Yeah, I mean, I think it's like a- like there's this whole transition of humans doing manual labor to doing knowledge work.

Jason Calacanis 57:38 Mm-hmm.

David Friedberg 57:39 Where you're using software to create digital output to now having more folks spend more of their time being conceptualists or creators where you can-

Jason Calacanis 57:47 Yes.

David Friedberg 57:47 ... kind of be an ar- architect or a creator of something and the system just generates it. You know, you- you state your intended objective and the system solves for it.

Jason Calacanis 57:56 Yes.

David Friedberg 57:56 As opposed to, hey, I gotta go build the Excel spreadsheet and check the formula in every cell and do all the manual.

Jason Calacanis 58:02 Yeah.

David Friedberg 58:02 What if I just say, "Hey, here's what I want the model to do. Please generate it for me," and you get the result? It enables you to do 100 times more work.

Jason Calacanis 58:09 Yeah, that's why I use the analogy conductor or-

David Friedberg 58:11 Yeah.

Jason Calacanis 58:12 ... yeah, orchestra leader. Sax, what do you think? This is- uh, you're- you're- you're on the populous side. You really have your finger on what Americans think. (laughs)

David Friedberg 58:20 And that is a compliment. It's a literal compliment. (laughs) But I do think you're- I think you've become a pop- es- especially as the longer I've known you, we've known each other for over 20 years, you've become more populous. So, what- what's the word on the street here amongst, you know, gen pop and when I think they're taking this news when they see somebody-

Jason Calacanis 58:38 Gen- gen pop. (laughs)

David Friedberg 58:38 ... like Jon Stewart they respect, when you see somebody like Jonathan- Jon Stewart, you know, doing this, th- that's like gonna hit a large swath of these, you know- you know, elites that we've talked about before on this show who are losing their jobs or maybe their salaries are getting capped.

David Sacks 58:53 Well, first of all, Jason, to quote Senator Gracchus from Gladiator-

Jason Calacanis 58:57 Hm.

David Sacks 58:57 ... I may not be a man of the people, but I do try-

Jason Calacanis 58:59 (laughs)

David Sacks 58:59 ... to be a man for the people.

Jason Calacanis 59:01 (laughs) Yes, exactly.

David Sacks 59:03 So, uh...

Jason Calacanis 59:03 Oh my God, did you see the AI? Did you see the AI from some Y Combinator company where they, like, made a little video of us and, like, we were talking about somebody's nuts and then they were like, you said, "Oh, I'm gonna ask my butler to ask my assistant, to ask my house manager, to then ask my chauffeur to pick those up." (laughs) It's like, it's a pretty great clip.

David Sacks 59:24 Yeah, it looked funny. Look, to be frank, no one cares what Jon Stewart thinks. He's never been less relevant and less funny.

Jason Calacanis 59:33 (laughs)

David Sacks 59:33 Um, this is a story that the media has been-

Jason Calacanis 59:36 (laughs) .

David Sacks 59:36 ... hyping up for months now. COVID's over, so they need something else to scare us with, and what they really should be talking is that we've got two wars, that risk spiraling out of control-

Jason Calacanis 59:46 And debt.

David Sacks 59:47 ... but they don't wanna go there.

Jason Calacanis 59:48 (laughs)

David Sacks 59:48 They don't wanna go there or- or the national debt. Exactly right, Friedberg.

Jason Calacanis 59:51 Yeah.

David Sacks 59:51 They don't wanna go there either-

Jason Calacanis 59:53 Or the border.

David Sacks 59:53 ... because neither of those issues reflect well on the current administration in power, so they're gonna scare us with this. Now look, in the short to medium term, AI leads to productivity gains. In the long term, it may lead to job losses, but as you guys pointed out, hopefully by then we'll have lots of other jobs created by the productivity boom that we're gonna get, and this has been the case throughout history with regard to technology improvements. And if we don't have these productivity improvements, what's gonna drive the growth in GDP? What's gonna allow us to pay off this enormous national debt that seems to be-

Jason Calacanis 1:00:25 Yep.

David Sacks 1:00:25 ... you know, so large that we, it's unrepayable? We need the productivity gains that AI is gonna unlock. Without them, we're definitely toast. So look, I- I don't pl- place a lot of stock in this Jon Stewart story. It's just one of many that the media is- is creating to try and scare us about AI.

Jason Calacanis 1:00:41 Uh, that's actually a great guest. Jon Stewart would be a great guest along with Lina Khan. Put those on the list.

Chamath Palihapitiya 1:00:46 Have you seen this, um, clip where Yann LeCun basically says...Our best LLM is 50 times smaller than what a four-year-old has processed since they've been born.

Guest (AI / neuroscience explainer) 1:00:55 A four-year-old is awake, has been awake a total of 16,000 hours. And you say, okay, 16,000 hours, multiply this by 3,600 seconds per hour, and then figure out like what's the, um, bandwidth of the optical nerve going to the-

Jason Calacanis 1:01:11 Yeah.

Guest (AI / neuroscience explainer) 1:01:11 ... cortical cortex. It's about 20 megabytes, right? You have one million nerve fibers per-

Jason Calacanis 1:01:15 Hmm.

Guest (AI / neuroscience explainer) 1:01:16 ... uh, per, per eye and it's about 10 bytes per second, right, give or take. Um, so multiply, that's 10 to the 15 bytes by the time you're four. 50 times more than whatever LLM, like the biggest-

Jason Calacanis 1:01:28 Mm-hmm.

Guest (AI / neuroscience explainer) 1:01:29 ... LLM in the world have been trained on, okay? So what that tells you is that in the space of a few months, a baby has seen more information than the biggest LLMs that we have.

Chamath Palihapitiya 1:01:39 The point is that, th- and this is one of the foremost experts in AI and really one of the fathers of modern AI, what he's basically saying is, it's still more artificial than intelligent. And everybody needs to take a deep breath and understand that there's just gonna be a lot more work before you get to this omnipresent agent that just replaces and destroys everything and thinks on its own.

Jason Calacanis 1:02:00 Yeah.

Chamath Palihapitiya 1:02:01 I'm willing to bet on all of us versus a bunch of four-year-olds.

Jason Calacanis 1:02:04 And I just wanna say kumbaya to Davos as well, (laughs) with a clip from Davos. Thanks for letting me choose that. Yeah, it's interesting, Sax, like, um, the number of jobs that will be replaced or augmented and then the creation of jobs, and then you start thinking about, well, how many jobs exist in the real world? I saw Waymo is doing Uber Eats deliveries, and you just think, wow, more people are gonna be able to afford Uber Eats. It's kind of expensive t- to use, so consumption is gonna go up. And then you think about the Optimus, and then what's the other robot company that's making a general human robot? Figure. Figure. Figure. Yeah. And man, those are starting to get really interesting, a- and I think that's gonna be the unlock. So maybe you could speak a little bit too, Sax. What do you think happens when we start getting humanoid robots in the mix, and do you have any investments in this space?

Guest (AI / neuroscience explainer) 1:02:52 (laughs)

David Sacks 1:02:52 I don't, 'cause I don't-

Jason Calacanis 1:02:53 Hmm.

David Sacks 1:02:53 ... I don't do that kind of hardware R&D. I mean, look, I think you're right that AI does lead to robotics, because one of the hard things about robotics is just having the- the robot not just move, but understand what's happening in the world around it and then make the right decisions about how to react to that. And so LLMs do start creating a path for the robot to be able to make intelligent decisions without having to be programmed with a bunch of if/then statements, right? And I mean, self-driving kinda does this too. I mean, self-driving is sort of the early, it's kind of like the early prototype for these kinds of robots. And that's why it's not a surprise that Tesla is developing Optimus, is because you think about what self-driving is. It's- it's a device, a car, with a whole bunch of cameras on it. It takes in all that visual information, and then it makes decisions about how to move and how to react.

Jason Calacanis 1:03:53 Hmm.

David Sacks 1:03:53 And then it's- it's trained based on mirroring human decisions. All those human decisions that Tesla's been able to gather through the combination of self-driving with humans intervening allows it to train the- the self-driving, I guess, brain, you could say.

Jason Calacanis 1:04:09 Well, and it's also, Sax, moving at two or three miles per hour, so it can take its time. And if you've- haven't seen this Figure, this combines the language model with what you're discussing, Sax. So the language models, when you show them a picture, and you say, "Hey," and this is from Figure, and there's a, this is a, their robot, and it says, "Hey, give me something to eat." Have you guys seen this before?

David Sacks 1:04:29 I've heard some of the- the founders of these robotics companies talk about why they create robots in a humanoid shape, and it's not just because they're trying to create a replacement for humans or something like that. It's also because now they can point cameras at the way that humans move.

Jason Calacanis 1:04:44 Yes.

David Sacks 1:04:45 And so they can actually train these robots on how humans move and react to things. So you're able to kinda create a large data set, kinda like with self-driving, so that the robots are able to learn how to- how to move. And I- I've seen a different video where, uh, Optimus, the Tesla robot, is folding shirts. Have you seen that one?

Jason Calacanis 1:05:03 Yeah, pretty impressive, yeah. What's- what's really interesting about this, Friedberg, is when I spoke to the- the people who are making these, evolution has made humans to operate in the world most efficiently over whatever number of years, and creatures before us. So in fact, the world is optimized for the human body type. And so maybe you could talk a little bit about what you think is gonna happen with these robots, Friedberg, in the- in the short and medium term. When will we have one of these robots in our houses? What will the price point be in five to ten years, and what will they be doing in five to ten years? Medium term. I don't know, we should explore, we should explore that question at the All In Summit 2024. Okay, shout out to Elon. Elon, can you bring Optimus to the event, please?

David Sacks 1:05:53 Jason, I don't think it's a five-year timeframe. I think it's longer than that. That's just my guess.

Jason Calacanis 1:05:57 Hmm.

David Sacks 1:05:57 And one of the reasons is, if you look at the use of robots in, call it industrial production today, they don't want humans getting too close to them. They're actually kinda dangerous, 'cause you have these arms flying around. They move quickly. They're very heavy. You get banged on the head by one of them, it's gonna take you out. So-

Jason Calacanis 1:06:15 It's a good point.

David Sacks 1:06:15 ... the idea of having a robot in your house that's capable of freely moving, you have to make that so safe to a point that they just haven't gotten to yet with robots. So there's just gonna be, like, a lot of fine-tuning work that happens before this is a domestic product. I think in the near term, it's all about industrial applications, or maybe even military applications.

Jason Calacanis 1:06:36 Well, it's, it, and if you've ever been to the- the gigafactories, I- I was (laughs) doing a little tour of one of them once, and somebody grabbed me 'cause I almost wandered into one of those areas, and they have tape on the floor, then they have a wall, et cetera. But if you even get within a certain...... closeness with this tape on the floor, it shuts the whole thing down because they're afraid somebody's going to get crushed behind one of these arms. Chamath, I'll, I'll give it to you. When will we have one of these robots in our homes for the price of a Prius? Now, oh, by the way, Prius is a car that costs about $50,000 that common folk drive. So $50,000 robot in our houses.

Chamath Palihapitiya 1:07:16 Uh, I think it'll be less than that. I think it's gonna be in the next two or three years-

Jason Calacanis 1:07:20 Hmm.

Chamath Palihapitiya 1:07:20 ... you'll have a domestic help robot that you can probably pay a thousand bucks a month for.

Jason Calacanis 1:07:25 Okay. Which would be-

David Sacks 1:07:26 Wow. Two to three years now.

Jason Calacanis 1:07:27 ... like a $100,000 car payment. Th- That would be the equivalent of a car payment on a $100,000 car. So, okay, you say under five, you say three. What do you think, Freeberg? Same bet. Thousand dollar a month robot, $100,000 sticker price. When will we have that in our homes?

Chamath Palihapitiya 1:07:41 No, no. I th- I think it's a thousand a month.

Jason Calacanis 1:07:43 A thousand a month, which would e- be the equivalent over whatever number of months.

David Friedberg 1:07:47 And what does it... It does... It's general-purpose? Does different stuff?

Jason Calacanis 1:07:50 General-purpose robot, thousand dollars a month, 50 payments.

Chamath Palihapitiya 1:07:53 I think it washes the dishes. I think it will do the laundry.

Jason Calacanis 1:07:57 Take out the trash.

Chamath Palihapitiya 1:07:58 There'll be, like, a whole set of house, household ta-tasks that it will do.

Jason Calacanis 1:08:02 Hmm. Walk the dog?

Chamath Palihapitiya 1:08:04 No.

Jason Calacanis 1:08:05 No. (laughs) Not if it's possible for a live creature. What do you say, Freeberg? Thousand dollar a month at-home robot, does your dishes. Th- That is a great bet for us. Give us the over-under. How many years, Freeberg?

David Friedberg 1:08:15 I'm not sure. I think we're, we're a long-

Jason Calacanis 1:08:17 You're the Sultan of Science. Come on, man. Give us a year.

David Friedberg 1:08:19 Well, I, I don't think it necessarily follows this general-purpose model. I think that there are likely gonna be more narrow application ranges.

Jason Calacanis 1:08:32 Hmm.

David Friedberg 1:08:32 And they're not gonna necessarily be humanoid in form factor. Um, I don't know if you guys have seen, uh, Gecko Robotics. Have you guys seen this company? Are you guys investors in this?

Jason Calacanis 1:08:43 Nope.

David Friedberg 1:08:44 Pretty impressive, like, suite of, um, autonomous products that do specific things in industrial settings. So they have, like, robots that climb on the outside of buildings and look for cracks using special scanning equipment. But they're very autonomous in how they operate and what they can do, and they've got a whole class of robots that can then be... Each one of those robots can do many different tasks for many different applications. And so the form factors, they've got, kind of, a set of form factors, meaning a set of robots that look differently and have different capabilities of them, like little spider legs or arms or, or whatever. And then they can be applied to go do something-

Jason Calacanis 1:09:28 Hmm.

David Friedberg 1:09:28 ... autonomously and then they just run and they do it.

Jason Calacanis 1:09:30 If you pull that up, you'll see it climbing walls, riding along pipes.

David Friedberg 1:09:34 So here... Yeah, they're purpose-built.

Jason Calacanis 1:09:34 Yeah, super interest-

David Friedberg 1:09:36 Well, they're not purpose... That's what's interesting. They're, they're sort of a narrow range of applications.

Jason Calacanis 1:09:42 Hmm.

David Friedberg 1:09:42 But they're not specific to do only one thing.

Jason Calacanis 1:09:45 Hmm.

David Friedberg 1:09:46 And so they can work in different environments and do different things. And so you'll, kind of, pick from their suite of robots which ones you wanna use to do different-

Jason Calacanis 1:09:54 Ah, got it.

David Friedberg 1:09:55 ... different tasks and then they go and do it. It's really interesting. They're mostly using them for industrial monitoring applications right now, like looking on bridges for breaks and, and checking timelines, reading the seams here.

Jason Calacanis 1:10:05 Yeah, like cleaning, cleaning, cleaning windows. Yeah.

David Friedberg 1:10:06 Cleaning windows, all that kind of stuff.

Jason Calacanis 1:10:07 Ooh, cleaning windows. That's a good one.

David Friedberg 1:10:08 Yeah. So they've got, like, a really cool suite and I think that's what we're likely to see in domestic settings as well.

Jason Calacanis 1:10:13 Hmm. All right, so you (overlapping speech) are now on. But Sax is taking the over three.

David Friedberg 1:10:17 I, I'm just, I'm just, I'm just not sure... By the way, I, I will say the success of Gecko indicates that there's far more money to be made in industrial applications than there is in consumer applications today.

Jason Calacanis 1:10:28 Hmm. I disagree.

David Friedberg 1:10:28 That's at least... Yeah.

Jason Calacanis 1:10:30 I think every human is gonna have one of these in s- I think every household in America, every middle class household in America will have one of these thousand dollar a month robots in seven years. I'll give it seven. You, you say three?

David Friedberg 1:10:41 To do what? To do everything?

Jason Calacanis 1:10:42 I say seven. I say they do domestic chores, taking out the trash-

David Friedberg 1:10:46 Like what?

Jason Calacanis 1:10:47 Folding laundry, domestic tasks.

David Friedberg 1:10:50 I just think it's hard to justify that because you're only spending so many hours a week doing that sort of stuff. Is it really worth a thousand bucks a month? Whereas in the industrial setting, it makes a lot more sense economically.

Jason Calacanis 1:10:59 Well, and think about those dangerous tasks, like climbing on a bridge-

David Friedberg 1:11:02 Right.

Jason Calacanis 1:11:02 ... looking at the seams and climbing on a, a building, cleaning the windows.

David Friedberg 1:11:06 Those tasks take years to do sometimes.

Jason Calacanis 1:11:09 Mm-hmm.

David Friedberg 1:11:09 Many, many years of high-risk human labor. Whereas taking out the trash and folding laundry might be a little bit more hard to justify

David Friedberg 1:11:17 the spend.

Jason Calacanis 1:11:17 All right, some more breaking news here during the program. We'll get our war correspondent, our geopolitical expert, David Sax. What are you seeing on the wires, Sax?

David Sacks 1:11:28 Well, there's a NATO meeting going on right now and Blinken did a press conference where he says that Ukraine will be joining NATO. That's the big news going viral right now.

Antony Blinken 1:11:38 Ukraine will become a member, uh, of NATO. Uh, our purpose at the summit is to help build a bridge to that membership, uh, and, uh, to create a clear pathway for, uh, for Ukraine, uh, moving forward.

NATO / EU official (Ukraine-NATO clip) 1:11:53 Uh, of course we believe that Ukraine deserves to be a member of NATO and that this should happen sooner rather sooner, sooner rather than later.

Jason Calacanis 1:12:02 Chamath, any thoughts on this flip that just broke during the program?

Chamath Palihapitiya 1:12:08 Well, we just... I think NATO just added Sweden, right? And it was done in pretty record time from application to admission. So I would like to know whether... Is this just rhetoric to just keep everybody at bay and placate the Ukrainians or is this real? The problem that this creates is that if it is real and they're admitted, then NATO has to defend Ukraine. Which means that then America and all the other NATO allies would have to fight, which means that we're in a war. America should not be in a war.

Jason Calacanis 1:12:46 Just, uh, give you the exact facts, you are correct. Sweden, Finland applied to join in May 2022, following Russia's invasion of Ukraine, and they had been neutral, as you know, for many decades. Finland-... has a massive land border with Russia, and they joined in April of 2023 after applying in May of '22, so just a year later. And Sweden became a member in March of 2024, just two years later. At first, membership was held up by both Turkey and Hungary. Sachs, you're our resident expert on Ukraine and all things geopolitical. Your thoughts?

David Sacks 1:13:20 On the one hand, what Blinken is saying is more of the same here, because it's been the administration's policy to s- seek to bring, uh, Ukraine into NATO since they took office. They've reiterated that over and over again, and it's one of the major reasons for this war, is that the Russians said over and over again this was a red line for them. That's why there's a war in Ukraine. The idea that you're gonna be able to bring Ukraine into NATO, however, when the war is going so badly is now entering the territory of being delusional. I mean, this is, like, a delusional comment. And if you just want to understand how badly things are going, look at yesterday's Politico, which was called, "Ukraine Is At Great Risk Of Its Front Lines Collapsing." The source for this article was high-ranking, uh, Ukrainian officials close to Zaluzhnyi, who's the former Commander-in-Chief. Some people have speculated that Zaluzhnyi himself might be the source. But at a minimum, it's high-ranking Ukrainian officers who reported to Zaluzhnyi. And what they say in this article is that the prognosis in Ukraine is grim. They say that the sad truth is that even if the funding bill is approved by the US Congress, a massive resupply may not be enough to prevent a major battlefield upset. They say that there is a great risk of the front lines collapsing wherever Russian generals decide to focus their offensive, which people expect in the next few months. And there's nothing that can help Ukraine now because there are no serious technologies able to compensate Ukraine for the large mass of troops Russia is likely to hurl at us. This is a quote from one of the Ukrainian officials. "We don't have those technologies, and the West doesn't have them as well in sufficient numbers." So, what they're saying is that even if the funding bill goes through, the 61 billion, it's not gonna be enough to save Ukraine. And at the very moment that that is now being finally, honestly reported by Western media, it's something I've been saying now for months, finally the truth is coming out, you have Blinken doubling and tripling down on these comments that nevertheless Ukraine will be joining NATO. And Chamath is right. Under Article 5, an attack on one is an attack on all. Therefore, if Ukraine becomes part of NATO, an attack on Ukraine by Russia, which is currently ongoing, will be considered an attack on the United States. Then you have to add to the mix the fact that Macron and other European leaders have actually been advocating for NATO to sending ground troops. And he's said this over and over again. He's doubled down on this multiple times. So, you have a dynamic now where this isn't just hot rhetoric by Blinken. This really has the risk of tipping over into policy, I would say in a Biden second term, where Biden agrees to do what our European allies are already calling for, which is send in NATO troops to Ukraine to save Ukraine from what Politico calls an imminent collapse. I think this is a very dangerous situation. I mean, what we're really talking about here is World War III. So, if you want to have a serious chance of World War III in the next four years, then I would say go ahead and vote for Biden in November. I mean, this is just very clear to me. I'm personally not willing to accept that risk. I'm not willing to accept a 10% or 1% risk of that chance. But I think Blinken putting it on the table here. I think people should be deeply concerned about this, and there should be a lot of follow-up questions for Blinken and the administration about this.

Jason Calacanis 1:16:45 Freeburg, should the free country of Ukraine be able to join NATO on some timeline, or should they be banned from ever joining NATO?

David Friedberg 1:16:56 Well, I think the statements are correct, that Ukraine joining NATO escalates conflict, and we will find ourselves in a de facto global conflict world war. Now, the question is, is that the- the cycle, the natural cycle? I will once again, Nick, pull it up please, reference Ray Dalio (laughs) and his-

Jason Calacanis 1:17:18 (laughs)

David Friedberg 1:17:19 ... typical big cycle behind empires