All-In PodcastE66: $FB's big drop, Rogan/Spotify mess, Xi/Putin meetup & supply chain issues with Ryan Petersen
EVERY SPOKEN WORD
150 min read · 30,005 words- 0:00 – 2:34
Sacks' shining moment
- JCJason Calacanis
The fact that Sachs' greatest moment in life was beating Peter Thiel in a multi-game chess. You ever see that picture of-
- CPChamath Palihapitiya
Yeah.
- JCJason Calacanis
... of him with his arms raised and Sachs can't believe he-
- DSDavid Sacks
That was pretty great. (laughs)
- JCJason Calacanis
... beat Pet- I mean, tell us about that moment.
- CPChamath Palihapitiya
Nick, show that picture of Sachs. I mean, listen. Here's what I say. When I saw-
- JCJason Calacanis
(laughs)
- CPChamath Palihapitiya
When I saw that picture, I had a couple thoughts. Number one, I've seen this picture somewhere else. And then number two is, oh my God, it was on NBC's To Catch a Predator.
- DFDavid Friedberg
(laughs)
- JCJason Calacanis
I mean, I have never seen Sachs happier. I- like, the birth of his children-
- CPChamath Palihapitiya
Oh my God. What a nerd.
- JCJason Calacanis
... pales in comparison to this moment.
- DSDavid Sacks
I'll tell you, that was the day of PayPal's IPO, and so we did a party in the... It was like a keg party in the parking lot. That was the extent of the celebration. And Peter-
- JCJason Calacanis
Wow.
- DSDavid Sacks
... did a 10-game-
- JCJason Calacanis
There's Roelof.
- DSDavid Sacks
Yeah, he did a 10-game simultaneous, which means he's playing against te- 10 people at the same time. And he goes board to board, makes his move, and I was the only one out of the 10 that beat him. And somebody... I guess I had put money down.
- JCJason Calacanis
Max Letchin on the left.
- DSDavid Sacks
I had put money down. I put, like, $20 down or something on the game, which is a foolish thing to do against Peter 'cause he's, like, a chess master. And, uh, and I, somehow I won, and you can see I've got the money in my hands, raised up.
- JCJason Calacanis
Look at the look on Peter Thiel's face.
- DSDavid Sacks
Oh, he hates losing.
- JCJason Calacanis
Look at the look on P- I mean, he's so angry. He, and he, but he's, he sees the joy in your face and he can't process it.
- DSDavid Sacks
And look at Max. Max is to my right, and Roelof is to my left.
- JCJason Calacanis
He, pure joy.
- DSDavid Sacks
And they're so happy. Yeah. 'Cause-
- JCJason Calacanis
Roelof, pu- pure joy.
- DSDavid Sacks
Yeah. But P- this was a few seconds before Peter smashed all the pieces off the board. And, uh-
- JCJason Calacanis
What?
- DSDavid Sacks
Yeah.
- JCJason Calacanis
He, t- he, he, you, he flipped the board?
- 2:34 – 45:49
Bestie Guestie Ryan Petersen joins to break down the supply chain situation: core issues, solutions, things to look out for
- JCJason Calacanis
everybody. Welcome to another episode of the All In podcast. With us again today, The Dictator, Chamath Palihapitiya, Rain Man, David Sachs, and The Sultan of Science, formerly known as the Queen of Quinoa, he's outta that business, David Friedberg. We got a lot on the agenda. However, one thing that we've had a hard time figuring out, uh, is the state of the supply chain. And it's confounding. It seems like nobody knows what the hell they're doing. But there's one guy who's been on Twitter, and, uh, we happen to know him. He's, he's been on my pod and, uh, Friedberg knows him, and his name is Ryan Petersen. And, uh, he's a bit of an expert on this. And we thought we'd have a bestie-guestie come on. We don't do this too often. Maybe this is the third or fourth bestie-guestie. And, um, welcome to the pod, Ryan Petersen from Flexport.
- RPRyan Petersen
What's up, guys? Thanks for having me on.
- JCJason Calacanis
What's up, Ryan?
- CPChamath Palihapitiya
Ryan, did you tell Olivia you were doing the show today?
- RPRyan Petersen
No, I didn't tell her, so she's gonna, she's gonna, she's a huge fan.
- JCJason Calacanis
Oh, don't tell her.
- CPChamath Palihapitiya
Where is she right now? Is she, like, not there?
- RPRyan Petersen
She was in the room next door, but I told her to leave me alone. I'm doing a podcast. She knows I'm doing a podcast. She doesn't know which one.
- JCJason Calacanis
That's awesome.
- CPChamath Palihapitiya
Fantastic. She's a super fan.
- RPRyan Petersen
She's a very big fan. She's literally wearing the Wet Your Beaks hoodie right now.
- CPChamath Palihapitiya
Awesome.
- JCJason Calacanis
Fantastic.
- RPRyan Petersen
By coincidence. She doesn't know I'm on the show. (laughs)
- JCJason Calacanis
Fantastic.
- CPChamath Palihapitiya
So wait, you're not gonna tell her, right? She's just gonna watch my next show and you're gonna be on it?
- RPRyan Petersen
She will listen to it, yeah. We'll probably listen to it together tonight, whenever it comes out.
- JCJason Calacanis
Ryan, what is the state now? Should we be worried about the supply chain? Is it getting better? Is it getting worse? What's 2022 gonna look like?
- RPRyan Petersen
Yeah, I mean, I think the supply chain means a lot of things, and it'll depend on what your industry is, what's really happening. But, you know, because it goes for everything from manufacturing products, which means sourcing all the sub-components, like semiconductors, through logistics and final delivery, all the way to a customer store. And we're, we're, Flexport focuses on that is sort of picking goods up from factories around the world and delivering them into fulfillment centers all over the world. So kind of that global mile, uh, is what we sometimes call it. There, you're seeing real disruption. Um, and, and it starts really with the pandemic shift in consumer behavior, where people started buying more goods 'cause they couldn't go to restaurants and travel and things. And so, a lot of spend shifted onto goods. And imports are up almost 20%, imported container volumes. So that's the start of it all. Uh, and then what we learned is our infrastructure is dilapidated and unable to handle a 20% increase. And by infrastructure, I mean the number of ships in the world, the capacity, uh, of throughput of the ports, the number of trucks and availability of trucks and chassis, which is the trailers that haul containers around. We just didn't have enough of these things or the port capacity. You know, like, look at, uh, American ports operate... This, I just learned this statistic pretty recently and I keep saying it 'cause it appalls me. Our ports operate with a lower throughput and productivity level than Mombasa, Kenya. Eh- you know, we just do not have modern port infrastructure. Rotterdam has been fully automated for 20 years, so if they wanna run 24/7 and keep containers flowing through the port, they can do that with self-driving trucks and everything.
- CPChamath Palihapitiya
Is that a technology issue or do you think that's a regulatory capture and union issue? Like a labor issue, like a labor...
- RPRyan Petersen
The tech is there, you know. It's existed for a long, long time.
- CPChamath Palihapitiya
Yeah.
- RPRyan Petersen
It's, it's really about labor getting together with management, negotiating these things and allowing it to happen. And the w- the way that our, our ports are run is, it's pretty crazy when you look at it. They treat labor as a fungible commodity, as in the, the p-... port terminal operators will say, "I need this many workers tomorrow," and the union provisions that many workers. But there's different people every day doing, operating complex, you know, heavy machinery that, uh, uh, you can't... Like, the number one thing in business is, like, what did we learn today and how are we gonna do better tomorrow every day with your team? But if it's a new team every day, like, that's not even possible. So I don't know how you can drive a productivity improvement when it's different workers every single day of the week.
- JCJason Calacanis
Right.
- DSDavid Sacks
So wait, they're not full-time employees? They're, like, staffed by the hour?
- RPRyan Petersen
They're union workers. They're paid by... They have annual contracts, but they-
- DSDavid Sacks
And the uni- the union decide who goes to work every day and who gets shifts?
- RPRyan Petersen
Yeah, and where. And so they'll show up at-
- DSDavid Sacks
Where, where-
- RPRyan Petersen
... different terminals, and there's, like, 15 different terminals. So they just kinda move around, do different jobs.
- 45:49 – 55:28
$FB's major pullback: causes, headwinds, and why going all-in on the Metaverse might have been a "frothy market mistake"
- JCJason Calacanis
Facebook stock has dropped over 25% after reporting negative user growth for the first time, and not only $10 billion or maybe even $12 billion lost a year on their, uh, AR/VR headsets and project, but also a $10 billion decrease in projected 2022 revenue thanks to Apple's privacy features. I guess we got to go to you first, Chamath.
- DSDavid Sacks
Also PayPal. PayPal dropped 25% too.
- JCJason Calacanis
Yeah, we got the Pay... We- we'll, we'll... And then Snapchat had a whipsaw back and forth. But Chamath, when you see this, uh, you called this with your spread trade. Maybe you could walk us through what you saw, you know, whatever it was, three, four, five months ago, and then what you're seeing now. And at this level, with $250 billion wiped off the market cap, what do you, what do you think about the future of this as a trade and as a company?
- CPChamath Palihapitiya
Well, I think the trade did what it was supposed to do, which is in a period of a lot of volatility, I saw an opportunity to, you know, just reduce my risk exposure. Look, I'm generally long very risky assets, right? I mean, a- all of us are in the business of building companies that have huge volatility because all of our companies generate earnings very far in the future. And so, you know, in November of last year, I was trying to figure out what I could do to shield myself. And the reason I wanted to shield myself was because I saw Elon and Jeff in part selling, but also I saw that clearly we were gonna go through a period where that high growth tech was gonna trade down, so I sold some of that high growth tech. But then I also wanted to figure out a way where I could be less exposed to some of that volatility by continuing to hold what I had. And the best way that I figured out how to do that was to do the spread trade. And so, you know, what I saw at the time was that there is one business above all others that I think is immune amongst big tech from any sort of real long-term issues, and that's Microsoft. And I think David expressed the reason well, is that it's an enterprise business now. You know, politicians generally don't tend to care about enterprise businesses. They have enormous longitudinal growth in front of them, and they're able to do things on the margins, specifically around M&A, to keep building their business with very little oversight. And we saw this because they had the courage to do this Activision deal, you know, just a few weeks ago. If you could imagine, again, no other company in big tech could even dare try to do a $70 billion acquisition because of the scrutiny. So Microsoft-
- JCJason Calacanis
In this climate, it was a bold move, yes, yeah.
- CPChamath Palihapitiya
I think it's not a bold move. I actually think it says the obvious, which is Microsoft is beyond the level of regulatory scrutiny that the rest of big tech actually has because they are consumer businesses.The second safest company is Google and the reason is that Google has the best of both worlds. They're both a platform because of Android, but then where they are at risk of being an app, they have an incredible deal with Apple that blunts that effect. And so when Apple talks about all their push to privacy, you still have this very specific relationship, and Facebook called it out in their earnings release, they said, "We believe that Google has preferential treatment relative to the rest of the internet in that Apple deal because they pay Apple 15 or $20 billion a year."
- JCJason Calacanis
And for people who don't know, that's for search. The default search on your iPhone-
- CPChamath Palihapitiya
Right.
- JCJason Calacanis
... goes to Google. Google pays $15 billion to Apple-
- CPChamath Palihapitiya
Right.
- JCJason Calacanis
... and the, uh, accusation... Explain the accusation-
- CPChamath Palihapitiya
M-
- JCJason Calacanis
... there of why that would give them preferential, in case people don't... can I say that.
- CPChamath Palihapitiya
Well, if you're paying somebody 15 or $20 billion a year, they're less likely to do bad things to you. They may do-
- JCJason Calacanis
Okay.
- CPChamath Palihapitiya
... bad things to other people, but they're not gonna do as many bad things to you.
- JCJason Calacanis
Did you believe that?
- CPChamath Palihapitiya
Yeah.
- JCJason Calacanis
That allegation from Zuck? Yeah.
- CPChamath Palihapitiya
Well, no, I don't believe the allegation, but I think that general th- uh, character-
- JCJason Calacanis
Got it.
- CPChamath Palihapitiya
... that general thing is true, like you're not-
- JCJason Calacanis
Sure.
- CPChamath Palihapitiya
... gonna screw over your partners. You're gonna screw over other people before you screw over your partners.
- JCJason Calacanis
Got it.
- CPChamath Palihapitiya
Whether this applies here, it'll have to be borne out in some kind of lawsuit or state AGs or blah, blah, blah. But anyways, the... I think the point is that every other company has a lot more headwinds than Microsoft and Google and big tech. And then the third thing is, was a market observation from Gavin Baker, which I thought was incredibly brilliant, and what he said was, when you see a drawdown, meaning when the markets go down, it'll affect high growth tech first. It ended up touching a bunch of other areas second, like biotech, but he said this key thing which is, "Big tech will be the last to crack, but when they do, they are gonna get shot." And so I h- spent a bunch of time just trying to figure out when big tech gets cracked, who's gonna get cracked the hardest. And, uh, I just kind of wanted to create a spread between those who were the most inoculated to those that were the most at risk. As it turned out, Netflix puked it up. Facebook puked it up. Amazon actually got really crushed even though this past day, they had a pretty decent rally because of their earnings, but they really got crushed. So in, in any event, the trade is what the trade is. The bigger thing is what is going on at Facebook, and I think what you see are three really important headwinds that Facebook called out explicitly. One is that when they talked about usage kind of flattening and starting to decay, what they're really talking about is TikTok, and I think what we learned is that TikTok is an enormous threat and a huge competitive force now in the consumer social app ecosystem. The second is that Facebook is fundamentally an app that sits inside of an ecosystem that is subject to the rules of the platform owner, and that's Apple and Google. And so this IDFA change, so the change in how you can track advertisers, Facebook said it's gonna have a $10 billion impact in 2022. And then the third thing, which was more implicit, is in order for them to grow, if you can't grow organically, the only other way to grow is inorganically, and unfortunately, as we're seeing, the regulatory focus on this company is really enormous. And so it was a, you know, it was a pretty, um, watershed moment in, I think, that company's, um, discussion of their future. And, and Mark actually kind of said that as much-
- JCJason Calacanis
Yeah.
- CPChamath Palihapitiya
... in the... in the pres- in the-
- JCJason Calacanis
Sacks, you look at this, uh, business, you made a, a interesting, uh, observation. Facebook rebranding itself as Meta before Meta exists i- may be looked at as another sort of sign that maybe they got a little tilted maybe, uh, uh... What was your take on the sort of sh- changing the name of the company before that business really is at scale or exists?
- DSDavid Sacks
Yeah, I mean, it's a bubble move, um, because, look, when you're in an up market and the market is super frothy, we had, in hindsight, last year was a giant asset bubble funded by all this liquidity coming out of the Fed and the federal government. So yeah, in a, a bubble like that, all investors care about is the growth story, and so Facebook went all in on this story around metaverse, but in the cold light of day, you know, once the... (laughs) once the punch bowl's been taken-
- 55:28 – 1:09:14
Breaking down the competition in the "XR Wars": Meta, Apple, Microsoft and Google; why a phone might have been a better $10B/year bet for Facebook, Google's strategic brilliance
- CPChamath Palihapitiya
things?"
- JCJason Calacanis
Okay, so Friedberg, I have a question for you about the future. Uh, obviously Facebook has bet the farm on Meta. They're betting on VR and, I, I guess, eventually AR, or what collectively is called XR. And then we have, uh, news that Apple has a seemingly brilliant goggles product coming out. Uh, developers are getting into it and they are the masters of hardware. So now, Zuckerberg has decided he will be on a collision course with the company that just took $10 billion in revenue from them by doing the non-tracking and that is the masters of hardware. So we have this collision course coming and then just two weeks ago, Google said, "Hey, by the way, remember that Google Glass thing? We're not giving up on VR/AR either." And of course, Microsoft, we all know, has their, uh, Hololens. So when we look at that four horse race, if you were to bet and rank who's gonna win, Apple, uh, Goggles, Google Glass, whatever they're gonna call the new thing, Hololens and, uh, Meta's Oculus, who's gonna win and what do you ... how do you look at that competition between the big four?
- DFDavid Friedberg
I don't know if that's a race you wanna be in. So-
- JCJason Calacanis
Okay, I like that answer.
- CPChamath Palihapitiya
(laughs)
- JCJason Calacanis
Race to nowhere. (laughs)
- DFDavid Friedberg
Have you guys used the Oculus Quest device?
- JCJason Calacanis
Absolutely. I have two of them. Try? Oh, my, and goodbye.
- DFDavid Friedberg
Have you played the games where you, like, move continuously through space and, like, when you do that, it's like you're gonna-
- JCJason Calacanis
You're gonna throw up? (laughs)
- DFDavid Friedberg
... you're gonna throw up. (laughs) Like, I mean, I'm not sure that this notion that that becomes the new computing modality is, like, a fair and true notion.
- JCJason Calacanis
Mm-hmm.
- DFDavid Friedberg
And so, you know, there may ... it, it may end up becoming kind of a, a niche entertainment device-
- JCJason Calacanis
Mm-hmm.
- DFDavid Friedberg
... almost like a Nintendo Switch, where there's a, a, you know, a, a mode when you're using it, but I'm not sure it replaces traditional, static, two-dimensional computing in front of you.
- JCJason Calacanis
Mm-hmm.
- DFDavid Friedberg
The jury's still out. I don't see, like, a computer sentiment that says these things will ultimately kind of prevail over the current, um, mode. So, you know, who's gonna-
- JCJason Calacanis
If it does work, who would win, in your mind? Who's got the best chance of winning? Let's assume we're all gonna use it every day for two hours as our desktop. We're gonna put it on, we're gonna find workout apps to use, whatever. It's gonna become ... Let's, let's assume, you know, that i-
- CPChamath Palihapitiya
Well, I think you just answered your own question. In, in, um, in all of these things, when you build hardware, I think you can take a lot of parallels from what happened in the PC space.
- DFDavid Friedberg
Mm-hmm.
- CPChamath Palihapitiya
Um, if you have, uh, commoditized PC manufacturers, Compaq, Dell, IBM, right, there are enumerable number, thousands of companies that made PCs, the value created to the application layer, to the operating system, and the people that can actually build ecosystems are typically the ones that win. And the people that already have an ecosystem and all, all they have to do is port somebody from, you know, platform A to platform B has a meaningful advantage over somebody that has to convince you to come to a new platform altogether. And so, you know, w- if you're a Microsoft and you have thousands or hundreds of thousands of developers, or if you're Google and you have hundreds of thousands of developers, or if you're Apple and you have millions of developers, it's just a smaller bridge to cross in order-
- DFDavid Friedberg
Mm-hmm.
- CPChamath Palihapitiya
... to convince them to now-
- DFDavid Friedberg
Yeah.
- CPChamath Palihapitiya
... build for one extra endpoint.
- DFDavid Friedberg
iOS versus Android, you know-
- JCJason Calacanis
Versus Microsoft.
- DFDavid Friedberg
Yeah.
- CPChamath Palihapitiya
And by the way, and Apple-
- DFDavid Friedberg
It seems like the obvious transition, whereas, like, Facebook is like, "You gotta go build all this stuff."
Episode duration: 1:38:56
Install uListen for AI-powered chat & search across the full episode — Get Full Transcript
Transcript of episode uSUM1mvw17w
Get more out of YouTube videos.
High quality summaries for YouTube videos. Accurate transcripts to search & find moments. Powered by ChatGPT & Claude AI.
Add to Chrome