🇺🇸 Veterans Day 🇺🇸, The Great Hobby Debate, AI is BACK! | Dan Goldenberg, Darren Farber, Walter Goodwin

Speaker 1: You're watching TBPN. Today is Wednesday, 11/11/2026. We are live from the TBPN UltraDome with Temple of Technology Losing. For office of finance

Speaker 2: We're losing our voices, folks.

Speaker 1: Of capital. It's a sick day today. We're both a little sick. A little into the weather.

Speaker 2: People in the comments yesterday The clock. The day before, they were accusing us of having a big night out. Oh. And unfortunately, no. No. Hate to disappoint. We are just sick, but the show must go on.

Speaker 1: Yeah. Last night, yesterday you called me or you texted me like, hey, you can free for a minute like 5PM. And I was like, I just woke up because I took a nap after the show. I'm, big into naps. Sleepy time is here. But not if you're running a business. You need to be saving time and money with ramp. Time is money, save both. Easy as corporate cards, bill pay, accounting, a whole lot more all in one place. We got a new sound board effect. Get ready. It's gonna be a big day. You wanna take us through the lineup today, Jordy? I'd love for you to walk us through who's coming on the show. Got... Very excited

Speaker 2: for this one. Is Veterans Day.

Speaker 1: It is

Speaker 2: Veterans Day. And in honor of all of our veterans, we wanted to have Dan Goldberg on who's a veteran himself, also the president of the Call of Duty Endowment. The Call of Duty Endowment helps veterans find jobs and has a number of other philanthropic endeavors. Very excited to talk with him. So we're excited to talk with him about what he's building. That's at twelve. Next up, we have Darren Farber from Albion River. He's a founder and managing partner who's investing in the defense industrial base and other components behind defense technology and the future of warfare. Stop stop laughing, John. Let me use this let me use this sound effect.

Speaker 1: It's a good sound effect.

Speaker 2: And then capping it off, have Walter Goodwin from Fragdoll. He's the founder and CEO raising a $720,000,000 series c co led by Thrive Capital, Founders Fund, Lightspeed, and Redpoint at a $7,000,000,000 valuation which we're very much looking forward to. Excited Thank you for keeping it together.

Speaker 1: Excited for it. Fantastic. Usually, I feel like that that sound effect is added in post but I think you might be the first person to ever do it live.

Speaker 2: We turned it into an instrument.

Speaker 1: Yeah. It is an instrument. Anyway...

Speaker 2: Should we talk about the the list?

Speaker 1: Yeah. There's an update. So first off, we got to get you up to date on how many days is it till Christmas? This is the question everyone's been asking us. They've been waiting hoping that we would chime in today. This is big

Speaker 3: part of why we're alive.

Speaker 1: If we weren't live today, you wouldn't know there's forty three days until Christmas and a Rubik's cube has 43 quintillion possible combinations. Interesting. Forty three days till Christmas. Road to Christmas is getting shorter and shorter. It's right around the corner. We're very excited. Darren Farber, I believe he's also on the board of Magpul, so we can ask him about top Christmas gifts from that company.

Speaker 2: What products should go in a stocking?

Speaker 1: Exactly. The tree. Resend Yeah. Exactly. Some furniture.

Speaker 2: Well, let's pull up pull up... I'm losing my voice. Insane.

Speaker 1: Let's pull up

Speaker 2: Let's pull up Santa's list.

Speaker 1: TBPN Santa's list. Of course, just to refresh, the marines made the Nice List yesterday. It was their two hundred and fifty first anniversary. On the naughty list, have Alice Wong and Jensen Wong. Of course, we've been following that story all week. But we have a new addition to the Nice List, Brian Chesky, founder, CEO, Airbnb. Why is he on the nice list? It's not just that he's running a nice company, not just that one he... He's one of the fittest men in the world, elite bodybuilder for years now. But he made a $100,000,000 donation to San Francisco Monday. We're gonna pull up a video to explain exactly what he did and give you some context because it's a really cool...

Speaker 4: I'm speechless. The $100,000,000 donation from the founder and CEO of Airbnb is the largest single donation the city of San Francisco has ever received and that money is gonna help the city's parks.

Speaker 5: We'll expand hours for parks. We're gonna increase programming access and long term support operations to make sure that these parks can be operated for years to come.

Speaker 1: You got a side effect? No? No. It it it's a it's a very very cool donation because it's just so practical. It's like something that people will will feel every day immediately. It's not like

Speaker 2: this... It

Speaker 1: will happen across the world. You don't know and it's all theoretical. It's like, no. You'll you see that park right there? You can go to it now. You can go to it tomorrow. I'm gonna help continue it and it's already there.

Speaker 2: There's been so much criticism of tech wealth

Speaker 3: Yeah.

Speaker 2: And its lack of, seeming lack of, gifts like this. Yeah. It's very popular to donate to non profits that push, you know, sort of like, you know, fear things things like that. Are

Speaker 1: you talking about the subway ads?

Speaker 2: Yeah. We'll we'll get to that. We'll get to the subway ads. But that feels in doesn't exact exactly make people feel warm and fuzzy.

Speaker 1: Yeah. Right? No. This is this is pure nice list.

Speaker 2: Crazy that the opportunity was just sitting there to do something like this. Yeah. And and now I I imagine it will spark other donations like it. Yeah. But the fact that you can't... It's it's hard for me to think about, you know, and and of course many of these type of donations are are made anonymously. Yeah. But good timing from Chesky to do something like this.

Speaker 1: Yeah. Yeah. It's like it's it's practical. It's in the real world. But it's also not like donating to an opera or a symphony, which I like and enjoy. But it's less Weird for than average person in the in the city. Like the the parks can be enjoyed by just everyone. You don't have to have a particular taste in classical music to enjoy it. Anyway, what else made the nice list? You want to take us through the third edition to the TBPN nice list this Christmas?

Speaker 2: Oh, yeah. I mean, just obviously quick scoping setups

Speaker 1: On caught.

Speaker 2: Sort of been permanently on the nice list.

Speaker 1: Okay. So it's just returning

Speaker 2: to the nice list. Yeah. Since I'm...

Speaker 1: Since they were introduced. Yeah. Yeah. The intervention, of course. There's a new statement from the independent board of member... The independent members of NVIDIA's board. The Jensen story continues to evolve. It's on the cover of the Wall Street Journal again next to Hague South. NVIDIA's CEO affair NVIDIA's CEO's affair became national security nightmare. I don't know how much more there is to talk about this. The the the latest scoop from Axios is that commerce secretary Howard Letnick was sent a highly classified memo warning about Nvidia Jensen Wong's... Nvidia CEO Jensen Wong's relationship with suspected Chinese spy Alice Wong. Letnick oversees the agency charged with keeping sensitive US technology out of the hands of American adversaries. The warning raises questions about how the department weighed political potentially... Security risks as it cleared advanced NVIDIA chips sales to China affiliated entities. And it's... I it feels like we're getting closer to understanding the role that Alice Wong was playing. I think we might be taking her out of the James Bond bucket soon. And it much... It would be much more like, considered an asset versus an agent. So an asset in the sense that she was actually running a business, was actually connected, and then contacted by the intelligence community in China to funnel information, do spying things, lower risk operations, not day one training. But this is all speculation still, but we'll see. But they are two different they are two different things.

Speaker 2: Yeah. Sort of a technicality, Unclear how much like it's less interesting of a story. Yeah. But the net effect I think is like pretty much the same.

Speaker 1: Yeah. But there are some absolute banger memes that are coming out of it. Ironically, using probably Nvidia GPUs to create them. Absolute banger Jensen can connect a 100,000 GPUs but forget.

Speaker 2: Absolutely crazy. Yeah. Really really weird to see all these around, basically like Jensen's own creation. Yeah. You know?

Speaker 1: It does feel like it's it's broken containment. Maybe it's just my Instagram algorithm, but I felt like I saw a lot of content creators that don't really talk about the nitty gritty of tech or maybe talk about tech at a very high level. They might... This might be the first time they ever mentioned Nvidia. They might have talked about a viral Dario clip or a Sam clip or Elon occasionally, but that's not their wheelhouse. But everyone is is is giving their take or or having a laugh about this on on social media. It's going very very broad. Still remains to be seen if it's if it's as broad as the Lewinsky scandal. That was like more even even more global of a story, but this is this is big. So Senate Banking Republican has called on NVIDIA's CEO to resign. Where... Tyler, can we pull up the prediction markets and see where the latest sits there? But a senior Republican member of the Senate Banking Committee is calling for Jensen Huang to step down as CEO of NVIDIA following the disclosure that he had an extramarital affair with an alleged Chinese spy. North Dakota senator Kevin Kramer said Huang's actions as head of the world's largest AI chip company pose a clear national security risk. The potential for extortion is so tremendous that something as sensitive as NVIDIA chips, I just think he's got to go. Of course, there's a lot of discussion over what would be... Who would step in. It's it's a very confusing there's not a clear successor in line and Jensen was planning on running the company for a really long time. Where's the polyamerican at or the culture?

Speaker 6: Yeah. It hasn't really changed

Speaker 1: Okay.

Speaker 6: Since yesterday. So the chance that he leaves before July of next year is still at 38%.

Speaker 7: Does he see what it was?

Speaker 1: Yeah. Mean, he is he is firmly in the camp of like business as usual not leaving. So CNBC is reporting that CEO Jensen Huang

Speaker 2: I feel like

Speaker 1: walked into NVIDIA Santa Clara California headquarters on Monday and conducted his regular morning meeting with top level executives. He had disclosed it. He kicked it off by addressing the infidelity, saying that he was sorry, didn't take any questions, and moved and pivoted to business and top agenda items of the day. So, Jordy.

Speaker 2: I was... I I I was gonna ask about, the technicalities around the prediction market because sometimes these things can, like, get a... Mhmm. Like, it's more interesting, like, is Jensen still chairman in in some ways, like Yeah. By next summer. Right? It's not just about the CEO title because there's a lot of, like, different... There's a lot of potential outcomes here

Speaker 1: Yep.

Speaker 2: Where he's, you know, fully just becomes, you know, shareholder Yeah. Right? And and continues in that way. But...

Speaker 6: Yeah. So it requires him to actually fully leave, not just like announce that he's leaving.

Speaker 1: Okay.

Speaker 6: But I I think if he stay... If he becomes chairman of something and fully leaves CEO position, then it counts.

Speaker 1: Yeah. Obviously, a very different situation, but Elon Musk has held different different roles at SpaceX and Tesla. Chief executive officer of Tesla, techno king is technically one of his titles. Techno king of Tesla and he's also board director. And then at SpaceX, he's the founder. He's not the founder of Tesla. He's the CEO and the CTO of SpaceX. And I and I feel like there was another title that he held at one point. But he officially adopted the title of techno king of Tesla on 03/15/2021 while retaining his CEO position. And I remember there was a there was a moment in the shareholder lawsuit, the whole funding secured saga, where there was a question about whether or not he'd to step into a different role. But that would be sort of immaterial because, of course, all the... He wasn't going to have to sell down the position or change any of the voting structure or leave the board or do anything. But there might have been a... There... At one point, there was discussion of a ruling that would put him in a different seat. But, of course, he already has the the techno king role. So I think he'd be I think he'd be quite fine with that. So maybe maybe the maybe the outcome would be Jensen becomes techno king of of NVIDIA and the prediction markets resolve positively that he did in fact step down but it's not what you think it is. So always always new... Always nuance there. Also, people are are are really grave dancing here talking about the death of the CUDA mode. Anthropic sees all compute as fungible and it only took mythos three days to figure out how to run itself on AMD hardware compared to six to twelve months. When we talked to Lisa Su at AMD a couple months ago over the summer, this was the big story of the day was that the bring up time had been significantly reduced from these AI speed ups, which is interesting because it's such a crazy multiplier going from six to twelve months to three days. That's like a a that's a 10 x increase. No, more like a 30 x, 50 x, 100 x increase in in in speed. And yet there's still a lot of debate over whether Anthropic seeing a two x increase in in AI development and there's some debate in the latest model card and

Speaker 2: the latest... Yeah. The timing of the of the of the the Jensen spy crisis

Speaker 1: Yeah.

Speaker 2: And the Anthropic IPO is is just really wild. Obviously Anthropic is ascendant. Yeah. Their views are very much at odds with Nvidia's. Mhmm. Right? They have drastically different world views. They they view... I would say that they obviously play nice, but they view the technology in a completely different way.

Speaker 1: 100%.

Speaker 2: And their frenemies might even be like too friendly.

Speaker 1: Yeah.

Speaker 2: Right? Because if you can imagine like what Anthropic executives would say behind closed doors about about, NVIDIA and their actions over the last few years. Right? They could simultaneously, you know, agree that like they make, you know, pretty good GPUs.

Speaker 1: Yeah.

Speaker 2: And, but they strongly strongly disagree with with the approach that, NVIDIA's taken to, you know, exporting the technology. 100%. And so, I very much... Yeah. They... Of course, they're gonna be taking, you know, one, think this is like pretty much real. This this like, I think going back to, as as you started to understand the implications of how quickly we would be able to generate software Mhmm. You had to be bearish on CUDA. Right? Two things were completely at odds. And one of these things that's interesting where like Nvidia is like helping create its own, helping disrupt itself Yeah. In the same way that you saw with Google creating Reddit. You know, like the original

Speaker 1: Yeah.

Speaker 2: LLM. Also like creating the technology to to ultimately disrupt itself.

Speaker 1: Yeah.

Speaker 2: And so I would just see, you know, Dario will be out there continuing to push, you know, Anthropic's world view Mhmm. At a time when Jensen is like greatly weakened. Right? Yeah. And his ability to fight for his view is is just so diminished. Yeah. And so... So yeah.

Speaker 1: At the same time, it feels like all of that is true behind the scenes probably in Washington right now especially with the realignment post midterms. But that was not the focus of the of the IPO roadshow. The IPO roadshow was not focused on doom and fear mongering. It was very focused on the age of miracles, curing cancer, the more optimistic side. And it also wasn't particularly focused on geopolitical considerations even though you could imagine that driving the marginal investor. But it's a little too... It's it's it's it's too crazy, maybe too scary, maybe too complicated to lay that out in an IPO roadshow. So focus on the impact of the technology, the adoption, the revenue, the the margins, etcetera.

Speaker 2: Well, should we talk about the subway ads? Yes. That Of course. Our friend of the show, Jeremy Gaffan spotted

Speaker 1: Yeah.

Speaker 2: I believe this morning. Let's pull it up.

Speaker 1: You got it. This is paid for by Miri, I think. Right? They're running full on... But do they have TVs in the subway now? I'm I'm confused about how this is a subway ad. When I think subway ad I usually think like printed poster but it's it's a it looks like a ring camera with three humans hugging and then they just disappear. X's appearing. X's go over them and then they just get... It has the aesthetics of a like a low budget horror film. Maybe this should be adapted to the next Terminator film or something. But it says like... Yeah.

Speaker 2: And so if you go to the website that they're promoting it's donotaccept.ai. Okay. And it says AI companies are deciding our future. Here's what they've signed you up for. Mhmm. You accept that our AIs are already escaping our control. You accept that we don't understand how they work. You accept that we keep breaking our commitments to making AI safe. You accept that this will very likely kill everyone. You accept that we can't stop because someone else might build it first. And then, you know, they're they're basically trying to get people to sign a petition. And a bunch of people that, you know, of course have, you know, backed, as Jeremy calls out, backed anthropic. You have Open Open Philanthropy, Dustin Moskowitz Yeah. John Tollin, the Thiel Foundation, EA Funds, Long Term Future Fund, and a bunch of others. But it's fascinating.

Speaker 1: So what I'm confused by by about this is that why haven't they brought a shareholder lawsuit against the Anthropic? If you are if you are a shareholder and you believe that this AI will destroy humanity, will certainly destroy shareholder value. Right? So the stock will go to zero in an extinction scenario. I would think it's pretty easy to argue that in the court of law. And so in the Matt Levine framework, it's securities fraud essentially. Like you you you have a you have a fiduciary duty to maximize shareholder return and you are violating that by building something that will destroy humanity. And I I'm not saying that that would be easy to argue in a court of law but it would certainly preference to be... And it would be a big moment for the safety camp to actually say, hey, we're we're we're gonna take this to the court and Yeah. Try and and try and implement a a financial consequence to this because we feel like it's a violation of our of our shareholder rights. Yeah. But but I I I I don't know. May may maybe it's coming at some point, but it does seem like a lever that you could potentially pull as a shareholder, especially a big shareholder in a company that you think is going to kill you. I mean, there's like... There's shareholder lawsuits around like CPG companies about, oh, this this this yogurt company isn't taking, you know, food contamination seriously enough. People have gone to jail for that. There there there's a whole bunch of different ways, you know, if if an airline is is not servicing the engines reliably, shareholders can absolutely sue. So I don't know.

Speaker 6: Does it matter that, like, the the bad thing hasn't actually happened yet?

Speaker 7: Like, in in No. Totally.

Speaker 6: Like the yogurt example, like, can you only do that once someone has gotten sick?

Speaker 1: No. Not at all. Because you could just say the current the current structure, the current safety infrastructure at this company is negligent and that will result in crisis, that will result in diminished shareholder value and therefore, we will... We we are taking actions now. Because what what you have created is is is dangerous and is putting our future cash flows at risk. Because what will the cash flows be if humanity is extinct?

Speaker 6: But isn't this the same Actually, it's clear.

Speaker 7: In a

Speaker 6: saying like, oh, why aren't you short, you know, AI?

Speaker 1: No. No. So so I I I agree. This is not this is not a transposition of that argument. What what I'm saying is that is that if if you are a if you are a shareholder in an AI company who's anti AI, you can use that money to run an advertising campaign to build a website to get a whole bunch of people sign things. You can also file a lawsuit, hire a law firm and then you get a headline that's like, hey, there's a lawsuit about this. There's a it's a shareholder issue. How will they deal with this? There might be discovery. There might be a testimony. There might be... People might be deposed for this because everything is... Everything still needs to flow through. Not exactly the question of existential risk but it's a proxy for existential risk because it's it's it's in the interest of shareholders. And so you could still force a lot of the conversations that you want to happen which is what all this is about. Why why do you buy, you know, advertising? It's because you want to raise And a share and a shareholder lawsuit is another way to raise awareness about your concerns. Now, I I as a as a I I if I was in in this position I would not be suing. I don't think it's an issue. But...

Speaker 2: Yeah.

Speaker 1: It is a viable path.

Speaker 2: It feels like the plot of a science fiction novel, right? And that you have a company creating a technology that's gonna IPO very shortly and some of the largest beneficiaries of said IPO Mhmm. Are funding, know, effectively political organizations that are that that seemingly are taking a stance against said company. It's it's like...

Speaker 1: People have kind of...

Speaker 2: It is crazy to be putting out this AI companies are deciding our future. Here's what they signed you up for. You accept that this will very likely kill everyone. It's like...

Speaker 1: It's a big jump.

Speaker 2: Very likely is not even what Dario has said. Right? Or like that that's not even like the party line

Speaker 1: on Yeah.

Speaker 2: You know, 10% I don't think as you know, very likely.

Speaker 1: Yeah. Yeah. Yeah. You would not say that. Where does... Very... Is very likely over 50%? Where would you where would you put?

Speaker 2: Like you almost need to be over 60%.

Speaker 1: I'm very likely to hang out with you this weekend. 10%.

Speaker 2: Yeah. Don't think you'd be a good friend if you were doing that.

Speaker 1: I was like, I am very likely to make it to your birthday party. 10%. Yeah. I don't think so. But yeah, I mean people are like for a long time people have been like, oh, all the fear mongering is like a marketing scheme. It's trying to make you afraid, so then you have to buy, you have to use...

Speaker 2: I just I just think it would be really helpful for people if if Dustin and Jan Yeah. Did a lot more media. Oh. Like they're willing to spend many many millions of dollars like promoting their world view

Speaker 1: Yeah.

Speaker 2: For... And and it would be just super helpful

Speaker 1: To watch them

Speaker 2: come into contact with you. Go and go and talk.

Speaker 1: Rock outfit or something.

Speaker 2: Yeah. Go and have like an hour conversation. Like open it up because like, of course, they're having conversations Sure. Behind closed doors every day about this stuff. Maybe they're mutes. Maybe they're silent. Maybe they both

Speaker 1: have silence. Maybe they're in a...

Speaker 2: I only communicate through nonprofit organizations.

Speaker 1: What's that thing? The silent retreat? Maybe they've been on year's...

Speaker 2: Because because the the EA camp is like happy to go and do podcasts. Sure. But it's like these sort of like, a very specific like type of person.

Speaker 1: Right? It's the funders.

Speaker 2: It's the... It's not the funders. It's it's the sort of front men. Right?

Speaker 1: Sure. Yeah. Whereas on the other side, it's certainly all the funders, all the VCs and all the all the biggest CEOs and the shareholders. Like, yeah. It is it is interesting. Like, yeah, the the... If you... The money on one side is happy to talk on everything and potentially too much. And then on the other side, it's a little quieter. Anyway, and P five hundred's up. It's ripping. The stock market's ripping.

Speaker 2: NVIDIA, also rallying.

Speaker 1: We're 3% away from a new record high. The S and P 500 surges above 7,600 as dip buyers continue to rotate back into technology stocks. We talked to a very sharp market analyst about the sell off and he said, I think it's a buying opportunity and I think he was right. How's NVIDIA doing?

Speaker 2: Almost 4% today.

Speaker 1: Okay. 4% today.

Speaker 2: No. It hasn't Repent. Still down I mean... 22% over the last month. So... Month is

Speaker 1: down 22%. But, yeah. We'll we'll we'll see. We'll see. CoreWeave is doing really well which is like completely reviving the AI trade. The Nasdaq erased last week's losses as CoreWeave results and prospect of higher anthropic IPO valuation boost sentiment. Yeah, the anthropic valuation is like jumping all over the place. The Wall Street Journal had an article, Anthropic sets value far below 2,000,000,000,000 for debut. Anthropic will seek a valuation of around 1,330,000,000,000. I've seen $12,000,000,000,000 floated. The range is 1.26 to 1.41. So things seem to be going well. I saw Joe saying it was oversubscribed by two or three x. Again, we've heard that for some IPOs, like you wanna be more in like that 10 x range, but again, we're still in a full week out, maybe eight days out. So we could see it get up to that point. At what point you would expect it to be at the top of the range and pop, but we'll see. We'll see. I have to give Bill Gurley a call to see if he's satisfied with the with the IPO process here. So US tech stocks jumped on Wednesday as better than expected results from Core Weave and the prospect of higher initial public offering valuation from Anthropic helped extend a rebound from last week's Wall Street route. First, before I go any further, let me tell you about CrowdStrike. Your business is AI. Their business is securing it. CrowdStrike secures AI and stops breaches. So traders pointed to results late on Tuesday from cloud computing group CoreWeave where revenue growth exceeded the company's guidance while the Feet reported that Anthropics bankers were weighing plans to increase the AI company's valuation to 1,500,000,000,000 in the coming days. So it's it's moving upwards. CoreWeave share price has halved since the summer after investors appeared to lose faith in the company, the company's debt funded bet on AI revenues. Core Weave shares were up 26.8%, you know, still down, not back to where they they they gotta go up a 100% to get back to their peak, but a solid, solid step forward for sure. Investors are being whipsawed by news flows and sentiment between this being a generational buying opportunity into AI or a classic value trap, they say. The jump in US stocks helped lift the dollar back to its strongest level since April 2025, exceeding a high reach last month. The greenback has climbed more than 1% against a basket of major currencies in the past two sessions, following higher than expected US inflation figures, which cemented expectations of Federal Reserve interest rate rise last month. So the AI trade is firmly back on and it feels like it's it's back to the shape of the trade, is like higher inflation, higher interest rates. It's not entirely over for software companies, but the... But demand for compute continues to to grow. Our across the end of ramp put out the latest ramp data that was seemed sort of weak, but out of line with what Anthropic has said around like 13% growth. And on the ramp data, was 1%. So there's some sort of delta going on there, some difference between what's going on in the enterprise versus what's going on on the credit card data and the panel data. But in general, it seems like there's a lot of cautious optimism that the long term trends will just continue, especially with the launch of new models that can do more and more stuff, make videos and work on complex CAD files and designs. And the GDPX benchmark from semi analysis is far from saturated. Like Fable 5.2, really, really strong results in a bunch of places. But the jump on GDPX went from like 12% to 16%, which I mean I would expect that that continues and they... Everyone hill climbs that over the next year. But it was

Speaker 2: A ways to go.

Speaker 1: Yeah. It was a ways to go. It was it was refreshing to see that there's that there's many more things to work on. And I've I've still noticed that there's these odd there's these odd holes in the models even the really really smart ones where if there's just something that is brand new or not in the training data yet or hasn't hasn't worked its way and it's still like sort of... It it's it's... It requires a major update like that. The the continual learning coinage from is still firmly in in process. And I was I was listening to a breakdown of the of the 5.2 model card last night, and there's there's a lot of debate even within Anthropic over... Like, there's one researcher who says, like, you know, AI research is being accelerated, the next and the next and the next researcher is saying, like, no. Like, the bottleneck is hiring. There's another person that says, oh, it's fantastic. It's speeding up AI research. There's another person that says, I still haven't seen it come up with a good idea. Like it's great at testing a bunch of things that are verifiable. I was listening to Demis on Masters of Scale last night. And I mean, he's just great. But he laid out a very interesting bull case for Accenture as a as an AI auditor. Because I think when people saw that they were like, we're picking between like Meter, which is like the most San Francisco company and Accenture, which we think of as like a total outsider New York company. But Accenture actually acquired a startup with a founder who's deep in research in AI and so they have a growing and scaling AI auditing team that's very sharp, but then they bring the organizational infrastructure and the trust of Accenture. So it it made me very optimistic about Accenture as an AI auditor, which I hadn't heard the nuance there. I assumed it was just gonna be The Accenture pencil pushers, you know.

Speaker 2: New bottleneck.

Speaker 1: Which would be good. You know, I I I think the pencil pushers have a role to play in in AI safety and AI research. But it it it is important that you're able to, like, bridge those gaps and and follow strict rules, understand how these organizations work. But still, you do have to understand the technology a little bit. So it was good. Anyway, Nick Carter's bullish. He says worrying about AI oversupply in 2026 is like worrying about petroleum oversupply in 1910. We got room to run. I love it. Well, let me tell you about Cisco. Critical infrastructure for the AI era. Unlock seamless real time experiences and new value with Cisco.

Speaker 2: Should we talk about ratios?

Speaker 1: Please.

Speaker 2: Mix it up.

Speaker 1: What you got?

Speaker 2: Let's head over to Tai Lopez.

Speaker 1: Okay. Let's do it.

Speaker 2: Tai has a new framework for how he is competing out in the market and I think it's I

Speaker 1: think it's This is really really sharp.

Speaker 8: How often you should travel. I use Elon Musk's framework. He's doing 250 flights a year. That made him a trillionaire. So if you wanna make a 100,000,000 or let's say you wanna make a billion, you take some ratio. You should probably fly one fourth as much as Elon. So that's let's say 60 flights a year. I've been in South Of France, Denmark, Norway, Sao Paulo, Brazil, New York City, my farm in Virginia, Utah, LA, Arizona. Yeah. 10. Now that ratio is a little bit not my favorite ratio but I'll think over the year I'll even it out.

Speaker 3: So just

Speaker 8: turn everything into ratio

Speaker 1: everything into ratio. Take this ratio. So if he's... If Elon's doing 250 flights a year, let's say the average flight's six hours, there's sixty minutes in an hour, sixty seconds in a minute. If you wanna just be a millionaire, and Elon's a trillionaire, so you need to do 1,000,000 times fewer flight hours. You should be in the air for five point four seconds. Yeah. So if you're in the air for five and a half seconds, that's enough travel to be a millionaire. If you use that ratio. It's not my favorite ratio.

Speaker 2: Yeah. It's not my favorite either but it's not. It's a good like it's worth it's worth like you know thinking about.

Speaker 1: It's a heuristic.

Speaker 2: Yeah. Know, he's thinking... It's a mental model.

Speaker 1: Yeah. Yeah. Yeah. Idea...

Speaker 2: Life is just a series of ratios....

Speaker 1: Is insane. I love it. Halo is saying

Speaker 2: I can jump and hold that. You know, find the right... You could become a millionaire just by jumping off of

Speaker 1: a building

Speaker 2: as long as you're...

Speaker 1: Sounds like a cliff jump. Five seconds in the air?

Speaker 2: That's a long time.

Speaker 1: That's a long time. How how how long how high do you have to jump from?

Speaker 2: I think you might... I don't think you'd make... Think...

Speaker 1: Is that five in the air? I

Speaker 2: think you're hitting the water like cement.

Speaker 1: Yeah. Sorry buddy. We're... But maybe a series of jumps. So you're not flying but you're doing two jumps a year for... Yeah. What is... If you

Speaker 6: wanna do one continuous fall, five seconds, it'd be a 109 meters. So that's 357 feet.

Speaker 1: Is that survivable? Into water? You need to...

Speaker 6: I mean, I'm probably good.

Speaker 1: Yeah. I could. Skydiving. Maybe skydiving. You go skydiving.

Speaker 2: The highest recorded cliff jump in the world is a 192 feet.

Speaker 1: Oh. So unsurvivable. Okay. So don't try it. Don't try and jump for five seconds. And but instead the 200 jumps.

Speaker 2: The beauty of jumps is like you have a whole year to get the five seconds

Speaker 1: of

Speaker 2: airtime.

Speaker 1: Exactly. If you want to be a millionaire. You're doing every every day you jump just a little bit you get you get point one seconds.

Speaker 2: Stack that up over a Yeah. I'm running circles around you. Two weeks a month, know, it's game over.

Speaker 3: You're

Speaker 1: toast. You're toast. You're toast.

Speaker 2: Yeah. So anyways, really shifted my mindset. Yeah. Because now I'm thinking about I'm thinking about have all the ratios All in my

Speaker 1: the ratios. Yeah.

Speaker 2: Anybody that you might want to emulate their success just like figure out some of the mundane activities...

Speaker 1: How many meals a year do you eat? If you want to be 1,000 times less successful, eat 1,000 times less calories. Crazy. Jeff Gas, founder thinks that there's no such thing as a stock market bubble.

Speaker 2: This warmed my heart. Why don't why don't why don't we Yeah. Get into

Speaker 1: Bubbles are going on the nice list. Are they going on the nice list or the naughty list? We don't like when they pop. We like bubbles. Okay. Well, Jeff Yass thinks that they don't exist at all. He says in 1999, just as today, when share prices fall, it isn't a delusion correcting, it's uncertainty resolving. Every time the market falls, the pundits come out with the same diagnosis. It was a bubble. Speculators lost their minds and somebody should have stopped them. This time, the pundits are early. They decided artificial intelligence is a bubble before anything had fallen. Really? Why would rational investors suddenly lose their mind? Start with the word itself. What is a bubble? The bubble collars mean a price that a price that hype has pushed above fundamental value. Notice what that assumes. That there is a true price. The market has lost sight of it. And that when prices come down, reality is correcting a delusion. This totally misunderstands prices and under uncertainty and volatility. There is no true price to lose sight of. The value of a new technology is uncertain and a price isn't a verdict on what it's worth. It's the market's best guess. Every possible future weighted by its likelihood of payoff made by millions of people with their own money on the line and more information than any pundit can hold. The market isn't right. It's just a much better instrument for predicting value under uncertainty. When prices fall, that isn't a delusion correcting, it's uncertainty resolving. Go back to 1999. He's taken us back in time. An internet stock trades at a $100 a share. If it turns out to be the next Amazon, it goes to a thousand dollars a share. If turns out to be the next pets.com, it goes to zero. Say the market puts the chance of becoming Amazon at 15%. Do the arithmetic. 15% of

Speaker 2: a thousand. Take the ratio.

Speaker 1: Take the ratio.

Speaker 2: Think of the ratio.

Speaker 1: Take the ratio. 15% of a thousand, $150. So at a $100 a share, the stock isn't expensive. Buying it is a sensible bet. Let me tell you about MongoDB. What's the only thing faster than the AI market? Your business on MongoDB. Don't just build AI. Own the data platform that powers it. Oh, yeah. We got to do a a bonus read for Cisco because Cisco got jammed up at the end of the show. Was the greatest ending to a show ever. Wait. One more thing. Cisco. End end the show. Now, if it turns out, if this stock, this hypothetical .com stock turns out to be pets.com and the stock goes to zero, was it a bubble? No. The buyers were betting on a 15% shot and the 85% came in. The best guess of the stock's value was a $150 and the most likely outcome was zero. Both were true at once but most pundits can hold only one of those ideas in their heads. And 15% isn't rare. A random day is Tuesday about fourteen percent of the time. A random day is a Tuesday about 14% of the time and no one is shocked when it's Tuesday. Are you shocked? No. Even the winners looked like bubbles at the time. Amazon fell more than 90% from its 1990 peak. That is a crazy, crazy stat dealing with a 90% drawdown from the peak. If you judged it by the crash you'd have called it a bubble too. Yet investors who held the whole sector long enough came out ahead because very because a very few spectacular winners paid for all the pets.coms. That's how the entire stock market works. Hendrik Bessemer Binder of Arizona State University studied every US stock since 1926. Surprisingly most of them returned less than treasury bills over their lifetimes. And about 4% of companies produced all the market's net gains. Most bets lose and few and a few huge successes pay for everything. If every losing bet counts as a bubble then the market has always been one. Losing a bet doesn't make it irrational. When the Knicks were down 29 points against the Spurs in game four, the betting markets gave...

Speaker 2: People in the chat says, I've studied every stock.

Speaker 1: There we go. This this investor has or this

Speaker 2: guy did?

Speaker 1: So the Knicks came back and won. Anyone who said the bookies were wrong was wrong about the bookies. A 3% chance comes in 3% of the time. That doesn't make the bookies right either. The most you can say is that the sports book was smarter than any one than any one better. Once you know the ending, it's hard to remember that you didn't. Artificial intelligence is where the internet was in 1999. Bearish. Nobody knows how big it will be, which firms will win, or whether the winner winners will end up a 100 times bigger or 10,000 times bigger. That uncertainty makes prices swing harder in both directions and a small chance of an enormous payoff is worth a lot today. So prices across the whole field look too high to anyone who isn't thinking in probabilities. Prices will probably come down. And as uncertainty resolves and winners and losers shake out, what the bubble callers can't tell you is when, how high prices get first, is is when, how how high prices get first or how far they fall. This is the notorious problem people calling bubbles too early. When the fall comes, it won't prove anyone was irrational. Yeah. I saw someone posting like, oh yeah, when Jensen signed that girl's t shirt that was your signal to sell. It's like I think Nvidia like five x since then and it's down like 20%.

Speaker 2: It could have been that much but... When

Speaker 1: he put on the leather jacket that was the sign and it's like that was twenty years ago. Like I'm pretty sure that was not the sign. Hype is real and it moves prices but the speculators buying and selling AI stocks know that and factor it in with their own money at risk. The idea that hype is something a talking head understands. He's really taking a shot at the talking heads, Jeff. Come on the show, debate it with us in person. Let's see who knows more, the talking head or you?

Speaker 2: CMC in the chat said something Yeah. Shared an interesting detail that I forgotten.

Speaker 1: What's that?

Speaker 2: It's that Nvidia actually replaced Enron and the S and P 500 Oh. In on 11/30/2001. Beautiful. And

Speaker 1: you're wearing the the sweater to commemorate it. Right?

Speaker 2: That's right.

Speaker 1: The Jensen sweater. Well,

Speaker 2: we're still a few days away from from that.

Speaker 1: Earnings next next week for NVIDIA. That'll be interesting. I imagine they'll do very well. Do you know anyone with a good record of predicting bubbles? Neither do I. Calling a bubble is a free option. If the market craters your famous...

Speaker 2: It is really crazy that the the people that are most famous for calling bubbles end up with like a sub what like a 1% hit rate like overall. Yeah. So like 1% of the time they call the bubble perfectly Yeah. Which is like really really hard to make money Yeah. Doing that. Totally. It's about, you know, every single time you're like, okay, I'm calling it, I'm going short. Yep. And yeah, it's tough tough business.

Speaker 1: There's a ton of like structural factors in these businesses. Stuff just goes... It just takes so long to work through. Everything. It's it's very hard to call the timing. But he... But his point is that if the market creators you're famous, if it doesn't, you just go into never mind mode and call the next one. And so if the bubble callers know the true price and the market doesn't, let's see the track record.

Speaker 2: Yeah.

Speaker 1: The bubble story survives because it flatters people who can't beat the market. But being rational isn't about being right, it's about and being irrational isn't about being wrong. Rational is being smart and humble about uncertainty. Irrational is being dumb and arrogant about it. It is arrogant to believe you know more than the market and you'd be a fool to listen to a pundit who says he does. So here's a rule. If you think AI is a bubble, buy puts. The most you can lose is the premium. And if you're right, you'll get rich and have earned it. If you won't buy them, then when the market falls, don't call anyone irrational. The market called it first. Good op ed in the... John.

Speaker 2: Yeah. We got to talk about hobbies.

Speaker 1: Okay.

Speaker 2: It's time.

Speaker 1: The great hobby debate.

Speaker 2: Masha Butcher, the butcher Yeah. Says, the best founders I backed had no hobbies, only one obsession Mhmm. The company. And Martin Casado, widely known as the 2026 Venture Capitalist of the Year according to me and not based on any... Remind me.

Speaker 1: Just... I I mean, I know Martin...

Speaker 2: Cursor... He was the cursor in open router, World Labs, Yeah.

Speaker 1: Like at

Speaker 2: least when you get like a 100 bill like Yeah. Something close, you know, getting into the range of like

Speaker 1: I didn't realize... I knew a 16 z did all three of those. I didn't realize he did all three of

Speaker 7: them. Yeah.

Speaker 1: That's pretty impressive. Wow. So Martin's not... He might

Speaker 9: have a really

Speaker 1: strong showing on the Midas list this year.

Speaker 2: Bay says, the best founders I've backed had no bodies. No arms, no legs, no hands, no feet. Just brains and vats plugged into the company's Slack.

Speaker 1: Sick.

Speaker 2: And Sheil breaks it down for us. Famous hobbies outside of work, Mark Zuckerberg, Brazilian Jiu Jitsu, MMA, surfing, hydrofoiling. One, I don't know that he was doing any of these things prior to, you know, having a trillion dollar company, so I I would almost give that point to Masha.

Speaker 1: Yep.

Speaker 2: Bill Gates, bridge, tennis, pickleball, and reading. He read... He knew how to read when he was building his company. I don't know how much time... I I honestly don't know. Is the the Bill Gates history enough to know if he was like playing a lot of 10 on it. I certainly wasn't playing pickleball when he was building Microsoft. Yeah. And he's also not like, you can't put retired people on this list. Steve Jobs, Zen meditation, music, long walks, Japanese art and design. I don't think of art as a hobby unless you're... Unless he was making Japanese art.

Speaker 1: I think this is big question is what is a hobby and what isn't a hobby? Because Teal was recently interviewed and he said like his hobby is having these dinner... You saw having dinner parties with interesting people. And I'm like, that's pretty close to just nice

Speaker 2: That's utility.

Speaker 1: Dinner for your fun.

Speaker 2: Also, that's like a utility. I need to eat one way or another. Maybe I'll I'll turn it into work.

Speaker 1: Yeah. It's like I started my YouTube channel as a hobby. Now it's a full time job and it's kind of evolved. What what is a hobby? I feel like the the hobby needs to be truly non monetizable, completely unrelated. It needs to be like, you're a lawyer and you build ships in bottles and there's no connection and like building building a ship in a bottle is the peak hobby. Like you can't get more hobbyist than that. Maybe model trains, stuff like that. But something where there's no commercial bleed over whatsoever. But if you're like my hobby is bring together the best minds in my industry for dinners, That's just extra work that's kind of fun as well. And it's great because you clearly found your life's work. You found your Ikegai, your purpose because in your free time you can do things that feel fun but still have value to your overall mission and purpose. But there are so many things that where... First off...

Speaker 2: Also, you got to have... You got a clear minimum. Like if you do something for ten hours a year, I don't really consider you an active participant in the hobby. Mhmm. You're very much casual. Right? Sure. So going down this list, Sergei Brin, trapeze, gymnastics, diving and burning man. Okay. So burning man I view as a vacation.

Speaker 1: That's vacation. I wouldn't call... But there are some people that like cars for like...

Speaker 2: I love to do diving. I love to go diving. Know. Are you putting up how much how many hours under the water are you putting up? Because I don't...

Speaker 1: Yeah.

Speaker 2: It's not like you can say like, oh yeah, he's really into hobbies if he's putting up five hours of diving a year. Sure. Right? Yeah. I wouldn't count that. Yeah. Hobby has... Jeff Bezos sailing, flying helicopters, ocean exploration. Again, I don't know that he was doing ocean exploration. It's funny that Allison isn't on this list when he's like the most Hobby Max like CEO. Yeah. Dog fighting with his son Yeah. Sailing Sailing. And stuff.

Speaker 1: But even that, I mean there's Oracle logos all over the boats and stuff. Let's check the tax return. Is that is that is the sailing... Is Sail GP...

Speaker 2: Notably absent from this list is day drinking. Like none of these...

Speaker 1: Did you come up with that or somebody said that?

Speaker 2: Well, no. No. I I just said that. I'm not gonna hear none none of history's greatest song Edward

Speaker 1: 40 hands, is that a hobby? Does that count? No. Obviously there's a lot of founders that pre product market fit are fully locked in and are not actively doing hobbies. And then also So... Things like watching TV, watching movies, video games, hanging out with friends, drinking, going out to dinners. No one counts that as a hobby. That's just taking time off. Like you wouldn't say like, oh yeah, my family is a hobby. Right? Oh yeah, have a hobby. Rearing children. Rearing children is not is not a hobby but it still takes you away from work in a great way. But needs to be like an extra thing that's so... Here's here's

Speaker 2: one though. Long walks. Is that a hobby? Walking? No. I think No. I think it can be. I

Speaker 1: actually New think definition. It if it's a hobby, you have to go to Home Depot at least once a quarter for it to be counted as a hobby. You have to stop by a physical

Speaker 2: store. Move... Cinema. Especially A store? Can cinema No. Think cinema can No. Be a

Speaker 1: Unless unless you're building a home movie theater and you're you're at Home Depot picking out sound isolating wall materials, then it's your hobby. But if you're just going to the theater that's just being a normal person. You don't have a hobby. No. It needs to be something

Speaker 2: where I'm you're creating a a normal person. I never go to the movies unless unless we're gone for work.

Speaker 1: Yeah. But but even even if you went and you were like, I'm a fan. I'm a cinephile. That's that's just being

Speaker 2: So the technical definition, it can't be primarily for financial gain or professional obligation. Okay. And so I think that walking I think that walking can be a hobby. I I do think that you could...

Speaker 1: Working out is not a hobby.

Speaker 2: I disagree. I think you can make it a hobby.

Speaker 1: I don't know. Sleeping? Sleeping a hobby?

Speaker 2: I think it's one of the... I think it's a very lame hobby because I've... Sleeping? No. No. You

Speaker 1: think sleeping is a lame hobby?

Speaker 2: I'm talking about working out. There was a period of my life where like going to the gym

Speaker 1: You took it. I treated it. It's really a hobby because And I

Speaker 2: was like what am I what am I doing?

Speaker 1: But you were going to Home Depot to get special you know supplements probably. Or the equivalent of Home Depot nutritional sob shop. Vitamin shop. If you're going to the Vitamin shop that is a specialty hobby hobby level store. It's like you went to the model train store, that's now your hobby. But if you're just going to the gym and you're not actually building new things and creating something from scratch and like innovating in the little discipline.

Speaker 2: You don't think... So do you think sleep is a hobby for Brian Johnson?

Speaker 1: Yes. Well, no. Because it's financial gain for him because he... That's his business.

Speaker 2: He's monetizing.

Speaker 1: But there are some people for which sleep is a hobby where they are constantly tweaking it. It needs to be it needs to be a a a constant evolution. So if you have a gym routine and you're like, yeah, go to this gym and I haven't changed what I do and I'm not like an... You have to be a nerd about it. You have to nerd out for it to be a hobby.

Speaker 2: Yeah. And that means For example like I don't dirt biking. Dirt biking is not a hobby of mine. Yes. I have a dirt bike. Yes. Ride it.

Speaker 1: Yes. But it could become a hobby if you were working on your dirt bike, constantly getting a new one, finding new trails, building new trails, doing all these different things, part of the community, going to Home Depot. That's an important step or the Home Depot equivalent of like the dirt bike store. If the guy at the dirt bike store knows your name, you're in the hobby world.

Speaker 2: Hobby territory.

Speaker 1: But but but if you're just doing it for fun every once in a while, not a hobby.

Speaker 2: Yeah.

Speaker 1: That's my bar. Anyway Honestly Founders obviously can be founders for decades and

Speaker 2: I might have pre product

Speaker 1: market fit, it's hard.

Speaker 2: I think I'm getting more getting more convinced that the butcher might be right.

Speaker 1: No. I don't. So I completely disagree with this. I completely disagree with this because it's it's it's founders. Founders does not mean pre product market fit founders. It means all founders. Plenty of founders start their company, have no hobbies, and then three years in, it's a billion dollar company. They've taken $20,000,000 in secondary. They have a whole staff and executive team. And there is time and space for hobbies to creep in. And those do, occasionally. I

Speaker 2: would just say a lot of these are interests, not hobbies. Then you got to get into the difference between like like interests or things that like if you had a lot of time you'd be doing them, they would be hobbies. Right?

Speaker 1: Yes. But what I'm saying is like I count Brazilian jujitsu as a hobby of Mark Zuckerberg. It's not directly related to the financial gain. He is a nerd about it. He's constantly improving. He takes it very seriously.

Speaker 2: Honestly... And

Speaker 1: why is he able to do that? Because his business is scaled. He has control. He has time on his hands. He has some flexibility. Now, did he have hobbies in the first year? Probably not. In 2005, 2000...

Speaker 2: In the second year, probably not. No. In the third year, probably not.

Speaker 1: Probably not. But Four ten years years in in, probably

Speaker 2: not.

Speaker 1: But you don't stop being a founder after ten years. She didn't say early stage founders. She said best Well,

Speaker 2: all I'm saying is for for Shields rebuttal.

Speaker 1: Okay.

Speaker 2: He's listing a lot of people that are founders but are not active in the companies that they founded anymore.

Speaker 1: Mhmm.

Speaker 2: And...

Speaker 1: A lot of these are active founders. Elon went during the video game run for sure active at that time, very active. Warren Buffett still active. Bezos, some of this stuff was going on. I would count him still as an active founder across Blue Origin. I think he's still involved at at Amazon as well. Jensen for sure. Sergei is still really involved with Alphabet. He's still the founder. Like, the... All these people are are... Were founders even even post grind, post early day to day. What do say?

Speaker 6: Also she said best founders I've backed had no hobbies, not have no hobbies.

Speaker 1: So it could be before starting the company laser focused, which if that is the read, I agree with it. I agree with it.

Speaker 2: Let's pull up this video of Warren Buffett Yeah. Playing the ukulele

Speaker 1: Okay.

Speaker 2: On CNN.

Speaker 1: And see if it's Hobby or casual.

Speaker 2: Or just like an interest.

Speaker 1: Let's pull it up. You have it? And then we're going over to public. Let me tell you about public. Invest across all asset classes. Automate anything with AI agents. Run trading strategies, risk management, money movements and monitor markets with AI agents for investing on public. Team has it.

Speaker 10: We're gonna come to this magnificent moment in musical history.

Speaker 1: It is a moment

Speaker 10: in musical history. Have you met Frank Sinatra before he died of me?

Speaker 9: No. I never met Frank Sinatra.

Speaker 1: You're a fan?

Speaker 9: And I'm a fan.

Speaker 10: And you're a fan of ukulele?

Speaker 9: Yes, and you just handed me to the... Just

Speaker 10: to make it clear to viewers, Warren has not played this instrument before, this particular one. We purchased this in New York City today, but we believe it's a good one. He has had a little practice on it. You're ready to go, and this is Warren Buffett singing Frank Sinatra's My Way.

Speaker 9: Joined by...

Speaker 10: I'm a little bit of murmuring in

Speaker 9: the Let's

Speaker 1: let's do it.

Speaker 9: Here we Now, the end is near and so I face the final curtain.

Speaker 2: Hobby. My friend.

Speaker 1: Hobby. Hobby.

Speaker 2: I'll say it clear. Elite. Confirm.

Speaker 9: I'll say the time.

Speaker 1: Something else or of

Speaker 9: which I'm certain. Certain.

Speaker 3: I've lived

Speaker 9: the life of small and traveled each and every highway and more. Much more than this. I did my my way.

Speaker 1: Elite. That That's a... And you know and

Speaker 2: you know it's Hobby, you know, he you know he really has love for the uke Yeah. Because he just just picked up...

Speaker 1: Something like

Speaker 2: It wasn't even his. Wasn't even his. He just picked it up.

Speaker 1: Yeah. Yeah. That's true. Tyler, do you have any hobbies?

Speaker 6: Memorizing Homer. That's a good hobby I...

Speaker 1: Memorizing Homer? Yeah. Recite some Homer.

Speaker 6: Rage goddess. Sing the rage of Pellis' son Achilles. Murderous doomed that cost the Achaeans countless lots. Oh, wow. Falling down to the house of death. Okay.

Speaker 1: Legit hobby. I was going to point out the fact that you have multiple Rubik's cubes on your desk right now. That's extreme Hobby territory. The fact that if you had just had the normal three by three Rubik's cube, would say casual. But how... What is that? 10 by 10?

Speaker 3: Nine

Speaker 1: Nine by nine? Yeah. That's Hobby territory. The guy at the Rubik's cube store knows your name. Confirmed. Confirmed for The guy at the Rubik's...

Speaker 2: I went to the Rubik's Cube store and they didn't know.

Speaker 1: They didn't know you. Yeah. No. I went to the Hobby Hobby store and they didn't know you. Let me tell you about Console. Console builds AI agents that automate 70% of IT, HR and finance support giving employees instant resolution for access requests and password resets. Welcome to the show. I would love to shake your hand but we're both a little sick so I'm going sit over here. Yeah. We're staying away.

Speaker 2: We're staying far away.

Speaker 1: Salute. Great to see you. Thank you so much for coming on the show. Thanks for having me. Please introduce yourself.

Speaker 3: Yeah. Hey. I'm Dan Goldenberg. Yeah. Retired Navy captain, former corporate guy, and the president of the Call of Duty Endowment.

Speaker 1: I'm very excited. Thank you so much for being with us here on Veterans Day. Can we go back in time? Tell me just your your... Where'd you grow up? Your childhood story. I want to hear the whole journey,

Speaker 3: basically. Yeah. Grew up in a small blink if you miss it kind of town in Orangeburg, New

Speaker 1: York Okay.

Speaker 3: Which is about a fifteen minute drive north of Manhattan.

Speaker 1: Yeah.

Speaker 3: Grew up in there, the most boring place you could possibly imagine to grow up.

Speaker 2: Fifty minutes from Manhattan?

Speaker 1: Yeah. Know.

Speaker 2: How is that boring? I feel like you could But you you but but couldn't you walk into the city once you were like five or six?

Speaker 3: Believe me, there was like no public transportation. Yeah. So I was craving to do something a little more adventurous. Yeah. When I was 17, I joined the Navy.

Speaker 1: 17? Yeah.

Speaker 2: Wait. But we we were just talking about hobbies. We got to know your hobbies growing up.

Speaker 3: Oh, gosh. Well, I was I was kind of a jock, so...

Speaker 2: Mhmm. Thank you. For your service.

Speaker 3: I was I was a runner pretty much. Ran Cool. Cross country, winter track, spring track. I also like to write a lot. Okay. So I was involved with school newspaper school government, that kind of stuff. But sports in high school became pretty...

Speaker 1: Did the guy at the sporting goods store know your name? Because you were such a dedicated runner. This is the bar

Speaker 3: for Yeah. Like... Yeah? I mean, the nice thing about running...

Speaker 1: Small town. Like low... Yeah. You don't need that much gear. You just

Speaker 3: need kicks.

Speaker 1: Yeah. Exactly.

Speaker 3: So, you know, we... Back then we didn't have high-tech stuff. So we were running like potato sacks, sweatpants,

Speaker 2: stuff like that. So

Speaker 1: joining the Navy, do you walk into a recruitment center? What what... How does It that

Speaker 3: was really weird. My dad's a veteran or was a veteran. Yeah. He army drafted Yeah. All that. He was a paratrooper.

Speaker 1: Is that Vietnam?

Speaker 3: Career? Before Vietnam. After career before Vietnam.

Speaker 1: Okay. I got you....

Speaker 3: '61. But the other interesting thing about where I grew up Yeah. Or or one of the only interesting things is we were about thirty minutes south of West Point. Oh, yeah. So to get me out of the house, I was I was a a challenging child.

Speaker 2: Mhmm.

Speaker 3: So getting getting me out of the house so my mother could study and finish her degree

Speaker 1: Mhmm.

Speaker 3: He'd take me up, run... Let me run wild at West Point. So

Speaker 1: I saw that... You're in the middle of you.

Speaker 3: Yeah. So the academy was interesting to me. Yeah. I thought what I wanted to do is become an astronaut.

Speaker 1: Oh, yeah.

Speaker 3: And I I I started doing research on it and I read that, hey, the most astronauts have gone... Come from the Naval Academy. Yeah. That's interesting. I sure as hell am not going to West Point because they stole all the girls from my high school.

Speaker 1: So that wasn't that wasn't happening. Okay.

Speaker 2: High school?

Speaker 1: Oh, yeah. Those West Point... Those army guys, let me tell you. Yikes. So

Speaker 3: the the... Literally, this is way pre Internet. Yeah. Only book, that was my only way to do research at the library on the Naval Academy, was this great book called A Sense of Honor Yeah. Written by a guy named Jim Webb. Mhmm. Eventually became a senator or secretary of the Navy. And I was like, this sounds pretty awesome. Yeah. And so, yeah. So I I I went for it Mhmm. And it worked out. Best decision

Speaker 1: I ever made. Twenty six years? Twenty two years?

Speaker 3: Let's see. So graduated in '92. Yep. So almost twenty twenty eight years total. Yeah. About nine years active duty eight... Another eighteen reserve after that.

Speaker 1: And and while you're active duty, are you all over the world? What are you working on within the Navy?

Speaker 3: Yeah. So when I was active duty, I flew a two c Hawkeyes. Our motto was we're slow but at least we're ugly. Okay. It's that gumba on the top Yeah. Based aircraft. Yeah. And I I did that. Then I got a Pentagon tour Yeah. Which is really interesting. Remember I said I like to write. I was stupid enough to admit that to someone and I got a job as speech writer in the Sure. Three years. And then my last day in the Pentagon was 08/11/2001. Wow. Had a had a kid by then and... Wow.

Speaker 1: Yeah. That's a crazy time.

Speaker 3: Yeah. Yeah. So I decided at that point, not much going on in the world, not that I wanna be at sea for the next seven to nine years. Yeah. So I wanna be there for my kid. Yeah. And so I went off to business school. Well my first day of business school was 09:11. Wow. And then I I raised my hand, went back in as a reservist doing intelligence work.

Speaker 1: So I

Speaker 3: did the next eighteen years doing intelligence work.

Speaker 1: So so reservist but you're... But there is a role like how many days a week? Do you have a separate job? Walk me

Speaker 3: through that. Had a very busy civilian job

Speaker 1: Yeah.

Speaker 3: Working in information services Sure. And management consulting businesses Yeah. Which is great. But, you know, made for that, like, the reserves after nine eleven were were nothing like the reserves before then. It was kind of before then a knife and gun club.

Speaker 1: Mhmm.

Speaker 3: And afterwards, it was, you know, like we come in, we do the mission. Yeah. And and we were we were very active. So I I... My typical week would probably be a hundred hours between my Yeah. Civilian job and reserve work. I just had a saintly wife who was very supportive of that. Yeah. And yeah, I I got, you know, kinda hooked on that work and

Speaker 2: Sure.

Speaker 3: You know, was interesting having one foot in the commercial sector and one foot.

Speaker 2: Yeah. Wait. How do you Yeah. How do you balance what I assume was like sending a lot of somewhat boring emails with your with like your the night shift being like your work your country's at war and and you're supporting you know I'm sure multiple branches and it feels like tough to be like I'm gonna hit send on this and then I'm gonna go, you know... Save the country. Like it's hard to be like what what's your real what's really your real job at that point. You feel like you have a very...

Speaker 3: Some people have told me I don't feel this way that I'm pretty good at spinning plates. So but, you know, I felt it was more like sometimes when the day job was a drag Mhmm. The reserve job was really interesting and vice versa. Mhmm. So it kinda kept me Yeah. Kinda grounded and level. I also think a lot of what I was learning in the commercial sector, was able to bring over to

Speaker 1: the military. Yeah.

Speaker 3: Totally. Which which, you know, in turn made me more valued there. And, you know, it sort of recharged my battery and, you know, knowing that if things weren't incredibly compelling during the work week Sure. And this is before the endowment Yeah. I, you know, I had something pretty interesting in store for the weekend or for a couple weeks going going on temporary active duty orders.

Speaker 1: Sure. Yeah. So take me through the path to activation.

Speaker 3: Yeah. So I was ten years into my commercial sector Yeah. Path. And honestly, I felt like I was in a role where I had a big big job. I had a lot of people working for me Yeah. Or with me, and and a fancy title. But it wasn't really what I was looking for. It wasn't mission driven. Mhmm. It wasn't, you know, it's hard to explain what I was doing to my kids and Mhmm. You know, it it just... It wasn't... Computer. Yeah. So all all of a sudden this came along. A buddy from naval aviation and from the naval academy actually said, hey, some search firm guys, some head honors came to me about this opportunity. It's not really for me, but I know you're looking for some more purpose. Yeah. It's pretty neat. You should check it out. And so it was an opportunity to lead Activision's foundation, the Call of Duty down at which had got off to a really good start in terms of building the brand and honing on their mission, but they were kinda stuck. They just hadn't had good impact. And the really neat thing about the leadership at the time was they didn't want to be like typical corporate philanthropy, the big cardboard picture, what I call fire and forget philanthropy. Yes.

Speaker 1: It's a very different structure because there's so many different advantages from the player base to the connection to the to the real armed forces, not the virtual ones. And and there's so... And then employment opportunities. There's... So talk about the scope because, again, it's not just write a check and forget.

Speaker 3: Absolutely not. In fact, honestly, in the first two years the endowment... When the endowment launched before I was there, they kinda had a bad experience.

Speaker 1: Mhmm.

Speaker 3: They had written a couple large checks Mhmm. Large, not compared to what we do today, but back then they were pretty Mhmm. More than $100.

Speaker 2: Mhmm.

Speaker 3: And two non profits. And a year later, they checked back with one of them. I won't say the name, but it's a name everyone here would know. And a year later, not only could they not show the impact of the money, they couldn't even account for the funds. Mhmm. And the board said, this is never happening again. Yep. You know, we are gonna apply the same accountability to results that we apply to our business Yeah. To our philanthropy. Yeah. The difference is, you know, we want a return but it's gotta be a social return. It's gotta... We we have to know quantitatively that we made the world better for people. So that's why they brought me in. I was a business guy who happened to be a veteran. Yep. Not a non profit person at all. Yep. And they said, oh, you'll learn that stuff quickly. It wasn't quite as easy as as advertised. But but I was incredibly well supported and,

Speaker 1: you

Speaker 3: know, given given a lot of free rein to re architect this. So I started looking at applying kind of a consultant tool kit to this of what are all the things that have to go right for a veteran to get a job? Yeah. The value chain, if you will, for that. Sure. And, you know, what what's going right and what could go wrong at every stage? And what our hypothesis was is that resumes and interview practice is... Seems to be the areas where veterans really off. I'd also argue figuring out what's next. Right? Because Totally. Hard for everyone.

Speaker 1: Especially if you're in a structured environment Yeah. That it it like where there isn't that much change and all of a sudden you come back to the economy and there's upheaval Yeah. Different sectors are higher...

Speaker 3: I mean, for me the first time I interviewed for a job, I was 31. First time in my life. Yeah. Except when I was a busboy like Yeah. A teenager. And that wasn't much of an interview. But...

Speaker 2: Yeah. I remember I remember that I remember that basically doing a boy interview in in high school and there it was like five minutes. Yeah. Yeah. Basically could get the get the plates here, put it back here and and show up to work You on think you can show up and work on on time? Yeah. Yeah. Yeah. Think so. And he's like, yeah. I was like, that's it? And he's like, yeah. You got the job. You're good.

Speaker 3: Yeah. So so so, you know, I knew it from the standpoint of being a veteran but I didn't really know it. I had never been thoughtful and analytical about it. So Yeah. That really helped and we said, okay. Let's find organizations. We don't care about the brand. We only care about impact. So we're gonna find organizations that are really good at those handful of things. Mhmm. Years later, we were validated. Penn State did the study. They found out if you get, you know, help... Professional help preparing a resume and professional help practicing for an interview as a veteran, you're three times more likely Wow. To land a high quality job.

Speaker 1: So That's great.

Speaker 3: We we guessed well.

Speaker 1: Yeah. Going back a little bit. The source of funds. Yeah. I mean, the Modern Warfare four is phenomenal. I've been playing it. It's great. Reviews are fantastic. I also noticed that in the store, there are various battle passes. There was a veterans themed product. Yeah. Is that a source of money or Yeah. Is it is it from the overall sales? Like, what is the top of... Where does the money come from, basically?

Speaker 3: Yeah. So just stepping to answer your question. Call of Duty Endowment is a legally separate entity.

Speaker 1: Okay.

Speaker 3: Five one c three Yeah. Foundation. But Activision since the very beginning has been an incredible partner. Yeah. And the in game items for the endowment which we've been doing I think for more than a decade

Speaker 1: Yeah.

Speaker 3: An incredibly important source of revenue. Yeah. Every cent Activision gets goes directly to placing vets in jobs. Yeah. So that's really unusual because the company covers almost all of our operating costs. Cool. So that... So that's our continued commitment to players. Yeah. And our player, you know, the the Call of Duty community has been incredibly supportive of this. We've raised tens of millions of dollars Yeah. Over the years for this cause. And it's been a huge huge part Yeah. Of the engine. We also raised funds by partnership with other companies Sure. Other companies that help us. Like, right now, pilot company, pilot travel centers. Yeah. They're running a a round up for for the last month Sure. That's really important to us. USAA has been an incredible partner sponsoring our Code Bowl event Sure. Our annual Transatlantic Esports Competition. So those are some of the big sources Yeah. Of revenue. And then we have other foundations that like the way we do things and are and are funding our efforts

Speaker 2: as well. How how do you think about the impact of... It does feel like a, you know, a $100 into the foundation could help drive millions of dollars of lifetime earnings. Like it's really hard to like quantify but it but it like this like pretty like wild dollars in versus like sort of like net impact.

Speaker 3: Yeah. I love to talk about this. And one other thing I have to say is like we we've been... Our model... So so it all begins with getting the impact model. Right? Because if you can't deliver those results, no one was gonna... No one should give you the money, in my opinion. Mhmm. And I think that's where a lot of nonprofits fall off. So Deloitte was critical to us and still is today in helping us find the high performing nonprofits. And we've got a whole process. That's really was our hockey stick moment. Mhmm. We implemented this process for finding and evaluating and and and holding accountable these organizations. That's what's enabled us to get where we are, where our last year, every $686 placed a veteran in a job. That's one fourteenth the cost per placement, one fourteenth of the federal government's efforts. Yeah. And the results, double the salaries, more than double the starting salaries Wow. And 40% greater twelve month retention rates. Yes. So better jobs, higher quality jobs, much much cheaper. And for the last three years, we've placed more vets in jobs than the federal government has. Yes. So... Wow. Yeah. And so

Speaker 1: our... Gong? Of course. Yeah. Let's...

Speaker 2: Written the Gong for you. That's an incredible stat. Alright. Thanks.

Speaker 1: I love it. Kind of

Speaker 3: the opposite of the Gong show when I was a kid. Exactly. So cumulatively, that's a 180,000 bets we've placed in jobs so far. Wow. Insane. So... And I say we, it's our grantees. It's the

Speaker 1: organization's fund. Structurally, when you walk into the office, what what does the team look like? Does it look like a like a venture capital fund essentially where you have a... Maybe some accounting back office but a lot of people that are are evaluating effectively founders of nonprofits or...

Speaker 2: If you couldn't tell, we think of everything as venture capitals as people in our best...

Speaker 3: No. No. No. This is great.

Speaker 2: No. But yeah, you are... You're basically a capital allocator.

Speaker 3: Honestly, when I when I first... We first started this work, the way we build it was it's a light venture philanthropy

Speaker 1: model. Sure.

Speaker 3: Yeah. So you know, it's all about performance.

Speaker 1: Yeah. You're looking at return on investment but through a different lens but it's still the same economic analysis. Yeah. Still business. Thinking.

Speaker 3: When we started, our cost per placement before we put the system in place was on par with the federal government. Yeah. So just like today they're 14 times more expensive.

Speaker 1: Yeah. So thousands and thousands of dollars.

Speaker 3: Like accountability, accountability, accountability. Yeah. But the model itself, this vetting model

Speaker 1: Yeah.

Speaker 3: Is what's made all the difference. Mhmm. In in many ways, it'll look like that. So we have an open application process Mhmm. Just like a VC firm. You know, you can you can try and get in And have a very strict criteria. It's about the application is like a page and a quarter long

Speaker 1: Yeah.

Speaker 3: But it's very metrics oriented. And then we go back and check with Deloitte. We partner and they go in to check, hey, were they truthful about what they said? We do really four things. We check performance metrics. We do background checks on their key leadership. We do financial checks, so past finances, current finances, and future financial health. And finally, policies and procedures. Are they following the law? Are they taking good care of their Those four things made all the difference in the world. Yeah. So we have a theory of the case just like any VC firm would, you know, like we have a vetting model, we have criteria and that's that's what gave us the hockey stick was applying that. Yeah. Then on a quarterly basis, we hold our grantees. So once they pass that vetting Sure. They're in the family. Yeah. And we fund them. But we fund them with very specific goals. And every quarter we check to see if they're on track. If they're not, we analyze, we have a conversation, we try to provide help to get them back on track. But at end of the year, if they're not on track, we don't fund them anymore. Mhmm. We move on to someone else. Yeah. And that's... It's it's accountability. And it... You know, it's accountability results. And this is the thing, I get in an argument a lot with about something called trust based philanthropy. So other people give lots of money to nonprofits. There's a school of thought which is write them a big check and get that out of the way. You don't know their business, they know their business. The data shows that does not work. Mhmm. Our data shows when we have accountability, you get performance. Mhmm. Everybody gets better.

Speaker 1: Yeah.

Speaker 3: And it's not, you know, you gotta be tough minded and warm hearted in this business. Yeah. Not just warm hearted.

Speaker 2: No. But focus on focus on the... You're warm hearted about the mission. Absolutely. Nothing else. Nothing else. Like like what's the... What grown ups

Speaker 3: kid? My dad was unemployed for four years. For for a young man, you know, preteen teen, that's devastating. Like, I know what what unemployment does to a family. Yeah. I don't want any any other veteran. I don't want anyone to experience it, but particularly... My dad was a veteran. He experienced this and no one helped him. So, you know, I don't want others to experience it. So it's personal to me. So that's the warm hearted. And I also have an understanding of the value of what different veteran experiences bring to the civilian workforce.

Speaker 2: Yeah.

Speaker 3: Yeah. And it's it's a crying shame. All the training, all the experience that we throw out the window. One example, half of veterans who are corpsmen or medics... Corpsmen is the Navy and Marine Corps version of a medic. Mhmm. They all go through the same training. Incredibly trained, experienced people. Half of them who want to work in healthcare can't get jobs in healthcare. And health care booming.

Speaker 1: There's the hiring is only place. There's tons of people that are going to... We need healthcare. Or

Speaker 3: if you talk about skilled trades. Veterans consistently do better in skilled trades. But there aren't great, still not great pipelines directly.

Speaker 1: Yeah.

Speaker 3: The jobs pay well, there's enormous need.

Speaker 2: Yeah. Yeah. Was gonna ask what trends you're seeing. We've we've talked to literally hundreds of entrepreneurs building in defense tech Oh yeah. You know hardware manufacturing aerospace all these things. I feel like hopefully a lot of those venture dollars are are flowing towards veterans. At least the founders that I know in those categories would all be excited to hire veterans just because...

Speaker 3: Have them give me a call, please. Yeah. They're not. They're not flowing that way enough. I mean, I'll give you an example. I talked with a manager, I'll just say from a major defense shipbuilding who managed a lot of welders. Yeah. And he's... He said, you know, today it takes three to four times as long to build an aircraft carrier.

Speaker 1: Mhmm.

Speaker 3: And the design's different, but not radically different. And why is that? He goes, I walk around and half my job is waking people up who are asleep in the space or on their phones,

Speaker 2: who are

Speaker 3: supposed to be welding. They're not motivated to do their jobs. Wow. Can't fire them because what are you gonna... Who are gonna replace them with?

Speaker 1: Sure. Sure.

Speaker 3: What you need is a motivated Yeah. You know, talented workforce who gets why this is important, who gets why Yeah. You know, has to be done fast and it has to be done right because lives depend on this.

Speaker 2: Who's... Who's... We're gonna we're gonna pull together... We'll pull together a list of like 200 of our former guests and you can look through if you want to meet any of them. We'll just make the to the grantees. Yes, please. Because they're all they're all hiring like in a bunch of different domains. Yeah.

Speaker 3: It's a great talent base. We we just need to help them tap into it.

Speaker 1: Yeah. What's... What does the next ten years look like for the organization?

Speaker 3: Well, right now we're on a goal of 200,000 placements. So Okay. I've always wanted to get to that moment where we place more veterans than there are in the United States Marine Corps

Speaker 1: Yeah.

Speaker 3: And we're almost there. So that's a big number. Right?

Speaker 1: Mhmm.

Speaker 3: But we're gonna keep pushing ahead. You know, support vets in in The US and The UK as The UK... A lot of folks don't realize this. There's essentially no VA in The UK. Oh, interesting. British veterans have a lot more challenges. Sure. And and a lot less support.

Speaker 1: Mhmm.

Speaker 3: So our our work there is really important. We've we've been there for I think about seven years now. Mhmm. So we'll continue to do that. That's the plan.

Speaker 2: Mhmm.

Speaker 3: And, you know, I think the skilled trades, like we we we have to do a better job of matching supply and demand. The skilled trades in not just data centers, but shipyards and other places like that Yeah. Plus the aging workforce in that area, plus the fact that these are high high quality jobs. Yeah. It's just such a good opportunity, and we just wanna get a lot more aggressive about that.

Speaker 1: Yeah. I mean, feels like the the the stars are fortunately aligning. I mean, we talk to people every day that are hiring in these exact roles that you described. So I'm very optimistic for everything you're doing.

Speaker 3: Oh, thanks. I mean, we are too. And the thing that I'm very excited about right now is, as you can imagine, we're very efficiency focused. Yeah. Right? So we care about cost per placement a lot, but we also care about quality of placement. Yeah. Average starting salary. Is the veteran in the job six months, twelve months, three years later Yeah. Enter these full time roles. So when we say high quality job, it's not a throwaway term. Those are literally the metrics we we get there. The the fundamental unit to being successful here are job counselors. You know, it's the person who takes this veteran who's a infantryman and says, I'm just a door kicker, and gets them to the point where they can articulate to a hiring manager why they're valuable to them, because they've led a small team in a tough environment. They've been responsible for a lot of equipment, for training...

Speaker 1: And they picked doors. Yeah. I just want a door kicker on stuff. Think we got to talk

Speaker 2: to you

Speaker 1: about the center of the center structure. Door kicker. Hire the infantry. We'll teach you the email stuff, but if we need to kick a door...

Speaker 3: Absolutely. But the counselor is key to that,

Speaker 1: right?

Speaker 3: Because they've been there, they can call their b s if they need to Yeah. They can build their confidence Totally. If they need to. Yeah. Can tell them why their skills will be out. It's incredible to watch these people who have every reason to be confident Yeah. To to lose it. So the really neat thing here, once in a generation, maybe more, is the impact AI can have here. Yeah. And unfortunately, a lot of the conversation in amongst the funder world about this has been all about the risks, you know. But no no real serious conversation about the upside. I'll argue that nonprofits have far more upside with AI than commercial entities. And here's why. Investors, you know, especially public companies, it's all about EPS. It's all about earnings per share. Right?

Speaker 2: Yeah.

Speaker 3: And you know, invariably that comes back to cutting costs, you know. Obviously, increasing revenue, but but in... And so there's demand for that. There's always demand for efficiencies. In my thirteen years of doing this, I've never ever heard a funder say, I want to spend less money. What they've said is, I want more impact for my money.

Speaker 2: Yeah.

Speaker 3: So I don't want a single counselor laid off because of AI. I want that counselor freed up to do more of the work they signed up for, more one on one time with veterans.

Speaker 2: Mhmm.

Speaker 3: So they... We we think we can take hours out of their day by helping with resume creation, LinkedIn profile creation, resume versioning, cover letter creation, inner unlimited interview practice. You might be able to do interview practice once Yeah. Or twice with a client. Now we can create through a you know agentic, can create unlimited reps Sure. To get really good at this.

Speaker 1: Yeah. Yeah.

Speaker 3: We can create data lakes from the resumes that these nonprofits created that succeeded correlated to results and know what works to create even better resumes.

Speaker 1: That's great....

Speaker 2: Still have that human there that that's talking to Yes. The veteran and saying like I got you, we're gonna do this together. Not only... But tap into the sort of system that we've...

Speaker 3: But do more of the stuff that humans are good at. Yeah. So instead of spending an hour updating CRM, that's automatic now. Mhmm. You know, instead of spending three hours creating a resume, now they're spending twenty validating the resume that was created. Yeah. You know, this is good, but no one in the nonprofit world is talking about this. The incentives are different. Right? We can we can do so much. I just need to get some good partners here on the tech side to help make it happen, but I'm absolutely convinced this is gonna be transformative.

Speaker 2: Yeah. We know some people on the tech side.

Speaker 1: Is the best way to support for Call of Duty players the Valor pack that's for sale right now?

Speaker 3: Yeah. For sure. The Valor pack, I mean, it's awesome in its I own mean, I hope you support the cause but if you just want an awesome pack Yeah. It's incredible. Kyle Carpenter, the Medal of Honor recipient, this is Yeah. Based on we work with him. He was amazing to work with and so inspiring. Yeah. Lots of good reasons for the pack. Oh, there it is. Great. Amazing.

Speaker 1: Yeah. Amazing. So go check that out if you're playing Modern Warfare four. And thank you so much for coming on the show.

Speaker 3: Thanks for having me.

Speaker 2: Dude, an amazing story and

Speaker 1: Great

Speaker 2: to hang.

Speaker 1: Let me tell you about Codex. Codex is a powerful workspace for getting work done with AI agents whether you're writing code, analyzing data, creating content or automating business workflows, Codex helps you move projects forward from start to finish. I believe our next guest is with us in the waiting room right now. We'll bring him in to the TBPN UltraDome. We have Darren Farber from Albion River. You've heard him on Best Like the Best and now he's here with us on TBPN. What's going on? How are you doing, Darren? Hi, guys. Hi. Thank you so much for taking the time to join us. I would... I... Let's kick it off with a little bit of an introduction on yourself just get everyone familiar. And then I wanna talk about about China and everything that's going on there and how The US is engaging. But let's start with a little bit on your background.

Speaker 9: Sure. So, you know, simply my background is I'm an engineer by trade and spent the better part of a decade inside the Department of Defense as a weapons buyer, for lack of a better term, and spent three years in Iraq and two in Afghanistan doing that. And left in 2011 to work for a large family office in Chicago to build the defense business, which we ultimately sold, and then formed a private equity vehicle in 2013 to buy and improve defense businesses, primarily defense weapon system businesses. Yeah. And that's what we do today. And the the logo I have behind me is a is a new defense platform business that we have Uh-huh. Called Ignium, which is an amalgamation of about 11 brands or now 12 brands of of kind of critical componentry inside of weapon systems. So think fuses and these kinds of things.

Speaker 1: Got it. Yeah. What's the deal size? What what's the sweet spot? Are you looking for... It it doesn't sound like you're trying to be like the bending spoons of defense tech going after venture funded companies that were maybe funded just a couple years ago. It's more...

Speaker 2: Maybe in a year or

Speaker 1: so. Maybe in a year. But what what has been the strategy? What type of companies do you love to partner with most?

Speaker 9: We like to say they're... We like to own the meat and potatoes of warfare. Yep. So think... If you if you think of our portfolio, we're talking about power management for weapon systems, fuses for weapon systems, relays, targeting, kind of the building blocks that any... That would exist in any weapon system that are extensible across every weapon system. And so our view is we wanna be a kind of this permissive supplier to everyone's system at the end of the day Yeah. Because the pace of change and innovation is so great, you know, we don't know which system will ultimately be the program of record. And so our view is we should supply everyone, and we should make the pieces that need kind of large industrial Yeah. Capability, and we can drive the price lower. And so those are the businesses we wanna own. And, you know, to your to your point on deal size, you know, I have three kids. There isn't... Like, none of them are the same. Is no one deal that's the same. There's no one size that's ever the same at the end of the day. We recently bought a business for 300,000,000. We bought a business, you know, prior to that for 60,000,000.

Speaker 1: Yeah.

Speaker 9: We're in the throes of trying to buy something for 1,500,000,000 right now. So it just depends on the the underlying quality of the asset.

Speaker 1: So one thesis that we've heard from a number of newer startup founders is that that fuse business that you mentioned or that business that's doing componentry that goes all over, it's so critical to the defense industrial base. But the person that owns that business, they're getting older. The person who's on the manufacturing line, they're getting older and there's no plan for succession and that will create a crisis that's coming and we're going to lose this valuable skill in America of how to make a particular part. How real is that? How have you confronted that? How when you buy this business you have to think I assume decades in the future of how this business will continue to run and flourish. What has your strategy been for hiring and succession planning at these businesses?

Speaker 9: Sure. So I would say it's very mayoral. It depends on the nature of the business and exactly what it's manufacturing at the end of the day. I think one of the things is automation has taken a lot of, let's say, work instructions out of the process where people used to do it. Now we can, you know, bring material automation in order to the process at the end of the day. But, look, trade schools are very important. Mhmm. Spending the calories to have a a kind of a a mentor protege program

Speaker 2: Mhmm.

Speaker 9: Within these businesses are also extremely important at the end of the day. And, you know, automation can't come too soon. I'm... We know I'll be a prolific buyer of the Tesla robot for our factories at the end of the day. And look, we own bomb factories. We own a very large factory in Germany and also one in The United Kingdom that make, you know, ordinance and, you know, smoke and illumination. These are these are very dangerous factories and products at the end of the day. And so the more you can add add automation, actually, you're far better off. And so our goal is a combination of leveraging the future through automation and then making sure, like, the internals of the company have very strong mentor protege programs to bring in young people from technical and trade schools, but that's not enough. We don't have enough feedstock through that, and so it's really taking someone that maybe didn't have a hard technical skill and showing them through, you know, functionally a mentor protege program how to how to do the particular activities that we feel are are are in short supply.

Speaker 2: Yeah. So you you talked about being in procurement, but being actually deployed on on for that effort in Iraq and Afghanistan. How much time do you spend today actually, like, you spend time obsessing over battlefield footage in these in these sort of active conflict zones? Like trying to get an understanding of like what kind of componentry is gonna be more in demand in the future? Or is that... Or or can you sort of get to those conclusions in a different way?

Speaker 9: No. It's it's a very good question. Look, battlefields are the laboratories of the defense industry, and so we learn so much by these active contingencies. You know, an old battle buddy of mine who I now get the privilege of working with, is a retired two star says, plans rarely survive first contact. And I love that kind of old army saying because it's it's quite true. And so there's so much to learn in the act of contingency in the Ukrainian theater, but also there's this risk of over imputing what's happening there to say that it will happen everywhere else.

Speaker 2: Yeah.

Speaker 9: And so, you know, war is primarily a combination of old and new. It's never all old and it's never all new. And what you see in the Ukrainian contingency is, you know, a real combination of elements from World War two, like trench warfare, 155 millimeter shells, these articles, howitzers, these things that you would be familiar with in a documentary almost of of a previous generation. And the battle lines, for example, are getting resupplied through a 100% autonomous systems. So there are autonomous sleds that are delivering kinetic material to the front lines and these guys are in trenches. Right? The trenches are are... Look a little different. They're they're almost spiral and they have a deck where they sleep inside of them, but it's all dug out of dirt. And they have small caliber weapons and, you know, they may have a drone or two. But functionally, it looks like World War two in those trenches. So it's this it's this ingenious combination of old and new. And so in the new, what we look for are the extensible pieces almost of the old that will continue. So for example, we make one of the world's leading pyrotechnic cards that goes in many different types of drones. And so if an adversary were to capture your drone, they would interrogate it for signals intelligence to see what they could learn about what you're doing, pack into your network, and so you want to melt and fragment the board. And because that is a small incendiary device and needs to be made at a very specific factory, that's the kind of thing I want to make. And an incendiary device and that technology and that manufacturing process and delivering a kinetic effect, we fundamentally feel won't change over a much longer cycle. For example, fuses need to be in either autonomous systems or a drone, or they need to be in a conventional system. And so these are the businesses we like where the map of the future won't largely change even if the end using program may change kind of very quickly. We want... We wanna be in all of it. Mhmm. We wanna drive volume and scale and then drive down cost to the customer while maintaining margin. You know, an example of this is I'm still the chairman of Magpul, which is the world's largest manufacturer of firearm accessories. And so we make a 100,000 magazines a day at our factory in Cheyenne, Wyoming. So this is the Western world's largest magazine plant. We haven't raised the price of a magazine in a decade, and so we drive so much volume into that business. We've we've completely vertically integrated the business. We consume the most nylon, a particular type of nylon for that business that I can maintain margin but radically expand the TAM. And so that magazine, the generation three PMAG is used literally all over the world by every allied military, and that's our goal. We wanna make the pieces that fit into everyone's system and have enormous scale in them. We have 12,000,000 square feet of manufacturing capacity for, you know, in our in our new platform, in this platform called Dignium. That is more manufacturing square footage than any new business that's been formed for the purposes of defense in in in the last, seven to ten years. Maybe maybe there's only... Angela is the other one. Yeah. So you need lots of space. You need lots of industrial scale. But if you have lots of distribution and lots of extensibility into many platforms. Right? We make one fuse, goes into many things. Super important. We can deliver enormous value to the taxpayer and have enormous industrial capability that the country needs.

Speaker 2: Fascinating. Why why do soldiers on modern battlefields seemingly take videos of the active conflict zones and post them on social media? I would think with even sort of the obliterated models of today you could aggregate a lot of that content and use it to create like, you know, basically your enemy is... If you're the Russians it seems like your enemy... Both sides I think are doing this, but but you're effectively like delivering intelligence to your enemy which feels shortsighted, but is it, you know, people just want to... Everyone just wants to share their life online? What do you think is like happening?

Speaker 1: Yeah.

Speaker 9: No. It's a great question. I think... Look, there's there's this broader concept of information security in a networked world. Right? And how how closed off do you make people and how open do you make people. And clearly through data fusion, if there's enough videos of peep... Of, you know, soldiers on the battlefield taking videos, people could triangulate information for the purposes of targeting at the end of the day. There's also a valuable component, the the counter narrative to to at least a part of that would be the psyop, right Mhmm. Of of concerning your enemy about your capability at the end of the day. And look. The Russian signals intelligence that's been exfiltrated suggests that they are extremely concerned about the sophistication of the Ukrainian weapons, at least on FPV drones, and the American... The quality of American gear that that we've been giving them.

Speaker 1: Yeah.

Speaker 9: You know, one of the translated blocks of signals intelligence I was listening to that got declassified recently was they were so concerned about... They kept on talking about, be careful. They have American stuff down there. And so, you know, the psyop of being able to share some of this in social media. Right? The Ukrainians, for example, were doing facial recognition technology on Russian soldiers

Speaker 1: I remember.

Speaker 9: And letting their families know that they were dying on the battlefield. The Ukrainians were doing this

Speaker 1: Yeah.

Speaker 9: To to create disharmony in the environment. So there could be an element... There could be a SIOP element of it. Sure. If I was the command... If I was the CG, if I was the commanding general in the battlefield, you you know, and American military doctrine would suggest you probably don't want to give any information whatsoever.

Speaker 2: Yeah. Let me just... What role is open source AI playing on modern battlefields? I'm thinking, you know, Iran, Ukraine, etcetera.

Speaker 9: So, you know, the targeting... Many of the targeting systems, you know, have a corpus of data, and this can add to the data, but there's so much cleansing that needs to happen. I don't I don't think you... We've seen yet kind of a true integration into many aspects of warfare. I will tell you the resupply lines, in particular, that are happening in Ukraine are using... The autonomous ones are using a form of artificial intelligence to navigate the battlefield and resupply the lines. And so it's a very kind of closed and narrow mission set at the end of the day where, you know, the... You know, a a subset of AI is working very... In a very particular way, in a tasked way. But really, in in population control and the sigh up of how you engender support, right, all military action has a political motive and a political will. And so how you build that and how you engender support is actually kind of directly tied to how you farm social media, how you farm your population. There there's a lot of ways to get signals intelligence off of people's phones, for example, at the end of the day, and AI's working on that pretty aggressively. So it's it's a weird new, you know, modern trade space. And I think, you know, the participation of civilians in the activity and what they are feeding into the battle space unwittingly is kind of... Is is this is this new fulcrum of war that clearly AI is having a part. Right?

Speaker 1: Mhmm.

Speaker 9: Like, meaning, you know, forget like the Jensen Huang honeypot, which is kind of like the oldest form of of clandestine activity. Yeah. This is like, can you inadvertently get citizens to give you information on a power plant, the position of soldiers, where they're traveling on a highway for logistics and supply lines. Right? There's an interface between civilian population and military population.

Speaker 1: Yeah. We've heard about this with Tesla, the self driving and the cameras stop working when you're in China and you're near the Forbidden City or near any important military infrastructure. It just sort of goes dark and you have to drive the car yourself. And so, yeah. What what... We've seen some work on DJI drones where, okay, there's a... You know, you can't fly them in, you know, national parks but you also probably can't fly them next to...

Speaker 2: Have you seen a softening in venture investment in defense over the last call it six months?

Speaker 9: I haven't... So I'm not a venture investor.

Speaker 2: No. Know. Know. I know. But I imagine you like... Or or it's quite interesting to you watching a bunch of relatively novice defense, know, investors enter a category in which they are far from experts in, and you happen to be an expert. And so I imagine when you see a $100,000,000 go into a company, you you have pretty strong opinions on it regardless of kind of what exactly it's doing.

Speaker 9: Sure. So look, I'm not going to take the full bait there,

Speaker 1: but at the end of

Speaker 9: the day, because I think it's a... I've been in this industry for pretty much my entire career. Right? I'm I'm 49. I started in my twenties. And I remember defense conferences were like a bad piece of meat and a baked potato when everyone looked a 100 years old. And today, it's, you know, it's a it's a lot of young and dynamic people. And I always ask myself, why is the provenance of new technology almost exclusively to the young? It's the same reason we put 18 year olds on the frontline infantry. They are unafraid. And so we need these young people in the system. Right? If you think about, you know, prior to the Berlin Wall coming down, two thirds of the world's scientists worked in defense. And kind of immediately after that, when we no longer had a pacing threat, these scientists went into every other field. And I don't think it's a coincidence that we had a a revolution in compute technology and biotech. You know, all these new things started to flourish. We got an Internet revolution. We got all these great things. And so I like seeing the activity and the young people come back in and venture makes that possible. It it it becomes a sufficient carrot for folks to come back in. As to whether or not the investments will be meritorious, you know, it remains to be seen. There are some valuations that are, you know, kind of spectacular and and, you know, to your point, I I I probably don't understand them necessarily at the end of the day, but it's drawing in a whole caliber of people that we desperately need instead of working on the next app or going to Wall Street. We need these technical abilities to come into the industry. And so my hope is that the reversion to the mean here isn't too much of a whipsaw, and we get a few high quality companies that can... That come out of this, that can that can act as a training ground for the next great set of technical leaders that are interested in defending the nation.

Speaker 1: Yeah.

Speaker 9: But, you know, there has been a decoupling between let's say...

Speaker 1: Some of the relations, yeah.

Speaker 9: Yes. You know, the the...

Speaker 1: Ben Thompson...

Speaker 2: Yeah. Overall I ask I ask because I think, you know, venture capitalists do incredible things. I think it will be an enormous net positive that there was billions and billions of dollars pushed into these categories even at prices that are disconnected from valuations you would typically see for these kind of businesses. So I think it's an enormous net positive. I also think like VCs can be fair weather sort of friends where like I would expect there to be a pretty significant pullback at at some point. So I was just wondering if you were if you were seeing that. But but that all makes sense.

Speaker 9: It hasn't happened yet. Right? And, you know, if, you know, if and when it does happen at the end of the day, my hope is is that the carnage isn't so material that we we permanently flush out all this talent that we need to stay in the system. Right? That we desperately need to stay in the system. So I'm hopeful. And look, if you can... You know, I I think of the SpaceX IPO as papering over a lot of portfolios. Mhmm. And the success of that, I actually believe will kind of, you know, put this into extra innings if you will. Yeah. Because it seems like, you know, that piece of equity was nearly in everyone's portfolio.

Speaker 1: Yeah.

Speaker 9: And so, you know, maybe that will keep the system going for longer at the end of the day. But there needs to be exit and return here, and that will that will keep the wheels in motion. And if there isn't, it will stall out ultimately.

Speaker 1: Yeah. Yeah. I've always thought that even if there's there's like there's knock on benefits of bubbles. I mean, even in the dot com bubble, we got dark fiber. If we build a lot of energy infrastructure or we have hard tech companies that are buying CNC machines, training people, whether the equity value accrues in one portfolio or another, you're still actually re industrializing. You're putting machines on the ground in buildings, training people to use them and that's valuable to The US economy.

Speaker 2: Last question, I know we're way over, so apologies, but where, like, I imagine you see opportunities that a venture backed company might pursue that could be well suited to an existing portfolio company of yours because maybe we're not looking at for some of these categories maybe we're not looking at like five to six years of really hardcore R and D and it's much more of a hey there's a fifty to a hundred million dollar annual revenue you know product here but we can just use an existing company. Like I imagine like if Magpul is as an example I know that's not I know I know it's a board position for you but if they can make a 100,000 magazines a day, I would be pretty optimistic that they can make a $100,000 of like some drone componentry which feels like that we capability that we want as a nation. Mhmm.

Speaker 9: Right. Yeah. So you... Yeah. Magpul makes like a 100,000 units a day. Yeah. That's a lot. So it's it's a it's a lot of units. But look, We are capable of so much as a country. Right? If you think about what we did in the a bomb project, it was it was like 200 basis points to 300 basis points of GDP Yeah. That one project. And so if the country decides that this is important Yeah. You know, hang on because, you know, we'll take a whole part of the Nevada Desert or something, and we will build a multi million square foot factory to pump it out. There is... One of the challenges in drones is it is a dual use technology

Speaker 1: Mhmm.

Speaker 9: With low cost providers in the system at the end of the day. Yep. And so I always say in a dual use technology, you better ensure that you're the commercial leader

Speaker 1: Yep.

Speaker 9: Right, outside of the department. Because ultimately, one day, it will come to eat your bacon if you're only focused on the Department of Defense. And so that's why the products that we buy are exclusively defense products.

Speaker 1: Mhmm.

Speaker 9: Right? Unless I have a clear path to be the commercial world leader.

Speaker 1: Yeah.

Speaker 9: Right? There aren't specialty products in the department for things like databases. Amazon runs a huge part of CIA today. Yeah. So it's like, it's not that, you know, we're not making special custom products as much anymore for the department for for anything dual use, quite frankly. We wanna use commercial off the shelf. And so in the drone... In the fulcrum of drones, like, guys, we've had drones since the Vietnam War, but what made them popular and permissive in this theater of war is they are cheap and they are... Are commercially available. That was the changing architecture of war. And so if we need a blue supply chain, then we have to have a view on how that blue supply chain becomes also a commercial world leader in order to withstand the invariable shrinking of a defense budget and choose your number of years.

Speaker 2: Yeah. That makes sense. Makes total sense. Well, this was great. Maybe... I wish we had more time.

Speaker 1: Maybe zipline. Zipline's pretty dominant in commercial drones. They're getting there. I I I feel like if if we need the technology is emerging. It's not just...

Speaker 2: And thank you for your service.

Speaker 1: Yeah. Thank you for your service and Happy Veterans

Speaker 7: Day.

Speaker 9: Thanks, guys. Happy Veterans Day. Thanks to all the veterans and

Speaker 2: Yes.

Speaker 9: You know, to double back on your previous guest. Third Option Foundation is a dedicated foundation to the paramilitary activity at CIA, does wonderful work. Then also Objective Zero, which works to prevent veteran suicide, both wonderful charities. Both that I'm proud to support. Happy Veterans Day to everyone.

Speaker 2: Thank you, Darren....

Speaker 1: Coming on. Have a great day.

Speaker 2: See you again soon.

Speaker 1: Guys. Talk to you soon. Cheers. Goodbye. Let me tell you about Shopify. Shopify grows with e commerce. It's the commerce platform that grows with your business. It lets you sell in seconds online, in store, on mobile, on social, on marketplaces and now with AI agents. And we have our last guest of the show, Walter Goodwin, the founder and CEO of Fractile, bringing him in to the TBPN. For keeping you waiting, There he is. We're running a little late today, but thank you so much for coming on on such a big day. Congratulations. How are you doing?

Speaker 7: It's it's great to see you. Yeah. We're all having a fun time here at Fractile. Yes. Fractile's been on this mission for four years now and things things things are going pretty well. So it's been an exciting day getting to announce a little bit more about what we've been doing as well.

Speaker 1: $720,000,000 raised. Is that a Tony Hawk's Pro Skater reference?

Speaker 7: It's... We did we did $2.20 before. So, yeah, hopefully, we can go for what's next? $10.80? Yeah. Could do a 900 and

Speaker 1: with $12.60, McTwist, something fun. Yeah. Take us through what what the money is for. Is this is this all... Do you need this money to put down your first order? Are you still in r and d? Introduce the company. Tell us about the strategy.

Speaker 7: Definitely. So Fractal is... We're a chip company. We've been building chips to run the world's largest models faster, orders of magnitude faster if we get this right than any other chip on the planet. And this is a pretty full stack endeavor, so you have to do custom silicon, custom software, you have to build these kinda huge power hungry racks as well that these chips go into. Mhmm. And, yeah, the capital lets us do a lot of this faster. It lets us paralyze a bunch of things as well. You know, we're heading into a world where if you wanna, you know, secure capacity on production that you might be doing in the second half of next year, even the first half of twenty twenty eight, you know, you've gotta move today. And so, you know, we're already walking factory floors. We're already thinking about kind of, you know, where that production even in the second half of twenty twenty eight might be built. And so this is really where kinda having capital today. Let's just do things a little bit faster. And then, obviously, it lets us expand what is, you know, already an incredible team. And, you know, we're building a team kind of pretty globally, you know, in in The States, in The UK, in Taiwan. So it's exciting to be able to do a bit more of that as well.

Speaker 1: How much are you in the camp of, like, we are at the end of history in terms of architecture, how bitter lesson pilled are you Yeah. How much of a transformer, you know, absolutist are you?

Speaker 7: Yeah. Great question. Yeah. You know, I think there's two ways. If you... You're crazy enough to see a, you know, $4,000,000,000,000 incumbent and say, you know, we should we should challenge this space. Mhmm. There's sort of two ways you go after it. Right? And one is hyper specialization and you're like, right. Is it... Know, think it's gonna be this workload and it's gonna be this workload forever and we're gonna bake that into the chip. I think that's pretty tricky. You know, chips take a long time to build. Mhmm. Even if we can start designing them in, you know, weeks other than years as, you know, AGI comes and kinda holds a pen for us at all, they take months to get through the fab. And then you have to ramp that production. Your end customer has to find that rack useful for three to five years or the CFO is gonna like blow a fuse because it has to be amortized over that period. And so you can't actually specialize without imposing a bunch of risks. And so kind of the other...

Speaker 1: And that's... That's...

Speaker 2: And that that clearly was a very popular pitch like you know over the last 10... The specialization right when you think about you know Cerebras and and Grok and some of these other players and like maybe you needed to do that at that point to to have a compelling pitch of like, well it didn't feel like things were... It did like certainly you know eight years ago it didn't like feel like things were moving so fast and so the specialization pitch maybe was like landing a bit better and then now investors it feels like have like not a lot of faith that like the the thing that you decided to specialize on four years ago is like the right thing for the next Right. Four years.

Speaker 7: Right. So I think now we see, you know, and with the benefit of that hindsight, there are some things that are sticky and predictable. Models of whatever shape and size will keep getting bigger. They seem to be increasingly hungry for a particular thing that you can design your chips around, which is more bandwidth to memory, the ability to load weights from memory faster, the ability to load today, you know, state, the KV caches that power these models from memory faster. And that's the kind of thing where if you can find a way to build a chip that's, you know, in some way a lot better than something else that is out there, but is placing a bet on a kind of... It's almost like a macro property rather than a micro property. You know, Fractile's big focus over the last couple of years has been, I guess, this sort of secret project, which we're now sharing a little more about to take memory. So this DRAM memory that everybody knows is in, you know, acute shortage today. And rather than having it as like a separate piece of silicon, this is what every single chip today looks like. You've got the kind of processor that's running math and then you have this DRAM memory, HBM memory that's off to the side. Rather than having it like that, we stack it on top. Mhmm. And by doing that and then rearchitecting various things, you have this this huge increase in bandwidth, which translates to a huge increase in speed. You know, on this first gen chip, we're projecting 20 times more bandwidth than you would get to HBM on a on a on a GPU or XPU.

Speaker 1: Mhmm.

Speaker 7: And that doesn't have to be... It's a, you know, it's a bet that is sort of informed by the workloads, but it doesn't have to be kinda hyper specialized. You know, we sort of see all sorts of potential futures where this remains a kind of key, you know, uplifting capability. And so I think, you know, long term, some bitter lesson stuff like stuff scales, things are getting bigger, memory bandwidth requirements are getting higher. What you don't wanna do is kinda build a chip that's the exact kinda shape and size of the network that you're going after because by the time you've even sort of, you know, told the next person about it, you've already you know, the world's already moved on.

Speaker 2: Makes sense. Anthropics IPO materials imply that chips will be a commodity. Is that okay? Can you still build, you know, a trillion dollar business in that in that world? I I can I can make the argument that that you can, but I'm curious your view?

Speaker 7: Yeah. You know, I think I think what becomes more of a commodity is what it looks like to squeeze the best possible performance out of any given chip. Right? And so, you know, I think to some extent, this is a a huge gift to challenges, companies like us that the... You know, I think in those IPO materials, Anthropic said, you know, it used to take six to twelve months to get a workload to run on a new chip that we'd onboard. With the most recent chip we did, this took us three days. Yeah. And so what you start to see is when you look at the chip, in the end actually, one of the only things that kinda matters is, you know, has it got that set of bets right? Has it not been too opinionated? It's still useful for the workload. And then... And does it have some, like, fundamental uplifting property that means that it is just always gonna be better once I throw my model at optimizing, you know, optimizing something for it. And I think that's kind of where we've where we've focused is, you know, some of the kind of more unusual stuff that we do at Fractile is the sort of pavement pounding of constant flights out to to Taiwan to East Asia, working with the supply chain to build sort of these like fundamentally new building blocks. You know, when we started doing DRAM stacking, it felt like nobody else was was doing anything that looks like this. We still think what we're doing, nobody else is doing anything like this. And once you kinda crack that building block, you can then deploy it. And so I think, know, in some sense bring on the commoditization because what it means is you can juice so much more from these kinda core advantages. I think they come through more.

Speaker 3: How are you

Speaker 1: thinking about cyber security? I imagine that you have ongoing conversations with the big labs about selling the product. But are you are you interested or able to get access to cyber security models early because we've been hearing like rumbles about what if there's a p two p p two p to shell like flaw in a CPU or a GPU. Right. Right. And that feels like really really important thing to get right. I'm sure you're taking it seriously, but what has the nature of the process been like for you?

Speaker 7: Yeah. So I think two two separate things on that, you know, one is we are in a scary time. And I think this scary time sees chips become in some ways sort of, you know, our schools of defense. Right? Yeah. We we need to... You know, if you go to the hugging face attack, you know, it's the kind of somewhat heroic tale of defense.

Speaker 1: Right?

Speaker 7: You spin up another model and you use that to fight the agent that is is trying to hack into you. And Yeah. In these kind of... In in these adversarial games, any asymmetric advantage, we see this in anything that looks like this, is a is a huge advantage. Right? And so something like speed, which is what we're delivering, you know, the ability to take a Frontier model and run it 20 times faster than anything else can becomes completely vital to that kind of counter defense. And we don't yet know how kind of asymmetric asymmetric this ends up being. You know, we may really need to have that speed in order to keep ourselves safe. So I think that's a... You know, that's something which we now see ourselves as sort of, you know, potentially quite a vital part of in future. You know, another part of that is, you know, this sort of test time compute scaling, right, is such a core part of capabilities today. The longer I run a model, the more it can do. And to to some extent, if I'm a bad actor, I'm willing to wait. Right? I'm willing to wait six months to have this thing crack into... Know, if you look at the AI Safety Institute, you know, based out of The UK, they have this cybersecurity benchmark, and I think it was Mythos was the first one to crack it. Mhmm. And it got there by generating a 100,000,000 tokens. Yeah. And if you're generating a 100,000,000 tokens at 50 tokens per second on a GPU, it takes twenty three days. Yeah. But if you're doing that at 1,500 tokens, you know, it's kind of like the work of a working day. And so speed and the speed of the chips we have in serving these models kind of becomes the core factor. And and a scary thing is that labs are having to release models that they haven't necessarily had enough time because there's never enough time

Speaker 2: Yeah.

Speaker 7: To play all the way to the end. You know, what does it look like if I'm belligerent enough that I'm gonna wait for this frontier model to run for kinda six months to go do something? And so you also wanna be able to kind of compress that red teaming cycle by running on faster hardware, for example. Yeah. On the safety side at the hardware level, you know, there's this whole world of formal verification Yeah. Which, you know, like, has always been the preserve of kind of like the the brainiest people, you know, in any team on software and hardware. We're seeing huge returns now to leveraging AI to do that. And I think it's a very key part of how we, you know, basically squash all of the bugs, safety bugs in any hardware.

Speaker 1: I love it. Well, congratulations, Jordan. Do you have anything else? Gong. I wanna hit the Gong.

Speaker 2: And... And...

Speaker 1: You really had to scrape the couch cushions to get this round done. Did anyone did anyone like big come into Any this

Speaker 7: have Thrive. Night speed, red point behind us, bud.

Speaker 1: Burners round.

Speaker 2: Capital g. UK sovereign fund. The government. The British business bank too. Wow. That's an elite line on the cap table.

Speaker 1: Killer roster. I'm so happy that you have great partners for this project. It's so important. So thank you so much for coming on the show.

Speaker 2: Yeah. Thanks for breaking it down. Really impressive progress.

Speaker 7: Thanks so much. Thanks very much.

Speaker 1: Hopefully, talk

Speaker 2: to Cheers to the team.

Speaker 1: Have a good weekend. Week. It's not the weekend

Speaker 2: yet. I'm

Speaker 1: going to bed.

Speaker 2: This guy needs a nap.

Speaker 1: Let me tell you about Figma. Agents meet the canvas. Your AI agents can now create and modify your Figma files with design system context and let me tell you about the New York Stock Exchange. Wanna change the world? Raise capital at the New York Stock Exchange. Is there anything in the timeline that's urgent? Breaking news? Anything we need to talk about before we wrap this Veterans Day show on 11/11/2026. Jordy, did we get to the bottom of hobbies? I think we defined it pretty well. It's a hobby

Speaker 2: I think we nailed it down.

Speaker 1: The guy knows your name at the store that sells the stuff for the hobby, then it's a hobby. Otherwise, you're casual. Right? You agree?

Speaker 2: I think that's, you know, given the the decline of the significance of physical retail, I think there's a lot of arguments against that point.

Speaker 1: If you're getting retargeted constantly by the e commerce website Yes. I imagine that the surf shop in Malibu, they know your name. No? Yes. I think so.

Speaker 7: Yes.

Speaker 1: Anyway, thank you for tuning into TBPN. We'll see you tomorrow. Hopefully, we're feeling better. We'll be back no matter what at 11AM Pacific. Leave us five stars on Apple Podcast and Spotify. Sign up for our newsletter at tvpn.com.

Speaker 2: And in honor of Call of Duty Foundation Yes. Which you can support in the game Yes. By buying... The Valor Pack or you just go give

Speaker 1: directly. Never normally been a skins guy. I just sort of play the game for fun. I am a casual. I would not call it a hobby. But now...

Speaker 2: I went to the Call of Duty office....

Speaker 1: Know my name so I guess I'm going to be a hobbyist. Blue ball. But I'm definitely getting the code pack. Call of Endowment. See you tomorrow. Bye.