This Week in Startups
00:37:37 · D.A. Wallach
[00:37:37] S2: look like an idiot. So I'm sure Jim Chanos or whoever else will be shorting all this stuff, but, like, they're probably gonna have a lot of egg on their face. I think where it gets interesting is when you start asking these questions about long term defensibility, about long term profitability. And I look at something like Figma and I go, okay, everyone thought they were gonna have their lunch eaten by Claude Design six months ago. Well, it turns out they have network effects. Turns out graphic designers still do better graphics work for real companies than OpenAI or Gemini does. Now they're amazing tools. They're gonna progressively eat more and more of that workflow. But like, you know, 10 designers at a company are all used to using Figma to collaborate with each other. It's what they've trained themselves up on over the last decade and they love it. That's a product people love. So, you know, I I... I'm not counting anyone out yet. And I think the questions we were getting at earlier around the defensibility of of Anthropic and the others, those are fascinating business questions, but they're gonna play out over a longer horizon. You know? I mean, the thing I don't like about being Anthropic right now is every person in the world has a huge financial incentive to figure out how to compete with your product cheaper. Okay? Everybody... Like, it's the biggest pot of gold in human history is to figure out how to offer intelligence for free right now. So, you know, I don't like the idea of having that target on my back. Now, would I trade places? Sure. Because they're on top of the world right now. But it's not gonna be easy. And I think for those guys, one of the other interesting challenges is and this is a credit to them, they're not commercial. You know? Like like Dario and the Anthropic cofounders in
00:39:19 · Dave McClure, D.A. Wallach, S0
[00:39:19] S3: Wait. Particular They're not commercial. [00:39:21] S2: They're in this for the money. Like, I I really believe that. They they are they are full rule... Everyone around... Okay. [00:39:28] S0: Hold on. This is good. D. A. Finish. Hold on. D. A. Finish and then Dave. So finish your finish your thought of why they're not commercial, then Dave, you get to counter. Go. [00:39:37] S2: For for all of us craven capital capitalists, it is it is it is it's a it's a it is a reflection of our psychology that we cannot imagine that Dario is being genuine. Okay? It's it's impossible for Chamath to listen to Dario and not see regulatory capture, venality, scam artistry. Okay? But Chamath and Don could [00:40:01] S3: be further opposed on the spectrum. [00:40:03] S2: Read. The opposite. [00:40:04] S0: Hold on, Dave. Let him finish, then you get your My, please. [00:40:07] S2: These guys, as they are chain smoking their cigarettes, are are are showing you that they are religious extremists. Okay? These are dyed in the wool legitimate religious extremists, and they might be right. And if they're right, we should we should thank them because they're saving civilization. But if they're wrong, they're just religious extremists who happen to be engaged in the greatest business of this moment, but they will ultimately be beaten by people who are really good at business,
00:40:07 · D.A. Wallach, S0, Dave McClure
[00:40:07] S2: These guys, as they are chain smoking their cigarettes, are are are showing you that they are religious extremists. Okay? These are dyed in the wool legitimate religious extremists, and they might be right. And if they're right, we should we should thank them because they're saving civilization. But if they're wrong, they're just religious extremists who happen to be engaged in the greatest business of this moment, but they will ultimately be beaten by people who are really good at business, [00:40:41] S0: which you don't see for religious and cult leaders often. I think Scientology had it for, like, a decade maybe where they were surging in growth and surging in revenue and they had the tech and it it... They couldn't sustain it. Right? But this is a I mean, this weird. With performance. I mean, not since Christianity have we seen this. I mean, Jesus was on all cylinders objectively. [00:41:06] S2: You know, by the way, they... Jensen [00:41:08] S0: why they took him out. [00:41:09] S2: GPUs. Jensen doing GPUs fifteen years ago did not know he was gonna end up in this position Right. In this revolution. [00:41:17] S0: He didn't know he was GPU Jesus. [00:41:20] S3: No. He was No.
00:41:20 · Dave McClure, D.A. Wallach, S0, Lon Harris
[00:41:20] S3: No. He was No. [00:41:22] S2: Dario, studying physics at Caltech, did not know he was gonna be building the expertise that would put him in the middle of the great economic revolution of our time. So these guys, to a certain extent, are... They had prepared minds, but they're here accidentally almost. And the the folks who are competing with them are... The folks who are competing with them, Zac, Satya, they are not here by accident. [00:41:44] S0: No. Those are They are here for the money. Capitalists. [00:41:47] S2: Yes. These are for the money, and they're really good at the tech too. [00:41:50] S0: And Sam Altman would fall into that category. Dave? Okay. Now you've heard his decision, and you get to that. Go ahead. [00:41:57] S3: Alright. I I think that D. A. Was doing his best, David Sachs impression there, channeling your bestie, Jason, and my former [00:42:05] S1: No. [00:42:05] S0: I don't think I've ever heard Sachs take that position exactly. [00:42:08] S3: Hardly never. [00:42:10] S0: No, no, think he thinks they are religious zealots, etcetera, and they're going after regulatory capture. I think what D. A. Is saying is they're not going after regulatory capture because their business cutthroats. They believe what they're saying. They believe it to the same extent that they will cut themselves believing that they're gonna naturally heal from AI. They'll they'll rip darts knowing that.
00:42:10 · S0, Dave McClure, Ben Black
[00:42:10] S0: No, no, think he thinks they are religious zealots, etcetera, and they're going after regulatory capture. I think what D. A. Is saying is they're not going after regulatory capture because their business cutthroats. They believe what they're saying. They believe it to the same extent that they will cut themselves believing that they're gonna naturally heal from AI. They'll they'll rip darts knowing that. [00:42:36] S3: You you can be a believer in the benevolence and godhood, deity of AI and also be interested in making money. I actually do agree that Dario maybe isn't in it for the money exclusively. I I... Know, Machines of Loving Grace and all that other shit aside, I think he believes it. I really do think that he's trying to birth a deity that is a benevolent deity and will save humanity. I fully believe he believes that. He also probably is okay with making money. Now he made a bunch of money at Google before he got to Anthropic. But I I think that Sam is in a different category. I I think Sam is, you know, a venture capitalist and has a lot of ambition, probably more in the mold of Elon than than Dario. But, like, all these people working at AI companies, yes, they may be there to change the world. They're also probably fine with making money. So those two things are not mutually exclusive in my book. [00:43:33] S0: Okay, Ben. You wanna get you wanna get in here, Russell Crowe? Go ahead. Go ahead, Gladys. Oh, yeah. [00:43:38] S4: You know, look. I say, like, I don't wanna listen to what people say. I I wanna look look what they do. Alright?
00:43:38 · Ben Black, S0, Dave McClure, D.A. Wallach
[00:43:38] S4: You know, look. I say, like, I don't wanna listen to what people say. I I wanna look look what they do. Alright? [00:43:44] S0: How many darts did you rip before this [00:43:48] S4: It's a [00:43:49] S0: Russell Crowe smoking darts in between takes on, Gladiator. Go ahead. [00:43:54] S4: Yeah. I I remember remember... One part of this business we haven't talked about at all is the cost of compute and all these long term and how important that go... Goes into the actual sort of fee... Like long term business model here. And, yeah, I have to remember Dario giving a very public scolding to Sam Altman for being irresponsible about all of his compute deals. Yes. Because Sam almost like [00:44:17] S0: Pull up that cliff, guys. It's when he said you can run off a cliff. Basically, you buy too much compute, you go bankrupt. It's the [00:44:23] S3: No love lost between those two folks at all. [00:44:25] S2: No love lost. [00:44:26] S0: These guys left OpenAI Yeah. Because they didn't trust Sam. That was what they said. Yes. Yeah. [00:44:33] S4: And then... But guess what? Sam was playing this game to win. And when it became clear that Sam was right, that you had to have compute locked up to win the business game, what did Dario go do? [00:44:44] S0: I mean, he's a rationalist. He's a rationalist. I mean, he's definitely not dumb if you build [00:44:49] S3: And by the way, that's why Elon is also winning too.