The Twenty Minute VC (20VC): Venture Capital | Startup Funding | The Pitch
00:35:34 · Jason Lemkin, Rory O'Driscoll
[00:35:34] S0: Yeah. In all seriousness, I don't know how like Canadian got... Like national governments work. When you talk to folks that run at the top companies with large corp dev portfolios, public companies, really they just want it not to go down in the aggregate. They'd love the gains. Right? But you only get so many credits as a public company for gains from your portfolio. And the losses really suck, right? Because they swing your EPS in really weird ways and you have to put asterisks and daggers next to it. So as long as they don't lose too much money on the investment, I don't know they care. [00:36:02] S1: I mean, but I think there's two separate things. You're right. The motivation for anyone doing this isn't purely financial gain if you're the government. Right? Agreed. But Harry asked a separate question is, can it work? And I think the answer there is, yeah, you can keep it... Yeah. Governments can make things happen for a fair while, but what they can't do is make the private sector use the product. So you see it with Mistral too. To the extent that there's a willingness to spend Canadian government tax dollars on a Canadian government AI solution, or maybe if Canada goes on with its kind of affiliating with the EU, these guys in this trial may be the You're Not America LLM options. And there probably is some spend to that. But do you think it'll be a compelling business that will go public at 3x this round? Not as obvious to me at all.
00:36:02 · Rory O'Driscoll, Jason Lemkin
[00:36:02] S1: I mean, but I think there's two separate things. You're right. The motivation for anyone doing this isn't purely financial gain if you're the government. Right? Agreed. But Harry asked a separate question is, can it work? And I think the answer there is, yeah, you can keep it... Yeah. Governments can make things happen for a fair while, but what they can't do is make the private sector use the product. So you see it with Mistral too. To the extent that there's a willingness to spend Canadian government tax dollars on a Canadian government AI solution, or maybe if Canada goes on with its kind of affiliating with the EU, these guys in this trial may be the You're Not America LLM options. And there probably is some spend to that. But do you think it'll be a compelling business that will go public at 3x this round? Not as obvious to me at all. [00:36:44] S0: Well, in today's world, today's day and age, Cohere not disclosing revenue is hardly a flex. No. It's a pretty bad sign. I love it. It's like ARR grew more than 165%. You're like... Since inception? [00:36:57] S1: Yeah, know.
00:36:57 · Rory O'Driscoll, Jason Lemkin, Harry Stebbings
[00:36:57] S1: Yeah, know. [00:36:58] S0: You know, one thing I was thinking on the Kalshi thing before we leave. So Sequoia led the last round, right? At a billion... They put in 1,000,000,000 right after felony charges were against the founders. Right? And, I get that it's just a state. And and then we have Binance, right? 6,600,000,000 taken by apparently North Korea in a matter of hours. I had to wonder between Sequoia and Binance, if the ball had bounced just a little differently, would FTX still be around today and would it still be a winner? Same VC, same risks. FTX got... Listen, you obviously can't take money from one sister company and put it in another, But I think Binance barely survived this 6,600,000,000. They don't have a transparent balance sheet. We don't know how much money they had. What if it was 13,000,000,000? Where would they have repaid it? I think they were one step away from an FTX type situation. Luckily, he got pardoned CZ, right? But I just wondered if it made me think of since you have the same investor and the felony, we've just all changed the way we take risks because it's game on, right? It just made think about Apparel Universe where FTX was a was a shining portfolio company today. [00:37:59] S2: Do know what mean? The fascinating thing is FTX's $500,000,000 position from Anthropic [00:38:03] S0: would say we know. Yeah. [00:38:05] S2: Would be worth 39,000,000,000 at the 1,500,000,000,000. So timing is important, is the takeaway, kids.
00:38:05 · Harry Stebbings, Rory O'Driscoll, Jason Lemkin
[00:38:05] S2: Would be worth 39,000,000,000 at the 1,500,000,000,000. So timing is important, is the takeaway, kids. [00:38:11] S1: The most compelling fact about the Binance thing was, was that they could pony up $6,000,000,000 to replace the money that was taken. That... What a good business. I mean, assuming that you're not doing an FTX and swiping it from someone else. As I understand that, and I did not spend a lot of time on this Binance were able to make good the crypto loss, which implicitly means Binance makes enough money to be able to make good the crypto loss, which means it's an amazing freaking business. [00:38:34] S0: I think so. I just think... And again, I'm not a crypto guy, but when CZ said they could cover it, but it would be tough, suggested to me they didn't have 13,000,000,000. And what I really thought was ridiculous is how many folks said that their balance sheet was all the crypto they hold as a trustee, as a custodian. That's not true. That's why Sam's in jail and CZ is out. I don't think they had $13,000,000,000 I think they got out in Black October. [00:38:58] S1: Yeah, you can't take my crypto dollars and give them to Harry and say, Sorry, your stuff was stolen. Agreed. [00:39:03] S0: Yeah, their balance sheet. Mean, think how much still happened in Black October. And then we have this... The one that I think is craziest, I don't mean to get off track, this... I know it sounds minor, but it's not this ARDEX thing that breached WorkOS and a bunch of others. This is just... Since we did the last one, this one is insane, this ARDEX thing.
00:39:03 · Jason Lemkin, Harry Stebbings
[00:39:03] S0: Yeah, their balance sheet. Mean, think how much still happened in Black October. And then we have this... The one that I think is craziest, I don't mean to get off track, this... I know it sounds minor, but it's not this ARDEX thing that breached WorkOS and a bunch of others. This is just... Since we did the last one, this one is insane, this ARDEX thing. [00:39:18] S2: I saw that Michael Grinich post about this sixteen hours ago, but tell everyone what this is.
00:39:18 · Harry Stebbings, Jason Lemkin
[00:39:18] S2: I saw that Michael Grinich post about this sixteen hours ago, but tell everyone what this is. [00:39:23] S0: ARDEX, we should be scared about. ARDEX is initially well regarded. It's only like a couple months old. A Chinese open source pen test solution to penetrate test applications. We all need pen testing. We always needed it before. We certainly needed an agentic area where everyone from Binance to the rest of world is being breached. We're all being breached. All the refrigerators in Europe are going down because they've been breached. Black October was much blacker than we made it look. And so some really smart developers, just a couple months ago in China built an open source thing, great, so it's free and you could hook it up to your deep seek and your other LLMs and it will just try to hack you. And this is what you're supposed to do. You're supposed to hack yourself, but it became very easy to turn it around and just attack other folks with agents. It became... It was flipped around and it's become one of the the greatest threat. And a lot of folks are saying, well, could always you could always do this, but now you can do it with LMs at scale. You can just tune it against anybody you want.