The Twenty Minute VC (20VC): Venture Capital | Startup Funding | The Pitch
00:24:43 · Harry Stebbings, Jason Lemkin
[00:24:43] S0: What do you mean does it matter? Sorry. [00:24:45] S2: Yeah. What's the killer app? Another reservation at a Cheesecake Factory or TGI Fridays? We need to see the VisiCalc of Muse. We need to see what is the killer app. Every horizontal platform needs a, you know, traditionally needs some sort of killer app, right? I'm just skeptical. I'm just wondering. Right? I don't think... And this whole thing, I don't think there was a killer app for OpenClaw. I don't I don't know if there is a killer app for Muse because... Or Instinct because there wasn't one for OpenClaw. [00:25:12] S0: Is it is it not being your discovery mechanism to shopping like a a WeChat, a super app? You know, Zucker's spoken about taking portions of transactions as being the business model as well. The model's good, but what [00:25:26] S2: are what are his examples? Scheduling his daughter's carpool. Is that really what a trillionaire needs to do with a general... He can't even come up with a good use case of views for himself. He's making up consumer y things. I had to schedule ballet lessons for my daughter. I mean, great, but you need to run this thing eight hours a day. I think like Claude Code or Codex to really matter. And so if we're in it eight hours a day like a super app, it's cool. If it's a random task, I'm just waiting to see what the killer app is. Muse is really fun. Like it's so beautiful. The beauty is it gives you all the ideas. It has an idea tab, and it tells you all the things to do. I've done most of them, and they're great. I just don't know if it's killer.
00:25:26 · Jason Lemkin, Harry Stebbings
[00:25:26] S2: are what are his examples? Scheduling his daughter's carpool. Is that really what a trillionaire needs to do with a general... He can't even come up with a good use case of views for himself. He's making up consumer y things. I had to schedule ballet lessons for my daughter. I mean, great, but you need to run this thing eight hours a day. I think like Claude Code or Codex to really matter. And so if we're in it eight hours a day like a super app, it's cool. If it's a random task, I'm just waiting to see what the killer app is. Muse is really fun. Like it's so beautiful. The beauty is it gives you all the ideas. It has an idea tab, and it tells you all the things to do. I've done most of them, and they're great. I just don't know if it's killer. [00:26:04] S0: I don't know if it needs to be. And I know that sounds stupid, but no, but I use Instinct in a similar power user way. I think latency is a real problem with instinct, by the way, which might not be with matter. Wait minutes for responses. Minutes. It's like the first days of chat GPT. It's a real problem. But I don't know if it needs to be. It does all of my bookings, travel, restaurants. It does all of my shopping. It's very good. It does all of my calendar invites. I know there's no killer app, but it's just incrementally better than everything else. I don't know, but there's lots of little bits not good enough.
00:26:36 · Rory O'Driscoll
[00:26:36] S1: I have a feeling it might be. I I think... Well, I'm skeptical of the category on a stand alone basis. But, you know, I always have my three venture questions. Is this a category? Who's the winner? And are we getting paid for the risk? And is this a category question? Is is there a role for AI in a kind of personal assistant messenger type thing? And I will say having used both Instinct and Muse, I can see it. I don't know if I love the word killer app because a single thing that does everything, you know, that that that just ignites a platform like VisiCal... Let's leave let's leave the killer app concept out there. Right? At the margin, you kinda go, yeah, I'd use this. You have the example from long ago of WeChat, you know, Chinese messaging systems having very much a super app. Facebook tried to do that with the messenger. It didn't take off Because the truth is the UI, pre AI, the UI of trying to book things on a chatbot is a pain in the butt. It's actually a lot easier just to go to the United website and see all the flights at the same time and book it. It is possible that with intelligence at the back end as a thing from, you know, non intelligence, you you actually have an interaction on a mobile device where enough of the intelligence is in the cloud that it can do a lot more for you. It knows a lot more about for you, and it just becomes an easy place to get shit done. And therefore, to your point, Howard, at the margin, you can imagine people using this. If you're a Facebook user, you get muse, you're a happy little camper, you chug along. Do I think there's more of this going to happen? Yes. To me, the interesting question is, the second one is, do you think it's a standalone company that wins here, or do you think it's going to be Facebook with Muse and OpenAI with whatever product they come up with? Do you think that the instincts of this world can build a standalone business here, giving that... To put it out there, having raised at something like 50 pre less than five months ago, then 400 pre, then a couple of billion pre, then now rumor has it raising at nought to 10,000,000,000?
00:28:29 · Harry Stebbings
[00:28:29] S0: They are raising 1,000,000,000 at 10,000,000,000, and the most popular segment of the show that we got was Jason's IC. So, Jason, we have a billion dollar round for Instinct. Welcome to the partnership meeting. Thank you. And it's a $10,000,000,000 valuation. Will we be putting in $200,000,000 into this billion dollar round at 10,000,000,000?
00:28:52 · Jason Lemkin
[00:28:52] S2: Well, we we will. And I will... I'll be honest to the team. It's a... This is risky one. I am impressed with what Muse has done. And if we had to compete head on with Meta and that was the only thing, we'd be in trouble. I would not recommend this investment because we can't compete with their servers. We can't compete with the GM. They can't compete with the LLM. However, after having done several reference calls and over a dozen synthetic ones on Claude, I've learned a couple of things. First of all, Meta cannot go cross platform. It cannot go in. It does own WhatsApp, which is a real threat. It won't be worked with all carriers. It won't work across all services. It won't work across. It's highly focused on its own platforms. And so that is only a subset of how we communicate. How many folks between the ages of 18 and 55 are on Facebook all day? Very few, right? It's really your grandmother's application. Now WhatsApp is popular and Instagram, but the fact that it is not going to be interoperable across all these different services means it's got a fairly limited reach. Two, how long will Meta maintain the energy here? Right? When this produces essentially trivial to no revenue. Anyone remember Workplace? Workplace in its own way was probably better than Slack for folks that lived in Facebook. It was probably better. It had a lot of neat use cases. It worked well. It was architected and it was actually the highest NPS of any product in the entire Facebook Meta platform, but they couldn't maintain the energy. My reference checks say when Alex leaves scale, this product will fall apart. If this was the only thing that Meta had to do I wouldn't bet against him, but we're just not going to see the commitment to do the kind of things the Instinct team is going to do. And let me tell you this is one of the greatest teams I've seen in my history of investing. They're great. These kids come and they play World of Warcraft in real time during the pitch. They're top 10 each all... They're both top 15 on league. I recommend leading the round but being cautious with reserves because the next round valuation may hit into realistic IPO limits. So you would do this round? I wouldn't. You asked me to do it. There's no effing way I would do this round.
00:30:51 · Rory O'Driscoll
[00:30:51] S1: Okay. Good. Okay.