Jason, you are the unique person that is

at the intersection of both the

and the SPLC files. Do you have

[laughter] a comment?

>> Do you have a comment, Jason?

>> in the SPLC files. I

>> Yes, you are. You're adjacent to the

vice president. You're SPLC adjacent and

you're

What does that mean? In the Venn diagram

>> Thank you, though, for putting me in the

crosshairs of all the losers.

>> He's got a I got a really good way to

select. I mean,

>> There's a reason why I'm carrying this,

guys. It's because the people

>> What the [ __ ] is going [laughter] on?

>> THERE'S A REASON WHY I CARRY a stiletto

and a P35.

>> What the [ __ ] are you doing? [laughter]

>> There's a reason. If you want to jump

the fence, feel free.

>> [laughter]

>> J CAL IS READY.

>> YOU LET YOUR WINNERS RIDE. [music]

>> RAIN MAN David Sacks

>> And I said, "We open-sourced it to the

fans and they've [music] just gone crazy

with it."

>> All right, everybody, welcome back to

the greatest podcast in the universe,

episode 270 of the All-In podcast, your

podcast for your favorite podcast. With

me again, your sultan of science, David

Friedberg, the dick

tater, Chamath Palihapitiya, and yeah,

the Rain Man is back. Yeah, it's

definitely David David Sacks. He's

definitely in DC with a with POTUS,

yeah. POTUS lets him drive in the

driveway. Uh Sacks, what's going on? You

you pushed back, you big-shotted the

entire crew, and pushed the show back an

hour.

>> Simple text. He's like, "With POTUS."

>> Start unbelievable.

>> Start later.

>> Okay, we'll just wait. Okay, Daddy. Look

at him. All right. All right, big shot.

What's going on?

>> No, look. I was in DC today and I was at

the White House and

I just asked if the president had time

and he made time. And we had we did have

a little meeting and so we did push back

the pod for that. One thing I just want

to say is just what a pleasure he is to

deal with. You know, when I read in the

media, they're always describing him in

a certain way that you know, he's

yelling at people or he's moody or or

something like that and that's never

ever been my experience with him. He's

always pleasant to be with. He's always

genial.

>> Super charming.

>> questions. He's interested in the

subject matter.

It's just a completely different

portrayal. I don't get where the media

is coming from at all on this.

>> He's charming AF.

>> Totally. Totally.

>> He's charming.

>> maybe if you double-crossed him, maybe,

I don't know, but I've just never seen

any evidence of of how they describe him

at all. And I think on our issues of AI,

I think we're really lucky that he's the

president who's in the White House when

this AI revolution is happening.

>> I mean, doing alt history, Sachs, what

would happen if Kamala ding-dong was in

right now and we'd have like no data

centers?

>> We'd have no data centers and they'd be

using AI to censor us and they'd be

promoting DEI values through AI. That

was in the Biden executive order.

President Trump just wants the country

to win and be successful and he doesn't

have these like doomer neuroses about

it. That's not to say we don't support

any regulation at all, but we should

have specific solutions for specific

problems as opposed to being cowering in

fear over this and just trying to halt

all progress. And I think a really good

example of that was his idea around data

centers where he said over a year ago

before data centers even became a hot

political topic, that we should let our

AI companies stand up their own power

generation behind the meter. And that's

a much better approach than the Bernie

Sanders approach of just shutting

everything down. So, I don't know. I

think we're like very fortunate that

he's the president during this critical

time in development of this technology.

And like I said, he's always been

interested in it. He talks a lot of

business leaders. I'm always actually

very impressed with what he already

knows. He listens to like all the the

guys in the industry and he synthesizes

what he hears. I think he's very good at

that.

>> He was talking about the Anthropic guys,

and he was like, "These are brilliant

guys." And he was like, "Giving the

flowers to them and how genius they

were, and that they were working on a

deal." Any insights there about the

relationship between the White House and

Anthropic?

>> I thought what he said was very balanced

and accurate. Like you said, he said

that they were very smart guys. They do

have a great product. I've certainly

acknowledged that. He also said that

they were very left-wing, but that was

something we could work through.

>> Hm.

>> Didn't have to [clears throat] be a deal

killer. He said they tried to tell the

Pentagon what to do, which the Pentagon

didn't like. But in any event, I mean,

look, he wants American companies to be

successful, and he he I think genuinely

really does like high-IQ people. I mean,

he says it all the time, and people

think he's joking, but I actually think

it's like one of his core convictions is

he just really likes smart people. He

likes being around smart people.

>> Loyal people, smart people, people who

are good on camera seem to be the three

circles. And hey, Sachs, you fall into

two of the three. [laughter]

Uh all right.

>> I thought the audience would bring it

that out.

>> Uh topic one,

SpaceX has signed a huge deal with

Cursor.

You know Cursor, that's the AI coding

startup. Really, they they they defined

the category. XAI and Cursor are

building and collaborating on a new AI

coding model that would, quote, be the

world's best coding and knowledge work

AI. Here's the deal as it's been

explained. SpaceX will either buy Cursor

by the end of 2026 for $16 billion.

That's $10 billion more than they were

rumored to be raising at, or they will

pay Cursor $10 billion for their

collaboration together. Bloomberg says

you can think of that $10 billion

essentially as a breakup fee. So, I

think it's fait accompli that this deal

is going to get done.

Cursor's run rate, $2 billion at the end

of February. This is a money-printing

machine. They expect to end 2026 with a

$6 billion dollar rate. They're going to

triple it. SpaceX projected revenue

between 22 and 24 billion in 2026. So

this is quite accretive to the revenue

story at SpaceX at the IPO of SpaceX,

which is now targeting a valuation of 2

trillion.

Which would be trading at roughly 80

times top line revenue, which is a, you

know, people would say it's a high

valuation, but also commensurate with

the opportunity. Cursor's valuation

would be 30 X. So this is a good deal, I

think, for everybody at the end of the

day. Cursor started, I think, built off

of Anthropic's LLM. You could use any

LLM previously on it, but in March

Cursor released the second version of

their proprietary model, Composer 2. And

uh here it is. It's It's ranked pretty

high right now. It's between uh GPT-4

5.4 and Opus 4.6, as you can see on the

screen.

The key part of the story here

is that Elon has 550,000

GPUs in Colossus. He's scaling up to 1

million, and then of course he's going

to bring it to space. So if you believe

that infrastructure matters, and it's

pretty clear it does, this is incredible

for Cursor, who has been compute

constrained. So this is peanut butter

and chocolate. If you put these two

together, I predict that this is going

to move

Space X X XAI and Cursor to the front of

the coding leaderboard within 12 months.

That's my prediction, Chamath.

>> Shareholder in SpaceX via the

acquisition of the Starlink company that

you were a backer of. What are your

thoughts?

>> The acquisition was essentially

negotiated, and the way that it's

structured is so that the S-1 doesn't go

stale. So I think the way that it was

announced has more to do with the fact

that they don't want to slow down and

have to rewrite parts of the S-1, have

to redo the disclosures, um

have to redo the risks. and so I think

what you're going to see is that this

will get done. In fact, the deal is

effectively done.

But what's so smart is that where is

SpaceX today? Let's call it

a trillion.

Where could it be?

Just for the purpose of this argument,

let's say 2 trillion. So when the deal

gets done on a stock for stock basis,

it's going to be if again, if it's 60

billion in tomorrow dollars,

effectively Elon's gotten a 50%

discount. And what has he bought? He can

issue a 60 billion dollars of stock at a

2 trillion dollar valuation and get a

model and a service that I think is

extremely compelling in coding, which is

where we know all of the immediate and

short-term revenue gains are. It's also

patterns that are hard-fought and are

really valuable in reinforcement

learning. He gets all of that. And then

he gets a very cracked team, which, you

know, we've known for a while that the

cursor team is absolutely excellent. If

you look at the Grok usage, it shows

why he had this excess capacity. There

was a moment where Grok had a very steep

and very aggressive discount on their

output tokens.

And in that moment, there was just a lot

of experimentation and usage. And over

time, that sort of

went away.

So there was a lot of capacity and

relatively low utilization, I think,

inside of Colossus that he was able to

turn around, jujitsu move the whole

thing, and basically acquire the most

interesting and valuable third-party

wrapper service in AI right now. So, and

the fact is that they got it

effectively, I think, at this price for

30 billion.

So I think it was a really good deal,

really smart deal.

>> Sacks, your thoughts if you want to

unpack it a bit. Under the framing, I

think it's be interesting for you.

If we were sitting here 3 years ago, the

Biden administration didn't invite Elon

to

the EV summit, and the SEC, and other

organizations, Delaware, they were

explicitly involved in lawfare. They

were trying to put Elon in prison, and

here we are, the most important company

in the history

of the United States, SpaceX AI and

Tesla, now on the verge of just creating

the greatest products in the history of

humanity between SpaceX,

clusters in space, and Optimus. Your

thoughts?

>> Well, you're right. I do remember a

press conference where Biden said we got

to look at the sky. And so, on the heels

of that, the DOJ brought a a lawsuit

attacking the company for not hiring

enough asylum seekers. Remember that?

>> SpaceX, which they can't under ITAR.

>> They couldn't, exactly, under ITAR.

Anyway, that's all ancient history, so

let's let's put that behind us. Look, I

I agree with your guys' analysis on

this. I think these two companies are

are very complementary. Cursor,

obviously, is very strong in coding.

And that's what it brings to xAI. xAI

brings compute, and they bring a

foundation model. And the problem that

Cursor had is that even though coding is

kind of like the white-hot area of AI

right now,

when it got started, it was really

competing against generalists in the

form of Open AI and Anthropic. But now

those generalists have decided to

vertically integrate in this area of

coding, right? And so, Cursor's now

competing against Quad Code and Open

AI's Codex. And so, they were dependent

on foundation model companies that were

getting in the business of competing

with them, which was just not a good

place to be, right? So now, they have

this new alliance with a different

foundation model company, which also

brings the compute. Just makes a lot of

sense, and then they bring Cursor brings

to xAI

the training data,

a lot of enterprise clients, and the

experience in coding. And I think this

will accelerate xAI in this area.

>> Sacks, you think they're going to dump

Kimmy K2

.6?

Cuz I think Cursor Composer 2 uses the

Moonshot model. There's no reasonable

way that Elon's going to pay $60 billion

and not run on top of Grok. I got to

think.

>> It seems like it.

>> Yeah.

>> Likely, but I don't know.

>> I think it might be tough depending on

the the users. One of the things that

makes Cursor so good is

>> wait. Say Say more on that. What do you

mean?

>> So, I think that the different

developers

want to have choice in that sense.

There's a toggle. So, one of the things

that's really good about Cursor is

they've got this very well-built out

IDE, this application layer that puts

them probably from a UX perspective,

meaning developers are using the tool

above Codex, above Claude, above

anything else. You can use a third-party

IDE and integrate the models or

integrate whatever other third-party

service you're using. But I would

imagine that the developers are going to

want to

continue to have at least some choice on

what's actually writing the code for

them. The thing that people are waking

up to in the last 120 days

is just how much of the value of AI is

being realized by writing software. And

we've kind of got this wrapper term we

call it agents. But agents are

fundamentally just quickly spun up

applications.

But for all of them, as we're realizing

very quickly, you end up making too many

agents. They end up being super

inefficient. They need to be engineered.

And you still need to have a strong

software engineering capability and

competency to fix all the agents, to

build all the harnesses, to make

everything work well together. And

that's why having a strong developer

environment, a strong IDE, actually

solves that biggest problem. So,

eventually all the enterprises that are

getting hot and heavy on agents are

going to be like, "Whoa, wait a second.

We've actually got to fix how this is

all being done." As we saw this week in

that story with Amazon, where there's

like a million agents being spun up

inside and everything's wasting

resources, redundant data creation,

redundant data stores, redundant API

calls, et cetera. Tons of money being

wasted. So, you have to centralize

still. You have to have good software

engineering talent that's making good

infrastructure and good use of these

agents. And that ultimately will require

an integration of the AI tooling with a

standard software engineering front end,

which is the IDE that Cursor has. So, I

think that that's probably where

everyone's waking up to the fact that

having the the software engineers

may end up winning you the arms race

here. And seems pretty smart for Elon to

buy Cursor.

>> One other piece of it, you mentioned K

me uh K2.6. Yeah, I mean, so I think

that one of the things that's going to

become a priority over the next several

months is this idea of optimizing

because enterprises token bills are

going through the roof right now. I

mean,

this month over month they're spending

increasingly large amounts because their

employees are just building more and

more software, but I'm not sure that

anyone's been incentivized yet to be

efficient about it. And it really only

makes sense to go to a frontier model

for a frontier task, but more mundane

things can be done using an open source

model or less expensive model. And I

think like you're saying, whether it's

the IDE or something else, there needs

to be some sort of

middleware that determines which model

you go to and how much you're willing to

spend and what the most efficient way of

getting the tokens is going to be.

>> I am deep in playing with XAI's suite of

products and I would predict

we're going to be sitting here in 6 to

12 months and they are going to be

dramatically dramatically improved.

>> Let me just flag one other area that I

think is maybe the white-hot center

within this red-hot area of [snorts]

coding,

which is cyber.

And I think Mythos has kind of woken

everybody up to the potential of

frontier models to be a weapon that can

be used by either cyber offense or cyber

defense.

Now, the issue with Mythos is that it's

very large and expensive. It's something

like a 10 trillion parameter model. And

there's a lot of reports that Anthropic

just doesn't have enough compute to be

able to serve it. I'm not sure it was

ever built to be a commercial model, to

be honest, because I just think it's so

big and expensive, but

I think what will happen is

these companies will start training

dedicated cyber models.

They'll say Mythos comparable models,

but with a lower token cost, and

I think there's a real race on right now

to get those products to market, because

I think IT departments and CISOs are

very worried about the risk of hacks

right now, AI-powered hackers. So, this

is something I think over the next 3-6

months will be, again, this maybe the

hottest part of the market.

>> Polymarket says all of this is fake.

Complete SpaceX acquiring Cursor, 74%

chance. SpaceX IPO by the end of August,

80% chance. So, this is happening,

folks.

All right, let's keep it moving.

>> I think that deal structure is smart,

because, I mean, to Chamath's point,

yeah, it prevents the IPO process from

being disrupted. Also,

it kind of gives a huge motivation to

these Cursor guys to bust their ass and

make it work over the next, I don't

know, 6 months. Yeah, they have a $10

million break-up fee, but I'm sure they

want the deal to be successful.

>> Well, the $10 million break-up fee will

go back to SpaceX anyways, because if

they actually run the compute and

they're not owned by SpaceX, they're

going to have to pay for it. That is not

cheap.

>> I mean, we saw a bunch of these

xAI co-founders leave after the

acquisition by SpaceX. I don't know if

that was the reason why, but, you know,

all of a sudden they're sitting on

SpaceX stock, and they may have felt

like

they had it made, you know?

>> Well, it's actually

>> always a problem. It's always a problem

with with M&A.

>> This Cursor thing came about pretty

quickly, because

Okay. Let's just say friends of ours who

were supposed to wire into that round

were like, "Where's the wiring

instructions?" It all just evaporated.

Here's a tweet from Elon. We don't have

to um speculate too much. Here's Sachs.

He was very clear that uh xAI wasn't

um built right the first time around.

The quote, "XAI was not built right

first time around, so is being rebuilt

from the foundations up." Same thing

happened with Tesla, and uh that tweet

is from

about 5 weeks ago.

>> How crazy is it then when he tweets he

gets 50.8 million views?

>> It takes the four of us 7 months to get

50.8

>> our collective

>> It's unbelievable the distribution he

has.

>> Well, also, how many CEOs would just

fess up like that and say, "Yeah, that

we didn't do it right the first time and

now we're rebuilding it." I mean, most

of them are not willing to say that.

>> He's a magnet for talent. He's a magnet

for the right kind of talent, and the

SpaceX talent has his philosophy. He

inherited, I think, a lot of

you know, maybe uh people for XAI or for

Twitter that were not in his mold, and

they're clearly getting aligned. And

it's also going to make his day-to-day

life much easier when all of these

things are occurring in the same

building with the same team. The

continuity of not having to task switch

between companies is going to be great.

We talked a little bit about the

possibility of Tesla and SpaceX merging.

>> Even Walter Isaacson now is on the Tesla

SpaceX merger train.

>> Mm, there you go.

>> He just did a pod.

>> Everybody's confirmed it. It's going to

happen. We called it here first.

>> Okay, topic two. Is there a SaaS debt

bomb in private equity?

Thoma Bravo, we had Orlando Bravo at the

fourth All-In Summit last year, is

nearing a deal

to hand its company Medallia over to its

creditors. This is a SaaS

for customer experience company. TB

acquired them in 2021 for 6.4 billion

all cash

at the top of the market.

As part of the deal,

they incurred 3 billion in debt, and for

background in 2021, this company had 470

million in revenue growing 20% a year.

Earlier this month, Bloomberg reported

that TB's debt servicing costs for

Medallia were about to triple from a

hundred million a year to three hundred

million a year. Blackstone and other

firms refused to extend

a lifeline to the company to the SAS

company. So, it looks like Thoma Bravo

just handed the keys back and wiped out

5.1 billion in equity. Chamath, your

thoughts? We've been talking about the

SAS headwinds for a bit. You've been

quite vocal about it.

>> Well, first of all, I think Thoma Bravo

is an unbelievably well-run

organization. Their returns are bonkers,

and Orlando is

really, really, really good investor.

So, what do I think happened?

I suspect that they probably got enough

of their equity, if not all of their

equity.

There's probably a decent chance that

they did at least one or two dividend

recaps in the last five years.

And if I had to guess, I suspect that

they are

positive return. It may not be the

return that they would want. And so,

turning the keys over becomes easier cuz

you have to remember,

in private equity, the entire playbook

is for transformations of assets that

are at some point not working.

Right? It's very rarely that they're

buying the same kinds of businesses that

the four of us would buy, which is just

sort of this, you know, clean white

sheet de novo grow at all costs kind of

business. So, they have operating

partners and all of these other people

waiting in the wings

to un-

situations. That's the whole playbook.

Mhm. So, to turn it over, I suspect

means that there is a core rot

that people couldn't fix combined with

the fact that they have probably gotten

enough downside protection that it's not

a huge thing for them. Now,

this is an issue for the bondholders,

and then that'll maybe flow through to

the borrowing costs that Thoma Bravo has

to pay maybe for a a

deal. I don't know, but I doubt that

they would just walk away from a

business. So, I suspect they probably

got most of their money out.

>> I don't know if that's true. There was

someone that published some internal

data showing

that the sales team was like 18% of

target at Medallia.

You guys know what this company does?

Medallia?

>> Customer support is the general arena

and customer experience.

>> Customer experience management. I don't

know what I don't know what that means.

>> Yeah, they'll basically send like you go

on Caribbean cruise ships and you get a

survey afterwards and then they use that

survey data to provide management

insights and operational insights to the

leadership team and the operating team

on how to improve the quality of their

product or their service. So, it's sort

of like this feedback surveying loop.

So, if I were to tell you guys, "Hey,

you want to

build a feedback surveying loop to run

your business better, are you going to

buy SaaS today or you going to ask your

AI to spin up an agent for you to do

that?" And I think that's a big part of

what's happened is all these sorts of

companies where the alternative to

buying a SaaS product is to spin

something up internally and it's much

cheaper and easier to spin it up

internally. You get a custom workflow.

>> I agree with that. But, I'm just saying

in the last 5 years, you think they sat

on their hands and didn't take a dollar

out? They're not that dumb.

>> Maybe they took cash out, maybe they

didn't, but there was still a big debt

overhang and the debt's clearly

um gotten impaired, which means the

equity

>> The debt holders The debt holders are

clearly screwed here.

>> Yeah.

>> The question is is Thoma Bravo screwed?

And I would say, if you sat around for 5

years, they're That's not their style.

They generate too much money. They're

too good.

>> So, they may have taken cash out and

covered some of their their costs, but

the equity got fully impaired and then

the debt is clearly impaired cuz you can

see how the debt and

the uh CLOs are trading, which indicates

that this business is just not doing

well. And then someone else on Twitter

posted some internal information from

Medallia saying the sales team is just

not hitting their targets. They're like

way, way off their sales targets. Which

I think speaks to the underlying problem

here.

>> Yes.

>> Which is that all of these

>> that. Yeah, yeah, please. Yeah, so the

underlying problem is that these

businesses in the SaaS space where

you're driven by net new sales every

year, how many new customers are you

signing up and then you're trying to

manage retention and you're trying to

increase sell-through and retain

customers, they're just having a really

hard time sourcing new customers and

there's probably higher than model

attrition. That's right. And when you

have a very kind of typically

historically predictable business where

you can say, "Hey, I've got a net

revenue retention of 118%

or what have you, meaning I'm I'm

selling into my install base by 18% over

what I'm making last year and then I'm

signing up new customers,

you can lever that business, right? You

can borrow money against those cash

flows because it becomes predictable.

And what's happened in the last year in

particular is agents have become so good

and so fast and so cheap that many

enterprises can simply spin up an

alternative to a vertical SaaS solution

and that's crushing the sales team's

ability to sell in. That's who you're

competing against. Now, I want to make

one point and just link this with

something else that happened this week

and that's Kevin Warsh's hearing

for Fed Reserve chair.

Kevin Warsh went and talked a lot about

the deflationary effect of AI. And I

actually think we all talked about the

SaaS apocalypse as if it's the sort of

like isolated business phenomenon where

these SaaS companies are getting blown

up. I think another lens to look at

what's going on is the incredible

deflation of how much it costs to

successfully run a business and you

don't have to pay a premium price for

SaaS products anymore. Meaning that that

piece of the business can suddenly get

much cheaper. That AI is delivering on

its deflationary promise. I'll just say

one thing about what Warsh said. Warsh

spoke a lot about the deflationary

evolution promised by AI and that he

expects that it will drive productivity

growth like we've never seen before. But

he said, "I don't know what that's going

to do to the job market that there may

be a dislocation between that

productivity growth being realized and

how the labor markets are going to be

able to respond to those things. But

fundamentally, he's saying that we're

going to see economic deflation. The

problem with economic deflation is that

when it occurs, it means some business

is seeing their revenue go down. And if

that segment of the economy is levered,

if they have debt sitting on top of that

piece of the economy where it's supposed

to always, always, always grow, like a

SaaS company's top line is always

supposed to grow, suddenly that debt

gets impaired, and that can have an

economic ripple effect that is adverse.

But what he's pointing out is that as a

result of deflation, because it's not

coming from some cost cutting or

economic contraction, what he's saying

is that the deflationary forces

ultimately lead to economic expansion

because other parts of the economy will

now grow. So if I can suddenly cut, you

know, call it 50% of my SaaS budget, and

I can reinvest that capital in other

ways of growing my business instead of

managing my expenses, all of a sudden my

enterprise will grow, and the economy

will grow. He also said, just as an

aside, and I want to make sure I cover

this so so that we're really clear, he

said the way that we've been measuring

inflation is wrong. And that he doesn't

agree with the way the Fed has been

measuring inflation because you can do a

survey of any household and they'll tell

you, "My god, everything's so

expensive." So all of the indices and

[ __ ] that are being used to

calculate an inflation index is

completely misrepresenting what the

average American is actually feeling.

And so he wants to rethink how the Fed

is addressing inflation from an interest

rate perspective, but he does think that

the overall kind of economic picture is

one of deflationary pressure and

productivity gains coming out of AI.

>> Sacks, I'll I'll drop this off to you. I

think it's pretty clear what's happening

here is that the loss SaaS's loss is the

token dealer's gain, right? And startups

are now, and we always see that they're

the tip of the spear. They're writing

their own tools, they're making their

own dashboards. I see that every day.

And if you look at the SaaS product

index, here it is. Salesforce down 32%

uh in the past 6 months. Shout out to

Bestie Benioff, best guest we've had on

SaaS at the summit. ServiceNow down 54%,

Snowflake down 43%, Adobe down 33%, and

Figma, which had a huge IPO pop

and is now down 67%.

So, what is the role of venture capital

and then private equity in addressing

the software market? Software was eating

the world. Now tokens are eating

the SaaS business and the software

business, yeah?

>> Well, I'm of two minds about this. I'm

going to talk about the opportunity for

private equity.

Let me just say backing up that

historically we only had two good exits

for software businesses. One was IPO,

the other was M&A. And then these big

private equity shops came along and gave

us a third potential exit, which is you

would sell to them

and then they would raise the capital

based on, I don't know, 1/3 equity and

2/3 debt. So, it was debt-financed

buyouts, which is something that's been

around in let's call it the non-tech

part of the economy for a long time, but

was a relatively new entrant into the

world of technology. And the reason for

that is that if you're going to

debt-finance a purchase, you need to

have very stable cash flows

because if you miss

if your cash flows miss and you can't

pay your interest on the debt then

you're going to lose all your equity

because the debt holders will foreclose.

So, in order to do a debt financing of

any kind, you have to have very

predictable cash flows. And it was

believed for a long time that software

did have those predictable cash flows,

at least for the mature businesses, the

ones that were at the stage where they

could IPO as a potential alternative.

So, it was a very attractive thing. I

Like I said, I think it was great to

have that third option. I I'm of two

minds about where the private equity

business is today. On the one hand

the pricing now has got to be super

attractive for them. I mean, we're

seeing public SaaS companies that are

doing a billion of ARR with 20% rates,

80% gross margins,

and they're trading at three times ARR.

You can buy a dollar for 50 cents.

So is that an opportunity Sachs you

think

hit rock bottom you should do a roll up?

Well, on the one hand I do think that

the pricing has never been more

attractive if you're a private equity

shop looking at a business like that. I

mean those companies used to be valued

at 13 times ARR now it's three.

I'm talking about like a category

leader. Now the downside of that

Salesforce is off 9% today. I don't know

if you guys saw this but the market's

absolutely tanking today after the

Medallia

announcement came out. Right. Okay, so

so that would be like you know I said

I'm of two minds about it. So

I would be bullish for private equity

just based on pricing but the bearish

part is that in order for their business

model to work you have to have

predictable cash flows. You can't have a

SAS company go from I don't know 120%

net dollar retention one quarter to 80%

net dollar retention six months or a

year later because a big part of their

customer base is attrited to using

tokens, right? Or to basically creating

some bespoke software. You just said the

absolute critical thing in all of this

which is you have to have predictable

cash flows. I think what happens is when

you're a startup

you typically have to figure out how to

disruptively price to enter the market.

So you're like, okay, if I deliver $10

of value I'm going to charge a dollar

and that's that's the normal playbook

like a 10% ratio, right? Of price to

value.

The problem is when you start to stack

venture capital into it and you then you

stack growth equity into it what you're

effectively

creating in in the preference stack of

your company

is that you are creating a higher return

hurdle.

Right? You got to clear 300 million, 500

million, a billion of pref and then you

have to return 15 or 20% on top of that.

So what do people do as they raise more

money?

they increase price.

But the problem is at some point when

you increase price,

you engender a ton of competition and

you put a huge target on your back.

Private equity is the last stop

because when you they come in and they

lay in billions and billions of dollars

of not just equity, but also debt and

that has to then be completely

predictable and paid back,

their only lever is to raise price. They

can never cut price to take share. They

don't they can't underwrite that to pay

back their debt holders.

And so Sachs, part of the big problem

here and why nobody wants to touch these

companies is that they are overpriced.

Yes, they're making a billion dollars of

ARR, but the unit cost has gotten out of

control. It used to be 10% of value.

It's probably now 30% of value and

everybody's looking at their contracts

thinking, well, when it comes time to

our renewal, I'm going to just cut this

in half

or I'm going to cut this by 2/3 or I'm

going to cut this by 75%

because the value isn't there anymore.

>> Or they can threaten to and negotiate a

better deal.

>> And it becomes even worse because the

minute you make these products headless,

right? And you say, I'm just going to

communicate with these products via MCP

and with agents,

you can't charge on a per seat basis.

What do you do then?

Free book doesn't need 50 seats of

you know, work day.

He needs two seats because the agents

act as the way to write in and out of

work day. So he wants to pay for two

seats, not 50. And then if you multiply

that by a million companies,

that's what gets us to this place where

it just feels like a falling knife.

And I think it comes down to these unit

costs. The unit costs and the price to

value of these products are out of whack

with what the market needs and wants.

And until they reset that or you find

new products that can do it cheaper,

we're not going to get a cleansing and a

clearing here.

>> Yeah, I think

>> way, Salesforce today is down 9% 140

billion enterprise value on 15 billion

of free cash flow.

This thing is trading at less than 10

times free cash flow. It's unbelievable.

>> I think it might be a bargain to be

honest.

>> Yeah, it sounds like bargain hunting.

And what if Benioff, who's the king of

acquisitions, what if he just starts

>> Well, we didn't we didn't put that he's

a buying his own stock.

>> Yeah, and we didn't put this on the

docket, but did you guys see his kind of

headless product announcement?

>> Yeah.

>> Do you see this? It's it's actually very

he's very smart.

>> Yeah, I mean I think it's very smart.

>> There's ways that that business can

maneuver, right? And I think they're

pretty unique. It may be that of all the

businesses in the scape, like

that you know, the ones that have that

scale, that have that multi-product

platform, that have a lot of your data,

there's a lot of opportunity for them to

you know, maneuver their way into an

evolution of the business.

>> one and cuz like if you look at it and

you compare it for example to other

companies, I think the Workday response

was to say, you can't have an AI

interact with us without paying some

kind of like toll.

>> You're exactly right.

>> Whereas Benioff is the exact opposite,

which is he's like, okay, we're going to

go headless for the whole thing, which

is really

>> right. You're exactly right. I think

that's that's going to be the

distinction of the winners here and the

losers and are you on the wrong side of

this?

>> The problem is that we have to figure

out what is the bottom clearing price

and that has nothing to do with business

quality. And so is Salesforce a good buy

at 10 times free cash flow?

Historical artifacts would tell us a

screaming yes.

The problem is that if you cut

everybody's cash flows off at year five

or six or seven,

then all of a sudden, I think you see

the natural compression to between three

and five times free cash flow.

And that is nothing to do that's that's

crazy.

>> That has nothing to do with business

quality. That just says you you

literally mathematically take year seven

through end of the future and you

discount it to zero.

>> And having free cash flow in a war chest

gives massive optionality. We've seen

this with Salesforce, we've seen it with

Apple, we've seen it with Meta, with

Google, with Uber, just having massive

free cash flow. When you've got tens of

billions of dollars, you can put it to

work and you can weather these storms.

>> J Cal, I think another another way to

think about this is

you know, to the question about

maneuverability and who has the gumption

to make the hard choices right now.

>> Yeah.

>> Look at Benioff. He's the founder of the

company. He's run this thing since its

founding decades ago. He is willing to

bet it all. He's willing to make the

change. And it may be that the index you

buy in this era of AI transformation is

the index of founders. That the founders

who are still running their businesses

are going to be the ones who are most

likely to see

>> They can burn the boats.

>> They'll burn the boats. They'll

maneuver. They'll make the changes.

>> And all and all of the guys who have

hired managers to run the business are

going to do the things that Chamath's

talking about, which is trying to charge

fees and try to maintain the old way of

doing things as opposed to reinvent for

the new future.

>> If you look at the 10-Ks, if we could

figure out what the unit price cost and

the trend and the inflation is of a per

seat license for these products,

I will point to the ones that are going

to die first.

>> Chamath, two quick points. So

>> Yeah, wrap us up.

>> Yeah. One is, yes, I would like fully

endorse what what you said about

Benioff. He's made every previous wave

work to his benefit, whether it was

social, whether it was mobile, whether

it was big data, all that kind of stuff.

What are the odds he's going to make AI

work to his benefit? I'd say pretty

good. So, his stock might be a bargain

right now. So, that is me, point number

one. Just And I want to say just a

thing about venture debt, which is I

look, I think it's fine when private

equity guys use it cuz they know what

they're doing, but I've always hated

when founders take on venture debt. And

I know J Cal you agree with me. Part of

it is that founders forget that they

have to pay it back. They treat it like

venture capital and they forget about

that. And then they get surprised. But

the other thing I've never liked about

it is it makes you more fragile. It

basically subjects you to a bunch of

business covenants and it makes it

harder for you to do an abrupt shift in

your business because now you've got a

bank looking over your shoulder and they

want to make sure they get paid, and

they have to review your financials and

all the rest of it. And to your point,

J. Cal, the companies that have free

cash flow right now are the ones that

have the most maneuverability. I hate

taking away maneuverability from

founders, and that is what debt does

because it subjects you to a fixed

schedule of payments. And so, this is

always a thing to remember, whether

you're a business or you're an

individual.

You know, when you put on that debt, it

makes you more vulnerable to big

disruptions in the market.

>> Yeah, it just you become incredibly

brittle, and founders who are listening,

when you get that in in peak markets,

peak zero

you're going to have venture debt people

offer you tons of cash, and then the

problem David and I saw up close and

personal in many different companies

where the founders would look at it as

like, "Oh, I'm extending my runway."

Well, if you're a hot startup, there's

always more venture capital, there's

always more people who want to own

equity. The equity sale gives you

optionality, and you have more people on

your team, more people rooting for you,

and aligned with equity interest, as

opposed to now you have a debt

instrument, they have a different goal,

they have different downside they're

trying

>> No bank wants to be your last 3 to 6

months of runway.

Because that means that in a high

percentage cases, they're going to lose

their money.

>> Yeah.

>> So, they're they're built to try to

avoid that.

>> I've never seen venture debt work well

to improve the quality of the business.

Never.

Never. It doesn't only only ever seen

venture debt leave tracks that damage

companies. And if you get the venture

debt, you can never actually use it. So,

the venture debt investors that

ultimately make money, it's because they

put money in a company and the company

never actually used the money they gave

them. I hate this business. I think

venture debt's like the worst

vulture-like business in Silicon Valley.

It's terrible.

>> If you get down if if the last money in

the bank is the debt you owe to the

bank, they're going to rug you. That's

when you get rugged.

>> 100%

>> You think they can afford to lose 100%

of their money when they're getting an

8% return or something like that? No

way. That's not how it works. VCs can

afford that because we have the

opportunity for

a 10x or 100x or 1000x for that

moonshot. So, we can accept a bunch of

zeros. The bank can't accept a bunch of

zeros.

>> Well, and then when they when they do

get scared and when they do think

they're going to lose their money, wait

till you see what they extract in terms

of value, what they ask for. They will

ask they'll double the interest rate,

they'll ask for warrants. It's basically

like being in debt in prison. Chamath,

you can talk a little bit about your

experience when you were

>> [laughter]

>> in debt in prison.

It's not going to be pleasant. I've been

in debt. I mean, I've had a $420 million

credit line.

And I had a moment where it was

reflexively kind of collapsing inward

because the assets that I was using to

secure it shrank in value in a moment of

market disruption.

I was scrambling and then at the same

time

there was a risk It was the worst moment

of my professional working life. I had

like a couple hundred million dollars

sitting at Credit Suisse and they were

about to implode. And so, on a weekend,

I was trying to figure out whether my

money was still there.

I had always had this rule, don't have

debt and then I violated it to try to

run the number up.

I almost got run over. I almost lost

everything.

I will never do it again. And if I ever

do it again, if you guys ever hear me do

it again, please just come and punch me

in the face.

>> Oh, we will. We've been waiting for an

excuse.

>> Can we punch you in the face for other

things, too?

>> Buffett has this line about how smart

guys go bankrupt is they take on debt.

>> Debt equals prison, [ __ ] Keep it in

your mind, guys.

>> Unless you socialize the debt and then

everyone thinks it's okay, which is what

we do with governments and that's the

problem with governments.

>> He's going to start going off.

>> Yeah.

>> Don't push the button. All right,

listen. We got to talk about TJ.

>> just just just a quick aside on that. In

the 1950s, all the corporations in

America had pension plans where you

would get some guaranteed payout at the

end when you retire. And they were all

like, "We're all going to go bankrupt."

Because a pension plan is either

significantly overfunded or underfunded.

If it's underfunded, you're bankrupt. If

it's overfunded, you've wasted all this

money, you can't do anything with it.

So, they all moved to 401(k)s and

everything got moved to defined

contribution plans except except

governments. And that's because the

government employees formed government

public employee unions and they're like,

"We want to keep the pension plans." And

now the pension plans, it turns out 70

years later, are going to bankrupt all

the governments in the United States.

>> That guy Spencer By the way, that guy

Spencer Pratt who's running for mayor,

he started uncovering all of the

salaries of the union folks and their

pensions in Southern California. It's

bonkers. They're making four, five

hundred thousand dollars a year right

before they go on pension. Then they

double their overtime and they get

two-thirds or a half. The pension

doesn't work. You got to go

superannuation fund. I don't know how

many times we've talked about it here,

but

>> You you don't need an annuitization

fund. You just need a 401(k). Like

people have a have an account. They got

their money in their account.

>> Yeah, but it's just a way to force

people to contribute to it. So, a forced

401(k) is different than a 401(k). You

got to force people and it's you're not

allowed to force people into the 401(k),

as you know.

>> As we've seen in California, everything

related to the government is a giant

grift, is a giant scam. There's tons of

fraud going on. Uh we've talked about

the homeless industrial complex, 12

billion a year to homelessness, but the

number of homeless keeps going up.

There's a million examples like that.

>> industrial complex?

>> Yeah, maybe it's a good time to let's

shift to SPLC cuz I think it's a good

example.

>> Well, we'll get to it. We'll get to it.

Um yeah, but you know what's even better

is you can just pass a law like the Nick

Sherly Act and you can put your fingers

in your ear, cover your eyes and say la

la la la la la and just pretend the

fraud's not happening, which is their

reaction in California.

>> Uh hey, how much fraud has Nick

uncovered so far in California?

>> Billions. He should be a billionaire.

>> Where's his

>> a billionaire.

>> You know, he should be doing it

privately and then getting the

whistleblower awards. I think that

actually would be a better strategy for

him.

>> We told him that was the We told him

that business model, remember?

>> Yeah, I know. He I think he's addicted

to the views, but I mean, he could

literally raise money on

>> Well, he's making

He's making thousands when he could be

making billions to Free Brooks' point.

>> No, he's

>> Well, but it's better It's better for

the public that he's doing what he's

doing.

>> thank god for Nick Shirley. Let's thank

Nick Shirley.

>> whether you could be making more money

or not, what you're doing is

>> And you know what he also did? He shamed

the mainstream media who's forgotten

about investigative journalism, who

forgot the ability to knock on a door

and just ask a basic question.

And now Bari Weiss with CBS has

deputized one of her reporters and she's

doing the exact same playbook and

meeting him punch for punch.

Where's CNN? Anderson Cooper should have

a Nick Shirley on his team. The New York

Times should have Nick Shirley. The LA

Times should have a Nick Shirley. Why

don't they?

>> Cuz you're

You're talking You're talking about old

media that does things one way and the

point about Nick Shirley is it's new

media. It's citizen journalism. It's

people on the street distributing

fact-finding, distributing information

gathering and old media in order to

survive became an opinion organization.

>> Didn't the media used to care that the

Pentagon was paying $900 for a hammer or

what have you? I mean, like 60 Minutes

used to do things. Now, it's like the

media just wants to protect the waste,

fraud, and abuse

no matter how egregious it is. Remember,

I mean

>> Remember that guy, Dennis Kozlowski, the

CEO of Tyco, who went to jail and they

like had it just a feeling because he

had

>> He umbrella stand the like the $6,000

umbrella stand.

>> Made out of like ivory from like

>> [laughter]

>> a rhino elephant.

>> I know you bought that at auction,

didn't you, Jim Matt?

>> Sachs, you're so right. People really

used to care except when it was their

team. And then the minute that it was

their team, they're like, "Oh, no, no,

no, let's just look the other way."

>> It was a

>> If it's a CEO, if a CEO basically

engages in some misbehavior, and I'm not

defending it, the press will be all over

that. But when the government does it,

they don't do anything.

And in fact, we had one of the most

successful, probably the most successful

entrepreneur of our generation donating

his time to the government to find

waste, and the media basically drove him

out of that.

>> They vilified him and drove him out.

>> Yeah, they made it untenable.

>> Well, this is whoever comes up with a

way to eliminate waste, fraud, and

abuse, like Chamath did, and they

productize that and make them that make

that their platform, that's the way to

win in 2028 and going forward is to

convince the public that they don't need

to have their taxes raised, they could

have their taxes reduced just by

eliminating the minimum of 20 or 30% of

waste, fraud, and abuse there is in the

system. Uh we'll get to Tim Cook

stepping down in just a moment, but I

want to remind everybody

liquidity sold out. I'm sorry, we added

a couple of tickets. We we we burned

through them immediately. But you can

still get into the All-In Summit. This

is our fifth edition in Los Angeles,

September 13th, 14th, and 15th.

allin.com/events to apply. Please apply,

and then don't come to us 60 days out

and say, "I didn't get a ticket.

I'm a bestie, get me in." Just buy your

damn ticket and don't get left out.

>> I have a liquidity announcement.

>> Oh, yum, yum.

>> We are going to do one

political panel.

>> Okay.

>> And it's going to be

Dave McCormick and John Fetterman, the

two sitting senators from Pennsylvania,

on stage with us

talking about all topics from a left and

right perspective.

>> Amazing. So, Fetterman's coming, which

means the dress code is now sandals, uh

shorts, and a T-shirt. That's great.

>> Construction Construction sheet.

>> Get your Timberlands [laughter] out.

I mean, is he really going to show up

looking like a hobo? I love his hobo

style. It's great.

>> McCormick's very fit and handsome. So,

like he he'll balance him out. So, I

think

>> That's what we should program it as.

Like, he should wear his best Brioni

suit versus

the Old Navy from Bettermint. Who

[laughter] wore it better? All right,

listen. Just rapid fire here on the Tim

Cook

resignation and moving on. This guy,

John Ternus, is a 25-year vet. He did

lots of hardware, worked on iPad,

AirPods, and he was the favorite on

Polymarket since day one. He's a bold

decision-maker according to reports. And

unlike Tim Cook Cook, Tim Cook did a

great job of squeezing every last nickel

out of Steve Jobs' product line, which

lasted for a decade, iPhone, Apple TV,

Watch, I don't have to need to repeat

them. But, here we are.

We got a product person in the seat,

which is what we all know they needed.

Because, hey, these tools are getting a

little bit stale. Siri, disgraziad.

AirPods, disgraziad. The whole system is

not built on innovation anymore. It's

built, Freeberg, I think you would

agree, on just bringing more profits,

more profits. What's your hope here?

Because, man, they missed so many great

swings at bat. They didn't get the

Oculus, you know, Ray-Bans that Meta

did. They canceled their self-driving

car. What would you hope that this new

CEO of Apple focuses on, Freeberg, in

terms of innovation? They don't have a

problem selling phones still. They don't

have a problem selling laptops and

making a ton of money. But, if you were

in the seat, if you were on the board of

Apple, which wouldn't be a bad idea for

them, if I'm being honest, what would

you tell the new CEO to focus on, David

Freeberg?

>> I mean, I don't know. The software layer

of the future is not the software layer

of the past. So,

>> Okay.

>> It's pretty obvious. I don't know if how

much there is to talk about, but you

just need the Siri equivalent that's

ubiquitous in all of your devices, knows

who you are, personalized to you, sees

your email, sees your calendar entries,

knows what kind of music you like, has

connection to your home. Basically,

build that AI layer for your life. And

make it ubiquitous in all of your Apple

devices, that no matter what device

you're using, it knows who you are, you

can engage with it using kind of a

natural language method. And it's, you

know, it's it's pretty obvious.

>> Yeah.

They should buy WhisperFlow, yeah. I

mean, that would be

>> I don't know how they're I don't know

how they're running the business, but

>> Well, they're running it for profits,

obviously, Sachs. I would say buy

WhisperFlow and just replace the Siri

team with that, because Siri's been just

The fact that Siri can't spell

Polyhymnia or Calacanis after 20 years

of us giving them $20,000 for iPhones is

just disgraceful. Sachs, if you were on

the board of Apple, again, not a bad

idea, what would be your hope for the

company? What would be your sage advice

for the new CEO?

>> Well, I mean, everybody is going to be

asking the same question, which is what

are you going to do about AI. I don't

know that they needed to be on the

bleeding edge of it, but they are going

to need an answer at some point, and

Siri's going to need to be AI-empowered.

Probably the way it should work is that

you get to choose your model. I mean, I

don't know that they need to pick just

one model provider. It could be a

setting where you go in and you set up

your account with whatever ChatGPT or

Grok or Claude or what have you. And you

can choose your own model provider, and

then you'll have more customization and

more

ability to control your your storage.

Let me just say this on Tim Cook's

retirement, he had an incredible run as

CEO of of Apple. I mean, he ran it very

effectively for 15 years. The market cap

of the company went up by over 10X, the

revenue grew from roughly 100 billion a

year to over 400 billion a year.

He also improved the quality of revenue

by moving the mix into services, which

is probably why it got why it got a

higher valuation.

And, you know, people say that well,

they never did any innovation under Tim

Cook, but you know, I've seen people

tweet list of products that were

released under him.

And there were a lot of them. Now,

it's true, nothing as big as the iPhone,

but they did release a lot of products

under Tim Cook. And then just finally, I

mean, you you look back over the last 15

years and there really weren't any

public snafus or scandals or imbroglios

with with Apple. It's one of the few

tech brands that is still, I think,

beloved by the population.

I think a major part of that was Tim

Cook's dedication to privacy and keeping

the company on the right side of that,

which I think users do appreciate. And,

you know, he even Tim Cook even got

praise from the president. I think it

was just unsolicited where the president

talked about how Tim Cook didn't call

him up that often, but when he did, it

was something important and therefore

the president tried to help them out.

Seems like he nurtured a good

relationship with the president over

over the last decade or so. So, you just

have to say that he navigated what could

have been a turbulent period with a

great deal of grace and aplomb.

>> Clearly, Chamath, he was a great steward

of the brand, even though that list of

products were all

developed under Steve Jobs and they were

just executed well, but he didn't

bring in a lot of new products or

services. Any final take

>> Actually, Chamath, can I kindly ask you

a question? What do you think

other than AI, you know, AI-powered

Siri, let's say.

What do you think he missed? I mean,

what should Apple have done that they

didn't do?

>> They would have out by now a pair of

glasses that weren't 17 lb like the

Apple Vision Pro. They would have gotten

glasses that pair perfectly with your

phone, take videos for kids, and they're

coming out with it. It's just on a

really broken timeline. They would have

had a killer Siri.

They would have had a search engine-ish

Perplexity like product. They would have

had a self-driving car. When you went to

the Apple Store, you would have been

buying two or three very important

products. Glasses, a car, and probably a

television set. If you look at actually

what they did innovative under Tim Cook,

I think that they have great taste and

Apple TV produced a lot of great

programming. I he was working on a

television set. Not Apple TV clunked

onto the back. I think those three

products would have been four products.

Siri, glasses, car, television set.

Those would have been extraordinary. And

who knows what he would have come up

with. When they lost Jony Ive, and

obviously Steve Jobs passed away, they

lost the soul of the company. They lost

the innovative, groundbreaking soul of

the company, and they just went into

profit

and iteration mode. But no acquisitions

of note. Nothing important was acquired,

and nothing important was released.

Vision Pro, you can give them like maybe

that's like the sixth best product or

something. But it obviously hasn't hit

the mainstream. Chamath, any final

thoughts from you?

>> Yeah, I have um

three specific things to say. The first

is that he had honestly like an

impossible job.

It's sort of like you play

basketball with Michael Jordan, and then

you're asked to be Michael Jordan.

And I think that that's an impossible

task. And on that dimension, I think he

has done just an incredible job. He has

been

an incredible steward of the business.

Sachs is right, no major snafus. I think

he did a really smart thing around

doubling down on privacy. And just as a

practical matter of being a great CEO.

Like if you I think you can categorize

CEOs in two buckets. One is

the innovator,

the person that's pushing the envelope,

and then the second is just a great

steward.

He's at the top of the top of that

second category. Um I sent you couple of

charts to to show this. And he found a

lane that allowed him to separate

himself from Steve Jobs. So, you know,

as an example, like what does it mean to

be a steward? Well, when you're a

steward, you're allocating resources,

and the two most important resources you

control

is capital

and people. And I think on that

dimension, what Tim did, if you just

look at this, is

he was able to invest appropriately in

R&D. They completely divested their need

of Intel. They spun their entire new

line of silicon. That silicon, it turns

out, and this will be important in the

future,

is very useful

in AI with all of this open claw stuff,

and you know, some of you guys are

completely addicted to it.

And they've kept the acquisitions light.

So, he was very capital efficient. If

you look at the

the next chart,

what's so interesting is like it is the

exact opposite of what Steve Jobs did.

Look at the amount of money that Steve

Jobs returned to shareholders in his

tenure at Apple. It's easy to count. It

was zero.

He loved to to keep that money on the

balance sheet, and he probably, or

maybe, I'm guessing, would have directed

that at some huge shot on goal. In the

Tim Cook era, it was very different. He

shrank the share count by almost 50%. I

think it's like 44%.

>> That's insane. Is there any

corollary to that, Chamath?

>> No, he's he's been a prolific

shareholder friendly CEO, finding ways

to give us money back, which I think

everyone who's owned the stock

has very deeply appreciated.

The last thing I'll say, though, is what

is the future for John Turnus, and I

think it's in this final chart. We

talked about

the problematic nature of increasing per

unit pricing in SaaS.

And what I would say is if you look at

the iPhone,

the unit price has gone up, and people

would say, "Yes, but the capabilities

have gone up in turn, and I acknowledge

that.

But the problem with the per unit

pricing being as high as it is is what

Freeburg says is going to happen. AI

rips open the canvas

of the devices that we will use to

interact with information and knowledge.

We are going to live in a much more

heterogeneous world in the future. It's

not going to be two devices and two

different operating systems that get you

to knowledge.

There's going to be all kinds of stuff.

Pens, orbs,

who knows, Jason? Your glasses,

whatever.

And so, the problem is if you get too

addicted to a single thing

that has an incredibly juicy profit

margin and great stickiness and the

ability to raise price,

it's a hard drug to get off of. So, I

think really what John Turnus has to do

is figure out how to move to this world

where everybody will be launching

umpteen devices

via MCP or otherwise,

all of these services will be open.

It'll be agentically talking to

everything. I think the most decay.

And I think if that happens, that's

problematic if you're too reliant on a

single thing to kind of keep it going.

>> Yeah, and just expanding on what you

said, like wearables is where they

really uh made some good inroads in

terms of getting people to use them,

whether it's AirPods or the watch. And

the next wearable, like this is an

applaud pin that I use to record. You

can put it here, put it on your wrist.

That AI synchronicity of having your

eyes, having your ears, having your

watch, having your phone, your desktop

all sync together with AI could be a

huge product line. I'll also add a

fifth, robotics. You know, the I think

to I think Steve Jobs, if he were alive

today, would have been looking at

Roomba, he would have been looking at

Optimus, and he would have said, "Hmm."

>> [clears throat]

>> Consumer robotics, in addition to a

consumer car, those are two things I

think he would have absolutely uh

executed on at a high level. Okay, let's

keep moving here. Uh

>> Just come and come and one last point.

>> Chamath, we'd love to have you on the

pod, John. So, just come on the pod when

you're ready. Uh we'll have you come sit

in. Go ahead. Sachs, you get the final

word.

>> This one last point on this is that I

think the succession at Apple

is reminiscent a little bit of the

succession at Disney.

And apparently

Steve Jobs and Tim Cook had this

conversation back when Steve was alive

and and Steve

told Tim, "Don't do what Disney did."

Where basically after Walt Disney died,

the company kind of languished because

it felt so beholden

to Walt's vision that they never really

iterated. Now, when Walt died, his

brother Roy took over and Roy was

already in the business. He was sort of

like the business co-founder. He was a

COO type, a little bit like Tim Cook.

And he kept the magic going for about 5

years and then he himself died. I think

it was around 1971. And then you had

this string of CEOs who took over were

kind of uninspired and it wasn't until

Eisner came in in 1984 that he sort of

revitalized the business.

And so, as I understand it, Steve and

Tim had this conversation.

And Steve told him, "Don't be too

beholden to my vision. You need to

figure out your own and extend it."

I think that, you know, you could argue

that Tim in a way was like the Roy

figure here. Very effective business

partner

of Steve. He got a 15-year run. Roy only

got five and I think again, he added a

zero to the value of the company. The

market cap went up over 10x. So, you

have to say fantastically successful run

as CEO. I think the question now for

John Turnus is, "Okay, you're now past

let's say the the Walt Disney and Roy

Disney part of the business. Is it going

to be like the 1970s

Disney or is it going to be more like

the 1980s? Do you figure out a way to

revitalize it or do you have to go

through

uh you kind of a funk first?

>> Mhm. Yeah, and if I I think it's like

really illustrative of this discussion,

Eisner and Iger. Cuz Eisner's innovation

was he realized that Disney was uh I

think he called it the vault strategy.

He would and we probably remember this

from our childhoods, he would re-release

all into theaters all of their IP every

7 years. You couldn't get some of those

Bambis, whatever.

Snow White and the Seven Dwarfs, you

couldn't get those products except in

theaters and he figured out a cadence to

keep publishing. But then Iger came in

and said, "Hey, what if we use this

balance sheet and we use this

distribution at the parks uh and you

know, with their brand

to buy Pixar, Marvel,

uh and Star Wars." And so, there's

multiple ways to do it. There might be

something there in terms of

acquisitions, bold acquisitions with the

Apple balance sheet could be super

accretive to shareholders as opposed to

lowering share count and just

distributing a ton of cash. All right,

listen. We're going to talk about the

Southern Poverty Law Center racism

corner. Let's go to race Fake fake

racism corner.

>> I want to know how the SPLC managed to

accumulate 822

million dollars in offshore bank

accounts.

>> Yeah.

>> This is incredible. These are big

numbers. Okay, SPLC

>> How was that possible? What is going on?

>> All right, let me tee it up here for the

team.

>> It's like one of the biggest grifts of

all time.

>> Anyway, Jake has to do it. This is a big

one. SPLC has been indicted indicted,

not found guilty yet, on 11 counts of

wire fraud and money laundering. Keep

that in the back of your head. Wire

fraud and money laundering. Here's the

core allegation. Between 2014 and 2023,

the Southern Poverty Law Center used

hidden bank accounts to funnel 3 million

in donor money to paid informants.

Like these are confidential informants,

like the police or FBI might use. They

use these as a non-profit NGO to

infiltrate hate groups. And so, the

official mission of the SPLC

is, quote, to be a catalyst for racial

justice in the South and beyond, working

in partnership with communities to

dismantle white supremacy, strengthen

intersectional movements, and advance

the human rights of all people. Okay,

sounds great on paper. Examples of

organizations they were trying to

infiltrate great KKK Aryan Nation

neo-Nazi groups, and the Unite the Right

organizers. Proud Boys, labeled as a

hate group by the SPLC. Oath Keepers,

not listed as a hate group, but part of

the militia movement. My friend Sam

Harris, he was not listed as a hate

group, but he was also pinned by the

SPLC as, like, hate adjacent in their

Hate Watch headlines. And this is

something that I had a major problem

with this organization on, which is they

would just very loosely label people as

hate speech and try to get them

canceled. All of this kind of came to a

head. The revenue before

Charlottesville, you remember the

incorrectly clipped uh Charlottesville

hoax, where they said Trump said both

good people on both sides, but they

didn't give his full quote. Very unfair

to President Trump. Uh we found out

later.

And that was the reason Biden

of course ran. He said the

Charlottesville both sides thing was his

inspiration. 58 million in 2026, to your

point, Chamath. Doubled and spiked to

136 million, more than double. And it's

remained elevated ever since. Here are

some, you know, images. For the

indictment, and I'll wrap on this and

then get everybody's uh feedback. They

had F-37 as one of their confidential

informants. He was a member, and this is

according to the indictment, quote,

member of the online leadership chat

group that planned the 2017 Unite the

Right event in Charlottesville,

Virginia, and attended the event at the

direction of the SPLC.

F37 made racist postings under the

supervision of the SPLC and helped

coordinate transportation to the event

for several attendees between 2015 and

2023. The SPLC secretly paid F37 more

than $270,000.

That's the legal case here. Let me pause

there.

>> Can I add one thing?

>> Sure, keep adding. There's a lot of

detail to this case. Yeah.

>> Yeah, so you're right that the SPLC

allegedly did fund $270,000 to help plan

Charlottesville. In addition to that,

they secretly funneled more than $3

million

to

to a bunch of violent racist extremist

groups including the Ku Klux Klan, the

American Nazi Party,

Aryan Nation,

United Klans of America,

and it goes on from there. So, I think

don't forget about the $3 million bucks.

So, this group that was supposed to be

fighting racism in fact was fomenting

racism by paying these groups to

basically organize protests

that SPLC could then point to and say

that America has a huge racism problem,

donate to us. And that's basically what

happened after Charlottesville.

They increased the amount of money that

they were able to fundraise by $81

million. So, that $270,000 investment

led to an $81 million return, pretty

good. But this is kind of the whole

point of the story is that these guys

are basically running a grift. And one

of the ways that you know this is a a