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I just got a haircut with a new person. She was like—I'm like, “Do what you want.” This is what she did.

Okay. Let me know who she is. Chamath and I will go beat her up and get your money back. Did she feather your bangs and blow your hair out? She did. She gave you a blow, didn’t she?

It’s starting already. Okay.

No, but that’s a blow-dryer. She blow-dried your hair?

At the end, she gave me a little blowout.

Yeah, that’s not sustainable, so you can’t tell what the quality of the haircut is like, because you’re never going to do that again.

You don’t have the skill. I’ve never blow-dried my hair in my life.

No, I understand that, and this is why: if you get the blow and it looks good in the blow—

Just say “blowout,” please. Just say “blowout.”

Why? What are we, 6? Just grow up, you ding-dong.

The way you’re saying it, you’re saying it to provoke a reaction. Come on.

No, I’m not.

Such a liar. I love it.

Tell us about your rules for blows.

What I’m saying is, if you get a haircut and you get a blow, it’s very hard for you to know what it’s going to look like the next day when you take a shower and don’t blow it.

It’s true. Oh, you’re saying the self-blow can’t match the stylist blow.

It’s just important when you get a haircut with a new stylist, hairdresser, or barber—

Yes, yes.

—you cannot let them blow you.

He’s not happy with the ending.

Got it. It was an unhappy ending, because when you blow yourself, Chamath—which people have accused you of doing on this very program—it’s not going to come out the way it did. It won’t be as fabulous.

Every time I’ve blown myself, it’s been perfect.

We’ll let your winners ride. Rain Man, David Sacks. Instead, we open-source it to the fans, and they’ve just gone crazy with it. Love you, Wes. I miss you. Queen of quinoa.

All right, everybody, welcome back to the All-In podcast. I’m your host, Jay Powell, from Japan.

Jay Powell.

Cutting turns in Niseko and at Iwanai, and we have an incredible lineup today. As always, the chairman dictator, Chamath, is here to reign supreme. How are you doing, brother?

Good. How are you? What are you wearing exactly?

I’m just wearing my kimono, as I am wont to do here on the All-In podcast.

Why are you speaking in Elizabethan English?

I just decided in 2025 I’m going to live my best life, and I’m going to do everything anybody asks me to do. I’m saying yes—

Oh, I’m going to ask you—

—if it’s something incredible.

—a bunch of stuff next weekend, then. I’ve got so many ideas. I’ve got a list. I’m going to ask you to do all sorts of things.

If it’s epic, I’m doing it.

Yeah. Okay.

I’m over the moon right now, and then I’ll be going to the inauguration to see all my friends, celebrate the big Trump victory, and tape an episode there.

With us, of course, David Friedberg, your resident sultan of science, and not a moment too soon. We have so much to talk about. What’s the background here? Those are some dead trees with Mount Fuji in the background?

Yeah, that’s a Kuros—

Basically, Jason—

—Kurosawa landscape.

—while you’ve been gallivanting and being a dilettante—

Yes.

—your original adopted home state is burning to the ground.

Ah, yes, I know about this. I got off the ski lift, and I saw this after I had posted, like, “Oh, my life is amazing,” and I was like, “Oh my God.” You can totally—

You were torn down.

And everybody replied, like, “Are you—

—read the room?” And I’m like, “Oh my Lord, this is unbelievable,” and we’ll obviously talk about that a whole bunch.

So then you promoted the tweet?

Yes, I put $500 behind it to boost it and try to get my ratings up. No, I actually deleted it, because I posted a video where I was like, “Oh my God, it’s incredible,” and I was like, “You know what? This is the wrong time for it.” So, a little grace there, folks.

I am so happy to have here on All-In, the one, the only, my good friend Cyan Banister.

No, our good friend.

She was my good friend before you guys met her. So sure, she’s ours, but I’ve been friends with her longer. My good friend Cyan Banister, our good friend, and our bestie. Let’s just leave it at that. It doesn’t have to be a competition for who Cyan likes best.

She’s a bestie.

We’ll ask her to rate us at the end of the episode. Cyan, welcome to the program.

Yeah, thanks for having me. I appreciate it. It’s nice to see everyone.

Jason, you want to tell people about Cyan’s background?

Yeah, do an epic rant on Cyan’s epic history.

Well, Cyan and I fought in the Clone Wars together. It was a long time ago. She’s a technologist, a self-made individual who then decided she would start writing small angel checks about 14 years ago—literally the same year I did—

She’s done profoundly better than you. Let’s just be honest.

She’s done incredible, yes, of course. We’ll get into it. Cyan and I, 14 years ago, would meet startup companies together and host little events where we’d get together, take pitches, and invest in a couple of companies together. It worked out very nicely for everyone involved.

Yeah, we’re in a couple of companies together.

Density.

Density. We were on the board together for a little bit, and so that was fun.

A little bit, yeah.

Yeah.

Thumbtack.

Thumbtack.

Yeah.

Actually, Thumbtack, Density, and Uber—I discovered all 3 through you.

Which one was Uber? I’ve got to check my—

I don’t think you’re allowed to say them.

Let me check my Google Sheet here. I didn’t know I invested in Uber. Let me check. I have to confirm that.

I don’t think you’re allowed to say them.

Oh, yeah, I did. I did. At one of these events, I introduced Cyan to Uber. It’s true. Sorry, that’s right.

Yeah, so I found all 3 of those deals at your events, so that was really great.

Aw.

Yeah.

Well, thanks. That’s very nice of you to say.

Let me try. Cyan is a prolific angel investor.

Correct. I just said that.

She was a part of Founders Fund.

Oh, right, yeah.

She runs a seed fund called Long Journey Ventures. Some of her hits include SpaceX—

Oh, yeah, Density—

Yep.

—Postmates—

Yep.

—Niantic, which is the maker of Pokémon Go, and Jason’s favorite startup, Uber. It’s been a good run. It’s been a good run. I’ll also add that she’s a wonderful human being, and if you ever have the chance to hang out and talk for a couple of hours, Cyan would be one of those people you’d put right at the top of the list.

I will promote Cyan’s interview with Tim Ferriss a couple of weeks ago.

Oh, yes.

I randomly turned it on. I was in the car driving home, and then I stopped in my driveway and kept listening. I was just telling Cyan—it was a fantastic interview. What was it, about 2 hours, 2 and a half hours?

3—well, it was 4 hours—

4 hours.

I think he cut it to 3 and a half, yeah.

And then I had to drive again. I listened to it. It was—I was excited to get back to it, which never happens for me listening to long-form interviews like that. It was phenomenal, so I recommend it to everyone.

Why?

A couple things. One, Cyan is an incredible storyteller. The way she describes her experiences, her history, and her life is beautiful. She talks in a deep, persuasive way about some of the things that have shaped her business, investing, as well as spirituality, which she mentioned earlier, and that’s not something that you’ll typically hear. You’re like, “Wait, where did this conversation just pivot to?” Then you go down this whole other path with her, and you go on the journey with her. I just thought it was great. It was all over the place.

Huh.

It was great—beautiful. I recommend it to everyone to get to know Cyan.

Oh, thanks. Can I have you all as my professional cheerleading squad from now on? This is pretty awesome. I don’t like talking about myself, and this is great. I love it.

Yeah.

Well, it’s true. Cyan was voted most humble in our angel investing group, and I was a close second, so I almost won most humble in the group. More work to do being humble.

I’m going to get you a T-shirt called “The Humblest.”

No, no, you have to borrow it from Chamath.

Yeah.

He’s got it. He’s had it for the last 10 years.

Yes.

7 or 8 years ago, Jason approached Cyan and me and said, “Hey, guys, Harvey Weinstein has asked me to make a show.”

Yes.

It’s a true story.

Here’s how he asked me to do it in his room. It was really—

It’s a true story.

Oh, dude.

Apparently.

Should take it down a notch.

Cyan, myself, and Jason went to some place in the city, and we taped a—

We taped an episode. I have it.

What is the first episode called?

A pilot.

A pilot.

We taped the NBC pilot for The Accelerator, or for The Incubator. I had been approached and did a pilot for NBC called The Accelerator. They spent, like, a half million dollars on this, and you guys came on, and it came out great. It was just going to follow me around angel investing.

Well, it was very awkward because afterward they approached Cyan and me to do the show—

Without me.

But they wanted to do it without Jason, so we had to decide, and we decided—

Friends like you, Cyan. Who needs enemies?

Exactly.

I don’t know if I ever told you guys this story, but literally they were figuring out where to put this and what time slot. They were like, “We’re going to do it in the summer, because we’re trying to get some summer programming going. That’s where we’re going to test stuff.” Then Harvey Weinstein turned out to be a horrible monster, and the whole thing got canceled. Anything that was anywhere within 100 miles of Harvey Weinstein got canceled, including my failed—or forgotten—reality TV show.

1. Wildfire Preparation Failed

All right, let’s get to more important things. There is an unbelievable tragedy occurring in Los Angeles. As we’re speaking, devastating wildfires have basically formed a ring around LA, the most destructive of which has been the Palisades fire, which has stretched into Malibu. Around 15,000 acres have been burned in that area, along with thousands of homes—maybe 2,000 homes. Here are some images. They’re just devastating, and we have a lot of friends in this area.

The area you’re seeing on fire, if you don’t know the topography of Los Angeles, is north of Santa Monica. You have the Palisades and then Malibu, and obviously east of the 405 you have things that you’ve heard of, like Bel Air and Brentwood. This area is part of a mountain area called the Santa Monica Mountains, and they get very dry. There’s a phenomenon, which we’ll get into, called the Santa Ana winds that blow really, really strongly. A perfect storm has happened where thousands of homes and, tragically, 5 lives—and I’m sure there’ll be more, unfortunately—have burned down.

This is video of driving down PCH. If you’ve ever driven PCH, the Pacific Coast Highway, these are $10 million, $20 million, and $50 million homes that are literally on the Pacific Ocean. The most coveted homes in Los Angeles are not Bel Air and Brentwood. You might think that because you hear them on TV, but really, if you were an incredibly successful person, you would aspire to live in the Pacific Palisades, just west of Brentwood and just south of Malibu. Many celebrities live there, many executives, et cetera, and these homes are gone—thousands and thousands of homes.

This has turned into the ultimate Rorschach test on social media, where people are projecting into this tragedy, which tragically occurs every year to varying degrees, and maybe every 20 or 30 years it’s an acute situation. We’ll get into that in a moment, but looking at this absolutely devastating loss of property and lives—the lives could have been a lot worse—Friedberg, from a scientific perspective, maybe we’ll start there. When you look at these wildfires, extreme weather, global warming, and you look at this situation, is that where your mind goes? In this Rorschach test of how you feel about these kinds of tragedies and how you interpret them, do you go somewhere else? The incompetence of California’s government, DEI, Ukraine—I mean, everybody is superimposing on this natural disaster whatever their pet issues are. Where do you come to when you look at this?

I don’t think that those are exclusive. I think that you can have had both incompetent planning and execution by leadership, as well as uncontrollable circumstances that management and planning weren’t necessarily going to solve. I’ll talk about a couple of these points real quick.

First of all, we talked about when the hurricane hit a couple of months ago, remember? As you guys know, I have an office or facility out in Asheville, so we were exposed to the flooding circumstances, and we talked about the frequency of that sort of an event, having been such a rare occurrence, becoming more common. Similarly, we’re seeing more frequent high-wind events in California, flooding events in California, and extremely hot events in California.

If you look at this link I sent out, Nick, in terms of the total precipitation over this current, what’s called rain season, the Southern California region is basically at—call it 0% of normal. This is Southern California. You can see that third column. That’s the percentage of normal rainfall that has been experienced. There’s been 0 rain in these regions. Everything is primed to be very dry, and then you get these Santa Ana winds—100-mile-an-hour winds. No matter how much underbrush you clear out, no matter how many trees you remove, if there are some embers in the air and there’s a 100-mile-an-hour wind, that is going to create a fire hurricane, and a lot of homes are going to catch on fire.

So it’s very hard to just pin the blame solely on not doing underbrush clearing or not removing trees. Those should have happened. They didn’t happen. That was wrong. That was bad policy. But it doesn’t excuse the fact that there’s a natural event that happened here that seems to be occurring with greater frequency. The thing I’ll pivot to, if we want to get there now—maybe we’ll talk about that in a minute—is the economic and policy issues with respect to the Department of Insurance, because I think that—

Okay, let’s get to that after we go through maybe a little bit of the quick reactions here.

Okay, yeah.

I think that’s where there’s going to be real pain and devastation, and that’s the biggest economic consequence: the role that insurance has played in all this stuff, which we’ll get to in a minute.

Okay, so Chamath, I think, as table stakes, we all agree that global warming and extreme weather—depending on what degree you believe in it—play some factor here, and this is something that has recurred over and over again in this specific region. But on social media, we’re seeing a lot of other interpretations of this event. Maybe your thoughts on some of the other interpretations, and then, when you look at it, what do you start to think about preventing this in the future, or maybe who’s responsible? What’s your general take on what we’ve seen in the last week?

2. California Failed To Prepare

I’m not very sympathetic to the “There were 100-mile-an-hour winds” argument. Not because it’s not true, but there’s been enough modeling that we know these kinds of outlier weather events are happening with greater and greater frequency.

Nick, maybe you can find this and just put it up here, but remember that crazy apocalyptic video of that exact same part of Southern California in 2018 burning to the ground? Can we just look at that, all of us collectively? Because that was 6 years ago. This is not like it was a distant memory from 100 years ago. We knew in 2018 that these types of—

Oh, the Sepulveda Pass.

So this idea that we were just lollygagging around and got caught off guard by 100-mile-an-hour winds, to me, is completely not an acceptable answer. We knew in 2018 that these things could happen. We knew across the rest of the United States that these outlier weather events were happening with greater and greater frequency.

If you weren’t sure, you saw most of the insurance companies try to dump Southern California home fire coverage 3 months before this event happened. All this data was in the realm of the knowable. When you double-click and get into a little bit more of the details, there’s a level of incompetence bordering on criminal negligence here that we need to get to the bottom of.

I’ll just give you a couple of facts. In the 1950s, the average amount of timber—so, wood that was harvested in California—was around 6 billion board feet per year. In the intervening 70 years, that shrank to about 1.5 billion board feet. You’d say, “Okay, well, that’s a 75% reduction. We must be making a very explicit stance on conservation.” It turns out that’s not entirely true, because what it left behind was nearly 163 million dead trees. Dead, like gone.

You’d say, “Well, those things should have been removed.” The problem is that then there’s this California Environmental Quality Act, CEQA—hopefully I’m pronouncing this right—and a whole bunch of these other regulatory policies that limited the ability of local governments and fire management to clear these dead trees and vegetation. I think that’s a really big deal.

When you double-click on that, here’s where you find the real head-scratcher, okay? Multiple bills—AB 2330, AB 1951, AB 2639—all rejected by the Democratic-controlled legislature, or worse, vetoed by Governor Newsom, that would have exempted these wildfire-prevention projects from CEQA and other permitting issues.

Then there were other bills to try to minimize the risk of fires by burying power lines underground. SB 103, as an example, went nowhere. It didn’t even get to the governor’s desk.

So I'm just a little bit at a loss to explain these 2 bodies of data. One is: everybody can see that these events are happening. Southern California lived through this exact type of moment just 6 years ago. All the bills that are meant to prevent this are blocked or vetoed. This is the ultimate expression of negligence and incompetence.

Okay, Sayan, you've heard Chamath and Friedberg's take here. Some amount of incompetence, some amount of, “Hey, this keeps occurring, and there might be some global warming that is contributing to it.” What do you take away—

Yeah.

—from this situation?

Sure. I think I agree with Friedberg and Chamath. It's a lot of everything. But I also think that, to add to the prevention part, other than clearing out underbrush and trees and things like that, we don't build things in the state of California in a way that houses should be built when you know that there are fires like this. For example, we have more wooden roofs than we really should have. We should really evaluate the materials that we're building things out of.

But we also have, down in El Segundo, this company that I invested in, Rainmaker. We have the ability now to cloud-seed and do preventative measures to actually make a region have more water. I don't understand why we're not looking into things like this. We knew that this storm was coming. We knew that these winds were coming. Southern California shut power down.

I have a farm down there. We still don't have power because they knew that most of these fires are started by PG&E or downed power lines, and so they proactively shut everybody down. We're still running on generators. And if you notice, there are no fires down there.

Right.

Sayan Navaratnam

But they also have 100-mile-per-hour winds.

Yeah.

Sayan Navaratnam

And you're not seeing it, and there's plenty of mountain ranges and dryness there. Avocado farms are basically just sitting fuel. I do think it's a combination of all of those things. Incompetence is definitely one of them.

Yeah. I actually lived right next door to this area for a long time in Brentwood. And to your point about roofs, it seems silly.

Sayan Navaratnam

Very silly.

A lot of these prevention things can seem silly when you first mention them. Let's face it: the way Trump says things sometimes is very colorful. When he said, “Listen, you're not raking like people in”—wherever he said it, Scandinavia, Finland—“are raking the forest,” he was absolutely 100% correct on that. Maybe it sounded bombastic or silly when he said it, but the truth is, in Tahoe, where we just were over the holidays, people are clearing underbrush.

Sayan Navaratnam

Mm-hmm.

When I lived in Los Angeles, people who lived in the Hollywood Hills would get a fine if they didn't clear it. But there are mountain ranges that nobody owns. And when you showed Sepulveda Pass, that's the 405 going past the Getty Center. That area has got to be cleaned by the city and the government, and maybe they weren't doing it as much.

Look at this. This is apocalyptic.

Yeah. I know this pass very well because I would drive through it—

Jason, what did California learn from this? What did Gavin Newsom implement based on what happened here?

Yeah.

What did the city of Los Angeles implement based on what happened here? I want to specifically know the answer to those 2 questions.

Yeah, and I think that's going to be a big part of this breakdown after this happens because, in a lot of these cases, you might lose a home or 2, but you haven't had this kind of wholesale destruction in a while.

When I lived in Brentwood, I had a shake roof. That's a fancy way of saying shingles—wood shingles—and they would bake in the sun. I loved this roof, but my neighbors in Brentwood were all 70 or 80 years old. I was right on Sunset Boulevard, and I could look up from my house and see the place you just showed, which is the Getty Center, the Sepulveda Pass on the 405, and Sunset Boulevard.

I was only allowed, Sayan, to replace 30% of my roof at a time. You couldn't replace it and put shake roofs on. You could only maintain it. Because in 1961, there were the Bel Air and Brentwood fires. And when you talk about these fires in memory, Chamath, this one—Zsa Zsa Gabor and tons of celebrities lost their homes as well.

This one was started because of the Santa Ana winds, and somebody was just burning a rubbish pile. I think it was some construction workers who were burning that. The neighbors said to me, “Do you know about the Bel Air fire? You know about the Brentwood fire? You gotta get rid of that shake roof. You gotta get rid of that shake roof.”

When my daughter was born, the roofer said to me, “Let's put composites on.” I put composites on, and he said, “What do you wanna do with the sprinkler system?” And I said, “There's a sprinkler system in my little one-story ranch house?” He said, “Yeah.” I said, “I've never seen it.” And he showed it to me. It was on the roof. People were so scared after that '62 fire that they were putting these on the roof. Wood roofs have been banned. You were grandfathered in. I was part of that. But there was a lot of PTSD from that.

3. DEI Blame Misses

Now I do think there's going to have to be some lessons learned. And let's get to where some folks online are pointing to maybe not having great priorities and maybe focusing on things that are not as important as the tax-paying citizens. A lot of tweets—I don't know how people feel about them—about DEI, about who's running the fire department, et cetera. Did you have any thoughts on that, Friedberg?

One of the things I wanted to talk about was the DOI's role, the Department of Insurance's role, in what I think will ultimately be creating a pretty significant economic consequence here from this sort of an event. But I'll answer your question.

I don't think that the mission of any public service organization should be to meet DEI metrics. I think the mission of that public service organization should be to serve the public, and I think that those DEI metrics should not be a priority when serving the public is the objective. The best ability to serve the public should be the objective, and that's it.

And I'll state that really clearly. So obviously, the fire chief in LA is getting a lot of attention. Whether or not that prioritization of DEI metrics took away from the interest and the focus in preparing for major disasters, I don't know.

There have been some interviews over the last day or 2, just to be fair, where she has claimed that they asked for more money, that they would not be able to be prepared for major disasters if the budget cut took place that was proposed by Bass. That budget cut did take place, and so the fire chief has said that she asked for budget to make the preparation for this sort of an event, and she lost it.

I don't want to just say, “Hey, she's to blame. She's to blame because she was focused on DEI.” But I will separately say that I think that creating DEI as a mission for an organization that's supposed to serve the public interest makes no sense.

This is an important one. James Woods, obviously the famous actor who lost his home in Pacific Palisades, has been going on a bit of a rant about Kristin Crowley. She is LA's fire chief. She also happens to be a lesbian and has made it a priority, and done a number of talks, to try to increase diversity inside of the fire department.

She also, just with a bit of research, is one of the top-performing firefighters: a paramedic, an engineer, a fire inspector, a captain, a battalion chief, an assistant chief, fire marshal, and deputy chief. When she took the firefighter exam in the late '90s, she scored in the top 50 out of 16,000. She seems eminently qualified.

There has been a massive pile-on attack on her, and on X and other social networks, people are really tweaked about DEI and are kind of putting the blame on her. What are your thoughts on this DEI angle, Chamath?

I don't think this is to blame.

Okay.

If, all of a sudden, because of DEI, 70% were physically incapable of carrying out the task, and that's why these fires grew, maybe you could make the claim that it is a DEI problem. I do agree with Friedberg that the thing these public institutions need to do a better job of is being very clear about what their North Star is.

I think the North Star for the fire department is to save people's lives and put out fires. I think the North Star for the police service should be to save people's lives, hold criminals responsible, and get them off the streets. And you should hire the people that allow you to do that job the best.

The thing to keep in mind is that there were probably 20 or 30 people interviewed to be fire chief. It's not her fault that she was selected. The real question is: what was she mandated to focus on once she got the job?

And I think what you see in all of these interviews is—I don't think that she, after growing up through the fire service, all of a sudden had this DEI bent. I think typically what happens is it becomes an institutional directive. It guides your compensation. It guides your recognition, and so you do it. It's sort of what Charlie Munger says: “Show me the incentive and I'll show you the outcome.” The entire public service is riddled with this.

The entire private sector is riddled with this.

Hmm.

We've lost the script about what is important. It's yet another example. She's probably quite a capable person who, if just allowed to focus on fighting fires and saving people's lives, would probably do a good job.

It seems like a lot of projecting going on here, Chamath. Yeah, I agree.

All of that said, though, I think you gotta go back to: How did these fires start? How did they grow out of control? Again, I think these winds didn't come out of nowhere in the sense that they caught everybody off guard. This has happened before. That area has gone through this exact moment.

Yeah.

There were laws that were proposed. They were vetoed, okay?

Yeah.

You see certain developers like Rick Caruso who were able to protect the buildings that they were responsible for because they took proactive and protective measures. Could those proactive and protective measures not have been taken more broadly through LA County? Of course they could have. Why were they not?

What we're seeing on the screen is Rick Caruso's village.

Let me ask a very specific question.

How much money—and we know the answer to this—did the government of California spend, poorly as it turns out, on homelessness? It was about $21 billion. And on illegal immigrants. I don't know what the final number is there, but I suspect it's in the tens of billions. If you reappropriated those dollars to these kinds of protective mechanisms in these areas, what would the outcome have been? Maybe there still would've been a fire. Maybe there would've been damage, but it's hard for me to believe it would've been as bad as it is right now.

Yeah, I think what you're getting to here is we can confirm lesbians didn't cause the Santa Ana winds to cause these fires, obviously. But there is an issue that I think many people in the public, especially in California, who voted for this very leftist, liberal ideology are now starting to realize: “Hey, wait a second. What are the priorities here, Chamath? What are we focused on, and what should we be focused on?” It's very easy to be focused on DEI and maybe things that aren't as important, homelessness, and move budget there. But at the same time, they wouldn't give her $17 million. They cut the fire budget. She tried to fight it.

Well, that's not clear. Now the counter-narrative is that she actually got an extra $50 million, Jason.

Okay. So we're in a breaking-news environment, so we'll see what the truth winds up being here. But, Chamath, I think the point remains the same: Is prioritization and what we focus on out of whack in California?

Oh, without a doubt. I think diversity is good unless that's all you have, and I'll just simplify it like that. I think it's very sad that somebody could be very qualified and be in a position, and we now have to question whether or not they were hired because of DEI.

It comes down to prioritization. When you're dealing with an organization like a fire department, whose main job is to protect the public, put out fires, and save people, any amount of time, as we know, is a valuable, precious resource that's being spent trying to roll out these programs. It goes beyond just who you hire. It's even the thought police of how you think.

It's so pervasive within an organization that you die from the bureaucracy of it.

Yeah.

Sayan Navaratnam

If anything went wrong with DEI, it was that they didn't have their eye on the prize of fighting fires, and instead—

Right.

Sayan Navaratnam

You're focusing on something that truly doesn't matter. You can be as diverse as you wanna be and not be able to put out a fire, and then it just really doesn't matter, right? You're not training people. You're not spending money on things that matter. You're not having the discussions that matter, and that's where I think it does fall apart. It has a place there.

I go back to what Chamath said, though. It really comes down to prevention and learning from our past. We seem to have a very short-term memory, and we forget very quickly because we rebuild and it looks pretty again, and everybody forgets. We just don't have the ability as a society to think long anymore, and that's a real problem.

I think we should learn from this fire. I really hope that what comes out of this is a shift in political leanings in this state. I think more moderates are gonna come to their senses, and, as we've seen with the election and the outcome, I think the state might shift some. We might actually get some policies that work.

You're so right. You're so right. When are we going to get tired of all this late-stage progressivism? It's like this litany of excuses. The people who are in charge have failed us yet again.

At a certain point, you have to wonder: Are we using politics and its purpose to make people's lives better and to have a high-functioning society, or is it a way to virtue-signal or to—

Oh, it's absolutely—

Share your opinions—

Sayan Navaratnam

A virtue signal.

On things. Yeah. I think what people are starting to realize is that, in an acute situation—whether it's our budget deficit, whether it's schools, whether it's safety from climate or non-climate-induced disasters—you do need to have competence. Rick Caruso is such a competent executive that when he ran for office there, the fact that he didn't get that job is absolutely crazy. You saw the mayor come in, and she wouldn't even address—she wouldn't answer any questions from the press, not even thoughts and prayers, or, “We're thinking of this,” or, “We're gonna get it done.” It just seems like we're hiring non-executives to work in functions that should be run by high-performing executives. This is an operational role.

Let me bring something that ties these three things together, and it builds critically on what Cyan said. There are so many good, hardworking people here that lost their homes. For many of these folks, it could be the single and only financially secure asset they have. For others who are family age and have kids, beyond the financial damage, they're totally displaced. Where will these folks go?

There was a commentary by Adam Carolla where he said the real test, to Sayan's point, will be how they internalize and metabolize this because it now affects them personally, and they have to wait 3 years for building permits to rebuild. Now, that's assuming that they can even get a reasonable amount of insurance coverage, which touches Friedberg's point.

This is the real tragedy. That is the actual tragedy multiplied by 12,000 or 20,000 families, and the real question is how much of that was completely avoidable. I think there is a reasonable amount of it that could have been. That's what really sucks, and that's where you cannot take your finger off the scale and forget.

4. Coastal Rules Block Rebuilding

And, yeah, when it lands on your doorstep—quite literally here—I can tell you, having been in this exact area, when you try to pull a permit to do anything, as I was explaining with my roof, the regulations are deep, expensive, and time-consuming. We talked about the California Coastal Commission on a recent episode, Friedberg. What are the chances that the California Coastal Commission even allows these people to build those homes in those locations on PCH, Friedberg?

I was—

I was talking to Chamath about this earlier today because the California Coastal Commission was created by the voters directly in 1976, and that commission has authority that exceeds legislative action. You would have to basically go back—my understanding is you'd have to go back to a state vote to rescind the powers of the California Coastal Commission.

They have effective complete authority over deciding what does or doesn't get built on the coast because their objective is to preserve the coast for the use of the community and restore it to its natural habitat. Any time there's a request or a permit request, it can take 2 decades, 3 decades sometimes to get anything approved, if they ever approve it at all.

For any property that touches the beachfront in California, they have this kind of God-level authority over it, and they're basically all political appointees that sit on the commission. To my question, Friedberg, what are the chances—yeah—that they allow the millionaires on Pacific Coast Highway in Malibu to rebuild those homes, or do you think they slow-roll it? Those people are all 50, 60, 70 years old.

They'll never be able to rebuild their homes. The California Coastal Commission commissioners will just slow-roll this and say, “You know what? Nature returned it to its natural state.”

I think we should talk about insurance. This is a great segue.

5. Insurance Becomes The Next Crisis

Yeah, this is the perfect segue. This is the key point I wanted to make about insurance.

Going forward, all of this property that sits in climate-sensitive zones or weather-sensitive zones, whatever you want to call it—like we've talked about on the coast of California, in Florida, in hurricane centers, in tornado centers—where the frequency of loss is going up, it's priced as if the frequency of loss were what it used to be. Let's say you buy a home for $1 million, and the probability of your home getting wiped out by a natural disaster is a 1-in-1,000-year kind of situation. So you have a 1-in-1,000 chance of your home getting wiped out each year.

So your price for insurance on that $1 million home should be about $10,000 a year, one-tenth of 1%. $10,000 a year for a million-dollar home sounds expensive, but it is what you have to pay for homeowner's insurance. But now let's say that the probability shifts to 1 in 20 years. So now you've got a 1-in-20-year probability of your home getting wiped out. Are you going to pay 5% of your home value? No.

If you have a $10 million home, are you going to pay $500,000 a year for property insurance? No. What's happened is the insurance companies have these models. They're called cat models, or catastrophe models. It used to be 2 companies: one was called RMS, and the other one was called EQECAT. I used to work in this business, so I know it pretty well.

Then all the companies started building in-house models, and now there are startups that make models. These models have shown that there is an increased probability of complete loss in a region because of the increased probability of these crazy weather events happening. So the price of insurance should go up.

Here's the problem: There are 50 state insurance commissioners in the US. In order to sell insurance in a state, you have to have the insurance carrier and the policy approved in that state, and the states determine what rate or what price you can charge for insurance.

The state insurance commissions have a couple of goals. Number 1 is to keep all the insurance companies solvent. They want to check the financials of all the insurance companies and make sure they're not writing too many policies that they won't be able to pay out. The second thing is they want to make sure that the insurance companies aren't ripping consumers off, so they have control over the rates and they don't want the rates to go up too much in any given year. They're controlling rates and keeping them down.

The third goal is to make sure that consumers have access to insurance. That's a very hard thing to do if you're trying to keep companies solvent, so you can't write too many policies, and you're saying, “Hey, you can't raise prices.” Meanwhile, the probability of loss has gone up, so the insurance carriers are saying, “What choice do I have?”

Earlier this year, State Farm pulled out of the Palisades. They stopped writing fire insurance in the Palisades. They canceled 1,600 policies in the exact neighborhood that just burned down. What about the timing of that, Friedberg? That was 3 months before or 6 months before this happened.

I think it was 6 months before.

But it's not just that. It seems crazy, but as you know, in Tahoe, a lot of the policies have been canceled. It's just crazy timing. It's a crazy coincidence.

Remember, in wine country, we had a lot of wipeouts. All of Santa Rosa was burned out a few years ago. You guys remember that? And so they started pulling out of there.

A lot of the carriers are generally pulling out of California because when they go up to the DOI and say, “Hey, we need to double the price of insurance. We need to triple the price of insurance. This is now a 1-in-20-year event,” the Department of Insurance says, “No, no, no. We're not going to let you charge that much to consumers.” Then the carrier says, “Okay, we have no choice,” and they exit the market.

Here you can see, 1,600 policies canceled. A big driver of this has been that the Departments of Insurance have made it very difficult to find this free-market outcome. But at the end of the day, 1 of 3 parties is going to end up eating the cost of the change in probability of loss that has occurred.

It's either the homeowner, because they're going to end up losing the value of their home in a loss, or they're going to need to write down the value of their home when they sell it to someone who will take on that risk, which means the price has to come down. Number 2 is the insurers, and there's not enough insurance capital out there to cover all these losses, so all these insurers would go bankrupt. Or the third is the taxpayer.

One of those 3 is going to end up eating the loss that's about to happen. You know the answer.

Taxpayer.

Taxpayer. Somebody's going to lobby somebody.

But we're sitting here, Chamath, in the age of DOGE and saying, “Hey, let's make the government smaller.” In fact, Dave, you and I were talking about Gangs of New York and the fire departments. It's crazy timing that we were talking about that 2 or 3 weeks before this happened.

When we look at making government smaller, that means these kinds of situations would put citizens more on their own. So let's counterbalance what you think, Chamath, about who should be responsible. We all espouse, I think, free-market ideology on this program and as executives and in what we do every day.

Should the people who own these homes going forward, who decide to rebuild them here, have to pay 5% or 10% of their home's value every year? Should their home prices collapse because it's too hard to build there? And should the free market take over this risk, or should it constantly be put on the other 329 million Americans who are going to have to bear the brunt of what happens to the million people affected in this area?

Well, “should” is a very strong word. The cap on the insurance reimbursement is about $3 million, is my understanding. David, you can tell me if I'm wrong, but I think that's right. The houses in the Palisades are anywhere from, call it, $1 million on the low end to maybe $40 million or $50 million on the high end. The average is $4.5 million in that ZIP code.

The median is probably more instructive, which is probably $7 million or $8 million. My point is that folks will get less than half their home value back.

They're going to have to come up with some amount of money to rebuild. But the cost of rebuilding a 7,000-square-foot house in the Pacific Palisades is probably at least $1,000 a square foot, so that's $7 million of cash.

It is.

Exactly. So now, all of a sudden, these people have to come up with a lot of money. And that's post-tax money, so you might as well double it because California is just so egregiously burdensome in terms of taxes. The individual homeowner is not going to be in a position to rebuild.

I think that the liabilities of the insurance claims are going to be so massive that the state is going to look to the federal government to bail them out.

My parents just got evacuated. I've got to call them. There's a new fire.

Oh, my gosh. Where are they, in the ballpark in California?

They're literally—there's a new fire called the Kenneth Fire. It just took off, and it's at their house. Just give me a minute. I'll be back.

Okay. No, do your thing.

Oh, wow.

Gosh almighty.

We were talking about maybe less government, maybe spending less. Now, the same group of people who were saying, “Hey, we need to spend less and reduce the size of government,” are saying, “Why isn't California more prepared?” Being prepared obviously means more money and more taxes. So you now have these 2 competing ideologies here.

But to the question of who's responsible, it is economically going to make no sense to rebuild unless you can get that insurance. It is a coveted place to live, but because construction costs have gone absolutely parabolic in California because of regulations, you're talking about $14 million in income to build a $7 million house. Maybe you're just better off selling the lot for $1 million and letting it be somebody else's problem going forward, and just taking the $2 million, $3 million, or $4 million loss.

Who should pay for underwriting these homes on a go-forward basis? A lot of these people paid for 30-some-odd years of insurance, thinking that their house wouldn't burn down, and then, of course, their insurance was canceled 2 weeks before their house burned down. The 1 time they need it, they don't have it.

A huge part of this is what Friedberg was talking about: the regulators. The free-market solution is the only solution.

I have an investment in a company called Kin Insurance, and they specialize in direct-to-consumer insurance for areas that are plagued with natural disasters. So their number one state—

Hmm.

Tim Draper

Out of the 11 that they serve, it’s Florida, followed by Texas, which has tornadoes and things like that. They’re able to get into these places and do insurance because the pricing is according to the construction of your home and all of these various things, and also weather models and data science—things that are not allowed in California, if you can believe it.

You’re not allowed to use a weather model to price in your decision-making for insurance in this state, and that just doesn’t make a lot of sense. You should be rewarded if you put the resources and time into your home to make it weatherproof, fireproof—

Fireproof. I mean, this is—

Tim Draper

You know, even earthquake-resistant, right?

This is more regulation layered on here to try to create equality. The fact is, it’s now working against the system. In Tahoe, to your point, they gave us explicit instructions around homes: Put stone and pebbles around your home. Cut the trees and bushes down around your homes. Do this over here. Your pool should act as this—

Tim Draper

Your premium could go down when you do that.

And if you do that—

Tim Draper

If you do that.

—which might cost $10,000 a home, it would keep these from jumping from one to the other in most fire situations. Friedberg, you’re back. Is everything okay?

It’s not okay. Listening to your 70-something-year-old parents evacuate their home and try to pack their cars with all their stuff in a matter of minutes while a fire creeps on their home is a pretty—

What are they saying?

—devastating thing to listen to.

Yeah. What are they saying?

They’re trying to get out of the house. They’re throwing everything in the car. There are evacuations like the—

Oh, Lord.

—I’m looking at the video right now, and the fire is right by their house. It’s insane. It’s literally—

This is crazy.

—blocks away from their house.

God.

This is the house I grew up in, in LA.

I’m so sorry.

Oh, man.

Gosh.

It’s blocks away.

This is—

And what do you say to them? Throw all the photo albums in the car, is what I said. Throw the photos. Just grab the framed photos. My mom’s trying to grab all her jewelry and stuff.

That’s the number one thing that everybody misses and that’s mentioned in every interview that I’ve seen: photographs.

Photos.

Tim Draper

Photos, all the memories.

I’m like, “Grab all the photos. Grab all the albums.”

Well, that—

And she’s grabbing her jewelry and stuff, and I’m like, “Grab the photos.”

We’re the last generation that will be thinking about this issue of grabbing the photos.

Tim Draper

Yeah.

It’s fascinating. I just want to say, as we wrap up this segment, obviously we’re thinking about everybody there. This is complex. This is not the fault of a lesbian firefighter or Ukraine or any of these other issues. This is leadership and nature and preparedness.

There are big issues around climate change. You want to believe them, you don’t want to believe them, fine—put that aside. But I can tell you that when I saw Karen Bass get off that flight—play the clip, Nick, of Karen Bass here, because it’s a short enough clip that we can play it here for the audience—I’m assuming all 3 of you saw this clip of her being absolutely unwilling to answer a single goddamn question about what’s going on. This is the opposite of leadership. Just 10 seconds of this absolute—

Tim Draper

“Do you owe citizens an apology for being absent while their homes were burning? Do you regret cutting the fire department budget by millions of dollars, Madam Mayor? I hear you. Have you nothing to say today? I’m getting back up—yeah, I appreciate it. Have you absolutely nothing to say to the citizens today?”

Disgraceful.

No, she’s in shock.

I mean, I have zero sympathy.

Tim Draper

Yeah.

You took the leadership job. I don’t give a shit if you’re in shock. You’re a leader. You sold yourself as the leader, that you were going to serve these people, and you don’t have the dignity, the honor to just answer the questions?

That is absolutely the worst leadership I’ve ever seen under fire.

Let me ask you guys a question.

Disgraceful.

What do we do?

6. California Needs New Leaders

You fire them all, and you vote for Caruso. You vote for executives who know what they’re doing and know what to do in a crisis because they’ve been under fire before, because they’ve run a business before, because they’ve seen the shit hit the fan.

This person—I don’t know her, I don’t know her history—but I’ll be totally honest: I wouldn’t trust her literally to pick up my lunch. If she can’t answer 1 or 2 goddamn questions and give a placating answer to a reporter—“Hey, it’s an intense situation. We’re working as hard as we can”—she can’t even say 2 goddamn words to the people who voted her in.

And for anybody who voted for this level of incompetence, it reminds me of exactly what we went through in San Francisco when I was living there in the Bay Area, when you put someone like Chesa Boudin in, or London Breed, or this entire clown car—Aaron Peskin, all these disgraceful desgraciados—

Marxists. The Marxists.

—Marxist lunatics who would rather virtue-signal. Dopey Dean Preston, the whole lot of them. You vote them out and you vote in executives. It doesn’t mean a Republican executive, it doesn’t mean a Democratic executive. It means an executive who’s run something in their life before.

Whether it’s Bloomberg, whether it’s Trump, whether it’s Caruso, it doesn’t matter what their ideology is. It matters whether they’re effective. And if you vote for ineffective people, you’re going to get situations like this over and over and over again. So use your brains and vote for executives who’ve done something in the world.

This is why I’ve changed my position on rooting for Trump now. I was a never-Trumper. Everybody knows that. But he put executives around him this time around, and I am rooting for those executives to do what’s right for the American people and solve big problems, not make them worse. It’s infuriating.

Timothy, what do you think? I think we need to have a wholesale replacement of the people who govern the state of California. It’s just not working.

Period. Full stop.

And I think the citizens who live in California need to do some real soul-searching. It’s beyond party politics. What has happened in California is that people vote for whatever vessel has the name Democrat beside their name or Republican beside their name.

You have to go back to first principles and do a better job of picking the people to represent us, because the people who are in positions of power just don’t fundamentally know what they’re doing. They’re not capable. And the fact that what we have to deal with then are lies and distractions to excuse incompetence, I think is unacceptable.

I think we pay way too high a price. Like I said, you are now dealing with hundreds of thousands of families whose entire lives have been totally disrupted and ripped away. I hope that we learn something from this, because we didn’t learn from it 8 years ago.

Hmm.

And we clearly didn’t learn from it when there was a different natural disaster in North Carolina. Will we find out that people said, “Hey, guys, is there an outlier natural-disaster event? Obviously, it’s not going to be the same thing in North Carolina, but could a different form of something happen here? What could it be? Are we prepared?”

I’m sure we’ll find out that they didn’t do that. Maybe they had different meetings about other total distractions or things that just didn’t matter. So this is what we need to do. We, as a populace in this state, need a reset. Otherwise, we deserve what we get.

Bingo.

Sacks, you agree?

Yeah, I think Democrats need to reclaim their party. I think there’s a lot more strength in the middle, and they’ve let this woke ideology—I call it woke imperialism—like a religion, take over in place of actually doing things that matter to the people who elected them, who pay taxes, who pay their paychecks, and everything in between.

It’s time that people really look in the mirror. I’ve got so many moderates coming to me saying, “People call me a Republican and I’m far right and I’m a Nazi.” And I’m like, “Yeah, welcome to the club.”

At some point, you’ve got to stop letting them run the board and stand up and say, “You know, enough’s enough.” We’re not building some railway that’s never being built. We’re not solving homelessness with billions and billions of dollars. We’re not doing this stuff anymore.

We do need real executives, to your point, Jason, to run things—people who understand how things work and the best use of funds.

Because right now it's misappropriated.

It's a crisis of competence. These are incompetent people. By the way, it's not just the leadership. It's also legislative action that's going to be needed to fix a lot of the policies, the regulations, and the way infrastructure operates in this state. And that requires 3 things to change.

Number 1 is the California State Assembly. Number 2 is the California State Senate. And number 3 is to put things in front of the voters that they can vote on to make the wholesale change needed to rescind some of the bad decisions that were made over the last 3 decades in the state that has led us to this point.

And I think that it's going to require, just like what happened recently in national politics, a state politics organizational effort to say, let's take a look at the composition of the state assembly, the state senate, and what are some of the votes that need to be done by the citizens to make the necessary changes in the state to try and get the world's 5th-largest economy to start acting and looking like it.

Because right now it's sort of like a weirdly disabled, 3rd-world-country-type operation with the wealthiest resources on planet Earth, and it seems pretty fucked up. It's almost like once people have it all, that's when they want to give it all up. That seems to be the moment that this state has just passed. Now maybe it's time to go reclaim it and build it back.

Well said. As we said in this segment, there are so many common-sense, tactical, strategic things that these people could be doing, that they should be doing, that they're not, and there needs to be a full-blown investigation. You kind of alluded to this earlier, Chamath, but if this is dereliction of duty, then we need to look into this in a very deep fashion.

And to the people of California, you have more power than you know. My friend who used to be on this podcast once in a while, he and I collaborated on Chesa Boudin being taken out as the DA in the Bay Area. I know some other people here were involved in it as well. And you can recall somebody, so recall these incompetent lunatics. Recall them and replace them.

You can. It's scary, but you can. They send all their people after you; they threaten you.

It gets personal. They went after you.

I was signature number 1, and I had to deal with the deluge of that stuff, but I've never been happier to do something and get civically engaged. I think it's so important that everybody starts getting involved in their local government, their state government, and the national government, because you can't just expect people to do the work for you and expect it to turn out well.

Mm-hmm.

And I think that's kind of the mistake that—

Well said.

—we all made.

We want to take some responsibility. The tech industry as a whole did not get as involved as we ought to have in the past, and I think we should get more involved, and we are.

Why wasn't that the saying? Why did, for 20 years, while we were all in the Bay Area, we just were too busy building companies, and it didn't seem—

I think we were busy building companies, and I remember—

Yeah.

—if I remember correctly, the only person I remember getting involved in local stuff was Ron Conway.

Yes.

And he would try to get everybody involved, and we were all just like, "You know, there's people who are smart that do that sort of thing, and they're going to do their thing, and they're running stuff—

Yeah.

—and we're just not going to get involved."

And then a lot of people would say, "I'm not political. I don't do politics. I don't..." They didn't get involved until it affected them, kind of like the houses burning down—it affects them. And there's that saying: first they came for so-and-so, and I didn't speak up.

Yeah.

That's what's happening here.

Yeah.

And I just really think that people need to realize it's now affecting them, and it's now time to make a change and elect better leaders.

Here's a framing. If you're paying 50% tax in California, you're a shareholder of an organization known as California, Inc. You're on the board of that company. You're paying the salaries of the people there. You have a say.

Recall these people. Start a recall of Newsom. Start a recall of Karen Bass. Just do it. I'm not doing it. I don't have time for this. I'm in Austin. But y'all in California, who are still in California, start a page: recall Newsom, recall Bass, and you have the power to do it, and you will succeed, I guarantee it. Now is the moment to strike.

There's other news we should get to. I hate to say "thoughts and prayers," but literally, I've been thinking about this all day long, and I have a lot of friends. My friend Mark Suster lost his home. I used to play cards with James Woods, and I just feel terrible for everybody who's lost their homes, and then their kids and their schools are burned down as well. All those great schools in Pacific Palisades are gone.

I could see developers coming in and being like, "Dude, if I could buy all these lots for 80% off, I will."

Oh, that's what's going to happen.

They're going to sit on them, yeah. They're just going to sit on them—

And sit on them.

—and wait for people to forget, like they did in 1962, et cetera.

The Rick Carusos of the world will do that, yeah. Anyway.

Yeah. He should be running the place. It probably would be—

I'll give you another California Department of Insurance stat. After the California Department of Insurance wouldn't allow the rates to rise like they should from a free-market perspective, they had to set up their own insurance program called the FAIR Plan for homeowners. It has about $220 million of capital in it, and then they bought about $5 billion of reinsurance. They have about $6 billion of exposure in Pacific Palisades alone.

Just like I told you guys about in Florida, the State Insurance Commission tries to step in and fill the market gap that they create by regulating rates, and then they don't have enough capital to actually fill the gap because the reason the rates want to go up is because the thing costs more than the state is willing to admit.

So they're distorting it. They're putting their thumbs on the scale, and they're distorting it even more, which creates a bigger crater.

They're driving real estate values up because they're not allowing the cost of insurance of that real estate to naturally float. And so by driving real estate values up, the economy looks good, they make property taxes, income comes in, but at the end of the day, the bill is going to come due.

Yeah.

And in the case of Florida and in the case of California, either the state government or the federal government is going to step in and pay the difference. And at some point, taxpayers are going to look at the fact that they're paying some percentage of their income to support someone else's home value, and they're going to say, "Enough is enough."

And enough of these sorts of events start to happen, and then the legislative change, I think, will happen that says, "This doesn't make sense. We have to make a change." And I think we're getting pretty close after this series of events.

7. Zuck Flips On Free Speech

All right. This has been an absolutely fantastic discussion. Let's move on to our next topic here. Zuck just fired Meta's third-party fact-checkers, and he is going to embrace the Community Notes model from Twitter/X, which predates Elon's ownership of the platform and is an open-source project, for those folks who don't know.

On Tuesday, he made the announcement in an Instagram video. He published a blog with a bunch of details, and he signaled that he was going to move the trust and safety team out of California, which he feels maybe was too far to the left, as we were just discussing in the previous story, and move it to the great state of Texas.

And here's a quote from his comments: "In recent years, we've developed increasingly complex systems to manage content across our platforms, partly in response to societal and political pressures to moderate content. This approach has gone too far."

If you remember, back in August, Zuck sent a letter to the House Judiciary Committee explaining how the FBI and Biden administration had pressured Facebook into censoring posts about COVID and Hunter Biden. You'll also remember that Zuckerberg has over 3 billion members on his platform and had no problem banning Trump from the platform after January 6. A lot to talk about in this topic, Cyan. What's your general take of Zuck going MAGA?

Yeah.

How do you interpret his—

I actually think deep down inside, he always has been.

—change of heart?

I go back to the beginning days of Facebook, when there were social networks competing. Back at the time, that was MySpace. The only political party you could be was Republican or Democrat, and then along came Facebook, and he added this third option called Libertarian.

Mm.

And I would like to go to the Wayback Machine at some point and find his profile because his profile said he was a Libertarian.

So when he started Facebook, that’s where he leaned. So I think he’s always been a free-speech person. I think this has been deep in his heart. I think what happened was he had enormous success, they grew very large, and he had to become neutral, or he thought he did.

And so I think what we’re seeing with Zuck right now, with his change in even how he appears, with a gold chain and how he’s dressing and everything that he’s doing, is him going back to his roots to be more authentic, because I think he hasn’t been authentic for a long time, and that was a big critique that people had of him. They were just like, “When he talks, he’s like a robot.” I think what we’re seeing is him coming out of his shell, and I don’t know if fighting helped it or what helped it, but I do think it’s the best thing to do, and all the platforms need to do it and should embrace it.

And it can be gamed, though. Community Notes can be gamed. We saw it with—I saw a report that Kamala’s campaign, or I don’t know if they directly worked for her or what happened, but they did take over Community Notes on X and started manipulating them. So you have to be really careful how you run a community, but in general, I’m all for it. I think it’s the right move.

It’s but one signal. It’s one system for trying to get to the truth. It’s not the only one. Fact-checking is another one, and having no system is another one. Chamath, you’re obviously an alumnus. You worked side by side with Zuckerberg in the pivotal years of building the Facebook platform. What’s your take on what Sacks said, and what do you attribute Zuckerberg’s massive 180 here?

I would start by saying I think he’s a phenomenal businessman. The results speak for themselves. But I also think that that is exactly what explains the shift. In many ways, he had to make that shift. I think it’s fair to say that in the Obama and Biden administrations, when the winds were blowing toward censorship, they were part of that machinery, and that was the value-maximizing function for Facebook shareholders at that time. Because if you pushed back against that, it’s not clear what would’ve happened to Facebook in other ways.

And so I think the decision, whether he morally agreed with it or not, almost didn’t matter. The leadership of the country in which I operate is telling me it’s going to go this way, so I go that way. Once the Biden and Obama administrations went by the wayside, there’s a very interesting picture that Donald Trump put in his book, and I just sent it to Nick. I think it sort of explains last week’s events relatively well, so I’ll just read it.

This is a picture of him sitting in the Oval, and it says, “Mark Zuckerberg would come to the Oval Office to see me. He would bring his very nice wife to dinners, be as nice as anyone could be, while always plotting to install shameful lockboxes in a true plot against the president,” in all caps.

Okay. Shout-out to the president.

He told me that there was nobody like Trump on Facebook, but at the same time, and for whatever reason, steered it against me. “We are watching him closely, and if he does anything illegal this time, he will spend the rest of his life in prison, as will others who cheat in the 2024 presidential election.”

Okay.

Now, that’s what he put in the book, and then he was asked about this quote at a recent press conference. Nick, do you have the link to that?

He’s colorful, Friedberg. Did you notice? Donald Trump, a little bit colorful.

Yes.

Essentially, Trump was asked about Zuckerberg’s move to free speech. He was asked, “Do you think it was because of your threat?” And he goes, “Yeah, probably.”

Yeah. I watched their news conference, and I thought it was a very good news conference. Honestly, I think they’ve come a long way, Meta.

Do you think he’s directly responding to the threats that you have made to him in the past?

Probably.

Wow, there it is.

But again, the lens that I would put on this is that now the winds are blowing in a different direction, and I do think it’s the value-maximizing function. I think Elon didn’t make a value-maximizing decision. He made a moral decision. He did it when it was unpopular and when the winds were clearly blowing in the opposite direction.

Now that those winds have changed and it’s clear Trump won in early November, the decisions you make in January are more reflective of the new conditions on the field coming into the inauguration. But I do think it’s the smart value-maximizing decision yet again for Facebook shareholders, and I think it begets a broader point.

When you see Elon operate, he’s a complete outlier in many dimensions, but I think the one dimension where it matters the most is that he acts morally and in the best interests of what he believes humanity benefits from. He’s always done it. He was willing to torch $44 billion when he bought Twitter in order to do it, and so he does these things from his own perspective. I don’t think there’s any other CEO that leads this way, and I don’t think they should necessarily.

I do think that Mark’s a good person, but his intimate feelings should be known by his wife, his children, his friends, and his family. I don’t think we as shareholders necessarily have any right to know. Elon is different, and I think it creates an expectation that maybe we’ll get that from everybody else. But I wouldn’t conflate everybody else with him.

So I think that this is a smart business decision. It makes a ton of sense, and as you can see, he was basically told to do this.

So he complied. Friedberg, your thoughts on Zuckerberg making this decision? If Kamala Harris had won, would he have released a statement or added Dana White to the board of Facebook?

Probably not.

Okay. There you have it, folks. Pretty straightforward here. Kamala wins, he would not have done this. He is jumping in front of a marching band, and he is the bandleader now. He’s got his baton, and he’s a frontrunner.

But it’s a smart business move. If you’re a Meta shareholder, I think you’re happy to see it.

Absolutely.

Is there anything wrong with it, J-Cal, or are you just saying it’s a point of character?

Yeah, there’s a tremendous amount wrong with it. It’s called moral integrity, having an ethical compass, having chutzpah, having your own sense of what’s right and wrong in the world, which he does not have, in my estimation, based on his behavior here.

Well, hold on. That’s not fair. You don’t know because, again, what I’m trying to say is we know—

I said based on my estimation.

No, but Jason, what I’m trying to say is Elon shares who he is in a 360-degree way with the world, so we know where he stands. And all I’m saying is what Mark does or doesn’t believe really isn’t known to us. It’s probably known to his wife and his family.

And his board.

I doubt his board even knows, actually.

Some of his close confidants.

Let me be clear.

Yeah.

I’m happy you’re challenging me on it. I base people on their actions. His action was to be the greatest censor in the history of humanity. There’s no human being who has censored more humans than him. That was his decision when it was a popular decision, whether it was COVID—

Not popular.

—or—

Hold on.

—popular.

But not popular, Jason. Necessary for maximizing his business in that moment.

Also, that’s under duress.

No, no, I disagree. His business would have been just as vibrant if he had a spine and he just said, “This is what I believe.” And I think he’s over-optimizing based on what he thinks everybody else around him wants, and I don’t know. I’ve never worked with him. I don’t know him personally. You’re right on that front, but he banned Trump for 2 years, the president of the United States.

I said at the time, “I don’t know that you can give a permanent ban to the president of the United States.” When he had the opportunity to reevaluate that decision, you know what he did? He punted. He created a third-party organization to make the decision for him and deflected.

Zuck created the Oversight Board. He’s so spineless, he decided, “I’ll create and give $150 million to this board to make these hard decisions for me instead of me making the decision.” He has super-voting shares at that company, Chamath. He controls it with an iron fist, and not only does he control it with an iron fist, he has put protective provisions in place so that his children could take that 3.3-billion-user platform and own it forever.

And he punted to them and said, “I don’t want to make these decisions.” What I saw when he did that was, “I don’t want to be blamed for these decisions,” and that is a lack of courage and morality in my estimation.

And anybody giving him his flowers or championing him for this, I think it’s just political expediency, and I think it’s disgraceful. That’s my feeling. Sorry.

What about the fact that he was dragged in front of Congress many times over, and people who could put him behind bars told him to his face many times—and this has all been coming out over the last couple of months—that government officials were directing him in a way that feels like, “Do this or you will be prosecuted”: to do the following things, to act the following way, and to moderate your platform in a way that we are telling you to moderate it, or you will find yourself behind bars?

Do you not think that there’s some degree of an inherently complicit role that certain government officials and folks in power had in driving some of those actions, that maybe he had to do it to survive and to keep the company alive?

Not to mention a violation of our Constitution.

No. Not at all. He could have just hired lawyers and fought it. He didn’t put up any fight. The second they told him to roll over and ban Trump, he did it. Zero fight from him.

Do you know that for sure? I just want to make sure I ask you.

I’m just basing it on his actions, like I told you at the beginning of this.

Well, you’re basing it on what?

I’m basing it on his actions.

Right, but I just want to make sure—

He was not going to jail for banning Trump. If he didn’t ban Trump or he gave him a 6-month suspension, he would’ve been just fine.

I’m just trying to get you to take a—

Yeah.

A fair point of view, which means let’s make sure you’re thoughtful about the fact that this is not a dumb person—let’s give him the benefit for a minute. He’s not a dumb person.

I do give him the benefit of being a great business executive. Yeah.

I’m just saying, let’s assume he’s not dumb, and let’s say that, as Sacks points out and as he’s highlighted at points in his history, he actually does have certain beliefs and certain systems that he would love to embrace. I’ve said this many times before: all of the founders of the big tech companies were big free speech advocates. That was a big part of the open internet and the movement of the open internet when a lot of people got involved.

Yes, he was part of it.

That was a big part of the open internet movement when a lot of people got involved. And I don’t know if you really think at some point he flipped his switch and said, “I don’t care about the open internet; I now want to have a closed, controlled internet,” or if he recognized or was coerced into controlling moderation on the platform because of the reach that he had, and he said, “The only way I can have any degree of openness is to do the following.”

And I will say that my experience is similar in Google. When Google had to exit China, they initially went to China with a closed internet, with a closed, censored model of search, because that was the way they had to survive to offer a business in China. They didn’t morally agree with it. They didn’t think it was ethically correct. But it’s what they—

Did they launch that, or did Sergey kill the deal when Eric Schmidt proposed it?

Well, that deal went live. Let me just make sure I get this all correct.

Nope. They didn’t go live. Sergey Brin, because of his upbringing in Russia, went to the mat and said, “On a moral basis, we’re not going to China,” and I’ve talked to Sergey about it. He did not want to go in there and—

Yeah, that’s right.

Compromise his own ethics. Period, full stop. So I don’t think that Elon—

That’s right.

Is the only outlier here.

No, that’s not correct. I’m—

You’re not right, and I just want to make sure that—

Okay, tell us. When did it—when did—

Dragonfly.

Because the Dragonfly project—

I’m just—

It was called Project Dragonfly?

There’s a long history to this.

Okay, let’s let Cyan come in here.

I want to make sure I get this right, but go ahead, Cyan.

Obviously, he’s a brilliant businessman, but I do think underneath it all, he is a human being, and I think his fighting in the arena and this fighting stuff that he does actually did change him, and this happened long before—

Ooh.

The First Amendment stuff started to appear. Free speech—I shouldn’t call it the First Amendment—but I do think that the government did interfere, and after January 20th, we’re going to find out some interesting stuff, and we’ll get to the bottom of how the government pressured him to censor things. I think he’s getting in front of that because it is going to come out, and I think that is a huge part of why he is getting more involved: it’s because it’s going to be revealed just how much the government coerced him. And—

And how much he acquiesced? Is that sort of what you’re insinuating?

Yeah. This is why I think the fighting actually helped. I think he learned to stop acquiescing.

Wow.

I actually think that—

Interesting. He put up a fight.

That is where I started seeing the change in him and started noticing it. He’s developed so many more fans and people who are looking to him as a leader in a different way now because he’s actually starting to express who he is and what kind of music he likes. Nobody ever knew that. They thought he was just a robot. He doesn’t like music.

He hired a whole PR team to craft this, is my understanding. But anyway, listen, I—

Yeah, I don’t know that much detail. I’m not involved in his personal life like that, but I always love to give people the benefit of the doubt. I guess that’s just me.

Yeah.

And I do think that people can change, and I’m hoping that he is actually going to stay on this side. We want more leaders like him to believe in free speech.

Of course. Of course. Listen, Reddit had—

By the way, they all do. I’ve never met an internet business executive who didn’t come from the open-internet philosophical doctrine by background. That was—

Yeah.

A big motivator for all of us, because the internet took away the controls, took away the power, took away the censorship, took away all these things that other communication systems had vested in them, and the internet, through an open protocol, allowed anyone to share anything with anyone else.

Obviously, laws and all this other stuff that’s happened since then has made that far more difficult, and I will revisit our conversation, Jason. Google in China, with censored search results, was live for 4 years before they canceled it. So they launched—

Yeah.

They launched in 2006. They censored results. They complied with the Chinese government’s requests, and eventually, in 2010, they killed it. You could argue it was because of philosophical reasons, but fundamentally, it never actually got a lot of users in China. There were more users on Baidu, and Google had separately made an investment in Baidu that worked out fairly well.

And I think it was Gmail that was the moment, if I remember correctly. This was 20 years ago, but I think—

I think it was YouTube.

Oh, was it YouTube? Because one of the other services, they started saying, “We need to know these people’s names—who posted this, who sent this email. We want full access to it.” And that’s where they drew the line, because it wasn’t just a passive search engine, right? It was actually to round up dissidents, like Yahoo famously did.

Well, Google claimed there was a hack that happened on their servers in China, and so they were just no longer comfortable operating in China.

How about this, guys?

Yeah.

However we got here—

We’re here.

We’re here. And we should all be happy that we’re here.

Yeah, exactly.

Yeah, I’ll take the win.

And we just move forward. How about that?

Taking the win is a good way to—

The world is a better place—

I don’t disagree.

Because of his decision.

Yeah, exactly.

I think we all agree on that. What’s the point of having an open platform and being able to say things in—

But why do you call him spineless? Why go after the guy? You know?

Why? Because you can judge a person when they’re put under pressure to make the right decision.

I think what Jason is expressing is sort of what I was trying to say, and I probably said it poorly. I think there are some of us who look at the way Elon runs himself and his companies as a sort of world-beating technology CEO, and then that sort of sets the bar. But I think that bar is impossible to meet, and I think part of it is because of Elon’s genius. The other part of it is his success. The other part of it is his influence.

But there’s a fundamental moral risk-taking, Jason, that he takes that has been rewarded over and over again, that no other CEO has had to make, and when they have, they’ve largely failed.

And so I understand where you're coming from, but I would give a lot of folks the benefit of the doubt here and say it's not clear what they believed then versus what they believe now. The destination is very good, and we're in a better place for society. Hopefully, we can maintain these norms independent of who's in charge after Trump.

I am super happy he's making these decisions. I believe in freedom of speech.

I think he's going to have to deal with advertisers next, though. That's one thing that X doesn't have to deal with as much, and that's going to be the second problem he's going to have—not just the government, but whether advertisers want to be next to some of the content that's about to appear.

Yeah.

Jason, would you meet Zuck in the octagon? That's the most important question of the day.

No.

No, definitely not. He's 10 or 15 years younger than me. He'd kill me. Not a chance would I meet him in the octagon, but I wish him well.

Would you meet Palmer Luckey in the octagon?

Let's not start that up again. We're just trying to let that die down.

I'm just wondering.

Yes. I actually literally challenged him. He wanted to send the Mountain. He wanted to pick somebody to fight for him, Trae from Founders Fund, and I said no.

Do you guys ever watch the old TV show American Gladiators?

Sure.

I would like you and Palmer to have an American Gladiators-style tournament, maybe 4 or 5 events.

Sure.

You know, you kind of get the most points.

Oh, that would be incredible. Put up 1 million dollars for charity, I'll totally do it. We'll put up 1 million dollars each for charity. I'll do it for sure.

Let's get the—

Put a charity purse up.

Word out there. I think this could be—

Let's end with something super world-positive here.

The show of the season. This would be more exciting than The Accelerator, I will tell you, if we did a—

Absolutely. It might get more ratings. Yeah. All right, listen—

You could actually call it American Gladiators. It would be a great show.

8. Nvidia Takes AI To The Edge

Well, there you go. American Gladiators: The CEO Edition. The Business-to-Business Edition. The Going SaaS— All right, listen, Nvidia is going consumer. Let's talk about it. Nvidia made a big announcement at CES this week. They made a lot of them. One of them that was particularly interesting was this $3,000 personal AI computer for researchers.

That's awesome.

It's called Project DIGITS, and it's essentially like—maybe Arduino would be a way to look at this—a personal device, but it's powerful enough to run LLMs on. They're also going after physical AI, like robotics and self-driving, as we said here on the award show. A lot of people on the panel were predicting this year would be the year of robotics, and they announced that they're going to have driver-assistance chips and maybe build worlds for people to simulate. Net-net, at the end of the day, I think Friedberg puts them on second—well, would put autonomy partners on second or third base in terms of creating technology by incorporating it into the chips and into their stack. So, Sacks, what do you think of these announcements and some of the other ones he made? I know you were excited to talk about this. Yeah.

Yeah, I'm really excited to talk about it because I've been trying to figure out how they justify their valuation over the long run. I'm not a public-market person, but I am fascinated with Nvidia, and their cloud GPU business is definitely a majority of their revenue. I think a lot of what we're seeing is them trying to grow into that and expand in case the music stops. Now, I don't actually think the music is going to stop.

It's insane to me. We've barely touched what AI is going to do and change and all of the various things that are going to come from it. The early adopters cannot use Claude without getting shut down because of scaling issues, and I don't think those are artificially created based on the type of investing I'm doing. I'm very bullish on Nvidia.

It is interesting to go consumer, and the thing that really hit me was the fact that he kind of declared Tesla one of the most valuable companies in the world in the long run. It's interesting that he got behind Toyota, but at the same time, I don't think there's a single car company out there that has the kind of data that Full Self-Driving and Tesla have.

Yeah.

If they enter the robotaxi market, I actually think they should buy Uber.

You think Tesla should buy Uber?

Oh, yeah, I think they should buy Uber.

Well, that would be about 10% of Tesla's market cap at this point. If they paid a premium, it might be 15%. It'd be very similar to the WhatsApp—

Which is kind of hard to believe, but it's true.

Yeah, it is true.

Then you launch that robotaxi service, and maybe there's some sort of secondary aftermarket solution, kind of like comma.ai or something like that, that you can do for people's cars, where you can actually get anybody's car into the fleet and start self-driving. But it is true: this is going to be the largest breakout in robotics we've ever seen, if Waymo's any indicator.

Yeah.

And I read somewhere, I think, that Amazon or somebody was looking at—oh, Lyft. Amazon was going to buy Lyft.

Yeah, that makes no sense, right? Why would you buy Lyft?

It doesn't make a lot of sense to me.

Well, it's a dying brand. I do think you're correct. We're going to see—

I think maybe delivery or something like that. I can't figure out what their play is there.

Well, it's not, and it's also not global. But looking at Amazon and Waymo, Tesla and Uber, I think Waymo plus Uber, Amazon plus Uber, or Tesla plus Uber defines who number one is, right? Because you'd have a global footprint, and for the 5 to 10 years—maybe 10 years—it takes to roll out taxis globally, you could have people driving. I mean, it's a really interesting thought process you have there, Sacks.

Imagine if there was an intermediary step where they sold slightly fewer Teslas this year than last year. You could just keep producing lots of Model Ys and—

Mm-hmm.

Give them to the Uber drivers, keep reinforcement learning going while the taxis and regulations get set, and then you would be able to put another— Instead of selling 1.8 million Teslas, you could sell 3 million Teslas, 4 million Teslas—

Right.

To Uber drivers, get all that data and have the safety driver in while each region decides if they want robotaxis, where, how, et cetera. Your thoughts, Chamath, on Nvidia dipping its toe into maybe taking the bottom 30% of the stack of self-driving?

I don't have much of an opinion on that, to be honest. I think that's sort of along the lines of what I said on the prediction show.

Sure.

I think Waymo and Tesla are going to run away with this market, and I think it's going to force a bunch of consolidation in the traditional auto OEMs.

Okay.

I think the interesting thing is that they really doubled down and created a pretty decent test bench for robotics. I thought that was pretty interesting, so I think that reinforces what a lot of smart people, including Friedberg and Gavin, also spoke about, just in terms of the long-term future for robots. I think that was cool.

I was a little confused by the low-end PC. I don't understand what the point of that is. Maybe it creates some crazy DePIN market where you can buy a GPU and then contribute it to some distributed network and allow some distributed workload to run on that, I guess. I don't know.

I think it's a toy, a hobbyist kind of device that becomes like a bridge, and we see this often in technology where somebody creates—like, even the original PCs, let's face it, they were kind of like toys and hobbyist devices. Arduinos and the original drones were kind of hobbyist.

But toy—

But, yeah, I guess the point is, a toy to do what? Because if you're trying to do inference, everything is telling us that we are reaching the limits of training.

That's in LLMs, though.

Right. But just give me—

Right? So the point is, it's not—

Let me get to it.

Yeah.

So, in this world of AI that we know today, there's training and there's inference, and right now we think that training is at a limit. So now the market shifts to inference. If you're going to buy this jacked-up personal computer, what are you going to use it for? My suspicion is some sort of test-time compute use case, which is an inference use case.

But it's not clear to me why that's a better solution than all of the AI accelerators plus tensor cores that are now just prolifically being exposed to the market, whether it's Amazon exposing what they've done, Google exposing what they've done, or a whole litany of startups exposing what they've done. So I was just confused. I don't really know what the whole point is.

What do you think, Freebird—

But like I said—

—about this new—

The robotics thing was interesting if the market develops in the way that they think.

So we're talking about maybe 2 or 3 different pieces here, Freebird. Which one do you think is super interesting, then? The $3,000 sort of GPU for your desktop that you attach to your computer, so you get to play with things locally. Do you think that's promising? Where would that go, if you had to guess?

So I think the bet he's making is that it's not just LLMs, which are predicting text, but we've talked a lot about machine-vision models and graph neural nets that are being used for weather forecasting. There are now these genomic language models that are trying to predict genomic output for biotech applications. There's also going to be real-time machine vision and robotic response.

We're working on this at Ohalo, and we're trying to figure out what's the right kind of runtime environment for these sorts of systems that are going to be using machine vision and a robotic-response system, and there are a lot of these industrial applications that are emerging. Let's say you're running a robot in a warehouse. Do you really want that robot in the warehouse to be sending data to the cloud, waiting for a model to run in the cloud, and getting a response?

The probability is that you want to have that at the edge of the network. You want to have something local, and I don't think he necessarily has a strong point of view on what types of models and industrial applications will be involved, but the bet he's making is that the models are good enough and now the chips are good enough that they can actually realize real-time responses using machine vision and real-time input, and then respond quickly with a local model running, whatever that model is, to drive some output in the industrial setting. There'll be a lot of these sorts of applications.

Whether that's making predictions for biotech research, running robots in warehouses, building new research models, or maybe strapping this PC onto the back of something like a car, a tractor, a lawnmower, a humanoid robot, or any other set of applications. So I think that—

Explain to the audience, Freebird, why having the computer at the edge is beneficial, for those folks who might not know.

If you're taking in a lot of data and then you have to run a model on a lot of data, it's a lot faster to run that model locally. When Tesla runs self-driving, it's not sending the video images from your car to a server 1,000 miles away and then letting the server decide how to drive your car. The car is running its model on what to do with respect to the video imagery in the car.

It's local, because the ability for all that data to get processed in the car means that you don't have to wait for the internet to transmit data back and forth. You don't have lag time. You don't have the 60-millisecond or 100-millisecond response time.

You don't have the problem of losing your phone connection and then not knowing what to do.

Exactly. Or the connection drops, or you're waiting for a server to come online, or a server breaks in the data center. Everything is local.

Yeah.

So if you strap this NVIDIA computer, which is basically plug-and-play—you don't have to have hardware expertise—you could strap it onto the back of a humanoid robot or run research applications locally. So I think that there's going to be some really interesting use cases. Whether it becomes a replacement for the Apple Mac Studio device, whatever, maybe we'll see.

Mac Studio, yeah.

The Mac Studio. But a lot of people have pointed out that the compute on this thing for $3,000 knocks a lot of Macs out of the field.

It's bonkers.

It is pretty bonkers.

I just can't run an operating system in the traditional sense. Sacks, when we look at startups, I remember when you and I started investing, 2 of the driving forces were free storage, free bandwidth, and cloud computing. It drove a lot of the ability to get a product to market very quickly, effectively, et cetera.

What impact will AI have on all these startups that are originating now in 2024 and 2025? Look into your crystal ball. How do you think they'll grow their footprint? How is this going to accelerate the startup scene?

9. AI Triggers A Startup Explosion

I actually think we're going to see a Cambrian explosion of creativity and development of different things, and some of them are going to be stupid ideas and some of them are going to be great. But I think it's going to make our job, especially at the seed stage of investing, harder and harder.

Because?

There are going to be a lot of people who have similar ideas at the same time, who can execute quickly and do things at breakneck speeds that they've never been able to do before.

So picking the winners is going to be hard to figure out.

It's going to be harder and harder. Yeah, and it might be that—I've been thinking about this—do you invest in competitors, which is something I never used to do? Do you take a bet on an index—an entire category that you're interested in? What is the approach at seed and pre-seed?

I think of an idea, and I'm like, "Wow, that's really neat," and then I go and look out there, and there's 30 people working on it. That didn't used to be the case, and I think part of it is that we've really unlocked a tool that allows people to do things that would have been cost-prohibitive or gives them the ability to think, "Gosh, I could be an entrepreneur, and I can try this, and I could do this."

So I'm seeing people experiment and do all sorts of things. As far as the startups, some of the AI stuff is just a feature. It's table stakes at this point. It's like a chat or whatever, and that doesn't really matter. But then you're seeing people reimagine games and reimagine even things down to your kitchen appliance.

I do think it's going to be very, very difficult, and I tend to sit out a lot of hype cycles. So I invested in power and compute, lithography, all of the things that are going to be underneath all of this. I'm not sure how much of it I'm going to participate in until it starts to get to a steady state and you can understand what's next, because the rate of acceleration is just so great that it's sometimes unclear to me, especially when it comes to these consumer applications and consumer-facing things. It's just really hard.

When we were picking, famously, Uber, you had to pick between Sidecar, Lyft, and Uber. There were 3 companies doing it, and it was pretty clear who was the most qualified among those 3.

You now, to your point, if you want to be involved in tax plus AI or legal plus AI, you might be looking at 50 companies, 100. It was traditional in Silicon Valley not to bet on competitors. There were some notable exceptions.

When you run an accelerator like I do, or like Techstars or Y Combinator, you aren't bound by that, because 50% of the companies pivot almost by design. So I think at pre-seed, because people pivot, you just have to tell people, "Listen, we have a lot of pivoting going on. People are going to run into each other. I can't just bet on one thing in a space," right?

Mm-hmm.

If all the founders are going to keep pivoting to each other's businesses, how can the investors even keep track of that? It's like being air-traffic control for 10 airports at once. It's just not feasible.

You wouldn't think it, but there are still a lot of spreadsheet companies out there. You'd think you'd run out of them, but they're still out there. I think this is where AI's really going to make a difference, like RFP proposals for governments.

Something that takes 30 days, is manual, and requires you to submit these horrible documents—you can ingest your entire corpus of all of your previous bids and submit them at breakneck speed now and win more contracts.

So that becomes a national defense company at that point.

Hmm.

So I think we're going to see a lot of really interesting things where a lot of cruft is going to disappear.

Hmm.

That'll be a really interesting wave that I'm looking forward to.

Yeah, in fact, Chamath has made a big bet there with his time, with the software startup that he's creating.

10. Trump Targets Greenland

All right, let's end on the United States of America growing from 50 to 60 or 70 states. Trump has been rattling off some ideas around this. Chamath, what's your take on it? I know we've got to get wrapped up here, so we'll just do a quick lightning round on it.

I thought it was really interesting, and I was just caught off guard at how the media tried to portray it as Trump being Trump.

Whatever, colorful.

But I think what I've realized, even with the California fire thing, is that the guy has this prescient way of seeing things. He may not say it in the way that works for some people, but he's really on top of this stuff.

I just sent Nick a thing. I started to learn a little bit more about why he wants to take over Greenland, and it really comes down to one very basic idea here. Because of climate change and other things, the Arctic ice cap is melting, and the more it melts, the more it opens up a shipping lane in the Northwest Passage for a lot of critical goods.

If you had some sort of strategic agreement with Canada and Greenland, you effectively have this monopoly control over something that could become as important as the Panama Canal. If you look across the world, control of maritime shipping lanes becomes a really critical strategic military and economic asset.

The reason why he's trying to find a way to initiate some sort of discussion between Greenland and Canada is exactly this. I think it's sort of a bargaining gambit, the way that he started, but it's really smart that he's trying to get this done for the United States of America.

Meanwhile, China is militarizing very aggressively, and Russia is militarizing very aggressively. What you don't want to have happen is for those 2 countries to take control of the Northwest Passage as the ice sheet melts. I just thought that was important to keep in the panel.

Having a capable business executive thinking about the future of business, shipping, and logistics is a pretty big win. And I just love the idea, Sacks.

You know what's smart? Let's give Trump credit. What's so smart is that somebody was doing this work, got it in front of him, and he was smart enough to say, "Hold on a second. This is really important."

Yes. Let me tweet it.

And the way that he initiates it gets even more attention, because if he basically tweeted, "Hey, guys, I have this really interesting idea to gain more leverage in the Northern maritime shipping lane," nobody would've paid attention.

Absolutely not.

Nobody would've. Now we're all talking about it, and there's an opportunity for millions of people to understand why and be supportive of it. It's pretty smart.

Cyan, any thoughts on expanding the United States to a couple more territories and states?

Yeah, I think we should have an open invitation.

I love it. I would love to have 60 states in our lifetime. Let's pick 1 in the Caribbean, let's pick 1 in Europe.

I know I'm being a bit facetious here. I understand this is very strategic, this one, but I'm just thinking about the next domino. I would like to get Cuba, maybe Portugal. I don't know if 80% of people in the country would want to join. Join.

It's very strategic. If you look at the Panama Canal, I believe either end is operated and controlled by China. We are at war with China, whether we like to admit it or not, in my opinion, and so this is very strategic.

He has a very strange way of communicating, as you pointed out, but I think it's brilliant. I actually think we should add to that. I've always thought that we should open up and add more states and extend that invitation to Taiwan.

It might be a bit controversial to even say India, but I do think that there's a lot of countries out there and people who really resonate with what it means to be an American and the freedoms that come with the Constitution of this country.

I do think that it would be great for us to expand. I don't know what he's thinking or how he's got behind the scenes, who motivated him to do it, but I really think it's a great idea.

Friedberg, what do you think about opt-in imperialism and this incredible concept of expanding our territories in the 21st century?

Again, I don't know how to read it. I have no inside information. There's clearly some posturing, as we've heard many times.

When Trump makes a declaration like, "I'm going to put on a 100% tariff on every car that's imported," or, "I'm going to charge you $2,000, Mexico, for every time you ship something here," or, "I want to do X, Y, or Z," it's not the literal statement that matters as much as the vector and the magnitude of the vector.

He's clearly trying to begin negotiating for some change. I don't know what the ultimate strategic endpoint is meant to be here, but clearly there's something. I think Chamath might have a good read on this, and it seems to make a lot of sense.

Well, we have a military base there, and we also protect it and occupy it already, which is interesting.

Right.

Right.

We somewhat abandoned all that in Greenland, but there is a lot of that infrastructure still sitting around. You're right.

11. Lost Civilization Theory Emerges

Can I ask you guys a question? I listened to Lex Fridman's interview with Graham Hancock. Have you guys ever heard of this guy?

Yes.

Have you read any of his stuff or watched any of his shows?

No.

I have not.

No.

Okay. He has this belief that there was an ancient civilization on Earth—not a sci-fi, futuristic civilization, but an advanced human civilization. That's where the Great Pyramid of Giza was. There was a smaller pyramid that was built there, and a lot of these other historical places were built and then built on top of later.

A lot of this advanced civilization was wiped out during the last ice age. There was a very rapid freezing event that happened over a period of about 1,200 years, and that's when this great Ice Age-era civilization was wiped out.

What I didn't realize—and so I went down this really crazy rabbit hole in the last week—was how different planet Earth was just 12,000 years ago during the Ice Age. Have you guys spent any time on this?

I just went down a similar rabbit hole with the Grand Canyon.

It's crazy. First of all, how much the planet Earth has changed in such a short period of time blows my mind. The sea level was 400 feet lower than it is today just 12,000 years ago, and there were humans on Earth at the time.

All of this area that we look at, like Malta—the island of Malta—was the southern tip of a continental stretch that went into Italy. It was all part of 1 great landmass, and there's all this area that was actually part of that landmass that now sits under the ocean there. There are ruts in the ground for moving stuff, buildings, and all this other crazy stuff.

We have no idea what's actually under the ice in Greenland or what's under the ice in Antarctica. There are all these parts of Earth where humans very likely had some—

This is so off-topic. We could cut this from the show.

No, I think it's incredible.

No, I think it's fascinating.

Jason and I—

The Atlantis stuff.

It's so crazy that there are all these parts of Earth, especially in the oceans as we start to explore, where there were humans—potentially advanced civilizations—that lived in these areas. Not like sci-fi—

The Atlantis stuff.

—not flying around. You have the Atlantis stuff. It was actually an advanced civilization, and then humans lost a lot of this ability when this period of freezing happened over 1,200 years. A lot of it was preserved in legends and myths that showed up in later archaeology and later museum exhibits.

How do you explain the pyramids?

I think he has a really interesting explanation—

Sacks. Oh, wait, do I want to go to Sacks, I think? We had Gavin explain it last time. Sacks, welcome to Conspiracy Quarter.

Somebody sent me an email, and he said what they did was they flooded the area and then they kind of floated the rocks into place.

I mentioned that last time. They floated the rocks up, yes.

Yeah.

It’s brilliant.

I’ve heard this. Yeah.

But Chamath and I were talking about this too. When you remove all that crust—we were actually talking about it. We just didn’t use Graham’s name.

Oh, yeah. It’s just like your anus.

When you break away all that crust—what did they find in your anus, Friedberg?

Mine was better.

You got it. You landed the joke. It’s great.

I got it.

Oh, we finally got there.

By the way, before you go, do you have an alternative explanation for the pyramids, Sacks?

Yeah, Sacks, what is your alternative?

What about UFOs?

What about UFOs?

The UFO explanation is the only one I usually come back to because, if you look at putting logs underneath and trying to roll them, or you look at flooding an area, all of this just doesn’t make a whole lot of sense.

Hmm.

Hmm. And then the fact that there are other civilizations that also have pyramids that are stunning feats of engineering as well—things like Stonehenge, et cetera. There are just things that defy explanation. I don’t know if you ever tried to make a catapult, but it’s really hard.

It’s really hard.

It’s really hard. And so we just did not have the technology, or at least we can’t find any definitive way that it happened.

Mm-hmm.

And so I do think there is a possibility that there was a more advanced civilization here or we were visited, and I think about that a lot.

I think it’s mutants. I’m going with the X-Men theory. I think there were mutant human beings who had the ability, with superpowers, to build them. That’s it.

It could be that. They had control of matter and alchemy or something like that. Who knows?

Why not?

Why not?