To reach the stars, to shape our future. Reaching to feel the new Sam. You're watching TVPN today is Thursday, November 13, 2025. We are live from the TVPN Ultradome, the Temple of technology, the fortress of. Finance, the capital of capital. Ramp time is money. Say both easy use, corporate cards, bill payment counting a whole lot more all in one place. There is a bunch of breaking news. The big news out of OpenAI. Of course, the OpenAI show continues. Sarah Fryer had some comments about ChatGPT's growth potentially slowing and it's unclear it's not in decline, it's maybe deceleration. We'll have to dig into that. It had me thinking about debt and I was thinking about just the fact that the debt has come to tech for the first time really. And this was sort of my take and I'm a little bit. This is an area that I know the least about. And so I was doing some research, learning about a different industry since it's just so abstract to me because I've never worked in private credit or really seen that industry or even just really studied it. You appreciate leverage. You've never been a big. I appreciate. Yeah. And mostly I was just wondering, like, we keep going back and forth on the, on the debt is coming to tech narrative as like, it's very scary. Like when debt comes, only bad things happen. You know, we live through the global financial crisis and there's a lot of jitters when debt is around. It's like, oh, you could get wiped out, you could blow up. The backstop comes in. It just feels like all of a sudden we're talking about things with a much more serious consequence than like, oh yeah, a startup raised some money and it didn't pan out and it was a zero and it wound up being a write down. But it was part of, you know, a portfolio of equities that is averaged out across a whole bunch of different LPs. Like, there's no, there's no even when, even when, you know, like Theranos blew up, it was only equity holders that were lost. It wasn't this entire industry. And so it wasn't, it didn't turn into this like systemic issue. Right? Yeah. But now it feels like with the 1.4 trillion of backlog that OpenAI has kind of opened up across a whole bunch of different deals. There is this worry that maybe the level of indebtedness could be risky. The level of risk in the system, the level of investment in the system could be something that's bigger than just, oh, if you're in this one name, you're taking a big risk. Now it's maybe like, hey, we're all taking a risk. And if we're talking about backstops, at least. And so I was trying to understand there's this old phrase from 2006 coined by Clive Humby, classic coinage. I love a coinage. He said, data is the new oil. And back then in 2006, his point was he was working as a data scientist at Tesco, which is this British grocery store. I don't know if you know this story, but he was working at this British grocery store chain. And his point was, was we have all this data on a customer is in the rewards program. We see that they buy a Thanksgiving turkey before Thanksgiving. We see that they buy this type of paper towels or this type of milk or whatever. We have all this data, but we don't really do anything with it. The data is not valuable. We need to refine it much like oil into gasoline. And once we refine it into gasoline, then we can do things like targeted advertising and we can increase our customer value. And so it was basically just a generic call to action for taking data science seriously. For just don't just have the data there. Understand that the data is valuable if you extract it, if you work on it. But the metaphor, people have been saying data is the new oil for I guess, two decades now. And it never really sat that well with me because unlike oil, data is not perfectly fungible. So one tranche of data is not equivalent to another. Like Reddit is clearly very valuable since it kind of provided the backbone for GPT3. All the analytics data that flows out of some mobile game is basically a. Lot of data is worthless. A lot of data is worthless. All oil has at least some value, essentially. I mean, I guess there are different levels of crude, right? There are different grades. And I was actually trying to play out the metaphor more and I was wondering, can we get to a place where, you know, we can wring intelligence out of raw data like the oil, and the result can be low octane gasoline, kind of like midwit, you know, level like slop, an AI slop, or it can be jet fuel, like a deep research report that's actually pretty great, or some code that's really reliable and really useful. But it all depends on the processing methodology. But the more interesting data is the new oil take that I don't think was considered in 2006 is that maybe the tech industry is going to look like the Oil and gas industry. Soon, like I was looking up what, how much debt is in the oil and gas industry. It's over a trillion dollars of debt. And it's like it's fine, like, yeah, exactly. Clap. It's fine. Like it's not this like huge systemic issue. It was 2 trillion like you know, a decade ago and then it went down and then went up and it's like it's all just a function of like how much oil and gas is going on, where are the new projects, how big are the projects, how much debt goes in. Like just having a lot of mortgages in America is not intrinsically risky. The difference, the difference is that if you identify oil in the ground and you figure out how much it's going to cost you to extract it and how long you think you'll be able like basically estimating like how much, how much oil is actually available in this site. Yeah. Then you can lend against that pretty predictably because you know that the price of oil is going to fluctuate. But in general, as long as it's in a, in some range, it will be like a profitable operation to pull it out of the ground. And I think it's a little bit easier to lend against that than GPUs today when we're, the big debate is around depreciation schedules and will these GPUs. You know, we, we have a sense that a data center that has power and basically a box with a lot of power will be valuable in the future. But if you're, if a lot of the cost of a new Data center is GPUs, it's harder to gauge on what the value of those GPUs will be in, in four years than, than it is. Okay, it, will this oil like production site still be producing oil in five years? I think that's a bit easier to answer and easier to lend against maybe. I mean sometimes there are tracks that only produce oil for four years and you underwrite it against a four year depreciation schedule. And as long as you get the, as long as you match the risk to the reward, the deal pencils out just fine. But, but I understand what you're, what you're getting at. And I think that as we dig into the OpenAI news, I think we'll have more, we can synthesize some of what of the recent, the recent leaks and rumored statements around potentially a plateau and demand tokens on maybe the consumer side. But it is just like a wildly different question, like the fact that you're walking through that math is very different than what the venture capitalists in 2000 were doing. Like Ev Randall who's coming on the show on Friday tomorrow, he always says he goes back to the Google prospectus from when they IPO'd. And Google was like the most pure play, just beautiful software business. So Google from 2001 to 2004 grew from 86 million in revenue to 3.2 billion in revenue. And net income over that period went from 10 million to 400 million. And that includes stock based comp. So they were still making 400 million in profit with the stock based comp. Googlers made a lot of money, they gave away a lot of stock. And so it was, it was not, it didn't look like an oil business. There was not this big capex build out. There was not this big or even this crazy R and D phase. There was just not, there wasn't that much capital that went into Google before it became this monster cash flow machine. It was infinite money glitch. It was sort of an infinite money glitch. It was this beautiful algorithm that was just discovered and it was so elegant and it just produced this monopoly insane like growth rate for so long. And then of course they've been challenged and they expanded and there's million things and then eventually capex did come into the picture as they grew their cloud, the cloud infrastructure, gcp, all this other stuff. But, but for a long time like tech just meant take a bet on a company and it's either a zero or a trillion dollars or something like that. And so it's a lot different. And I wanted to dig into like the actual structure of one of these deals because I don't, I think that tech people, I was, I was almost going to call this like why is no one talking about Blue Owl? Because people obviously on Wall street are definitely talking about Blue Al. It's a, it's a public company that stocks I think down like 30. Poster child. But, but it's the data center of finance. Private credit. Yes, private credit, exactly. And so I wanted to understand like how does Blue Al actually interact with one of these data center deals? Because that's important to understand like where the risk winds up living. So I'll break one of these down but first I'll tell you about Restream 1 livestream at 30 plus destinations, multi stream and reach your audience wherever they are. So for Hyperion, you remember the Hyperion release, Zuck went on threads and announced that he was gonna be building a 5 gigawatt data center, it was gonna be as big as Manhattan. Looks like somewhat of a Manhattan Project. Somewhat of a Manhattan Project, exactly. So the crazy, crazy thing about that deal. So he spins up the, he puts out the announcement post on threads, says, hey, we're going to build this 5 gigawatt data center campus. It's going to be online in a few years, it's going to be as big as Manhattan. And he shares some of like, where it's going to be, how many racks are there going to be square footage, stuff like that. But he's basically just announcing that, like, hey, the project's financed, we're ready to go on this. Like you would expect that when that. It's a $27 billion deal, you would expect that. Okay, Meta went down, they spent $27 billion. It's worth it. They're going to. No, they got paid 3 billion. They got paid 3 billion. And the reason is because Blue Owl financed it with external debt. And they are basically paying Meta up front for the right to have them as a, as a tenant, as a leaser for a very long time. So they get this, like, we have Meta as a client. Meta is always going to pay their bills. They're not, they're like, no matter what happens with the AI build out, they're going to be good for it because they have this cash machine. So they are like the best possible tenant. Not like some fly by night, oh yeah, I'm a startup, maybe I'll be around in a few years. It's like, it's Meta. They're going to pay their bills. And so you have this massive data center project that's going to be paid for even if it's not producing any valuable tokens. Zuck's still going to, he's not just going to default and be like, yeah, take the company. No way. He's going to pay. And so in exchange for that, they had 3 billion upfront. And so there's just each one of these deals. I think the more you dig into them, I want to have more of these people on. Mohamed El Arian at Pimco was formerly at Pimco. I know he can explain this a little bit more. I want to have more people on, on the show to help us get up to speed on this because this feels deeply important to the current AI buildout boom. The tech story, it feels like an entirely new piece of the puzzle to understand where this technology is going, and I don't feel equipped to understand it at all. Barrons did have a Great article about Blue Owl and a very funny interaction between Blue Owl and Jamie Dimon. And they're going at it and I think it's interesting to read through. So let's read through a little of this to give you a little bit more flavor on what's going on at Blue Owl. Because if you're just in tech, if you're just in venture, you might not know that much about them. But first, let me tell you about Privy Wallet infrastructure for every bank. Privy makes it easy to build on crypto rail, securely spin up white label wallets, sign transactions, integrate on chain infrastructure all through one simple API. So in Barron's they I had this. This article's from October 24th. I had it on the table. We never got to it. We're getting to it now. It's the title of the article is Private Asset Star. Blue Owl has been flying high. Is it too close to the this feels like headline Jordy would write very skeptical about about what's going on in the AI buildout in the AI boom. But let's, let's dig it. And I like the phrase private assets star. Yeah, start calling our friends private asset stars. For sure. For sure. So the article says suddenly Blue Al Capital is everywhere. This past Tuesday, the upstart alternative investment firm with an aptitude for private credit announced a financing deal for Meta Platform's $27 billion AI data center in Louis is Hyperion that I was mentioning earlier before the week before at the PAC Alternative Asset Summit in Los Angeles. Blue Owl's co CEOs co CEO Mark Lipschitz called JP Morgan Chase's CEO Jamie Dimon Cockroach warning about risk and private credit. An odd kind of fear mongering. So what happened there was we talked about that, that blow up in the private credit world and I have a little bit of background on this. So where did he say this? So I need to actually pull up what happened with the, with the private with the cockroach statement because it's very funny. Is that about first brands? It's first brands. Let me see. First brands. First brands. Okay. So basically private credit has been growing a ton. We've talked about this a few times. Aries is massive now Blue Owl is really big and the whole and there's basically been this little bit of a fight emerging between where the debt is coming from. Do you do private credit or do you go with the traditional bank route? And so Jamie Dimon, at least I'm pretty sure he's going head to head against Blue Owl in a bunch of these deals. And so there's this question of like, you know, are they chirping at each other intentionally? And so Jamie Dimon was cautioning investors about potential risks in the credit market by invoking a proverb, when you see one cockroach, there are probably more. And so he was referring to recent loan defaults, such as the bankruptcy of auto parts maker First Brands and subprime lender Tricolor holdings as warning signs of broader credit issues. So Jamie noted, or Dimon noted, that JP Morgan took losses on some bad loans and implied that trouble in one corner of the credit market could mean undiscovered problems elsewhere, implicitly casting doubt on the booming private credit sector. And so Mark Lipschitz fires back and he says, I guess he's saying that there might be a lot more cockroaches at J.P. morgan. And so he's actually saying like, oh yeah, maybe you should go check out their books and see if they have other bad stuff. Because so First Brands Collapsed was an isolated case of alleged fraud actually in the syndicated loan market. And it was not in the direct lending arena where Blue Owl operates. So Blue Al has had no exposure to First Brands. And yet Mark Lipschitz was still firing back at JP Morgan for kind of casting doubt on the direct lending arena where Blue Owl plays. So there's these cockroaches, there's these cockroach statements and they kind of go back and forth on this. But the history of Blue Owl is also interesting. It's this like merger between a few different, a few different companies here and it's part of this broader boom in alternatives. Blue Owl was the primary lender for CoreWeave. CoreWeave. And they've also done Stargate, they've done a ton of stuff, but interestingly, their data center business is I think like less than a third of their overall business. They have a lot of other stuff going on here. So. So George Walker, who's the CEO of the old line money management firm Neuberger Berman, he's a cousin of President Bush, he says it's extraordinary what they've done. It was just a startup. And now their $26.6 billion market cap compares to a number of large century old financial institutions. There were some Blue Owl's backstory entails some rich behind the scenes machinations. But more significantly, it reflects the stunning trajectory of private markets which have tripled to 26 trillion dol in assets over the past decade. The company's also. Yes, and so, I mean, I do think it's important to keep like the scales in mind here. Like the 1.4 trillion seems so big in the venture context and we think about Sam Altman as a venture backed founder, but he's now playing in a. Market that's playing a hyperscaler game. Yeah, he's playing a hyperscaler game. And so when I think about it's like 1.4 trillion. That's the same size as the oil and gas market. Meta's Manhattan like Manhattan Project scale Data center, the 5 gigawatt data center that you talked about them doing this deal with blue owl on Meta's also just did a $30 billion bond offering which has 4 billion of 4.2% senior notes due in 2030 and then all the way up to 4 and a half billion of 5.7 senior notes due in 2065. And there was an order book of around $125 billion for the $30 billion issuance. So there's a massive amount of demand. So this is not at least that we know of. What OpenAI has not been raising this style of debt for the business and it's unclear if there would be like a ton of demand for OpenAI's like on balance sheet debt. Totally. Given that it's unclear if they're going to be able to spend what they've already. Yeah, but underwriting a Data center with OpenAI as a client is very different than underwriting OpenAI directly. So there's some really funny quotes in this article. Blue Owl is the pretty girl at the dance right now, says Wall street trader David Williams. We're talking many billions in private credit. Ah yes, private credit. Though Blue Owl has three lines of business. Private credit spec, specifically direct lending in private equity deals, is the firm's calling card and growth engine. And the straw that's stirring Wall Street's punch bowl lately. They also have this like GP business. If you want to buy a GP stake in Alternative Asset Manager, you can do that through Blue Owl. But what everyone's interested in is this private credit specifically for AI assets, at least from our perspective. Perspective. I'm sure there's other people that find the other pieces of their business much more interesting. But its core direct lending business has 145 billion in AUM out of 284 billion total. So that's about half the fund. And that was conceived the firm started in 2016 as Owl Rock at the Putnam Restaurant in Greenwich, Connecticut. Of course, comfort food its best by principals. Doug Ostroover, formerly the O of GSO Capital Partners, now Blackstone Credit, Craig Packer, a former Goldman Sachs partner and Lipschitz, a former KKR partner. The name came from the wisdom of an owl and the stability of a rock, says Lipschitz. And the website was available. That always helps. So instead of relying on Inventure, we all think of the GPLP private markets fund structure, right? Jordi Alroc changed this. They don't do the typical GPLP split. They use what's called business development companies, BDCs. So those companies issue stock and lend money to businesses, usually those with junk credit ratings. So something like a one off data center that really only has like one client. And it's not like Apple, it's not Microsoft, it's not an actually like, you know, been in business for 30 years, not the government. And so it's going to have a junk rating, it's going to be higher, a higher interest debt instrument and other. And this has actually been a trend. Other major alt firms are also turning to BDCs which support higher yields. And so BDCs send some 90% of the interest collected on those loans, loans to shareholders through dividends. So they've basically created the same structure as a real estate investment trust or something close to it. And so this has allowed them to scale. So two of Blue Owl's BDCs are publicly traded, others are private. They have Blue Al Capital Corp. Which yields 11.4% and Blue Owl Technology Finance which yields 9.9%. Both are down about 14% this year, the former from January 1st. And so Goldman Sachs recently called the fears overblown about the risk of falling rates and weakening credit. And they cited Blue Al as undervalued, noting that it has a stock price to fee related earnings multiple of 21.7, which is 5% below its two year low. So the stock has been beaten up, but it still has like a buy rating from Wall street firms. Blue Owl has generated a stable, highly predictable stream of earnings, says Ostroover, the other co CEO. It makes no sense that we're down more than our peers, he says. If anything, we should be down less. I love it. I love a defensive. Wall street may be maybe particularly wary of direct lending as shares of both Blue Al and Aries, which specialize in that business, have fallen hard. It's also true that both stocks had previously outpaced their peers. The second leg of the Blue Al stool was created years earlier when a Lehman Brothers executive, Michael Reese, started a fund at Neuberger Berman that bought stakes in asset managers like De Shaw, this is what I mentioned earlier about buying buying GB stakes. Reese named his endeavor Dial after his children Dylan and Alexia. He just took his two kids names, pushed them together, raised its own capital from Koch Industries and invested in the likes of Silver Lake and Vista Equity Partners. So he was a vehicle to allow you to buy GP stakes in Silver Lake and Vista Equity, which are not publicly traded, I believe. In 2020, Blue Owl merged with Al Roth and so the resulting company was named Blue Owl. A bank working on the deal had called it Project Blue. So Blue was added to and Rock was dropped because it was Owl Rock before. And so the hatching of Blue Owl was problematic to some companies in which Dial had invested, particularly sixth Street Partners and Galoob Capital, both of which sued claiming the new company created a competitor with sensitive information about their operations because of course they own GP stake in the companies. And so in 2021, Blue Owl bought Oak street real estate capitalist Chicago based firm specialized in sale leasebacks and triple net lease deals as its third business. This wing of Blue L has AUM of 71 billion and is home to the Meta Infrastructure deal. So it's like a remarkably balanced stool. I'm sort of shocked. I was expecting it to be like, oh, we hear about Blue L in the Meta context and that's their main business or it's new thing and it's only 5% of their business. But in fact they have, they have a pretty, pretty diversified offering across a few different products. And so this wing now has 71 billion and is home to the Meta Infrastructure deal and others such as Stargate data centers in Texas and New Mexico. Next, Blue Al is working on AI deals with N Scale and Valor Equity to finance purchases from Nvidia, whose chips go for $30,000 and up, according to people familiar with the matter. Blue Al built its direct direct lending business by borrowing from the Silicon Valley playbook of scale first, monetize later, or by underpricing established private credit firms to gain deal flow and then raising fees later. Most of the firm's direct lending business is done as part of private equity buyouts. So Thoma, Bravo, Blackstone, Warwick, Pincus, these companies come in and then Blue Owl does the debt side of that. These investments generally entail floating junk bonds, a business pioneered by Drexel burnham in the 1980s, but it was typically done with banks. Now it's the done with these private credit firms. The private private credit market has grown from 2 trillion in 2020 to 3 trillion at the start of 2025. So again I'm like, that's, that's growth. But that's not the craziest growth I've ever seen. Like, when I go back to global financial crisis, you know, you hear about these, like 10x run ups in these derivative markets. Like, I don't know, it just feels like, it feels like we're still in like the early stages of actually ramping this piece of the capital markets and marshaling that to the really crazy stuff. It feels like the crazy stuff's coming in two years. I don't know. Yeah, and that aligns with Doug from Semianalysis Point. He was like, debt. We're still early in the debt cycle. We're early, but at the same time, market has jitters. I was working on our 2026 merch this morning and I had about an hour call and so I missed the fact that Nvidia is down 4%, Core Weave's down 8, 8%, and it's a little bit shaky out there. We're certainly not in white suits today. No, no. Well, let's go over to the timeline. Let's go over to some of that other news that we wanted to touch on today. But first, let me tell you about Cognition, the makers of Devon, the AI software engineer. Crush your backlog with your personal AI engineering team. So Alex Heath has a scoop here in Sources. During a recent private call, OpenAI's investors asked about external signs that ChatGPT's growth is slowing. CFO Sarah Fryer. The external signs were, I think, like app store data. There was some data out of Europe. Oh, yes, yes, yes, that's right, that's right. And it was hard to read into the European data because Europe, Europeans, they don't work ever. No, I mean, it was coming off of summer. Right. And you know, ChatGPT is popular with. Students, but European summer hasn't ended yet. European summer ends like late December. No, I have to push back on that because when the French television network came. That's true. They were clearly done. That was about a month ago. They were clearly back from summer holidays and they wanted to learn about the AI talent wars. Yes, that's true, that's true. No, we're obviously joking there. Anyway, so there's, there's been, there's been early warning signs. Well, yeah, walk me through some others. So I can walk through Alex's coverage. As on Monday, open. OpenAI, CFO Sarah Fryer held a priority. She was really hoping to just not be in the news cycle this week. But when you're the CFO of One of the most important companies in the world. It comes with the job. What bag holder is leaking this? Yeah, that's private call. You're an investor and you're leaking bad news to sources. What are you doing? Yeah, what are you doing? Did you get out or something? Like, have you somehow facilitated some short position? Jumps off the call? This is very founder friendly. Whoever's doing this. Whoever's doing this is not very founder friendly. Okay. Anyway. Anyway. Sarah Fryer held a private quarterly earnings call with the company's biggest investors. Yeah. As usual, the numbers she shared were mostly up into the right. But behind the strong top line figures, a quieter question hung over the call. Was ChatGPT's momentum starting to slow? During the Q and A portion of the call, sources say Fryer was asked to reconcile ChatGPT's meteoric growth and weekly users from 250 in September 2024 to over 800 million now with external signs that the app's growth has slowed in recent months. Close. Followers of Opening Eyes Business have been whispering about these signals from research firms since late summer. But this was an opportunity for company backers to hear directly from leadership on the matter. After telling the investors to take third party estimates with a grain of salt, Fryer acknowledged a chink in ChatGPT's armor. She said time spent had decline slightly in response to, quote, content restrictions the company rolled out in early August. She then referred to the loosening of those restrictions that CEO Sam Altman has said will be implemented for adults in December. So this is them. Sam came out and said, we're going to allow erotica on the platform. And Sarah says, and OpenAI expects the decline in time spent to reverse. And so, so this reminded me of a conversation we had about exactly a month ago where I said, I don't think them announcing that they're getting into erotica is a sign of strength. I don't think that's something that you do just because you want to. Right. In my view, it felt like clearly there's user demand for it, but at the same time, that felt like something that you that they would do in order to stimulate growth while they get a bunch of other monetization online. Right. So like commerce, ads, et cetera. Yeah, no, that makes sense. Yeah. I mean, the original, like, founding team at OpenAI was incredibly idealistic. Right. Like, incredibly. Like you're going to work on a nonprofit on like super intelligence, like AGI, like you truly are, are working on, like, what you see as one of the most important problems. What I agree with is one of the most important problems. Then of course, like, you know, eventually the, eventually the company evolves and you and you bring in business leaders. But at the same time, like, like, I do believe that they say I want to cure cancer. I believe that. I believe that too. And so the reason I reacted strongly to it was that, yes, there had been messaging, you know, around the same time of I don't want to be in a world where we have to decide between curing cancer and free education for the world. Yes. And so then at that same time, deciding we're going to do erotica. It was very weird timing. It was very weird timing that those two statements, like, came out one after another. Yeah. I'm actually surprised why they're waiting until December to roll out the adult content. So in this scoop, do we have any, do we have any spec specific data on what exactly is indicated in terms of ChatGPT's growth slowing? Can we actually try and define that a little bit more? Is that users. Because there were already at almost a billion users. Is it time on site? Is it monetization? I mean, deceleration. We were talking about this. OpenAI has decelerated revenue before because I think they tripled and then they went to a doubling or they were quadrupling and then they went to a tripling. And so they actually decelerated in 2024 and then they re accelerated in 2025. And so I was kind of saying like, well, there's a good chance that you could see deceleration in the future. It's happened before. To be accelerating forever is basically impossible. But it would be interesting to track exactly how ChatGPT's growth is slowing. There certainly feels like there's just a level of saturation. Do you have the stats? Yeah. So similar web put out some information on month over month change in total visits to leading gen AI tools. ChatGPT is at the bottom of a list that includes Gemini, Deepseek, Perplexity, Grok, Claude, copilot and Meta AI. The key difference here is that like ChatGPT is so much bigger than these other platforms that they could still be adding more users on a per user basis than these other tools, even if their growth is slower. Yeah, yeah, that makes sense. Tyler, what do you. I mean, they do expect their growth to slow down. So like from this is epoch AI, it was like OpenAI revenue estimates. Yeah. So 2025 is 13 billion and then they expect 2.3x 2026, 2x in 2027 and 1.6x. Yeah. So, I mean, it's not like they're just saying like it's. It's going to go from 2x to 3x to 4. Yeah, exactly. So I wonder, I wonder how much of this is just framing something that was sort of already priced in as like a bad thing. Like I feel like people were expecting deceleration and so if she's, if she says, like if she's on the call and she says as expected, we're really big, we're going to be decelerating the level of new users that we're adding and then. I don't think she should say that. Yeah, maybe that would be bad framing. I don't know, it just doesn't seem that crazy. Please don't say it. I don't know, it doesn't seem that. It doesn't seem like that bad of a thing to say. Meta is not accelerating top line users. They have like 3 billion users. No one's expecting them to accelerate. Top line users, maybe like randomly, one quarter. They accelerate, but not continually. And so I don't know, it just feels like an odd thing. Did you get a chance to read the Ed Zittrin article? This thing? I did, but I didn't. I felt it. Ed is such a massive OpenAI hater. Sure. That I think it was hard to. And the sources were pretty unclear. It was hard to read. Too much. Okay. Okay, well, let me tell you about figma.com. think bigger, build faster. Figma helps design and development teams built great products together. You can get started for free. Should we head over to some timeline? What else people are saying? Cairo Smith says it's going to be very funny when LLMs plateau around 120 IQ and what we've created is just a digital guy, not a God. This doesn't make any sense. If we have infinite digital guys, that's like. Literally a guy is just like a worker. If we have infinite workers. That's insanely bullish. Yes, it'd still be bullish, but it's been prompt. You know, people are promising. He didn't say bearish. He said it's gonna. He didn't say it's gonna collapse the economy when we just get a digital guy. He said it's gonna be funny. And I agree. I guess that's true. It's funny. But this is still like a very bullish take. I think people, I think you might read this as like being. He's kind of bearish. Yes, yes, yes. Yeah, no, I know, I know. I think you're right. If you get a digital guy, that's pretty powerful cuz guys can do a lot of stuff. Stuff. It's valuable. I love guys. Yeah. You need a guy for everything. You do need a guy for everything. And you will. And that's been one of the great luxuries. Right. The middle class has apps. Yes. The wealthy have guys. Yes, yes, yes. And the apps get better with. The apps get better with AI agency. AI agents. Right. Because you have an app that acts a little bit more like a guide than an app. Real quick, scoot in the X chat, almost bought a counterfeit TVPN hat. No way. Watch out. There is a counterfeit TVPN store. These are not by us. They've made it look like it's by us. I'm not going to name the link, but we have not sold any merch. We will make the merch available as soon as possible. I was working on it this morning before the show, so it's coming. But do not buy any of the counterfeit merch. My big concern with that site is I don't even know if they ship it. Yeah, that is a big question. And they also made like 100 products. They made so many products. And I did email them and I. And to be clear. And our lawyers emailed them and we've submitted a bunch of takedowns. Yeah. When I emailed them, I was like, hey, I assume you're just a fan. I was being too nice as being golden retriever mode. But I did say, I was like, hey, like I, you know, I appreciate this idea. This is, this is very cool that you're enjoying the show. But like, we just don't want people to get confused. We have our own plans for the store. They're like, okay, I'll make 200 products. They just didn't. They just didn't respond at all. And so then we sent a takedown notice and we will be fighting that tooth and nail. So stay safe out there. But please don't buy it because we have nothing to do with it. Tyler, did you get a chance to read Fiji Simo's latest blog post, Moving beyond one size fits all. I hope you didn't read. I think studied sat your ass. We talked about this for a tiny bit yesterday. Yes, yes. This was just the 5.1 release. Yeah. Nothing I would say super substantive in it. She kind of is talking about how I think with 5.1 they were going. Like, we made our digital guide faster, better, stronger. Is that what it is? The EQ of the model lot rather than iq. Yeah. That's why you see a lot less benchmarks. I think it's just hard to actually benchmark that kind of stuff. Yeah. But the actual style of the model, talking about kind of safety ish stuff where there's like, you know, I mean. It is crazy following this company so closely because in here there's a line that says with more than 800 million people using ChatGPT, we're well past the point of one size fits all. And 800 million sounds amazing. Except I feel like I heard the 800 million number like two months ago and I feel like they have been accelerating so fast you expect them to be 50, 900. Exactly. And so the fact that they're repeating the 800 number is like, they're like. Sorry, we can't add a third of the United States every month. I know, I know, I know. It's very, very high stakes. It's very, it's very impressive. They built, to be clear, but I just, I am really keyed that, like 800, 800, because I was, I was excited they were going to hit a billion. It was going to be a big moment. And yet it feels like maybe that's a next year goal. But Near Cyan has been going back and forth on this. Near said ChatGPT is officially in its Fiji Simo phase. If you're wondering why the upgrade doesn't come with benchmarks, have fun. Run says you are confidently wrong about the internal dynamics of this. It could be better summarized as an infra cleanup. Up and near says the source for my top tweet is Fiji's blog post from today which discusses the release and its goals. I don't really know what else to say. I don't know, is there hunger for benchmarks anymore? I might actually take the other side of this here and say that I like that they're getting away from benchmarks. I wish they didn't do a five point. I don't want any more confusion. What is 5.1 versus 5? Just make it better and don't do a release and certainly don't tell people because what if Easy for you to. Say because you're not in love with a specific version. John, I'm in love with five. I'm in love with five. Rune, bring back five. I don't like 5.1. I need five specifically. Not four. Zero, not 5.1. I need five. Five, please. I will say when. Just put the five in the bag. Run. Yeah. Come on. Bring back five. Bring back five. We need. Need to cyberbully Rune until we bring back five. Even the most minor tweak to the model is unacceptable. You can still use 5 Pro. I know. So that's. That's got to account for something. Only five. Thinking. Okay, but, but I was saying when GPT4. Like, GPT4. Like, not four or anything, when that was the, the best model, they would do updates. Yeah. They wouldn't like, say, oh, this is a new model. Yeah. And people could definitely tell. Oh, sure. Like, okay, they released a model, it's worse. And then everyone on Twitter would hate it. But then I think. So you think putting a version number actually helps fight back against that? Because people are like, oh, I get it why it's worse. You changed it. Instead of there being a surprise under. The hood, I think it's more. It's just easier for people to tell it that it was actually a change when they're noticing something that they've been depending on. It's a little different now. I just don't understand why you're surfacing it in the UI of a. Of like, if I open my ChatGPT app at the top now, it says ChatGPT 5.1. Like, this is a consumer iPhone app. It is. Today's Pulse is here talking about Blue Owl, Stargate Investment and ChatGPT 5.1. And I just have to wonder if, like, the 5.1 is like, unnecessary. Like, if I open up Instagram, it does not tell me what version of the REELS algorithm I'm on. They're going to change it every. Every day. Like, just change the algorithm all the time. Just make it better. And yeah, if you make it bad, I'm going to churn. So don't do that. Make it better every day forever and just keep shipping ship every single day. I'm sure that internally there are version numbers of Google Search. Right. Because they push to like a main GitHub branch or something or whatever they use for their monorepo. But there is version tracking for the reels out there algorithm. They just don't surface that to the user. So I don't know why they're surfacing 5.1 to users after there was like so much pushback over 4.055. All this other stuff, it seems like, I don't know, it seems like a mess. You know what doesn't seem like a mess? Vanta Automate Compliance. Manage risk and Accelerate trust with AI. Vanta helps you get compliant fast. And we don't stop there. Our AI on automation powers everything from evidence collection and continuous monitoring to security reviews and vendor risk. There was one more note from Alex Heath's article on OpenAI that actually I think is worth sharing. He says after Meta's last earnings call. Sources say, and this is confusing because the name of sources is I don't. Want to hear what Alex Heath has to say specifically give me some like people who are close to the matter. I don't, I don't really. I don't want to know what sources says. I want to know what sources people close to the matter. Sources says that sources say. Okay, sources says that sources say CEO Mark Zuckerberg joined an internal employee Q and A and shared a warning about the AI bubble. First, he shared a breakdown of how different players from startups to big tech names like Meta should think about timing their bets. He described three camps in the industry. Optimists who see superintelligence emerging within two to three years, moderates who expect breakthroughs by the end of the decade, and pessimists who think it'll take well into the2030s. Each outlook, he said, dictates how aggressively a company is invest. Then he expound expounded on a version of the answer he gave me recently in our last interview. He noted that while unprofitable startups like OpenAI and Anthropic Risk bankruptcy, if they misjudge the timing of their investment, Meta has the advantage of strong cash flow. He also made the point that while big tech has historically been relatively debt debt free compared to large companies in other sectors, the AI infrastructure race is leading Meta and its peers to start using leverage in a more normal way rather than relative to their size. Like he told me in September, Zuckerberg acknowledged to employees that met his market cap could suffer if his timing is wrong and the bubble bursts. But the message was clear. We'll have the balance sheet to survive and emerge stronger than most on the other side. So anyways, Super Dario was quoting that and said the obvious end game in the next two to three years is that Microsoft acquires OpenAI, Google acquires Anthropic and Tesla acquires XAI. Only the large caps survive. That's a nuclear hot take that. Crazy, crazy. How would that even? I don't know. Can Microsoft get the rest of open AI? I mean, I guess they probably have. Depends on the price size. It's a $4 trillion company versus a 500 billion. Yeah, I don't know. It doesn't seem like impossible. Let me tell you about graphite.dev Code review for the Age of AI Graphite helps teams on GitHub ship higher quality software faster. Get started for I want to run through some more of these posts, Yujin Jin says. In contrast, OpenAI employees stayed for two plus years, sold $6.6 billion of equity last month. Many hit the $20 million cap. Morale and vibes are high, but so is the turnover rate. New OpenAI hires are often shocked by how many slack accounts get deactivated each day. This is a screenshot of an interaction between Jack Morris and Liang Chen Luo at xai. Jack says there are dozens or perhaps a Couple Hundred X OpenAI, XAI, Google, DeepMind researchers, founding companies in the current climate and this was talking about the simple answer. The liquidity of anthropic options is the worst among those frontier levels. This is talking about how a lot of people have been leaving various labs, less people have been leaving anthropic. And so Liang Chen is saying the simple answer. Yeah. And so Andrej Karpath he says bullseye. It's interesting how large of a fraction of people don't see the dominant first order term that drives behavior of people in companies. You can construct a powerful world model just by understanding one, just by one understanding the system and two, assuming there is only this single term like liquidity, how much cash you have. What would be interesting is if you could is if companies started offering liquidity in the form of annuities. So imagine you have an employee who's like a rock star. They're going to sell $20 million of stock and they're going to basically be post economic. If you could instead say we're going to be paying you out like you're selling now, but you get a billion dollars a year or something. There needs to be some way to sort of cap. Is there some way cap the actual amount? I guess 20 million was the cap, but I don't know. There's some way to deal with this. Like if you don't get employee liquidity, they'll leave for something else. They'll just go somewhere else that pays them a higher salary. If you give them too much liquidity, they'll leave and start new companies. Very, very tricky to manage the team. But that is the nature of these these companies. Chad buyers. That is his real name. He is a chad in the literal sense and figurative sense. He says one of my strongest beliefs is that it's going to take 20 plus years to get AI penetrated into the real economy. I filled out a piece of paper at the doctor's office last week. I filled out a piece of paper at the doctor's office last week too. It was crazy. And I was wondering like when will we see a fast takeoff in Docusign? Fun. I finally realized why Docusign has so many employees. Because you need to go to every doctor's office in person apparently for decades to get them to use online form filling technology like General SaaS really does not has not permeated as much of the economy as people think. A lot of people still on spreadsheets for all sorts of stuff. A lot of people still on paper and pencil. There is a. You know we joke about being pro ramp anti paper receipts. Of course there's a company that makes paper receipts that's worth $20 billion. $20 billion. There are fax machine companies. The fax machine industry is still over a billion dollars. Still a billion dollar industry. Crazy. I would think it was actually more. Yeah maybe that's, maybe that's too small. It's sort of hard to like calculate because a lot of these things have been like rolled up into to other companies. And big facts. Big facts wants you is one of them. And so I don't even know if Canon breaks out their fax business anymore because they sell so many cameras and other equipment. But yeah, it's interesting. NIR says imo, in my opinion the entire AI field switch from explore to exploit. Two years earlier everyone convinced themselves no this isn't the case. Look at our exploration and it's like watching someone go on a 50 foot walk and find a cool tree when the entire continent is still covered in fog of war. Now that the terrain seems known, it should be harder to convince yourself. I suppose this makes sense given a lot of people hint at being good as gone as soon as they have enough money. But no, not me. I've been gone for ages already. Ready? That's a very funny post. I suppose. Weren't we talking about this yesterday? This idea of like, of like where will the next innovation come from? Where will the next breakthrough come from? Will it come from any of the. Any of the like will it come from Xai? Will it come from DeepMind? Yeah, like how much do you need the college campus? How much do you need that environment? Yeah. Will it come from a university? A university? The universities seem to have not like it's very odd that the university system did not provide produce the transformer paper. Feels like the perfect thing to come out of a university setting. Yeah, I mean it's really tough right now. You can stay in a university system and be a student and be taking on debt. Or you can go work at a lab and make have a good shot at least if you did this a few years ago, have a good shot of making $20 million in a few years. And it's hard to give up that kind of opportunity. Yeah. This Wall Street Journal article has given more context on the AI boom. Says the AI boom is looking more and more fragile. AI stocks have swung downward as doubt rises about sustainability and payoff. Perfect isn't good enough and any sign of weakness is a disaster. This is what's happening. It's like you double revenue and your stock trades down. It's very, very odd. But everything core weave who again is the only neo cloud in the platinum tier semi analysis is down 45%. That is remarkable. Last month it's like they have built a by all accounts fantastic product. Product. Fantastic product. I mean like, I don't know, maybe Samuel got it wrong, but I don't think so. But it feels like they built something that as infrastructure delivers at the level of the hyperscalers just like a fantastic product. And yet the market like sort of ran away with that narrative and now is pulling back a little bit. So recent history suggests that the gloom won't last. But the shakeup serves as a strong reminder that the early years of AI pose a challenge for investors accustomed to measuring return on a 12 month time horizon. Generative AI services require massive data centers and state of the art chips and server racks that don't come together quickly. The companies at the heart of the of AI are now talking about years, plural, of all major investments still ahead. So everything has kind of sold off a little bit. Oracle is down the most from its three month high. Nvidia is down a little bit. Google is neck and neck. They're doing great. And oddly, Apple didn't even make the chart because they're not, they're so not indexed. AI or right now. The latest episode of fragility started last week when shares of some of the sector's leading lights lost ground after a broad based recovery on Monday on news of a possible end to the government shutdown, AI stocks fell again Tuesday. Nvidia is down 4% today, lost 7% last week, slipped another 3% on Tuesday while leaving it well shy of its $5 trillion market cap. Cap. Yeah. Looking at the trailing 12 months, Apple is up 21% and Microsoft, which owns a third of OpenAI is a huge AI beneficiary has invested a ton in it is only up 18%. Wow. So Apple, which has been going through. This is the, this is the secret. Just don't invest in AI. Do nothing. Just don't do it. Just skip it entirely. No, just do nothing. Tim Cook's like, wait, why would I spend 100 billion billion on capex? I can sign up, to be clear. He's like, I can sign up for chat for like 20 bucks. So hard. She's like, yeah, you know, we have this, we have Safari, we have this web browser and you can go to use AI from there. Just do that on your phone. That would have been the correct thing instead of the getting over their skis a little bit on the branding side, fortunately not on the financial side. So they've done very well. There is of course, real reasons to worry about the sustainability of the boom. Chief among them is that there's far more AI computing infrastructure spending than there is AI revenue. A gulf widening by the day. OpenAI says is planning to spend $1.4 trillion in the next eight years, but is only pulling in around 20 billion of annual revenue today. And it lacks a clear business model to reach the hundreds of billions it needs within the next few years to keep the spending growth going. OpenAI is projecting losses will swell to 74 billion in 2028. So skittish has the mood become that CEO Sam Altman felt the need last week to defend the company on X, saying the spending was understandably causing concern. Wow. He says he understands your concerns, Jordy. He pointed to his plans to boost revenue with new consumer devices, robotics efforts, an AI cloud computing service, none of which currently exist. And this is why when we were the Monday after that interview and we were talking about it, saying that wasn't a strong answer because all those things seem like businesses that will lose a lot of money even if they're successful. Yeah. Until they can reach some huge scale. Look at matters efforts and hardware. Look at early days of any hyperscaler. Look at any robotics company. Right. These are not cash engines. They're cash incineration engines that could one. Day if they want, if they want to get more like cache cash generation, stop incinerating so much cash. OpenAI should, you know, I know they're doing a lot, but they should expand into like just rolling up H Vacs. H VAC businesses just buy a bunch. Of H Vac, adding agents into the workflows. Don't even agents. We don't even need to do that. Just buy a good durable business and roll it up. Plumbing, electrical, roofing, storage units. Storage. There's a lot of good money in storage. Storage units. If they could get into some storage units. Just buying a storage facility and then OpenAI. Cloud storage. Storage storage units that look like clouds. Yeah, cloud storage. Lawn mowing businesses. They could get into a bunch of lawn gardening businesses. There's a whole bunch of opportunities. Landscaping. Yeah. I mean, just buying multifamily homes. Just buying some multifamily homes. Single family homes. Single family homes. Getting the rent payments. They put the money in, they buy the house and then they get the rent payment and that's how they make the money. And I think that could be. It's a proven business model. Like we know it works. It works for a lot of people. A lot of people. They start with one single family home. They grow it, they keep. Box of Orange is an OpenAI Property Management LLC. So they have the property management company. They own the properties with enough and so they can actually play both sides. Play both games. They could get into drop shipping. Oh, think about it. They could set up a TVPN merch store. They could set up merch stores. Counterfeit merch store, for sure. That's what they keep talking about. Agentic Commerce in the ChatGPT app. Imagine you go there and you're just like, I need some T shirts. And it just instantly sends you some T shirts. They're getting into drop. Drop shipping. They could also launch a course. You launch a course. How to build an AI startup. How to build an AI startup. 2,000 bucks. Buckle up, buddy. Get ready to pay two grand. Sam Altman's already been driving around in hypercars. You know, he has the garage. He has the garage for it. To be a course bro. To be a course bro. That would be great. Actually, he has a much better collection. He really does. I would pay for his course. Honestly, I would 100% pay for Altman. Course in a McLaren in a. In a P1. And he's telling you, I will teach you to be rich. I will teach you to build an AI. I mean, I'm buying deals, how to. How to do deals from Sam Altman. I would 100% pay two grand for that course. I'm not kidding at all. Like 100%. It's worth it. That would be better than any college course ever. Be incredible. Well, I'm glad we're having a good time. Let me tell you about Julius the AI data analyst. Connect your data, ask questions in plain English and get insights in seconds. No coding required. Julius. Julius has an out of home campaign. Right now and it's really good. It says, ever since I was young, I wanted to transform data into actionable business insights. It's the best. It's the best. Fantastic. Great work. Meridu says if you're down today, you're a certified beta bubble boy. You literally bit up SanDisk. WTF? Alternatively, you can call yourself a bad beta bitch. People are having a lot of fun, Dario. SanDisk is only down 15% today, so. SanDisk, by the way. Yeah. The White House last night tweeted, we are so back in all caps. What was that? What did that mean? What? What did they mean by that? In what way were we back? I have no idea. Idea. But I have news I need to share with you that I can't share on the stream. But let me tell you about Fall, a generative media platform for developers. The world's best generative image, video and audio models all in one place. Develop and fine tune models with serverless GPUs and on demand clusters. And the chat says the OpenAI McLaren Museum. Open up a museum? The McLaren Museum. Just tickets. Just like adding to our revenue. Like we're gonna charge 25 bucks. You can bring your kids. I would visit, I would buy the course. I would go to the museum. Yes. Well, our. Our first guest of the show is in the Restream waiting room. Let's bring him into the TVP at Ultradome. How you doing, Spencer? Good to see you.

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