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Jul 27, 2024 ยท 2024 #26. Read the transcript grouped by speaker, inspect word-level timecodes, and optionally turn subtitles on for direct video playback
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Speaker 2
That was a week No time to be meek The goal is to seek The next big thing That was a week That was a week Stand back Think big Take deep
Speaker 1
Hello, everybody. It is Saturday, July 27th. We haven't done a That Was The Week show for a couple of weeks. Keith and I have both been traveling. And it's an interesting day today. A certain Donald Trump is speaking at a tech event, Bitcoin 2024. where the call is to make Bitcoin great again. It seems as if... I don't know whether Bitcoin is jumping on the Trump bandwagon or Trump is jumping on the Bitcoin bandwagon, but it's an interesting phenomenon. We'll talk about Harris later. Keith, what do you make of this? Do you think there's anything real here? I mean, usually tech is very much on the fringes of national politics, but it seems as if Trump is... throwing his chips in, so to speak, with Bitcoin?
Speaker 3
Well, Trump's a consummate opportunist, so you can't trust anything. He'll do anything to get elected. And, you know, Bitcoin ownership is, I think it's like 30% of Americans own some crypto now. It's a lot anyway. So I think he's playing to the crowd. I doubt he has a clue about, you know, the real conversation about Bitcoin, which is the replacement reserve currency for the dollar and gold for that matter. So I think he's mainly being opportunist. And I don't think he's the only one, by the way. Tech is, you're right, tech is suddenly important. There's been so many fundraisers here in the Palo Alto area for different people, including Trump. that it's clear that tech is leaning in. And a lot of the well-known figures in tech like Reid Hoffman and Ron Conway strongly in favor of Kamala Harris and Elon Musk and David Sachs strongly in favor of Trump. It seems as if tech is becoming an audience that they want to cultivate on both sides.
Speaker 3
I think we may have lost Andrew. Andrew, are you still there? Are we still streaming? I think we are, but I'm on my own.
Speaker 1
Here we are. Can you hear me?
Speaker 3
I can, yeah. Did you disappear for a second there?
Speaker 1
I think it was Trump. Keith, coming back to, you called Trump an opportunist. I mean, I don't think anyone would disagree with that, probably including himself. But he's chosen to go to Nashville today. which is a reasonably big deal. He must get hundreds of invitations. So there's someone on his team who believes that Bitcoin is a big deal. Is there an ideological component? Do you think? I know JD Vance is another Bitcoin person. Are they somehow shoehorning this embrace of Bitcoin into their hostility to the state and to the Federal Reserve?
Speaker 3
You know, I don't claim to have insight there. It is clearly the case that if you're running for president or vice president and you embrace Bitcoin, that is clearly an anti-state decision because the entire thesis of Bitcoin is a decentralized system.
Speaker 3
backed by the trust of the people that has no remit to support national policies of any government. And so it's an extremely libertarian decision, let's say, to be pro-Bitcoin. It could easily also be a pro-government decision. If you think about the history of currencies and what it is that supports currencies, it always used to be gold. But the world went off the gold standard after the Second World War and has never returned to it. And so currency today isn't backed by anything, actually. It's just a promise by the government. And it would be quite easy for a government to decide that Bitcoin was legitimate if they wanted to. Some governments have, by the way. in the world, like El Salvador, I think, Venezuela for a while as well.
Speaker 1
I mean, the jury is out at best in terms of what happened in El Salvador. There are tech investors, the Winklevosses, of course, they're inevitably going to be backing Trump because of his Bitcoin thing, but also more serious ones like Marc Andreessen and Ben Horowitz. They have warmed up to Trump, it's quite controversial, and Elon Musk, of course, but Andreessen and Horowitz clearly said that the reason why they're backing Trump is for business reasons, particularly in terms of crypto. Do you think that's true? Do they genuinely believe that crypto is important enough for them to vote or support Donald Trump, give money to his campaign?
Speaker 3
Look, I mean, both intellectually and financially, they are massively committed to crypto. They've raised billions of dollars for funds, invested, they're the most aggressive investor in crypto infrastructure and protocols, and they are thwarted at every turn by the SEC. It's your friend, Lina Khan, that eternal graduate student, Keith. Well, it's her friends, really, at the SEC. It's not really the FTC, but... Well, I think of Khan now as an adjective or a noun, right? Yeah, I agree. In that sense, yes, you're right. So what Andreessen and Horowitz are saying is, The government needs to get out of the way or at least make clear the regulations so that they can actually build a distributed financial system for the world, which is what their goal is. Not just financial, actually, many other things as well.
Speaker 1
Which is very un-Trumpian, certainly very global rather than nationalized.
Speaker 3
It's global, but in that sense, it's anti-Chinese as much as it's anti-American. It's really an attempt to create a harmonized but distributed financial infrastructure for every movement of assets, whether cash or otherwise, around the world. And that would be massively liberating, obviously. I also think things like universal basic income rely on such an infrastructure to exist.
Speaker 1
Well, and Altman, of course, one of his companies, is merging those two worlds. Elon Musk, very rarely, for better or worse, out of the news. After Trump, the failed assassination, clearly came out and backed Trump. We haven't talked since the assassination, Keith. It's not clear now whether or not Musk is really writing a $45 million a month check for Trump, but he clearly is intrigued by Trump. Is his thinking on the crypto front, or is it broader or different, or is it just musky and harder to actually figure out?
Speaker 3
Yeah, I don't think, I don't believe he has a thesis on crypto other than he has a lot of fun with Dogecoin, which is a copy of Bitcoin, but with a different name. Um, so I think he's mostly not serious in that space. It's more a playground.
Speaker 1
I mean, talking about Musk and seriousness, um, that's some people might suggest he's never serious except about himself. And in that sense, he's very similar to Donald Trump.
Speaker 3
He's pretty serious about Tesla. I mean, Tesla missed its numbers this week and lost 18% of its share price in a day. And I listened to the earnings call and he's super serious when it comes to Tesla. He talked a lot about the robot. And he also talked a lot about power and storage being distributed. And he talked a lot about why Tesla will be worth many times more five years from now than the current share price.
Speaker 1
I become bullish now on Tesla, Keith, now that I know that you're leasing a Tesla, you've sold all your expensive cars. So if Keith Teer is on board, Tesla is the future. Certainly the support of some VCs for Trump has outraged many in the tech community. The Verge ran a piece on the moral bankruptcy of Andreessen and Horowitz. Are you seeing it on the streets of Palo Alto, Keith? Are your VC friends horrified by the fact that people like Andreessen and Horowitz and Musk and David Sachs, of course, and others are coming out clearly, unambiguously, unashamedly in favor of Trump?
Speaker 3
Look, yes, you do see it. This is interesting because at the very heart of the Silicon Valley ethos, there's a contradiction. On the one hand, you have to believe in innovation and capitalism because innovation that's what venture capital is. It's taking money from pension funds and endowments, putting it into very, very high risk startups, which is admirable, in my view, to commit some part of society's resources to huge bets, many of which fail, but some of which don't. That's fantastic. And you have to believe in capitalism and innovation being, if you like, twinned. On the other hand, Most people in Silicon Valley are liberal. You know, the Democrats win elections here all the time at both the local level and the state level. So there's liberalism in terms of the desire for human good. And innovation, of course, is also tied to human good. But Therefore, you hate government interference getting in the way of all of that. So that's a contradiction. You have extremely conservative anti-government opinions sitting alongside extremely liberal social opinions. And what has happened in this election is an absolute split where an individual like Marc Andreessen has to choose a side. Typically, he'd be able to be on both sides. But yes, he's felt compelled to choose a side. And I think that's true on both sides. That's the same with Reid Hoffman on the other side. And that's mainly driven by the polarization in the society more than it is by anything else.
Speaker 1
To me, it's pretty healthy. Andreessen's come out clearly for Trump. And we'll talk about Hoffman in a minute. Hoffman is a major investor and a major supporter of politics. of Kamala Harris just reflects America. Silicon Valley has always been fetishized one way or the other, oversimplified. Why shouldn't Silicon Valley be split? The rest of America's split.
Speaker 3
Exactly right, exactly right. But it takes a harsh form. I mean, for those of you who don't follow it, the conversation on X this week between Paul Graham and David Sachs that you referred to in that TechCrunch article, was viciously personal. Yeah,
Speaker 1
you gave me that link, Paul Graham, of course, your pin-up, and David Sachs were involved in a huge public spat. But this wasn't, was this political? I mean, do you think it's driven by politics? Graham went after Sachs, of course, who's big Trump person. Graham, I think, is a supporter of Harris. Do you think that politics underpins a lot of this stuff? And so if you really peel away the reasons why Sachs and Graham and others are fighting each other publicly now, you can understand it in political terms?
Speaker 3
You know, mostly no, although I do think there's a political dimension to it. Graham is a pro-Democrat and Sachs is a pro-Republican. and actually spoke at the GOP convention a couple of weeks ago. But I think the key driver actually is your attitude to startups and investors. Paul Graham is strongly pro-founder, and David Sachs is strongly pro-investor. And why Combinator is described by Sachs as a mafia, because In support of founders, it often becomes rhetorically aggressive to investors. It takes the founder side every time. Privately, by the way, behind the scenes. But it's a bully when it does that. It's got a loud voice and it threatens. And Sachs has been on the receiving end of that. In his defense, he would claim that everything he did at Zenefis was to support the investors.
Speaker 1
I mean, really, and I think you probably agree with me. I mean, who cares? I don't understand why. Maybe in Tech Crunch it got in the headlines, but ultimately it's a fight between Two rather self-interested, greedy VCs pursuing their own interests. What about, you mentioned Y Combinator, the most famous graduate of Y Combinator, of course, is Sam Altman. He had an interesting piece this week in the Washington Post on who will control the future of AI. We'll maybe come to that in a minute. Where's Altman in the election? You haven't seen his name associated with either party. I'm guessing that he wouldn't be a big fan of Donald Trump.
Speaker 3
I think you're right. He did weigh in on the Paul Graham issue today, strongly supporting Paul Graham against accusations of anti-Semitism. And, of course, Altman is Jewish.
Speaker 1
I mean, that was the last refuge of scoundrels to accuse other people of anti-Semitism. Yeah.
Speaker 3
such an abstract context well you know graham is strongly pro-palestinian and um there's a lot of misunderstanding around that issue so let's not get into believe that one we have enough problems without that but but i mean personally i'm i think now is the time to be strongly pro-jewish given the context. So that is whatever it is. That's my point of view. I will say Altman, going back to your question, Altman, the future of AI, I don't yet see his journey towards that vision that he outlines in that Washington Post.
Speaker 1
Well, the Washington Post seems to sort of Maybe I'm putting words into Altman's mouth, but sees the next Marshall Plan being an AI plan tying together the free nations of the world against the Russia's and China's and Iran's of the world. And in that context, he believes in government in contrast to the Bitcoin crowd or certainly the Web3 crowd who have fetishized distributed networks.
Speaker 3
He believes in government. as long as it protects OpenAI's proprietary system.
Speaker 1
It's probably true of many of us, Keith, including you and I and most of your friends in Silicon Valley.
Speaker 3
Well, that's the opportunistic, self-interested part. Mark Zuckerberg this week announced... next open source version of llama which apparently is as good if not better than open ai and is free and committed to open source as the most the most likely protector of this non-authoritarian version and and and zuckerberg even went so far as to say it's better to give china that level of technology than deny it because then at least it's all open source code and transparent. And, you know, so I'm more with Zuckerberg in believing that this is not about nation state competition. Altman always frames it as nation state competition and seeks US government support against foreign governments. I think that is totally self-serving and not genuine. I think Zuckerberg for equally self-serving reasons, is taking the opposite point of view. They're both self-serving. But Zuckerberg's vision is a little bit closer to the world I would like to see, which is that this stuff is available to everyone largely for free.
Speaker 1
And what's interesting is we're in the process of the Zuckerbergs, the Altmans, the Andresens, the Peter Thiels and the Saxons, everyone's scrambling to... figure out where they stand on all these things and how it connects with politics. I do, of course, want to come back to the biggest story of all, the Harris story. But before we get there, Keith, you had an interesting link to, I'd never heard of this fellow, Peter Nixie.
Speaker 3
I was an investor in one of his companies.
Speaker 1
Yeah, the founder of intentional.io. He has created, you and I have talked in the past about AI and video, I've always, as so often, been rather skeptical, believing I've played around with some of the tools. They haven't seemed particularly impressive. But you said that Nixie's actually done some pretty impressive stuff just using AI tools.
Speaker 3
Yeah, so Nixie is pretty much a regular guy. He isn't any more creative than you or me, and possibly even less. And what he did is he's made a song with lyrics and music with an accompanying music video using, is it Sona or Sora? I forgot the name now. Yes, Sora. Sora. He used Sora for the lyrics and music and he used Runway for the video, which we talked about last week. And he's produced roughly a three-minute song with a video. And it's Suno, not Sora. Oh, there you go, Suno. He's produced this pretty decent music video in two hours from start to finish.
Speaker 1
Which actually seemed quite long, yeah. And it cost him $50. I'm not sure where he put his money. So you're saying that this does suggest that AI video is for real?
Speaker 3
ai video and matching content is for real and i mean i i think his video is one of the first i've seen that um you know you can see flaws in it for sure but it's pretty close to a professional quality production of a full end-to-end thing that only took a couple of hours yeah i think it's
Speaker 1
job whose business whose living is made in the production of video but that's another subject given that this is a rather um spontaneous that was the week keith you haven't put together a startup uh of the week so i'm gonna do it and i'm gonna give it to a certain kamala harris i'm not sure if i'm pronouncing her name right my wife is always telling me off But I've given it to her. She has a pinned tweet and she is running for president of the US. She does seem in some ways, Harris, like a startup. It's not entirely clear where she's come from and what she wants to be, but she's huge news.
Speaker 3
Yeah, you know, I mean, firstly, thank goodness Biden did what he did and she's now the candidate. She, historically, I've always found it difficult to like her, mainly because of really stupid personal traits like how she speaks and stuff.
Speaker 1
Do you think you have a problem with smart women, Keith?
Speaker 3
They, yeah, well, do I? I'm scared of them. Lena Kahn. I think I could be scared.
Speaker 1
Tamara Harris.
Speaker 3
Yeah, I could be intimidated by them. That could be it. But, you know, I'll be voting for her for sure, and I'm very, very glad she's running. She seems super self-confident compared to four years ago, as in she doesn't seem to be trying too hard to get her message across. She seems to live very comfortably in her own skin. And the message, which is, for example, that women get to choose their reproductive decisions, I 100% align with.
Speaker 3
So great. I think it's fantastic.
Speaker 1
You know startups, Keith, as well as anyone. You've done many of them. I've done some with you. Do you think as her team scrambles around to invent or reinvent her that they can learn something from startups? Should we be thinking of her as a startup project?
Speaker 3
We can, yeah. I just want to point out that Mariam Nagavi has commented that Keith does not have a problem with strong women. Thank you. Thank you, Marianne.
Speaker 1
He's like strong women. Thank you, Marianne. We'll, we'll note that for future episodes.
Speaker 3
So, um, um, you know, I think she's gonna, she's got from now to November, uh, to, uh, close the A round in using startup parlance. I do think she has friends and family. She's at that stage. She's at the friends and family stage. She has a lot of friends and a lot of family. That's for sure. And, and, um, You know, clearly there is not going to be a contested Democratic convention. She's going to be anointed. And it's going to be interesting as she picks as a running mate. I think that's going to be a big decision.
Speaker 1
Well, runway, we always talk, we entrepreneurs, about runway and speed and all the rest of it. In politics, it doesn't always work like that. But for this particular campaign, she doesn't have a lot of runway. She's going to have to get her act together very, very fast. She's got to choose a vice president in the next week or two, and then she's got to get out on the road. She's got to debate Trump. She's only got about, what, three or four months to do all this. So does a startup entrepreneur like yourself, what advice would you give her?
Speaker 3
The best advice you can give is to be herself and to believe in the vision.
Speaker 1
She might not have it. My sense is she doesn't really have herself.
Speaker 3
No, I think she does. I mean, I'm no expert, but even what I've seen, I think her job as a prosecutor in San Francisco and the way she talks about it In the American system, a prosecutor represents the people against perceived criminals. And she's done that her whole life. So she certainly has that knocking down the bad guy, supporting the people kind of core. And you can't really be a prosecutor because you don't get paid that well unless you believe in the law as an instrument of the people.
Speaker 1
Just back to the state, Zuckerberg, of course, famously said, move fast and break things. Is that another idea that she should be pursuing? I mean, the critique of her, which I think is true, is that She was always nervous about breaking anything. So she ended up doing nothing when she was running originally for office. Does she have to break things? Does she have to alienate some people, piss some people off?
Speaker 3
I think she's like all of us. When she did something for the first time, it was a bit intimidating. And her insecurity came out through her tone. I think that's kind of gone. I'm not hearing that when I've heard her in the last few days. So I think she's grown into her own capabilities. She's living comfortably in her own skin. And that's coming across, at least to me. And I was inclined not to like her. So if I'm saying that, I think other people will think the same. And so the fact that it's a close race is what astounds me. I mean, how could it really be a close race? I'm displaying my biases there. But I don't think... I can't believe that more than 30% of American voters truly believe they want Trump in the White House. But it seems as if it's closer to 50%.
Speaker 1
Let's come back to Silicon Valley. You mentioned Reid Hoffman, very wealthy, powerful and... liberal, I guess, with a relatively moderately liberal Silicon Valley fellow, another of the PayPal mafia who's very strongly for her. She's connected with, she's been connected with uh sean parker lauren jobs mark benioff ron conway how much support is there in silicon valley do you think for her and do you think in terms of moving fast and break things the thing that she might have to break is her connection with the left of the the democratic party that tends to be not just hostile to silicon valley and big tech but also to capitalism itself
Speaker 3
Yeah, I don't perceive her as being of the left, to be honest.
Speaker 1
Well, but that's one of the things that the Trump people are going to try and argue. She has connections, some of her language, particularly on DEI, is the language of the left.
Speaker 3
Yeah, it's not my dominant impression. I mean, the word left is such a contested word these days, so maybe that's right in some definitions of what left is. But, you know, I would like to see her be for free trade, which is historically right-wing. I would like to see her be for immigration, but obviously controlled immigration, but still immigration because of the age problem in the United States of the aging population. I'd like to see her be for less regulation over crypto, or at least clear regulation?
Speaker 1
Yeah, there's a piece in the FT that she is seeking, quote unquote, a reset with crypto. She's not the most popular person within the crypto community. And I think she declined an invitation to speak in Nashville today. It seems as if Trump, for better or worse, has sewn up that community.
Speaker 3
I doubt it because I think that isn't really a community. If you go to one of these Bitcoin conferences, you're going to meet, you know, charlatan second-hand car dealer types. Whilst at the same time meeting... You just sold your car, Keith.
Speaker 1
Be careful. Two cars you sold.
Speaker 3
Yeah. Whilst at the same time meeting people like Mike Larrington who are thoughtful and articulate. So it's a broad spectrum.
Speaker 1
Where's Arrington on this? I'm guessing he's probably more on the Trump than the Harris camp.
Speaker 3
I don't actually know. I don't know. I mean, I'm sure he's relieved that Biden isn't running.
Speaker 3
I'm sure he has some misgivings about Trump, knowing him a little bit. But I think if forced to choose, he's pro-capitalist. So he's going to want to see that...
Speaker 3
Kamala Harris's as well.
Speaker 1
My sense is you talked about this potential contradiction between liberal freedoms and the market, but I think the vast majority of people in Silicon Valley are going to go for Harris. I mean, maybe not the Andreessen and the Horowitz's for one reason or another, or the Elon Musk's who's a community unto himself, but the vast majority of entrepreneurs and investors, I think, would probably be more sympathetic to Harris, wouldn't they?
Speaker 3
I think they'll be sympathetic based on where they think the money outcome for themselves is the best.
Speaker 1
They have wives. I mean, what about the other social issues? J.D. Vance has been unambiguous about punishing people who don't have children and banning transsexual procedures. A lot of talk about taking... the abortion thing even further. These people have, I mean, most, most VCs are still men. They have wives, they have children.
Speaker 3
Yeah. I think, I, I think the dominant Silicon Valley mode is liberal always has been, or probably always will be.
Speaker 1
And global. Many immigrants here, many Indians, many people from East Asia.
Speaker 3
Liberal, global, but also everybody's trying to get rich. That's America.
Speaker 1
Could, I mean, in the best case scenario, could a Harris administration be a renaissance, the beginning of something really interesting and innovative?
Speaker 3
You know, I'd love to believe that, but I must say that's where I most strongly agree with Andreessen. I think the democratic agenda vis-a-vis, in quotes, big tech, is inherently flawed from the point of view of how you get progress, how you achieve the liberal dream of individual freedom. You can't really disconnect it from innovation. And if you regulate innovation too aggressively, you strangle it. And so I tend to come out on the, I think of myself as a left-wing libertarian, although, like I said, the word left doesn't mean much anymore, so maybe that's a bad label. But I'm for human progress, and I believe that innovation and the wealth it produces fuels that. I do at the end of the day think that leads you to some big questions about the ownership of wealth, which I'm not scared of. So I don't want a small number of wealthy billionaires owning everything due to the fact that they own the companies that create innovation. So that's a big question.
Speaker 1
You don't believe, I mean, CNN ran a piece with the headline that Harris wants to be America's first Silicon Valley president. Is that just marketing nonsense?
Speaker 3
Well, a bit, because there is this narrative that Silicon Valley wants big tech regulated so that startups can properly compete with the incumbents. And, you know, so the words... It really matters what the meaning is inside the words when she says that. Is she going to be Google's president or is she going to be SignalRank's president? You know, not the same thing.
Speaker 1
You can't be both. You can't be SignalRank and Google.
Speaker 3
I actually think you can be, but I don't think the Democrats think you can be.
Speaker 1
Well, finally, Keith, the X of the week is from a certain... Kamala Harris. I don't know if I pronounced her name. I always get it wrong. I'm always getting told off for pronouncing it wrong. Let's win this. Harris for president. Is this winnable, Keith? You seem still a little ambivalent.
Speaker 3
I'm ambivalent because structurally, I think America is harming what is normally here called the middle class. I think of it more as the working class. In England, we call it the working class. In America, it's almost like there is no such thing as a working class because everyone's middle class. But the poorer Americans who are earning $50,000 a year or less are not well served at a time when America, relatively speaking, is in decline economically vis-a-vis Asia in particular. And that hurt is personal and has led to Trump's populism being supported by poor people who, you know, it really isn't in their interest to support him, but they're so upset with life that they want to lash out and they support Trump. So if Kamala doesn't win, And by the way, Kamala is what the Republicans call her as an insult. It's Kamala.
Speaker 1
Kamala.
Speaker 3
Yeah. So I didn't mean to insult him because they try to make it sound foreign. And of course, in Republican circles, foreign is always bad. In my circles, foreign is always good. The more different you are to me, the better. The more I like you.
Speaker 1
And finally, Keith, finally, finally, we'll come back to this subject, of course, although it is supposed to be a tech show. That was the week's summary. Is this a huge election or is every year it's always this every election? People say this is the most important election in history. Do you believe that or is it just more of the same? And if Trump comes to power, they'll just be more Trump nonsense for four years. And if Harris comes to power, they'll be. Harris model and nothing much will change one way or the other.
Speaker 3
Yeah, I Think elections are always super important if you stand back and look at them in context of the last Let's say five elections if you want to understand the meaning of an election is much much better to stand back and look at them in context this this election and an arguably every election since Reagan is a story of America coming to terms with its own limits and the reaction to that. And therefore the confidence of America is being squeezed out and it is an unconfident reactive America that is electing people. But that reason the incumbent almost always loses recently because change is so strongly desired due to anxiety with the way things are. And so I think every election is progressively more anxious and more polarized.
Speaker 1
Well, we will return to this. I like how you put it, Keith. This election is about America coming to terms with its own limits.
Speaker 2
That was a week No time to be meek The goal is to seek The next big thing