Woke Google Maps, how Wells Fargo is losing money on fintech, and the global AI race | E1967

Jason and Alex kick off the show (0s)

• Welcome to This Week in Startups.
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• The show will go live three days a week on a rotating schedule.
• Google Maps is facing criticism for its "woke" policies.
• Some users are upset that Google Maps is prioritizing social justice issues over providing accurate directions.
• For example, Google Maps has been accused of rerouting drivers away from certain neighborhoods that are considered to be unsafe.
• A fintech company called Built has managed to take Wells Fargo for about $120 million a year.
• Built offers a service that allows businesses to manage their finances more efficiently.
• Wells Fargo has been slow to adapt to the changing financial landscape, and Built has been able to capitalize on this.
• China and Japan are making significant progress in the field of artificial intelligence (AI).
• China is investing heavily in AI research and development, and it is home to some of the world's leading AI companies.
• Japan is also a major player in the AI field, and it is known for its advanced robotics technology.
• There are growing calls for social media regulation, particularly in the wake of the recent mass shootings in the United States.
• Some people believe that social media companies are not doing enough to prevent the spread of harmful content.
• Others argue that social media regulation would stifle free speech.

Woke Google Maps (1m57s)

• Google Maps is considering a feature that allows users to customize their routes based on preferences like scenic views, safety, or energy levels.
• The product team at Google Maps has been conducting studies and talking to users to ensure they create the best possible product.
• Concerns about "spatial inequality" have been raised, as diverting foot traffic from low-income to high-income streets could negatively impact struggling communities.
• Google Maps is not intentionally avoiding certain areas or promoting social justice; they are trying to find a balance that works for everyone.

Squarespace - Use offer code TWIST to save 10% off your first purchase of a website or domain (9m44s)

• Alternative payment methods like digital wallets and buy now, pay later options are gaining popularity and can boost revenue for businesses.
• Waze and Google Maps should consider their impact on communities, as their features can increase traffic and safety concerns.
• The term "woke" has evolved from its original meaning of being vigilant against threats to its current usage as a pejorative term associated with "Karens" and white women fighting for various causes.
• Social media can be challenging, as individuals can face intense scrutiny and mockery for their actions, which can have lasting effects on their reputation, as seen in the case of Tiffany Gomez.

Bilt and Wells Fargo fintech dynamics (16m20s)

• Bilt is a fintech service that allows users to pay rent with a credit card and earn rewards.
• People have been trying to figure out how Bilt works and have finally found the answer.
• Google Maps is adding new features to promote diversity and inclusion.
• Users can now search for "Black-owned businesses" and "women-owned businesses."
• Google is also working on adding more diverse landmarks and historical sites to its maps.
• The global AI race is heating up, with countries competing to develop the most advanced AI technologies.
• The US, China, and the EU are the leading players in the AI race.
• AI is expected to have a major impact on the global economy and society.

CNBC interview with Bilt founder Ankur Jain (17m0s)

• Built, a payment processing platform, offers rewards to renters for paying rent electronically, but the economics did not work out as expected for its partner, Wells Fargo.
• Built users are paying off their balances immediately, not carrying a balance, and not being upsold to new products, resulting in a loss of around $10 million per month for Wells Fargo.
• Amazon Prime's introductory price was significantly lower than its current annual fee, highlighting the potential for unsustainable business models.
• Uber, Lyft, and DoorDash initially operated with negative unit economics, losing money on lower-priced services and driver incentives, exemplifying the unsustainable practices driven by Wall Street's emphasis on growth at all costs.
• Wells Fargo's new credit card rewards program may not be sustainable as it relies on customers leaving large balances on their cards to generate the necessary margin.
• The term "sweep steak" refers to individuals who sign up for various newsletters or promotions solely to win prizes, resulting in inflated email subscription numbers and decreased open rates.
• Startups need to accept the reality of their unit economics and avoid unsustainable business practices to ensure long-term viability.

LinkedIn Ads - Get a $100 LinkedIn ad credit (25m50s)

• LinkedIn ads are effective for B2B marketing, yielding a high return on investment compared to other platforms, as they target senior executives and business professionals.
• Amazon Prime's annual cost has increased to $180, but it remains reliable and convenient, offering fast deliveries and a wide product selection.
• Amazon generates significant revenue from advertising, estimated at $40 billion, and has extracted $400 billion of customer surplus through advertising practices.
• The user interface of Amazon's platform is criticized for being cluttered and difficult to navigate, with excessive advertising and fake or AI-generated product images.
• The speaker expresses frustration with the excessive ads and cluttered interface of Amazon and Google search results.
• Wells Fargo is facing a potential $3 billion fine due to its history of large settlements with the government.
• The global AI race is intensifying, with Chinese investment group Highflyer Capital Management playing a significant role.

AI progress in China and Japan (32m0s)

• Chinese hedge fund Eight Billion AUM developed an advanced AI language model called DeepSeek V2, sparking a price war among tech companies in China.
• The cost of AI technology in China has significantly decreased, leading to price cuts and even free models from competitors like ByteDance and Alibaba.
• The rapid pace of AI development in China challenges the notion that the country lags behind in this field.
• Building language models in different cultures and languages presents unique challenges and opportunities.
• The decreasing cost of AI technology could drive prices down to near zero, similar to the transformation in storage services like Google Photos.
• AI tools have the potential to revolutionize various industries, creating both existential and practical challenges.
• Sakana AI, a Tokyo-based LLM developer, is raising $100 million at a $1 billion valuation and is focused on building Japanese language large language models.
• The creation of language models is becoming cheaper, enabling the development of high-quality LLMs in more languages.
• Countries are recognizing the importance of AI and investing in their own AI capabilities to reduce dependency on American companies.

Mercury - Join 200K startups who use Mercury to operate at their best (39m41s)

• Mercury is a financial technology company that offers integrated financial workflows and banking services to startups, simplifying their finances and optimizing cash flow.
• The COVID-19 pandemic exposed the lack of redundancy in global supply chains, leading to shortages of various products, including essential medications, toilet paper, batteries, and computer chips.
• Governments are increasingly concerned about the influence of foreign technology companies on their elections and culture. For example, India banned TikTok to maintain its sovereignty and prevent excessive influence from foreign apps.
• Despite efforts to reduce the dominance of American companies in certain countries, it can be challenging due to the widespread adoption and integration of their services. For instance, in India, Google Wallet and Flipkart (owned by Walmart) are the two largest users of the Unified Payment Interface (UPI), and the government has faced difficulties in capping their market share due to the lack of viable alternatives.
• AI has the potential to significantly change how countries operate, potentially leading to concerns about national sovereignty.
• The competition for AI advancements could accelerate the development of Artificial General Intelligence (AGI) faster than expected.

Defining AGI and its implications (45m9s)

• The speaker defines AGI as an intelligence that can self-reflect and modify its decision-making process, becoming quasi-sentient and generally intelligent.
• AGI is not just about verticalized intelligence, but artificial super intelligence that surpasses the intelligence of any human in history.
• AGI makes novel discoveries, augmenting human intelligence and potentially revealing profound truths about the universe, extraterrestrial life, and more.
• AGI is moving into a consistent phase, with examples like AI being used in McDonald's to take orders.

McDonald's AI ordering systems and their challenges (49m6s)

• Automated ordering systems in McDonald's are being removed due to frequent mistakes and negative social media attention.
• The removal of entry-level jobs due to automation could create a gap in the job ladder, making it harder for individuals to progress to senior-level positions.
• The younger generation is showing a keen interest in work and earning money, with examples of a 14-year-old and a 12-13-year-old actively trading cryptocurrencies and stocks.
• The concept of "Trad wives" and "Tradesmen" is emerging, where some Millennials are choosing traditional lifestyles and skilled trades over corporate jobs.
• Jason Calacanis proposes a business opportunity for a startup to create a kids' investment app where children can manage their investments and learn about financial responsibility, with features such as automatic monthly contributions and rules to encourage responsible investing.
• The podcast discusses the inclusion of Japanese and Chinese companies in the Twist 500 under LLMs (Large Language Models), with no objections raised.
• The Twist 500 aims to monitor and track notable startups, providing visibility and importance to their market conversations, rather than endorsing them as the best investment opportunities.
• The Twist 500.com domain will be available soon, and the database of the Twist 500 will be included in every issue of the "Ticker Startups" newsletter.

Audience question on EU's AI Act and its impact on startups (1h4m37s)

• The EU's AI regulation involves industry experts, including the current AI champion of Europe.
• California's approach to AI regulation, such as setting a speed limit on model size, is considered inefficient and unnecessary.
• There is a concern that AI is engendering more fear than is reasonable, while climate change is not receiving enough attention.
• Elon Musk emphasizes the importance of considering the potential risks and consequences of climate change.
• The speaker expresses excitement about the possibility of space travel becoming accessible to people with above-average salaries in the future.
• A Pew Research Center study found that over 25% of people dislike both major candidates in the upcoming election.
• The speaker praises Dave Chappelle's comedy show, calling it underrated despite its popularity.
• Listeners are encouraged to share the podcast with one friend to increase viewership.
• The speaker promotes their Substack newsletter, "cautious optimism.news," and invites listeners to subscribe.