TWiST News: Skydio's Drones, High-Skill immigration, and M&A Unleashed | E2040

Jason and Alex kick off the show (0s)

• The show is discussing the day after the US election, with the hosts welcoming viewers and acknowledging the election results, regardless of their personal opinions (0s).
• The hosts will be talking to the CEO of Skydio, Jason, about the company's importance in the drone space and its recent issues with sanctions in China (6s).
• The show will also cover the impact of the election on immigration, M&A, and the startup world, including winners and losers (20s).
• The hosts will discuss the upcoming Perplexity Round Up and put it into context by exploring different ways search works today (31s).
• The show is sponsored by Oracle, Notion, and Assembly AI, with the hosts promoting their products and services (40s).
• The hosts, Jason Calacanis and Alex Wilhelm, introduce themselves and discuss their feelings about the election results, with Alex expressing concerns about the president-elect's policies and Jason hoping for the best and emphasizing the importance of supporting the winner (1m23s).
• Jason expresses his concerns about socialism and authoritarianism, but hopes that the president-elect will surround himself with people like Elon Musk and make productive decisions, such as lowering spending and addressing censorship (2m20s).
• Jason also expresses his disturbance about the deportation policies proposed by the president-elect, which will be discussed further in the show (3m42s).

Skydio’s Adam Bry joins the show (3m55s)

• Adam Bry is the CEO and co-founder of Skydio, a drone company that initially gained fame for building consumer drones capable of following users and taking videos (3m56s).
• Skydio has pivoted towards the enterprise sector, working with governments in a defense context and with corporations (4m8s).
• The company has raised more than half a billion dollars (4m13s).
• Adam Bry has joined the show to discuss Skydio's developments and progress (4m14s).

Overview of Skydio's autonomous drones and public safety applications (4m22s)

• Skydio makes autonomous drones that serve as flying sensor platforms for critical industries, including public safety, defense, and critical infrastructure operators, enabling them to get a real-time digital picture of things they care about (4m23s).
• The drones are easy to fly, can be deployed in seconds, and can be used to inspect cell towers, power plants, or respond to 911 calls (4m42s).
• Skydio's products are accelerating the use of drones in public safety, where drones live in network-connected charging base stations, or "docks," which can be placed on top of fire stations or police stations, allowing for rapid response to emergencies (4m57s).
• The use of drones in public safety is transformative, keeping communities safer, increasing transparency and accountability in policing, and providing better information to first responders (5m19s).
• Skydio was founded in 2014, and after a decade of steady build, the company has reached a point where autonomy technology is good enough to deploy drones at scale, transforming the way physical industries work (5m33s).
• Skydio's solution includes a housing for drones, a landing pad with inductive charging that manages the drone, allowing for full automation and autonomous flying (6m30s).
• The dock is the key to full automation, and it enables drones to fly themselves on a schedule, automated missions, and interact with users through a phone or web browser (7m12s).
• The dock makes the drone experience purely software-defined, removing physical friction and making it powerful for various uses (7m32s).
• Skydio's drones are automated devices that can perform useful work without human intervention, similar to cloud services, but with the potential for leasing by the minute in the future (7m41s).
• The concept of leasing drones by the minute could lead to a shared infrastructure for cities, where a network of drones can respond to various incidents, such as 911 calls, fires, and infrastructure inspections (8m8s).
• The number of drones needed to cover a city effectively depends on the volume of incidents or events, rather than the area to be covered, with one drone able to respond to approximately 2,000 calls for service per year (9m1s).
• For a city with a population of around one million people, a couple hundred drones would be needed to cover it completely, although useful work can be done with a smaller number of drones (9m20s).

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• AI is transforming various industries, including self-driving cars, medical research, and business tools, but it requires significant computing power, leading to high costs if not managed properly (9m32s).
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• OCI costs 50% less for compute and 80% less for Network compared to other cloud options, resulting in substantial savings for businesses (10m17s).
• Thousands of businesses, including MGM Resorts, Specialized Bikes, and Fireworks AI, have already upgraded to OCI (10m29s).
• Oracle is offering new US customers with a minimum financial commitment to cut their current cloud bill in half if they switch to OCI, but this offer ends on December 31st, 2024 (10m37s).
• Interested companies can check if they qualify for this special offer at oracle.com/twist (10m50s).

Skydio as the largest US drone producer and Chinese sanctions impact (11m7s)

• The largest producer of enterprise-grade flying sensor platforms, or drones, is Skydio, with the majority of people buying drones from the Chinese-based company DJI, which is the dominant player in the space (11m8s).
• Drones consist of various components, including motors, propellers, GPS, and a computer, similar to the components found in a cell phone, but combined with a quadcopter (11m18s).
• Historically, radio control toys and drones were made in China, giving the country a substantial lead in hardware production, with DJI being the leading company in the first wave of manually flown drones (12m38s).
• Over the past decade, drones have evolved from consumer toys to critical tools for various industries, making it increasingly clear that depending on China for these products poses a risk to national security, public safety, and the battlefield (13m0s).
• The use of drones in Ukraine has highlighted the dual-use technology, with civilian-class quadcopters being used in high volumes on the battlefield, aligning with Chinese foreign policy and national interests (13m30s).
• Skydio has always manufactured its drones in the US, starting from its first product, not due to geopolitical concerns, but to build the best product possible, as drone manufacturing is more similar to building a fighter jet or spacecraft than people realize (14m8s).
• Skydio's approach to manufacturing is driven by the extreme engineering required for drones, involving aerodynamics, thermals, vibration, and mass constraints (14m37s).
• Skydio, a US-based drone company, has been manufacturing its products in the US since its early days, which has become a strategic advantage, especially when serving military customers who care about national security (14m48s).
• The company's decision to manufacture in the US was made in 2016, despite the common practice of outsourcing to China, and has proven to be critical from a national security perspective (15m14s).
• The Chinese Ministry of Foreign Affairs has sanctioned three companies, including Skydio, Edge Autonomy, Operations Huntington, Engles Industries, and Adam, citing the reason for Skydio's sanction as selling drones to Taiwan (15m28s).
• Skydio does all its planar assembly manufacturing in the US but still has a network of global suppliers, with most drone components coming from China; however, the company has been working to get its supply chain out of China over the last two to three years (15m50s).
• The sanction has caused a disruption to Skydio's battery supply, which was still coming from China, but the company has been accelerating its work to find parallel suppliers and expects to bridge the gap with inventory on hand by next spring (16m10s).
• The stated reason for the sanctions was selling drones to Taiwan, but Skydio's first customer in Taiwan is the Taiwan Fire Department, leaving room for speculation about the ulterior motivations behind the sanctions (16m43s).
• The sanctions may be a retaliatory effort by the Chinese government due to increased pressure on PGI, the leading Chinese company, in the US, as well as Skydio's success in competing with DJI and taking market share away from them (17m14s).

Risks of Chinese-made drones and Skydio's cybersecurity measures (17m36s)

• The use of Chinese-made drones poses a risk to public safety, similar to the concerns surrounding Huawei networking equipment, due to the potential for backdoors that could allow the Chinese government to access data (17m43s).
• Autonomous devices like drones and self-driving cars can be used for malicious purposes if hacked, and the lack of regulations on hobbyist-built drones makes them a particular concern (18m29s).
• The risk of drones being used for malicious purposes increases as they become more integrated into critical infrastructure, such as power plants and cities, and are connected to the cloud (19m39s).
• The industry is still in its early stages, but as drones become more widespread, it's essential to consider the potential risks and take steps to mitigate them (19m16s).
• A wholesale ban on importing Chinese-made drones may not be necessary, but it's crucial to consider the potential risks and take steps to ensure public safety (19m5s).
• Skydio approaches cybersecurity by prioritizing reliability and security, implementing measures such as secure boot, secure signing of software, and authentication to the cloud (20m52s).
• Skydio controls the supply chain and manufacturing process to minimize the risk of hacking, and implements various security measures at every layer of the stack, including encryption (21m8s).

Drones in defense and combat applications (21m28s)

• Drones have been used in Ukraine for various purposes, including surveillance and combat missions, raising questions about Skydio's willingness to create drone systems for more than surveillance in conflict zones (21m29s).
• Skydio's identity as a company is different from pure-play defense contractors, and they focus on building dual-use technology, a flying sensor platform useful for various industries and applications (21m57s).
• The US military is a major customer of Skydio, and they are committed to supporting their mission, including attaching payloads and other things to their flying sensor platforms (22m11s).
• Skydio's latest flagship drone, the X10, has payload bays and modular attachments, making it capable of supporting various military missions, including putting munitions on board (22m33s).
• The company has thought deeply about how their technology will be used and trusts the military's judgment on how to use their drones, as they are people who devote their lives to protecting the nation (22m53s).
• Skydio is not building drones that are essentially flying bombs, but rather focuses on building best-in-class ISR (Intelligence, Surveillance, and Reconnaissance) systems (23m27s).
• The company is not taking the next step to turn their drones into more end-roll style weapons platforms, as it requires different technologies and expertise, such as building explosive devices and targeting systems (23m54s).
• The product trade-offs for building munitions are different from those for building ISR systems, and Skydio's product is better suited for ISR missions (24m18s).
• Philosophically, the company's focus is on making their product better for responding to 911 calls, rather than making it more lethal, which is a different mindset and DNA as a company (24m31s).
• The company acknowledges that there are contractors who specialize in making lethal machines, and they are not in that business, using the analogy of contractors who make Humvees versus those who make 50-caliber guns (24m59s).

Notion - Try it for free today (25m15s)

• Notion is a tool that has been widely adopted and is used extensively, with many startups claiming that adding AI to a product will change everything, but Notion has actually achieved this (25m23s).
• The TWiST team uses Notion all day long for various tasks such as databases, calendars, and even ad reads, and the team has fully embraced it (25m29s).
• Introducing Notion into a company can reduce stress as everything is documented, and new employees or those learning new tasks can refer to internal playbooks (25m41s).
• Notion's AI capabilities have enhanced its functionality, allowing users to search across all of Notion and other apps, generate documents in their style, and analyze uploaded PDFs and images (25m54s).
• The AI can also chat with users about any topic, making it easy to collect knowledge and ask questions about it (26m6s).
• Notion keeps everything in one place, preventing knowledge loss, and is particularly useful when employees retire or leave the company (26m24s).
• Notion can be tried for free by visiting notion.com/twist, and using this link supports the show (26m41s).
• Notion is a powerful and easy-to-use product for recording all data in one place, and it is being used by many, including for personal and family offices (26m51s).

Drone light shows and military implications, Skydio's mission and hiring (27m24s)

• Drone light shows, often seen in China, can be viewed as a display of power and a glimpse into the future of warfare, with the potential for thousands of drones to be used in combat, identifying and targeting individuals with precision (28m16s).
• Most drones used in light shows rely on GPS, which is often jammed on the battlefield, rendering them ineffective, but Skydio drones use a visual navigation system, making them more suitable for military applications (28m4s).
• The development of drone technology is critical for national security, and the US needs to have a strong industry and robust policies in place to keep up with other countries, including having the ability to manufacture components domestically or through trusted allies (28m54s).
• Supply chain security and integrity are crucial, as relying on foreign manufacturers for components can create vulnerabilities and hinder the production of drones (29m22s).
• Skydio is proud to support Taiwan and is hiring engineers to work on exciting projects, including developing drones that can help people do their jobs better and safer (30m3s).
• The company is also exploring other use cases for its drones, including tracking cattle on ranches, which is a highly requested feature among investors (30m39s).
• The cost of drone technology is expected to decrease as it improves, making it more accessible for various applications, including building security and arm security (31m34s).

Future applications of drone technology and hardware startup challenges (31m44s)

• A documentary on Netflix about the 1982 Alpine Meadows Avalanche in Palisades, Tahoe, highlights the importance of monitoring snow conditions to prevent avalanches, and how drones can be used to test the snow and drop explosives to trigger controlled avalanches, reducing the risk to humans (31m54s).
• Drones are being used in various high-stakes scenarios, such as search and rescue operations after natural disasters like hurricanes, where they can help map and assess damage, and even rescue people (33m3s).
• Some drones have the capability to carry payloads that can rescue humans, such as dropping flotation devices or batteries to help people communicate (33m31s).
• In search and rescue operations, one of the most common items dropped by drones is a battery charger, as people often have phones but run out of battery (33m44s).
• Some drones are powerful enough to lift people out of dangerous situations, and it is likely that this technology will be used by lifeguards and coast guards in the future (33m59s).
• The technology used in drones is similar to that used in electric vertical takeoff and landing (eVTOL) aircraft, and it is likely that drones will reach massive scale before eVTOLs (34m22s).
• The use of drones to rescue swimmers is a developing technology, and it is likely that we will see more of this in the future (34m42s).
• The development of technologies like drones, VR, and AI follows a cycle where they initially capture everyone's imagination, and then founders work to create an actual use case, which can take around a decade (35m19s).
• Adam from Skydio is working on finding the highest use of drone technology, focusing on the most acute situations, also referred to as "hair on fire" situations, where the need is urgent and customers are willing to pay a premium (35m42s).
• This approach involves identifying customers who have a critical need for the technology and are willing to pay for it, such as the military, rather than targeting the masses initially (36m13s).
• Founders often start with the wrong approach, trying to make their technology available to everyone, but it's more effective to focus on high-margin businesses first and then iterate on the software to make it more accessible (36m35s).
• The value of saving a life, such as a Navy SEAL, is not just the human life but also the cost of the asset, which can be valued at millions of dollars (37m21s).
• Drones have a large potential for military, corporate, and other uses beyond consumer applications, and Skydio is an exciting company to watch in this space (37m50s).
• Despite Skydio's large footprint and potential impact, its valuation of $2.3 billion in its last round seems relatively small (38m10s).
• Hardware development is challenging, requiring inventory management, prototyping, and other complexities that are not present in software development (38m18s).
• Founders of startups often face significant challenges, including dealing with the complexities of crowdfunding platforms like Kickstarter, scaling their business, and managing production problems, which can be costly and time-consuming (38m43s).
• The process of scaling a business can be grueling, and a single supplier issue can cause significant delays, making a company only as fast as its slowest and least reliable component (39m16s).
• The challenges faced by startups, such as those mentioned, will be discussed in relation to the country's relationship with China and the Trump administration (39m28s).
• The companies mentioned as examples of these challenges include CAFX, Density, and Free Drum, which is a product that teaches users how to drum using drumming sticks (38m56s).

Geopolitical tensions and impact on American companies (39m31s)

• The SCO CEO's presence is appreciated due to a situation involving an American company dealing with geopolitical tensions driven by administration decisions (39m32s).
• This situation affects American startups, particularly those with international connections or implications (39m42s).

AssemblyAI - Get 100 free hours to start building (39m43s)

• AssemblyAI offers powerful speech-to-text modules that can easily turn data into features users love without a massive investment, requiring only a few lines of code to start building (39m45s).
• AssemblyAI's models are used by companies like V.O to autogenerate captions for video tools, demonstrating the potential of partnering with AssemblyAI for accurate and fast models (40m4s).
• AssemblyAI's models deliver at the industry's lowest word error rate, with 30% fewer hallucinations, making them a valuable partner for companies looking to create high-quality apps (40m26s).
• Developers can get 100 free hours to start building with AssemblyAI by visiting assembly.com/twist, joining over 200,000 developers who use voice data to create amazing apps (40m39s).
• The opportunity to process and utilize voice data from various sources, such as phone calls, podcasts, and Zoom calls, can lead to the creation of new features that delight customers (40m52s).

Presidential election results and implications for entrepreneurship (41m36s)

• The recent election results show a significant victory for one party, with a margin of four points, which is considered a substantial win. (41m37s)
• The victory is attributed to the party's pro-entrepreneurial stance, with a focus on capitalism and venture capital, as well as the selection of a venture capitalist as their number two and a billionaire capitalist as their number one. (42m33s)
• This approach resonated with the public, particularly young men who are capitalist and entrepreneurial, and who were previously not part of the voting group. (44m12s)
• The opposing party, which was seen as more socialist and less entrepreneurial, lost the election, with some attributing the loss to inflation and a long period of spending and low interest rates. (44m35s)
• The election results also show that Trump performed better amongst people of color, genders, and young men, while college-educated women shifted to the left. (45m26s)
• The outcome of the election highlights the polarization of wealth and the existential battle between socialism and capitalism in America. (42m11s)
• The role of entrepreneurship and venture capital in the election is seen as a key factor, with figures like Elon Musk, Chamath, and Sachs being mentioned as influential. (42m36s)
• The election results are also attributed to the perception of the two parties, with one being seen as aspirational and the other as not, and the public looking at the winning party as heroes. (45m8s)
• A recent image shows the shift in support for Trump across the electorate, with 12 demographic groups shifting towards the Republican Party, while only two groups, 65-year-olds and above and white college women, shifted towards the Democrats (45m50s).
• The groups that shifted the most towards the Republican Party were Hispanic, Asian, and 18 to 29-year-olds, which is a significant change as these groups are typically associated with the Democrats (46m37s).
• The scale of this shift is impressive, and it's surprising that everyone seems to think they were right about what should have been done or why they won or lost, indicating a lack of learning from the election results (47m3s).
• The divergence in results between Biden and Harris, despite not much policy difference, raises questions, and it's clear that the Democratic party needs a new set of leadership as the Biden era is over (47m38s).
• The stock market has reacted positively to Trump's victory, with the Dow Jones Industrial Average, S&P, and NASDAQ all up, indicating a lot of optimism in the market about the next Trump Administration (48m11s).
• There is dissonance between the business community's opposition to extreme tariffs and Trump's policy to implement them, raising questions about whether Trump was lying or if his team thinks he will actually implement these inflationary tariff moves (48m30s).

Tariffs, immigration policies, and economic impact (48m49s)

• Trump often makes statements that are considered outlandish or impractical, and it's up to the people around him to execute a more feasible version of his ideas (48m50s).
• Trump's stance on immigration is expected to be more focused on deporting people who have committed crimes, such as beating up police or dealing fentanyl, rather than deporting 15 million people as previously stated (50m14s).
• Trump's policies, including tariffs and labor shortages, may not be as severe as initially promised, with some believing that they will be scaled down to a smaller size (51m1s).
• Trump's statements are often seen as exaggerations or lies, but those close to him interpret his words as setting ambitious goals, with the understanding that the actual outcome may be more moderate (51m23s).
• Trump has expressed support for high-skilled immigration, suggesting that graduates of US colleges, including junior colleges, should automatically receive a green card as part of their diploma (52m16s).
• A statement was made suggesting that individuals who graduate or receive a doctorate degree from a college in the US should be allowed to stay in the country (52m35s).
• The statement was later backtracked, clarifying that it only applied to high-skilled immigrants with PhDs and not to people crossing the border (52m59s).
• Steve Bannon, the architect of MAGA, discussed immigration, suggesting that millions of illegal immigrants should be deported, starting with those considered "insane" or criminals (53m16s).
• Bannon argued that deporting these individuals would help create opportunities for African-American and Hispanic men, despite the Congressional Budget Office estimating that it would result in a 1% decrease in GDP (53m46s).
• JD Vance was also asked about the issue and suggested that deportations would be done gradually, "like a sandwich," rather than all at once (54m25s).
• The topic of prediction markets was also discussed, with the speaker noting that they were effective at incorporating real-time information but not as good at making long-term predictions (54m46s).
• The speaker mentioned that prediction markets, such as Polymarket and Robinhood, were more accurate than pollsters or pundits in assessing the outcome of the election (54m52s).
• Polymarket was noted to have been more accurate than the networks in calling the election, being about half an hour ahead (56m8s).
• There is a discussion about election predictions and how some sources have been wrong for a long period of time, despite being given credit for being right about certain things (56m11s).
• The charts show that a candidate, referred to as "she," had a lead only briefly, specifically two weeks after "they hot swapped Biden," and then her lead went straight down (56m27s).
• The candidate had two instances of leading in the polls: one at 53% and another later on, with the first instance occurring between September 22nd and the end of September (56m57s).
• The popular vote predictions also showed that a candidate referred to as "TR" was not expected to win as recently as September and October (57m7s).
• The discussion highlights the imperfections of prediction markets and the importance of considering them as part of a larger package (57m29s).
• A question is posed about setting up a prediction market with an over/under of 1 million, although the context and specifics of this market are not clearly defined (57m37s).

Prediction markets (57m41s)

• A prediction market is being discussed, with one person taking the "under" option for the number of deportations, while the other person is unsure and thinks it's a serious issue, with 15 million being a serious number (57m41s).
• The uncertainty surrounding Trump's actions and promises is due to the influence of different people on him, including his friends, such as Saak and Shath, and the more reactionary right, including Bannon (57m57s).
• Bannon has stated that he doesn't care about 1% GDP, which is a significant amount of money, and it's unclear who Trump will listen to, with the business people being a possible influence (58m22s).
• The key to understanding Trump's agenda is to monitor who he puts into his cabinet, as this will indicate whether he will listen to tech-driven, pro-business individuals like Elon, Sax, Chth, Peter Thiel, or JD Vance, or if it will be a pro-isolationist, tariff-driven agenda (58m39s).
• There is a dissonance between the two sides, with some people excited about Trump's tech side, while others want to implement a 15 million person deportation, and it's unclear who has more influence (59m8s).
• Trump's motivations include being liked, making money, and avoiding jail, and winning the presidency allows him to cancel or push off legal actions against him, including three outstanding cases and one sentencing (59m24s).

High-skilled immigration and antitrust policies (1h0m7s)

• High-skilled immigration in the US is expected to increase by at least 25% during a potential second Trump Administration, with the possibility of granting citizenship or green cards to high-skilled immigrants (1h0m39s).
• The motivation behind this increase is believed to be Trump's desire to build business relationships and connections, as he no longer needs to win elections and is now focused on legacy, money, and power (1h1m4s).
• Trump's priorities are expected to shift away from the "hard Maga" community, which is seen as isolationist, and towards the business community, as he uses his relationships with the former to get into office (1h1m45s).
• Trump's approach to antitrust policies is expected to be based on personal relationships and preferences, rather than a set of rules, with companies like Facebook, Amazon, and Apple potentially facing challenges due to Trump's dislike of their censorship and power (1h3m27s).
• This approach is seen as unhealthy, as business leaders may feel the need to publicly show support for Trump in order to avoid challenges to their mergers and acquisitions (1h4m15s).
• A potential second Trump Administration may lead to a more relaxed approach to mergers and acquisitions, with the exception of companies that Trump dislikes, which could face challenges (1h2m54s).
• The example of the Time Warner AT&T merger during the first Trump Administration is cited as an example of Trump's pettiness and willingness to use his power to influence business decisions (1h4m27s).

Political influence on business dynamics and media (1h4m35s)

• The current system of political influence is not perfect, and it is believed that those who support a particular party or politician, whether through votes or donations, will have an outsized voice in the political system (1h4m41s).
• The spending of money on politics, including super PACs and fundraisers, is considered a form of freedom of speech, but it raises concerns about the influence of wealth on politics (1h5m14s).
• The recent election saw a significant amount of money spent on ads, with the Democrats spending around $1 billion and several individuals on the Republican side, including Elon and Jeff, spending $50-150 million each (1h5m45s).
• There is a concern that the amount of money involved in politics is problematic and that alternative systems, such as public funding of elections, should be considered (1h6m1s).
• Some countries provide a budget to the final two or three candidates, which seems like a better idea than the current system (1h6m8s).
• The Trump platform has cited public funding of elections as something to be looked at, and it is noted that Trump spent nearly $10 billion on his presidential campaign (1h6m16s).
• The influence of money on politics is seen as problematic, with the example given of watching a baseball game and seeing a large number of political ads, which is not considered a good use of money (1h6m43s).
• Buying blocks of broadcasting time on cable news to promote a candidate is seen as an outdated strategy (1h6m57s).

Mergers, acquisitions, and startup liquidity post-Lena Khan (1h7m2s)

• Mergers and acquisitions are expected to increase, with companies like UBS and Merger Market expressing enthusiasm, and startups in the media industry, such as Discovery, NBC, and Comcast, are likely to be consolidated due to struggles in competing with YouTube and TikTok (1h7m6s).
• The media industry's need for consolidation is driven by the loss of monopoly on communication, and companies like Amazon, Apple, and Google are no longer bidding on entertainment assets in a major way, although Amazon did buy MGM (1h8m20s).
• Consolidation is also expected in the tech industry, with companies like Disney buying Marvel, Pixar, and Star Wars, and startups in the SAS space may be bought and sold like trading cards, with valuations of $5-10 billion (1h9m6s).
• The venture industry is based on the power law, where hitting an Uber or Airbnb and going public is key, and the ability of companies like Airbnb and Uber to buy smaller startups is crucial, but this is currently hard to happen due to restrictions (1h9m31s).
• Companies like Lyft and Instacart are still independent because Amazon and Tesla cannot buy them, but potential mergers and acquisitions in the autonomy space, such as Amazon buying Uber or Uber merging with DoorDash, could unlock value for shareholders and society (1h10m1s).
• The question remains whether there is a functioning market for series A and B startups post-Lina Khan, with a potential gap between private market valuations and big tech's willingness to pay, and it is unclear how big this gap will be and how long it will take to unwind (1h11m4s).

Secondary markets, Lyft and DoorDash valuation trends (1h11m26s)

• Large companies like Uber and Tesla have the potential to leverage smaller companies' assets to accelerate growth and create new opportunities, with valuations working themselves out due to competition (1h11m26s).
• The significant difference in valuation between Uber ($150-160 billion) and Lyft ($5.8 billion) makes Lyft a potential target for acquisition, which could be beneficial for the market and create a new wave of investments (1h12m55s).
• Consolidation in the market, such as the acquisition of Postmates by Uber, could be good for the market, creating a new wave of investments and showering money back to limited partners (LPs) (1h13m14s).
• Secondary markets are showing signs of life, with offers for shares in companies increasing, and bids are being made at 25% off, rather than 75% off, indicating a potential end to the logjam in the market (1h13m51s).
• The increased interest in secondary markets is correlated with the end of the Trump presidency and the Biden-Kamala era, and the start of a new era (1h13m58s).
• Startups in the Launch or Jason portfolio that are seeing the most interest from secondary market investors are those that are growing, particularly consumer or SaaS companies with doubling revenue year over year (1h14m14s).
• Investors believe that it is easier to buy a growing company valued at $1 billion than to make an incremental bet on a public market company or a startup without product-market fit, indicating a potential resurgence in M&A and IPO markets (1h14m35s).
• Vibrant markets are emerging for big names like Stripe, SpaceX, and Andrel, and this trend is starting to trickle down to smaller companies (1h15m6s).

The future of search engines (1h15m15s)

• Perplexity, a search software company, has raised a new round of funding at $9 billion, with the round not yet closed (1h15m55s).
• The company's valuation is almost 200 times its annualized revenue, which was reported to be around $50 million last month, putting it at a $4 million monthly run rate (1h16m29s).
• This valuation does not make logical sense, and it seems that investors are making a deep bet that Perplexity can catch up to its valuation and potentially take a significant share of Google's market (1h16m49s).
• Perplexity's user experience is interesting, but it may have already hit its peak valuation, and Sam Altman's OpenAI is also working on a search product that could compete with Perplexity (1h17m0s).
• A comparison of search results from Google, Perplexity, and OpenAI's GPT search showed that OpenAI's results were preferred for their simplicity and clean interface (1h18m4s).
• The valuation of Perplexity is likely based on its potential to take a significant share of Google's market, with every percentage point of search market share worth a large amount, estimated to be around $100 billion (1h18m20s).
• To justify its valuation, Perplexity would need to capture a significant percentage of Google's market share, with even 1% of the market being worth a substantial amount (1h18m50s).
• The concept of a fair search is discussed, with the example of searching for flights from New York to Austin, highlighting the importance of unbiased search results (1h18m52s).
• Google has developed specialized databases and tools for specific categories like shopping, flights, and local searches, which have taken decades to perfect and will take AI companies time to replicate (1h19m17s).
• A comparison of search results from Google and other AI-powered search engines, including Search GPT and Perplex, was conducted, with Google performing poorly due to the presence of ads (1h19m46s).
• The number of ads is considered the Achilles heel of Google, as new products without ads may offer a better user experience (1h19m55s).
• A hypothetical scenario is proposed where Google's ads are removed and compared side-by-side with other search engines to assess the impact on user preference (1h20m11s).
• The possibility is raised that even without ads, Google's search results may still be inferior to those of Search GPT and Perplex due to the underlying technology and starting point (1h20m25s).