#144 — Allbirds Pivoted to AI Data Centers | SpaceX $1.5T IPO, Anthropic $800B, $175M Seed Rounds
April 17, 2026 · Listen · All episodes · Chat with the show's AI
Jessica Lessin, Dave Morin, Brit Morin and Sam Lessin debate the tech of the week.
Full transcript (AI-generated — may contain transcription errors):
Sam Lessin: That all the money and returns will pool up in nonprofits because for-profits get so whacked on making smart allocations. But it's funny, 'cause for me you're like, do you hold or sell SpaceX, is actually not a question is it worth $1.5 trillion. You have to ask yourself is it worth $750 million, right? And that's like a very-
Jessica: Correct
Sam Lessin: ... different question.
Jessica: Yes.
Sam Lessin: Right? Like-
Dave Morin: More or less. Is it no or is it yes? We'll debate the tech that's best. When we get more or less. Dave and Brit plus Sam and Jess put it all right to the test. More or less.
Jessica: Hi, friends. Welcome to More or Less. Brit's trying to do some triage on our sound, and I just started.
Brit Morin: Here's what's happening.
Sam Lessin: It's not, I, I was trying to start the episode in a Waymo, which would've been awesome, but you guys were late.
Brit Morin: Oh. Well, okay. Sam is on, by the way, not even wireless headphones right now. Full wired. Like, 2005 called, Sam, and it wants its pair of headphones back.
Sam Lessin: No, this is the new thing. Brit, you're so fucking behind. Everyone's back to wired headphones.
Brit Morin: Your microphone's dangling in the wind-
Jessica: Wow
Brit Morin: ... as you make your way into your office.
Sam Lessin: I don't have a, I don't have access to my office. I never go to it, so I don't know how to get in. And so I'm waiting on the street for someone to let me in.
Jessica: Okay. So we're gonna do a little lay, s- setting the scene. But dear listeners, we promise we have a great episode for you, 'cause by the way-
Brit Morin: And Dave's not here, by the way. Just so everyone knows.
Jessica: Well, that was gonna be part of my scene setting.
Brit Morin: Oh, okay. Set the, set the scene.
Jessica: But before we brace for an episode of AI bubble talk, SpaceX financials revealed, and so much more, I have to give you the lay land. So Brit looks like she is polished in a cardigan somewhere-
Brit Morin: Hmm
Jessica: ... very put together. Would that be right?
Brit Morin: Thank you. Yes.
Jessica: Yeah.
Brit Morin: I am in my office-
Jessica: Okay
Brit Morin: ... which I did not have trouble getting into because I come every day.
Jessica: Great. Sam is stranded on the street, hair very, you know, sexually blowing in the wind-
Brit Morin: Sexually? Ooh
Jessica: ... with wired headphones and a glare.
Sam Lessin: Yeah, which is all, all the kids are back to. I'm stuck outside my office 'cause I don't know how to get into my office, and-
Jessica: Okay
Sam Lessin: ... that's just how it is. But someone will eventually let me in. The people who work in this office claimed that they went for a walk. I think they're in their apartments running to the office to let me in.
Jessica: Yeah, I think that was a work from home day until the boss showed up.
Sam Lessin: And in fairness to them, it's a very rare occurrence, so they really, they're not wrong. They're just wrong this one time.
Jessica: They went for a walk. I love this. Okay.
Sam Lessin: That's literally what they told their employer.
Jessica: I just landed in Austin, where guys, there's no Waymo. And this is the first time I've experienced Waymo withdrawal. When I was flying here, I'm here for a conference, I was, like, on the plane Googling, "Is there Waymo in Austin?" I was like, "Phew, there is. It's through the Uber app, great." Also love Uber.
Sam Lessin: No you don't.
Jessica: Open the Uber app.
Sam Lessin: Do you?
Jessica: Did- no, I do.
Sam Lessin: Wait. They give you, you can get Waymos in Uber?
Brit Morin: Okay. First of all, you can only get Waymos through Uber in Austin, which is the weirdest thing ever.
Jessica: Okay. Guys, you obviously have not read any of the information's great reporting on Waymo. Waymo has a three-pronged business strategy. I don't know. They have their own network in certain cities, and then they're working with other rideshare providers on the back end in other cases, like the Uber partnership in Austin. I am sorry to report this partnership does not appear live and well. When I go to the Uber app, as I do, I do not see Waymo options.
Brit Morin: No, it's because it's a roll of the dice. So the way it works in Austin, by the way, which is my hometown-
Jessica: Ugh
Brit Morin: ... is you pick a Waymo, and it's a roll of the dice if you're gonna get one or not through the Uber app. And, and so I actually am Waymo lucky. I end up getting Waymos a lot in Austin. I think right now there's a bunch of tech people come in Austin already, and a bunch of them flying to Austin, namely my husband and you, Jess.
Jessica: Yes, we will both be here. Yeah.
Brit Morin: And so they're, I think there's just higher demand.
Jessica: I am sorry, I cannot be a proponent of a service that gives me something based on a roll of the dice. This is not how I operate my life.
Brit Morin: Everything's a roll of the dice in technology, Jess.
Sam Lessin: All right. Here's the thing. I actually just think you need to get into the gatekeeper where they on- where you get all the Waymos. Like, this is, like, remember how Uber very smartly gated-
Jessica: Well, obviously I am one tweet away from that happening, because I have become a Waymo influencer.
Sam Lessin: Uber did a very smart thing which turned out to be, I guess, tech, so quite, somewhat illegal. I don't know. Remember when they started making all the politicians never get Ubers 'cause they didn't wanna get regulated? They had, like, a gatekeeper which, like, kept out-
Jessica: Oh
Sam Lessin: ... all the bad people from getting Ubers.
Brit Morin: Yeah. Can we get on the Waymo whitelist?
Sam Lessin: And now they're, they just need to do the inverse. Wasn't that, Jess, you remember this. Wasn't it, they got, they got in trouble because they basically-
Jessica: Yeah
Sam Lessin: ... created a-
Jessica: Yes.
Sam Lessin: ... what is it, black ball? Was it called black ball?
Jessica: It was called gray, gray balling. Gray-
Sam Lessin: Yeah, which kind of-
Jessica: Gray balling. Gray
Sam Lessin: ... sounds like something totally reasonable. I mean, not nice, but totally reasonable. I just, you need white ball.
Brit Morin: Yeah.
Jessica: I just think I have a problem with, like, the Russian roulette approach to getting my Waymos. It's like your hope is up.
Sam Lessin: Yes. It's ca- reliability is kind of one of the key... No, like, the only reason I now use Waymo is, like, you actually can get them within 10 minutes wherever you want them. If it di- if that weren't the case, you'd never open the app. But the fact that you can do that now-
Jessica: I mean, I get them, I schedule ahead, they're on time to the minute. And I gotta say, and the internet is skeptical of this claim, but as someone who's commuted to my office for a long time twice a day, Waymos find faster routes. Every day. They are optimizing the Bay Area traffic with some AI stuff in ways that's faster. And it's, any time I get in another ride sharing service, the time to destination goes up. It starts at 24 minutes, it ends at 34 minutes. Every-... Waymo I've had in the last two days has been shorter.
Brit Morin: This is not just the future of autonomous driving of Waymos, I think it's autonomous driving in general. Because, like, we're investors in Coco Robotics, who have those little robots that take things to your door for, like, DoorDash and Uber Eats and stuff, and they also get faster destination time because they're taking back alleys and they're taking optimal routes.
Sam Lessin: Well, to be clear, sh- they, Uber could do that too. That's just a better product experience. You get to, like, lowball people and then, and then improve. There's no reason that Uber human drivers-
Jessica: Well, that's what I was wondering. But that, I, now you're y- yeah. But they're not lowballing because-
Sam Lessin: They're, they're, I think they probably are if they're smart. Like, why wouldn't they lowball and then make you exceed expectations?
Brit Morin: Speaking of Uber, can we talk about the Uber CTO news that you published this week?
Sam Lessin: Wait, before we do that, can I make one other ode to, to Waymo? Which is, here's the reason I like it, is the thing, I actually literally go to San Francisco more because of Waymo, right? Because-
Jessica: Clearly you should get a key card.
Sam Lessin: I, I'm, I'm literally gonna go to a friend's office 'cause I can't get into my own office. And luckily I have a friend around the corner.
Jessica: I have an office. You can go to my office.
Sam Lessin: That's all right. But here's the thing, is it's consistent driving style, smooth, so I don't get sick. My number one problem with Uber-
Jessica: I don't get carsick. I don't get nauseous.
Brit Morin: Same.
Jessica: Mm-hmm.
Sam Lessin: That's, that's the thing. And the, the thing is that, that the average Uber driver is worse than the computer at driving. And then really, every once in a while you'll get an Uber, and it's, like, some guy in a rice rocket, and he's just jamming on the brakes. And it's, and you're just like, "I'm so sick right now."
Brit Morin: What's a rice rocket?
Sam Lessin: Like, they're making me physically ill. Look it up. It's probably not a term you're supposed to use anymore.
Brit Morin: I feel like that's maybe a derogatory term.
Jessica: No, I agree. Car sickness down, efficiency up, podcast listening up.
Sam Lessin: I just emailed the entire way to the office, "Hey Larry, what's up? There we go."
Brit Morin: Oh my God.
Sam Lessin: "Someone's in my office."
Brit Morin: Larry.
Sam Lessin: We're, we're live.
Jessica: Larry, thank you for helping.
Sam Lessin: Thanks, man. We'll catch up in a bit.
Brit Morin: Does he have coffee in his hand, Sam?
Sam Lessin: No, he doesn't. By the way, you wanna see our, here's our chief... Look at this. This is Chief Compliance Bear. That's our chief compliance officer.
Jessica: Okay. No one wants a tour-
Brit Morin: Okay. Yeah
Jessica: ... of the Slow Ventures office.
Brit Morin: Great.
Jessica: Very cute. Okay. So we, this is not brought to you by Waymo, but could be. Also, guys, I love non-San Franciscans who come to San Francisco for work and experience Waymos and then go, like we do, like, full Instagram Waymo life.
Brit Morin: Waymo Maxine.
Jessica: And I also predict by the Olympics in LA, Waymo is just gonna be, like, everywhere.
Brit Morin: Next up, Joby will be flying everywhere.
Jessica: No.
Sam Lessin: No. No, great, this is where we lose you. This is where you just, like, take it and go too far.
Jessica: Guys, a lot of AI news. And I do want, we have not talked enough about SpaceX. SpaceX, by the month of June, but six weeks away, is going to try to have the most epic IPO of all time. So we're gonna talk about SpaceX and the information, stunning revelations that they are losing billions of dollars, specifically five. But, and I'm gonna make you guys do a, like, bull/bear case on SpaceX valuation. So prepare for all of that. But first, we have some news. Sam, I'm gonna give this to you because I believe you were an investor in the once knowed as Allbirds company, soon to have AI pivoted to a data center company.
Brit Morin: AI birds. Is that the official name?
Sam Lessin: This is Jonah Peretti all over again. Remember when, when, when Jon- I looked this up, two and a half years ago, BuzzFeed announced it was an AI company as a penny stock and fucking ripped for, like, a day and went back down. It's a great trade strategy.
Jessica: Yes. And, and it has not served poor Jonah well. But also, Jonah didn't then say he was going to get into the business of buying GPUs. He just wanted to convince us-
Sam Lessin: Oh, he would have
Jessica: ... that AI would do our surveys.
Sam Lessin: It was just a few years later.
Jessica: Oh, I see.
Brit Morin: Jess, can you back up and just, like, present the facts of the, of the story?
Jessica: Yes. I'll present some facts. I'll pre- I was hoping Sam would, but, but silly me. Okay. So this all came out through a filing, because apparently Allbirds, which you can, everyone knows Allbirds. You know, the, like, cloth shoe company. How else do you describe it?
Brit Morin: Well, Dave and Sam were, like, the first investors, I think. Right?
Sam Lessin: In, in fairness, I will take zero credit for the, th- this is not a Sam investment. We were investors as a fund, but my God, this is not a Sam investment. I don't do shoes.
Brit Morin: Well, it actually performed well for the fund 'cause you sold at the right time.
Sam Lessin: We sold it, we sold, I'll tell you exactly when we sold. We sold at, like, the series A or B, I can't remember. Because you started looking at the numbers, it was so insane. We're like, "The only way it makes sense to hold this-
Jessica: Selling at the series A is balls.
Brit Morin: I don't think it was the A. No, it was later than that, I remember.
Sam Lessin: Then it was the B. Then it was the B. Because it, it was getting so... It was a great product. Like, we love the product. Great vibe, j- great product. But the math became simple, which is the only way it made sense to hold it is if you believe that Allbirds was the next Nike. And we're like, "We do not believe that Allbirds is the next Nike," and so we did start selling.
Jessica: Allbirds, described by the Financial Times as the maker of wool trainers, which I love, very British-
Brit Morin: Seriously very comfortable, I have to give them that
Jessica: ... was once valued at more than 4 billion, sold this month for about 40 million. And this shell company, for shell listing, has informed people via a regulatory filing it is gonna pivot its business to AI compute infrastructure with a long-term vision to become a fully integrated GPU as a service AI native cloud solutions providers. It will be known as Newbird AI.
Brit Morin: Newbird.
Sam Lessin: It's just a cheaper way to stack. I mean, like, this is the thing is, like, it's still expensive to get public, and there's a bunch of people who wanna be public for cheap access to capital. I've actually looked into this. And, like, honestly, like, buying a penny stock is, like, cheaper than the cost of the lawyers and the bankers to go public in some cases. And so that's all this is, is just, like-
Jessica: Okay. Well, that, that, that's a great... So- Sam, what is the temperature on these SPAC-like shell listings? Because I don't think they've gone so well for the companies, but this is still a thing, and why is it a thing?
Sam Lessin: Thematically, no one thinks they go well, but then everyone thinks there's an exception, and maybe there are some exceptions to it, right? Like, a- and the reality is these types of things specifically, there, there's like some play that like requires cheap access to capital on a narrative. It's like, it's not a game I enjoy, but I understand that like there's some haranguings you can do with it. It's just funny that like effectively-
Jessica: Who invests in these?
Brit Morin: Really weird hedge fund people.
Sam Lessin: Well, it's not even weird hedge fund people. The, the reality is there's all sorts of like covenants and deals that go into these types of situations where like if you really wanna be wonky about the finance of it, it's pretty hard to lose money, and there, it, there's a ton of asymmetry on them, right? And so like it's just a, it's a very bottom feed-in-need strategy. But the reality is, is like even if the stock trades down, like there's all sorts of ways that people make money on putting these things out or doing these types of structures, so they have a bunch of warrant coverage, and you have all these covenants and blah, blah, blah. It's totally not my world, but like a rationale to it, um, in terms of how it plays out. And, and again, it's not as like good for the companies, but people do make money on these things.
Brit Morin: At first when I saw the headline I thought it was gonna be something really cool and interesting where like everyone that's walking in their shoes is somehow creating more compute or like there's something cool about it.
Jessica: That's a very Brit, Brit-
Sam Lessin: That's a very Brit thing
Jessica: ... Brit is so optimistic. She
Sam Lessin: It's great.
Brit Morin: No, no.
Sam Lessin: It's actually, it's I n- I need this in my life.
Brit Morin: This would tie it together for me.
Sam Lessin: My favorite irony run right now, guys, is you guys remember Boom Supersonic?
Brit Morin: Yes. Oh, they totally pivoted.
Sam Lessin: Well, actually, but here's why. It's because it was the dumbest business. Like, this was a company that was absolutely-
Jessica: Okay, so Boom was gonna create supersonic airplanes, right? That's what they were gonna do?
Sam Lessin: Yes, it, it, it was like an terrible business. It's like a very nice vision in the Elon style, like cool, like Concorde 2.0, but like from a practical perspective it's like no fucking way is this gonna work. No way is this gonna work, right? And so you have all these investors marking this thing up on the story 'cause it's cool people and it's a cool vision, you're like this is just completely nonsense. Hilariously, it's gonna be worth a fortune because they couldn't get access to jet-
Jessica: Why? What happened?
Sam Lessin: Because basically they couldn't get, they couldn't make jet e- like they couldn't get access to jet engines, and there was like no way that they were gonna make their own jet engines that w- that, that would get certified and be able to fly. But they got far enough along, and then A- I think AI probably helped them with this, that they have a turbine they can use to run data centers, power for data centers. So they're not a supersonic company, they're just a jet engine company because they couldn't get anyone-
Jessica: Hmm
Sam Lessin: ... to sell them jet engines, right? Or like make them for them. So it's like hilarious, like you just have to be at the table story where it's like people who invested in it are actually gonna probably gonna make a ton of money, but completely for the wrong reasons, right? Or like not 'cause the idea was good. The idea was bad, right? But like they're gonna get away with it. And you, you kinda gotta love it, right? Like the major swerve on it.
Jessica: We should probably cover more energy stu- not in a cover, like to the degree this podcast covers anything. But like The Information has a maybe six-month-old, five-month-old AI infrastructure and energy newsletter, which is booming. And I was talking, as we have two writers for it, Anisa and Anne, and I was talking to Anne yesterday 'cause she was in San Francisco for an energy conference. And I don't know, maybe sh- if, uh, uh, I don't know if she told me this on or off the record, but she thinks this whole like energy crisis is way overblown and that we are only using half of the energy we have in the-
Sam Lessin: And that's before Venezuela
Jessica: ... world today. And that's for God's sake.
Brit Morin: Oh, God.
Jessica: And Hormuz. Anyway, so she and her source, uh, she's like an old school energy reporter, and they are very skeptical of this energy scarcity narrative. But anyway, I thought that was interesting. Obviously we don't really know 'cause we can't predict demand, but it makes sense to me that there's a rush into all of that energy stuff. So speaking of booms, let's talk about SpaceX, guys. Okay. Are, do we have bulls? Do we have bears? What are we thinking? The, and I'll also tee this up. I was kind of, I, I, the more, I'm spending a lot of time talking to investors w- who, you know, big public market investors about how they're looking at possible Anthropic, SpaceX, and OpenAI IPOs. And I gotta say, by and large, and it's anecdotal, but there are enough of them, they are very, very excited about these companies, and they're selling down their Mag 7 positions a little bit to, or preparing to, to like go all in on these companies. So I'm sure there are other points of view, but I've just been struck-
Sam Lessin: See, but I always wonder, are these people tax-free or taxable? 'Cause this is w- the most interesting thing.
Jessica: Same way.
Sam Lessin: Well, this is the thing I just think is so weird about how the public markets work in these big funds, right? Which is there's two very different types of investors that invest in these things. One are people who, like, for whatever reason, have tax-free structure, so they can switch what they own without paying taxes, and the other people get taxed when they sell.
Jessica: These are like the world's largest professional money managers. So they presumably aren't tax-free.
Sam Lessin: Well, it depends who they're managing money for. I mean, it's, it's complicated, but it, this is just like this thing that is like selling down super marked up positions-
Jessica: Everyone is the answer
Sam Lessin: ... is like selling down super mar- high marked positions, right, where you have to pay enormous taxes, like, to switch into something like-
Jessica: Hmm
Sam Lessin: ... an open air or whatever.
Jessica: Oh, that's interesting.
Sam Lessin: You basically aren't betting ... You're betting that whatever you're selling out of is gonna underperform everything else by 50%, right? And that's this, like, crazy hurdle to get over emotionally and mentally where you're not actually saying... Like, I'll give you an example of the SpaceX. Like, fortunately, 'cause, like, I have challenges with Elon. Elon's a complicated character, pros and cons, but, like, SpaceX is so cool that, like, I invested a bunch of money in SpaceX a long time ago. I'm gonna have an enormous mark on that when it goes out, regardless of where it goes out. Good for me, but here's the problem. The question of what I do with that is really a challenge because I don't wanna pay 50% taxes or 40, whatever it ends up being in California to, like, rotate out. I'd rather just be long it and hold it because you'd have to believe not only is SpaceX overvalued or where... You have to have the opinion that it's so bad, right, that it's gonna underperform the rest of the market by 50% from where it is for it to be worth taking the tax burden of selling it. And I think a lot of what you see in these high marked positions-
Jessica: That's a good question. Mm-hmm
Sam Lessin: ... the, the long you see these high marked positions from my perspective, especially with people who like if you're sophisticated you can borrow against your positions, et cetera, is like they get super marked up when they're right, and then you really can't sell them. And so that creates this floor on the pricing where, like, no one wants to rotate out of them. Like, it has to be really painful to rotate out of them, right? And that is a really interesting dynamic that, you know, is part of why the market is so disconnected from the economy from my perspective, right?
Brit Morin: Right, because, and the S1 is saying what? They're gonna go out at 1.75 trillion as the valuation? And then I'm confused by the numbers too, Jess, because The Information reported something different from Reuters, right? So there's kind of like-
Jessica: Oh, don't, don't... Why? I mean, please.
Brit Morin: I'm just- S- I mean, obviously I know who's right. I'm just making sure that the numbers are all a little wonky.
Jessica: The, the valuation stuff is all pure rumor now. No, no one knows what... I mean, that, that isn't-
Sam Lessin: To me, it's just kind of irrelevant though, 'cause it is-
Jessica: Well, but, but let's take these one at a time here. Let's take these one at a time. First, Sam, that, that is a very good point, and I'm... But I assume there's some tax-shaving-
Sam Lessin: Not if you're... Like, if you're a university, yes. And, and that's the thing that's really interesting is, like, universities or people who are non-taxable get to do way better moves in the market than anyone who's taxable, right? And this, like, is a weird thing which is very bad, I think, for the economy long term, that all the money and returns will pool up in nonprofits because for-profits get so whacked on making smart allocations. It, it was funny, 'cause for me you're like, "Do you hold or sell SpaceX?" It's actually not a question, is it worth $1.5 trillion? You have to ask yourself, is it worth $750 million, right? And that's, like, a very-
Jessica: Right
Sam Lessin: ... different question.
Jessica: Yes. But from an... So that's an important consideration in these funds' allocations. But s- also, I think you look at the Mag 7 and, or whatever approximates it, and like, you know, is there a 50X story for those companies? Like, you're also thinking about that if you're an investor, no?
Sam Lessin: Totally. But, but, but there's no... The problem with that is, like-
Brit Morin: Give me a 50X.
Sam Lessin: I- i- i- 50X is a big number, but here's the thing. It, it's the same problem recursively, which is how big can companies get, right? When Facebook was trading at 100 billion, that was a big number. People were like, "A trillion-dollar company? That's insane," right? And what's happened is there's a lot of money that flowed into the system, everything rises, blah, blah, blah. The market is not the economy. And so all of a sudden, the 10X case has nothing to do with a thing you're projecting about the business. It's just, like, a bunch of, like, the world changes. And so for me, the question of, like, is there a 50X on any of these things has so much less to do with relative value than just, like, wait, like, how much money gets printed, and, like, a bunch of other factors like that. How big can things get? How big number go up? So then you're like, yeah, like, I guess it can over a certain period. But it's, it's more of a bet on the secular, like, economy than it is a specific company.
Brit Morin: And so is the bet, Sam, then that you think SpaceX would have to get to, like, 5 to 10 trillion in value to make this reasonable, if it's going out at, like, one and a half? Like, it's at least a 3X?
Sam Lessin: I think the basic point is, like, if you have high mark positions from zero, which SpaceX will be for everyone, right? Anyone who's in SpaceX is in it a lot lower than it's going out, in theory, I think, right? There's this thing which is like you really have to not believe to sell it, because the default course in speed is that all the big companies will kind of pace each other, because people have money and have to stuff it places, right? And so it has very little to d- like, the question of is there a 10X in SpaceX, there could be a zero if it falls off a cliff. It feels unlikely. The question is more like, you have a tax-free marked up thing. At what point are you willing to take a 50% haircut to get out of it? And you, you don't have... You have to believe it massively under-paces everything else you could invest in.
Jessica: So that makes sense for the existing investors though, but the s- performance of the stock is gonna also be largely shaped by new investors coming in, and that's the whole idea of going public, access to new capital.
Brit Morin: Right. Well, that's what I m- that's what I mean. I mean, investing as a new investor at the current valuation, you have to believe this is a 5 to $10 trillion company, I think.
Sam Lessin: Sure. Maybe, or you just have to believe here's the reality, which is, like, not enough people... Like, people will hold it long term, right? Just as they hold other things long term for the, for tax reasons as well as other things. So there's not that much sup- there's gonna be less supply than you think of shares, right? And then the demand for shares will have much less to do with, like, a specific thesis than it will be like, yeah, you kind of have to buy it, 'cause it's huge, right? Like, if you're indexing a bunch of stuff and it's in a bunch of indices, then, like, you just, it gets bought. And, like, and then, like, you have this thing where it kind of floats up with everything else, and the retail cult on top of it is a, is a bonus.
Jessica: Yeah. I, that would make sense. There, there are, there is money flowing out of these really big tech companies into, like, Asian chip companies though. So it's so point, like, point standing that you have to i- tolerate your taxes. But I'm not talking about investors who were in early and have huge markups. I'm just talking about the world's largest money managers who are buying and selling constantly.
Sam Lessin: It's a... Yeah. That's just an interesting question of who actually is trading this in for what purposes and what their tax structure is around it, because it is a big... I- if you say, "Hey, I have fresh money to deploy, where do I put it?" That's one thing, but what the recycling is just, like, killer. Like, you have to have a very strong anti-thesis-
Jessica: Well, there's not a lot of new LP money going into the system, so I think a lot of it's just, like-
Sam Lessin: Are you sure about that?
Jessica: But let me, let me explain this thing. I, I, I mean, I think this is why you h- I hear a lot of hedge funds targeting retail now, because they think-
Sam Lessin: 'Cause they're out of-
Jessica: ... that there's certain ins-
Sam Lessin: Maybe
Jessica: ... stir- I mean, I, uh, the top tech hedge funds have all told me this. They think that the institutional or sovereign wealth is sort of fixed, and they'll fight for a slightly more share of that, but they have to go to retail or other things. So, but-
Sam Lessin: On that note, bye ladies.
Jessica: Oh, my God.
Brit Morin: Wait, what just happened?
Jessica: He dashed and diced.
Brit Morin: What just happened?
Jessica: It is the bottom of the hour, meaning it is possible Steve has a meeting. I just don't, like-
Brit Morin: Was there any heads-up about this? Oh, my God.
Jessica: Maybe. Honestly, maybe.
Brit Morin: Okay.
Jessica: Okay
Brit Morin: Wow, okay
Jessica: It's The Brit and Jess Show, um-
Brit Morin: Thanks, Sam.
Jessica: We don't need him. Okay, but, but we have a picture with Space-
Brit Morin: Everyone should comment about this and give Sam shit on Twitter
Jessica: ... Yeah, just text him. I actually-
Brit Morin: Yeah
Jessica: ... I didn't even give him a chance. Sam has this weekly email, as many of our listeners will know, and, um, he wrote a particularly introspective one about AI and the crisis of meaning that it is precipitating, and this being a sort of key issue that has gone undiscussed in society and in the AI productivity. Even I got feedback on this email, which doesn't... Or, uh, this post which, which he also shared online and has apparently spiked his newsletter subscriptions. So I was gonna let him talk about it, but now I won't, but-
Brit Morin: Was it positive feedback or negative feedback?
Jessica: Well, I got two types, but it most had an element of, "If Sam is on something, please get him off of it." That was, like, the prevailing, you know, like implying that mushrooms were involved.
Brit Morin: Because he was-
Jessica: It was just very philosophical, very philosophical, even for Sam
Brit Morin: ... philosophical. Okay, philosophical.
Jessica: Yeah, yeah.
Brit Morin: Okay
Jessica: ... just a little, little loopy. Little loopy. Um, I blame the jet lag. Okay. But SpaceX's business, turns out it's not space, folks. The Star- Well, I guess it's kind of space.
Brit Morin: Obviously it's Starlink
Jessica: ... but Starlink-
Brit Morin: Yes
Jessica: ... three times as big almost as space launch.
Brit Morin: We were just talking about data centers, compute. Like, this is everything, right? And I think this is, like, Elon's way of getting data centers in space and everything that we need to power the AI future that we have. The space launch here that you're showing in this chart is 4 billion out of 19, right? So it's, like, less-
Jessica: Yeah
Brit Morin: ... it's about less than a quarter.
Jessica: It's small. This is something I wonder, and I don't know an answer to this, but, like, how long space economy do you have to be to be bullish SpaceX, right? Like, uh, 'cause they... And I'm interested as they really embark on their roadshow in earnest, like, how much part of their thesis is, or, or... I mean, I'm sure it's a part, but how much of it is, like, and the space business of launching things into space will be projected to go to whatever 'cause we're gonna have bases on the Moon and, you know-
Brit Morin: Yeah
Jessica: ... defense and all that.
Brit Morin: It also seems like Elon's moved a lot of his interest from Mars to the Moon recently. It seems like the-
Jessica: He has, yes. They've pivoted to the Moon.
Brit Morin: Which doesn't bode well for my bet with Sam about-
Jessica: I, I was gonna point that out, but-
Brit Morin: ... when the first human stepping on the Moon by 2040. But that, that wasn't my fault. That was Elon changing his strategy. So if he would've stayed on track-
Jessica: Which is exactly why Sam and I took the other position, but yes. You know, I mean, you know, we'll see.
Brit Morin: Oh, okay. Well, I'm still not giving up my bet yet. 2040 is a long ways away.
Jessica: Okay. But what any other SpaceX thought... I mean, the other thing I, I, I hear that wasn't obvious to me is how much this will be seen, this IPO will be seen as a bellwether for Anthropic and OpenAI even though there are parts of their business that are competitive, parts not. Just the idea of and the test case of a mega, mega-
Brit Morin: Of companies that, like, are losing, losing revenue and going out at, like, 90x or 100x their actual revenue on the market. And Anthropic this week I heard is also now raising at an 800 billion.
Jessica: Well, they're getting offers. I mean, this is like, I... One of the har- one of the hardest things... It's not one of the hardest things I do. One difficult thing is when a fundraising story becomes a story because, you know, Brit, hot companies, people are, like, sending them emails and writing letters at all, you know, moments, right? And so at some point the company decides to do a round or not.
Brit Morin: Yeah, but don't you think it has to do with all of the momentum in the last month and sort of the-
Jessica: Oh, yeah, yeah
Brit Morin: ... OpenAI versus Anthropic everything? And I mean, Anthropic's last valuation on paper was 380 or 360, something like that, I believe. And so now they're trying to anchor with OpenAI and-
Jessica: Well, I think, and I... We showed a couple weeks ago the revenue chart Information had and the lines. Like, we sort of talked, like, when will they cross, right? Or will they cross? And so I think it's, uh, it's still unclear. I mean, at the same time, Anthropic has major capacity issues.
Brit Morin: So many. Yeah, compute has been insane with Anthropic.
Jessica: And we have a story this week about them changing their pricing in r- a partial response to that. And so I, I don't know where these things stand. They, they seem kind of like-
Brit Morin: I think everyone has compute issues, though. It's not just Anthropic. It's like-
Jessica: Yeah, but I think Anthropic is more c- I mean, the w- the sense of word on the street, I mean, you can s- it, it's... You can see it either way, right? The, there are also critics of OpenAI who felt like they overbuilt. And in fact, Information had a story in the last week about some tensions between Sam Altman and Sarah Friar, OpenAI's CFO, on IPO timing, a lot of which came down to, you know, her concerns about these compute commitments and, and what OpenAI could potentially be left with. So, you know, but at the same time... And there was a memo that was leaked from OpenAI. Well, an, um, an OpenAI memo that was leaked. I, I think it was in OpenAI's interest for this memo to be out there. I also think it was written in a way where they wanted it to be out there, where they came after Anthropic, both for how it calculates ARR and also on this point of having underinvested in compute. So it is a problem for Anthropic.
Brit Morin: Well, and, and was that the same memo that was also leaked today about OpenAI's focus on the enterprise moat and how it's not about the model, it's about the entire system and, you know-
Jessica: I think so, yeah
Brit Morin: ... obviously con- condensing everything into Codex plus Chat and everything else. I think it, it leads to what I'm seeing, which is just, like, we've talked about this on the pod every episode. All of this is electricity. How do you get someone locked in? Because you could switch one model out for another, and if Claude's compute isn't holding up, I'm just gonna go over to OpenAI. And everyone at the frontier labs right now, I guess, seem to think that owning the enterprise and just getting people, like, super reliant on your stack is the only way to stay relevant and to win in, in the differentiation war. Google today launched Gemini on desktop.
Jessica: Mm.
Brit Morin: So Google's coming out hot with, with their response, and obviously we've got all the developer conferences coming up in May and June.
Jessica: I was gonna say.
Brit Morin: So it's like-
Jessica: This is what I say to my team. Starting, like, March, I'm like, "Guys, developer conference season. What's coming out? What's coming out?"
Brit Morin: Yeah.
Jessica: It's gonna be like alphabet soup of announcements and code names, but-
Brit Morin: I just think it's still hard to call any of this, like- I, I've been in board meetings a lot recently with companies who are like, "Yes, we're fully moved over to Anthropic," and it's like they show the t- the chart of when everything moved over, and it was, like, in December. And I'm like, "Of course, everyone moved over to Anthropic in December," but it's April, and who knows what, like, April 2027 will bring, you know? Everyone is gonna be launching new things all the time.
Jessica: You need the optionality. Like, and I, I mean, we have a tin- you know, tiny engineering team relative to all these companies with information. But it... my conversations with our team are like, "Okay, what do you think based on, like, roadmap and what you think now, what's our best structure for this? And is it Cursor, is it Claude? Is it one," you know, what- whatever it is. I get an answer, and then three weeks later they're like, "Answer changed. We think this approach is better."
Brit Morin: Totally.
Jessica: And then all of a sudden, like, I have an idea for something, and I'm like, "I wanna build that," and they're like, "Well, if you wanna build that, then the answer has to be that." So of course it's optionality. And I think the, um... Now, obviously big companies, y- you are doing these big enterprise deployments. I mean, how ironic that it's, like, the SaaS strategy when everyone's trying to rip out SaaS. But I also think at some point pricing will play a way, way bigger role in this, and i- i- if these total Anthropic and OpenAI bills, like, don't acknowledge that for many, many things you're gonna use cheap models. I mean, we have... I mean, Meta's AI works well. I mean, it's a consumer-facing, but, like, it's better at giving me what's happening with tennis than Anthropic and-
Brit Morin: Well, it just depends on the task that you're doing, right? So every company is gonna have to orchestrate their, like, local cheap model, their super, like, luxury, fancy, but quick and smart model, and it's not gonna be about tokens per engineer or whatever, like Uber and Meta are actually doing on leaderboards right now in their engineering departments-
Jessica: Token maxing
Brit Morin: ... 'cause that... Yeah, because that's not the actual best way to, to see if people are leveraging AI, right? When did they use the right amount of tokens to get the right amount of success? And I don't know how we're gonna measure that, but that seems to be what every CEO is thinking about right now.
Jessica: Do you have companies, Brett, that are token maxing, and what do you tell them? And for people who don't, I'm sure our listeners know, but it, it is kind of wild. Like, their big companies are incentivizing ranking people based on using the most, which equates also to the most expense, which is not historically how P&Ls have been optimized, but-
Brit Morin: I think the only facet of that that I like is that right now we're in the part of the curve where you just need everyone in the company to be using this. And so if there's a way to encourage... It's almost like a habit your brain has to learn. Like, there was a CEO the other day who was, who was, like, asking me, "Okay, I'm ready to try OpenClau. I'm gonna get my CTO to help me set it up." And I was like, "No, you should just go to Claude or GPT and ask it how to have y- you set it up." And it's like learning to think that instead of asking the person, I'm gonna ask the agent is a habit your brain has to learn and switch into. And for people in engineering, I think that's more native right now, or product. But for people in sales or HR or, you know, even some just non-technical roles, it's not native. And so the first step is just getting everyone to think AI natively. The second step is then to think about, like, okay, now how do I use these tokens more efficiently? And Jess, let me tell you, as a parent of an 11-year-old that I know we've talked about on the pod a lot, who is, like, token maxing, we looked at our, our bill, our token bill- ... for the last month for Ansel, our 11-year-old. Guess, guess how much money we had to pay for tokens in the last month that-
Jessica: $10,000
Brit Morin: ... I was just informed of this. Okay, less than that, but-
Jessica: Okay, good
Brit Morin: ... more than 1,000.
Jessica: Wow. Thousands of dollars, yeah?
Brit Morin: $1,500 of tokens that my 11-year-old has inadvertently-
Jessica: Well, not inadvertently. He's got a business. Now you just have to get him selling in, like, purchases.
Brit Morin: I know, but, like, we gotta monetize this thing 'cause, like, the Moran bank account can't sustain 1,500 a month for each child.
Jessica: Yeah. No. That... Sam also got the, uh, boys building games, which is totally... Like, they have just totally subverted all screen time rules by, like, convincing Sam this is in a different category. He doesn't quite see it yet, but it, it's quite funny to watch. So what else? We didn't talk... Did you and Dave talk about the OpenAI New Yorker profile last week by chance?
Brit Morin: Well, we had a long laundry list. I don't know if you, you... I know you were in Italy and you didn't catch- get to catch up 'cause we had Guillermo from Vercel on the episode last week-
Jessica: Oh, yes, yes, yes
Brit Morin: ... which was fascinating 'cause he's truly at the center. He's like the Switzerland across all the big labs and was telling us all the tea. It was on the laundry list of news topics, but we didn't get into it. But I, I think that, yeah, I mean, also Sam Altman's house got, like, attacked-
Jessica: I know. Horrible
Brit Morin: ... twice in the last week.
Jessica: Twice, yeah.
Brit Morin: So Sam Altman and OpenAI have definitely been through the thick of things in the last seven to 10 days.
Jessica: Yeah. No, obviously the violence is, like, tragic and scary. Uh, just for a, a, a second of media criticism, this was... So Ronan Farrow had been working on a profile of Sam Altman for I think he said 18 months. I caught wind of it a little over a year ago, just 'cause he was calling everyone, and the word on the street was that he was, like, probing some really serious allegations, like, none of which were in the story, and actually, you know, came out as sort of defending Sam in a lot of contexts. So y- it's interesting because I think there's some group of readers... You know, it was, it was a very tough look at his management style and personality. And what... For anyone who followed the saga of Sam being ousted as CEO The piece will be familiar to you, 'cause it retread a lot of that ground. But for other people, like the... Like, my inbox is full of people who are saying, like, "Oh, that could've been much wor-," like, not much worse 'cause they know of bad things, but just, like, there was so much anticipation that this was to be, like, this real hit piece, and it kinda coming out. Um, and we know, like, Sam was very, very anxious about the piece. The board was anxious about the piece. So yeah, from my point of view, it was sort of a nothingburger. But I say that as probably the person in the media who follows this story the most closely, so.
Brit Morin: Well, I think, though, the thing that a lot of people aren't understanding right now is that there's so much competitive pressure amongst all these frontier labs and Max-7 companies that, like, there's truly oppositional research teams inside each company that I've now heard about for probably five to 10 times, like for, for different stories and companies that have been planted by the other. And it's, like, the nastiest PR setting I've seen in all of tech. Like, I have not seen people do this kind of, like, drastic PR strategy since the early days.
Jessica: You know, these companies are also these personas and personalities, so have all this history. But, and so I actually think for Ronan Farrow, who's the reporter who took down Harvey Weinstein, like, to come out and not, you know, a- after 18 months of, like, following what all those competitors were saying, not find anything publishable or, you know, is sorta in some way a relief to people. But yeah, it's nasty out there. I mean, when we published some of Dario's and Anthropic's internal messages where he talked about why, uh, in the wake of, um, having lost the Department of War contract, you know, it was really a window into his thinking about, you know, he was throwing a lot of shit at OpenAI in that. Um, and now we're seeing this. So it's memo war. It's the, the era of the memos. We've reached that point in the cycle. But yeah, to be continued. I'm sure there'll be a lot more OpenAI news to come. Brit, what else is cooking? I've got a book recommendation, but what, what else is-
Brit Morin: Wait, well, hold on. I need to talk about this Carta news that's coming out-
Jessica: Oh, yeah
Brit Morin: ... because-
Jessica: Yes, yes, yeah
Brit Morin: ... yeah, I can give you, like, what's happening in venture capital land, which is... I know we've been saying we're in the bubble for a long time, like a year or two years, but truly we are in the bubble of all bubbles, and I don't know how, like, sustainable this is. So Carta announced the seed valuations are skyrocketing more than ever before. So between Q4 and Q1, things went completely vertical. Now the top 5% of seed rounds are topping $175 million valuations.
Jessica: Oh my God.
Brit Morin: This is 3X over the last year.
Jessica: Wow.
Brit Morin: And even the 75th percentile or 50th percentile, we're talking about, like, $45 million seed rounds, which is insane. Like, a typical seed round used to be $15 million, maybe 20. You buy 10% for a million and a half, $2 million. And now if you're doing that, you're actually under the 25th percentile. So it's totally crazy, and you might think, "Wow, this, this sounds a lot like 2021." And actually, it's double 2021. So it's, like, so it's, like, twice as worse as 2021. Like, if there's a graph that I can share, um, that, that Carta also announced today, and it is, like, the top 10% of startup valuations for Series D, C, B, et cetera, are now, like, 200 to 300% higher than 2021. I really hope, you know, we're gonna see a lot of trillion-dollar companies out of this AI boom.
Jessica: Does this make you sweat, Brit, as an investor? Like, what is the takeaway one should-
Brit Morin: It's making, like-
Jessica: ... draw from this?
Brit Morin: Well, so, like, we're about to go out and raise our next fund.
Jessica: Can you say that? Haven't you just violated some major thing?
Brit Morin: Okay, maybe I should take that... Okay. Let me- Let me start that again.
Jessica: You're fine. You said you're about to. You haven't.
Brit Morin: We're about to. We're not in process of fundraising.
Jessica: Just make sure you're not soliciting something. I don't know.
Brit Morin: Okay. I'm not soliciting investors-
Jessica: Oh, okay
Brit Morin: ... but we are going to raise our next fund soon. And I'm doing a lot of, like, data gathering about portfolio construction and all these things. And, like, when you run a portfolio construction model in a ven- as a venture capitalist, you're saying, "Okay, cool. I've got 100 or $200 million fund size. I, I'm gonna make X many bets at this amount of dollar per check in this fund." And typically, that would be very easy to forecast, 'cause I'm gonna make, you know, $32 million checks and this many-
Jessica: Right, right, right, yeah
Brit Morin: ... like angel checks, et cetera-
Jessica: Yeah, no, no
Brit Morin: ... and this much for follow-on. Now I'm like, am I going to make $32 million checks, or am I gonna make 10 $10 million checks, or am I gonna blend... Is the, like, where is this... Are you following where inflation's going? And if so, do I need to project that o- out over the next two to three years? Like, is the AI bubble going to keep going? Is it gonna fall dramatically? You know, there's all these questions you're asking yourself that you then need to, like, communicate to LPs who are gonna be, like, a lot of them, not, not the most sophisticated ones, but a lot of them are gonna be like, "Well, this doesn't compute in my spreadsheet. Like, we want 10% in every company for $20 million." And, and so, you know, I think that it's just this active conversation ongoing between GPs and LPs right now of, like, where do we even mark these things? And at the end of the day, you don't wanna be in the, like, lower quartile of companies, because honestly, the ones that are able to command the higher valua- valuations tend to be statistically the most successful. So it's this, like, blessing and curse where it's like, should I pay up, and how much of my fund do I put in at a $200 million valuation for a seed round?
Jessica: I mean, that's what's gonna return your fund, unless it doesn't collapse.
Brit Morin: At the end of the day, like, what I've come to is, like, it just has to be what percentage of the fund is going in rather than what percentage of equity you're getting out of these companies, right? Because, like, if I'm putting in a 5% bet from the fund, that's like a 5 million check on a $100 million fund. Like, that's significant, right? And if you can, if you can 100X that 5% check, like, you're in great territory. So anyway, I think fund math is changing, uh, and no one really knows how long we're gonna be in this bubble. But if you look at that same chart I just showed of what happened in 2021, I mean, the bubble only lasted for, you know, a year and a half or so.
Jessica: But this is AI, Brit.
Brit Morin: People are saying-
Jessica: It's gonna be different
Brit Morin: ... AI's gonna last longer.
Jessica: It's gonna last for-
Brit Morin: It's-
Jessica: I mean, what is AI even?
Brit Morin: Yeah.
Jessica: What is a bubble?
Brit Morin: What is a bubble?
Jessica: I do have to bounce in a second to do my, my real job, but I gotta go full millennial and plug Lena Dunham's new book, Fame Sick.
Brit Morin: Oh.
Jessica: So-
Brit Morin: Old school. Lena Dunham. I haven't, like, paid attention to what she's doing in a lot of years, since Girls on HBO.
Jessica: Since Girl- Well, I think this is the, her journey, which has had ups and downs-
Brit Morin: Yeah
Jessica: ... and horrors and show, like, some shows, some creative pursuits. But I obviously loved Girls when it came out as a 20, then 20-something in New York. And anyway, I'm maybe 10, 15% into the book, but I'm loving every word. She's, like, an exquisite writer, and I'm just, like, I'm, like, excited to find time to go keep reading it. So for, for for probably our female audience out there, but-
Brit Morin: I'll give another female audience media plug, and then I have a really interesting, like, airline and news announcement, and then we can wrap.
Jessica: Ooh.
Brit Morin: But okay. Margot's Got Money Problems, a new show on Apple TV, just started last night. It's Michelle Pfeiffer, old school, and Elle Fanning and Dakota Fanning in a new series that I find... I, I watched the first episode and really liked. And then-
Jessica: I'm gonna write that down
Brit Morin: ... in other news, airlines. You know, United is now launching this, like, you could get the full row in coach, and it, like, ex- e- expands into a bed. This was United's big news. Now Air New Zealand and other airlines are starting to prototype bunk beds in economy class, meaning literally triple-stacked rows vertically on each side, that you, you actually don't sleep in the whole flight. You sit in a chair in the, like, regular coach, and for, like, 500 extra bucks on your long-haul flight, you get four hours in the bunk bed to have a nap. And I don't know how I feel about sleeping in a-
Jessica: How do you wake someone up? I have a lot of questions
Brit Morin: ... triple-decker... You know. And plus, like, the snoring. I just can't... I'm like, "I'm not gonna be in the bunk next to the snoring dude." And obviously you want the top bunk. There's, like, so much strategy that goes into this. But I'm interested in all of the innovation happening in airline configurations and customer appeal right now. So fun fact.
Jessica: Yeah, that is a fun fact. Yeah, it's... I, I think that family row in United is cool, although I did... Today, I fly a lot of United, but not enough. I asked United, I asked... I gave my stats to ChatGPT, and I'm like, "Am I close to 1K?" And they're like, "No." I was like, "Oh, okay." Not in global services.
Brit Morin: Sorry.
Jessica: So I'm feeling a little-
Brit Morin: Womp, womp
Jessica: ... a little down. But okay, Brit. Well, it's been a pleasure. Thanks for-
Brit Morin: I know. I mean-
Jessica: ... staying on for the allotted commitments that was made to you, uh, um, that you agreed to in your calendar. But we, I guess, have to thank the dear listeners and viewers who stuck with us this far for the, uh, Brit and Jess Show. We should have a quorum next week, I think.
Brit Morin: Yes.
Jessica: But time will tell. Sam may decide to go to the office again.
Brit Morin: Exactly.
Jessica: Which will leave us all stunned.
Brit Morin: Yeah, no more Sam going to the office. I prefer him in the pool house.
Jessica: I mean, obviously we have to revisit the fact that, like, no one on his team was there, and then they were pretending they were go- for a walk. I think that's wonderful. So with that, we'll say toodle-oo, and, uh, see you back here next week for another episode of More or Less. Bye.
Brit Morin: Bye, guys. If you enjoyed this show, please leave us a virtual high-five by rating it and reviewing it on Apple Podcasts, Spotify, YouTube, or wherever you get your podcasts. Find more information about each episode in the show notes, and follow us on social media by searching for @moreorless, @davemorin, @lesson, @jlesson. And as for me, I'm @brit. See you guys next time.