10 Startups w/ Stock Grants That’ll Make You A Millionaire | Sara’s List 2024

alright today is everybody's favorite episode it is the sarah's list episode so we're talking about ten companies that you can become wealthy with without having started it or invested in it or joined early i feel like got rude where i know i could be what i want to from at all in in like a days off on a road less travel seriously and i get a little presentation for you if you're on audio get over to youtube right now because i have slides that are gonna be fun so it's called sarah list this is sam's wife sarah she has hilarious she's is on the cover of my first million and the reason why is because she has an unlikely story a story that i hadn't really heard and when i heard it for the first time it kinda shocked me which is i think when i heard this she it was about thirty years old at the time she was a self made millionaire but she didn't start a company she wasn't you know killing herself working a hundred hours a week like we were she wasn't paying herself scraps she was getting paid a nice salary with nice benefits she worked at a great company that had good culture she didn't have to make risky angel investments and get lucky she was not a high profile exec that just got you know some huge pay package and she wasn't lucky like the facebook graffiti guy that just got a bunch stock from from facebook and you know made seventy million dollars and so her story was almost incredibly boring it was incredibly simple and i just couldn't believe it i was like i'm trying so hard to make make a million bucks here that was such a better path and so just to recap you know self made millionaire didn't start didn't have to start because didn't have to do risk gains angel vest did wasn't a high profile exec wasn't the graffiti guy what she did what she joined airbnb and so if you look at this chart this is b's valuation over time and there was a period when airbnb started that was the high risk period that's the flat part of this curve and to join airbnb b then you had to see something that was not obvious you had to believe something that would that took a huge leap of faith you had to work like crazy in a tiny apartment there's a fun video by the way of them taking like midday dance breaks where they just played a bunch of everyone stands up for the desk there's dancing you had to do weird startup up stuff there's a guy with stinky feet probably that's not even what we're talking about right she joined after it had crossed you know a ten even right sam twenty billion dollar valuation yeah and if i remember like they already had that huge office remember that huge office at eight to eight brandon and yeah i imagine there was like a thousand people plus working there like it wasn't small and you and i were living in tiff francisco the time and it was stupidly obvious like you could've have slapped me in the face and then i said what's a company that's a winner and i would be like airbnb b's is a company that's a winner it was like obvious at the time i had friends at uber same thing where was obviously a winner at the time where they were already multi dollar companies but because of the space that they were in and how dominant they were it was clear that they still had room to run and what we call ce list is basically a a function of using your time as your investment most people don't think of their job as an investment decision but your time your talent where you're gonna spend four years working is a investment decision you should be thinking about it like a venture capitalist and especially if you're working in the scene and so these are all venture you know venture backed tech companies that we're talking about so the criteria for sarah's list it's a company that has product market fit it's just a clear obvious successful company doesn't mean it can't fail but it just means it has it's not in the scrappy figure it out phase and and and you know wandering phase of startups it's funded it's growing and you'd get a nice salary and benefits they got oat milk in the fridge and that if you joined and you got a two hundred thousand dollar stock package so that's like you know getting fifty grand a year of stocks maybe you maybe you got a hundred fifty thousand salary and fifty thousand of stock that could become worth a million plus in the in five years so can it five x in five years we're not looking for max upside we're looking for low ish downside and enough upside where you can turn you know a two hundred thousand dollar stock package into you know one two three million dollars would be that would be the outcomes that we're looking for so we did this once in twenty twenty one three years ago and before we tell you what we picked and how we did we got a time travel back real quick so let's do this fast so back in twenty twenty one this n t sold for sixty nine million those are the good old days tom brady was a football player sb spf was a hero people cared about it whoever these people are it was a simpler time and the stock market was running up it was on a ten plus year bull run it had its peak in twenty twenty one for the listener people cared about quote these people these people was prince harry and his wife who yes i even know who it is point my proven thank you i rest my case by the way did you know this sesame street and seven eleven launched vc funds during this time and so they had their own venture funds everybody was getting in on the game but nothing lasts forever and so since then just to give you some data here so since then about thirty six percent of startups who have raised money since then have raised at a lower valuation does not count the companies that died or the companies that are avoiding raising because they don't wanna raise down this is like transactions that cleared one third of them are clearing at a lower price of all startups it's even worse if you look at late stage start so later stage starts which are the ones we're talking about series c series d they're down between thirty and sixty percent on average that's the that's the that's what you're saying across the board sad news two thirds of employees right now that are working at these companies are working for options that are actually worth zero and they probably don't even realize it yet meaning they got a pay package of stock options at a twenty four dollar strike strike price that stock is currently trading in secondary for eight dollars so all of their shares are underwater we're currently only thirty three percent of the shares are in the money as they say alright so what do we pick we picked about eleven companies i think we shared one company but we had each picked around here here's what we did so it's not great all the stuff i just told you is basically our big fat excuses as to why it wasn't great we both had two hits so two things that did that did go up in and sort of step change way you know sort of three four x so far in the three years i had two that were down like valuation lower than it was previously you had three that were down and then there were some pushes and a push basically is like has the same valuation as i had before but that's actually sort of a win because you beat the market so you didn't achieve the ce stream but you didn't take the huge right down that a bunch of you're wrong about next health next health is wrong next health is wrong on here but is it actually well the word neck there's two companies one is neck one is next so i think you you there was a little confusing but that someone in the research departments getting fired here no they're just they're just missing a tea open store and while so open store is down it's un it's unclear but i market is down and it's a little intellectual honesty i don't think i don't believe that it is achieved it's it's it's a it's status to be called up it i we have it as a tb i gave it a a less generous interpretation of of down just make my own grading harsh this not about them it's about me grading my own picks more more so and do you think fig was down to well fig tried to not down it's a push here it tried to sell for twenty billion didn't clear that the transaction didn't go through so that would have been a in a a two x but then the last i believe round of funding and this by way this is not all very obvious so companies don't know was announced to valuations there's leaked valuations to the media which are not always always true there's valuations that come with a bunch of strings attached so maybe you gotta a good number but there's all these caveats and liquidation preferences and a lot of this was we ask people who own secondary stock marketplaces we said hey what is this company trading at right now and so it's incomplete information right doing the best we can here with private stock information that you don't you don't always have by the way sarah my wife this is about had a job offer at fig like three months before their acquisition offer which like it had that gone through i it i believe it would have been a two x return based off the valuation so we almost we almost had a mini hit again but not quite yes exactly alright let's get to the twenty twenty four picks we're gonna try to do better now the the good news the the pick any picks you made anything in the vintage of twenty twenty one like i said earlier the the all the companies basically got select everything got re under rewritten everything got got corrected but now where we're at i think we are at a a a less hype period of time and so this cohort of picks i think should be better but again not financial advice really meet neither me nor sam actually are trying to go get jobs this is kind of like what we would do if we were going to get a job sam did this with sarah when she was looking for jobs so this is for fun well let's just put that out there we're not giving financial advice here i have like five or six but then i got a bunch of other ones that were like it's like scrapped like i didn't quite get to what do you think is the let's say we each bring five at the table i bet you there's gonna be at least three that we are overlapping on what do you think yeah two i'm been guessing two overlaps and by the way i'll say i think a good hit rate on this good hit rate would be six out of ten six out of ten have a a step up where five years later we're not even five years after the the twenty twenty one ones yet we're only three years in but five years later that they're sort of like a four or five x valuation if six out of ten did that i think that would be a a great thing i think three out of ten would be sort of the lowest bar that i would accept alright well you wanna go first alright i'm gonna go first i'll start with an obvious one it's probably one that you have to open ai and by the way there are no bonus points for difficulty in business the fact that everybody knows open ai i'm not trying to give you a secret company a secret stock tip you've never heard of the point of this often is that the companies that are gonna be big juggernaut are hidden in plain sight so open ai currently valued at a hundred and three billion it's doing about three and a half billion a year in revenue already the bull case so what do you need to believe if you're gonna join this company that you did you think it's a sales contender it's the first credible google competitor in about twenty years it is something that actually could displace replace search which is like you know when people need an answer to something or they need help with something where did they go it's the fastest growing company ever that's nice so i took them you know two or three months to reach a hundred million users it's five times faster growing than the next fastest product ever it reached three billion in revenue in the last you know it's in like three years it's pretty crazy and it's unique because it's a enterprise company it's a consumer company and it's a dev tools company at the same time i think that's pretty pretty unique and gives it a lot of upside what you would be worried about if you're were looking at open is it's probably the most competitive market on earth right now you're getting competition from every the the most well funded start of the most brilliant people as well as the biggest tech companies the world facebook google amazon everybody is coming after this market so that's the downside is will open retain their lead or not yeah yeah the the problem with open it can you get a job at open ai not only is it the most competitive like not only is it the most like competitive space like i imagine they have to have one of the more competitive like job applicant pools dude i read some crazy stat that tesla has something like fifty thousand people a day applying to work there and i have to imagine that open it's somewhat similar where they are just like inundated with applications well yeah i mean but we're talking our listeners the cream of the the cream of the crop here this is the creme la cr so yeah of course they get a job wherever they want so would we'll open ai five x the current valuation yeah i mean yeah yeah that that yep i agree with you alright you want me to do one mh alright i have got one called re tool you know what re tool is i have no re tool i use re tool and i wish that i invest in a retail i tried to invest in re tool early on and i missed it i'm not a user of it so it actually would be best as a user explain what it is so every technology company has the same situation that they would all homebrew brew a solution for and the situation is you need a back end admin panel so you have this i'm sure with hampton where yeah oh we need to add or remove a member or hey this person changed companies they're asking if we can update their their thing or hey can we change their membership status for an active to suspended or whatever whenever some admin function that you need to do and it doesn't come out of the box with whatever you know you're using ten tools to run your business but like this is the what's the tool for your business and a re tool is a simple way to make the admin you know panel for admin system for your for your company where anybody in the company who's not a developer can actually go in and you know add remove you know make changes to essentially the database that's like the simplistic way of saying it it's basically a back end tool for any business that you customize and your developers can build once so that anybody in the the team can use so it's a internal tool and here's this crazy stat so the founder his name's david david david david's a baby genius so dave has david started this when he was like at the university of cambridge when he was like twenty one years old and he's like he's got one of these like stories where he basically before this business he had a a payments app that i think did okay but whatever he quit working on like when do you see like a nineteen year old kid do you're like okay you this and have a payments app at nineteen you you want yeah and you're going to one of the best universities on earth like alright something is interesting here he gets into yc comes up with this idea and here's this crazy set fifty or sixty percent like fifty between fifty and sixty percent of all software in the world is internal facing tools meaning employees who use internal facing tools that's a one chart business right that's a one chart business and not a lot of people focus on that because you kinda focus on things that you see and use versus things on the back end that you maybe you kinda get you don't really touch that often but the business has crushed it and so they launched in two thousand seventeen their latest valuation is three point seven they've raised a hundred fifty million dollars from su sequoia and a bunch of other great companies listen to this growth first nine months five hundred thousand dollars from revenue in two thousand eighteen they hit two million in arr in two thousand twenty four they hit around a hundred million in recurring revenue so it's gotta be one of the faster growing businesses out there and i've been watching interviews with the sky david the founder dude he's amazing he's a he's an amazing company so at evaluation of three point seven i think there's room to run i think there's a five or ten x potential here i mean that's gonna be a they're gonna be be a huge business but the market is just massive and i like the guy i think that's something we're gonna see a bunch of these which is that the ceos seem to be remarkable in all these businesses and that's just if you're gonna make a bet on a private company you wanna be at one with like one of these all star ceos my retail story i two two lessons learned here one invest in your p and l so i had this problem we oh we were always trying to build these things internally the devs never wanted to work on it enough because it's an internal tool so who cares and when we got re tools like this is great this is no brainer and so i the first lesson i always was i i always remind myself is the best place to invest is in your p and l meaning look at your expenses and go figure out which of those companies you think other people like you you wouldn't wanna cancel and other people are gonna have is their expense to go invest in that company roof tools is one of those and then second thing was once we got acquired by twitch years later so the first one is probably twenty seventeen twenty eighteen the second one was twenty twenty or twenty nineteen i'm at twitch and emmett who was a yc partner was like i was at a meeting or he coming to a meeting with me and he was running a little late and he's like oh sorry i was doing an office hours with this yc company that just had they just hit this point it's he's like there's this thing that happens where you go through yc it's all good then you have after yc where you know you're just like you're back to being like a normal struggling company he's like and then sometimes you hit this inflection point and shit just really starts to work he goes yeah this company re tool this really starting to work when you're you know when a really smart friend tells you that something is hitting an inflection point like drop everything and go go go hunt that down i remember the time thinking i sure invest i saw the guy david in the cafeteria because he had just met with them him and wearing his re tool shirt and i went up to him and i was like nice sure love re tool and then that was it that was my i all i needed is that like guy i he invest he's young i think he i think it was like a college kid almost yeah it looked like you just could have been any employee at the at the company he was wearing his own trip anyways so re rachel i like the pick valuation is high so i think four five x is tough from there right to become a fifteen billion dollar company is tough but i think it's a good really good company alright let me give you my next one the next one mercury you're nodding do you have this one it was on my i had it on my a list and then i removed it because i thought you were gonna pick them i i did pick mercury so mercury is a company that i use so i'm a again look at look at the tools you use that you don't wanna change so i use mercury for i think that one too but like six of my companies now it's just a amazing product so the valuation is still in that sweet spot range where it's what i think it's one point six billion right now so the valuation is is there here's the bull case here's what you need to believe it has a rare combination on what what mercury is just a bank that is built for small businesses and it's easier and simpler to use it's basically just a normal bank just easier and better if you're a startup and you need to have a bank account every startup does you can use a bank from like you know bank of america or whatever like a you know some some traditional bank where you're gonna use their product and it's gonna feel like you know a bunch of fifty year olds hired some webs shop to you know outsource this tool that they needed like the second like second second class citizen whereas mercury is like oh a founder made this i get it it it solves all of the founders all of the problems that a founder would have i get it and it's true i mod was a founder of multiple startups ups before he made this and now it's like the best product for startups so product's is amazing it has a rare combo it's growing fast and it's profitable which is great because a lot of the companies that get written down or or the risk comes from they're not profitable they're burning so much cash that if the growth ever slows all of a sudden you get this huge discount in the valuation so the fact that this is profitable means there's a margin of safety here silicon valley bank used to be the bank of of choice for silicon valley startups it imp it was a thirty four billion dollar company with seven billion in revenue two years ago and it imp because they manage risk nobody has really replaced them i think mercury is the best position to replace them so if you think about like what's the shoes they could fill they could fill the sv shoes that is a thirty plus billion dollar company they're the category leader i saw this great quote from su sequoia partner he said the category leader in any category tends to get something like seventy five percent of the revenue and fifty percent of all profits that are gonna be in a in a market which i i don't know if those numbers are exactly right but it's directional correct which is that the winners of every category take this lion's share of the rewards and i think they have a good moat i think they have a great brand it's letting them get customers you know for free and regulatory moat as well which is this is not a simple thing that any you know any person could go start there's a lot of obviously like financial compliance and regulation now one thing to caveat we called them a bank that's because to the customer feels like a bank technically they're not a bank who do they who do they use so they use like choice bank i think and evolve bank on underneath so they're what we we call like a neo bank you know just like a finance platform basically and the bear case the other thing that you know the worry would be can they grow with their startup so some products are great because you get them while they're young and you grow with them and other products you get them while they're young and then they graduate off you and as soon as they become really valuable customers they take their business elsewhere i think they're gonna be able to grow with startups but that would be the risk here i didn't find honestly much of a bear case do you don't know if you have yeah i've got a bear case i think i i i almost always bay banquet with chase because i've just always been afraid of can i access that my my money and it happened recently where a lot of people were using mercury as i mean not to shit on mercury they were using lots of different things and they couldn't get their payments out or their payroll out because of the bank the bank are working bank yeah and s and s b was one of them they're they're they're no longer a business because they're the huge company that mis mismanagement a stuff and it did work out and so yeah i think that's a massive bear case i think that the reason i bake with chase is because of chase go out of business and have the issue that s silicon valley bank had america would basically go under too big to fail yeah the way and i always knock on wood when i say that but a little bit like that where it's like you know i think chase is like i i don't have to look at the stats but it's something like five percent of like americans use it so it's like a a pretty big deal and so yeah i think that's a bearish case as to why i i don't think that's necessarily a bear case because first of all they have like i think five million dollar fdic insurance now like they offer for like twenty times more fdic protection than than they than they need to or than the average bank does so i think they've they've got some features that help with that but the other thing is like i think the proof is in the pudding which with this which is that if while it's understandable to say oh you know i i choose to go without too big to fail bank if you just look at kind of where the startups are voting with their feet this thing is growing so fast that obviously people are making that choice already so it's not like a future scenario it's like today that choice exists and people are making the choice to go to mercury so i don't see a reason why that would change later necessarily but usually when i think about america it's like what could go wrong in the future ways of what you're talking about which is maybe people just prefer to use a a traditional kind of hundred year old bank because of the track record they have that choice today and people are like choosing to do the other so you know think that's less of a bear case last weekend because i'm a client at chase they gave me box seats to the us open and it totally worked i'm gonna bake with chase for us as long as they'll have me so long as i get tickets to the us open it's as soon as mercury like starts doing these wild died perks they shit like i want i want a fucking fruit basket i wanna get basket if i don't give a gift basket you don't get my business i changed man i mean i'll take a twenty piece nuggets for chick like i i i'm not i'm simple man i don't need the us open is easy oh my god i they take me i i got these like a basic seats to the us open and it worked it worked look like it worked i get it i i fell for the trap and i and so but yeah no i think mercury is a great business i think the founder is pretty bad at so yeah that that one's good alright so you said that you were gonna look at like the founders and in or no sorry you said you're gonna use your p and l so where you spend some of your money i like that i also do like where do i spend some about my time and where do people spend some of their time and so a tool that i'm playing with it's called cursor and i think cursor is pretty amazing and so and i'm gonna tell you not my story but the reason i've been using it but there was this little girl she's eight years old her father's on twitter and her father's a developer i guess and her father tweeted something out saying i'm trying to teach my little girl how to code and we're using cursor and here's a facetime of her like a loom like a screen record of her learning how to code and within twelve minutes or something like that she's built a website and she used cursor so cursor is this really cool tool tool it's got a lot of hype right now it just kinda the easiest way to describe it is it's sort of like squarespace wick wix or any of these other website builders but it uses ai and you talk to it a little bit like a person and it makes it really easy to edit code now there's a bunch of pros and cons of this business the pro is i think it's amazing like i think that this tool is awesome i've been playing with it it's super good their latest valuation is four hundred million dollars i don't think that that's insane so that's like there's opportunity there i think that the con and this is a big con which is these website building tools do their pe multiples are shit so you look at like squarespace wix wee bleed do you remember all these like they don't trade that well so they can do billions i think you're pigeon only it has a website builder it's not a website builder it's a it's a ide you could code anything and you can code anything in it but it's still i think in that category in terms of you don't think it's in that category in terms of any like github c copilot rep category where it's a you where it's a coding environment where a programmer can become now an ai assisted programmer so however because you were however efficient were however productive you were as an engineer as a as a programmer you can now be you know some multiple more maybe it's one and a half x more more productive maybe it's ten x more productive as the ai improves and so i don't think because you know wick and we believe these are like you know my sister needs a website for her preschool so she goes to squarespace and makes a website she's not gonna she's not gonna go to well today she's not going to cursor for that and also those tools could never do what a cursor could do where it could build full applications you know yeah i feel you i feel you i still think that like alright so we use i use bubble you know bubble a bubbles like an app builder this is a little bit of a competitor to bubble and in my head as an investor and at potentially as a user i think it comes into like it uses it's like the same churn as a small bit or a a website builder where you spend ten dollars a month and there's not always a massive reason to stay on the platform versus all the other competitors like it's pretty easy just like up and try different ones do you know what i mean and so for that reason i think it's a little bit similar in the terms of in terms of evaluation right okay i have a i have i was i looked to cursor are very close in fact they were on my first draft of companies to be on here but then as i did more research i went with another company that you'll see at the end of so but what you think about cursor well for a four hundred fifty million dollar valuation do you think i think i mean i think you're getting high upside high downside there because you know that valuation not based on it's not based on revenue it's it's based on like you know this this vision of what the future light might look like and that's great and i think cursor is awesome right now if i could invest in cursor i would totally invest in cursor right now but i think it is more risky than some of the other ones we've talked about so far i think that's true they're at a ten million dollar run rate i believe or don't know if it was run rate or that's actually what they did in revenue but yeah it's tiny compared to the valuation what you have then instead what's your competitor to it oh i'll okay so it's my last one but i can't rearrange the slides here so you're gonna have to wait on that when did you told that story about that little girl i thought you were pulling a kamala harris and you were gonna say that little girl was me at the end and i was pretty ready for that emotional landing instead you're were like that was just somebody's daughter i just followed grown men's daughter on twitter i don't know i it was like are you getting your tape advice dude it was are you are you did you see that video i did not see that one but i've seen some kind of amazing things i cursor demos right now all the rage dude you what's all the rage alright keep going alright my next one i don't even know if you've heard of this company ep do you know this company no okay so i don't like that name ep yeah ep so this is a joe lo company it is a weapons company a defense company and i don't know enough about everest empress because it's a very secretive company and it's very private to tell you that this is the pic what i actually did is was i put this here as a placeholder as a general strategy so one thing i would do if i was interested in this kind of sales concept finding a company i can go join that the stock is gonna be my my stock package is gonna be appreciating you know rapidly i'll get a five x in five years i think that the way and hit for us last time there are now like ten more and type of companies that exist that are inspired by andrew that are worth checking out and itself might still be a contender by the way but there are more companies so everest is basically like long range you know like defense weapon or whatever dude if you go to their website it's everest inc it basically looks like some type of like electromagnetic thing that shoots like radio waves into the sky and brings down drones and plug exactly what it does it's pulse that will take down you know a drone or a missile or something like that without being a bomb like you don't have to like you don't to bomb something you could just disable it it's just magic there's a great story by the way david this because this looks magical like when i see like an invisible race it's such a good pickup line i'm gonna use that next time i wanna try to like talk to founder her be like but are you related to david blake because this is magical you see it doesn't it it does look like magic so he told the story where he's like i was like dude how do you sell to these like three letter agencies and he's like it's very hard you know there's like decades long relationships and with the the traditional companies so like how do you do it goes well the the big thing we always try to do is get to a bake off he's like we have to get to a point where they're willing to do a contest of our product versus their product because we can win on product we have better product and engineering but we don't have better you know good old boy relationships here so we have to get to a bake off he's like so we did a bake up for ep and basically everybody went to this field and they're like cool i'll line up and then you're gonna go first and we're gonna see how far away you can you know disable this and how effectively you can disable this drone that was the test and they lined up and he's like handing out bin and they're like what was this he's like you're gonna need these to see how far away we're gonna be able to disable this thing and then they're like won the bake off won the contract and all this stuff so i don't know about this company specifically don't know enough but i would go interview at the top ten like defense slash weapons companies go talk to all of them and then user your judgment on which of them is the winner i know in that basket there's definitely one or multiple winners that are that are in this i but i from the outside of do you even get that person so let's say you're joe lo sale which like i guess that's kinda this answers the question because he's a big shot but if you're not a big shot and you wanna get like some cia buyer into a field in texas so like show like to to wow him like who do you even phone call you know what i mean like who well i i think there's a multiple answers to this but i'll just give you a couple of data so the the very first thing is that there are bids there are like rfp p's that you can participate in there are there are like you know the government has a process a procurement where they need to be able to go solicit proposal so you can go look at those you go talk to those the second thing is when we were at his house after we recorded the podcast with joe we were walking out and there was like ten like senators there for lunch and i was like oh this is how you build your network you you he's like hosting a lunch for like ten he like bring you all the competition door like a like literally because you elon is coming over and he was like hey it might be easier for you if you just wanna go this way we were like easier for you or for easier for me like maybe for both of us alright good fair fair enough because i'm literally in my basketball surely did he hand or bucks yeah like here too that bought you over and bought you uber like don't forget your lunch lunchbox that i like wandered off to a bus yeah yeah was there apple juice wedding free your the doorway way out it truly how it felt and by the way couldn't have been happier with the arrangement i did not wanna be a fish out of water year so i think that's one way there's also a great story told on the bottom about like how peter t was telling them like dude because when they started pal here he was like a couple years out of college like it wasn't that old yet and he had like a lot of like kinda like the pride and hub of like like a tech kind of like genius type of person and he is you know a genius type of tip genius level person but going in and saying you guys are dom wi smart is not the answer either to sell to these and so they hired this guy alex carr who's still the ceo a pal and one of the reasons why i was like this guy was just like very very good with relationship building with networking with being accepted by these buyers and then he recruited like ex government people to be like door openers opener like warm handshakes to help them get in the room and i didn't think that that's how they got i wanna do a an entire podcast next time just on the new times article on alex car very funny very good very interesting yeah they're very good alright i buy into that i it's a to me working at everest or any of these national or these defense businesses it's sort like working at a porn company where like you like probably most of the work might be like your mom be work video entertainment well yeah like most of the work is like normal like just a normal job it's boring but then like you see the output and it's like fuck like death or destruction or like like pretty like ro shit if you're working there their tool this tool just in this case is like a non death tool it's disabling the know i without bombing anything but yeah yeah like some of the other ones are are are a lot more like yeah this is war yeah we're like the output of this whether it's right or wrong it's still like a you it's you go to bed everyone's wrong i imagine with the heavy heart even if you're doing everything right alright i haven't i have another one and i am you know that what does that call the mid wit meme where there's people who are on like this the dumb guys are at the far end where they just don't think things or how does it go you're on one them let's just put it that way you're showing that you got one of those sides nailed there's the big the kind of the beginning of the caveman you know build product talk to customers right and then the jedi is also like you know i just build a good product talk to customers and then the guy in the middle is doing like over analysis overthinking override but i feel you you did a good job like you know like like a mime you like acted out the meme that was great i am what i am i took that approach with a couple of these dude have you heard this company called the wiz i've heard of was i don't know what wiz does i looked at it and i was like i don't understand this enough dude alright so check this out so it was wiz is a cyber cybersecurity company for enterprise company so or enterprise customer so basically if you have if you're using like large cloud tools it the tool whiz this tool like scans it and be like alright you have a potential threat here here and here for cybersecurity issues it's the fastest company ever to get to a hundred million in annual revenue took come up eighteen months the guy who started it now this is why where like the mid that meme comes to the play here because he's kind of amazing i read this article about him a couple years ago and the opening line is i guess he his his first name is soft so he's israeli and he was like a israeli defense guy in the military and it said don't mistake a soft gentleness for someone who's willing to play by the rules that was the opening line i was like okay was that even me yeah it's like a tender bio jesus yeah alright i'm interested and so basically this guy he previously had another company that he scaled and sold to microsoft it was also a cybersecurity cloud companies he sold microsoft for a billion dollars he gets sued his his warm up company yeah his warm up company he's only thirty eight years old he gets through his non computer ever spends time that microsoft things go well and then he starts his next company called wiz so far they've already raised two billion dollars of which a one billion of that came in one round and the company's is only eighteen months old which is absolutely ridiculous they've done something i think they're already at three hundred and fifty million dollars in revenue in just three years three and fifty annual or recurring revenue in three years something like eighty percent of the fortune one hundred companies are already using the tool so they've killed it already now here's where things get interesting their last valuation was twelve billion dollars but there was a rumor that google was gonna buy them for twenty three billion dollars and so there's all these rumors that this was happening and so he sent an email to the entire company and let me read you a quote he goes the first line let me cut to the chase our next milestones are a billion dollars in arr and an ipo and he explains how they aren't accepting this offer from google because they wanna like make it big and be this huge thing and i love this guy i think he is just one of the coolest like in most interesting ceos out there right now what do you looking at what do you think would you look at him well he looks not like what i thought actually your first line about like don't let my gentle whatever fool you like i'm here to whatever hank feet the bed i don't know what he said but like something like that that's what i heard he's he just looks like a i good it looks like a midwest nice guy and when i look at these photos i was really expecting a a a lot more hard looking at a guy which is just from my google search dude when you see a guy wearing a t shirt who sells to like suits or the nsa or whatever like these like big big shots i think that like you're secretly very dangerous like the yeah you know what i mean since let me tell you something here so okay so check this out there's a part of the wisdom story that i think is it's pretty interesting first of all interesting pick i think they have such a high valuation that you're really betting this is like one of the mega cap tech companies to do this okay fair enough the the thing that scares me is anything that grows this fast you know what goes up must come down at the way it's is not it's not as lin it's not as you know where something is a slow compound you actually trust it more than a explosive but not like doesn't have a long track record dude but that's the goal of this thing it's things that could five x in three years that's fast five years five years yes whatever yeah true true but i guess what i'm saying is like i it might be priced i don't know so let me tell you something that's interesting about so when i saw this company growing so fast it's a natural question of well how have you heard about the story about this guy named gill that's associated associated with wiz no but i'm in alright so who is gill i don't even know how he say says last name run on run on something like that gill ran on let's call them dude is it all these guys by the way they're israeli like special force guys yeah so this guy's ex israeli military intelligence yes he also invented cap he invented w which is web application firewalls he did a bunch of other stuff in security he was a partner at sequoia very well respected in the cybersecurity world and he started a vc firm called cyber starts and they're the first investor in wiz i'm now check this out so let me just read you this excerpt the numbers for the for the vc fund cyber stats are phenomenal the fund that specialized cybersecurity funded by gil only six years ago here's here's how it goes so twenty two companies combined value thirty five billion five of the twenty two are unicorn so a higher hit rate than yc first and foremost is wiz who's breaking all the records four of them were sold in the last twelve months so you know like successful exits for a total amount of one point five billion and the last three months their companies have raised one point eight billion blah blah his his portfolio shows at irr of more than a hundred percent which is you know unusual for even the best performing funds not a single company has failed so far in his portfolio and it is currently ranked in the top five all vc funds in the world due to these achievements okay so then you say well hold on what is what's working what's what's actually happening here and then you say then there's something called the gil run on model and basically what he does is he's got this mafia of the chief the cis so the the chief security officers at all these enterprise companies and they're all in his pocket they all respect him they think he's got the midas touch he's done so much in the space he builds a relationship with them but then he makes them essentially partners like i think like carry partners in his fun and so what he does is he basically has this like a bribery network is what my understanding this is not what they called you but like awesome corruption is awesome it's causing so it is referred to as the gill running on model it is causing more i gotta stop saying this guy's last name come probably put your in cause more discomfort amongst israeli competitors and portfolio companies which are all jealous for obvious reasons it has reached the us where company executives who are purchasing cybersecurity systems are as committed to gill as they are to their own company and basically what he does is he goes to them and he you know winds and dine them with dinners and conferences but according to several sources he promises teams of fresh gadgets graduates from tech units not only investment support in the start but initial revenues of two million a year this is usually their first year of revenue which is intended to boost them above their competitors and help them get the next round of funding and the way he does that is by using his network of loyal loyal cis and so the first sales come from the loyal cis who work with the fund it might be considered small money but the jumps in the the jumps and fundraising for security is is difficult if you can get to that two to ten million range you've like you have escape velocity to get to the next round of funding and all that he creates a mechanism that is def fit difficult to compete with because the companies immediately jumped to evaluation of a hundred to two hundred million raise more money and have more resources to compete later the seemingly small purchase of a hundred to two hundred thousand dollars by the cis will increase the star's value dozens of times this is known as the gill model and i think what he says there's something here about like the kickback that they get so there's some here's what he emailed them it is difficult to predict the performance of the fund but according to our forecast the points you have accumulated in the funds so far are valued at x dollars you can expect additional allocations in the coming years and in the new funds we will raise later so it's kind of a you scratch my back i'll scratch yours model i pick winners i just thought the guy was awesome because he wrote cool emails and he's got dope smile turns out you know there's reasonable wolf backing him yeah well a lot of them are from i think it's called the unit eighty two hundred or something like that it's like the nsa of israel and so if you look at like some of the largest security companies so it's like i don't wanna talk totally of a turn here but i think it's like palo alto networks and it's always like multi billion dollar companies they all came from that unit and so i it turns out with this guys it's more of a they're they're they're definitely working together but i thought they were just working together because they were all from like the same crew you know it's like they all went to high school together turns out clear there's like one oath i you nor i know jack about this but it sounds like a movie and we're pretty fascinated that's i think that's what's happening here so it sounds like emotions relationship alright my a big dummy like me came to the great conclusion as this fucking smart juice yeah alright what do you got alright my next one is a quick one neuro link so neuro link is currently valued at five billion dollars scott like pretty much no revenue here's the case elon they put it chip in a guy's head and he's like playing video games on a twitch stream now it's pretty crazy the first patient they have a huge technical milestone well he paralyzed or he had ms yeah he's a quad you know so he can't i think he can't move his his arms or his legs i believe and now with his brain he's just playing chess and use he basically he can use a computer with his brain now just by thing look at and he's like my life just got so much better this is amazing and a successfully implanted the chip in the guy's brain and he can now use some computers it is incredible i cannot believe more people are not talking about this i'm gonna do a whole deep dive on ne like just because i think that i'm blown away by the videos i've seen and the the the nerdy rabbit holes i've been down for it to me this is a question of when not if meaning the next platform shift is probably glasses but the one after that or the you know the big one is just put the computer in the brain that will happen it's just maybe it's ten years maybe it's a hundred years i have no idea the other bull cases is look even if this doesn't five x in five years you're gonna be helping a lot of people out because all their initial customers are people who are you know severely disabled can't see and they're gonna make them see they can't hear they're gonna make them here they can't move their arms they're gonna make them be able to use computers it's it's really incredible so i think they're doing incredible work and that you're probably working with really smart people on a mission that matters and you're probably gonna make a lot of money to do it the bear case of course revenue question more question you know they have like one customer right now so like it's gonna take time long path to success they're kind of at the they made the first tesla roadster that's where they're at in the the tesla journey right now dude but you're missing the whole point of this list which is like how do you like not like stress out all the time and like things like that and have a good job these companies need the they need the personality higher they need the guys who's bringing smoothies to the office they need the guys a good time to be around they need the guys willing to do the dirty work and go clean up the files and go organized do you think that elon has a personality hired yeah i think he does dude i think he's got like literally like meme lords that work for him say i think he's don't got personality i don't know man i agree with you on so many things i know some dummies that work at tesla let me put it that way i i have some like who's this my cousin works at tesla that you meet the cousin it's like does he work like in the tire shop like who's this guy yeah i feel that but ne lengths not that how many employees you think they have i have no idea i guess like probably like a hundred is my guess or somewhere like in plus or minus fifty i've bet no clue two small todd you're assuming i didn't say sarah's list is the chill life it's it's not the vested rest invest life i i think maybe we have a misunderstanding maybe sarah wasn't doing as much work as i thought no it's like a forty hour workweek week i i don't know if ne link is a forty hour workweek week if it is then i'm on board okay fair enough fair enough alright i'll do i've got two more maybe alright you had open ai now i wanna i wanna vote with my attention a little bit i use open ai every day but you know what else also i use a ton is per complexity do you use that too me too yeah i use per complexity as well now how do i explain the difference between the two i think per complexity is when you need the answer to be right yeah chat gp is when you have a variety of random things in when you wanna as important yeah if i'm doing research for this pod and i need to say a number that's not gonna be be wrong per complexity is a better bet than chat gp so per publicity i think their latest valuation was three billion dollars they raised four hundred and fifteen million bucks so it's already like very big but i think the market's huge i also think when i i find like interesting stories about the founders and i love it so what's the ceo of per complexity i know how you spell it ar i think is his name ar alright so there's a funny story about ar he grew up in the same area as the google ceo and he grew up vegetarian and his mom went let him eat eggs the the complexity ceo and he like grew up and like no you can't have eggs and he's like i need more protein she's like he can't have eggs so he sees a youtube video of a sun from google saying yeah i just introduced eggs to my diet in order to like get more protein and then the mother's like okay you may have eggs and so the fact that and he goes on worry don't going story he he goes on why dude listen he goes on to like have this story where like they're like dude s and my household was like god where it was like well if he does this and you must do this right it's so imagine being raised in such a toxic environment where you are either him or you are a failure and so far is doing pretty good so like that's again that's like sam being a dummy and voting on a company just because the the apartment magic the the founder is trying to like prove his mother you know make his mother proud that's a strong that's a strong motivation it's no but i do think the the company is going to get significantly large like the episode of like always sunny where charlie trying to date and they're like charlie what about her she's great she's got a good job she's nice she's he's like she doesn't like milk it's like what charlie he's like know she's like us daughter and it's take you to stacy like what are what is your criteria charlie what are you doing here is this a ridiculous pick or what no i don't i think a lot of people would say per complexity so i i don't think your your logic i think it's ridiculous i think you're yeah you somehow landing at the same conclusions as the geniuses but the way you get there is unique and i would say no i i i picked it because i use it i i've like it in terms of getting in terms valuation right now three three billion bucks so a lot but i mean i don't know it it's like a a fast also seems like a company that could get bought so like you know open ai chat is like aligned with microsoft and google's trying to do gemini and all the stuff but like if complexity keeps executing you know it's the way that facebook bought whatsapp at for twenty billion right like at a certain point if you are a better version of their core product of one of these large companies google being the kind of the main one you know you're a a very good acquisition target even if you're standalone alone business may it may or may not reach there i have no idea but like it gives you multiple outs the downside is like it seems like no tech company could do big m and a anymore so maybe that path is not as realistic but i i don't think it's a bad pick i think complexity an interesting pick do you wanna do your your other one and then i have one last one let my last one is trauma have you heard about trauma i've heard a lot about travel because there's like a t there's like a trauma p mafia that's out there and it's am not alright so let me start i don't i'm not part of that mafia because i do not wanna work there i think it sounds miserable but there's a bunch of freaks who do wanna work there and if you are one of these freaks this is a a place to let your freak fly fly i'm not a fan of and like could you explain that so i think it's kind of like here's a simple explanation of the culture most tech technologies are like we value diversity and balance and we want you know well rounded people and trump was like y we're doing china in america they're like you we're we're working like the chinese over here like we're doing the nine ninety six model here to create a trillion dollar company we are gonna just like compete ruthless to get there and that's pretty awesome let let me explain what it is and then we're and then i i i have some of their i have a little bit from their deck on when the onboard employees but basically trauma is software i guess you would you it's not just software you want to categorize as just software it's it's a little bit of everything but it's a it's software and a way to get part time or fast workers when you are a manufacturer or or a big company like that staffing industrial staffing yeah so it's software plus like actually getting the people to show up to if you're a big factory if you're something where you need you know a hundred new employees or something like in in a week to do x y and z they make it really easy to find and get those people to actually show up on time i think they're trauma dot com their website i think it like that's their tagline which is get workers to show up on time tomorrow or something like that try it dot work yeah try dot works sorry now here's the part where they're they're kind of interesting so founders fun who i do respect they're like this is probably our highest potential start up and they've said that these crazy stories like they've showed up at the office at ten pm and what we've noticed is like the office is still buzzing with people and it feels like the golden days of paypal and they have these values these values are dream big have an olympic olympia work ethic which is inspired by chinese china's nine nine six mentality which i'll talk about have a growth mindset and be customer obsessed and so basically they say dream big we want you to be the number one percent in terms of ambition plus the number one percent of attitude which is gonna allow us to get the number one percent outcome we want you to have an olympia work at work ethic and they basically i think they explicitly said this on their website we have a nine nine six culture which means working nine am to nine pm six days a week and there's like these interviews with these employees that are like i really wanted that type of work culture and i googled where can i find that and you guys had it on your website so that's why i just decided to apply and work there and so they're pretty fucking insane born every day then it's like i googled where i can work the most hours and found you guys yeah they're pretty insane i think they only have like a hundred and fifty employees i think the valuation is something like a hundred and fifty million dollars i think no it's gotta be higher than that i i i don't i i i only saw a handful of numbers on their valuation is it higher than that maybe i'm wrong maybe maybe it is the valuation isn't public i think i was trying to like triangulate a bunch of old articles and i don't know if there's a current one out there so i can't say exactly what it does just yeah all i'm seeing is the founders fund twenty two million all around with she it would probably be more like what you're talking about so it could be worth more i don't have the information i just been doing a bunch of guess work out of just articles that we're live but people say that it's growing like five x per a year which is like huge and a lot of smart people who even though i think their douche bags like keith boy they're behind the company and they're definitely smart yeah okay alright i like i like the pick here i didn't realize their valuation was what it is looks like it's around two hundred million yeah yeah i think this is a bet on people right so i think the people behind this company are pretty remarkable they do seem like the olympia of founders now the market opportunity is difficult here because there's a lot of companies that get valued as tech companies that are actually something else we work was valued tech as a tech company but it's actually a real estate company there's e commerce companies where they're you know d companies where they were valued like they were tech startups but they were actually you know selling suitcases and shoes and things like that and eventually those corrections do common so i think the question here is like is this a tech is it a tech company or is it a staffing company that uses tech and started by tech people and you know i'm not in the weeds enough to know but i do know what you said which is that they seem to have a very unique culture it seems like very smart people are very bullish on them and it seems like the founders are in that elite elite level of both ambition and drive and that's those are good things to bet on in general but you did definitely just hyper critically tell me that like two of my were were too too hard to work at and then you picked like literally the one that's like y our thing is that we're the hardest to work at yeah alright yeah alright what are you yeah alright my top pick my finale drum i i want a drum roll because it's gonna seem because it's the same company i picked last time that is not that was not a winner in the last one meaning it didn't five replica one it's replica oh man i think i am more bullish on rep than any any tech company right now are you so bullish on it that if you could bet all the money that you have into that company you would do it no i'm not foolish but i would i did invest in the company and i then on top of my fund investment i wrote a personal check on top of that probably the only one i've done that with so you know my actions do line up with this but it wouldn't bet all of my money on this because i don't need to do that so here's here's my case so three years ago when we did this episode rep was at a about a one billion dollar evaluation it had five million developers at the time it really had no like ai story or tailwind and revenue was small to nonexistent what was done they don't announce they don't say but it's because it's it wasn't it wasn't a priority and it wasn't meaningful so now everything has changed except for the price so the five million developers has become twenty million developers no ai tailwind has become a huge ai tailwind and small revenue has become scaling revenue omni object came out and said twenty twenty four is are basically like has been our commercial year like revenue is scaling rapidly dude what to do okay so what does rep by the way hey here's the do you know the rep story it's kind of amazing to be honest so the rep story is i'm judd grew up in jordan which is a place i've never been and it's sort of this like you know the world is very large and there's people there's talent everywhere but the opportunity is not as evenly distributed and so he used to code he used to love programming but he didn't have his own computer at first and so he would go to internet cafes basically borrow a computer and he would who code dude learn to code but the problem with that was that every time you go to an cafe you're going to a different computer and you're not like none of your stuff is saved from last time and and if you ever learned to code like one of the first things you do is you first have to like set up your environment and so you need like your ide id you need to install all the packages for the language that you're gonna be using if it's python on and to install those files on your computer for it to work and you need to save those somewhere you need to host it somewhere there's all these things that go into coding and so he had this unique problem which was he wanted to code and he was so distant franchise where he didn't have his own computer that he was doing at internet cafes for a while and then even after that you know he worked at yahoo briefly like once he you know kinda graduated and he was still just sort of always annoyed with this like this like friction that it takes to get set up and so he as a side project created this thing that was it was called something that was rep something at the time and rebels this like programming term but basically what he wanted to do was he's like can i make a cloud cloud based programming environment basically like my environment but instead of it being local to my computer have it be in the cloud he it's because he saw google docs he's like oh my god google docs is amazing this is instead of having to have microsoft office but have the software in my computer have the file on my computer can just go to any computer anywhere go to a doc the whole editor is built into the website which is amazing i didn't even realize that it websites could do this and wow multiple people can like edit the same google doc at the same time this is incredible can i do that for coding so that's where he started and so and so he built it as a side project for many years so he worked at yahoo was a side project then he worked at facebook and it was a side project he worked with the guy at facebook on the team that the team and the the guy who created react which is like now like you know the huge programming framework react and somewhere along the way like rep rep basically starts to get a little momentum it's like a hundred thousand users as is like side project and it was he worked at code academy and code academy was teaching people to code online and they discovered his project they're like dude some random guy from jordan created a programming thing that like all of our customers who are coming to learn at code academy they could just code in the browser they don't need to have like their own thing and so it's a side project for many years and he wants to make it a main project you know he's not taken very seriously he can't raise any money for it and he applies to yc three times it gets rejected three times and after getting rejected third time he's pretty you know discouraged he's like alright man whatever fy who cares and but the thing was that developers really thought this was cool because it was like kind of a technical achievement to do this to do this he had to like write his own compile and ride his own shit that like would work in the browser it worked with any language and so there was for example a atlas created a competitor this called glitch and at atlas had like a good track record of like trello and jira like they built like developer friendly tools so glitch comes out huge p move raises a bunch of money and they said it's coding in the browser he's like oh no they're doing it he goes but they're like it's all javascript because javascript is everything he's like well i made this choice this technical choice to support any language and these guys are saying it's all javascript and initially they got this huge boost but he started to notice that like this little language python started to get really popular on replica and he's like i think they're missing the boat i think python is the thing and python became the language of choice for machine learning it became the language of choice for back in development it became the the language of choice for a bunch of like big waves and he was the only one that can support python so glitch ends up dying that atlas company ends up ends up failing on and and and it he just keeps chugging along and along the way he he had this like kinda indie support so it was used by a lot of students a lot of teachers a lot of coding boot camps but that was kinda looked at like a toy like oh cute but those are just like beginners who have no money who whatever yeah i'm reading about him on hacker news like he was controversy controversial over there but a lot of people loved him some people fight them early on he was really loved on acronyms at him but like rep was really loved because it's was like kinda cool that you could do this and now i actually worked really well because he's you know a great programmer and one person who was reading hacker news really liked it and that person was paul graham now paul had retired from yc he was living in the uk in this like mansion and he's not a part of wi anymore and i'm trying got rejected from yc three times but paul graham looks like dude i think this is awesome and he tells sam alt who was running twice at the time i was you gotta talk to this company rep so he goes to meet sam at at the time was a hybrid office of open and ne link before open was a big deal back when open was just a research nonprofit and he meets sam and sam like hey you know i don't know anything about you but paul really likes your thing and he wants me to check this out and you know what you should just like talk to paul he told me but like i'm not the guy for this you just talked to about here's his email so i'm john ends up trading emails like the long emails he he said like i should turn this to a book someday of like my emails is back and forth as paul like the philosophical foundation of rep which was like what if you could enable like ten times more programmers in the world because this whole thing is about opportunity so how do you make a programmer who doesn't even have their own computer who doesn't know how to start who doesn't know how to like get everything installed in their environment all the stuff how do you decrease all the friction and eventually and even in his initial like plan was like we'll have ai that will help you code it'll be your pro your programming assistant this was back before ai was a i it's like twenty fourteen like people weren't even talking about ai back then and it's in his original slide deck i have a a slide here for you let me show you this was this master plan for a c deck we're gonna grow by building tools signing up teachers and students we're gonna build a simple network and an ai assisted interface that blur the distinction between learning and building and eventually we'll become a platform where people come to learn how to code code explore and host their code this is exactly what they've done it's like the tesla master plan ten years later this is his master plan ten years later they've done exactly this the company is ten years old now more than ten years old basically he i think he started this stuff like before twenty fourteen and so it was again it was a side project for a long time only became like a full time project and there's like he shared the email like hey got rejected again from yc and he's emailing christina who was his first investor christina is the founder of van another company i was gonna put on this list she wrote the first check into rep as a scout and van is a company that you know in five years has reached a hundred million dollars she went through but the way she did it was she just y load it she just like moved to a city and he he writes his email to christine he's like god rejected again hard to raise money right now i might just yolo just move somewhere low cost and just start building this thing that's that and then maybe was what i'll do and so look at this chart now so this is replica blood developers year over year it's literally like a perfect hockey stick and paul graham posted this and he's like the crazy thing about this is that this is this is an impressive chart for any company let alone a company where the users are developers meaning all of these developers are gonna build things that they has their own user base that is crazy and so this is the gross so back when we did this in twenty twenty one we were here and now we're here it's developers are there so github has about a hundred million wow wow wow wow by the way github some crazy stats on my research of get github github is used by ninety percent of the fortune five hundred it probably has like the most enterprise penetration of anything besides microsoft office like salesforce is eighty percent github is ninety percent which is pretty i get sold for so github sold back in twenty eighteen for seven and a half billion dollars and at the time they were doing right two hundred fifty to three hundred million in revenue github now does about two is about a two billion dollar run rate and by the way the fastest growing feature the thing that makes up forty percent of the growth of github revenue growth is c copilot is the ai assisted code that now does you know a few hundred million a year in revenue already after you know just a couple years profit and so that is the most successful you know ai implementation in any in any company so far is get helps covid three four hundred million a year product lot of people dislike this guy is he aggressive well he said something which is just like you know hacker news is you know when you're the underdog they love you and then as soon as they hear your big funding round they they go and they just how terrible you are there's all there's there's you know whatever this people ever i actually included this is part of my bold case is death yeah so it's they raise this money and then here comes this guy b fine man who says this is another company i felt gonna employed they don't do anything that's that's interesting let alone proprietary the ceo was an ass and everybody knows that he acts as if a browser a browser rep is gonna change the world i have no idea how their valuation is so lofty but the core technology is so easily duplicated yeah good go ahead go try it since the since the heavy listing the lifting they you to do has become obsolete so classic hack the you know go read this the launch of dropbox and airbnb and other other companies like this this is like you know there's always one of these comments at the top of their their their post that you wanna frame so check this out this is the ai growth so the the thing of the criticism of rep would have been great you're getting a bunch of developers but they're all young and how are you gonna make money off of students teachers and i think the the misunderstood part of this right because if you wanna find something at a low valuation it's not that low valuation is just another way of saying misunderstood and mis priced so what what it would be misunderstood here what what would you need to believe then you need to believe is that this is a leap frog technology so like i don't know if you've ever seen those graphs of like in africa it's like landline like landline adoption of mobile of phones in in your home was like really really low or bank accounts was really really low it was like you know some i don't know ten percent of the population had bank accounts and land landline phones but then and so you would think oh if this is linear you start with a landline phone then you get a cell phone or you start with a bank account then you start getting mobile pay like v moe or whatever actually those are easier to adopt and because they're on your phone they're quicker they're lighter away and so cell phones and mobile payments became this like huge adoption and africa actually has a higher rate of mobile payments than america it has a higher rate of cell phone adoption than america data at the time because it was it was a leap frog technologist was easier to adopt the smaller thing the or the newer thing than it was to adopt the old thing and so one of the things that just said i really like he goes you know people all the criticism of rep is great beginner people use replica because they learn how to code and it's just really easy to get started and the criticism is that like you're not gonna get like big developers to switch you know you know twenty your vets to switch to rep and he goes that the better question is if i have twenty million you know sort of earlier on in their they're coding career code right now and this is a place where they can get started with no friction build in any language that they want they have ai c copilot built in they can host it they don't need to know how to set up their servers and there's a community of other people that they can like you know borrow code from and share from and and answer questions with why would they ever switch like you're saying people will never switch from that like like these people will never switch back to oh actually go make your life harder what is your great point what valuations did you invest in i think like nine hundred million how'd did you meet them i've never met him in person this is a company i kind of admired i've used it and i went you know just look at him and read about it and it just immediately was it it ticked my boxes so by the way this is kinda interesting so jet brains which is another one of these like the the probably the most popular coding environment fully like job developers it's a bootstrap company that does two hundred seventy million in revenue hundred million in profit hundred thirty four million a year in free cash flow with six million users zero dollars raised since it started in into in the year two thousand and so like i think you know when you look at what is rep revenue potential i think it's it's a lot bigger than this because this has multiple things so what do you think they're worth right now what what is rapid worth what do you think they're worth today well their last valuation was one point one billion i know but what do you think is like if they were to raise again and it would be at what valuation you couldn't buy my stock you'd have to pay you'd have to pay like a fifty billion dollar evaluation to take my stock right now like i would rather just hold the stock and see where it goes why because you're looking ultimately in in tech investing for giant winners i think vc wants he told me like ever everyone's talking about unicorns i want god's he's like basically a gun company said you know the company that becomes worth fifty to a hundred billion plus and he's like those are the ones that make your career and so i was like cool cool branding he but but what do those companies have network effects so this is a network effect business where it's a network of developers it's growing like a staff infection a spring break so it's growing really fast like since the last time we did the sales list it's grown four x in terms of the number of developers who signed called the like looks like got a real rig room on your hands congrats dude exactly like i think it's price and misunderstood i think it gets discounted for being just something for beginner coat and when i think actually it's like a snapchat or whatever it's it's a product where that's the generation you want is the people who are gonna be using this thing for the next you know twenty thirty years it's riding a huge tech wave in that like it is perfectly positioned to ride the ai wave because ai programming is a thing yesterday sergey sergey brand was at the all in conference and he's like yeah i code with ai like he's he's yeah i got back into coding use ai based i just kinda tell ai what you it's like did the founder of google it's like yeah i wanted to build this thing but i just easier actually just for me to just tell i had to it and it kinda wrote all the code me was so awesome he's like then i showed it to my team at the like google like ai thing he's like he's like i told him i said more of you need to be using this and he's talking to like the top programmers in google which is kind of amazing dude this is awesome i think you gotta ask this guy out for prom i think it just did i think you just did this is like you asking taylor swift you know like someone better this is you've convinced me what's the downside i mean what what is the downside i you had that for every company that they're not gonna be able to make as so much revenue as you that people will graduate off of rep and decide that remote are they a remote company no actually another another sam bowl signal they're not remote and not only that they moved from s f to foster city to like build their own cult there and he's like why wouldn't we but when we move forward forty forty minutes out and just make be like the kings of this little area and have like the best the best environment without the problems of san francisco while still being in still been close enough to the talent density i think that you used all of this great logic and all these silly arguments and all these numbers and facts and data you should have just told me that he wants to build a a commune in foster city and i would've be i would've have been on board i do any dead lifts you like that i know you like that doesn't really dead lift yeah use your power lift yeah i mean power lift power gains like it makes sense i think my my simple strategy can almost be as effective as yours if you look at the our last our like our lives would say yes it does right like there's no knock on that i i strive to be more like you i think you you have it writing no but i'm only teasing it's part of me is being simple just because i literally don't understand that like when you're explaining that to me i'm like i have to learn what all this means as we go yeah it's fucking complicated tell the story about dude these guys are geniuses by the way these guys are geniuses to like and be able to invent things like that this i just think i just like i'm like we're not the same well i wrote two words that i would almost never write in a side deck i wrote mission driven and visionary for rep and those are so cringe you can't you're not even really allowed to say those unless there's an exception which is this dude from jordan who was like god i really wanna increase access to for kids like me built us as a side project when there was no money on the line there was nothing for years just kept kept tinkering away building it building it building it in his master plan from ten years ago in the seed deck was talking about how he's gonna have an ai assistant in your coding terminal that's gonna help you write the code and did exactly what he wrote you know ten plus years ago that is mission driven and that is visionary to me well mission driven being into mission driven and and and visionary stuff that's only cringe when it's not true when it's true it's awesome well it's because yeah because this gets abused try to get it's like gets to used and abused by everybody there's no like there's no there's no earning that badge right you just get to use it if you want which bastard merchandise it like you know you look at something like neuro link or whatever and you gotta give credit to these people like you know when there's there's videos of elon talking like you know decades ago about the four or five like most important things to do and he's like you know the the advent of the internet you know creating clean you know sustainable energy future creating artificial general intelligence safely he literally was saying these things for for you don't need to be mission driven in a visionary on world changing things to be into like that that makes it awesome but you can like if i meet someone who's into something like relatively trivial and they're they're passionate about it i still i get like turned on you know what i mean dude the gray upset it's like this guy his his rockets to mars is like the two hour cocktail party right it is helping people toot their harmonic and have a good time for two hours and much strangers to make some friends and he is more into that than anybody i know then then probably anybody that there is he wrote a book about the thing for god's sake and then on top of it even though i literally don't wanna do that like i would hate if i had to host one of those things i love being around nick because that energy is so like you i said into it's the perfect word for it yeah when i am and so when i see a guy like replica i'm like i don't really like care about any of that stuff but i care that you called your shot and i'm into it during covid when we all had to work from home i got to hear brian c give these like monthly or weekly meetings and he was like in his bedroom and he looked horrible he looked like shit because like his business was like on top of the world and that it's like i don't know if we're gonna be in business and i have like three thousand employees i'd like travels literally the worst thing on her like airbnb is paused and i remember seeing his talks and i thought like dude i will i wanna fight for this guy like if if i was on his team he has got me bought in and that so my point being is that mission driven and visionary attitude that is actually really important when it comes to a value how valuable start up can get i think it is if you're making your bet which is what we talked about basically take taking your time your talents and betting on one company a super concentrated portfolio where you're gonna and you basically are getting a hundred to two hundred thousand dollar bet that you get to make on a company when you when you take a job at one of these tech companies you might as well bet on the most talented most driven you know mission oriented sees the future more than anybody else type of founder because it's their decisions that are gonna trickle down i remember i made a ethereum and well ethereum is probably one of the best investments ever made and i made it more on the sam criteria i was like this gang ultra nerd who words that i barely understand this responders got the fitness neck i've ever seen i'm in and everything i read about the i was like show like sixteen he's like or whatever eighteen he's writing articles for bitcoin magazine because he was so enthusiastic about it hey he was getting paid for bitcoin which at the time was like twelve dollars per article and that's kind of like how he you know he is he's truly like of this he didn't come when it was time to get rich she was there before and then i remember when ethereum hit an all time high and everybody on twitter was basically like lamb and yachts and you know like top of their bag he posted the twitter thread that was like hey this is great but like how many of the un bank have we bank how many people have we actually help how much of the mission are we actually doing like yeah the price went up but who gives a shit and that is you know the the best founders do that when morale is low like the brian chest example yeah they give you that confidence they never let you get that low they like bring you up and when hype is high they bring you back down to reality of like what are we here to do and that that i when i saw that and i was like this guy is crypto is full of potential but it's full of pump it's full of you know people are gonna take advantage of this i at least trusted that the person who was steward that project was not you know to use bass terms they were here for the right reasons if vital metallic is here for the right reasons he was there to actually you know like help humanity and build build a free economic system to use what terms the bachelor you you don't you don't know that but every test it it's like sports everybody's bachelor do you like i have triceps and but t levels are over three hundreds under tell you that there's difference between a barbell or dumbbell bench press and why why each is good you could tell me all about the golden bachelor just i can you're absolutely absolutely right priorities alright that's the pod that was good thank you sean thank you ari thank you to everyone listening i feel like i could rude where i know i could be what i want to put at all in it like a days off on a less travel never looking back