Reid Hoffman

By the way, incorrect, but yes. We're not reaching the upper end of LLM. It's kind of like, look, the press cycles like to go, aha, we haven't seen anything in the last six months. We're at the upper end. It's like, oh, if it were, we haven't seen anything. By the way, we did see GPT-01, right? If we hadn't seen anything in the last couple of months, that doesn't mean it's the end of the cycle.

That means we're still getting to what the next set of stunning things. I think the next larger computer, the next large LLM that's trained with a larger computer will still have new magic in it. And all of the people who argue against it are to some degree arguing their own book. Well, I don't have the compute. So the next level of compute won't make a difference. I don't have the data.

So the next level of data won't make the next difference. Or the current data is all we have. And so we won't be able to do it. It's like, well, actually, in fact, we can create synthetic data. And there's a ton of data that's out there that's not part of the standard internet training corpus. The scale game is still playing.

Well, by the way, he's right that, look, we're going to have a ton of agents. And I think the agents will be composed of multiple models. But to count out the next level of scale models as being important in creating a number of quality agents is just incorrect.

do you worry when you look at the pricing of some of the investments going down today that it's just a complete bubble well so when everyone understands that a technology transformation is happening a bunch of people make foolish investments it happened in the internet it happened in mobile right it happens

But because there's some foolish investments doesn't mean there aren't also really good investments that change. And so part of the work for being a good investor is to on a probability basis, because you will make some foolish investments too, to make sure that you have some of the really good ones.

And by the way, sometimes the decision of foolish or wise is doing something that may seem like it's a crazy price.

When I did the series A of Airbnb, there were 60 million posts. At that time, the founders probably could have gotten on the phone all week and called every single person who had used an Airbnb that week if they were working through the call list. So it was a very small transactional volume. And the question is, would it grow? What would happen with cities?

What would happen with market acceptance? There's a bunch of other things. But part of the way that I invest is I go, look, if I'm right, if the theory of this investment is correct, then it will transform an industry. And that's what I tend to do as an investor. It's majority of my investments, not all, there's sometimes other things.

But if that plays out to be the case, and so then is my theory of my investment at least a reasonable probability, right? Like it has a reasonable chance of working. And that's why I did the Airbnb one. So that would be one example. But I also tend to be more careful about part of the discipline that I've learned from Silicon Valley is when you look at a seed, a series A, a series B.

It isn't that price is irrelevant. Does the coherent sense of this make sense in terms of what future capital will need, how the entrepreneurs are thinking about their business? And so that's part of where pricing comes in.

Well, in a well-functioning society, hopefully it's acquisitions rather than acquirers. Part of the thing, there's a thread of antitrust that misunderstands their own game. So, for example, the thread of antitrust roughly looks like this. It says, we should stop the aggregation of power in the large companies, so we should block acquisitions.

And in some cases, limited specific cases, that makes sense. But in general, if you want competition with those large companies from startups, investors, say for example, I'm an investor who's going to put a billion dollars into a company that might compete with one of the large tech companies.

I'm only going to put the billion dollars in if I have a chance of an acquisition exit because I'm going to need the billion dollars back possibly. That's a huge loss. So if I am blocked, if you have a regulatory authority to say we are never going to allow that, then I'm never going to do the investment that allows a company to potentially compete with those large tech companies.

And so their theory, which is we're stopping the aggregation of big power, is they're creating more aggregation of big power because they're stopping the financing of competition.

Well, I hope so. And by the way, I think it's good for society. It's good for competition. It's good for investing in the competition. And so that's part of the reason why I've kind of made public statements around this, because it's not that I'm saying, oh, antitrust is bogus. I'm saying you actually got the exact wrong theory of the game.

Yes, shortly. Look, I'm an investor and all the rest. And I think Figma is an amazing company that's going to – I'm probably going to make substantially more money because the deal was essentially derailed. But there was a bad theory of the case.

Great question. So what I think is that the AI revolution will both create enormous value for the large companies and enormous value for the small companies. And it's going to do both. And part of that is because I don't think it's a big tech question. I don't think it's a little tech question. I think it's a scale tech question.

And I think part of what we do as investors and creators and creators in new industries, we invest in scaling technology. It starts small and it gets very large. And we want more large tech companies. The answer is not we want fewer large tech companies. We want more large tech companies.

I actually almost never look at multiples.