Chapter 1: What is the main topic discussed in this episode?
First time with his new fund, AMP PBC. He's here in the waiting room. He's here with us in the TV panel.
The man that defines generational run.
Yes. Generational runs.
It's getting started, guys.
No, generational runs are used for people who are retiring. Oh, yeah.
That's true.
That's true. I think it's appropriate to recognize. I think it's important to recognize when you're on a generational run that you realize you have to actually level up even further if you want to stay on the same trajectory.
Yeah, yeah.
Because if you just get complacent, then...
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Chapter 2: How does Anjney Midha define the compute bottleneck in AI?
Mm-hmm.
How many new users did they get for that? I mean, you guys are marketers, so you understand. One million. Whoa. That's crazy. The user base went from 134 million users to 135 million users after spending $2.4 billion on marketing.
And that's basically, you would have to imagine they're just having to reacquire all their old users, people that have been on the platform before or maybe even lost their account and they're coming back.
I don't know, but that's $2,400 of marketing per new user on a site that every American already knows exists. So where's all that money going? I don't think Cohen is buying eBay. Just watching Ryan, I don't think he's buying eBay because he thinks he's smarter than eBay's product team. I think he's buying eBay because he can see $2 billion of fat that Wall Street has been pricing as fixed cost.
And so he goes, okay, let me cut that. And the interest on the debt just pays for itself.
Interesting. But he doesn't necessarily want to say that because he could kind of... give that idea to the management team.
But he still has to put the money together, right? But is your thesis that the deal is coming together, he has investors that he's talking to, but it's too early to say, oh, yeah, I actually do have a fund that's going to give me another five over here. I got seven over here. And it will math out, but just give me a week. Or is there something else going on?
It depends on which investor he's talking to. But if he was pitching me, here's what I would underwrite. I'd say, OK, that's the floor. The floor is Ryan's going to cut $2 billion from this thing of fat. Put that into treasuries and we're going to make more money than it's currently yielding. Okay, so that's the floor. Now the ceiling, because I'm a technology investor, right?
Yeah, the opportunity. The bull case. The bull case. So Amazon's used and collectibles business has been flat for six years.
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Chapter 3: What strategies are being used to create a coordinated compute grid?
I have Claude go look for rare pens and glasses for me online. The biggest problem with used rare asset purchases is fraud. So Claude will be like, ìAndrzej, I found this amazing pen, this Montblanc pen.î And I say, ìOkay, can you triple check that it's real, it's not fake?î And that's where things go up real because there's no way for him to verify that without messaging the agent and so on.
But if you have 1600 stores where people who have Montblanc pens can go and physically verify those assets at GameStop. Now, Claude just says, yeah, I checked. It has the physical verification stamp from- Somebody brought it in. Exactly. So you need physical verification built into the system for agentic commerce.
And look, the reason I know this is real is because a few years ago, I think you guys, we talked about this last time, but I sold my last startup to a company called Discord in 2020, peak pandemic. So I come on as the head of platform. My job is supposed to be, you know, go build SDKs, APIs and so on for gaming. We help this company called Midjourney get going, AI, you know, generate.
But 12 months later, suddenly I find myself running without realizing an e-commerce business because it was the summer of NFTs. And the board A's are blowing up. And suddenly, we have more than $10 billion of GMV flowing through Discord buy, sell, trade channels. And Jason and Stan are like, hey, brother, your job is to capture a piece of that pie. Okay, homework accepted.
So we start doing a deep dive. And we realized ultimately what these users need and pay for, like, so you have liquidity, right? Ultimately, that's what a marketplace like eBay and Discord provide in sort of community commerce is liquidity. But you cannot provide liquidity if you don't have physical verification. And for Discord, that was just out of scope. You know, use sneakers.
And it worked. You're saying it worked for NFTs because you had the on-chain.
Yeah, you don't need any physical. There's nothing physical to verify.
The user physically owned it and you can transact.
Yep. Exactly. And so we are bootstrapping the e-commerce platform at Discord with NFTs. But, of course, everyone on the board is like, well, how long are NFTs going to last? It's a fad. So, Ange, what else is coming? We go look at rare sneakers or keyboards. like bands, all this stuff that nerds like me love.
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Chapter 4: How does AMP aim to support the next generation of AI labs?
notebooks and pens and cars. And there's this very scarce input called coal that everybody is hoarding. In this case, it's compute. And when I, if you fly over industrial era, England, you'll see all these factories getting set up and everyone's running a generator in their backyard at half capacity. I'm going, this makes no sense.
If I'm looking at all my portfolio companies, you know, these, these clusters are running at like half utilization. In fact, Elon's like got 500,000 GB 300 in Memphis and, at running an 11% MFU and less than 60% node allocation. I mean, this is $12 billion of compute being wasted.
So I set up AMP as an AI infrastructure organization where we buy a bunch of compute, we do long-term leases, we pull all those clusters on the grid, we coordinate capacity, drive up utilization. And by the end of this year, I think we'll have several billion dollars of compute coming online. But that's what I've been focused on night and day since I left in recent Horowitz in January.
And so, no, I have not had time to look at how to redo eBay. But if Ryan called, I'd probably help him out. But right now, it's wartime on compute, guys.
I want to talk about AMP, but I also want to talk about just last question on the combination of eBay and GameStop. I get the thesis, the bull case. GameStop is $10 billion. eBay is like $48 billion right now. You put them together. Maybe you get to 100 billion. I'm in for the bull case. The question is like, what's going on with the plan?
Because it feels like Ryan just doesn't have the capital, but then he announced it. What do you think is happening behind the scenes? Because there's one thing where you could throw it out as like, oh, these two companies should work together. Here's a bull case. Let me know if you want to be on the team that does this.
And then there's the other one, which is like, make the offer before the capital's lined up. But I just haven't been through enough of these stories to actually understand why it's playing out this particular way.
To be honest, I think he's sitting there with, he has $9 billion of cash. He's in a $10 billion company. I think when he announced this, I think he expected the stock to pop like crazy. And he'd be going on CNBC being like, this merger sucks. could make sense. Sure.
And I think that- We'll issue another $20 billion of equity, and then we'll merge or something.
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Chapter 5: What insights does Anjney provide about the inefficiencies in the AI economy?
And the infrastructure business secures compute and passes on at cost to our portfolio companies. We have more than $1.3 billion in commits for our first fund. I've been at it eight weeks. And so we do venture capital investments. We put $300 million into Anthropic.
Yeah.
Oh, okay, cool. We need to raise another roughly $6.5 billion this year and more is getting committed by the day. But we give away the compute at cost to the independent ecosystem because my belief is that they're like sort of
that the optimal unit of research today is a, like a focused talent and steam outside of the hyperscalers, you know, anthropic encoding, which was, I was the first, one of the first, I'm certainly, I think I'm the first angel investor, if not the first investor in the round.
They're saying you're the Jason Calacanis of anthropic.
Unfortunately, JCal, I could never top JCal, but if I'm JCal intern or something, fine, I'll take the win. But I think more importantly, I think compute is this strategic asset, which I've been yelling about for four years, and it's a primary bottleneck on these teams. And if you're not at the hyperscalers, you just can't get access.
So we buy up that compute, we give it at cost to the portfolio teams, and then we reinvest the profits of carry and fees to buy more compute and so on and so forth. And so I'll take as much capacity as I can get from Allbirds. I love it when new people go into the business because that gives us more supply. So if you're the Allbirds CEO listening to this, please send us your compute.
We'll take it all.
That makes a lot of sense. What are you excited to invest in? You're investing in teams that need a lot of compute. You're trying to find things that aren't going to get steamrolled by Anthropic, who's another big portfolio company. There's, you know, I'm sure you see opportunity everywhere.
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Chapter 6: How does the discussion transition to the future of AI and technological advancements?
We then have robots synthesize the new materials. We then have an X-ray diffraction machine that tests whether the material has the properties that the AI said. And then we pipe that verification loop back into the training ground as many times as we need for the agents to continue predicting new superconductors. And in the last 90 days,
We've had more material verifications than I think in the last decade in the field. And so I'm a huge believer in unblocking frontier progress and domains where it, the verification sort of loop is clearly just like, we know it's going to work, but execution is the bottleneck.
And then I like getting these, the best teams, the best scientists, the best engineers, the capital to compute the commercial help they need. Now, I think that the beauty about having Anthropic around is that it's made this idea of the bitter lesson and scaling legible to the capital market.
So now, instead of me having to call up 22 friends, I'm getting 21 no's, which was the case with the seed round of Anthropic. Now I make two calls. Instead, we get like, you know, we get three times oversubscribed. So capital is no longer the bottleneck, which is phenomenal. You know, again, we've been at it eight weeks, have more than a billion dollars committed for our first fund. I'm a solo.
key man GP on the fund and there's lots of institutions pension funds sovereign funds who are like how much more can you put to work especially in publics privates buyouts it's a bonanza for people who want to be true partners who want to be the Arthur Rock of this era I think if you believe in the bitter lesson it's not new it's been around for ages you and I the three of us talked about this like over a year ago at the last recent Horowitz AGM yeah still better
I'm more Zen than I am bitter. How are you thinking about building out the team on both sides? Trust is the moat. So there's five of us on the team. My full-time engineering co-founder is Sebastian Lobo. We were roommates 14 years ago at Stanford, and then he went on to build a grid. Overnight success. Here we go. What was that one? Overnight success. Overnight success. Thank you.
12-year overnight success in California. Exactly. So Seb and Mihai built the Borg XBorg GQM scheduler, which kept the Google internal capacity pool at more than 95% utilization. Therefore, it was at 94% utilization that was considered a major outage globally. Andrew Erskine is my partner on the operations side. He was a partner at Auric, which was the outside counsel for Anthropic.
And he was my GC at Ubiquity 6, which was the company I sold to Discord. And then Rosie, who's my chief of staff, ran comms for me from Edelman when I was at Andreessen Horowitz, when I was a GP there. And so you got the band back together. It's the Ange reunion, basically. And, you know, we put we called AMP not after my initials.
Sometimes people think that it's not Ange Metapartners or anything like that. It's about energy. It's about, you know, Ampere is the unit of energy. And we want to amp things up because we think we're entering like the great renaissance in technology.
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Chapter 7: What role does physical verification play in the AI-driven marketplace?
How are you thinking about navigating both of those asset classes? We are in process.
We are in process of becoming an RIA because we founded the firm barely you know, 90 days ago, but I'm used to that cadence because Andreessen Horowitz was a RIA. I was a general partner in the AI infrastructure fund for several years, as you guys know, and we were an RIA. I'm used to the compliance, the regulatory sort of guardrails we got to follow.
And I think LPs trust us to, you know, have that cadence from day one. And so we're going to make sure that we, you know, Zach, if you remember this, like, you know, 12 years ago, Zach went on TV to say, move fast and break things. And then you have to update the thing and be like, move fast with stable infrastructure.
And I think we move fast with stable infrastructure from day one, essentially, because we are an AI infrastructure team.
Yeah. Talking about the PBC, if I'm playing back, what year were you referencing? 1850 or something like that?
1885.
1885. So if I go back to 1885 and I think about the financiers that created the industrial build-out, they were not public benefit corporations.
They were personal benefit corporations.
Yeah. And I mean, there was a lot of good that was created. We got railroads and trains and, you know, machinery and cars and all sorts of things out of the Industrial Revolution. There were also things that were rough and there was unionization and battles and back and forth. Like, what is the PBC in service of solving? Why PBC?
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Chapter 8: What are Anjney's thoughts on the future of AI and its societal impact?
Thank you. And now I'm back at Stanford teaching CS 153, which is the largest class on campus. It's called AI Coachella. We've got thousands of people following along. And, and, It's got frontier systems because it's all possible now. We're literally in our lifetime. We're going to have flying cars. We're going to have room temperature superconductors. We are going to solve cancer.
We just want to do it in a way that's stable, predictable. We want to skip all the boom and bust cycles. And the way to do that is to lead by example and say, hey, guys, the public benefit is to provide goods and services that are utilities and make sure that we don't like.
Let's be the adults in the room and not do the stuff where we tried to be robber bands and monopolists and got greedy along the way. And so that's the substantive answer. The Vibes answer is, look, I don't want to get sued by shareholders for whom it's not legible why I'm giving away billions of dollars of compute at cost to portfolio companies, right? Because that's what we're doing.
And that shareholder, you could argue that shareholder value that we're destroying, but I would argue in the long term, we're actually creating orders of magnitude more value
and if you look at ben and jerry's you look at rei they've become stable enduring businesses in categories that are fairly crowded and eventually i do think technology and ai will get crowded it will get commoditized because technology is never the mode trust is community is a mode culture is a mode execution is a mode and so we're trying to skip ahead to that part but it takes time for people to get aligned so until then what we see what we see in amp joint venture with private equity to uh help distribute diffusion
If we can. Yeah. You know, if you go to our website, it's called AmpPublic.com. Because I do think if you look back to the like vulture era of private equity, you remember like RJR Nabisco and what the barbarians at the gate, we should just learn from from their mistakes and go, can we do private equity, but done right in an aligned way?
Let's not rush to like lay off, you know, hundreds of thousands of people and then not reeducate them and prepare them for their new opportunities. I'm an optimist, as you guys know, I came from Andreessen Horowitz University. So I'm sort of a rational optimist. I believe the transition can be done in a positive way. Is that me getting kicked off?
There's like a bell ringing, but that might be here.
No, I don't know. The only bell we have is this.
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