渤健阿尔茨海默药获批引争议、亿万富翁太空竞赛、比特币与干细胞

David Sacks (00:00:01): Like, Jacob, you get any closer to the camera? I mean, your face is, like, right up in there. David Friedberg (00:00:05): We can see your bloodshot eyes. Chamath Palihapitiya (00:00:07): Oh, god. It's really amazing. David Sacks (00:00:08): 9 Jason Calacanis (00:00:08): AM start time is a little rough on Jacob. A little rough on Jacob. David Sacks (00:00:13): That's true. I want my second cup of coffee or any. Jason Calacanis (00:00:16): This is this is a lifestyle choice. We may regret it. The Leonard Winter Live. Rainman David Sanders. Speaker 5 (00:00:27): And as I said, we open source it to the fans and they've just gone for reason with Chamath Palihapitiya (00:00:31): it. Love you Jason Calacanis (00:00:35): Hey, everybody. Hey, everybody. Hey, everybody. Welcome to another episode of the all in podcast. It's Saturday morning. It's ridiculously early, but we're taping the show because one of the besties happens to have left the continent with us from an undisclosed location, Chomov Polyhappatia. Are you in a wine cellar or in catacombs? Chamath Palihapitiya (00:00:58): I am in. I am in. Look at it. Wait for it. Wait for it. Wow. Were you able to see that or no? Speaker 5 (00:01:05): No. What was that? Are you in a Jason Calacanis (00:01:06): are you in the cathedral somewhere? David Friedberg (00:01:08): You mean the ceiling of your room? Chamath Palihapitiya (00:01:10): The clocks are the ceiling. Jason Calacanis (00:01:11): It's incredible. Show. You paid for four walls, and now you can afford the roof. David Friedberg (00:01:15): Fantastic. Okay. Hold on. I'll do a little I'll do a little Jason Calacanis (00:01:19): let's see if you can just Chamath Palihapitiya (00:01:20): see outside and get a sense of The view? Oh, you can't. Oh, no. It's harder. Jason Calacanis (00:01:24): We can't just stop pause for a sec. Woah. Woah. Besty lifestyle happening there. Just gotta hold it for a second, and then then David Sacks (00:01:29): -- Speaker 5 (00:01:30): Oh, no. Chamath Palihapitiya (00:01:30): That's my architect. Jason Calacanis (00:01:31): Hold on. Chamath Palihapitiya (00:01:33): I'm cooking too. Speaker 6 (00:01:34): Wow. -- here. Chamath Palihapitiya (00:01:35): I love how David Friedberg (00:01:35): the I love how the house is already built, and he's still paying the architect. Jason Calacanis (00:01:38): Yeah. He's like, do me favor. This came out great, but -- Yeah. David Sacks (00:01:40): -- Jason Calacanis (00:01:40): you rip down these four rooms and then just start over. Alright. Well, we lost Besty C as he walks around his castle in some European country David Sacks (00:01:49): Welcome to the lifestyles of the rich and famous -- Jason Calacanis (00:01:51): What time is it there for you? Chamath Palihapitiya (00:01:53): Well, it's 6 in the afternoon. 6 in the evening. I I was in London last week in holy mackerel. the weather if you wanna see climate change, spend some time in Europe because literally day over day, London on the first day I landed was Call it 24 Degrees Celsius. So whatever that is, David Sacks (00:02:11): 80, 78, Chamath Palihapitiya (00:02:12): maybe. Beautiful. Literally, the next day, it was 62 and raining, and it just kept bouncing back and forth. It is the weirdest thing. And if you're in Europe right now, you you just see some of the craziest weather patterns literally day over day, massive thunder showers, then it's completely normal. I mean, no wonder everybody here takes climate change so seriously. You'd actually feel it every day. Jason Calacanis (00:02:38): And with us as well, David Sacks is here, the rain man himself tearing up the Twitter. We've been off for 2 weeks, so there's a lot to cover. And, of course, The queen of Kinois, chairman of the production board David Friedberg right the bat, I think we gotta go science to get the Friedberg ratio up from the get. Biogen has an Alzheimer's drug that on Monday, the FDA approved. It's the 1st new treatment for Alzheimer's in almost 2 decades. And Biogen's drug is not a cure for Alzheimer's, and Friedberg will get into that. It does reverse the disease's progression, but it does mitigate it gets it getting worse. Very strange moment in time. The FDA's advisory panel, 3 members of it have quit because they didn't want to approve this drug because it had such a modest efficacy? David Sacks (00:03:29): 3 Chamath Palihapitiya (00:03:29): quick but unanimous vote against approval. Jason Calacanis (00:03:32): Right. So unanimous vote against, then 3 quit. And this is, I think, out of David Sacks (00:03:35): 10 Jason Calacanis (00:03:35): or 11 individuals. So this is truly significant. The drug is going to cost David Sacks (00:03:40): 55 $1000. Jason Calacanis (00:03:41): It still requires brain scans and all this kind of stuff, but it's hoped for people suffering. And so the FDA approved it Friedberg, tell us on a science basis what we're seeing here is what's happening in journalism social media now happening in science? Or is this some other, you know, search or truth or some other issue? David Friedberg (00:04:03): The Biogen drug that was approved this week is called Edu Canomab. Remember any drug that ends with MAB, means monoclonal antibody. So it's an antibody and antibodies, you know, as we've talked about in the past are proteins that can be made by our immune system and proteins that bind to a specific target that then tells your immune system to clear that target out of your body. So that's what monoclonal antibodies do. And we have been using biologic drugs, monoclonal antibody drugs for decades now to target specific cells or specific proteins in our body that we can then remove from our body, and that can reverse or change, you know, human health in very significant ways. So this is a you know, a class of drugs that is very efficacious for having specific outcomes across many disease states. And so years ago, researchers at the University of Zurich were looking at people with Alzheimer's that were having slowly progressive dementia, and they looked at antibodies that they could find in their brain. And they found this antibody that they saw was binding to amyloid plaque. And amyloid plaque is one of the theorized mechanisms by which Alzheimer's progresses. That is amyloid plaque builds up in your brain, you know, you start to have dysfunction and inflammation and then the amyloid clot kind of maybe the driver of Alzheimer's, but that is not proven. So they then, you know, ultimately gave it to a company called Neuromune who licensed it to Biogen. Biogen started testing it. And they took this antibody that they discovered. And they turned it into a a a a, you know, an antibody. You can now get injected into your body, goes into your brain. It buy the idea is it binds to amyloid plaque and removes it from your brain. And so theoretically, this should slow down or stop Alzheimer's. But it turns out that as they ran this test across thousands of patients, it didn't have as much of an effect. And in fact, the data across many, many patients showed that it didn't really off of a placebo baseline, meaning people that didn't get the drug versus people that did get the drug, that it wasn't really that different in terms of cognitive scores and tests and all this other stuff. So they abandoned it a few years ago. David Friedberg (00:06:09): They kinda got this they stopped the trial. They had this kind of negative outcome, and, you know, Biogen got beat up for it. And then all of a sudden, they refiled about 9 months later with the FDA saying, well, look. When we look at the patients with the highest dosage of the drug because they gave it in different doses of the the people that got the most antibodies, this particular group of people had a 23% decline in the progression of their Alzheimer's, which is kind of one way of slicing the data. And as a result, they went back to the FDA, and people were like, well, you know, some of the tests don't really show that still. There were some cognitive test results that didn't show that that was the case. and they fought back against and so some people were pushing back against it. And we're not sure. No one knows for sure how it all kind of came together at the end, but the FDA ultimately approved this drug. And here's challenging about this. You basically will go in. You'll get an injection of this this antibody just like you do with many other antibody based therapies. It costs roughly $5 to make antibody therapy just to be clear. So when you make them 5 bucks roughly as the cost, and they're charging David Sacks (00:07:10): $56,000 David Friedberg (00:07:12): for this treatment. So that's problem 1 in the pharmaceutical kind of debate is should we be charging the, you know, the quality of life premium and the number 2 -- -- puppy. Yeah. And then the part you know, the kind of second issue is, like, should this thing have been approved when it wasn't really that efficacious and you could slice the data slightly, And now all payers, you know, meaning all people who are insured or the government or whoever it is that's responsible for insurance payments is ultimately bearing the cost of everyone with Alzheimer's, and there's 15,000,000 people in the United States with Alzheimer's, they're gonna raise their hand and say, oh my god. Anything that gives me any chance or any hope I wanna get, But if it costs $56,000, is it really the responsibility of the insurance company and all the payers to give everyone a hope even if the drug may not work? Now the downside in the side effect is negligible. there's no risk to taking this drug. So it's all about the cost and the upside. And that that that that is the big philosophical debate right now. It's like, first of all, should we approve drugs like this? should we allow pharma companies to charge whatever they want even when the efficacy is very low, and the cost is very low to make this stuff. And how do we ultimately decide what -- So Jason Calacanis (00:08:13): this is in, what we take for reward, Chamath, how do you look at this on a financial basis? Chamath Palihapitiya (00:08:17): Yeah. Let me let me let me give you sort of like a a market investing kind of view on this. Look. I've been taking biotech pretty seriously over the last 18 months just trying to learn because I think basically, Friedberg in you know, incepted me with this idea that you you have to know it. So here's what's interesting in the setup for what I've learned and putting a little bit of my knowledge together, which is dangerous. But the setup for Alzheimer's is really scary. If you're black, you're 20% more likely to get it. If you look at the distribution of all patients, 60% and upwards of, you know, David Sacks (00:08:55): 64, 65% Chamath Palihapitiya (00:08:57): are women. So if you think about the distribution of this disease, it's it's the disease of minorities and it's the disease of women. Now that's problematic in and of itself because if you wanna have any form of equality, it seems like this is something that we have to tackle. The second interesting thing as a as a setup to this is every single Alzheimer's drug that's ever gone through the FDA has been rejected and has failed. And what's interesting and the the the more social science around this is this is also where 2 of the more infamous insider trading events ever happened was around failed Alzheimer's drug. The first, which is less known, but inside baseball is what happened at sac which was a huge hedge fund. But the second that's very well known is Martha Stewart and why she went to jail was around an the speculation in the insider trading of the phase 3 results of an Alzheimer's drug, which ultimately turned out to fill. It was almost the surest money on Wall Street, which is every time some some one of these drugs came to market, you just bet against it and it would turn out these stocks would collapse. So there is the social and market setup. I am super torn, but I think there are some positive points to make on this thing. So let me give you the negative case. The negative case is what is the FDA doing approving a drug where there's no clear evidence that at least the clinical benefits and it could give families sense of false hope. What are you doing in terms of process if you have a unanimous vote against approval So why do you even bother having an FDA advisory committee of outside experts if they're just gonna do what you want? And it could set a precedent where companies can get drugs approved on limited evidence. Now here's the positive point, which is they may be taking a long term view And what they could be really doing is creating a market that ultimately incentivizes other folks to come in where then ultimately those people are the ones that find the solution. Chamath Palihapitiya (00:10:48): Right? because this Biogen drug Biogen came out and basically said, we think this is a $100,000,000,000 market. So now all of a sudden, you must believe Capitalism is gonna take hold, and a lot of young startups will say, well, shit. I should be going after this market as well. And so by going after that, after Biogen, then maybe you actually do get to the solution. And just a kind of a a little bit of trivia, it turns out that the acting FDA Commissioner in 2016 This woman, Janet Woodcock, she was the one that approved a different form of drug in the exact same setup. That one was at leptricen, which is basically for Duchenne muscular dystrophy. In a negative panel vote, she basically said, nope. We're going with this. The scientific community reacted similarly back then. But she basically took the view that, you know, you're doing no harm exactly what you said, Freeport, because the safety says it's fine. You're doing no harm to the patients by approving this drug, and maybe it might turn out to work in the end. And in that specific case for Duchenne muscular dystrophy, what we see 4 years later is that now there are a lot more companies focused on finding a solution, and they're pouring a ton of money into r and d. And maybe one of those things will break through. So I think she could just be running the same playbook here in Alzheimer's, which is important enough that somebody needs to do something. David Friedberg (00:12:04): You're saying the economic incentive could drive further innovation in this space that ultimately could benefit patients more truly than this current drug. Chamath Palihapitiya (00:12:12): I think so. And I think, like, you know, what look. A lot of, like, I think, drugs that that are potential solutions In many ways, I think what the FDA is doing are 2 things which I think are really positive. The first is that they're accelerating their approval timelines. Right? So you can have breakthrough approval and innovations And so you can get to market much, much faster. The best example is what we've seen in these vaccines. But the second thing is if you have a well structured safety study that says that these things are not harmful to humans. Then, yeah, David, I it's it's basically saying, sell a $56,000 drug there's a $10,000 copay. Now we should talk about that because that shows how broken Medicare plan b is part b, sorry. But, yeah, they're creating a $100,000,000,000 market out of nothing. David Friedberg (00:12:59): Yeah. But should should that be the case Chimov, or should it be regulated? Because, ultimately, if the regulators are approving the drug, and enabling the commercial opportunity, shouldn't the regulators also say, you know what? You can have this commercial opportunity, but you can only charge x. because we're not gonna have those taxpayer pay the why or package Chamath Palihapitiya (00:13:17): it up. David Sacks (00:13:17): -- Jason Calacanis (00:13:18): Friedberg. Let me ask a a a really basic question here. Why is there no you know, document put out by the FDA saying, here's how we came to this decision in plain English or is there because I looked for that, couldn't find it. In other words, you know, the same way there was a vote, they could say, hey. Listen. We understand the vote. We're overruling it for this reason. And why isn't there an interim step? David Friedberg (00:13:38): The FDA is not the the FDA is not your doctor. Right? So I I think the way things are set up is your doctor is meant to be informed about the panel's review of drugs, and they and there are labels that doctors need to be able to read and understand. And then the doctor's job is to make a decision on treatment for their patients and make a recommendation to their patients. So Ultimately, the FDA is not a consumer organization. The labels that get approved, what the pharmaceutical companies have to say about their drug, all of that stuff is overseen by the regulators of the FDA. And then that is then used by the doctors to make treatment decisions and an ultimately -- They didn't kick Jason Calacanis (00:14:12): this back and say, listen. Chamath Palihapitiya (00:14:13): No. Jason. Jason Calacanis (00:14:13): But couldn't they kick it back and say, we want you to do one more trial or some bridged up here. Hey. You can do ten thousand people over the next three years. They do that. David Friedberg (00:14:20): And by the way, can and and they are gonna do studies on aducanumab as it goes into market. And they always do that, and they always ask for more data, and they do this continuous review. The FDA is a really strong body at a really strong regulatory body, and we should all feel kinda pretty well, you know, safe and secure. But but the issue is really I think the economic question on the other end, which is They could approve a 100 drugs tomorrow. And then what happens to the economics of health care if everyone's allowed to charge any price they want for any care if it has even the slightest range of efficacy not gonna be able to afford anything. You know? Jason Calacanis (00:14:51): So just to so this is Chamath Palihapitiya (00:14:52): where, like, you know, regulatory bodies run run into each other because the effort so Alzheimer's Alzheimer's is a drug of the old. Right? Health care expenses are covered by Medicare. And in Medicare, there's a section called Medicare Part B, which effectively is a way for these drugs to go to market. Just so you guys know, under Medicare Part b plan, a physician gets a 6% kickback of the price of the drug. Your doctor gets 6% of that David Sacks (00:15:22): $57,000. David Friedberg (00:15:24): That's a terrible incentive. Chamath Palihapitiya (00:15:25): It's a it's an incredibly bad incentive. And so David Sacks (00:15:28): -- $3000 Jason Calacanis (00:15:29): every time you put somebody on this, it's quite a spiff. Chamath Palihapitiya (00:15:32): It is. And and so and so, you know, Medicare Part B has been this mechanism that people have wanted to undo for a long time. Now if you're sitting in the FDA, you can't change that because that's covered by CMS. David Friedberg (00:15:42): So that's not your that's not your jurisdiction. Chamath Palihapitiya (00:15:44): I think it's like this weird intergovernmental agency warfare, push, and pull, and trying to move the incentives. This all goes back to if Congress can't act Then all these folks have all of these other random tools. They just have to throw the spaghetti against the wall, and this is the kind of stuff that happens. Because Congress should actually be fixing this in a more substantive holistic way and until they do it, this is what's gonna happen. David Friedberg (00:16:07): This is no different than what we saw during the pandemic where we had health regulators coming in, local health regulators, public health officials saying everything shut down because their incentive is to save lives. Their incentive is not to balance the trade off between saving lives and protecting the people versus the economic damage and the fallout and the cost of it. And there are 2 different agencies, and, ultimately, the synthesis of these decisions isn't being managed by a leader anywhere or by a leading organization anywhere, and that's where things inflate and get ugly and get nasty. over Jason Calacanis (00:16:36): time. Saks as a free as a free market monster. What do you think, Saks? How would you approach releasing these drugs as a No. But you refer less regulation. When you see this regulatory mess of spaghetti and, you know, costs and and price scouting, you know, if we take the most cynical look at it. Because 15 million people times, David Sacks (00:16:55): $55,000 Jason Calacanis (00:16:57): here, I'm no genius at math. I but I my SAT has told me enough that that's gonna be this drug's gonna make, what, David Sacks (00:17:03): 10,000,000,000 Jason Calacanis (00:17:04): a year, 20,000,000,000 a year, something in that range. if they just get a fraction of those people. David Sacks (00:17:08): So, I mean, I I I agree with Freeburn and Chamath that we shouldn't give doctors an incentive to choose one treatment or another. Right? I mean, that just seems totally warped. But going to the sort of larger issue of FDA approval, I would make it a little bit easier to to get drugs approved. I mean, look. I I think that, you know, double blind tests is the gold standard. If the drug clearly doesn't work, you don't approve it. But this is a case where The evidence is a little bit inconclusive. And in a situation like that where it's a drug that might help people who are facing a deadly disease, And the you know, Alzheimer's is one of the worst. It's not only, you know, event the prognosis is terminal, but it also is deteriorating. And it's devastating for patients and their families. These people have nothing to lose. And so I would let the drug through, I think, and then watch how it performs over the couple of years. They could always revoke the approval in 2 years. You know? In other words, almost consider the usage of the drug over the next couple of years as a stage 4 trial. you know, the the one group who's not complaining about this are patients. I mean, Alzheimer's patients want the ability to test this And generally speaking, I think we should give people who are facing again a terminal prognosis the ability to try these drugs. Jason Calacanis (00:18:25): Yeah. And and Friedberg, correct me if I'm wrong. The reason or maybe Shamaz, you're better for this. But just looking at the economics of this, taking care of somebody with Alzheimer's, And if you and it starts to hit people at 65 and people start living to seventy eight, eighty five years old, they need to have care. A person with Alzheimer's, the issue is not their ongoing maintenance in terms of their brain, it's their day to day life. They cannot be left alone. So they have to be either institutionalized or have home care. And then you're talking about a 100,000 a year. And and I think Medicare and some other people pay for that. So 55 k if the person can take care of themselves. David Friedberg (00:19:02): That's how pricing is done, Jason. That's exactly right. Jason Calacanis (00:19:04): Is that how they do it? David Friedberg (00:19:05): So pricing is typically done based on the long term cost benefit of their of the drug of the the to the to the paying system. So, you know, they'll take a look at like, hey, here's how much we're gonna benefit people or benefit the paying system. Therefore, we can charge that dollars for getting this drug. That's why today, you can go get a a CAR T therapy or something, you know, some sort of therapy that that is gonna be highly efficacious, and they'll charge you a $1,000,000. Or genetic there there there's a few that are getting approved now for genetic diseases. And that, you know, $1,000,000 one time fee because you get you get the treatment once it costs, you know, technically nothing. The COGS are 0 to make this stuff. you get that treatment. They charge you $1,000,000 because the long term care of the progression of that disease is so high that they can economically rationalize that. And so David Sacks (00:19:53): -- Jason Calacanis (00:19:53): Is that ethical or moral? David Sacks (00:19:55): On the pricing, can I just can you clarify one thing? So we're we're talking about it at $56,000 a year. That is true, but it's basically $48100 per shot. You get a shot once per month, and that costs $48100, and so you multiply that by 12, and you get to 56,000 number. Now It's $48100 to get this monthly shot an outrageous amount of money for what could be a breakthrough Alzheimer's treatment I don't necessarily think so. I mean, that is the sticker price. That's not what the patient is gonna pay. Right? The patient's gonna pay the $10,000 copay. But divide that by 12, you're gonna pay about $850 per month for what could be a breakthrough treatment. I mean, to me, the real issue is whether it works. And since it's since there are some positive indications, but it's inconclusive inconclusive, I would say tie goes to the runner here, meaning you can try it unless revisit it in 2 years and see if it works. Jason Calacanis (00:20:49): But but it wasn't a tie as far as scientists were concerned. So what is the disconnect there, Chamath? Chamath Palihapitiya (00:20:55): Because I think what they were looking for they no. But they were looking for a causal link And the problem is at some point along the way over the last few years, we started with the hypothesis that amyloid plaque was causal of Alzheimer's, And then we moved to a place where there was some correlation. And then we moved to a place where we said, actually, it may not do much of anything. But I actually agree with Saks. I think the FDA did something really novel here, which is that they applied an extremely aggressive free market approach. to a market that has been completely bereft of solutions. And so if you can create a $100,000,000,000 market overnight, I think it stands to reason that a lot of people will look at the increase in Biogen's market cap and the profits that Biogen can make over the next 10 or 15 years and say, I will attack that and do that cheaper, faster, better. It happens in every other market. I think the point here is that it probably shouldn't have been the FDA's role to create competition. But for whatever reason, whether it's how the capital markets in biotechnology are structured or the way that, you know, Medicare Part B kind of works and creates these odd incentives. we are where we are. And so I tend to think that it's probably better that this drug was approved. I also agree with Saks that In general, I think as long as you have a reasonably defensible safety study, we should probably be in the business of getting more drugs approved faster. And the reason is that it allows smart, clever, hardworking people to connect the dots in ways that right now we don't know anything about. Like, just like, you know, a random factoid to prove this point. Like, when you look inside, for example, of who wins a Nobel Prize, right, particularly in the fields of biology and chemistry, etcetera. You have people that are in their sixties seventies that win awards for research done in their twenties and thirties. So, clearly, people at some point when they are somewhat less jaded, you know, and somewhat more naive maybe, have the ability to really transform the world for all of us. And if you can marry that to economic incentives so folks that understand the markets can also be along for that ride, that, in my mind, I think, is generally better than a nanny state of babysitters. David Friedberg (00:23:12): I agree with that point. Jason Calacanis (00:23:13): I I think I think let me frame this to you in a question for you. Of those scientists on that board who voted against this, if their parent or spouse, God forbid, were suffering from Alzheimer's How many of them would take the drug out of Bullhorn? David Sacks (00:23:27): -- David Friedberg (00:23:27): my point is and and it's a point I was gonna make, which is everyone wants that lottery ticket. There's no downside and only upside because you're not paying for the lottery ticket. And so the way the system works in terms of paying right now, as a patient and as a doctor, I have no incentive to manage cost down. Right? All I have is opportunity in front of me. And so as we add more opportunity, it's we give everyone the ability to have a lottery ticket that potentially could cure their disease or could or, you know, make them kind of live forever or have a healthier state of being. you know, we are gonna see this proliferation of approvals that end up costing all of us so much that the inflation that we've already experienced in terms of paying costs for health care continues to climb. So the challenge is, like, you know, if we are gonna continue to operate a socialized model of medicine or even partially socialized where the government's paying some amount of of the of the premium or employers are paying part of the premium where the individual that's getting the treatment doesn't bear the cost, you're gonna end up seeing everything in slate because you're creating this incentive now. Companies are gonna rush in. They're gonna try and get 10 things approved. Everyone's gonna be taking an Alzheimer's drug in a couple of years. because there's gonna be so many available on the market. And none of them may actually be curing Alzheimer's. Maybe 10% of people get cured, 90% don't. But the cost is gonna be 1,000,000 of dollars, you know, per person for these treatments, and everyone pays that. I'm not saying that's necessarily a bad thing. You know, we need to have a proliferation of innovation. Certainly, the challenge is in the interim period, the inflation we've already experienced in healthcare, which is just extraordinary, will continue to climb if, you know, we don't regulate the actual market for pricing on these things. And on the other side, we pay all the bills, or there's some socialized pool to pay all the bills. You can't have it both ways. Chamath Palihapitiya (00:25:12): I'll give you the other side of the argument as well, which is the reason why this could be so valuable. Again, if you look back to what Jane Lockwood did Jason Calacanis (00:25:23): With was it muscular dystro? Yeah. Chamath Palihapitiya (00:25:26): in Duchenne muscular dystrophy, you know, for or Janet Janet Woodcock. Sorry. Pardon me. Janet Woodcock. But if you if you know anybody whose child has Duchenne muscular dystrophy. My gosh. What an incredibly debilitating disease? You would not want anybody in the world to have it. And, again, by approving that drug, what she did, I think, is something pretty incredible because now there are of the the number of companies that have again, come after that market opportunity because she helped define a market. 4 of them are already public just to give you a sense of it. And they're you know? And so the odds at least numerically are greater today than they were 4 years ago, and that was a, you know, potentially non efficacious drug that that frankly, though, had a had a legitimate safety study. Jason Calacanis (00:26:13): To your guess, Chamath and and Friedberg, David Sacks (00:26:16): 10 Jason Calacanis (00:26:16): out of 10 of those people on the FDA board would have a spouse or a loved one take because there's no downside. If you look at Biogen's market cap just to wrap up here, They added $20,000,000,000 in market cap in the 5 days since, you know, this announcement happened. So in terms of incentives, you gotta think every other drug company is saying, hey. I've got something that kinda sorta works, and it's really expensive. Can I get a free ticket now? Can I do this compassionate thing? Chamath Palihapitiya (00:26:40): It's just the former thing. Kinda sorta works and then, you know, Yeah. Jason Calacanis (00:26:43): Take off from there. Alright. Moving on to our next topic. Bezos has decided that he will be the 1st billionaire in space. three people are gonna be going to space in quotes on an 11 minute flight on July David Sacks (00:26:57): 20 2021. Jason Calacanis (00:26:59): Jeff Bezos in a promotional video on his Instagram, sprung this on his best friend, his bestie, his brother Mark, who agreed to go with him, and there's bidding of $3,000,000, I guess, to David Sacks (00:27:11): -- Jason Calacanis (00:27:11): It's up to 4.8, chief. Oh my god. 4.8 now David Sacks (00:27:14): -- Chamath Palihapitiya (00:27:14): Thanks. David Sacks (00:27:15): -- Jason Calacanis (00:27:15): on Blue Origin site. and just doing back of the envelope math, which I which I did last week when I heard this announcement. 600 people or so have gone to space. Some of them have gone multiple times. Blue Origin's done 20 some odd flights, 2 of which went south and probably would have resulted in death. So I think 5 to 10% of Blue Origin's flight flights would have killed. that we've made. So if we have been on them, but, obviously, they've made progress since then. 2 of the 120 plus flights that SpaceX have done, but none in the last 6 years, have had an accident, and, obviously, Virgin Galactic had won tragic accident as well. So Is this a wise idea and where would we put the percentage risk of ruin slash fatality Chamath Palihapitiya (00:27:58): on -- I David Friedberg (00:27:59): just I just wanna I just wanna do statistics for a second, Jason. Speaker 6 (00:28:02): Sure. David Friedberg (00:28:02): Yeah. Just because there were blue origin accidents in the past, doesn't necessarily mean that it has any bearing in predicting the few picture, likelihood of there being an accident because the data from the past is from different machines and different teammates Jason Calacanis (00:28:17): and David Friedberg (00:28:17): different processes. So I don't I don't think, you know, to your tweet and the controversy with your tweet and, you know, your your point now, I don't think you can necessarily look at the past. This is much more of a kinda deterministic conversation about, like, hey. Look. Here are the things we have done with our systems, and here's why we have a high confidence in this thing, you know, kinda working. Jason Calacanis (00:28:34): Which is obviously why people don't go on the first fifty rockets or 1st 20 rockets, whatever it happens to be. But statistically, it's it's not 0. So I guess the question is, is this a a wise move? And where would you actually put the odds at? Chamath Palihapitiya (00:28:46): But it could very well be 0 now. David Friedberg (00:28:48): Could yeah. You don't know. Right? We don't know how well their safety systems have been developed. I mean, we don't know how, you know, the I I don't know anything about this, but I'm pretty sure that if Bezos is a pretty smart guy. He's not going in anything that's gonna have some high some some even nominal likelihood of of death. Right? Like David Sacks (00:29:02): -- Chamath Palihapitiya (00:29:02): And he knows probabilities, and he's been there in the last 15 test flights, and he's seen the data, and he's probably seen a string of nominal flights. And at some point, you just feel like, you know, okay. This is this is really dialed in here. David Friedberg (00:29:16): My prediction is Bezos is gonna come back, and he's gonna announce that he's gonna be the CEO of Blue Origin. think this is what Jason Calacanis (00:29:21): he's going all in on blue artificial intelligence. David Sacks (00:29:23): -- David Friedberg (00:29:23): what he wants to do with the rest of his life. I think it's been pretty clear that this is such a passion for him and, like, you know, he's he's got the the world's greatest money machine ever. It's a flywheel. It'll run as a monopoly for decades. He can do whatever he wants to do now. And so when he takes a look at this, what's greater than after you've conquered Earth than leaving Earth than moving on. So to to me, this seems to be so intellectually interesting to him, and and so kind of existentially interesting. My guess is he goes in full time on Blue Origin now that he's kinda transitioned to the chairman role, and he's kinda been pretty public about it. David Sacks (00:29:53): 100%. 100%. Jason Calacanis (00:29:55): David? You're conservative and typically very scared of anything, Davis. Go ahead. Give us your conviction. David Sacks (00:30:01): Well, I'll get Bezos credit for dog fooding his own product. But to to be I would take a contrarian view overall. You know, I think sometimes people get so rich and so powerful that there's no body around them to tell them when they have a bad idea. And quite frankly, I think this is a brain fart that the people around him are telling him smells like perfume. And they should be telling him, dude, what are you thinking? You know? If If Jay Cal said to me he was going up on a rocket, I'd be like, dude, you got at least 30 good years here. You know? Bezos Jason Calacanis (00:30:36): Don't screw up the podcast. Yeah. We need the host. David Sacks (00:30:38): We we need you down here. Like, we're just thinking. Bezos has got, like, a 170,000,000,000 after the divorce. He's, you know, still a young guy, and he's gonna risk it to go up in space for, like, 3 minutes. I mean, now yeah. They've this is the they they have sent the crash test dummy up there successfully fifteen times. But this is the first manned flight. The first fly with humans on it. He's determined to be on it. If I were his adviser, I would say put a GoPro on the head of the crash test dummy and experience it in virtual reality. have a chat. You're gonna be safe on it. No worries. Exactly. What are you thinking? Jason Calacanis (00:31:18): Yeah. I mean, if this was a stunt that, you know, Richard Branson did early in his career, remember he did the ballooning things, and he was trying to become a billionaire and trying to get excitement around his brand. But I I think this is totally unnecessary. And it is not a the the risk of Ryanair is not David Sacks (00:31:36): 0. Jason Calacanis (00:31:36): It might be close to 0, but it's definitely not 0. I mean David Sacks (00:31:39): -- Well, now Branson's trying to beat Bezos into space. So he's announced he's gonna go up too. And, you know so these guys are both being daredevil. David Friedberg (00:31:49): Is he going up on the galactic Timoth? he do how's he going up this space? Is that a virgin galactic flight? What what Chamath Palihapitiya (00:31:59): do you want me to tell you? Jason Calacanis (00:32:00): Of course. My I'm also churn to the board. What do you all tell you? You have a company here on the board that does space flight. I didn't know David Friedberg (00:32:07): if it wasn't public. Is it you're saying sorry. Did you say it was a public thing? Chamath Palihapitiya (00:32:11): No. I said, idiot Virgin Galactic is a public company, of which I'm chairman of said board of directors. I'm not saying anything about anything. David Sacks (00:32:18): Branson is is trying to beat Bezos into space. by going up before him. There it's now a space race going on. And you have to wonder. And then meanwhile, Elon, I I wonder how much of this is because of Bezos's pride because Elon tweeted that Bezos couldn't get it up because his rocket Bezos's rocket is only -- Does it Jason Calacanis (00:32:39): go to actual space? Yeah. It David Sacks (00:32:40): goes to, like, suborbital, like, low earth orbit. You know, spaces -- -- gets Jason Calacanis (00:32:44): it halfway up. I think he's somewhere in the 50 to 70 range. I think if he if he had a little blue pill, blue origin. If he got the little blue origin pill, he might to a David Sacks (00:32:55): 100%. David Friedberg (00:32:55): How great is this space race, by the way? This is so freaking cool. Right? I mean, like, the government comes in. David Sacks (00:33:01): -- Chamath Palihapitiya (00:33:01): pretty amazing. David Friedberg (00:33:01): I mean, the government creates all these great contract incentives. This is this is a good role for government. Right? They come in. They create all these contract incentives. SpaceX, they make all this money from the US government. And then they take that money and they invest in creating this space race, this industry that, you know, could absolutely transform humanity for the centuries to come it it really speaks to kind of like how semiconductors and computing came out of the space race of the mid 20th century And we could see this kind of, like, next industrial age arise for the space industrial age because of these incentives that have been created by the government. It seems to me like there's a good role here governments played, and this is super super cool. Jason Calacanis (00:33:38): Isn't this in stark contrast to the government doing the space shuttle program, which If you look at the fatalities, there have been about 30 fatalities in going to space 14 of which were on the 2 shuttles, one that tragically blew up on the way up and one that disintegrated on the way down in our childhoods in the eighties, I believe, for most -- And David Sacks (00:33:56): it was also incredibly expensive. Look. This is privatization for the win. Right? Instead of having the government doing all the r and d, and the government is good at some things, but r and d is not one of them. So you you let the private sector do the r and d and the NASA's contracting with these private sector companies. Chamath Palihapitiya (00:34:15): The government is a phenomenal balance sheet. David Friedberg (00:34:17): Yes, Zach. How do you feel about the government funding this work? Right? Because they're not doing the work, but it's the taxpayers money that's going to SpaceX and others for contract services that ultimately fuels this innovation engine? Do you feel like this is a good role for government spending? Is to kind of -- Well, David Sacks (00:34:32): the question the the question for government as a policy matters, whether we wanna go to space. And then the question is how do we get there? I definitely believe that if we believe it's important have a space station to get to space to kind of advance the frontiers of, you know, humankind Yep. Then then then it's a it's a worthy program to fund. And then the question is, well, how do you get there? And I think, you know, funding SpaceX and these or it's not funding. It's tracks with SpaceX to deliver the product is a much better idea than having the government try and develop it itself. Right? Jason Calacanis (00:35:06): Yeah. Because those are milestone based with some level of competition, even if people might complain about the bidding process, etcetera, the contract is for a duration of time and for deliverables. If the deliverables are not bad, or the contract expires, then we start the whole process over again. And this correct me if I'm wrong, is a must do for us because we cannot let the Communist and authoritarians own space. We have no choice being the Democratic west of owning space and getting there before them and dominating space. Chamath Palihapitiya (00:35:36): Nobody can own space, but I think the United States is an incredible balance sheet. Jason Calacanis (00:35:42): Nobody can own space. I mean, are you kidding me? What if somebody gets up there who decides to put nuclear missiles up there and decides anybody else who puts satellites up there, we're gonna just nuke them and laser them. Chamath Palihapitiya (00:35:53): You're not gonna own it. David Sacks (00:35:54): You don't even need a nuke, quite frankly. You could drop a tungsten rod from space Okay? Just a like a giant steel rod. And by the time it hits the ground, it's going so fast that it basically can blow up or assassinate anybody. David Friedberg (00:36:09): This is not what the hell are the David Sacks (00:36:10): 2 Chamath Palihapitiya (00:36:10): of you by Nina, have the 2 of you become -- No. David Sacks (00:36:13): This is real. Chamath Palihapitiya (00:36:14): Like, the 2 of you are like that like, be Arthur and the golden girls. Jesus Christ. Jason Calacanis (00:36:18): The guys in the muppets on the Chamath Palihapitiya (00:36:20): the planet can and be Arthur here blathering on -- No. David Sacks (00:36:23): The military application. You face are very important. Jason Calacanis (00:36:26): Have you not seen the Chinese putting rockets over Taiwan in military exercises? These people are not -- Jason. David Sacks (00:36:32): -- Jason Calacanis (00:36:32): playing games. Chamath Palihapitiya (00:36:33): Jason, I I understand. Nobody no. All I'm saying is there's no owning it. Okay? It's too vast. It's effectively infinite. You can't own it. Okay? you can have certain areas where maybe you can David Sacks (00:36:45): -- -- Jason Calacanis (00:36:46): it. You David Sacks (00:36:46): -- Jason Calacanis (00:36:47): Yeah. -- it can dominate space. -- you can dominate space. Chamath Palihapitiya (00:36:49): I would take Jason Calacanis (00:36:50): care of that. They don't play by the rules. mean, did you guys not see what happened with Hitler in Europe? He dominated Europe, Jason, a number of years. Chamath Palihapitiya (00:36:56): Jason. Listen. Listen. Evolve parts of space that you can dominate maybe the one planet is Uranus. Other than that, there's nothing like David Sacks (00:37:05): -- Jason Calacanis (00:37:06): You guys are so naive about the intentions of Russia and China. It is phenomenal. They have a 100 year plans to dominate humanity and they are willing to put millions of people into concentration camps. They have no problem going to space and deciding we're gonna own the satellites we're gonna knock other satellite satellites out of David Friedberg (00:37:26): the sky. I can't believe you were so anti Trump and and and and that's unbelievable. It's just you're you're so funny. Yeah. Chamath Palihapitiya (00:37:31): You're so funny. Can I just say one thing? I think back to what we said before, the US is an incredible balance sheet. And what Friedberg said is so true, which is like coming out of the Apollo program, we really created so much technological innovation. It propelled the US forward. We unfortunately gave a lot of it up, but, hopefully, this time around, we can do it again. And by the way, just last week, I guess it was or I guess it was last week or a month ago, you know, we're we we got that chips act in play, which is a quarter trillion dollars, you know, for semiconductors and other things. So we're slowly getting there, but this is where the US can do a lot of good, which is just to act as a funding source. and then let private markets kinda take over the restaurant. David Friedberg (00:38:10): By the way, we've talked about this on the past couple of podcasts, but there is, I think, $90,000,000,000 earmarked in this new bill for enabling American manufacturing progress. And so it it will be through a similar sort of funding mechanism it looks like as what we're seeing here, it could be a a fantastic boon for innovation and and infrastructure. I was trying Jason Calacanis (00:38:28): to say, what other categories should we model this after Saks? Should we do this for nuclear? Should we do it for education for housing. David Sacks (00:38:34): Before we move on I mean, look, Jake, I wanna come to your defense on this point because I think it's it's because I think it's just wrong to say that there aren't, like, vast and important military applications of space. The fact of the matter is you look at the history of warfare, it's critical to have the high ground. Whoever has the high ground ultimately wins the war. This is why -- Greeks. -- the first thing we do, the Greeks Greeks have the high Yeah. Jason Calacanis (00:38:58): I'm not a lifter. Chamath Palihapitiya (00:39:00): says the guy that's 5 foot is David Sacks (00:39:02): 3. Chamath Palihapitiya (00:39:02): He says the guy that's 5 foot. Let's see here. Jason Calacanis (00:39:05): You haven't seen me with a smearing shield or a mace. David Sacks (00:39:08): Let me finish the point. The first thing we do in a in a war or a conflict is establish total air superiority. It's the reason why our inventory doesn't take massive losses. It's you know, we wanna establish you know, artillery that that sort of protects the infantry. Look. The future artillery is gonna be from space. It is the ultimate high ground. It I agree with Jake Hall. It's naive to think that the other side that the other powers are not pursuing military applications We have to have the ability to defend ourselves against space based attacks and to have those those abilities ourselves, those capabilities. And so that is part of what's factoring in here with the space -- Chamath Palihapitiya (00:39:51): I get it. I get it. I know what you guys want. A giant laser. What a Jason Calacanis (00:39:55): child laser in space? David Sacks (00:39:57): I don't I don't think it has to be a laser. I think it can be low tech. You know? Jason Calacanis (00:40:01): Well, I mean, just touch. You just literally shot Paul back. -- other satellites, it would rip through them. Right? David Friedberg (00:40:06): I mean -- The tungsten rod program is an actual program. Right, Saxon? Jason Calacanis (00:40:09): It's a yeah. David Friedberg (00:40:10): Yeah. It's a funded military program. Chamath Palihapitiya (00:40:12): Oh my god. David Sacks (00:40:13): By the time you if you drop something from space, it hits the ground at, like, Mach 35. Chamath Palihapitiya (00:40:17): Phil Hellyers has invaded our podcast and taken the body of David's side. Jason Calacanis (00:40:22): No. But in all seriousness, this program that we're seeing great success with, inspiring the greatest, you know, entrepreneurs of our time, to go after big prizes like this, could we not do this with nuclear energy, housing, and education, or are is that kinda out of the question Chamath Palihapitiya (00:40:39): because if you use David Sacks (00:40:39): -- David Friedberg (00:40:39): Let me just point out, by the way, the things you just pointed out are the things that are now most regulated. And it's the regulatory burden, which ultimately stifles innovation, whereas in this case, we're enabling innovation without putting a lot of regulatory burden on space at this stage. Right? And so as soon as ICAR, which is one of these regulatory bodies starts to step in and maybe we start to limit things that can be done in space and so on and so forth, you may see things kinda get damaged like nuclear energy got damaged because the fear of the downside ends up, you know, kind of counterbalancing the opportunity of the upside. and it's something we've seen time and time again with every innovation cycle in every industry. And it you know, you're right. Right now, we're in this opportunistic moment in the space race. But as soon as kind of the regulatory burden becomes heavy, you're you're gonna see the same thing that happened with housing, the same thing that happened with nuclear energy and all the other kind of innovation cycles. that that that kinda got stifled not just in the US, but globally. Jason Calacanis (00:41:34): Yeah. So we don't think for nuclear, we'll see this happening anytime soon. Man, that would be an incredible David Sacks (00:41:40): -- Nobody nobody wants nuclear if there's a huge nimby problem with nuclear. Right? Which is who really wants a nuclear power plant in their backyard. I mean, not gonna happen. I don't think it's realistic. It's it's one of these ideas that, you know, sounds great in theory, but then in practice, no one's willing to raise their hand and say, I want that advice. -- Jason Calacanis (00:41:58): a really easy solution for that. Why don't you just make anybody who has to live within x zone of a nuclear power plant have attacked credit of a $1,000,000 a year. David Sacks (00:42:06): They still don't want it. Look. I think the future of alternative energy is solar. It's it's an inexhaustible supply. the cost of solar Jason Calacanis (00:42:16): panels -- -- enough. David Sacks (00:42:17): We can't we can't get it out there. Fast enough. -- keeps going down exponentially. The cost curve is going down exponentially. And, look, ultimately, all life on this planet is solar powered. Right? Because fossil fuels come from the remains of dead dinosaurs who were ate plants and plants are solar powered. So, ultimately, the sun is the ultimate source of energy, not wind, not nuclear, not windmills. David Friedberg (00:42:40): What geothermal? David Sacks (00:42:41): It's gonna be solar. David Friedberg (00:42:42): geothermal capacity is still, like, a 100000000000 years based on our current consumption rate. But there there's limited research relative to the opportunity in geothermal. But, yeah, totally agree with you, Saks. Jason Calacanis (00:42:55): In a microcosm of, you know, the reopening of the pandemic, we've been record low case loads, and deaths are so low now from COVID 19 in the low hundreds that it's probably hard to know. Friedberg, you tell me if I'm wrong or right. If people are of those David Sacks (00:43:12): 3 Jason Calacanis (00:43:13): or 400 people dying a day, that's with COVID from COVID, etcetera. But anybody I think it's intellectually correct to say that anybody who over the age of twelve who wants a vaccine could get it and anybody who's in a high risk group certainly now has had over 6 months to to get a vaccine. So we're basically done, and now the question becomes what happens to society? Are we gonna go back to work? Apple employees wrote a letter about Apple's demand using air quotes here that people come back to work 3 days a week, Amazon, just adjusted their return to work policy backing off their claim of in March that they're gonna return to an office centric culture They announced that employers can do 2 days remote, 3 days in the office. That seems to be the 3 for 2. Google has a similar policy. They're expecting people to return to the office 3 days a week in September. Twitter said you can work from home forever because Jack is an introvert and doesn't wanna come back to work, I guess. Facebook employees either need approval to continue work from home full time or they will need to be back in the office 50% of the time, but Zuckerberg personally said that he is embracing remote work. Here's the quote. I found that working remotely has given me more space for long term thinking and help me spend more time with my family, which has made me happier and more productive at work, which I guess is either devastating for real state or this is a great negotiation that's going on. You had some choice quotes about Apple employees doing David Sacks (00:44:43): 3 Jason Calacanis (00:44:47): letter slash petitions in 3 weeks? David Sacks (00:44:51): Yeah. Yeah. So look. I I I don't have a problem with the work from home policy. My my problem is with the fact that the Apple employees keep doing they do, which is sign these petitions and, of course, the it's all the snowflake language around. We're not being listened to. We're not being heard. You know? And then they wanna dictate to management the way that the company should work. And so they've circulate petitions to get other employees fired. They've circulated petitions to make Tim Cook take a stance against Israel. Now they're circulating petition on work from home. And, of course, that is what Apple employees do. And Apple Management is doing what it seems to do, which is cave to these petitions every time. And so they're in an infinite loop where the employees have realized they can run the company by forming these these sort of boycotts and petition mobs, and it's working. Now my again, my objections not to work from home, most of my portfolio companies are now working from home or fully distributed. They're hiring employees everywhere. It's been very liberating for them to be able to hire talent anywhere in the world. And so I think the work from home question the the reason why these big companies are struggling with it, I think, quite frankly, is this because this is about their ability to supervise their employees. I think that work from home makes the best employees better, but it allows the worst employees to hide. And I think what this really comes down to is a fear on the part of Apple and Google and Facebook. They've got thousands of employees who aren't really working and are gonna be able to completely hide. And and I think that's what this policy comes Jason Calacanis (00:46:25): down to. -- of man or just the nature of work -- This is the David Sacks (00:46:28): nature of these gigantic companies where they've got so many employees that they're trying to figure out how to supervise them all and make sure they're actually doing work. There's this funny tweet that's going around. I don't know if it's true or not, but it got retweeted about somebody saying that I've I've gotten 6 jobs during the pandemic. they're all work from home, and I'm waiting to get fired from them for, you know, people realizing I'm not doing anything. And so I think this work from home controversy ultimately is about the ability of these large companies to supervise a workforce that they don't know what they're doing, if anything. Jason Calacanis (00:47:00): Oh my god. What a brilliant idea. Chamath Palihapitiya (00:47:01): The big unsolved problem in the pandemic with respect to work from home is how do you onboard new people, in my opinion, Like, if you have an established company with established people where everybody knows each other, it seems like all positive to be able to work from home because there's There's decorum. There's social norms. There's all these things that were established together. But what happens when all of a sudden you introduce David Sacks (00:47:26): 1, 2, 3, 4, 5, 500 Chamath Palihapitiya (00:47:28): new people into the mix. How do you onboard these folks? How do you get and I think that's not a solved problem. And until you do that, I'm not sure that work for Moe will be as effective as it can be because I think you'll just get a lot of people that that languish a little bit as they switch jobs. Now maybe what that means is they'll switch jobs less because they'll just say, actually, this is net better. My crappy job got a little bit better, so there's no reason to move. The on your point of commercial real estate, Jake. I actually think it just brings the utilization down, but I'm not sure it destroys it because I think people need the physical plant. Now maybe over time, they'll get much smarter about getting smaller spaces and having flex spaces, so like things like WeWork do better. Because then you use that for overflow space, or that's how you how you actually have a primary outfit. But Yeah. Those are my thoughts. David Friedberg (00:48:17): Friedberg, any thoughts? I think it's gonna be hard to what I'm hearing I don't know if you guys have talked to a lot of CEOs But I I just hear it's kind of a little bit tough right now to find the balance of the rules around when to be in work because people have meetings in the off they'll have a meeting. David Sacks (00:48:35): 80% David Friedberg (00:48:35): of the people will show up to the meeting. 20% will be remote, and then it's a huge headache for everyone to be like, okay. We're all in the room. We're all having conversation. Now we gotta zoom the people in that aren't here. And this person decided not to show up today, and it's kind of become a little bit of a a weird photo or what it's the the the right word. -- faux pas, to come it to, Jason Calacanis (00:48:52): like -- -- Fox Poe. Right. David Friedberg (00:48:54): To to not come into work while everyone else is meeting in person, and it's becoming a little bit of a conflict across the organization right now. There's gonna it's gonna be sticky for a while. I'm not sure that it's gonna be a great solution, and it's gonna vary by company. Also, it's very different. As you guys know, when, you know, when I was single in my early twenties working at Google David Sacks (00:49:13): -- Chamath Palihapitiya (00:49:14): Uh-oh. Here it comes. Uh-oh. David Friedberg (00:49:15): Well, no. It was, like, it was it was going to work. It was, like, it's cool here. Chamath Palihapitiya (00:49:19): It's just, like, boop boop. David Friedberg (00:49:23): No. It was, like, it was cool. Like, it was a it was great to go to campus every day. Now that I'm married with kids, you know, like, being with being around your kids more often, you got obligations at home. It's very different. Right? Your priorities change. And so when you have a diversity in the workforce of people with different home lives and so on, Chamath Palihapitiya (00:49:39): What if you're married, but you don't know, and you have kids, but you can't remember their names. David overdue, sucks. Jason Calacanis (00:49:47): I mean, it But at that moment in time, correct me if I'm wrong, The Freightberg, you you know, Google was taking people out of Stanford, Harvard, MIT, whatever. And they were basically giving them another 4 years in college with this, like, college campus experience. David Friedberg (00:50:00): You got food. -- experience. It was fucking a freaking barista made your coffees. Anytime you want a coffee, you walk over to a counter, and there's a barista that he makes you whatever you want. You get all these amazing and you go you go down the sly to your meeting. I mean, it's like David Sacks (00:50:13): -- When you say it was great experience, do you mean that it was, like, fun for the employees? Like, it was, like, fun life experience, or do you think they actually got good work experience? David Friedberg (00:50:22): Fun life experience. Yeah. Yeah. It was a -- But it David Sacks (00:50:26): was, like, useless. It was useless from, like, a skills or, like, resume like, from a from building your career, it was useless. Right? David Friedberg (00:50:34): Well, the the work self was useful. At least for me, at least to that era at Google when it was a private company, I loved that work. It was an incredible experience for me. I made a lot of friends and and built incredible career experience working at Google when it was a private company. But what David Sacks (00:50:47): about now? I mean, Google has this reputation Chamath Palihapitiya (00:50:49): that David Sacks (00:50:50): there's thousands of employees not doing anything. It was satirized. Totally. By by the employees, on sitting on the roof of the show's Silicon Valley. Hulu. Yeah. Exactly. Like this Chamath Palihapitiya (00:50:59): up -- Hulu. Hulu. David Sacks (00:51:00): Yeah. So look. I mean, instead of sitting on the roof, they're gonna be sitting on their couch at home. know? That's right. Jason Calacanis (00:51:05): I guess I guess it's David Sacks (00:51:05): I guess it's an improvement. But I think that's really what it comes down to. What what Facebook said in its statement was kinda interesting. There was apart in there where they kinda implied that work from home would be like a perk, you know, and that high performers would get it. and then low performers would have to come into the office more. And that probably is the right approach because In order to let people work from home, you have to trust them to be much more self motivated to get their work done. And quite frankly, the employees who wanna hide gotta make those people come into the office. David Friedberg (00:51:37): You can -- It's like Chamath Palihapitiya (00:51:38): it's like in jail where the good inmates get thrown. David Friedberg (00:51:40): So -- Totally. Yeah. Absolutely. If you were driving the yard, Jason Calacanis (00:51:44): Yeah. So if it's conjugal visits David Sacks (00:51:46): -- David Friedberg (00:51:47): If you're running a 500 to a 1000 employee SaaS company based in Silicon Elli with offices around the country or whatever. What would you do right now? What would your your work from home policy be today? David Sacks (00:51:58): Well, most of my companies that are in that position are going fully remote fully distributed. And it is and and there are gonna be some challenges to be sure, but I just think it's inevitable. Now some of them, I I I do think there isn't a strong cultural advantage. We talked about this before, which Malthus made this point around having everyone in the same office or at least having hubs. So I am a fan of developing hubs. You might have, like, an engineering hub somewhere that you know, and then you've got some remote engineers. You might have, like, a customer service hub. I I I I do think that, like, call centers, for example, you're much better off having everybody work from the same Total center because that that is, like, a total productivity job where it's about, like, how many units of work can you do within a certain amount of time? It's way easier to measure and manage that work when it's all happening in one place. And and those call centers tend to be in locations that aren't as expensive as as the Bay Area. David Friedberg (00:52:52): At Metromile, we have a big customer service and claim center in Tempe, Arizona, and we have gone fully remote since the pandemic and productivity per unit per per employees gone up since going distributed because it turns out that, you know, I'm not I'm not gonna opine too deeply on this, but, you know, the the the throughput increases when people are kinda maybe distracted in the office or something. So David Sacks (00:53:16): -- David Friedberg (00:53:17): Oh, that's huge. -- you can actually track it. And and that that's a very measurable job. Right? So the throughput and everything can be measured. So I I would kind of make a counterpoint there that maybe we're seeing something different happen. David Sacks (00:53:26): Yeah. I mean, look. You you maybe you maybe you're right about that. I mean, it all comes down to do you have the ability do you have systems that can manage the the sort of sprawl. And if you do, I mean and you can really measure the output, and you can ensure the employees are delivering results, that's that's a win win. Jason Calacanis (00:53:42): I I created a a super lightweight version of this where since Slack is so dominant, I just tell people, you you need to have a start and end to the day so you can, like, get on with your personal life. Just at the start of the day, do an SOD, in Slack in the general channel. You just say David Sacks (00:53:59): 2 Jason Calacanis (00:53:59): or 3 bullet points of what you're working on today. And then at the end of the day, reply to that Same one with your EOD. Just what you got done today and then inform your employees, and then you don't need to be managed. So if you can do that for 5 minutes at the start of the day and 5 minutes into the day. And then on Friedberg, before you leave for the and close-up the week, give me an EOW of what you got done this week. And then on Saturdays, like, today, when we're taping this, I go through, have a cup of coffee, read all the EOWs, and I give feedback. And it has made it so clear who's a contributor in the company and who's not. And when I I instituted this pre pandemic, and I had two people quit because they were like, I don't wanna do And it turned out that those people were the lowest performers. David Sacks (00:54:41): I think you should call it a TPS report. Jason Calacanis (00:54:44): It you know, I I would you could frame it as such like micromanaging, and I said, you can either frame this as micromanaging, or you're setting an intention of what you're gonna do in your workout And then you record what you did in your workout since I started using the tonal system. And since I started using hydro, I'm not advertising them here, but they both have measurements And I I did £65100 on the tonal. And I'm like, I wanna break that record this weekend. I wanna do £7000. I wanna do 5 exercises. I went from doing 3 exercises, 3 reps to 5 exercises, 4 reps, and and that just makes me wanna measure it. Chamath Palihapitiya (00:55:19): If I if I do slash apple slices into Slack, do I get apple slices? Jason Calacanis (00:55:24): Absolutely. We will bring you you could also pick milk or chocolate milk or strawberry milk. Speaker 5 (00:55:29): What do you what did Chamath Palihapitiya (00:55:30): you guys think of that's press release that Salesforce sent out, which said something to be effective. Like, they are becoming an entirely Slack centric company. They're gonna rebuild, I guess, the entire architecture of SFDC around or Salesforce around David Sacks (00:55:43): -- Jason Calacanis (00:55:43): Of course. Chamath Palihapitiya (00:55:43): We predicted that on Jason Calacanis (00:55:44): the show. Slack is gonna be the the re they're gonna rename Salesforce, Slack. Chamath Palihapitiya (00:55:48): No. But really understand what that meant other than the actual headline of the statement. I'm wondering if you guys understand what it means. David Sacks (00:55:54): Well, I I think I understand what Benioff is getting at, which I saw an interview that he did recently where you talked about their quarterly results, which I guess were their best ever. It was, like, a fabulous quarter for them. What he talked about Benioff is very good at connecting products to larger societal trends. And the big trend that he's kinda hooking on to is this distributed work trend. And the way he described it is is, you know, basically, this is the future. Companies are trying to figure it out, but they need a saddle. because I guess this this is a trend that could sort of buck them off the horse. And he's trying to say that Slack is gonna be the thing that anchors your company now for this new era of remote distributed work. I think it's kinda brilliant marketing. Brilliant. Yeah. Jason Calacanis (00:56:34): Absolutely. I mean, there has to Chamath Palihapitiya (00:56:36): be a fair there. He's absolutely brilliant. He has built such an incredible organization. I mean, the scale of Salesforce. Over these last 20 years, my gosh, he is he is a star, star of stars. Jason Calacanis (00:56:49): I mean, in I sent you guys in the Slack the or I sent you guys in the Chamath, this socket site .com, which is a cool real estate site for San Francisco that's been around for 2 decades. I think. It's hilarious. They calculate how much open office space by how many Salesforce hours are empty in And it's 16,000,000 of square feet of vacant off space now spread across San Francisco. This seems to me, at the same time, we're having a crazy housing crisis. I don't know if you're monitoring this, but It turns out that banks and Hedge Funds and now Redfin and, you know, Opendoor and all these companies are buying homes homes are getting bid up. At the same time, mortgages are an all time low, and people are moving around. And we're not constructing. So I think we had a 60 or 70% decline in new housing being released into the market. And now we've got a a full blown housing crisis in the country Chamath Palihapitiya (00:57:41): I'm gonna go back, Otto and Lim, and put up my 10 year breakeven. I think this whole inflation thing is a head fake. And I think that the right now, we're in this weird position where the the home builders are not necessarily sure whether they're gonna rip in the capital necessary to build a bunch of homes. The reason they would slow down is if they think that inflation is coming, rates go up, mortgage rates go up and then demand falls off. But if it turns out to be a head fake, the builders will then actually build what's necessary. And they have the capital capacity to do it, but I don't think that they've had the economic justification and the courage to do it. And and in fairness to them, It's because the 10 year breakeven has gone straight up since the depths of the pandemic, which is essentially, again, just to, you know, get everybody up to speed. It's it's how the market thinks about the future forward inflation rate. Anyways, over the last 3 or 4 months or 3 or 4 weeks, sorry, since we talked about it, it's kind of steadily started to fall off. And I think there's a prevailing sentiment that, you know, we're gonna see some short term spikes we saw this past week in CPI. Energy went bananas. Right? The cost of energy, the cost of certain things. But then we're gonna get back to normal. And when we get back to normal, inflation will be okay. And I think, Jason, that's probably a solution because if it gets you know, if that if that Bookiman is actually not real and we put it away, then the builders will be back in size. And and Dale green light a lot of projects, and I think you'll see housing supply kick back up really aggressively. David Friedberg (00:59:17): That'll be good for us. David Sacks (00:59:18): Yeah. 22 points there, I think. 1, it so I I hope Chamath is right about the long term inflation, prognosis, It's been you know, it's it's it's very important for investment in growth companies, growth stock, and high-tech companies that the inflation the long term interest rate remains low. So I hope you're right. I think that ultimately What's happening is there's a battle going on between sort of a fiscal monetary policy coming out of Washington, which is highly inflationary and then technological deflation. So for the last 25 years, because we've had this explosion of productivity around technology, it's driven down the prices. of pretty much everything that's not where where the prices aren't set by the government. So health care, universities, things like that, the prices have gone up because the government's paying for it. everything else, the price has come down massively. So we've we were kind of in this battle between sort of government inflation and technological deflation. I don't know one's gonna win. I do think the the sort of the the the policies we're seeing, creating a lot of government debt and the Fed continuing on this never ending q e are are pretty scary. But in any event, I hope you're right about where this ends up. I think on the the other point was was sorry. What we we were on -- Jason Calacanis (01:00:36): We're talking about the housing and David Sacks (01:00:37): -- Yeah. The housing. So this is a a really interesting sort of populous narrative that's evolving where you've got I mean, it's I think both the left and the right can agree that it's a pretty scary thing that you now have major hedge funds buying up huge stocks of housing in the US, driving up prices So first time homebuyers can't buy a home. I mean, that is a very -- It's a nightmare. It's a nightmare. It's a nightmare trend. And I think you're seeing a reaction to it on the left that California now proposed some new policy where they want to stay in California to pay for 50% first time homebuyers houses, which just seems insane to me. But, you know, and then on the on the right, Tucker just did a segment coming down attacking BlackRock and these big hedge funds for for basically for for in for driving up the prices. So I think you're gonna see a unanimity on the populous left and right in reaction to these hedge funds. But the thing that no one's really talking about that they need to be talking about is the nimbyism. mean, Jason, you mentioned it. The reason why we don't have enough housing is because it's too hard to build. And Chamath is right that the builders could get the capital for it but it is too hard to get these projects approved. That is the thing we've got to that that is the change we gotta make. Jason Calacanis (01:01:54): To build on that, I think what's happening now becomes the catalyst to break the symbolism. If all these black rocks are buying up all the homes, if young people and young families can't buy a home, despite mortgage rates being ridiculously low and despite them having the money to do it and the desire to do it, then that's going to create a mass of societal of people, I believe. And then that's gonna either drive people to other states like Texas is benefiting because they're pro development. It's gonna catalyze the massive movement of people out of New York, out of California, whatever states are are giving too much red tape, it's gonna drive people to those states because that's where the housing people is gonna be Or those states are gonna crack under the pressure and say, you know what? We're gonna let you build in Sacramento. And, you know, you guys know I'm I have a housing company in my portfolio. And they are they are getting absolutely deluged with people begging them to do affordable housing in different locations, and the biggest problem they're having is sorting through all the projects. And what are we gonna do? But the great news is technology exists now to build modular homes in factories like Tesla does cars and ship them to site and take 6 months to a year out of the construction process So then it just becomes a matter of regulations and which state decides that they're gonna let people buy a home for the first time. And if California doesn't let people buy a home for a first time. Who's gonna pay taxes here? Where's the growth gonna come from? Chamath Palihapitiya (01:03:19): This is gonna be a this Jason Calacanis (01:03:20): is a stall moment, I think. Just just so you know, then the the other Chamath Palihapitiya (01:03:23): the other really terrible thing about homeownership is that it is where the preponderance of wealth creation for average Americans comes from. And so when you lock people out of homeownership, you're essentially ripping away 60 to 70% of how they're ever gonna make real wealth. And so yet again, you exacerbate Jason to your point. The inequality that we have where a few folks make all the money And then everybody else, they're kind of shut up from the equity market, they're shut up from private investing, and then they're shut up from owning a home, and no wonder people are pissed because it's like you throw your hands in the air. Jason Calacanis (01:03:58): It's like -- -- literally creating a revolution. You pulled up three ladders at once. You can invest You can't David Sacks (01:04:02): -- Chamath Palihapitiya (01:04:02): Tell me how I can just earn some money so that I can pay for my kids to go to college, take a vacation, and have a nice life whenever. Tell me how to do it then. Jason Calacanis (01:04:10): Yeah. because look. And Chamath Palihapitiya (01:04:11): and nobody has Jason Calacanis (01:04:12): a good surprise. Chamath Palihapitiya (01:04:12): Government doesn't have a good answer. Jason Calacanis (01:04:14): You you we're pulling up the ladder of home ownership. We've pulled up the ladder with a credit division. You can't invest private companies. We've made higher education far too expensive. We pulled up that ladder. I mean, what's left for the average citizen to to to grow their wealth? David Sacks (01:04:28): this is a crazy thing. We pull up the ladder, and then in response, government creates a program to subsidize people and bail them out at the end. I mean, it doesn't make any sense. I mean, Mike Solana had Mike Solana had a really funny tweet about the the California program, which was just amazing the lengths to which people will go to avoid building new housing, you know, new supply. It's like we subsidize homebuyers for this artificial price increase we've caused by limiting the supply. Jason Calacanis (01:04:54): is, like, eliminating people's student loans. David Sacks (01:04:56): Just allow supply and demand. Jason Calacanis (01:04:58): Yeah. Just make more colleges and make them cheaper. Chamath Palihapitiya (01:05:01): What do you guys think about this whole pro public speaking of an of wealth inequality, this pro publicly leak of tax records. Somebody inside the IRS or it was hacked, we don't know. Jason Calacanis (01:05:09): Yeah. This is clearly a person. Got a hold Chamath Palihapitiya (01:05:11): of basically David Sacks (01:05:12): 3000 Chamath Palihapitiya (01:05:13): the the tax records, many going back many years of 3000 of the wealthiest Americans. And Propublica has slowly started to digest and and issue news reports about them, and it shows that, you know, in some years, guys like Bezos paid no tax, whatsoever, were able to take huge deductions. You know, at one point, actually, Bezos in a year where we made, you know, kind of like $1,000,000,000 was able to essentially didn't claim he made nothing and then made so little or made negative that he got a $4000 tax credit that's typically reserved for people, you know, people people who David Sacks (01:05:51): -- Jason Calacanis (01:05:51): It was a tax charge for your kids. Yeah. It's it's not meant for billionaires, essentially. But, you know, the this was a lot I think the big story here is the leak more than capital gains how capital gains works. We all know how capital gains work. ProPublica has gotten an agenda, obviously. This is a left leaning investigative journalism funded by the left and donations, and they do a great job with investigations. But in this case, They're just telling everybody what we already know, which is if you have Giant Holdings, you can get a loan against them. Whether it's you own a home and you can get a mortgage against it or equity line, or if you own a bunch of stock, you can get a margin loan. I mean, it's not really news. I think this is, like, starting the pot. And the big news is, who who released this data? And then, you know, there are some countries. I believe Sweden is one of them where tax records are published -- -- published. -- top level. Yeah. They have to be published. And so I think the way the United States is going is we're gonna force people to publish their tax records, and we're gonna force some sort of minimum for people with holdings aka a wealth tax. And I'm not saying I agree with either of those, but I think that this is the way it's going. And somebody posted to our Chamath Palihapitiya (01:06:58): group tax. I'd be in favor of publishing. David Sacks (01:07:00): -- Chamath Palihapitiya (01:07:00): in more IRS agents are coming online. I'd I'd be in favor of publishing tax returns. David Friedberg (01:07:04): I I have no I Chamath Palihapitiya (01:07:05): I I I think that that's a really good idea. Jason Calacanis (01:07:07): That's a flax mosel? Chamath Palihapitiya (01:07:08): No. No. No. But I David Friedberg (01:07:09): I I think it's a Chamath Palihapitiya (01:07:10): I think it's a really smart thing to do. I think, like, you would see a lot less shady behavior if you had to publish this stuff. David Friedberg (01:07:15): When you publish your tax return Chamath, would you do a shirtless holding up your tax return in a mirror and take a selfie? And then that's how you would publish it or Listening a sweat? Yeah. Chamath Palihapitiya (01:07:23): More like that. More like a one tier one tier we're all linked out by Jason Calacanis (01:07:29): It should just be a picture of you with a wheelbarrow of cash just you dumping it into a furnace. I I think I think David Friedberg (01:07:35): I think one thing I'll say is I think these stories have highlighted just an incredible ability to to shift a narrative and create a different kind of dialogue around taxation. Because as we all know, the principle of taxation in the United States is that you are taxed on income. And income is a recognized game, meaning when you sell an asset for cash or for some other asset, Or you do a job or you do a job and then you get paid, you get that cash that you can now go use to go buy something or to to do whatever you wanna do with, That is the transaction moment that you get taxed on. And everyone's saying, well, this guy's a billionaire. He has these 1,000,000,000 of dollars. He paid no taxes. he didn't necessarily make 1,000,000,000 of dollars of income that year. His stock value may have gone up 1,000,000,000 of dollars, but if we all taxed each other when our stock values went up each year and we didn't get a rebate when our stocks went down, people would feel pretty upset. The average American, the average person would probably feel pretty upset if they got taxed every time their their stock portfolio went up, and then they didn't get to have a rebate when their stock portfolio went down. So the principle of taxation is such that when you sell those shares and you ultimately generate income, that's when you get taxed. But the narrative is very quickly shifting where people are like, oh, this guy's a billionaire. state stated, you know, he didn't pay the taxes. They don't say anything about how much income he actually made, and a lot of these guys don't need income Jason Calacanis (01:08:57): because -- They get a dollar salary. They pay they, like, you know David Sacks (01:08:59): -- David Friedberg (01:09:00): Well, they affect have a credit card. One way to think about it is wealthy people have a credit card, as Chamath pointed out, because they can buy everything on loan. They can buy everything they want on credit. because down the road, everyone knows you guys have 1,000,000,000 of dollars when Jason Calacanis (01:09:11): you are potentially paying -- -- consumption taxes on those. So if they do take the $1,000,000,000 in your body, did your banking motion be to be honest with you, Chamath Palihapitiya (01:09:18): it's even more it's actually even more perverted. So if you take a loan And then you use that loan to actually invest. The United States tax law says that all that interest you pay is deductible as well. And so the arbitrage that you find yourself in is if you have David Sacks (01:09:36): -- -- David Friedberg (01:09:37): the percent. Chamath Palihapitiya (01:09:37): Yeah. It's like you have these assets. You go to a bank, they'll they'll lend it against because they wanna you know, what is the bank's job? The bank's job is to generate interest. Right? So, you know, they want Jason Calacanis (01:09:47): you to -- -- big fish as customers. Chamath Palihapitiya (01:09:49): Right. And so and then and then part of the tax code is that it's tax deductible. And so it's one of these things that I think structurally gets people very confused about what's right or wrong, but it happens. And it happens Jason Calacanis (01:10:00): Is there any common sense solution, Saxx? Well, I was David Sacks (01:10:02): gonna say, just keep in mind that when somebody lives on a credit card. Like, one day that credit card comes to you. And it's not a problem for Bezos because Amazon's talks just keeps going up and up and up. But you will occasionally hear about some rich person going broke. And the reason is always that they took on too much debt. And then their stock price went down. And all of a sudden, they owe more than the value of the collateral, and then they're just done. And so you do yeah. Exactly. So you do take a big risk. -- liquidation. When you live on margin, you are taking a big risk. Most people don't do that. Most people who have gains will eventually cash out. They'll do that by selling their company or they'll sell a piece of their stock. They'll have a stock selling plan, and then they pay tax. David Friedberg (01:10:44): Exactly. And I I feel and so I feel like it's really unfair how look, I I don't wanna say it's unfair because people get really riled up when rich people aren't paying taxes. But it's interesting to me how the narrative has been kind of very quickly reframed without the specificity of the income that was generated by these individuals And they're just saying, look, this person has all this wealth. They didn't pay any taxes without actually recognizing that this person may have had an income generating event earlier in their life, which they did pay taxes on. or they will have an income generating event later in their life, which they will pay taxes on. And so the the the truth is a little bit more nuanced than I think you know, the very quick kind of sound bitey press stories kind of indicate. And it's it's just really it's been it's been really interesting to watch how many people get so riled up and frothy about this moment. And I I get that we all you know, everyone kinda dislikes wealthy people. You know, I certainly did when when, you know, I was I had no money, and I felt like getting screwed by the system. Jason Calacanis (01:11:39): You certainly did when we started this podcast now to be hot with SaaS. Yeah. David Sacks (01:11:43): Job, I bet you but but I think Friedberg raised a great point, which is that with Bezos take, for example. And look, by the way, maybe he should be paying more tax in other ways. But with respect to his Amazon stock, he built this machine called Amazon. It's this machine that makes all of our lives better for for the most part in terms of the delivery of goods and services You know? You press a button, somebody shows up the next day. So he builds this incredible machine. He owns a piece of it. He's merely holding on to his ownership in that machine. But the way that the public market is valuing, that machine keeps going up and up and up. But to Friedberg point, he hasn't recognized more income. He doesn't have more cash in his bank account. And so should he be paying Jason Calacanis (01:12:29): taxes in a year? Here's the thing. If you change the hold on. If you change the rule, Shamalff, correct me if I'm wrong here, and you said you you have to pay on the gain, then somebody who bought a house in 1980 and it appreciated a 100 x in California by the time they were 70 and they bought it in their thirties, they would get caught up in this wealth tax or paying for it as they go, the appreciation. Chamath Palihapitiya (01:12:48): This mechanism exists. Now, Jason, you said a key thing. This mechanism exists at all parts of the tax code. So, yes, ability to can basically go to JPMorgan or Goldman Sachs or Morgan Stanley, you know, get a margin loan on their stock and with their life. But individual folks who are not billionaires can do that via a HELOC on their home. And a lot of people do that as well. They take home equity lines of credit, and they use that to forward finance things as well. The difference is that because the quantums are so much bigger, you have this ability for rich people to accelerate their wealth creation in a way that normal folks don't. So I'll give you another So one example that I just spoke about is you basically take a loan instead of selling things. Right? You use that to make investments. All of that interest is tax deductible, number 1. Number 2 is even if you don't need to do that, you can just take a loan on a small percentage of your capital, reinvest that, again, pay the interest. And now you're running implicitly a little bit of leverage. And just to give you a sense of it, there's a really great study by AQR, I think, is the name of the hedge David Sacks (01:13:56): 1. Chamath Palihapitiya (01:13:56): And They reverse engineered Buffett's returns. And what they saw was that Buffett ran about 20 to 30% levered his entire career. And the way he did that was synthetically by the float of GEICO. The point I'm trying to make is even the best investors in the world prove that a small amount of margin and leverage is the key between being average and being the best in the world. And if that if he needed that Let's be honest, we all need that. And again, we all can't have that. It's only available to a few. And so I'm not saying that the rules are wrong, but the rules do Stifle, the ability to basically move up and move down that curve. It's clear how often people move down, people get stopped out, they get bargained out, happens all the time. It's very hard to see examples of people moving up. It's because it's harder and harder to get that first little bit of capital that then you can go and run with. Jason Calacanis (01:14:52): Yeah. And, see, I think the great the great reconciliation is what we need to work on as a society. And if you look at what the great reconciliation would be, It's can I get in great education? Can I get great health care? And can I have a nice home? And if you just said, we're gonna have health care for everybody in the United States, very easy to pay. And if you just said, we're going to allow the building of single family homes, 2 or 3 bedroom homes, and you cannot stop them. And any state that tries to stop them is not gonna get whatever amount of federal funding. And then finally, we said all trade schools are free. Those are three very simple things David Friedberg (01:15:25): that would stop. Chamath Palihapitiya (01:15:26): This -- What if happier, Jason. I love it. I what I can say was David Sacks (01:15:30): -- And and charter schools and charter schools and school choice for everybody -- David Friedberg (01:15:34): Yeah. David Sacks (01:15:35): -- because that is the number one thing to create the quality of opportunities in country. -- Chamath Palihapitiya (01:15:40): are incredible ideas, guys. David Sacks (01:15:41): And safe communities. Because the number one thing kids need is a great education and a safe household, and you cannot have that when -- And health care? -- and health care, you can't have that when gun violence is exploding across the country. Our communities are no longer safe. We have to fix that problem. Jason Calacanis (01:15:58): Alright. Listen, we're at 75 minutes. Do we wanna talk about toxic, Bitcoin, insanity, and Miami? Yeah. Where do Chamath Palihapitiya (01:16:03): we hell going on over there? What are these guys doing? Jason Calacanis (01:16:06): Alright. So very simple. There was a Bitcoin conference in Miami. If you go to that conference, you have to agree to not mention other cryptocurrencies there is a we all have heard of Bitcoin maximalization or being a Bitcoin maximalist. This means you believe that Bitcoin is the one true cryptocurrency see all other cryptocurrencies do not exist. This conference has codified that to the point at which people are jumping on stage like maniacs ripping off their clothes to reveal Dogecoin shirts. And then people are saying, Bitcoin maximalism now has evolved into Bitcoin which is a subset of the Bitcoin Movement. What Bitcoin toxicity says is in order for Bitcoin to become the one true currency, and the reserve currency, we must attack anybody who attacks it. In other words, cult like behavior. Either except Mohammed Jesus, Moses, whoever Hindi Hindu god, Zeus for the Greeks, you have to accept our god or else we're gonna attack you. So you can actually see this in practice. I tweeted if a if Bitcoin was replaced by technology, what would that look like? And you get massively ratioed on Twitter, which means more comments than likes. David Sacks (01:17:15): I'll take I'll take the other side of this if you want. Jason Calacanis (01:17:17): Yeah. Go ahead. Right. So Bitcoin toxicity is now a thing, and it's actually, I believe, making the movement toxic to people and people are not gonna wanna participate. So actually collapsing the project. People do not wanna be involved in toxicity, and people think that there's many ways to win in crypto. Chamath Palihapitiya (01:17:34): There are. Jason Calacanis (01:17:34): So crypto community because of the recent loss of David Sacks (01:17:37): 50%, Jason Calacanis (01:17:38): I think now is in a dead spiral of toxicity go sex. David Sacks (01:17:42): Well, I think this is a a fake moral panic on your part. Look. If toxicity means that you think that all these cryptocurrencies are scam, then Jason, you are guilty of toxicity too because you think Jason Calacanis (01:17:56): I believe in Bitcoin. I believe in Bitcoin. I believe in the court. I don't see what it's worth. David Sacks (01:17:59): Nobody has been on Twitter more saying that all these cryptocurrencies are a scam. The only disagreement that you and the Bitcoin Maximus have is with respect to Bitcoin. But you both agree. Both sides agree that you and the Maximus believe that all these other cryptocurrencies Jason Calacanis (01:18:13): are scammers. real technology. I do believe that there are scammers in it. to be clear. David Sacks (01:18:17): -- contributed you've contributed to the toxicity by basically -- Absolutely not. Jason Calacanis (01:18:21): I did not. David Sacks (01:18:22): By constantly denouncing every crypto David Friedberg (01:18:25): as a scam. -- ICOs and scams. Jason Calacanis (01:18:27): I believe technology. It's a real technology. But, anyway, it's it's it's just gross, and I think it's -- I Chamath Palihapitiya (01:18:33): think that in general, if I had to summarize what I see, I I see, like, there's a vein of young men, basically, who are super, super frustrated. And David Sacks (01:18:44): -- Jason Calacanis (01:18:44): In sales. Chamath Palihapitiya (01:18:46): And well, I don't know if they're in sales or not. But, like, you know, I think that they they basically I think, like, ran the race the way they were told. They checked all the boxes. They went to the schools. They got the jobs. They did the thing. They did the that. and it's kinda not working. And so whenever they find a thing that's new, I think they find acceptance in a community. And then, man, did they get really rigid about it? And they, in some ways, just stop thinking for themselves. And that's a shame. Call the cult. Yeah. David Sacks (01:19:15): Can I quote something? We've all been raised on television to believe that one day, we'd all be millionaires in movie gods and rock stars, but we won't. And we're so slowly learning that fact, and we're very, very pissed off. Jason Calacanis (01:19:26): Is that Fight Club? David Sacks (01:19:27): That's Fight Club. Jason Calacanis (01:19:28): Of course, it's Fight Club. David Friedberg (01:19:29): That's a Chamath Palihapitiya (01:19:29): great quote. It's so true. David Friedberg (01:19:31): So true. David Sacks (01:19:31): It's -- Yeah. -- Chamath Palihapitiya (01:19:32): true. That basically summarizes Twitter. I feel like Instagram -- -- Twitter. David Friedberg (01:19:36): It's Instagram. Instagram made it a hundred times worse. You could see everyday people suddenly becoming rich and famous or at least the perception. David Sacks (01:19:43): -- Jason Calacanis (01:19:43): using filters to look better. David Friedberg (01:19:44): And then everyone feels like they're being left out or everyone feels like they want something that they don't have, and then you're left in this constant state of want and desire and this constant state of unhappiness. So this isn't new, by the way. You know, these are Buddhist principles that DACA is source of unhappiness is really about desire. And if you can let go of and we create Jason Calacanis (01:20:04): more desire. -- comparing yourself to others. Yeah. David Sacks (01:20:06): I think there's a a a different answer to to the fight club nihilism than just sort of giving up all desire. I understand that sort of Buddhist approach. I actually wrote, in 1999, when I joined PayPal, I wrote an article called Silicon Valley's fight clubs in which I basically said that startups were the answer to this sort of you got remember, Fight Club came out in 1999. And so you had this sort of nihilism associated with this empty materialism. People wanted all these materialistic things, but it didn't really make them happy. But I think that creating something great And being part of creating something great is the answer to this. And it's about -- Absolutely. -- it's about creation. It's about purpose having meaning. Mastery. mastery. And we are robbing people of having that experience when we do stuff like universal basic income or or tell them they don't need to work. You know? We should be encouraging them to have these great experiences. And this is why I kinda react to these, like Apple Snowflakes who don't wanna come into their $1,000,000,000 spaceship campus. It's like You know, they're just punching a time clock. You know? They're not really getting any meaning out of their work. And that's the thing I sort of react to that's so So it's just Chamath Palihapitiya (01:21:18): so lumpy. You'd rather than find another place where they can actually find purpose in mastery rather than be it Apple, be mad, right there. David Sacks (01:21:26): Yes. Contribute. Jason Calacanis (01:21:27): Contribute. -- have been created by a remote team? Chamath Palihapitiya (01:21:31): It could let's be clear. The iPhone would never have happened had it not been for Steve Jones. Okay. Period and -- -- story. Jason Calacanis (01:21:37): You need to have the founder. Yeah. You need to have Chamath Palihapitiya (01:21:39): the founder. You just needed to have him. I mean, he could have been anybody, but he himself Jason Calacanis (01:21:42): if him with a remote team, could they have made the iPhone? Chamath Palihapitiya (01:21:46): No. I don't think so. I mean, I think Apple would probably be a different company. Steve, we're still here. Who knows? Jason Calacanis (01:21:51): Which is why I think they want people to come back. And I think what's happening here, I mean, I hate to be super cynical is I think a lot of people left the Bay Area didn't tell Apple because you're supposed to tell them if you relocate. And they're just trying to extend their tenure at Apple because there is no way to come in 3 days a week if you're living, you know, in Tahoe or further out. I mean, what are you supposed to do? Get a hotel for 2 nights a week and then drive back to Tahoe or Phoenix? I mean, these people have left David Sacks (01:22:18): If Steve were still around, those Apple employees be racing back to the office because they'd be so excited about what they're working on, they'd be working on new products, And if they didn't, if they didn't have that passion, Steve would have weeded them out in 2 seconds. Jason Calacanis (01:22:32): At the end of the day, all you have is Chamath Palihapitiya (01:22:33): Snowflake, by the way. You mentioned Snowflake, although you said Apple Snowflakes. But David Sacks (01:22:37): -- Jason Calacanis (01:22:37): The founder of Snowflake said in a CNBC episode, essentially, We care about diversity, but we care 1st and foremost about being a high performing organization, I'm paraphrasing. that services our customers and our shareholders. And so while diversity is important, we're gonna fill a role with the best person we can find. And so now The grand debate that has started is and I think it's related to what happened at Coinbase and Shopify with, you know, no more political speech at work is meritocracy And can meritocracy live alongside equity and equality and diversification? or diversity. So diversity and meritocracy in the same organization, which wins? Mike Moritz wrote this pretty fabulous, I say, it was in Chamath Palihapitiya (01:23:25): the financial times a couple of years ago. He got in a little bit of heat for doing it. But essentially, what he said was, you know, while we are all talking about the things that we think are important, there's an entire cadre of engineer in China that are coding 247. I think CMC said, like, 996 exactly. Yeah. David Sacks (01:23:42): 9 Jason Calacanis (01:23:42): AM to 9 PM days a week, and they used the same tea bag 3 times. And he used that to illustrate you know, he used it to illustrate their commitment to excellence. And what he used to see in Silicon Valley where people On the weekends, the parking lots were full. Keep going, Jamuk. Chamath Palihapitiya (01:23:56): But I I just bring this up because it's like we've lost the ability to have both things be true. Meaning, it's it's maybe like, at the end of the day, Frank Slutman, is a representative and a spokesperson for the values of a company that's a $100,000,000,000 company that's came out of nowhere and built something fabulous for people in a matter of a few years. I doubt that he speaks for himself only. Jason Calacanis (01:24:24): No. He specifically said in this comment, Shamal, that's who is speaking for other people who were too scared to talk about it. Chamath Palihapitiya (01:24:31): Okay. But I'm saying he but I'm saying he also he's but he's I don't care about other companies. He speaks for Snowflake. So to the extent he says that as the CEO of Snowflake, why can't we respect that an entire company has decided to do something. For example, you know, the other opposite end of this, do you remember this bakery? I think it was in Colorado that, like, you know, refused to make a cake. Yeah. It refused to make a cake for a lesbian couple. It went all the way to the Supreme Court, and they said that they this guy had the right to deny them making the cake. To me, it it makes my blood boil. But at least I live in a country where he has the right to have that opinion, and it's in within a legal boundary of reasonableness, I guess. Now I learn from that, and I say, okay. That's a legal boundary of reasonableness. And until that law's overturned, that's what it is. This is so much less than that, and we can't, you know, let this guy actually just go about his day without an issuing an apology. Jason Calacanis (01:25:27): Yeah. That's not the America Chamath Palihapitiya (01:25:29): we're living in. -- engineers that are working 996 in China, eating our lunch every day. Jason Calacanis (01:25:35): Yeah. I mean, in America today, I think. You have to you have Chamath Palihapitiya (01:25:38): to agree to another example. Jason Calacanis (01:25:39): I'll give you another example. -- to capitulate and agree to the diversity Chamath Palihapitiya (01:25:45): Jason, let me give you let me give you another example. There is a massive play right now going on in the uranium market. It was brought to my attention. I was like, let me just go look at this. I don't know anything about this, but I just was curious about what's going on. And, effectively, what it is there fund that was trying to basically corner uranium and drive the price up. And the entire thing about uranium, which was interesting, is, okay. What is it used for? It's used for nuclear reactors. Well, then you spend a little time understanding nuclear reactors. And I was shocked to learn how clean How safe? Yep. How reliable? How repeatable? I had all these stupid cobwebs in my head based on a random couple of press releases, 3 mile islanders of Fukushima, etcetera. So when I cleared all of that bias away and I learned about it, Then I'm like, why aren't nuclear reactors everywhere? Because it is the fastest way for us to get the carbon neutral And then I find out the same people who want carbon neutral, i e, Greenpeace, is the one of the largest advocates against nuclear. And I thought, how do we not, again, be in a position to actually hold 2 thoughts that are slightly divergent at the same time? We want nuclear energy because it actually supports something that's even more important to the sustainable ecosystem that Greenpeace is there to protect in the first place. and you can't have it. And to me, I find so I find all of this stuff. Again, add nauseam in this list of while we're all navel gazing on this bullshit. China is David Sacks (01:27:21): 996. Jason Calacanis (01:27:22): Right. We have to have 4 progress. And by the way, Slotman, he put out a release comments I made during a media review of last week may have led some to infer that I believe that diversity in merit are mutually exclusive when it comes to recruitment hiring and promotion. I do not believe this. I want to personally apologize to anyone who may have been hurt, were offended by my comments, so I've been added said in a statement posted Monday. I accept forward personal responsibility. for the lack of clarity in my comments. David Sacks (01:27:47): I think Slutman's apology actually only buttresses the original point he was making, which that CEOs are afraid to say what they really think. Yes. He came out. He had the bravery encouraged to say what he really thought. He then got piled on on Twitter, and now he's apologizing for it and walk me it back. It's really kind of a shame to Chamath point. How can we have honest conversations when people are just afraid to say what they think? Chamath Palihapitiya (01:28:10): Whether I agree with Frank Sloopin or not is not point. The point is that if his entire company and his employees and his executive team have made a specific decision that they view merit as, you know, incredibly important, and then they they layer diversity in as a result. Who am I to cherry pick those words? And all of a sudden, I have a wording issue with that because I don't even understand the hiring criteria. It's not as if he published those stuff. So it's not of not like anybody the outside had any shred of ability to know the details. David Sacks (01:28:40): Right. And and he and he yeah. I agree. And and here's my problem with all the people who attacked Frank on Twitter. is, you know, have any of those people said one word about school choice or charter schools, the needs to release the stranglehold that the education unions have on our kids. They're running these schools for the benefit of the unions, not for the benefit of the kids, They're abolishing advanced math, and how many of the people attacking Frank have said one word about that because if we want to achieve If we wanna achieve a quality of opportunity in our society, we have to fix the schools. And so it's so easy to attack Frank, but they're unwilling to say one word about school choice because the unions are a political ally and it's inconvenient for them to do so. Chamath Palihapitiya (01:29:26): What about, again, going and actually understanding the cleanliness and safety of nuclear and, you know, being able to tell folks on the environmental left that actually this is a path to sustainable energy and a better ecology and biodiversity in the shortest path possible. David Sacks (01:29:43): They just wanna shut down the conversation. They don't there to be any real conversation or debate? Chamath Palihapitiya (01:29:47): We're shutting down, to be really honest with you, words, and we're shutting down rather superficial conversations, and nobody ends up addressing the root cause issues of anything. That's the shame. I just think that we are screaming at each other about things that none of us really understand without taking the time to understand each other. Meanwhile, China is 996. I just can't say -- Which Jason Calacanis (01:30:10): is why we need to now you agree, Chamath. We have to win space. Chamath Palihapitiya (01:30:14): Meanwhile, China is 996. They're 996. And Jason Calacanis (01:30:18): they would only space and put -- You Chamath Palihapitiya (01:30:19): put 1,200,000,000 people that are born in a collectivist system against against holistically defined goals over a multi decade period of time, they're the only by the way, the going back to where we started just to end maybe the podcast, Biotech is the last bastion where America is completely dominant. Jason Calacanis (01:30:40): Right? Software too. Mhmm. Chamath Palihapitiya (01:30:42): Not really. There are incredible advances that it's it's been American Biotechnological ingenuity, through and through. And the question there is going to be, how do we make sure we wrap our arms around this category and continue to do great things? because in the absence of it and if we get again, if you lose the script, some other country is gonna 996 that market from us as well. David Sacks (01:31:05): Yeah. I think, you know, what you're pointing out is we're in this generational competition sort of sort of cold war type conflict with with China I think our foreign policy is starting to realign around that. You're seeing both Democrats Republicans really get on the same page now about the the threat that China represents. But our domestic policy is not realigned around that. If we really wanna win this cold war against China, we have to be competitive. And we keep doing things to our schools, our kids, and other parts of our system and our economy that are anti competitive. Jason Calacanis (01:31:37): We need more frameworks. You know? And if you get rid of the advanced programs, we have no Friedberg. We need to clone freeburg. Freeburg, what's the chances we could just clone you and have, like, 2000 more Friedberg to solve this biotech problem. Would you be open to that? Can we can we start the clone wars with you? David Sacks (01:31:53): -- David Friedberg (01:31:53): think you would get along with your clone, or would you wanna destroy your clone? Chamath Palihapitiya (01:31:56): destroyed. That's that's mimetic. So, you know David Sacks (01:31:59): -- Jason Calacanis (01:31:59): I want 10 clones of myself. Are you kidding me? Can you imagine the round tip? Chamath Palihapitiya (01:32:02): You know, Renee Girard wrote about this very eloquently many, many decades ago. This goes in one place, which is you know, it goes it goes into it goes into capital merger. Jason Calacanis (01:32:13): want a clone army of myself. Zach, would David Friedberg (01:32:15): you like to just sit down and play chess with your clone all day? Chamath Palihapitiya (01:32:18): Not chess, but he'd like to do something else. Oh, no. Wow. Jason Calacanis (01:32:23): No. That's not an image I wanted. Oh, no. You're gonna have a threesome with yourself? Chamath Palihapitiya (01:32:29): No. No. Nothing sexual. Let him know. No. No stuff. Jason Calacanis (01:32:31): story of what you were saying. David Sacks (01:32:32): I'd be cool with clones. So I'd I'd create Jason Calacanis (01:32:34): more You're dressing with your own clone? Well, you're resting, Matt? I feel like there's all these different things David Sacks (01:32:38): I wanna do in my life. the, you know, different careers or whatever. And I could send 1 Saks out to be an architect. Jason Calacanis (01:32:42): styles. Correct. David Sacks (01:32:43): One Saks could be an architect, and one could be a director, and one could be -- Chamath Palihapitiya (01:32:46): I wanna be a lawyer. -- one to a month to be a lawyer. David Friedberg (01:32:48): guys wanna have your mind blown for a second? Jason Calacanis (01:32:50): Yes, please. David Friedberg (01:32:51): Okay. So there's a concept capability called induced pluripotent stem cell where you could basically take any cell in your body and apply a bunch of chemicals to it and effectively get that cell to convert into a stem cell. What's it converts into a and so the the the copy of the cell becomes a stem cell? And this was this guy's Yaminaca factor. They they won the Nobel Prize for this. Now you could take that stem cell and turn it into an OVA cell, turn it into a effectively an an egg cell David Sacks (01:33:22): -- Jason Calacanis (01:33:22): A a fetus. -- and then you David Friedberg (01:33:23): could induce that fetus to start dividing based on a discovery that was made recently, which hasn't been done in mammals yet, but effectively get it to start dividing without being fertilized and grow up and it would effectively grow a clone. So this has been done in plants. It has not been done in animals. So in theory, in the next decade or David Sacks (01:33:40): 2, David Friedberg (01:33:40): we could take any any hair cell from our own body, convert it into a stem cell. This is totally by the way, it's not proven. There's no there's a bunch of there's a bunch of discoveries that have been made research that's been done that points to this trajectory that you could then take that stem cell from take cell from your body, turn into a stem cell, turn into an egg cell, induce it to start growing, and turn it into effectively Chamath Palihapitiya (01:33:59): a Crohn's cell. -- say you've been saying this -- -- have begun? I've been shaking my head. Jason has no reaction. Saks is grinning from. I mean, Genelwood. Sachs and stuff. David Sacks (01:34:11): Yeah. I'm gonna be like Saddam Hussein with, like, quote Jason Calacanis (01:34:13): to quote to myself. You're Do we try to match with -- Yeah. David Sacks (01:34:18): -- Jason Calacanis (01:34:18): clones of yourself in them. Chamath Palihapitiya (01:34:20): Just think of I love your best. Jason Calacanis (01:34:22): I love your besties. 4, the queen of Kinois, rain man himself, and the dictator. I'm Jake Al and this has been a double episode of the all in podcast. We'll see you on sign. Bye bye. Speaker 5 (01:34:38): We'll let your winners ride. Jason Calacanis (01:34:41): Rainman, David Sacks. Speaker 5 (01:34:46): We open sources to the fans, and they've just gone crazy with it. what airliners were like. Besty's our car. Jason Calacanis (01:34:59): I don't want 13. That is Speaker 5 (01:35:01): my dog taking it. I was driveway tax. Speaker 6 (01:35:06): Oh, man. I might have a casual media analyst. We should all just get a room and have one big huge order because they're all just useless. It's like this, like, sexual tension, but we just need to release them out. Jason Calacanis (01:35:17): What? You're the bee What? You're a thief. What? What? Where did you get Merckies are back?