OpenAI vs. Grok: The Race to Build the Everything App w/ Emad Mostaque, Dave Blundin & AWG | EP #199

Open AI Dev Day just occurred. Some of

the most staggering things in human

history got announced yesterday and they

still undersold it. Good morning and

welcome to Deb Day. The battle here is

that human attention is finite. Open AI

meta, everyone's making a play for who

are you talking to that then enables

these MCP enabled agents to come and do

the job. Everyone's trying to be the

everything app.

What happens when suddenly we're able to

5x 6x 7x the amount of broadly

accessible super intelligence across the

world? I I think this starts to become

the foundation for transformative

economic changes at a planetary scale.

OpenI is really trying to do a global

land grab, right? Going into India,

going into the UK, going into Greece,

and then you've also got all of the

open- source models coming out of China.

We're just at this tipping point and the

tipping point is in the next 6 months.

Now that's a moonshot, ladies and

gentlemen.

Everybody, welcome to Moonshots and our

next episode of WTF just happened in

tech. Uh we're spinning up this episode

real quick with my extraordinary

moonshot mates because Open AI Dev Day

just happened. Want to cover the

subjects there, but there's a lot

happening across the board in robotics.

you know, FSD 14.1 from Tesla just

dropped, as well as other robotic

updates and data center updates. Uh,

we've got my Moonshot mates Dave London.

Dave, good to see you, pal.

Good morning.

And of course, we have AWG live from

someplace in the uh in hyperspace. And

good to see you, Alex. Welcome back. Uh

and then uh one of our other moonshot

mates, Immad Mustach, coming in from

London. Immad, good morning to you.

Morning

or good afternoon as the case may be.

You know, in the rocket business in the

business, there's something called a

hyperbolic fuel. Uh a hypergolic fuel is

when two chemicals come together and

they explode and they make a propulsive

force. And I think about AWG and EMOD

coming together as my hypergolic fuel

this morning. So,

better than coffee. Completely agree.

Yeah. Uh, absolutely. All right. So, as

always, this is the news that's breaking

that I think is impacting the global

economy, impacting our mindsets,

impacting, you know, how we teach our

kids and run our companies. So, nothing

more important uh for me and let's jump

in. The reason we spun this up uh for

everybody is OpenAI Dev Day just

occurred. want to hit on this and I'd

like to really evaluate along the way,

you know, how critical, how rapidly how

is Sam sort of manipulating the future

of his company and AI uh in a positive

way. Um we're going to discuss this.

All right. Uh I'm going to open up with

a short video clip of Sam opening up

Open AI day yesterday. Let's take a

listen. Back in 2023, we had 2 million

weekly developers and 100 million weekly

touch BT users. We were processing about

300 million tokens per minute on our

API. And that felt like a lot to us at

least at the time. Today, 4 million

developers have built with OpenAI. More

than 800 people use ChateBT every week

and we process over 6 billion tokens per

minute on the API. Thanks to all of you,

AI has gone from something people build

play with to something people build with

every day. We think this is the best

time in history to be a builder. It has

never been faster to go from idea to

product. You can really feel the

acceleration at this point. So to get

started, let's take a look at apps

inside of Chat GBT.

All right,

Dave, you want to open up?

Yeah. So you obviously Sam's not, you

know, the best. He's not Steve Jobs on

stage, but the the numbers are just

staggering. You know, the 300 million to

six billion tokens per minute is the one

that really jumps out. And uh it's going

to explode from here forward too

because, you know, I could easily

consume 10,000 plus myself just coding

uh and with the number of developers

coming on board and the number of home

users coming on board, it's it's just

astronomical. So, as we've been saying,

nowhere near enough compute to keep up

with it. I think Johnny IV might be the

guy driving the hey let's do this Steve

Jobs style have our very first big stage

developer day. Uh you know their GPT5

launch was really flat. I mean really

really flat. They did a much better job

yesterday. I got to believe Johnny is

driving that guy. Put some money and

some effort behind it. Let's let's go.

It's but you know they some of the most

staggering things in human history got

announced yesterday and they still

undersold it

relative to the implications. We'll see

it in a couple other videos here. Uh,

but I I don't know if that's deliberate

slow playing because they don't have

enough compute to keep up with the

demand anyway or if it's just they're

learning how to do showbiz on the big

stage. But in any event, we'll see some

more just mind-blowing capabilities that

if anything are understated

and 800 million users uh is pretty

extraordinary. They're tracking for a

billion users. And I I just wonder is

this a winner takemost type scenario or

is there anything that can overturn them

the final result

let's go to you and then we'll go to

Alex to to uh bring us home on this one.

Yeah, I think to put it in context, it's

a lot, but it's about as many weekly

active users as Snapchat. And I know

which one's going to have a bigger

impact upon the world between the two,

you know. Um I I think there's still so

much upside to come from here, but now

you're seeing their model with Sora 2

and others moving maybe towards an

advertising model as tokens get cheaper,

as they get faster.

To put the token numbers in context, 6

billion a minute is three quadrillion

tokens a year.

All of the humans in the world together

speak 50 quadrillion tokens a year and I

expect that number to go up 10 times. So

next year OpenAI is probably going to be

at 30 and then by themselves the year

after they'll overtake in terms of

tokens all the human words spoken every

single year.

So this is the type of

I think that moment calculated. That's

really

I think we're getting close to that

because Google said they're doing a

quadrillion on their billion active

users right now because it's in search

and things. So, I think we're at that

tipping point now where the number of AI

tokens coming into the world is about to

overtake humans. And maybe the we should

call it a something day, right?

Quadrillion here, quadrillion there.

Yes.

Quadrillion here, quadrillion there.

Yeah. Alex, what's your take on this

opening commentary?

Yeah, I think we're really far from

saturation. So um I I I would add that

in addition to being call it at about 6%

saturation by comparing number of open

AI generated tokens versus human spoken

tokens uh per minute. I I think there's

probably an even more important

statistic which is that there are

approximately 4 billion human users of

smartphones that aren't yet using any

sort of super intelligence if you will.

Now ask yourself what happens when

suddenly we're able to 5x 6x 7x the

amount of broadly accessible super

intelligence across the world. I I think

this starts to become the foundation for

transformative economic changes at a

planetary scale

and you're limiting that to humans and

of course humans might be the least

significant users of super intelligence

in the final result.

Well with full autonomy super

intelligence is arguably the ultimate

user of super intelligence. Yeah,

there's a limit to the number of words

we can say. You know, it's like 20,000 a

day. Our thinking tokens are 200,000 a

day. AI has no limit to the number of

tokens and economically valuable tokens

it can do except for the GPUs. That's

the only limit.

Well, you know, on our last podcast, we

we talked about, you know, Sam was

saying we're going to have to make a

trade-off between tokens used for

education for our children or token used

for healthcare to save lives. But we

can't. We don't have an infinite amount

of compute. and I don't want to make

those difficult decisions. But if you

know FSD is coming online and all these

cars are going to start driving

themselves and the the quality of the

driving is directly tied to the amount

of compute available. So we're

imminently going to make very very

difficult decisions around, you know,

tolerate a very rare car crash versus

give somebody the ability to build

something at home using AI. I just

incredible the the difficult decisions

that are coming immediately after all

these functions that we're about to see

get deployed. and at the same time also

limited by energy which we'll talk to um

in this conversation. I'm going to move

us to a few of the features the open AI

day we'll see a few things. I I didn't

show the video here but one of the

primary uh you know high points was

they're talking to apps within chat GPT.

They have an uh an apps SDK and the

ability for them to say to booking.com,

book me this trip or Figma, you know,

diagram this or Cera, teach me this. Or,

you know, just speaking to Zillow, it's

the ultimate interface with all the

other apps out there. Uh what's the

significance on on this for you, Emmad?

Well, I think attention is all they need

as it were. Like the battle here is that

human attention is finite and so open AI

meta everyone's making a play for who

are you talking to that then enables

these MCP enabled agents to come and do

the job. What is the 10 cent WeChat type

super app that's coming together because

everyone's folding themselves into these

nice kind of things and again that's how

they're going to try and monetize. So

you'll see this battle between Meta via

WhatsApp, Instagram, things like that,

Google and Open AI to try and occupy

that real estate. And then of course

Elon's going to come in with X and all

sorts of interesting things coming.

Everyone's trying to be the everything

app.

Yeah, for sure. Dave,

well, in a second we're going to see

actually something built by voice. Why

don't we look at it and and then we can

It's actually really cool when you see

it.

The code the codeex example.

Yeah. Yeah.

Yeah. All right, we'll we'll come to

that. But before I mean, I'm just

wondering, you know, when OpenAI drops

this capability, are they picking

winners in the final result? Are they

going to be equally uh you know, sort of

spreading their attention across

everybody? Uh and are they basically

eating away all the entrepreneurial

startups? There was a there was a tweet

that went out. I was trying to capture

it but it said okay Open AIJ just

eliminated you know a million different

startups out there working on on their

approach.

Remember every platform ergonomically

wants to have its own app store. So I I

think that the notion of an app store

being built on top of a new platform

where chat GPT and then presumably other

frontier models as well wanting to

become the new operating system or it

certainly rhymes with Facebook platform

moment when Facebook launched that as

well. I I think that that's a very

natural market movement. But I would

also perhaps caution at at some point I

think it's reasonable to expect that

every pixel is going to be generated.

It's not just going to be vector art uh

or HTML type graphics. Every pixel is

going to be generated. So I I would view

this as almost a transitory moment where

apps are floating on top of chat GPT as

the new operating system environment,

but it's a passing phase. at some point

every single pixel probably wants to be

generated. That that was my first

thought. The other thought is do you

remember Peter back in 1987 when Apple

without Steve Jobs launched their

knowledge navigator concept?

Yes, I do. I mean

we're living in that now.

Yeah,

we're living in that where you know

professor is having a conversation with

uh basically similar type canvas that is

able to pop open new apps and interact

with them on demand. We caught up with

the future approximately 40 years later.

We're living the knowledge navigator

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before anyone else. All right, now back

to this episode. One of the examples

they had here, they on their on their

demo live stage, they had an individual

propose a new startup. In this case, it

was a dog walking uh app. And they said,

"Okay, create me an image for it. Create

me a name for it." And then they said,

"Okay, Canva, turn this into a deck. I

want to raise money." At the end of the

day, you know, we're not too many steps

removed from, you know, chat GPT, start

this business for me and start, you

know, wiring the revenues to this

location. Uh, I mean,

I I I think that's the the the multi-t

trillion dollar endgame here where at

some point we see autonomous

corporations.

Mhm.

Yeah. I literally did exactly what you

just said, Peter, yesterday at a red

light

uh in Cambridge as I was sitting there,

created a business plan and tried to

recruit a Princeton team into it via AI

at the red light. Say yes, but

that's like that's like when Elon said

when he was driving from SpaceX back to

his home in Beverly Hills and there was

traffic and he goes, "Damn it, I'm going

to start, you know, an a tunneling

company. I'm going to it's going to be

boring. I'll call it boring ink. I mean,

and then it's there's literally a future

in which we're going from mind to

materialization. It's stating what you

want to do and having the universe

conspire to create it for you.

That's crazy, ID.

Yeah. I think, you know, he has a boring

company, but then he has his even cooler

name of macro hard, his new software

company.

I love that.

Against Microsoft.

Elon is a 13-year-old kid for sure,

which is literally trying to do this.

It's trying to create ideas to full

companies entirely digitally, right?

And I think what you've seen is three

phases. Consumption was expensive. It

became cheap.

Creation was expensive. It's becoming

cheap. And now the valuable thing is

curation and attention. So again, the

battle is who can have that value for

the pixels that you see, for the noises

that you hear. And then a lot of that

creation element is going to be

abstracted away. And I think all the big

players realize this.

And the question is where does it end

up? Where does it go eventually, Dave?

Well, know that quote that you had, I've

heard it a hundred times. You a million

startups just died because of what they

rolled out yesterday. It's absolutely

not true. Show me the names of those

startups that died. And this came up

when we were talking to Amjad Masad a

couple weeks ago on that other podcast.

You know, the founder of Replet, he had

to build his entire foundation model

from scratch to get to market because it

was before, you know, OpenAI had the op

APIs. And you ask him, do you regret

that? You had to throw away all that

code. He's like, "No, I absolutely don't

regret it. You constantly have to

change. You know, AI is going to move at

this ridiculous accelerating pace.

You're not reinventing your business

constantly. You're dead on arrival."

Yeah.

Yes. Exactly. And but your team is

intact. If you have a great team and

you're in AI, you will succeed every

single time. Yeah. Maybe something you

do gets crushed by the next iteration of

Open AI, but you pivot so quickly and

easily, just like we're talking about

right now. So, you show me the names of

those companies, those million companies

that died. They don't exist.

All right, let's jump into the next demo

they had at OpenAI day. It is agent

builder. Creating multi-step workflows

without coding. I'll just show the first

few seconds of this.

And to make this interesting, I'm going

to give myself 8 minutes to build and

ship an agent right here in front of

you. So, I'm starting in the workflow

builder in the open platform. And

instead of starting with code, we can

actually wire nodes up visually. Agent

Builder helps you model really complex

workflows in an easy and visual way

using the common patterns um that we've

learned from building agents our

All right. Uh Immad, you're building

agents left, right, and center right now

for intelligent internet. Uh what do you

think of this?

Yeah, I think you kind of gone from the

creation to the now composition and the

multi-stage process for image generation

and media. We built something called

Comfy UI, which again is this nodebased

process. But where we're going, we don't

need nodes and spaghetti.

Exactly.

You know, the future of these things,

you can look at our common ground

platform for example. It flips between

camban and kind of workflows and gant

charts and things. It will just show you

what you need to show. And the way that

you'll interact with agents is like

interacting with Jarvis in Iron Man.

Like I think in a year or two, that's

what the agent build is going to be.

You'll just have a nice chat and it will

show you all these things and mock them

up instantly. And in fact, Claude had

this with their latest release for the

pro users, this instantly generating app

desktop type thing that literally

programmed things on the fly without

code because code is just a human

translation layer and that can be

removed completely.

For sure, Dave.

Yeah. Yeah. It's funny because the the

people succeeding in AI are

overwhelmingly really young, really,

really smart with very limited business

experience and they keep recreating the

same mistakes from like 20 years ago.

It's okay because you know AI is such a

great tailwind. But this this graphical

programming language, those lines is the

stupidest thing in the world in the age

of AI where you can talk to to the AI.

It's very similar to in the cursor

interface. if you want to upgrade your

account and you're talking to cursor

like hey uh or or to Claud um 4.5 hey

Claude upgrade my account and it says

well go to the menus navigate to the

settings like what are you talking about

I'm talking to you right now you have

MCP like just just do it so that'll all

get fixed very quickly but it's it's

crazy the whole interface to AI is going

to be voice

voice and images

and the idea that you're going to design

programs by drawing boxes and connecting

with with lines

which has been around since like 1980.

No, no, no, no, no. So, it's it's it'll

it'll get cleaned up very very quickly.

It's just kind of funny to see this

transition phase and and all the same

old same old mistakes being made.

Alex, any uh any other points you want

to make on on agent builder?

Yeah, I'm reminded almost by analogy of

the the early days of Hollywood that

were shaped around vaudeville type

design patterns. I think that that's the

stage that we're at. This is the

vaudeville on Hollywood screens stage of

of AI for software development where

it's just sort of um on the one hand

it's great glad that it exists and glad

that it provides probably a comforting

safety net for enterprises that are

migrating to endtoend agentic workflows

on on the other hand very much feels

like a passing phase I I think it's an

interesting modality for specifying for

software development but really why not

take a full leap and instead of

specifying flowcharts for for individual

individual workflows, why not just dump

in an entire org chart of a human

organization and rather than individual

tasks or roles, just port over an entire

company work chart and ask for an entire

enterprise to be replicated.

Vogill analogy is is great. You know, if

you look at an old original black and

white movie and the actors are on an

actual stage with actual stage lights

doing they're doing a play and they're

just recording it on film. Uh very

similar to when the internet took off

and the newspapers just copied the exact

newspaper over to the internet and said,

"Oh, we just read it over here instead."

Same font, same everything.

We humans are so stuck. We're so stuck

in the way we do stuff. We have such a

high cost of switching. All right,

continuing on this theme of voice mode

over everything. Uh here's a little

video of controlling codecs with voice

mode. Take a listen. Let's see if we can

actually control this camera now with

this Xbox controller. There we go. It

works.

That's pretty awesome.

What's funny is like I didn't even

specify to codeex which button should do

what, but it figured that the joystick

was probably a good idea. So, that's

that's actually perfect. But let's uh do

the real test now. Let's enter voice

mode and see uh what happens. So, hello.

Hi there. I can hear you loud and clear.

Let me know what you need. Yeah. What do

you see on the camera?

I see a large audience in front of you

with rows of attendees seated and ready.

The room is well lit and the crowd

stretches far back filling the space.

That's right. Could you uh shine the

lights towards the audience?

There we go.

I've just lit up the audience with a

nice bright water. They should be

perfectly highlighted now.

All right. So, this is a unusual demo

for for Codeex to say the least. just

showing our ability to control physical

items in our environment. But I have to

say I love this for one reason. I've

always said I will invest in the first

company that's able to make AV

foolproof, right? How many of us are uh

in conversations or giving presentations

and we can't get this to connect to

that. I just want to be able to say to

my AI, you know, show that video on that

screen, you know, connect me over Zoom

to that screen. So there's hope still

and that's a that's a business plan that

like that's not hypothetical. That's a

business plan that if someone's

listening right now and they get

together a team and then Peter Seed

invests in it to give it credibility

that will become yet another one of

these massive success stories. It's it's

really that simple.

I'm on stage and I say you know

something fails. Okay, you know AI is

easy, AV is hard. Well hopefully AI can

solve that. Well, but also controlling.

Right now, you kind of wave to people

that are backstage and they push some

buttons or whatever. It's crazy because

the AI can now recognize your hand

gestures and can respond to your voice

and it's much more engaging for the

audience if you're talking to the AV and

it's changing the lighting, changing the

slides, you know, pulling up things from

the internet in real time.

Very doable. You could get that product

out the door in like six months or less

and just crush it. And of course, it

self-demos and then Peter, you know,

Peter will bring it into the podcast and

it's like it's just that simple.

There you go. Let's let's start with

with uh with Alex. Alex, what's your

thinking? I think it's it's sort of

interesting because so many facets of

codeex are open source and and available

for review on GitHub to actually trace

where it

appear. Tell us what tell us what Codex

is in the in the first point.

Codex is uh is a an open AI brand that

seems to cover a number of different

independent software tools. So it covers

their code generation specific AI model

backend. It's also used as a web front

end for software agentic software

development. It's also used in

connection with a command line interface

tool. So, so they they use it as a an

umbrella branch as it were. But in in

this case, at least one of the codecs

associated projects is up on GitHub. You

can review the source history. And so

pulling the thread on the story, it was

it was interesting I I think to to

discover that at least some aspect of

this functionality appears to have

originated as a feature request from a

third party from the Carnegie Melon

affiliated software engineering

institute back in April. That was uh

where where a user was complaining or

really pointing out that human prompt

typing speed is increasingly become the

limiting factor becoming a limiting

factor for software development. So,

by the way, I want to read I want to

read a quick tweet here that came over

from an open AI employee. It says,

"Agent builder we released today was

built end to end in under 6 weeks with

codecs writing 80% of the uh the PRs.

This matches the AI 2027 report uh in

that was forecasted in 2026. Coding

automation goes mainstream. Agents will

uh work like teammates. AI R&D is 50%

faster from algorithms. I mean we are

seeing sort of I want to say science

fiction but science predictions sort of

tying much closer to reality.

We're close to the point of recursive

self-improvement and and it can go in

the other direction as well. We can get

negative speed where the software is

just written preemptively.

Interesting. So, you know, we're not

smart enough to realize we need the

software, but the AI is and it's prepped

for us in advance. Exactly. I love that.

Immad, your thoughts on CEX here.

Yeah, if you get enough tokens. I think

this is the thing like most people are

just using half a million or a million

there and you know like to build

something like that's five bucks with

the new Grock model. It's 50 cents like

you're seeing a crazy thing.

I want to come to that after we we we

close on this which is you know how

would you be disrupting open AI if you

were going to? Um Dave, you want to

comment on on controlling codecs with

voice mode?

Well, something Alex said really sparked

a thought which is you know codeex when

they launched it was a way to run five

or 10 different coding processes in

parallel and have status checks and it

made you much more efficient. But now

you know they use it to to kind of

bundle five or 10 the different things

together.

This is going to be a real problem

because we're used to products having a

very specific name and brand and doing a

very limited number of things. But with

AI, the explosion of capabilities is

exponential and you can't even keep up

with the names. So now it's going to be

much more like these thematic branding.

Like codeex is a grab bag, you know, GPT

is a grab bag, but what else can you do?

There's just so much going on. So just

keeping up with the names of things and

naming things in general is going to be

we had that conversation with with Kevin

Wild Kevin Wheel at OpenAI that is

naming protocols are kind of insane.

Yeah.

Yeah. this if we can add one thing um 6

months ago Dario Amadai from Anthropic

said that 90% of code will be written by

AI I think he meant can be written by AI

and this is a really great example of

that

and so again they decided to embrace it

so you see codeex the CLI the command

line interface tool literally gets two

updates a week which for a multi-billion

dollar half a trillion dollar company is

unheard of

and so again as Alex said I think you're

going to get these self-recursive

improvement cycles first with humans in

the loop, but then the software might

just upgrade itself and respond to what

people might need. Yeah. Continuously.

Yeah. What's interesting is that that

interacts with the interfa like like if

you said my iPhone is going to update

itself twice a week, you'd be confused

as all hell. Like you would never know

where anything is. But now that you have

an AI interface on everything, it's okay

because it's self-explaining. It's it's

just seamless.

I mean, I just want Jarvis. I just want

an AI I talk to and it does everything I

need to get done. I'm just going to

assume that anything is doable and my AI

is going to enable it or find the

capability and I don't need to know all

the hard work it's doing on the back

end. I don't need to know what's calling

up getting access to. It's just making

it happen.

I'm telling you, Peter, within the

virtual world, not within the physical

world, but within the virtual world,

that's today. You know, no one's

productized it yet, but all the

technology and capability exists right

now. The robotic version of it where it

makes your Iron Man suit might be a year

or two or three out virtual world, you

know, build me a video game, build me

whatever. That's right now.

Yeah.

Someone needs to go and get Paul Best

voice rights, you know.

Let's let's take a look at one more

video from OpenAI day, which was the

Sora 2 uh API and a segment I call

sketch to video. And again, this is

going from mind to materialization. If I

can imagine something, can I make it

real? Uh, take a listen. Today, we're

releasing a preview of Sora 2 in the

API.

[Applause]

Mattel has been a great partner working

with us to test Sora 2 in the API and

seeing what they can do to bring product

ideas to life more quickly.

So, one of their designers can now start

with a sketch and then turn these early

concepts into something that you can see

and share and react to. So let's take a

look at how this works.

So if you're listening to this podcast,

what we're seeing here uh is basically a

hand sketch then being developed into a

photorealistic video of a Mattel Hot

Wheels toy or Matchbox toy. Uh super

compelling. uh being able to go from

from that and I've talked about in the

future I'm going to be able to describe

verbally what I want. I want a device

that can hold a hot liquid. I want to

have a handle on it. I want to have it

this color. And then as I'm describing

it, it's visually materializing on my,

you know, AR glasses in front of me. And

I say, "No, can you make it a little bit

larger? Can you stretch the dimension?"

Just in in plain English. And then how

much would it cost to make? It gives me

a price and can you give me an

alternative that's cheaper or that has

better thermal insulation and they go

yeah that's it please print it for me

manufacture it for me and put it up on

the web so anyone can grab it. I mean

this going from again I call it mind to

materialization super powerful uh you

want to open up on your thoughts on

this? I mean the holiday deck is getting

closer, right? Not with hard lights, but

as you said, that aspect is there. These

models learn physics, they learn

material. So in the video that just

shown, the car goes down these ramps and

it's transformed it into 3D. You can

have 3D extensions from it.

One of the things you can do with these

models is like you can actually do a

sketchboard where you show scene by

scene

how every single thing changes and you

have that as the input and it'll

generate that clip.

And it doesn't do that by thinking or

breaking it apart. It literally

interpolates the concept to the video.

And so we're actually only scratching

the surface of how powerful these models

are at the moment. And then I think as

they get more and more used, you'll see

that they are genuinely world models

that can create anything you can imagine

and then adapt on the fly as well

with audio to match with perfect audio

to match.

Yeah.

Yeah.

I think everybody everybody has access

to this, right? They just launched the

API version of it yesterday for large

scale use, but anyone can do this. And

if you haven't done it, you're crazy. Do

it. It's so mindopening and compelling.

Do exactly what Amad said. Do it as a

series of scenes. And then right right

now, you got to wait about five or six

minutes to get your video back, which is

really annoying. Uh, and it shows you

the comput

how quickly we are spoiled by

Well, it shows you the compute

bottleneck though. I'm sure when they do

it internally, it comes back in a

millisecond. You know, it is physically

possible to do it very very quickly. Uh,

but again, way too many users for the

capability, but you got to try it

because again, it's mind opening. When I

first saw this video, I I didn't get it

because I couldn't tell. The video is

actually synthetic. I thought I was

like, "This guy's sketching a toy, a

Mattel toy, and here's the toy." Like,

so what? Like, oh, wait, that's not a

that toy doesn't even exist. That's

that's actually been synthetically

created. That it's just so good. The

video has perfect physics. You know, you

just would never know that it's

synthetic. Uh, Alex, what does this mean

in the final result? Where are we going

here?

This is mechanical design getting

solved. MIT, the mechanical engineering

department, has an entire set of courses

just devoted to training the next

generation of mechanical engineers how

to do product design like this. We're

seeing right before our eyes an entire

discipline or subd discipline get solved

in bulk by generative AI. And I think

maybe even more interesting than this

particular instance is the API pricing.

So if if you go to the the API p pricing

page now for for Sora 2, it it's 10

cents per second for the base model. You

do the arithmetic that's $360 per hour.

Assume 10x year-over-year hyperdelation

model costs within the next year.

Suddenly, it's far cheaper to outsource

mechanical product design to an API call

to Sora 2 or whatever it evolves into

than a human. That's an entire

hyperdelationary field getting solved

overnight.

Okay, keep those numbers top of mind

because when we start talking about

compute in a minute and the cost of

compute, you'll immediately recognize

what what Alex just said. you know, that

10x deflation in price. We need that

desperately because the demand for what

we're seeing here is going to be orders

of magnitude bigger than the amount of

compute currently available.

What an amazing time to be a kid, right?

Imagine you're sitting down with your

mom and your dad and you're just

describing what you want as a toy or

what you'd like your toy to do and all

of a sudden it's materialized into a

video for you and then some other

enterprising company in the 3D printing

world says, "I can just manufacture that

for you as an end of one." I mean, just

amazing.

Star Trek replicators aren't 24th

century. They're they're now just 2025.

We are really bringing Star Trek to

today. That makes me so happy. I'm so

happy about that.

Why wait a few centuries?

Yeah, for sure. All right, so uh we're

going to wrap on the Open AI day there,

but I'd like you to jump in here a

second. Um you know, we're seeing a half

a trillion dollar valuation for Open AI.

We're seeing open AI really working hard

to create multiple revenue flows from

advertising from selling products in a

multitude of other areas. What are your

what are your thoughts on open AI?

So I think that the core business of

open AI in terms of the monthly chatt

subscription is going to come under

challenge because we've seen this

breakthrough with deepseat gro 4 and

others where the cost per million tokens

is literally dropped 20 30 times and so

the basic chat experience is not good

enough anymore. So almost like you see

these levels of AI that will fill. So

the chat experience is basically a

couple of bucks a year when you

calculate now in terms of the cost down

from 200 bucks just over a year ago. So

now they have to think about agentic

workflows. They have to think about

economically valuable workflows and then

even beyond because the number of tokens

goes from 2,000 to 20,000 to 200,000 to

2 million. And so this is why when we

see Sora, they're doing likenesses and

they'll be doing advertising and more

because how do you have the cash flows

to justify that? Google and Meta both

have the advertising cash flows.

Mhm.

How do you monetize those 800 million

users? Either by delivering excess value

through your $20 a month subscriptions

or by having these new verticals because

your competitors are going to release

what was your key product at the start

of this year, Chat GPT, for $20 a month

for free because that's how far and how

quick token prices have dropped.

Yeah. I mean we've talked about the

notion that open eye is really trying to

do a global land grab right going into

India going into the where you are Immad

in the UK going into Greece going other

locations I mean and it's interesting

battle between its land grab and then

you've also got all of the open- source

models coming out of China uh which are

which are going after a a land grab as

well. Um,

well, you know, Paul Graham said Sam

Alman if you dropped him on an island

full of cannibals and came back a year

later, he would be running the island.

Uh, so I mean, he's got to be the b one

of the greatest business strategists of

all time. And so he's going after India.

He's going after a massive installed

base. He's got an 800 million user

installed base. He's going after the

rest of the world. And he's also going

after the data centers. And we'll see

that later in this podcast. So I think

he's narrowed in on the the two

foundational points of control in this

great battle are installed base of users

and massive amounts of compute. If you

control the end points, everything in

the middle will fill in. That's the way

the way I think he sees it.

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All right. Uh I call this section

meanwhile in the continuing AI wars. Uh

let's hit on a few others. Anthropic

nears superhuman computer use. And here

we're seeing a graphic of uh of

performance as a percentage uh hitting

human performance very close to it. and

we're seeing uh basically over the last

year. Alex, do you want to kick us off

on this one?

Yeah. So maybe a comment first on what

the benchmark is. In the past on on this

podcast, I've beaten the drum for the

importance of benchmarks more broadly

for not just measuring progress, but

also accelerating progress. In this

case, the benchmark OS world for

operating system world is really lovely

benchmark that was initially developed

by Salesforce and colleagues. And it's a

benchmark that measures the ability of a

computer use agent and an an AI that has

access to a keyboard and mouse and

screenshots to be able to conduct

regular everyday economically important

tasks on Ubuntu, Linux, Windows, and Mac

OS. Hundreds of different types of

tasks. And and so what Anthropic is

demonstrating with this chart is

probably again by the law of straight

lines perhaps by the end of this year in

the next few months we're going to see

at least from Anthropic putting aside

other other frontier labs superhuman

performance at the ability to control

computers for normal everyday tasks.

So Alex and Ahmad I I asked uh

Perplexity Comet what does this

benchmark even mean? It's really vague

and it came back with some complete

garbage answer. So hopefully you can you

can fill me in like what are we

measuring here? We're we're measuring

the ability for an AI to literally

control uh Windows type interface with

mouse control and keyboard control and

perform a variety of tasks. Web browser

navigation that would require

it's ultimate ver it's the the ultimate

you know uh verbal interface,

you know, do this for me

without the verb.

I don't need to know. I mean, I just set

up a new MacBook Pro and getting all of

the settings back to where I wanted it,

it just ate up a half a day of wasted

time.

Yeah. Yeah.

Yeah.

Peter, you want Jarvis, this is Jarvis,

albeit not in the physical world for

Jarvis for controlling your computer

across applications, but this is a

pretty good benchmark for Jarvis for

computer use. There are companies that

are also setting up giant science

factories controlling, you know,

hundreds or thousands of experimental

devices, right? Where it's uh just

basically putting an AI layer on top of

all of them and running 24/7 dark

experiments to ferret it out the

breakthroughs of science. Um anyway, uh

Immod you want to add to this? you know,

it's 360 odd tasks that take over your

computer. Out of the labs and things,

it's a different kind of reinforcement

learning environment. I think what this

is showing is that these generalist

models are getting good enough to do

most human standard tasks. And again,

these models have economies of scope. So

now we're seeing thinking machines and

others building RL environments so they

can plug into the real world even more

seamlessly. And I don't think anyone

believes that that line isn't going to

break through the human level. Again,

this is the takeoff point. And so when

they can control anything we can control

digitally and then physically,

then it's only a question of the number

and quality of tokens behind that. And

so again, this is the takeoff point.

This is why we're about to see

and what could possibly go wrong.

I would say what could possibly go right

and quite a bit can go right.

Yeah. Okay. Thank you for bringing me

back to the world of abundance, Alex. I

appreciate you.

Anytime.

All right. And our our next uh our next

news item here is a major update to Gro

imagine uh going from V 0.1 to V 0.9. I

love the the numbering protocols

everybody. And also uh Elon entering the

gaming world or at least announcing you

know Elon if anything else is a gamer

and the video gaming industry is massive

you know uh you know outweighing

uh entertainment by you know Hollywood

by a long shot. Let's take a quick look

at a video clip. Uh and the thing that's

important is Grock imagine can generate

15-second clips. Uh, and their comment

is, "We're focusing on speed and fun."

All right. Well, let's take a look at

some speed and fun. Grock launched as a

truth seeking AI.

And I love

love that it says Grock launched as a

truth seeeking AI. And there you see

Elon as this, you know, medieval

emperor, you know, in battles. It's

like, okay, this is the truth. We're see

we're seeing this. But I I think even

just t taking that line, truth seeeking

and combining it with these models. I I

completely buy the the notion that video

as a first class modality when

incorporated into chains of thought is

going to help us to discover the truth.

I I think it it's one of the the key

modalities for understanding our

universe. Okay. What what does that

mean, Alex? Dive in a little bit deeper,

please.

So, when you ask a question of chat GPT

or some other frontier model, now post

chat GPT5, there's thinking that goes on

usually under the hood. It it thinks

internally sequence of tokens before it

produces a final answer. Right now,

almost all of that thought takes the

form of text tokens. But imagine a near

future where the the agent, as it were,

is able to think not just in terms of

text, but in terms of video. It's able

to hallucinate a short video clip

imagine, you know, basically visual

imagination imagining things that you

can introspect as well. You can pop open

little drop down and see the little

videos that it's it's generating as part

of its chain of thought before it

answers your question. Video reasoning,

I think, is going to end up being a

killer app for how these video models

that right now are obviously largely

aimed towards entertainment end up

delivering transformative economic

value.

Amazing. in our you know our occipital

cortex our our neoortex for visual image

understanding processes much more data

than our ability to to bring it in

language

yeah so open AI did $4.3 billion in

revenue in the first half of the year

the video game market did 200 billion in

revenue last year so you can see when we

think about gaming when we think about

media this is a massive market to go

after and you know ex Elon are going to

go after it from a first principles

basis whether or not the games will be

any good that's a question you know I

think they'll probably be quite

addictive

um and again the scarce things in the

world there's Bitcoin there's my

financial coin there's human attention

the battle for human attention is the

next battle for revenue

and everyone is basically drawing their

lines getting their GPUs ready for it

so I think we'll see this type of thing

from everyone and it's good for

consumers in many ways because the

quality bar will lift and the access

will expand.

All right, I we can go so deep into that

entire conversation, but before we exit,

uh meanwhile in other AI wars, I wanted

to play a quick clip and say a thank you

to one of our subscribers, CJ Truheart,

who heard our call for a Moonshot theme

song and proposed one. Not saying this

is it, but I was super impressed. Okay,

let's hear what he has to say or sing or

produce.

So, I recently heard you guys mention on

the last podcast that you were going to

create a Moonshot theme song. And for

someone who's who's been using Sunno for

two years and and uh especially since uh

Moonshot's podcast is is my favorite as

far as AI and technology goes. Um I

really appreciate you helping me be able

to understand what's happening and give

me a perspective for my entrepreneurial

creative mind to best position myself.

Made you a customized um theme song for

the moonshots.

[Music]

Where the moon shot me breaking through

the noise

just with a clarifying voice in a races

disruptions never clean. We'll show you

what it means. The story between

[Music]

tomorrow.

[Music]

Love that.

Thank you, CJ. I love it. I love the

fact that you pulled over to shoot the

shoot the video, too. That's just

awesome. Much appreciated.

Yeah. Just I appreciate I love our

subscribers. They're just uh they're

generous. They're intelligent. They're

creative. And just a shout out to all of

you guys. Thank you. We love your

feedback, your input. We read it. We

consume it. All right. Uh let's jump

into our next segment. Chips and data

centers. A lot going on there, but

probably the single most important news.

AMD and OpenAI announced strategic

partnership to deploy 6 gigawatts of AMD

GPUs. Uh Dave, let me go to you, buddy.

Yeah, I stock moved what 30% on the

news, which shows you Sam's ability to

morph the world or warp the world to his

uh perspective or whatever whatever he

says. Massive massive impact on a huge

public company. Uh and uh you know, it's

it's interesting. He's going to get 10%

ownership or OpenAI will get 10%

ownership if they hit milestones for

basically no price. Uh and how often do

you get to negotiate a deal like that?

Unless you're the president of the

United States, in which case you can

negotiate all the time.

Yeah, I guess that's true. The reason

this is a serious win-win, though, is um

you know AMD is they have capacity to

manufacture with TSMC

and anyone can design inference time

chips uh and and sell them out, but you

have to have the manufacturing capacity.

So Sam's going to grab that capacity via

AMD. Uh, I'm really curious on November

14th to look at Leopold's 13F filing,

you know, from the situational awareness

hedge fund and see if he also bought AMD

and got that 30 or 40%.

He probably did.

Probably did. Yeah.

I mean, Dave, isn't this I mean, we

could have predicted this as well. At

the end of the day, we, you know,

talking about Intel uh and the

criticality that capability, you could

have said the exact same thing about

AMD. Who else? I mean, there's Broadcom,

uh, there's uh, Micron. which of these

other chip manufacturers are going to be

pulled into sort of this US- ccentric uh

chips first strategy? Well, I'll tell

you what else. If you drill a layer

deeper underneath the chips, there's a

whole bunch of other material that will

get dragged into the vortex that no

one's quite realized yet. So if you

really want to see these 30 40 50% pops,

you look a layer deeper than just the

chip companies into the underlying, you

know, you've got, you know, silicon

bools, you've got glass, you've got, you

know, all this underlying manufacturing

infrastructure that's all just going to

get sucked into this same exact vortex.

And you know, a lot of those are public

companies and some of them are smaller,

too. So the the movement is much bigger.

Yeah. Emmod, thoughts on this one?

I mean, he'd probably just be calling

everyone now and saying, "Hey, you want

to give me warrants? Your stock price

will go up, right? To all the

companies."

Can you imagine that if he if he

ironically did this exact deal 50 times

back to back? The amount of value that

would create. Oh my god.

Just all the SAS companies. Come on,

partner up with me. Right. Here's the

Hey, if you want to do a deal with

EverQuote, I'm the chairman of that one.

Just give me a call. We'll do we'll do

this deal tomorrow. You're right. I do I

do wonder if he's using GPT6 Pro to kind

of come up with these deals, but I mean

this it's massive.

If you look at the 10 GW that they're

doing with Nvidia and the 6 GW here,

it's about $50 billion of buildout per

gawatt.

So it's about $800 billion of buildout,

like a trillion that they've already

got, I think. Probably more.

Amazing. And completely sold out. Sold

out years in advance.

Sold out years in advance. And you know

again the only market that can sustain

this and incry the revenue that is if

they're going after

the entire like all software jobs

effectively. So I think in the next few

years you're going to see basically

OpenAI and others replicate the whole

macro hard strategy of fully autonomous

workers. that is the product that they

will bring to the market and they will

cost like 10 20,000 30,000 $100,000

and that's the only thing I can see that

will fill this particular massive amount

of

Alex are you going to stick with your

efficient market hypothesis from uh two

podcasts ago or are you going to just

start tracking the tail number of Sam's

jet and seeing who he's meeting with

next? Well, I I one might imagine losing

sleep as a public market investor that

maybe the singularity as it were happens

in some private company where there's

indirect at best exposure via public

markets. Like what happens if Open AI

and call it the the 10 other largest

privately traded companies suddenly have

an intelligence explosion and are worth

tens of trillions of dollars overnight

as a as a public retail investor. That's

perhaps a suboptimal outcome. So, so I

would actually view this as through a

very positive lens that through

indexing, through exposure to AMD,

Intel, etc., this is now an enormous

jump in exposure to open AI to the

extent that an intelligence explosion

happens there. Let me uh hit on a couple

of of these uh related stories. So,

BlackRock is buying up to 78 data

centers totaling 5 gawatt in a $40

billion deal. Um and then we're also

seeing here Corning uh is posed to

dominate AI data centers with optics

obviously for for fiber optics for

connecting everything uh on these two

topics of of Corning and Black Rockck.

Uh let's get some commentary there.

Yeah, I mean that's the war for the

downstream kind of elements here, right?

like Black Rockck coming in with that 40

billion. They're coming about three

times what the normal multiples are like

you need to deploy capital and this

feels like currently the best capital to

deploy. Downstream Corning is kind of

optimal here but half I think something

like half of all GDP growth in the US

this year is AI

which is insane.

I mean, comparing to where we were even

just a year ago or two years ago,

um, it's

it's an economic transformation story

for the US at at a minimum. The the

company that Black Rockck is purportedly

considering buying many of the the

campuses that they're converting to data

centers or are brownfields, including

according to public reporting, uh,

former coal plant in Ohio. This is what

economic transformation, industrial

economic transformation at scale looks

like. and then it is the it's the world

it's again we're on a war footing we

have to realize that we're in just

preWorld War II we're converting

automotive plants into aircraft plants

we're tiling uh I mean you know Santa

Monica airport where I fly out of was

basically build out as a secret

manufacturing and uh airport hub uh it's

it's happening and it's

this is programming of the entire

industrial base Yeah.

Yeah.

Yeah. And also uh it's another

investment theme just for our

investmentoriented listeners. Uh one of

our best and most prolific partners Kush

Bavaria is starting a new company with

Alex's help. Uh that funnels money into

data centers. But it's part of a broader

theme of if you know this is half the

GDP growth of the c country and

accelerating there's all this pentup

capital all over the world that's not

investing in things like corning. So if

you can create new conduits of the money

into all the implications you know so

Alex has been talking about photonix for

months now and the leap from there to

saying oh Corning is going to benefit is

not a huge leap. So then you know the

capital just needs to get into these

avenues to keep this engine humming and

so uh you know new entities new funds

you know black rockck is obviously very

very smart money pouring into this area

but then all the other implications you

know you know data centers and new

geographies and pumped hydro and what

about the equipment for pumped hydro and

solar installation costs all those

things all are investment opportunities

I

I mean is there I mean is this an

infinite sync in other words it's going

to attract as much money and

capabilities and resources. Uh, you

know,

is there is there any moment where the

music stops and uh there's not enough

chairs for everybody who's invested?

It's easy. It's super super easy to

calculate. Now, it's an infinite demand,

no doubt, but it's limited by chip fabs.

So, if it gets overbuilt or

overinvested, it's just purely because,

you know, too much of X for the number

of chips. But, you know, the upper bound

is based on the chip fabs. And you can

see those coming four years in advance.

Mhm.

And so, you know, it's all bottlenecked

at at Intel, TSMC, and Samsung. So, from

there, you can do all the math in both

directions in terms of data centers and

users and everything.

Well, we my mental model

Go ahead. Go ahead, Alex. My my mental

model continues to be that the music can

continue as long as the transformative

applications continue. As long as we're

driving the cost of the service economy

to zero, as long as transformative

discoveries and scientific inventions

pour out of these super intelligent

boxes, then the the music can't

continue. The the data center buildout

can continue to the point of trillions

of dollars of capex. We just need the

transformation to continue and the

revenue generation that results from

that. And the transformations, you know,

optical like, okay, nothing was optical,

now it's all going to be optical.

Corning, huge beneficiary. Nothing was

liquid cooled. Now it's all going to be

liquid cooled. The Jeff Markley told me

he bought a million valves. Why'd you

buy a million valves? It's like, well,

because if water starts leaking out of a

pipe, you need to isolate it quickly.

These are like, you know, $60,000 in a

single one U. You can't have water

dripping on them. So, I need to But

there aren't enough valves in the world.

So, I bought them all.

And then there's the under there's the

underlying problem here of energy

production, right? We're about to see

energy begin to spike. We're seeing

certain communities that are voting

against opening up data centers because

they don't want to have it soak up all

the energy. And so are we going to get

differential pricing where data centers

are paying this much per kilowatt hour

versus homeowners playing paying a

different otherwise we're going to have

you know communities basically blaming

uh you know the AI tech bros for taking

their jobs and hiking up the cost of

electricity and that does not bode well.

I I think that the scenario where uh new

data center deployments continue to be

connected to to utility scale grid is

probably implausible at this point.

There's there's simply too much demand

for colloccated new energy output that

is completely off-rid. As long as the

regulatory environment continues to be

favorable, and it it does continue to

be, I I think we end up it's more likely

we end up in a future that looks like

Colossus where there are coll-located

NAT gas and soon SMRs and fusion plants

in a few years and all of that is by

default disconnected from the broader

utility scale grid.

Yeah, I think that you you had Jeff

Bezos who is a pretty smart guy saying

we will have gigawatt data centers in

space and when you actually do the math

it actually makes sense in a few years

when you look at payload costs you look