How to Win Deals & Grow a $250B Business | Nikesh Arora, Palo Alto Networks

So the guy who spoke at dinner, I said, yes, it goes, Oculus. Palmer Luckey. Yes. Well, Brendan, to be fair. Okay. Brendan Rebe and Palmer Luckey, of course. I said, great. So I said, give me a number. So I texted Brendan and said, hey, we met at the dinner. I'd love to make an investment. He's like, great, but you have to come see this stuff. This stuff's real cool. I said, okay. so I'm in LA and I said Brendan I'm coming to LA can we take a look at the technology it's me and my wife we go there she says yeah but you have to drive on a highway outside of LA because we have this industrial park we're going to go there's a fire so I take a car I go to the industrial park The lights are out, so nothing's gonna work.

So we're kind of hanging out, waiting for the lights to come back on. We go in, he puts this contraption on her face, and it's got this little virtual reality type situation going on. I says, really cool, this is very cool. What's gonna happen? Well, it's gonna be cool because, you know, all the promise of visualization, all the promise of gaming, et cetera, et cetera. I said, great, can I write a check? She's like, sure. He's like, it's you and Blake Krikorian and Vivi Nevo and I have room for one more. So Egon and I do this together and Mark was already in the company. So I said, okay, so me and Egon.

So we agreed to do the deal. He sends me some docs. Oh, he sends me an email. He says, I'm working on the docs. Doesn't respond. Egon says, what's going on? Why haven't we heard from him? So I sent him an email. He says, yes, the docs are just coming. They're going to be here with you anytime soon. No docs. and boom, you wake up one morning and he's just been sold to Facebook. Before you're able to invest. So this group that Ari writes about. We ended up being the technology advisory board to William Morris when it was acquired by Silver Lake. Okay. Mark and I. Okay, well, I don't even know about this.

So what were you guys advising him on? Whenever he had a question on technology, the advisories around Egon and Ari are very straightforward. Ari does the 15-minute phone call. 15, it's like now I did the episode with him. Now his book is called Rolling the Calls. Now he does it to me. So I get a call and it's like, hold for Ari Emanuel. I'm like, you're calling me. And then sometimes they're like 25 seconds and there's no goodbye. Yeah, but you know what? I'll tell you, it was fascinating. So we would do that when we had something to talk about. And I understand his shorthand. He's trying to get something done.

He's a man on a mission. But there was a time when I had left SoftBank and he reached out and said, what are you doing now? I said, nothing. I'm just trying to figure out what I'm going to do. He said, why don't you come by and come see me, and then we can talk about it. I said, okay, I happen to be in L.A., I'll come see you. And my assistant's like, Ari's office says you're having lunch. What time should I schedule to depart? I'm like, listen, it's probably going to be 15 minutes. Why don't you schedule half an hour, and then we'll get me to the airport and get me on a flight back. And that was the only time I spent an hour and a half with Ari.

So you can tell, he actually wanted to get into what I was going to go do next, and he actually spent time and invested time in that conversation. So he does have a soul. When it's really important to you, he's going to spend a lot of time. But most times, he's actually transactional when he wants to get something done. One of the things I love about Ramp is their... mission is easy to understand they want to help your business save time and money and that is why they have built router do me a favor while you're listening to this go to router.com router was built to reduce your company's inference costs by matching every request to the most efficient ai model router automatically balances cost speed and quality of output router is built for ctos and loved by cfos your engineering team gets the best model for every workload and your finance team gets lower inference spend. One customer of Router has the perfect description of why your company should be using Router. Choosing the right model makes a meaningful difference to our AI spend. We run billions of tokens through Router and have reduced our model costs by 92%. Tokens are money. Save both. And you can do that by going to router.com.

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Eight. Eight. Like, I like to focus on one thing for a long period of time. Like, how do you? Do you work? Well, the good news is, like, even at Power of the Networks or when I was at SoftBank or when I was at Google, you know, Google went from 2,000 employees to 60,000 employees when I was there. It went from $2 billion in revenue to $62 billion in revenue. So you realize even though you're in one place, you're actually doing so many different things. At that point in time, we went from search and YouTube and double-click and, like, you know, buying tons of businesses, thinking of all kinds of stuff.

So I think it's not what you do at one point in time. It's how much your brain can get challenged, how many different problems can you get involved in. So you can swap from problem to problem, solve many things in the same space, and as long as you get the right environmental structure right. If the opportunity is big enough, when I joined, that was eight years ago, we're a firewall company today, and now we do 70-plus products. We're in every aspect of cybersecurity. We're all over AI, trying to make sure we pivot hard on the AI stuff. So you can always keep yourself challenged as long as you get the right platform in front of you.

I just talked to Nick from Revolut, and that was his thing. He's like, there's no way I was going to run a company with one product. He's like, that would be boring. He's running like 20 different experiments at all given times. I think he's in like 30 or 40 countries. He wants to get to 100 different countries. When you got recruited to become the CEO of Palo Alto Networks, they had essentially one product, right? Yes, for the most part, yeah. Okay, was your, this expansion that has since occurred in the last eight years, is that, did you come in with that plan or you're just like, what was the conversation?

I didn't have a plan when I came in.

Why do you think so many other CEOs make the mistake? Is it like an ego thing, where it's like, no, I can build this? I don't think so. What is it? I don't think it's an ego thing. I don't think CEOs set out to make mistakes. No CEO stands up saying, let me try and make a mistake this morning. They believe whatever they're doing is right, and they most likely identify the right company. I think often M&A fails because of bad execution. Your tendency is, you're too busy, you're doing a lot of stuff.

You buy the company and say, great, I have a guy. or a gal who manages this topic. Okay, this person does video streaming. He or she's been trying to do video streaming for the last five years. I'm going to buy a video streaming company and give it to him or her. And you instead put the founder of the company. Yeah, I'm like, whoa, wait a minute. This person just got their ass kicked with all the resources and all the money we had to that guy who got funded by venture capitalists and who went out and lived in a crummy warehouse, hired people, blood, sweat, and tears, built something that has product market fit.

And he or she should work for the empire? That's not going to work. He should be part of the empire. So I switch it. I say, okay, this person did really well. This person is now going to be the head of video streaming. Everybody can learn from him. He can work for him. That sometimes doesn't go down well with some of the people who have to end up working with him. Any existing organization. Of course. They wind up leaving or whatever. It doesn't matter, right? They were the ones who were chartered with winning. They had access to resources. And they didn't. And they didn't. You can't reward that behavior by giving them a prized asset or on the risk that they destroyed the prized asset.

So that's kind of one failure mode. The other failure mode, people say, you know, I always say this, like, you know, my innovation is my genius. There's this pure dumb luck, right? Which means I'm a founder. I created something cool. These guys are not smart. I'm just going to buy number two or number three. I'm going to spit and shine it, make it look like new, and I'm going to kick their ass. That never works. I want to buy number one. Well, you talk about this a lot.

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But remember, one and two is also a judgment call. It could be one and two. You could have one. You could have this one, A called one, and B called two, and I could have B called one and A called two because I'm looking at the difference of the criteria to measure it. There's no obvious criteria. who's one and two they would have 30 customers they would have same amount of ARR which one is one and two are you a tennis fan yeah I'm not really but sure why don't you use a tennis analogy but I'm gonna tell you because I had dinner it was really interesting I had dinner I had dinner one time with uh he's a mental coach to some of the top tennis players and when he says mental coach he's like literally like they got other people to help him with their swing yes my conversations are all about what's going on in their mind and he said something that's very fascinating he's like you know take the top 200 tennis players he's like the difference between one and three is negligible. He goes, the difference between four and 200 is smaller

than the difference between four and three. And he was explaining like, like what appears from the outside, like, oh, that person's number four, that person's number three or two. It's like, that seems the gap is like really small. It's like, it's actually a lot bigger when you get deeper and you actually understand what is going on in their, like, in his case, he's like, what's going on in their mind is actually counting. It's not like a physical, it's not like number three and number four are that different physically. This is like a lot in their mind. So I like this personal fascination whether it's sports business or otherwise of like, oh, kind of from the outside, it's kind of looks similar.

And I've run across a ton of founders. And you spend time with them like, oh, this is why this person, the gap between them and their next competitor is so large. As you said, the criteria depends, right? Some could have clear company attributes which make them one or two. Somebody's got twice the error than the other one. Yeah, we get it. They could be deemed as one much easier. Sometimes they have similar starting grounds. They start in the same place. One came at it from a different angle. Then it becomes, which founder is going to lead this to success or the other? And that's where you're getting into the mindset of the founder and the leadership team.

And that's what we say differently. I say, my job is to fund, once we identify one and two, remember, they also have to be willing to sell. Which the people we were talking about before we started recording are not selling for any price. That's right. Yes. So there's also that. You know, you've got to reanalyze that from that vantage point saying, well, these could be alpha founders. They could be winners. But, dude, they're also sending you a signal by saying, I'm willing to sell. Have you talked to Hawk Tan about this? Have I talked to Hawk Tan about selling? He does a lot of acquisitions. He does it very differently.

I know. But have you talked to him about this? His mindset's a little extreme. So, me and you were together. Educate me, yes. Okay. Well, me and you were together at Dale's house. and this is where I heard this story where he was advising a younger founder that was also there and he was just like just make sure that on day one of your acquisition that the acquired company that you are the conqueror and they are the conqueror. That's a slightly different philosophy. I know you do. Then I asked him, I was like, Hock, why don't you do any podcasts? Do you want to do my podcast? He's like, oh no. He goes, my wife forbids me to do podcasts.

I go, why? He goes, she said I would get canceled. See, I say the opposite. I tell my team, when you're starting a negotiation with a company, remember, they're going to be a colleague. Don't treat them with disrespect. He's obviously an extreme character. I wasn't taking it to disrespect, but like. So which one's right? Which one's one and two in your mind? I obviously know that. Think about it. There's no way you could think of it like he does because you just said, no, this guy's coming in and now he's your boss. Look, my point is that I see differently. I cannot win if 20 people around me don't feel they're winning.

And for them to believe that they're winning, they have to believe they're a first class citizen. They have to believe that they're part of the team and their winning matters. And their winning is as much for themselves as it is for me. Has there been any acquisitions you did too early?

that was kind of fucking up the deal. And Egon comes in, who has way more experience to this, he goes, you're never going to remember the $400 million. And he's like, is this an asset we want or not? Like, you're going to remember fucking up the deal, but you're not going to remember the $400 million.

And, you know, they obviously closed the deal, and it's been way more valuable to that. Well, Egon and I bought a cricket team together in London. I thought you did that with Devesh. No, no, Egon and I are the equal owners. He and I came up with this together, and he called me. I was about to go play golf at the AT&T, and he called me. He says, how's the auction going? It's like 6 o'clock in the morning because it's in London. I said, the last auction went for two rounds. We were at round number 24. He's like, I know. You're going to want it cheap because you like value. This is your upbringing.

This is sport. Welcome to sport. Don't stop bidding. I was still on the phone with you to give you moral courage. Wait, how many more rounds? You were at 24. How many did you have to go? We ended up at 29 rounds. But once he said that, you're like, fuck it, we're getting this? He was like, yeah, what's the worst? We're bringing like half of it. It doesn't matter. Because this thing is going to be a huge success or it's going to be a failure. So he did it to you too. I did the same thing, but I was trying to be cute on the other one. And he just reminded me that, you know, you say that in your professional life, think about it in your personal life too.

So that's what we did. You know, I saw him at the range at seven o'clock and he said, do we own the team? Like, yeah, we own the team now. It happened. So yeah, he's consistent in his point of view. I've heard this phrase differently before. I'm curious if you agree with this characterization. You're not buying companies, you're buying founders. You're buying teams. You're buying teams. you're buying their point of view, you're buying their strategy, you're buying their execution. A company is just a construct that is around the team. That allows us to be held in some legal entity, protect IP, and eventually turn that into sort of a go-to-market capability.

But effectively, what is a company? When you come up with an idea, your first instinct is not that I'm going to start a company. Your first instinct is I'm going to go build something amazing. When you go build, you call yourself a builder, you go find like-minded people who have shared the vision, and then you're the most charismatic person in the room because you're trying to convince people to get on the bandwagon for your story because you had the idea, and it's typically one or two or three people. So you're doing everything. You're a builder. You're building. You're validating your strategy every time you hire the next person.

You're looking in their eye and telling them, this is what we're going to build. The person gets excited. And if you're hiring smart people, they also have to buy into it. So you're basically building a team. You're building a team of like-minded people. You're bashing out the edges. You're aligning the strategy and getting to a point and saying, OK, now we all agree we're going to build this. Now let's go to warp speed and build this shit because you're going to beat everybody else to the punch. That's what you're doing. That the company is just not a legal entity. Think about most of these guys.

They probably have one administrative person who does HR, finance, facilities, and brings coffee. So it's sad. I mean, the company is a construct in which you organize, but you're actually buying a well-functioning, cohesive team. That's what you test for. Can this team execute better than other teams out there? And when you think about it like that and say, I'm going to compete with that team that spent an year and a half getting together and training together, and they're on the field every day. They live in the same house. They work 80 hours a week. and say, I'm going to beat them by hiring a bunch of corporate people, by going through my HR team, going through four interviews, and going through internal process.

I was like, holy shit, you're never going to beat them. They're far ahead. There's a couple things that are popping in my mind while I'm listening to you. Have you ever heard this guy named Henry Singleton? No. Okay, Henry Singleton, essentially like the proto-Buffet. He ran this very successful conglomerate called Teledyne in the 1960s. I found him because I read, when I'm interested in somebody, I read every single thing they've ever, like, written about them or written by them. And they will all tell you the people they studied. And so Buffett and Munger kept talking about this guy named Henry Singleton.

Munger said that Henry Singleton was the single smartest person I ever met. Buffett said it was a crime that American business school students didn't study him. His returns were utterly ridiculous. And a lot of the ideas that I thought that Buffett used for Berkshire were actually he learned from Singleton for Teledyne. But he grew by acquisition just like you did. And at one point, he, I think he does like, I should know this, I just did another episode on him. Let's say 135 acquisitions. I think at one point he owned 135. 30 companies, 129 of them were profitable, so he bought really well. But then he changed his strategy and he stopped acquiring.

And then from there, he never acquired another company for another 15 years. I'm thinking about him while you're talking. Is there a chance where Palo Alto Networks stops acquiring? Possible. As I said, it's not an existential strategy for us. It's a way we can maximize the value for the business. It's a way we can maximize the outcome for our customers. At some point in time, we believe we've reached a point where the marginal value to accrete to the customer is through us making sure all of our stuff works at a customer. Maybe we focus on that. There's no hard and fast rule that we have to keep acquiring.

Is anything going on in AI changing how you think about acquisitions? Yeah. Can you say more about this? This is the most transformative technology we've ever seen in our lifetimes and possibly will be. So if you look at the impact it's already having, it's fundamentally changing how everybody works. Like, and I say this differently when I was at Google, we democratized knowledge or information. This is democratizing intelligence, right? We all have in our back pocket something that gets more and more intelligent over time. So we basically have access to intelligence we never had. Like, I'm pretty sure two years from now, AI will get to a point of reliability where we will trust it as much as a human being who's an expert on the topic.

You talk to your nutritionist, you talk to AI and say, you know what? My nutritionist is not smarter than my phone giving me nutritional advice or my physiotherapist or my trainer. So you suddenly find that AI gets to a point where it's going to have so much data, so much tribal knowledge that it's going to be able to decide. You'll be able to torque it, saying, listen, give me advice which is at the frontier, which has got a little bit of risk, or give me advice down the mainstream. You'll be able to torque, saying, how much intelligence do you want? How much differentiation do you want in the intelligence that you're going to get?

So if that's going to be true, it's going to fundamentally change the way we work. It has to, right? A lot of organizations are structured in work that has been broken down into silos, right? Even the process of product development is split across eight different teams. You have documentation people, you have testing people, you have coding people, you have product people, you have UI people. So you've got eight different sets of people who combine together to build a product, which makes no sense. The only reason we did it because we sort of created a specialization because nobody could be great and amazing at everything.

But if you believe that you can harness all this intelligence in a way that one person could master all these. It crossed because they have very able assistants, which will do 90% of work for them. It fundamentally changed the way we get shit done, the way we build things, the way we do anything in our lives, the way companies are created. So that's going to be true. The shape of a company, the shape of the organization that we run today is going to be fundamentally different five years from now. I found one of my all-time favorite quotes when I was reading the book Zero to One. The quote says, the single most powerful pattern I have noticed is that successful people find value in unexpected places. And they do this by thinking about business from first principles instead of formulas. That is exactly what AppLovin has done with their advertising platform. AppLovin connects you with over a billion potential new customers in mobile games. AppLovin allows you to capture undivided attention. AppLovin ads are full screen videos that are watched for an average of 35 seconds. That is retention that blows other ad platforms out of the water. And you can launch on AppLovin in minutes. You set the goal and AppLovin achieves it. No complex setup,

no expertise needed. And AppLovin scales quickly. They can put your ads in front of over a billion potential customers. Other businesses have seen immediate results, scale to hundreds of thousands of dollars of spend per day, and increase their revenue by millions. So you want to get started quickly before all of your competitors are on AppLovin. And you can do that by going to AppLovin.com. That's AppLovin.com. Doesn't AI make cybersecurity companies more valuable? Yeah, I think even more so, more technology, more interconnectedness makes cybersecurity companies more valuable. Look, cybersecurity didn't exist 25 years ago because there was no connectivity. You had a mainframe, you logged in, it was secure. There's no problem. The problem is Now, David can log in from here into his bank account.

Now, that becomes an attack vector. So the more people who can log into shit from everywhere just expands the attack surface. I saw this morning Facebook says 3.65 billion people who are daily users. There's 3.65 billion people getting into their infrastructure every day. Every door into their infrastructure is a potential cyber attack surface. You do that across the world, I don't know, between the 8 billion people we have, we must interact with hundreds of consumer applications. There must be trillions of interactions every day, which are on a line that allows you to interact with some enterprise infrastructure.

The more you do that, the more likely that you need security across all those vectors. The more technology changes, you need more capability around security. For example, the products that will secure AI don't exist fully yet, because AI is so new. So, yes. It's good for our business the more you connect things. You're like a, I don't know, like more of like a stoic kind of person. You seem like you don't get stressed. Or you said like, I read something like you said your business doesn't stress you, which is a very unusual thing to say. Yeah, but the life shouldn't stress you. You should wake up every morning, do the best you can.

And then, remember, if you grew up sort of in India with Hinduism, it was like there's a strong sense of fatalism. All you can do is you do your best. Okay, I don't know about this. Explain how you grew up in like this fatalism thing. Remember, like, you've got 1.8 billion people in the country. You've got to make sure that they all understand that they can do their best. And eventually, there is a hand of God which dictates what eventually happens. Or it's the notion that it is uncertainty. You can't create full certainty. Things will happen to you which you can't control. The only thing you can control is what you do.

And if you do what you do really well, then you should sleep well. Because you can't get worried about everything that can happen to you from an uncertainty perspective. That is a sense of fatalism. That is what keeps society somewhat orderly. But you do understand it's easy to say that and very hard to apply for a lot of humans. Well, it doesn't stop anyone from trying, right? We try and control every outcome that we can around us. We try and minimize risk around us. We all do that. But at some point in time, we're going to say, I've done my best. Did you have this ability when you were younger and early in your career?

No. This is recently found in the last five years, yes. You're saying this is the last five years. So you're working at Google. High stress? More anxious person? No. Google's the best business. Like, you know, the search business keeps going. That was like the greatest. Like, that seems to me, and maybe I'm wrong, is like you had like a lot of success before that, but you know you're working on like, you know, once in a hundred year company at that point. You had it and you were young. You were in your 30s, right? It can get to your head. But I feel like the pressure to like, this is a huge opportunity.

This could be a once in a lifetime. This opportunity will change my life. It's funny, it didn't feel like that when you were there. Okay, say more about this. It just felt normal. It just felt, wow, this is this great rocket ship that's working. And remember, you're 34. You've never actually worked in any other company of a similar ilk. You're now at the center of attention of technology. And you're like, great, everybody's searching around you. Every morning you wake up, there are more searches.

And it's like very easy to sell as long as I can give them back more than that. We'll come back to Google in one second. So I want to get to this though. From the outside looking in, it seems like because of the proliferation of AI, the fact that it, there's like, I think you were just on my friend's show, I'm friends with John and Jordy from TPBN. And I caught a clip of that today and there was some kind of. Yeah, there was a discovery of a vulnerability called PHP, which is like used like 22 and a half million places, which is being used right now.

Yeah. And so my point is like, you've got to be waking up every day hearing more crazy shit. It's only going to get crazy in the future. Yes. And you seem to not allow yourself to be stressed by it, which from the outside seems like this would be the most intense, stressful part of your entire career. Why am I wrong about that? I can't do anything about it. And we all have to go figure this out. We've got to fix it. But stressing is not going to change the outcome. The outcome is going to be changed by us getting on and getting something to do with it, right? We all discovered this morning. I found out about it yesterday in the morning.

Our teams went and looked at everything we have to make sure we don't have the vulnerability. We found it. We blocked it. We found the patches. We patched ourselves. We said, how do we go protect our customers? Team worked overnight, built a patch. When it came out this morning, they announced their patch. We announced our patch. We put it out in the public domain. We're getting on the phone to any customer who has a problem. We'll solve it. That's all we can do. So how do you describe this philosophy, though? I'm just saying, wake up every morning. Do the best you can to the best of your ability.

Leave no stone unturned, and then let fate do the rest. Is this real? Yeah. Well, OK. When were you the most stressed or anxious in your life? I was the most anxious in my life. and I had to give a speech at my daughter's wedding. Is this the daughter that just started the fund? Yeah, this is the daughter who got married in February in India. What's her name? Ayesha. Congratulations. She used to work in marketing in Brex. Wait, she used to work in marketing for Brex? Yes. Kids don't take advice from parents for the most part. But I'm blessed that once in a while she'd listen to something and she'd go process it differently.

And I said to her, I said, you know, what excites you? I said, Dad, you know, it's exciting when marketing doesn't seem to be the most important function in the company. so I'm working in marketing, what should I be thinking about? I said, look, if you look around here in Silicon Valley, the most exciting jobs are people who get to talk to founders, people who get to understand what they do, get excited about business. If you're excited about business, you've got to think about venture capital. So she thought about it. She did her own research, figured out that she's going to go work. And she worked with Bill Maris at Section 32, and then she's getting married this year.

And she's like, I think I should start my own fund. I said, that sounds like a great idea. You should. So she's been through the motions. She's done a lot of research, figured it out. Then she started going around thinking who would be people who would invest in her. And she said, will you be my advisor? Now, this is the best thing a father can get. And she calls me once or twice a day. We talk about companies. We talk about what she's thinking about. It's a blessing. It's great. That's beautiful, man. When you think about your own childhood, this innate drive that you had to achieve, largely internal, I would imagine, did you get a lot of pressure from your parents?

No. My parents didn't tell me what to do. I used to come home from school, do my homework. My mom would be happy that I did it. She'd be chasing my sister around, trying to get her. Find out what the homework she had. I got my shit done. My dad didn't know how I got into university. He didn't know how I got into business school in the U.S. I just went to him and signed me $2,000. He was like, I don't have that. He said, can I give me $200? He's like, yeah, I'll take $200. I took $200 and showed up here. Then he sent me $2,000 afterwards to pay part of my tuition, and that was it. You don't put any pressure on your kids?

No. Like, how different are you as a parent than your parents were to you? That was a different era. At that point in time, parenting was different. Parenting is different now. Parenting in India is different. Parenting in the U.S. is different. So, you know, you obviously have all those differences that come into play. I have two younger kids who are 11 and 10, so more involved in their lives than I was with my 29-year-old. Why? More time. I consciously try and take out time, and I'm sure my kids will say it's never enough, and my wife will say it's not enough, but I try and take out time as much as I can.

So it's different. No, I don't believe in putting pressure on my kids. The kids have to be able to express themselves and do what they believe is best. Look, I have seen some bizarre thing. I don't know how many people have been born since humanity started. It must have been the tens of billions, right? No, I think it was, I mean, we read about this a long time ago. It was like over 100 billion. Okay, 100 billion people have been born. It's a well-known problem. Every kid has a parent by definition. And even now we struggle with parenting as a problem because there's probably so many variants of parenting that most people can get it wrong.

So I just want my kids to be happy in their lives. If they're happy, my mission is accomplished. Because I've seen so many scenarios where kids are not happy. And it's not clear where things go wrong. It's not clear from a parenting perspective or it's in the DNA. It's in circumstances. So I just want to make sure my kids are healthy, happy, and balanced. If I can achieve that, they can do whatever they want. I love the framing you just put on there. It's like everybody's had a parent. Parenting is a known thing. It's been around and we still don't have it figured out. No, you show me where's the ultimate guide to parenting.

I'm particularly interested in this because most of the biographies I read, obviously the person usually starts out, there's some people that are born into wealthy families and they wind up cheating a lot. Obviously most of humanity is not wealthy, so therefore most of the people you're going to read about weren't.

Toby Luque was on this show earlier this year. I'm going to see him again in like two weeks to record again. And his whole point was like, we're going to look back on the year 2026. Because of AI, like every business is up for grabs. So every business is being transformed somewhat, right? But I feel like yours might be the most out of anybody else I've had on the show. No, no, no. So let's break it down, right?

Yeah, from outside, that's what I was assuming was the case. That's what I was like. It's always assumed that CEOs are trying to maximize their businesses from the outside.

Generally, that's a good rule. Yeah, but we talked about no one wakes up wanting to lose, but a lot of people lose every day. So this is what I was trying to get to. Who do you go to when you want to learn about the frontier of AI? Who do I go to when I want to learn more about AI? There are different people. I spend, I want to say, at least four or five hours a week with AI founders of some sort. Because these kids are young. They possibly worked at OpenAI. They probably worked at Google somewhere. They've got these companies. They're very kind. They spend time with me. They try and tell them what they do about works.

So I learned about open-weight models. I learned about training. I learned about training data. I learned about guardian agents. I go around, I talk to tons of people. I talk to probably five or 10 cyber startups a month, maybe 15. I'm trying to absorb how they're thinking about it. Because in a bizarre way, this is a new and developing science, for lack of a better word. There are no real experts. People know how to do their shit. Everybody else is trying to imagine the implications to everything else around them, and they're trying to build a mental model so they can build product and go win in this category.

right there is no concept of you know data labeling before you started having self-driving cars Now that's turned into reinforcement learning, simulation models, neural networks that are trying to simulate data so we can train AI. So you literally have to stay in the conversation with tons of people to understand and absorb what people are talking about. So you just have to spend a lot of time on Twitter, spend a lot of time talking to people, spend a lot of time reading stuff. It's kind of like half I understand, half just gets through the other side. I can't absorb everything. That's how I learn.

Now you brought up another thing I wanted to ask you about. What's behind your new presence on X? Well, I think I said that. I was giving shit to one of your fellow podcasters. Harry? Yeah. I was giving Harry shit saying, this is great for you. You keep bringing all of us in. You build your own brand. All of us are effectively props for your brand. He's like, well, that's your fault, not mine. I'm like, what do you mean? He's like, well, you give the right to build your own brand if you want to. He's just don't. I'm like, how would I do that? He's like, well, go tell people on the next. What do you think?

You have a lot to say in a podcast. Why do you wait for me to ask the question? That's a good point. So then he told me to tweet every day. I'm like, okay, and then... I'm enjoying your tweets. And you are tweeting almost every day. No, no, it's at lower frequency now. I listen. Oh, you can't listen. You're really good at it. But, you know, you can only put your foot in your mouth if you say something too often because you almost have to not feel the pressure to tweet every day. So I like that advice. Don't feel the pressure to say something all the time. You end up making it a job. I don't want to make it a job.

I want to do it when I have something I want to say. So I think I say stuff when I want to say stuff. People ask me how much time I spend. Who writes it? Actually, I do. I just write it in the back of the car. It's obvious that you write it. Come on. You know, once I had it checked by Claude or something, and it made some grammatical edits, and people just gave me so much shit. Oh, I saw that one. You're like, you're writing AI. My idea is AI, I check it, and I'm never going to do that again. No, you're really good at this. In fact, there's a guy that's always on this camera that gives me a heads up when we hit a certain time, and he just gave me the heads up, and I was fucking shocked at how fast this time went.

So that's usually a good, uh, it's a good sign, man. I really appreciate you doing this. This was awesome. We've got to do this every few months. I hope you enjoyed this episode. Please remember to subscribe wherever you're listening and leave a review and make sure you listen to my other podcast founders for almost a decade. I've obsessively read over 400 biographies of history's greatest entrepreneurs searching for ideas that you can use in your work. Most of the guests you hear on this show first found me through founders. Thank you.