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Rod, welcome to the podcast.
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Great to be here, Jake.
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Thank you so much for joining today.
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I’ve got a long list of questions for you, Rod.
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First of all, just want to highlight how cool it is that you get different touch points with different people,
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whether it’s online to start with or maybe a physical interaction,
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and then, okay, we’ve got to do a podcast, and that’s the case with you and I today.
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So very excited for this conversation.
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um first question for you rod is the the nostre network like why why does it exist why are you
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even using it and let’s spend lots of time talking about that because i’m super excited about it as
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well but you’re building on nostre and i’d love to dig into like you know your your process to
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get into today yeah great jake i mean i’m a big nostre fan um let’s i mean if it’s okay i’ll just
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give a bit of background in terms of who I am and how I ended up here. Absolutely, please.
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Because that’ll explain it all. So my background, I started a technology company about
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January 2012. I grew that up for six years to list it on the ASX. In January 2018, I then ran
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that for six years as a public list co. And, you know, then I stepped aside and new management have
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taken it forward and they’re doing their own things. But the, you know, that journey of raising
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and building technology over a number of years taught just so much, right?
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I mean, we were, you know, I guess 2012.
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So, you know, a good period in the middle of that free money era
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that I think Bitcoiners who know about monetary policy
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will know what zero interest rates does to venture, for example.
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You know, we started at a good period there where capital was available,
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where we were able to grow something really quickly and we did so.
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and then you know we were able to to i guess be successful at that right early investors invested
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you know at a say a million dollar pre-money and ipo was at 40 million we were australia’s first
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ever equity crowdfunding exit uh you know even then kind of listing and running through covid
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we were able to you know take a essentially a travel technology company through the end of
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travel as far as public investors were concerned of at the time they said you know this is it
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And so we’re there on the receiving end again of more, say, policy decisions that, no, we’re not allowed to leave Australia.
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Right. And so we can say again that maybe there is there are policy impacts here to running a business in a vertical.
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It has to be a favoured vertical. But we got through. Right.
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We reduced costs.
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We got through on a kind of a method that didn’t involve raising stats of dilutive equity at the bottom of a kind of a valuation trough.
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Instead, we cut costs, but we took care of people and we got through.
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We made sure every supplier was paid.
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We came out the other side.
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It’s a really interesting story.
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And so then again, on the flip side, we benefited.
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you know there was a moment there in markets where if you were uh you know seeking a say a
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barbell to your the world is ending pandemic thesis but what if i’m wrong well you really
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want to invest in a flyer and so you know here’s a travel technology startup that i can invest in
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and we became you know able to i guess on the outside benefit from that uh raise a large sum
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of money attract some very exciting investors uh we were the 10th fastest growth company in
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Australia that year, just flying out of the traps. And I took the thing to bigger than it was pre-pandemic
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and said, I’ve done my six years public and we’ve recovered the company and it’s time for me to go
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and explore other things. And I guess through all of that, a few things. One, learned the importance
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of monetary policy and fiscal policy on markets. There’s stories to tell about how capital works
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that both in terms of private market investing
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and also public market and accessing capital there
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that is just so dependent on the environment you’re in.
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And then also through the pandemic learned, well,
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what happens when suddenly narratives are completely controlled?
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What happens when suddenly your industry is completely shut down
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and started to listen to what Jack Dorsey had been through,
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sympathizing with them as the head of a smaller list co and saying, well,
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I can understand exactly the kind of purchase he was on. But then, you know, hearing, hey,
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there’s this solution, you know, and a solution that seems reasonably resilient. If you’re talking
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about, you know, communication, resilient to different policy decisions. If you’re talking
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about monetary policy, well, it’s riding on Bitcoin, which is resilient to certain policy
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decisions and we’re sitting here as you know I’ve built this company from zero twice I’m looking for
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my next run to be built on something resilient quite besides what AI has done which is a whole
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other thing as well but these these are the things that lead me to kind of Bitcoin and to Nostra
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I mean I’m super excited to unpack them all for you but that’s roughly why I’m here. Awesome Rod
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okay and it’s always interesting where conversations go because today I was like I’ve got
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so many questions for Rod about the last decade, but I was going to try and maybe weave them in
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later to like the NOSTA story today, but let’s flip it around and do exactly what you’ve done
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because actually the chronological order is also really nice. So the business that you set up and
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IPO was called J-Ride and you kindly shared a link yesterday, which gave some great context on like
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the problem, the solution that you came up with. Most of the people listening to this won’t have
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listened to the equity investors that you were talking to. So as a founder of a business,
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The philosophy of build it and they will come in Satoshi, in my mind, has never been better represented.
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Like he just built this thing, he, she, they, and we’ve ended up using it.
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It’s built on the back of a lot of other work, which is often overlooked.
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But then on the flip side of that, you’ve got, okay, do as much customer research as you can.
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Maybe you came across a problem of your own and do other people need the solution that you can create and go and fill that need?
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and listening to the interview that you did yesterday you came down more in that side of
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like okay I think there’s a need for this business and clearly there was so take us right back to like
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the genesis point of like okay I know I want to start a company what skills did you have who did
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you know how did you even begin to get it off the ground yeah so it’s a good question so uh look for
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those who don’t know Jay right uh and at the time that I was running it and it’s doing something
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different under new management now but at the time that I was running it broadly speaking it
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went like this. Jake have you ever traveled? Yes a lot yeah. And so you kind of be familiar that
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there’s a couple of important parts to travel one is you know what is great to do in a location
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and the other is how on earth do I get to that place and the travel industry is very good at
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selling dreams about you know amazing things to do and it’s very good at selling certain parts of
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those experiences but it was very bad at the time that i started about actually helping you get there
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you know flight aggregation had become a thing right webjet and sky scanner these sorts of
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businesses have become a thing but what about that last mile and you looked at travel travel
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at the time again that i had started this and was running this had built a stack of really nice
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aggregator models right so you had booking.com hotels webjet for flights sky scanner for flights
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so forth but no aggregator for the last mile this was pre-uber even right you know taxis all around
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the world we’re all completely different companies uh how do you as a person actually work out how to
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get around and and not just work it out how you access it and so we stepped into that vertical
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we said well like as a macro kind of idea that makes sense as a traveler with a lived experience
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i’ve been stuck in places and i wish i knew how to get around you know let’s step into that with
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with um aggregate them all uh it made sense from macro point of view it made sense from markets
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point of view, you know, taking a look at how Australian public equities had, you know,
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played out over the previous years, Australian equity investors were starting to get familiar
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with marketplaces, right?
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Because you had, you know, seek for jobs to marketplace, you know, domain for properties,
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it’s a marketplace, car sales for cars, it’s a marketplace.
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So they kind of understood marketplace dynamics, marketplace defensibility, all of these things
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We said in a macro sense, it makes sense.
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In an equities sense, it makes sense.
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Okay, let’s go raise some money and let’s go build a company.
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And so, you know, we did.
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But I guess the thing that is, I guess, the lesson that I didn’t know at the time and that I’ve subsequently learned, I think this is an important lesson for all founders.
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Because when you’re a founder, and I think I’m probably speaking for most founders, you’re starting a company because you don’t actually want a job.
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right you you want to be in charge of a thing right you don’t want to be an employee
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the very moment that you raise equity funding you are going to become an employee yes well
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maybe not the very first moment you might have a very amazing seasoned investor who says you know
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you’re the visionary run with it but you always have to go to the next stage right because that
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investor is looking for fast flow if that investor is looking for a future liquidity point therefore
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you must be courting other investors.
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Those investors are going to want still further amounts of control.
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You will get still further diluted and so on.
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You’re on track.
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And eventually you end up on a publicly listed board
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with multiple other board members
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holding a single digit percentage of your company
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and they’ll disagree with you.
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And they’ll tell you what to do.
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Interesting.
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And that sounds like a job to me.
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And so I think a lot of people at that early stage,
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they don’t kind of realize that they’re buying themselves a job
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with the moment you raised, Mike.
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And there’s lots of opportunity these days.
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And again, if we’re going to talk about AI,
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to avoid that track completely if you wanted to.
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Yes, and for sure we should talk about it.
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Truly interesting time.
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Yeah.
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And again, just to reference the kind of starting point is
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even just recently, I am in Byron Bay at the moment with my family
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and we had some tickets to go and watch Oasis in Melbourne,
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which is freaking awesome.
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and so we were flying down to Melbourne and it’s a it’s a trip I’ve done a lot over the last two
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years and almost every single time we land in Melbourne I’m like how are we going to get from
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the airport to wherever we’re going whether it’s my mother-in-law’s place or to a hotel
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and I’ve used different chauffeur companies essentially transfer businesses whatever you
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want to call them so when I heard you describe the problem of j-ride like oh my god I’ve experienced
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that problem so many times when you you basically reach the end of one travel company’s service
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or product but it’s like well now i don’t know where the fuck i’m going next and yes like uber
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might improve that you could get a car directly somewhere but even then it’s like well actually
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now i’ve got 12 bags and three kids and two strollers and do you know what i mean it’s like
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they’re obviously more niche in terms of what you’re looking for you might have a surfboard
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you might be disabled who knows right and so that that problem point really echoed to me is like ah
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what a great idea of course there’s a good marketplace for aggregating that step um and
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clearly it worked right you’ll hear how many years later um yeah well i’m no longer running that
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company but the business really went you know yeah that’s right and so the business now continues
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it’s a it’s a listed enterprise it’s under new leadership and they’re they’re doing exciting
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things in sass uh you know i look forward to that business kind of continuing to make big runs but
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But the journey of being a founder there was kind of a really interesting layup into why Bitcoin, what it sold in capital markets, why NOSTA, what it sold in go-to markets.
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And there was a moment in, wow, it was three years ago now.
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Three years ago, I was still in Jayride and GPT-3 came out.
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Do you remember how much of a splash that made?
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Yeah, people were excited, yeah.
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Yeah, suddenly everybody’s talking about AI.
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And it was a really fascinating moment.
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So there you are, right?
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You put yourself in these shoes.
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You’re CEO, managing director, founder of a listed tech company that spent, oh, $25 million over a decade building software with the expectation that that’s going to be a technological defensibility that no other company has been bothered to invest the same amount of money in solving the same problem because you’re already there.
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and GPT-3 comes out and, you know, it’s,
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I think we all remember now in retrospect how average it was
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compared to current models, but GPT-3 comes out
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and, you know, you can see that within a few years
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you’re going to be able to say, you know,
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hey, model, give me a replica of JRide’s code base.
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Give me a replica of ABC company’s code base
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and that it will go, okay, there you go.
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It’s done, yeah.
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for broadly free and broadly instantaneously.
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And, you know, that wasn’t what GPT-3 was able to do,
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but you were able to look at it and say,
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how many years until that’s possible?
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And all of that technology note that you’d so painfully built
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over so many years is just, you know,
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holding a residual value of zero.
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And how many competitors can now suddenly come
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and be a fast follower of your, you know, successful model?
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And it was three years ago when I said,
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it’s probably a decade away, but still, you know,
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changes your investment horizon.
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You’re no longer building for the eons.
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You’re building for, well, I’ve got to make sure
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that this thing delivers within a five-year span
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because within 10 years I’m going to have fast followers, right?
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Which brings us to now, right?
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So I’ve stepped out of J-Ride and I’m doing essentially
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AI-led development.
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Six months ago I said, I wonder if I was wrong by seven
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and a half years.
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And I can confirm I was wrong by seven and a half years.
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The moment where you can sit down with a robot and say, I’d like to duplicate X and have it not instantaneously, but pretty fast and not free, but pretty cheap, completely duplicate somebody else’s business model and code.
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It’s right now.
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It’s possible to do today.
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Wow.
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And the ramifications of that are just so extraordinary, aren’t they?
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um rod to to just dwell on this for a moment the the job that you found yourself in as the founder
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of a business that was quote-unquote your idea and your business but suddenly you’re stock listed
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and you’ve got single digits of the business you’re no longer in control yes there’s value
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that you’ve generated which is great but um in some ways you’re an employee which is a fascinating
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insight that a lot of people won’t have considered 2023 you mentioned that the the management of the
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business changed um how did that feel you know 10 years of your life going into something and say
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okay well maybe this isn’t what I want to do with my time it was an interesting moment um but I
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wouldn’t I wouldn’t say it was a negative moment you know you you can become too much single track
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on a single idea for too long and I think I was also kind of really clear with myself that my
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special skills are turning nothing into something and that’s a very different game to running 150
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person headcount listed entity um and i mean a very different game and you know i learned that
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game and that’s fine but you know given the opportunity to continue to run you know 200
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person listed entity uh or you know get my hands dirty again and get on the tools and build
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something that’s not been seen before.
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I mean, that’s the thing that excites me.
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So, Rod, keep going.
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So where is that excitement taking you today?
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I think that’s awesome, by the way.
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What a great vibe.
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Yeah, look, so the…
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It just comes back to AI.
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So think about just how profound this is for a second.
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You know, 10 years ago, you are a non-technical co-founder
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who wants to start a technology company.
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Okay.
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First step, get a technical co-founder.
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You need that, 50% of your equity.
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And then second step, go and raise a venture round
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for another 25% of your equity so that you can plow that money
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and some stock options into getting some more engineers.
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Okay, great.
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Now you’ve got a technical team and you’re off.
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You get to start now.
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You own 30% of your company, right?
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Yeah, wow.
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And you go.
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And you go for 10 years and you end up with a single digit.
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Now, compare and contrast.
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You’re a non-technical co-founder today and you go to Claude and you say, give me a prototype of X.
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And it just can.
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And you can get out the gate, you know, without the venture, without the technical co-founder even.
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You can get out the gate holding 100% of your company.
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And very fast as well.
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Yeah.
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But even without speed, even if you had to, you know, beat it to death over many months, you can still do it.
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Yes.
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And you can learn the skills as you go and it’ll teach you the skills as you go.
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Wow.
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And so, yeah.
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Please don’t carry on.
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Oh, no, I was going to say.
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And so how fundamentally does that change what it means to start a technology company?
0:17:19
Well, it radically changes things.
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And to share an experience of mine.
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So I have tried many times to found a company and failed many times.
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And there’s all sorts of different reasons why.
0:17:31
But one experience I had was going through what is called talent investing.
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So there’s some programs, one’s called Entrepreneur First, another called Antler.
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I don’t know if you’ve ever heard of these, but they’re basically big funds that raise money on the idea that you can put two people in a room together, give them three months to come up with a prototype, and they’re going to build the next Google.
0:17:54
And it’s like a real dragon’s den, in a sense.
0:17:57
and everyone’s in there scouting each other out like 100 people in the room it’s like who do you
0:18:01
want to work with who do you not want to work with and again as a non-technical founder it’s like okay
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i’ve got commercial skills i’ve got industry expertise in this one specific niche but don’t
0:18:12
really want to work in that um i need someone who can build this thing so immediately given 50 away
0:18:19
and then as you said you’ve also got to raise the money and so between the two of you then selling
0:18:24
more equity to the program that you’ve come through.
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And so the headache involved in A, getting the talent
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and B, getting the funding is massive for someone
0:18:36
who’s basically an ideas man that can make something happen.
0:18:40
You given away more than half just to get to the point of starting So it a massive change and affects someone like myself hugely as well Yeah one of the smartest investors and wealthiest kind of investors we ever had
0:18:54
was very straightforward that if you really think
0:18:58
this is going to be a big and exciting company,
0:19:00
then you should try to hold on to as much equity as you can.
0:19:04
Because why wouldn’t you want to have all of the shares
0:19:07
in this thing if it’s going to be as huge as you say?
0:19:09
and that’s obviously them being a uh you know them slightly negging the investment thesis and
0:19:16
asking for me to respond but it is also true and it it flies in the face of what you used to read
0:19:21
about in tech crunch which was fundraising round fundraising round fundraising round now these two
0:19:25
things can’t both be true you know either it’s important validation that you’re successfully
0:19:30
getting investors all the time or you actually want to hold on to your company as one of those
0:19:35
I mean, they can’t both be true statements all the time.
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And I’m sure there’s a middle ground,
0:19:40
but I think a lot of people are attracted by the glitz and the glam of the funding.
0:19:45
And also in an era of free money, you know, there’s money.
0:19:48
So you can get it.
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Go and get it.
0:19:52
Today, you don’t need it.
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Not only is it scarcely available, but also you don’t need it.
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That’s kind of a radically different play.
0:20:00
You raise your venture.
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You’re now on a track.
0:20:03
You know, the VC-fueled hamster wheel.
0:20:05
you’re going to keep raising, you’re going to keep growing, you’re going to keep hiring,
0:20:07
you’re going to keep diluting. And you end up having to build a very, you know, a tiny little
0:20:12
narrow window of valid businesses fit that mold, right? It has to be, you know, in 100 million plus,
0:20:20
and it has to be a trade sale to a industry dominant player, or it has to be an IPO,
0:20:25
because we as investors who are putting in the money need our liquidity.
0:20:30
Where’s our exit event? The little window that you get to play in becomes increasingly small,
0:20:35
But the moment that you instead own the company, I mean, the opportunity to build different templates of business become wide open, wide open.
0:20:45
I mean, how much money do I truly need to happily live by the beach with my daughter and play volleyball on the beach?
0:20:50
It’s probably not, you know, a multi-hundred million dollar company, to be frank.
0:20:55
You know, and with venture, you can’t play that game.
0:20:58
You can’t decide to take, you know, three months off and come back to it soon.
0:21:02
You know, these sorts of things are forbidden.
0:21:04
they can’t be done and so again ai is fundamentally i think changing this game for founders
0:21:09
and what a great time to be on the outside and go after it oh my god i couldn’t agree more one
0:21:16
small example but something that’s happened for me in just literally the last few weeks
0:21:20
is i had i had a strategy for the podcast that um was incorrect and i went 10 10 months absolutely
0:21:29
hammered it hired an editor hired a producer we threw a lot of content out there hit almost 250
0:21:35
000 views across all the kind of traditional platforms which i’m really pleased with but
0:21:39
what i realized is that i was chasing something i didn’t need to chase and i was getting stressed
0:21:44
about something i didn’t be stressed about and selling views is a commodity business and therefore
0:21:50
how am i any different to someone down the road with another podcast with another opportunity to
0:21:54
sell a banner or a bio mention or ad real or whatever you’re in advertising and given the
0:22:01
the fortune i’ve had to invest in bitcoin when i did it completely shifts the playing field because
0:22:07
you have a deflationary savings tool that’s increasing in purchasing power whilst you do
0:22:12
nothing and i say nothing quote unquote you know homeschooling kids or whatever but you can choose
0:22:17
to do different things with your time and chase the funding and so i have let pat and michael go
0:22:23
cheers to those guys for getting me there this far but it’s like what does ai mean for a podcaster
0:22:28
what does a one-man media business actually look like and of course this is where nostor comes into
0:22:34
it because the platform risk of traditional things is huge like you can just get kicked off you can
0:22:39
have hundreds of thousands of subscribers on youtube and they’re like oh do you know what
0:22:43
these guys pay us more ad revenue over here and you’re talking about stuff they don’t like so
0:22:47
you’re newt and it’s going to be some small term in the community guidelines the point of explaining
0:22:52
all this being I have produced and released only one episode since this decision and I’ve got one
0:22:58
waiting in the wings to release on Friday but I’ve been able to use Riverside to produce you know to
0:23:05
edit to get clips to create captions and I’ve been able to do it to the standard I want rather than
0:23:11
necessarily pay someone else to do it for me that does it to what they want and I’m comfortable with
0:23:15
how it’s been and you think wow i’ve just probably 20x like i’ve cut the cost by 20x essentially if i
0:23:25
think about what the monthly running costs were and what they will be now i’m not paying for my
0:23:29
time but that’s a big big big shift in just that one tiny example as to how you can be more efficient
0:23:35
as a solo operated business and i call it business quote unquote really what it is is a
0:23:41
creative venture that I wrapped up as a business and got carried away. But I’d love to know, Rod,
0:23:47
so what I love about someone like your story is you had an idea, you took it through the
0:23:55
entrepreneurial route, you had an exit, and you’re now refocusing all of that expertise to go, I’m
0:24:01
going again. So what are some of the problems that you’ve stumbled across that you’re like,
0:24:05
oh, that’s something that’s caught my attention, or this has caught my attention? And how do you
0:24:09
decide where to point your energy and your skills?
0:24:15
So I’m running a new NOSTA venture called Show Show at the moment.
0:24:18
I guess we’ll get to talking about Show Show in a roundabout way.
0:24:21
But the challenge that I set, I guess challenge,
0:24:26
the thing to validate that I set myself six months ago was,
0:24:29
can you right now start a tech company with no technology people?
0:24:33
Because again, three years ago, I had the view that’s going to take 10 years.
0:24:38
I thought maybe I’m wrong by seven and a half years.
0:24:41
And so let’s say you want to do that.
0:24:43
That’s your chief risk that you’re going to try and fail and that it’s not possible.
0:24:47
And in startup, the number one thing to do always is validate your riskiest assumption first.
0:24:52
So that’s the riskiest assumption.
0:24:54
How do you then subordinate all other concerns to validating only that assumption?
0:24:59
Well, what are the other risks when you’re going into business?
0:25:02
Funding risk?
0:25:03
Okay, I’ll bootstrap it.
0:25:05
Business model risk?
0:25:06
Okay, I’ll copy someone else.
0:25:08
So how do you just get focused on just the development side of the problem?
0:25:14
Can I train an AI?
0:25:15
Well, I’m not going to do a model-based.
0:25:18
I’m not going to teach a model.
0:25:20
I need something that’s in the training data already.
0:25:23
Okay, great.
0:25:24
How do I build something that’s going to ride on existing open source rails
0:25:28
so that I can just feed this thing, read this GitHub,
0:25:32
and tell me how it’s done?
0:25:33
All right, so I’m looking for something I can bootstrap, something with no business model risk because somebody else has already run the model successfully and it’s a growth vertical, something that’s going to sit on existing training data that’s already in the models and also many open source GitHub repos that I can feed it if it’s missing.
0:25:53
to narrow the playing field down, right?
0:25:56
And then that’s where you want to play.
0:25:58
And within that little playing field,
0:25:59
then you can say, okay, well, now let’s validate.
0:26:01
Can the AI do its work?
0:26:02
I’m giving it the easiest layup in the world.
0:26:05
Can it do it?
0:26:06
And so that’s how we ended up in the playing field
0:26:09
that is where Shoshosh lands.
0:26:12
Just to pitch you Shoshosh for a minute, okay.
0:26:15
Have you ever tried to sell product online, right?
0:26:19
You go to eBay, you create a boring listing.
0:26:22
Maybe it’s got a nice photo.
0:26:24
Maybe you were too busy.
0:26:26
And you spend a lot of time writing a whole bunch of copy.
0:26:29
And now it gets lost amongst 20,000 other people that are selling the exact same product.
0:26:33
But you, Jake, have a podcasting platform.
0:26:36
You’re an influencer.
0:26:37
You have a social media presence.
0:26:39
You have all of these other assets that you apparently, in traditional e-commerce, aren’t allowed to bring to bear.
0:26:45
You have to play within their little boxy shape of creating a listing.
0:26:49
Well, no longer because there’s a new vertical.
0:26:51
and it’s called live streaming sales.
0:26:55
And there’s lovely businesses in this vertical
0:26:57
like Whatnot or Show Show or TikTok Shop.
0:27:05
And these businesses have become
0:27:07
an incredibly fast-growing vertical.
0:27:09
Live streaming e-commerce.
0:27:11
You hop on a live stream, you’re here,
0:27:13
you’re on video and you have your product.
0:27:16
Okay, now this is for sale, guys.
0:27:18
Sold.
0:27:19
Okay, next product.
0:27:19
think about how engaging that is to be there in a live chat with everyone talking and bidding and
0:27:25
buying together you know for you as a social media personality or an influencer or somebody
0:27:30
who’s just a content creator to be able to create that content and turn your sale into a real show
0:27:35
is something that the traditional e-commerce platforms don’t do and it’s a way for you to
0:27:41
clear vast amounts of product really quickly in fact that that vertical in china is the fastest
0:27:47
growing vertical in e-commerce. In 2020, it went from roughly zero to roughly 10% of e-com.
0:27:53
They reckon when the numbers finally settle for 2024, it’ll be 25% of e-com in China is going
0:27:58
through live streaming videos. 25% of e-com in China goes through this new vertical.
0:28:04
That’s massive. That us in the West are completely sleeping on besides,
0:28:08
you know, a tiny feature in the back of TikTok that most TikTok users probably don’t know.
0:28:14
and I’d never even heard a TikTok shop till just then yeah yeah and and what not I mean they’re
0:28:18
they’re lovely they’re growing fast they’re doing 6 billion US GMB a year but they sell Pokemon cards
0:28:24
unless you’re into Pokemon cards you probably haven’t heard of what right so there’s this
0:28:30
there’s this vertical it’s fast growing business models very well worked out it’s it’s e-com it’s
0:28:35
the oldest business model on the internet and what’s it actually boiled down to it boils down
0:28:42
to e-commerce shopping technology, which is, I mean, I’ve been doing it for 12 years, but
0:28:46
also there’s vast amounts of open source code on that. And live streaming, which is also,
0:28:52
I mean, it’s also, it’s literally in the training data, right? You know, OBS was an open source
0:28:58
foundation from the get-go. So open source training data, fast growing vertical, well
0:29:04
worked out business model, can the AI do it? And so just from the get-go, here’s whatnot,
0:29:10
here’s TikTok, here’s a whole bunch of NOSTA software,
0:29:13
here’s a whole bunch of e-com software,
0:29:15
work out how to use that to build this.
0:29:17
And that’s how we got started.
0:29:19
And again, the takeaway is it can absolutely do that.
0:29:23
It can over the course of time, you know, again,
0:29:25
if you’re willing to spend the money on the tokens
0:29:27
and really grind it out,
0:29:28
it can build a feature for feature competitor
0:29:31
to any business you want to point at.
0:29:34
Fantastic.
0:29:35
And so one thing that springs to mind for me
0:29:37
is the, and if there’s anything that Bitcoin teaches you about,
0:29:42
it’s counterparty risk.
0:29:44
There’s many things it teaches you,
0:29:46
but one major one is counterparty risk.
0:29:48
And so having your value stored in self-custody,
0:29:52
no one can take it from you,
0:29:53
can’t be debased on the back end.
0:29:55
When you really understand how safe your value now is
0:29:59
versus how it was before in a diversified portfolio
0:30:03
of stocks and bonds with a finance manager somewhere,
0:30:06
it completely changes your life.
0:30:07
and I wonder with AI
0:30:10
and you touched on using open source for example
0:30:12
is there kind of counterparty risks
0:30:14
to building what you’re creating
0:30:16
i.e. like how do you actually do that
0:30:20
so could Grok switch you off
0:30:23
if you were using Grok
0:30:24
or something along those lines
0:30:26
I think it’s quite early still
0:30:30
I think there’s lots of ground to cover
0:30:31
in that landscape
0:30:32
you can if you want to run your own models
0:30:35
I don’t
0:30:36
I mean I could
0:30:37
you could if you wanted to have your own hardware sitting in a rack
0:30:41
and have your own models running on it.
0:30:44
I guess I see enough competition to believe that the model companies
0:30:48
aren’t yet going to pull the rug on people.
0:30:52
And we’re not just talking about the famous US-China competition
0:30:56
where China wants to defeat the US’s AI advantage
0:30:59
or whatever the tabloids would say.
0:31:03
Just the pure and simple of is it Grok or Anthropic
0:31:06
core chat GPT that’s going to win as the best coding model and attract all of the dead income
0:31:11
because we’re spending a lot of money in aggregate not much each relative to the cost of hiring an
0:31:18
engineer but in aggregate I mean there’s there’s money being spent there and so who’s going to win
0:31:23
it and I look at the companies and I say they’re all broadly I mean they’ll they’ll haggle at this
0:31:29
point if you ask them but they’re all broadly interchangeable right and if chat GPT turned me
0:31:34
off tomorrow then i’m using someone else and i don’t care and literally the software will allow
0:31:40
you to switch an api key and away you go it would take me five minutes uh and so i don’t i don’t know
0:31:46
that we’re going to get rugged by ai companies just yet but even if that kind of in the future
0:31:50
becomes a risk i i guess i imagine it’s only going to become more accessible than it is now
0:31:55
and it’s only going to become easier and easier to run your own capable credible model on your
0:31:59
own hardware. One which as a builder, like the trend is your friend. And I would agree with you
0:32:06
there completely as you lay that out. It’s like, hang on, there’s probably gonna be more of these
0:32:09
things. It’s probably gonna be more of a commodity style business as a product. You know, you’re
0:32:15
gonna be competing on price against people. Yes, some of them will be more sophisticated than
0:32:18
others. There’ll be different reasons you might use one from a different one. But should you get
0:32:23
into hot water with one particular company, well, there’s going to be armies of others that you can
0:32:27
go to. So that risk actually is very low as I think about it.
0:32:33
Although it comes to margin, well, if we just dwell on this for one more point,
0:32:37
at least some of the AI apocalypse sort of stuff you hear about is, well, you know,
0:32:43
if we’re going to subordinate all thought to these computers, well, then which company
0:32:49
are we trusting to do this?
0:32:50
Well, then we’re in a lot of trouble.
0:32:51
Right. And are we actually going to end up where all surplus margin of all technology
0:32:56
businesses in the world simply accrue to open AI? And again, if you ask open AI, their answer is
0:33:02
absolutely, we’re going to command all margin in the world. But I don’t think it’s true. Because
0:33:06
again, the models are broadly interchangeable with each other and clearly very imitable because
0:33:12
look at the field of players that has cropped up in just three years. I would say actually that
0:33:17
none of the AI companies will ever be able to hold on to surplus margin because they are so,
0:33:22
I guess so boilerplate and imitable.
0:33:25
So where does the margin go?
0:33:27
If it’s not no longer living with, you know,
0:33:30
fat, juicy Silicon Valley companies
0:33:32
because their technology mode has been eroded
0:33:34
and it also doesn’t accrue to chat GPT and clones
0:33:38
because they’re so able to copy each other,
0:33:41
I think it goes to us.
0:33:44
As founders of small businesses and consumers
0:33:47
who use those businesses,
0:33:49
I think it ends up with,
0:33:50
let’s call it instead of fat company i think you end up with fat user which is the same premise as
0:33:56
nostr actually and the same premise bitcoin is the power accrues to the individual uh and so what a
0:34:03
what a wild time to live yes oh rod and what an awesome explanation so let’s unpack that a little
0:34:10
more the the technology moat for the large well-funded cantillon effect in many way
0:34:19
businesses is actually filtering through to the user so as the founder of a business you can
0:34:26
essentially be more efficient in the marketplace so you still provide a service or a product to
0:34:31
someone and they’re willing to pay for it but within your business the operations can be more
0:34:36
efficient as a result of applying ai and so the customer gets a better deal and the founder gets
0:34:42
a better deal but the technology provider is actually getting slowly eroded over time because
0:34:48
of the nature of how that technology is created. Imagine being the CEO of a listed Silicon Valley
0:34:54
tech co and you maybe your DocuSign right you make you make software that signs PDFs which
0:35:02
Acrobat also does you’ve got a 13 billion dollar market cap somehow and you have to turn up every
0:35:09
quarter and say how you’ve defended every dollar of that and how you’re going to come up with some
0:35:14
amazing growth play to double your investors returns over the next decade. And meanwhile,
0:35:20
literally anyone with an LLM and five minutes can make a clone of your software.
0:35:26
What do you do? I don’t think you can do anything. I think that there’s a landscape within 10 years
0:35:33
where there’s 100 competitors nipping at your heels, stealing customers one by one,
0:35:37
which you can’t afford to lose because you need to continue to provide a growth outlook to your
0:35:42
investors. How do you? I mean, you possibly can defeat one fast follower by saying, oh,
0:35:47
I’ve got a bigger marketing budget. But how do you defeat an army of thousands of fast followers who
0:35:53
are all building exact clones of your software with a few tokens in their weekend? I don’t know
0:35:59
that you can. DocuSign, $13 billion market cap. How do they defend that? Slack, broadly speaking,
0:36:06
Nostra does what Slack does. People will argue that there’s more to it than that. That’s fine.
0:36:12
$26 billion market cap it was acquired by, right?
0:36:14
It was acquired for.
0:36:15
These companies, how on earth are they going to,
0:36:18
without any technology mode, defend themselves?
0:36:21
You might say some sort of network effects.
0:36:24
NOSTA can defeat network effects.
0:36:26
NOSTA has its own network effects.
0:36:29
You know, I see that that value is going to get distributed
0:36:32
from these selection of just a few sanctioned,
0:36:36
beautiful US-listed companies,
0:36:39
distributed through thousands and millions of small businesses
0:36:43
and entrepreneurs to the people.
0:36:45
Because, again, starting a company like Jay
0:36:49
and raising the money that we raised with a view we had
0:36:51
to present that big outcome.
0:36:53
But to start again and not raise any money and to bootstrap it,
0:36:58
I mean, I don’t need to have a company that’s that big.
0:37:02
I can be small and nimble and fast forever.
0:37:06
Do you know what I mean?
0:37:07
Yeah.
0:37:07
Yeah, it’s an absolutely brilliant conversation, Rod.
0:37:11
Thank you for sharing all of this.
0:37:13
I have so many questions in different ways I want to take it,
0:37:16
but let’s do this.
0:37:17
So you’re building Shoshow,
0:37:19
and I want to make a shout out to Anders L,
0:37:23
who came up with a question just on NOSTA.
0:37:25
So when can we get multi-user stream?
0:37:28
Me and some friends want to do some live streams,
0:37:30
podcasts on NOSTA hashtag NOSTA only Yeah I love the enthusiasm eh There so many businesses to build here Oh my Yeah You know and Shosho is going to be quite focused
0:37:43
from here on out on the e-commerce part of that play
0:37:45
because that was, again, I’m trying to make that business.
0:37:48
But how easy is it to fork something like Zapstream
0:37:54
and add whatever features you want to it using a model
0:37:59
and publish it under your own brand name
0:38:01
to achieve whatever thing that you want.
0:38:04
And if you’re not going to do it,
0:38:05
then to put the idea out and somebody else to do it.
0:38:08
You know, that sort of creation becomes just so,
0:38:11
shall we say, just accessible, right?
0:38:15
And so whether or not ShowShow ever gets to doing
0:38:18
kind of multi-party live streaming,
0:38:19
I don’t know, I can’t say,
0:38:21
but I look at just how easy it is for anybody else to do that
0:38:25
and I say, it’s going to happen.
0:38:26
It’s a certainty.
0:38:27
there’s a little thing in Nostra
0:38:30
I don’t know if you’ve noticed it where people these days
0:38:32
are forking Jumble
0:38:33
I haven’t seen that
0:38:35
so do you know Jumble?
0:38:37
no
0:38:37
so Jumble is a Nostra client
0:38:39
it’s a web client written by a guy named Cody
0:38:42
it’s a beautiful web client
0:38:44
you should totally try it
0:38:45
it specializes in the Twitter feed type thing
0:38:48
it is very focused on
0:38:50
and it’s a Jack Dorsey quote
0:38:52
it says
0:38:52
make every detail perfect
0:38:55
limit the number of details and then make every one of those details perfect.
0:38:59
That’s what Jumble has done for kind one notes.
0:39:03
But it’s open source and Cody says, here’s my code base.
0:39:07
Go for it. And people have.
0:39:10
You fork Jumble, you tell your LLM to add a feature to Jumble,
0:39:13
and then you publish it under your own domain.
0:39:15
And so now you don’t just have one Jumble,
0:39:17
which has like, I guess, the reference implementation
0:39:20
of how this author thinks a kind one note client should be written.
0:39:23
you’re starting to have a swarm of jumble clones where even if it just has an audience of one me
0:39:31
i’m building this just for myself because i want a fancy zap button that works like x when i press
0:39:36
it people are now forking that adding that feature just for themselves and publishing it
0:39:41
wow so again there’ll be there’ll be a landscape where you can grab your you know favorite live
0:39:48
streaming client and fork it and add the thing that you want and publish it under your own name
0:39:53
or grab something that already does three-party live streaming
0:39:59
and just stick it on Oster and publish those notes.
0:40:02
Wow.
0:40:02
It’s such a big shift, isn’t it?
0:40:04
Okay.
0:40:05
And where I wanted to then go with this is a fascinating conversation
0:40:08
I had earlier this year.
0:40:10
I don’t want to mention who it was with because I’ll box them if I do,
0:40:13
but I was looking very closely at investing in Satlantis
0:40:17
and I was super impressed by some of the progress Alex made
0:40:23
and I previously interviewed him a couple of years back.
0:40:26
I really love how in just two to three years,
0:40:30
how much people who’ve been building with Bitcoin behind them
0:40:33
have improved basically in their grasp of what’s going on around them
0:40:38
and what they want to build.
0:40:40
And I decided not to invest.
0:40:42
And the reason was largely based on a conversation I had with a friend
0:40:45
around return of capital rather than return on capital.
0:40:50
And it was just like, Jake, what are the chances of you getting your money back?
0:40:53
I said, you know, I actually don’t know. And it was a he described it as a lottery ticket for wealthy people.
0:41:01
And it’s a great description in some ways. And the the conclusion I came to, though, was like, OK, this is a hit and hope.
0:41:09
And you just don’t quite know what’s going to happen. But what’s interesting is, like, first of all, the venture side of things is shifting so much.
0:41:17
It’s like, how do you as a venture investor start to justify putting money into software companies that can be replicated at the click of a button?
0:41:24
Like the defensibility of the position you built for J-Ride.
0:41:28
And equally, this is what Jeff Booth talked about in his Price of Tomorrow experience as a technology founder.
0:41:34
It’s like we spent millions of dollars building this thing.
0:41:37
And the trend was quite clearly that the cost of that production was going to zero.
0:41:41
So how do you defend that?
0:41:43
It’s very hard.
0:41:43
where the conversation went was really around the the moat becoming physical attributes and so i’d
0:41:53
love to know what your view is on this rod as someone who’s building a business as a non-technical
0:41:58
founder using these off-the-shelf tools absolutely the efficiency that you described is filtering
0:42:05
through to the user and the customer which is great but how do you defend that position and
0:42:11
And it got quite niche, to be honest.
0:42:18
I’ll dig it up in a second.
0:42:19
But let me leave that with the questions.
0:42:20
How do you start to defend yourself as a software business
0:42:23
when you can create it as quickly as you described?
0:42:27
Well, the first part that I’d cover is I think the answer to that question
0:42:31
that you’ve got about lottery ticket for rich people
0:42:33
is the portfolio approach that you issued earlier.
0:42:38
And certainly, angel investors, they don’t just back one company.
0:42:41
if you’re going to do this well,
0:42:43
you’re trying to get a beta
0:42:44
on the average return of all your companies.
0:42:48
You’re trying to hope that you back enough companies
0:42:51
that you get the one that’s going to go 100x
0:42:53
and return the whole fund.
0:42:54
But in order to do that,
0:42:55
you have to back a whole bunch.
0:42:56
You have to pay a bunch of bets.
0:42:58
You’ve got a quarter million to invest,
0:43:00
make 10,000, 25,000 clips and spray and pray, right?
0:43:04
This is not an uncommon approach to doing venture.
0:43:06
And I think that’s where a lot of venture funds
0:43:09
have added value, shall we say, in the past, right?
0:43:14
Because they are the ones who actively go out
0:43:16
and solicit the deal flow.
0:43:17
And then you as an LP or whomever,
0:43:20
you don’t have time for that.
0:43:21
And you’re banking on their ability to go and find the gems
0:43:27
and back enough of them that one of them will hit
0:43:31
and return the whole thing.
0:43:33
And I look at that and I say,
0:43:35
well, that’s fantastic for investors,
0:43:37
but what does it mean for founders?
0:43:38
because now we’ve got a Jeff Bezos quote, right?
0:43:43
Here’s a Jeff Bezos quote.
0:43:45
Nine out of 10 businesses fail.
0:43:48
I think we know that.
0:43:50
But one out of 10 businesses will return 100x.
0:43:53
And so if you can play that bet,
0:43:57
you’d play it every day of the week, right?
0:43:59
Because 9-10 in the trash,
0:44:02
but one becomes 100, go again.
0:44:04
Or you can see how if you’re playing the odds that way,
0:44:06
it compounds and your typical early stage venture investor has been doing that forever,
0:44:13
but it’s never been possible for a founder to do so because nobody has time in their life to go 10
0:44:19
times. I mean, I’ve just come out of a business that took me 10 years. And again, what’s changed
0:44:26
in the realm of AI, start a business, launch it, took six months. I could do that 10 times.
0:44:32
right if that was if i didn’t get sufficient traction to be excited to continue with show
0:44:38
show which i mean i’m getting some interesting traction it looks exciting let’s continue
0:44:41
i mean park it do another park it do another and every time you do one your ai practice gets faster
0:44:48
every time you do one you know you probably build a useful reusable code base especially if you’re
0:44:53
building on something that’s open source like a like an austin right so suddenly you as you know
0:44:59
following that, you know, nine out of 10 fail, you get to go 10 times. And so this opportunity to
0:45:05
make sure that you eventually get a hit, which was always reserved in the past for the investor class
0:45:11
is now starting to accrue to the founder class. Really cool. And so how do you then to loop back
0:45:16
to your question, how do you defend that? Well, you just get ready to go 10 times. I think at a,
0:45:21
at a, I guess at a high, at the highest level, let’s assume that we, we’re right. And, you know,
0:45:27
all value is about to accrue to users who can spin up exact copies of your you know company and run
0:45:35
it for themselves for you know pennies with their own llm and even the llm doesn’t make margin on
0:45:41
that and all margin accrues to the user and let’s imagine that beautiful future and that we’re
0:45:47
heading there that’s great but i still think that we’ve maybe got a window right now of let’s call
0:45:52
it five to ten years where we’re actually just going to go and steal silicon valley’s cheese
0:45:56
well and also it’s like you know how many people have even got an ai app on their phone
0:46:03
look at global internet adoptions some people don’t even some people aren’t even online in some
0:46:08
countries you know just it’s it’s extraordinary in terms of the the macro setup to to think about
0:46:14
okay if you’re if you’re basically faster to market with ai than other people there’s an
0:46:19
opportunity there’s no doubt about that um and what a cool insight so yes so as a founder the
0:46:25
you just get ready to hit it 10 times.
0:46:27
So I was thinking it’s like the execution risk is lower
0:46:32
because if it fails, it doesn’t matter.
0:46:34
It hasn’t taken as long.
0:46:35
You just try another one.
0:46:39
Would that make sense?
0:46:43
Yeah, interesting.
0:46:44
Okay.
0:46:45
And so where we went with the, again,
0:46:48
to reference this conversation I had was like,
0:46:50
okay, but what if defensibility is not just an iteration speed
0:46:54
like you describe, or the opportunity to be like a first mover with AI. But what if the opportunity
0:47:00
to defend was actually around real world physical assets and competencies and looking at, okay,
0:47:07
well, it’s actually quite difficult to fulfill the creation of a house, for example. What about
0:47:13
applying AI to house building or a boring business like laundry? Like people still need to get their
0:47:19
laundry done. Okay. What if you’re faster into that business? And I found that quite compelling
0:47:24
as a investor, at least, because it’s like these are services that people are going to need ongoing.
0:47:29
And you’ve also got this class of boomers that are retiring and selling businesses. And maybe
0:47:34
you could take one of those on. Now, I didn’t do any of those things very much just like
0:47:38
spitballing ideas around. But to put a cherry on this idea of defensibility then, Rod, so in your
0:47:45
opinion, it’s about speed as a founder. As a founder, your defensibility will be, I think,
0:47:50
and the practice that you build around getting up and going
0:47:53
and getting up and going.
0:47:55
I think your speed to market is part of it,
0:47:59
but also just your reusable methods and processes.
0:48:04
The thing right now, the thing that separates AI-based users
0:48:10
who are using, I don’t know, Base44
0:48:12
or some sort of rapid prototyping tool
0:48:16
that have no experience and skills,
0:48:20
but they’re getting something out the door right now.
0:48:22
The thing that separates them from those who are going to actually win
0:48:24
is not the model because everyone’s got the same model.
0:48:28
It’s the process.
0:48:31
It’s how do you build your dev practice
0:48:35
so that you have the process that runs faster and more repeatably
0:48:39
and more confidently than anyone else.
0:48:43
This is not a new idea.
0:48:45
Rocket Internet, this was their idea.
0:48:46
Take no business model risk.
0:48:48
copy an existing business model
0:48:50
choose a market where it doesn’t exist
0:48:52
hire
0:48:54
have a process for all of these things
0:48:56
hire an
0:48:58
absolute go-getter in that market and say
0:49:00
here’s your funding and here’s your business model and I want you
0:49:02
to do exactly this
0:49:04
and then repeat that
0:49:06
as often as you can with as many
0:49:08
verticals as you can and as many countries as you can
0:49:10
using
0:49:12
their little
0:49:15
repertoire of
0:49:16
which businesses are worth copying,
0:49:18
which markets are worth entering,
0:49:20
and how do you hire the right founder
0:49:22
for each of those businesses?
0:49:23
And that’s their little repeatable process.
0:49:24
And they just ran it.
0:49:25
And this is how Rocket Internet created,
0:49:28
I can’t even name how many beautiful companies.
0:49:31
And I see that happening again here, right?
0:49:34
Because if you build your AI dev process, right,
0:49:37
and you work out the little things
0:49:39
that make you and your team go at impeccable speed
0:49:43
with repeatable confidence,
0:49:45
and it doesn’t matter how many businesses models you want to attack before you find a hit
0:49:49
because you know for sure you will find one it’s kind of how i’m starting to think about it and
0:49:54
again i’m quite impressed by the traction of show show but the very moment that i find something
0:49:58
more exciting i know that i’ll be able to go get it is a is a wild landscape for a founder to be in
0:50:03
it’s not the landscape i was in with j ride where i was you know beholden to investors and i’d raise
0:50:08
money that i had to keep going it’s a very different landscape and i just think that’s
0:50:12
the time scape that exists for founders now.
0:50:19
It strikes me then that essentially
0:50:22
the quest for product market fit
0:50:25
can now be funded by your time
0:50:29
and elongates the process
0:50:33
such that the chance of success is better.
0:50:36
And you can also hustle different ideas
0:50:39
at the same time
0:50:40
because the engine room of developing those ideas
0:50:44
is a piece of software that you’ve got and a process.
0:50:49
I mean, it’s absolutely insane for any entrepreneur, basically.
0:50:53
Like, what a time to be building stuff.
0:50:56
Like, holy shit.
0:50:57
Yeah, what a time.
0:50:58
What a time to be on the outside and only on the outside.
0:51:01
I mean, BigCo can’t do what I’m describing, right?
0:51:04
Have you ever seen a BigCo trying to spin up an innovation lab and succeed?
0:51:08
No, never.
0:51:09
It’s the rarest thing in the world.
0:51:10
So put your hat on for a minute and go back to BigCo and think about how they’re responding to this.
0:51:15
Your board of directors just asked you whether or not you’re leveraging AI to reduce cost base and improve efficiency.
0:51:23
And so you go to your head of customer service and you say, hey, you repeat the question, are you doing X, Y, Z?
0:51:29
Give me a plan on my desk tomorrow that tells me the opportunity that you haven’t captured yet and how you’re going to go and get it.
0:51:36
what’s your head of customer service going to do is they look around and they see their budget and
0:51:40
they think oh that’s going to get cut and then they see their headcount and they say oh I love
0:51:43
these people and I spent so long recruiting them and then they say oh you know but I’ve got an
0:51:47
existing customer base and what if I upset them with bad AI replies and we’ve got this existing
0:51:52
brand reputation and what happens if we damage it and we can’t stand those risks that would be
0:51:56
horrible we’re not going to we’re not going to be able to say with a straight face that AI is any
0:52:01
good and besides that if I did say with a straight face that AI was good I’m going to lose budget
0:52:04
next quarter. I’ll just say that, you know, we explored it and it’s not good. So then you go
0:52:11
back to your board of directors and you say, oh, you know, it’s the opinion of our senior leadership
0:52:14
team that there’s nothing to do here and we should just keep on with our business. Compare and
0:52:18
contrast to you, Jake, the outsider who looks at an incumbent company and says, I wonder if I can
0:52:22
copy that with no one at all. I wonder if I can go after that and instead of having 600 headcount,
0:52:28
have two. You might be wrong. It might not be possible, but if you fail, you’ve lost nothing.
0:52:34
And if you succeed, you win the whole game because they can’t come after you.
0:52:39
And you can only do that if you’re on the outside.
0:52:43
So I just want a time to be a founder.
0:52:46
I really think so.
0:52:47
Rod, do you think then, I’ve heard some others talk about this,
0:52:51
but conceptually, do you think a single man billion dollar business is possible?
0:52:59
I mean, sure.
0:53:00
Yeah.
0:53:00
I mean, I wonder if eventually you’ll get companies that are running so much on autopilot that maybe the founder passes away and no one notices.
0:53:10
And the AIs just keep collecting Bitcoin every day.
0:53:13
And eventually it’s, you know, one of the largest holders and there’s no one running it at all.
0:53:17
But also no one knows how to turn it off or even where the software runs.
0:53:21
All sorts of things are going to happen.
0:53:24
Wow.
0:53:24
It’s extraordinary, isn’t it?
0:53:26
Oh, my gosh.
0:53:26
um rod what i want to do is i want to circle back to something you touched on very near the start of
0:53:31
the conversation um and that was around policy and this experience you had building a business
0:53:39
in travel and first of all like what it was like to be close to the money printer in a sense and
0:53:46
also then the idea that like oh look here’s this pandemic that’s come along and your market’s now
0:53:50
just closed um at least those are the two things that i think that you were referencing when you
0:53:56
talked about policy so what does that mean to you and and what were some of your lessons from that
0:54:00
yeah so just to unpack a little bit about what happened there so
0:54:07
running a travel technology business into the onset of the pandemic
0:54:11
and most investors start calling around january of 2020 saying what’s going on something is
0:54:21
something happening do you see anything in your numbers and at that time we didn’t right we had
0:54:25
one investor call and say, prepare.
0:54:28
Okay, well, we’ll take that in mind and we’re watching it carefully.
0:54:34
Then March 20, 2020, US closes its borders
0:54:42
and the whole world rapidly follows suits.
0:54:44
And immediately, you know, your travel technology company
0:54:49
that hasn’t had a single down quarter in, what was it at that point?
0:54:54
10 years or nine years suddenly loses 95% of its revenue immediately and has to refund
0:55:01
in million dollars worth of travel repairs that aren’t going to go ahead and also still
0:55:05
work out how to pay transport companies for all the jobs that they did do.
0:55:10
What a crazy trip.
0:55:11
Oh, and also explain that to the team and explain that to the capital markets while,
0:55:16
you know, planning the, I guess, you know, unwinding of 75% of your headcount.
0:55:21
you know what a thing and you know you can look at that and you can say it was a virus but I’m not
0:55:28
responding when I’m responding to that I’m not responding to a virus I’m responding to a policy
0:55:32
decision I’m responding to the US and then subsequently Australia’s decision to close
0:55:36
borders and say that travel is no longer a vertical we want to support yeah and so you know what do
0:55:43
you do well I mean you get through it right so you you manage the team through it you tell them all
0:55:48
to work from home, you have emergency board meetings, you reduce costs, you get through
0:55:54
on the smell of an oily rag.
0:55:55
And if you do it well, you take care of your people.
0:55:58
And then at that future point in late 2021, when we were able to be an exciting barbell
0:56:04
story and raise a bunch of money, you’re able to bring those people who are still on the
0:56:08
outside back from whatever job they managed to land that they didn’t prefer because you
0:56:13
took care of them.
0:56:14
Now you’re hiring again.
0:56:15
They’ll come back to you.
0:56:16
And we did all of that.
0:56:17
We did it very well.
0:56:18
And still it makes you look at the situation and say you say and again as a founder you into only one business right
0:56:30
Bold a lightning out of a blue sky.
0:56:32
Suddenly everything shuts down for that one business.
0:56:36
What if I had two businesses and one of them was Zoom, right?
0:56:41
And, oh, look, travel’s done, but, wow, look at teleconferencing.
0:56:44
and you just not just pull your own focus,
0:56:48
but pull your capital and pull your team
0:56:50
and go and scale your other business up.
0:56:53
So, you know, this is a thing that investors were doing
0:56:56
when they were diversifying against multiple verticals
0:56:58
that founders couldn’t and now maybe can.
0:57:02
And so, you know, again, sitting through that experience
0:57:06
with Jayride and, you know, seeing the impact
0:57:10
of these massive external macro forces
0:57:15
and how they will absolutely crush you without any thought.
0:57:20
And kind of maybe, you know, I guess if you’re a Bitcoiner
0:57:23
and you have a view to monetary policy being insane
0:57:26
and you maybe perceive that, you know,
0:57:30
the state response to that fallacy of monetary policy
0:57:36
will be continued insanity, possibly with greater severity,
0:57:40
possibly with greater frequency in future years from whatever form it might take you say well
0:57:44
diversification let’s let’s run multiple parallel entrepreneurial tracks if we can or at least
0:57:52
build a core competency of skills and discipline around starting things so that if let’s call it
0:57:59
maybe not inevitable but if catastrophic macro forces affect you again you can say i’m going
0:58:05
from here to here or you can say okay take this competency of starting something and start something
0:58:09
that’s appropriate for the time and space.
0:58:11
Put the other thing just on ice for a minute
0:58:12
and come back to it when it’s ready.
0:58:14
You know, that’s the sort of thing you didn’t have
0:58:15
the flexibility to do as a list co.
0:58:18
You know, it was my job to help investors through it,
0:58:21
to make sure the company remained funded,
0:58:23
to take care of all suppliers and team members
0:58:25
and so on and so forth.
0:58:26
And so, you know, you step into the role and you do your job.
0:58:31
But given the choice, better to be on the outside.
0:58:37
Yeah, it’s very interesting, isn’t it?
0:58:38
And so the bolt from the blue, what do you think,
0:58:44
and you touched on this just now,
0:58:45
it’s essentially you want diversification as a founder,
0:58:49
which is now in theory possible to do,
0:58:52
given the engine room of the business can be automated, essentially.
0:58:58
What were some of the decisions you’ve made over the last six to 12 months
0:59:04
of building that have been heavily influenced by that experience? I lost your question, Jack. Sorry,
0:59:11
can you feed it to me again? Over the last six to 12 months of building, which decisions have you
0:59:18
made that have been a result of the insight around the fact that you can have diversification as a
0:59:24
founder? I mean, getting into NOSTA. Yeah. 100%. I mean, I think you asked about, you know,
0:59:32
at the very start and you wanted to focus, I think,
0:59:35
a little bit on why the choice.
0:59:36
Yeah, let’s get there.
0:59:38
60 minutes, that’s it.
0:59:39
Great.
0:59:39
It’s okay.
0:59:40
It’s okay because I already gave you the layup that at least part
0:59:43
of this is about feeding the AI and just the sheer mass of beautiful
0:59:47
open source code that’s been funded and made available for people
0:59:50
to build on the network and just how fast that makes you speed
0:59:54
to market with AI because you can feed it existing great architecture
0:59:59
and, say, emulate, and it will.
1:00:02
But also diversification, right?
1:00:04
So I have a particular lens to this, which I like to roll out.
1:00:09
Do you remember a thing called Google Wave?
1:00:12
No.
1:00:13
A little while ago.
1:00:16
And you know Google Maps.
1:00:18
Yeah.
1:00:19
So Lars, who founded Google Maps, it wasn’t called Google Maps.
1:00:24
It got acquired by Google, Lars with it.
1:00:26
Lars was given a remit at Google to make something revolutionary, right?
1:00:30
It was going to be a brand new communication platform that replaced email forums.
1:00:35
It had, you know, multi-party editing in real time, which, you know, later then moved into Google Docs.
1:00:42
It had all of these fundamental innovations.
1:00:43
He ran that for three years.
1:00:45
He made a big deal out of this in the developer and founder community because the vision was, let’s create a platform where everybody can get onto it.
1:00:55
Everyone can build their own applications.
1:00:56
This is going to provide like a fundamental layer that is otherwise missing.
1:01:01
And it’s going to be, it’s going to be Google,
1:01:04
but it’s going to be open so that other people can build on it.
1:01:06
Let’s get out there.
1:01:07
Let’s get the developers in there and building on this thing.
1:01:09
And he had three years and then, you know,
1:01:11
the CEO of Google just said, no, too complicated.
1:01:15
Pull the plug.
1:01:17
I happened to meet him in a bar at the,
1:01:20
because he was Sydney based,
1:01:21
happened to meet him in a bar shortly after that happened.
1:01:22
And I was such a dickhead.
1:01:23
I asked the question, what happened?
1:01:25
And he had certain commitments that he was going to be able to take a long path to make a proper infrastructure play for the development community that he believes weren’t fulfilled.
1:01:34
And he went off to Facebook and I presume he was very happy there.
1:01:39
But the lesson is, you know, he is one of the biggest and most exciting technology firms in the world, making a promise to the development community.
1:01:50
here’s a platform that you can use to build your business on and then three years later they pull
1:01:57
the plug and pull the rug out from every one of those developers and everyone who built on google
1:02:01
wave then is left going well look at all the time in the capital we wasted right what a what a complete
1:02:08
waste of time i wish i had done anything else right i just had the rug pulled entirely it’s
1:02:13
the de-platforming thing that you talked about but writ large across you know what was supposed to be
1:02:19
this innovative new thing.
1:02:23
Lesson learned, you know,
1:02:24
don’t invest on building on somebody else’s land.
1:02:29
You know, do build only on something that you can own.
1:02:34
And so along comes Noster with a statement that, you know,
1:02:36
you can own this.
1:02:38
There’s no central anything.
1:02:42
There’s no one who controls it enough to pull the rug.
1:02:45
You can continue to write JSON in this format forever
1:02:48
and absolutely nobody could stop you even if they wanted to.
1:02:53
That’s a better foundation to be building on, right?
1:02:55
It’s platform, de-platform-less risk, none of that risk.
1:03:01
Bad English, but you take my point.
1:03:04
Think about like how the internet started, right?
1:03:06
So, you know, here’s an open protocol.
1:03:09
It’s protocols that make the internet great.
1:03:11
Here’s an open protocol for communication of information, HTTP.
1:03:16
It’s brand new.
1:03:17
we’re going to have publishers who own websites who publish data and then we’re going to have users
1:03:22
who visit websites to consume data but that’s not actually you go forward these days that’s not
1:03:28
actually how we use the internet right every single user of the internet is both a creator
1:03:32
and a consumer how many of us own websites and servers few if any right but that’s not even the
1:03:40
main way that we want to do it we want to be as an individual networking with our social network
1:03:45
consuming their content, creating content and reply to them, right?
1:03:49
Like it’s an entirely different use from the original kind of web one.
1:03:55
Now the market, as it does, sorted that out by saying, well, you know,
1:03:58
I’m Mark Zuckerberg and I say that wouldn’t it be great if users could exist
1:04:03
within a social graph and create and consume content from each other.
1:04:07
And venture investors said, you’re right, that is missing from the protocol.
1:04:10
Let’s create a company out of that and we’ll put a lovely moat around it
1:04:13
and we’ll try to protect it and we’ll build shareholder value.
1:04:15
hang on that’s not why the internet was created right the the building of moats around data
1:04:23
interoperability to build shareholder value was not why the internet was created right the internet
1:04:28
was created for interoperability right for permissionlessness but it was missing that
1:04:35
social layer you know facebook created it and put a wall around it google tried and they cried many
1:04:42
times and one of them was called wave and they rugged everyone you know what i see with nostr
1:04:47
is i see well here’s the missing piece of the protocol right here’s a here’s a thin very simple
1:04:53
identity layer interoperability protocol very basic content distribution that anyone can copy
1:05:02
anyone can emulate anyone can build on that can’t be taken away you don’t need to ask anyone’s
1:05:08
permission to use it that’s the internet and so again thinking about like as a as a founder am i
1:05:14
going to go and apply for permission from large silicon valley juggernaut or am i just going to
1:05:18
build on something that’s open rails 100 open rails and this this then again come come to being
1:05:25
a founder you know can i still remove more risk what risks am i removing by by going here one i’m
1:05:33
removing deplatforming risk. You mentioned that. And not just because I’ve said something mean and
1:05:39
now the company doesn’t want my custom anymore, but also as in the Google Wave example,
1:05:45
companies shut platforms down all the time. So I’m removing those risks. I’m also increasing
1:05:51
all sorts of opportunity because anyone can be building on the same rails and I can interoperate
1:05:57
with those contents. Think about the speed to market. Think about all the things you just don’t
1:06:02
have to build right so we’ve launched show show it provides live streaming i didn’t have to build
1:06:09
a sign up page i just said plug in your nostril id i didn’t have to build an edit profile page
1:06:14
i didn’t have to decide on any architecture because i just copied a standard i didn’t even
1:06:19
have a server i just yeah do you want to invite your friends no yeah exactly and then the big one
1:06:24
here’s a here’s a you know peer-to-peer sort of experience where i don’t have to solve a chicken
1:06:30
in their problem. I don’t have to worry where my first users and content are going to come from
1:06:34
because I just bring it in from the network. It’s already there. And so you get this massive
1:06:40
advantage with less risk and faster time to market. I mean, everyone should build a monster.
1:06:45
I don’t see there’s any better way. Yeah, I like to think of it as a superior form of capital
1:06:52
allocation. And it’s largely because it’s the property rights. It’s built different. And protocol
1:07:00
is superior to platform and saying you know like a rumble we won’t switch you off okay until you do
1:07:07
or elon like i’ve just bought the whole of twitter because i can and now i’m going to run it as a
1:07:12
business and it has to make money and if it doesn’t then i’m fucked oh well guess what i’m
1:07:17
going to call it the free speech platform but actually there’s a whole lot of stuff we’re doing
1:07:20
on the back end that means that it’s it’s not and it that’s a choice and that’s absolutely their
1:07:26
choice because they’re private businesses you can do whatever you like but until you understand that
1:07:31
and i think it’s that whole thing like basically the internet’s become i’m going to hop on instagram
1:07:36
for a bit and now i’m going to go to youtube or maybe i’m going to hang out on tiktok for a little
1:07:40
bit or tiktok shop and now i’m at amazon and now i’m done it’s like that’s like a bunch of private
1:07:46
companies with digital monopolies that either monetize your attention or are a classic kind
1:07:52
of e-commerce play and a winning because of the the tendencies of a monopoly and
1:07:58
it’s funny really like the the deeper you get into this concept of the free market it’s like
1:08:04
that’s that’s okay it’s the do whatever you like but as individual entrepreneurs or creators
1:08:11
this is the playing field and if you just so happen to see that the playing field is over
1:08:16
here as well aka Noster and you can have a key pair that you know I even got excited recently
1:08:22
thinking about inheritance and and I’d read a great book that was called Call Me Ted which is
1:08:29
about a guy called Ted Turner who started CNN and he inherited a business from him for his father in
1:08:36
the US that was a an advertising company with billboards and it was like the 50s and people
1:08:42
were driving cars and suddenly the billboard business was growing and that turned into what
1:08:48
became CNN and it’s an amazing story just because you’re like the playing field was different
1:08:52
billboards and cars were a big deal but now it’s like we’re in cyberspace and currently your
1:09:00
your billboard is on Facebook’s digital real estate or on Google’s digital real estate and so if they
1:09:07
want to just burn your your billboard down they could but NOSTA changes that you’re like wow what
1:09:12
would it be like to inherit a Nostra key pair in 30 years time that’s been building or accruing
1:09:20
capital all that period? I don’t know what that looks like, but it’s like, wow, the playing field
1:09:25
has just changed. Yeah, look, I agree. It’s a different playing field. It’s a great time to be
1:09:32
a founder. Your ability to get out the door and build a thing with AI, your ability to build on
1:09:40
an open platform where no one can ever
1:09:42
rug you.
1:09:43
Your ability to diversify,
1:09:46
avoid risks, and
1:09:48
I guess even more than anything else,
1:09:50
go and target overblown
1:09:52
fat, two
1:09:54
high market cap Silicon Valley companies that
1:09:56
no longer have technology moats and possibly
1:09:58
no longer even have network effect moats
1:10:00
should NOSTA succeed,
1:10:02
and just go and take their business.
1:10:05
And
1:10:06
ultimately then over the course of five to ten
1:10:08
years, there are enough entrepreneurs doing that
1:10:10
create a world of empowered users,
1:10:14
Bitcoiners would say sovereign individuals.
1:10:17
What a time.
1:10:19
It’s a great place.
1:10:21
Yeah, and I think it’s this idea, isn’t it,
1:10:22
that you control your own data
1:10:26
and without necessarily realizing it,
1:10:29
when you log into Twitter with your email
1:10:31
and your password or whatever might be the case,
1:10:33
you’re stepping onto someone else’s piece of private property
1:10:37
and that’s okay because they built it and someone owns it um but what that means is
1:10:44
if you’re you know quote unquote free like you’re the product and somehow that’s just people don’t
1:10:51
even realize right oh they’ve got an instagram account like do you understand what you’ve given
1:10:56
away in order to actually have that like what’s the cost and in some ways it takes an innovation
1:11:02
like Nostra to turn up for you to really be able to answer that question more effectively because
1:11:06
it’s shifted.
1:11:09
And so, okay, Rod, we’ve been going for an hour or so.
1:11:12
I’ll look to wrap this up in the next five minutes.
1:11:16
I’m intrigued just to get a bit of a futuristic play.
1:11:20
We’ve talked a lot about what you’re doing right now.
1:11:23
But over the next 12 to 18 months,
1:11:25
what’s got you most excited
1:11:26
and where are you going to spend your time?
1:11:29
I’m excited about NOSTA generally.
1:11:33
And then specifically, I think live streaming
1:11:35
is a very exciting vertical plan.
1:11:40
I’m going to build that live streaming e-commerce play
1:11:44
in Shoshow that I’ve mentioned,
1:11:45
but just live streaming in general.
1:11:47
I think we’ve seen over the last little bit
1:11:49
social media protocols,
1:11:51
and it doesn’t matter,
1:11:52
sorry, protocols or businesses,
1:11:54
it doesn’t matter which they are.
1:11:55
The moment they add live streaming,
1:11:56
it’s a very important and interesting thing
1:11:58
for them to add that’s additive.
1:12:00
We’ve seen, for example,
1:12:01
Rumble added and suddenly get a lot of traction.
1:12:03
We’ve also seen some of the incumbents
1:12:05
like Twitch, lose a bunch of market share to kick, streaming is becoming decentralized.
1:12:11
Streaming always had this really interesting opportunity, right?
1:12:14
It’s all open source code.
1:12:16
It’s all open source Legos, just like Nostra, where anybody can plug and play little bits
1:12:20
together and go live.
1:12:21
But it had a key problem, which was discoverability, right?
1:12:24
It’s not, it doesn’t age well, this content, unless you’re there live at the moment, unless
1:12:28
you can be found at the moment, then your live stream expires and it’s gone.
1:12:32
And, you know, so you need to find a way to get discovered.
1:12:36
Traditionally, a few large platforms, be it Twitch or YouTube or, you know, TikTok became these centralized discoverability portals.
1:12:45
But, you know, NOSDA solves discoverability, right?
1:12:49
If not in full now, as it’s new in time, it has its own network effect.
1:12:54
And then you as a streamer can publish to any server, have that syndicated through any relay to any consumer on any website.
1:13:02
Must be ultimately better discoverability than I can only stream to one server and it can only be on my website surely
1:13:08
And so I see in general streaming is a very interesting
1:13:12
Market that’s already breaking apart and decentralizing and I see Nostra as really interesting rails for that to ride on
1:13:18
I must give props to Kieran right for showing the way with zapstream
1:13:23
But then as kind of more people enter this you’re going to see different servers. You’re going to see different, you know
1:13:28
broadcasters you’re going to see all sorts of different things come through different business
1:13:32
models like i’m talking about with show show and and others like maybe tk building with his uh you
1:13:38
know apple tv for nostra streaming app is any number of things that can happen here so i’m
1:13:44
really watching that closely i’m pretty excited to see where it goes awesome and i’m very excited
1:13:49
to see what you create rod it’s um it’s a conversation like this is such a great kind
1:13:55
snapshot for a moment in time and in a year or two years you can go back and you listen oh that’s
1:14:00
what we’re talking about then and this this has then happened or whatever and what’s so cool is
1:14:04
is someone with your your skill set essentially refocusing their attention in this direction
1:14:11
going okay well look i built a company before i know what i’m doing in this sense you’ve just
1:14:15
talked through the the rocket internet playbook but we can do that as individuals you don’t need
1:14:20
to be rocket internet to do that any longer um oh very very exciting well rod thank you so much
1:14:26
and the final comment would be it would be interesting to live stream some of these
1:14:30
conversations and so i haven’t done this before with nostr uh because i just i haven’t figured it
1:14:36
out yet but you could live stream conversations that then obviously become recorded podcasts and
1:14:41
it’s very popular thing to do um maybe that’s i’ll have a play around looking at some of the
1:14:46
different tools to do that and see where that takes for the next couple weeks but rod thank
1:14:49
you so much for your time today um last question if people want to reach out what’s the best way to
1:14:54
do that uh find me on nostra um jake can you share my handle absolutely i’ll put it in the show notes
1:15:01
well rod thanks so much for your time today thanks jake it’s been a pleasure thank you