Why Secondary Markets Are Eating the IPO | All-In Liquidity Secondary Markets Panel

00:00:00Everybody wants access to these privatemarkets. Joining [music]>> us right now to discuss all of this isKelly Rodriguez. He's a Forge CEO. Wesee a world where the [music] privatemarket opens up and is accessible to anyUS and global investor. There's 19companies in the private market AIbasket. These companies have grown onaverage 300%.>> Please join us in welcoming Gavin Baker,managing partner and CIO of Atrades. TheROI on AI hasempirically, factually, unambiguouslybeen positive. Investing is the searchfor truth. We welcome in Brad Gersonner.It's good to be back with you. You havea program called Invest America.>> I think we have a historic moment rightnow to get [music] everybody into thegame of capitalism.

00:00:46>> Do we have a few slides from Brad tokick this off?>> You know, let's startic like old times.like old times. This uh this panel I Iactually was backstage. I said, "Gavin,do you know we're talking aboutsecondaries?" He's like, "What do youmean?" And I said, "Okay, so here, let'sjust set this up for everybody. Theroom's full of people who areallocators. People are looking fordistributions. So this is um secondarymarkets over the course of the lastdecade. This is the amount of moneygoing into VC each year, the amount ofmoney coming out of VC each year. Thered line represents the net effect ofthat. So Jamath, we're in like 5 years,right, where a lot more is going inthan's coming out. But the secondarymarket is at record volume. So this is,you know, I call these companies quasipublic companies. These are these laterstage companies. There's buying andselling that's going on every day. Lookat that, Jason. Relative to the 21 peak.We thought that was crazy at the end of21. We're double that now in terms ofsecondary transactions. This is theamount of employee secondary. So this ispeople buying into Anderal, Anthropic,SpaceX now represents 31% of all primaryventure activity is buying into thesesecondaries in 2025.

00:02:02Secondaries are now competing with IPOsand acquisitions as the principal waythat these guys are exiting. So, Ithought that was a decent setup to startthe conversation this morning just tolevel set how important secondaries[clears throat] have become. And thenthe final one is secondaries over thelast couple years were trading at adiscount to market. So, if we wanted tosell shares in one of our companies,right, to buyers out there, they werewilling to give us 80 cents on thedollar in order for us to get liquid sothat we could send DPI back to our LPS.Today it's at 106. Uh uh so a premium inthe market as a coupon.>> And this doesn't include some of thewild west of SPVS that have beenunraveled recently.>> People charging 10% loadin fees, doublecarry and a lot of gray market offmarketstuff. This is also having a profoundimpact, Gavin, on employees at thesecompanies that I want to hear aboutbecause you've seen it up close andpersonal with SpaceX and they have avery orderly process here. So, why don'twe start there? What impact is thishaving on the employees, Gavin? And thenon the market, how orderly is

00:03:17this? Andand who are the buyers? Are the buyersthe sucker at the table? are thesefamily offices, high netw worthindividuals who keep hearing us talkabout Anthropic or SpaceX or Andril andthey just say I have to own the name andthey're not discerning. So Gavin, maybeyou can start about the impact on theSpaceX employees you saw firsthand, etc.Well, maybe broadening it beyond SpaceX,I do just think if companies are goingto be staying private longer, this isabsolutely necessary. There I thinkthere are a lot of people who are veryum very wealthy on paper but actuallycash poor and if you're makingtremendous sacrificesuh because you know you work for acompany that you really believe in andyou're contributing a lot to thatcompany. It's hard if you can't buy anice house for your family. It's hard ifyou can't afford to do nice things,>> especially in year seven, eight or nineof working at the company and you tellyour spouse we're worth 10 million onpaper, 30 million on paper and you don'town your home.>> Yeah. Or year 15. And so I think this isnecessary and important and you knowwhether it is good or bad, I think it isvery clear that companies um are goingto stay private for longer.>> What's

00:04:32the reason to stay privatelonger? Truly>> I I I don't think there is actually agood reason to stay private longer>> here. Here>> and>> I completely agree with you too.>> Yeah. And I>> Why has it happened? This is foundersdon't want let's just call it what itis. Founders don't want to be under amicroscope. They want to build and enjoylife and have it easier than being onthe public market microscoped.>> Yeah. I think there is a perception thatlife as a private company is easier andyou have more freedom and you can thinklong term.I don't agree with this. I always thinkabout um Mark Zuckerberg's commentarythat had he been public. So just youknow Facebook um I won't call it anear-death experience but long ago it'sdifficult to believe but I don't 10 112um Facebook did not believe in apps theybelieved in something called HTML 6>> and HTML 5>> HTML 5 HTML 5 Yes. You you you you werethe actual>> it was the cataclysmic debate and it wasme and Brett Taylor. Me versus Brett. Iwas like apps I want to go build aphone. Brett was like HTML 5. Zuckpicked Brett. Spent the next three yearsunwinding that decision.>> Absolutely. And Mark Zuckerberg

00:05:47andbasically the idea was you know theiPhone comes out and initially there wasnot a big app app ecosystem and therewas a thought that hey there's no needfor apps. you're just going to use theweb browser on your phone and HTML 5 wasa way of look of making websites lookmobile native>> dynamic.>> Yeah. And this seemed like kind of thefuture to a lot of very smart peopleincluding Google, Facebook. Um but itwas not the future. Um it was wrong. Andwhat Mark Darker has said, I thinkseveral times in public is he profoundlybelieves that had he been a publiccompanyum when you know there was this internaldebate between the and the detail wasactually I went to Zuck and I said Ineed a billion dollars to build thisphone and we are in this moment in 2010where we can have the third leg of thestool. there's Android, there's iPhone,neither have really taken off yet.And and he's like, we don't have abillion. And I said, but the publicmarkets will give us a billion. And hesaid, no, but then we went public a yearlater,>> but that year made all the difference.>> Made all the difference. And he saidthat had I had the constant pressuretesting from public market investors,you there's

00:07:02a dynamic. I was I wastalking to another CEO here thismorning. When you're the CEO of aprivate company, you are the mostspecial flower to all of your investors.[laughter] You're like, you are asimportant to your board members,particularly if you're reallysuccessful. You know, maybe as the boardmembers families or parents, you know,the board members think about you a lot.Um, once you're public, you're one ofthousands of companies. Um, and that'sits own dynamic. But the consequence ofthis is is that private investors areoften selling to management teams. Andat some level that can mean tellingmanagement teams what they need to hearbecause you want to be able to keepparticipating in the rounds. Once acompany's public, you can buy or sell asyou wish. And this means that investorsfeel freer to give companies managementteams. And Zuckerberg Zuckerberg said,"Had I been public, had I been gettingrigorous, detailed questions from reallysmart public equity investors, I think Iwould have, you know, by the way, thesecond unwritten story of that, whichhas never been said, he called me. He'slike, "Hey, man, what the is going onover there?" Uh, and I was like, "Yeah,I know." Cuz I had just left and then wewrote a deckand I walked over to Zuck and I'm like,"Here's the deck

00:08:17of what you need todo." Yeah,>> do these things. Well, this is a keypoint. I think Gavin is when you'reprivate, you do not get cleaninformation as the CEO and themanagement team because people wantaccess and once you give the truth oryou ask the hard questions, you mightlose access>> 100%.>> The sickopantic nature of privatemarkets is real.>> Now, an exceptional CEO>> Elon>> seeks out negative feedback. looking forthat.>> But not many and actively discards, butnot many CEOs maybe are are wired thatway. And by the way, I do think we haveto give Brad credit. That was a verygood deck. You said back in 2012.>> No, cuz he did a second one. He had>> when he did the second one, he did theopen letter to Zuckerberg at the end ofWas that at the end of 22?>> October 22.>> Why don't you call it? Get fit. What wasthe uh time to get fit?>> Time to get fit. That was an impact.Those are two very impactful.>> Okay. So look, there's you're you'rehearing the bulls on going public, butKelly, take the red team the other sidebecause you're on the other side. Youbuilt a private business, you sold it toSchwab, so clearly one of the largestfinancial institutions now is going toram its way into this market. But thenyou're seeing a lot of push back.Anthropic is like, "Hey, uh, dissolvethese SPVS."

00:09:33OpenAI, I think, was sayingtoday now, dissolve these SPVS.Should we dissolve the SPVS? Where arethey coming from? And why are you on theright side of history?>> And and have you had to dissolve any ofthe ones on your marketplace?>> No.>> No. Look, I think that uh first of all,being a private company CEO for most ofmy career and then being a publiccompany CEO for three years, I recognizethe job is incredibly different. It'smuch less fun. Uh you're not doing>> Hold on. What do you mean when you saymuch less fun? Turning into aninvestment manager primarily as a publiccompany CEOis a very different job than being avisionary [clears throat]product first uh first principlesbusiness when you become a publiccompany CEO everything changes and Iwould say in the world we're in now thekind of capital you can raise the kindof capital that was represented in thevery last discussion allows you toextend extend your private life. SpaceXprivate company for 24 years. Um but thereality is these SPVS that are nowemerging

00:10:48because these companies aregetting so big is because a market'strying to happenand a company like SpaceX has done thisextraordinarily well. They've runessentially liquidity programs foralmost a decadebecause there's so much pent-up interestin both being an investor and gettingliquidity for some of the reasons thatGavin was mentioning. So I think what wesee now is the next phase of this thisSchwab deal with Forge basically says tothe world this is a real asset class.It's more than just secondaries.We're going to put these companies, thecompany's equity into fund products intovery well-managed, regulated SPVstructures because they do serve apurpose in the market.>> Yeah. But if you're how do you convinceElon specifically to give you access tothat when he wants to do it himself andhe has a team and every six months heruns it himself? How do you get accessto that? What's your pitch to the nextElon?>> Here's the pitch. The pitch is you'regoing to go from being a private companyeventually to a public company. WhatSchwab represents

00:12:03is 46 millioninvestors and 12 trillion.This will change capital access and theway that you distribute your sharesmoving from private to public.>> How did that work when you pitched themon that?>> Were you Well, I'll tell you. We got ourfirst SPVS on SpaceX in 2018 and 2019.Were they was he okay with it?>> Absolutely. Totally permissioned. Andthen as we got closer to the IPO, wesaid, "Guess what? Um, we've got 30million retail investors that would liketo have a $50,000 slice of SpaceX."And and he went out [snorts] publiclyand talked about having broad-baseddistribution>> at the IPO price.>> At the IPO price and Schwab was namedone of the IPO allocations.>> Beautiful. I do think this is actually avery effective pitch. I think a lot ofthese CEOs, they're a little bitambivalent about, you know, and I thinkthey understand that maybe theinstitutions who are investing in theseprivate rounds, you know, they mayrepresent, you know, unions, they mayrepresent retirement plans, but I dothink they like the idea ofdemocratizing access and if they'rebuilding something that they think isgreat, giving ordinary Americans

00:13:18anopportunity to participate. I actuallythink that's a very appealing story toto a lot of these CEOs>> because they're capitalists and and theyunderstand the power of equity. So Brad,>> what is the downside then of cuz you'repart of the go direct movement now? BG2pod officially fifth bestie. Gavinofficially sixth bestie. You [laughter]got that's Gavin. That's new news. Weofficially made you six bestie today.>> But does that mean I'm definitivelybehind Brad? Cuz [laughter] that that'sthe real news.>> I can You're standing behind Brad.You're just giving him that big bear hugright behind him.>> Wow.>> So, are you saying I'm the big spoon?>> You're the big spoon now [laughter] inthe in the side draw with the extraspoons.>> But Brad, it's getting very weird veryquick.>> In all seriousness, with great powercomes great responsibility.Sometimes the, you know, the enthusiasmpeople can have can exceed reality.>> Correct.>> Going direct, you've become moremeasured. I've noticed as your profilehas gone up.>> I think all of us have to like just makesure people don't blindly follow trades.Don't>> you were talking stuff down on CNBC acouple of times saying, "Hey, I don'tthink

00:14:34the average American needs to bein some of these companies. There'stime.">> I get worried. I get worried at thispoint in the market stage, particularlyon CNBC where you're talking to retailinvestors at home. Yes,>> I was one of those retail guys lookingup to everybody on this stage, trustingeverybody on this stage. And when peopleare telling you to yolo into rightdouble fee structure, SPVS and all this,you know, like it's time to be careful,to do your work, to be thoughtful. We'rein this because we want this to bedurable democratization for a long time.Yeah.>> We want to build trust among those whofeel left out and left behind incapitalism. We all think that we need togo public sooner. The reason I think weit is destabilizingwhen you're creating trillions ofdollars in private value and 80% ofAmerica think it's a scam where they'releft out and left behind. That's>> and then they come rushing in>> and they could benot so good cards,>> right? So, all I'm saying, like I saidabout they asked the question on CNBClast week, if you had $100,000 of freshcapital and you were sitting at home, istoday the day that you would shove itall into the market? And I said, no, Ithink about it in sizes,

00:15:50right? We justhad two of the biggest months in thelast 10 years in the public markets.They've been big months. So, if I had astack of a hundred, I may put 30 to worktoday. I'm never going to pick thebottom. I'm never going to pick the top,but I certainly wouldn't be putting itall to work. And I'd say the same thingabout latestage privates, people who areyoloing into this stuff, and then theyfeel really disappointed. They're like,"Hold on a second. I bought the SpaceXIPO and it didn't go up 3x.">> Let me ask you then.>> Yeah.>> Do you view this as exit liquidity foryou? Like, would you shape yourportfolio and returns and increasinglysay, "You know what? I don't know whenthis guy's going to go public.">> Yes.>> Let me just pump the stuff out. Let meget the distribution. and let me send itto my LPs and just call it a day.>> We we are selling into this.>> You're selling into this,>> right? So, I have LPs in this room whosay, "Listen, we invested in your VC5 orVC6 7 or 8 years ago. If you can go sella slice of that at four or 5x and we getDPI and it's priced really high, then gosell some of it." And we often don'ttalk about this in Venturland. Half ofwhat we do is in the public markets.Gavin and I get up every morning and wethink to ourselves, should we buy todayor should we sell today?

00:17:06Venturecapitalists don't think about the sellpart. They think about the buy part. Soone of if we're going to stay privatefor longer and we're going to havetrillion dollar you know privatecompanies and data bricks at $200billion you got to think about is todaya day we should be selling some andreturning it to our investors because>> doesn't it create though as as whatJason said these very complicatedpersonality dynamics where maybe you getshut out of a new company maybe you getshut out of an incremental round and youknow there's bad blood because you're acredible investor And there's thissignaling risk. Whereas in the privates,if you and Gavin decide to sell, nobodyknows.>> Well, no. In the in in the private,nobody knows.>> Exactly. The public's they don't knowuntil our 13F comes out. Okay.>> But in the private market, it's always aconversation between me and the founderto say, "Listen, we're we're going tosell 30% of our position." They neverlike it, Chimath. They're always like,"We wish you wouldn't do that. Theydon't want it known, etc." But my job asa fiduciary to the LPs of this is to dothat.>> It does feel Gavin like we have crossedover for early stage venture to a pointin which there

00:18:21is a third way. Eitheryour company had M&A and we saw in thepresentation yesterday that during thewrath of Lena there was no M&A and theyjust froze the market. Now it's comingback. IPOs we did have some freezing ofthat market for certain periods. Butthis third way is now fantastic. I cantell you as the earliest of the early weare now pari pursu selling into everychance we get because our averageinvestment is at 10 to$20 millionvaluations. When they hit 500 million Itell the founder you're going to startselling at 500 million. I'm going tosell right alongside you so that I caninvest in the next you coming into themarket. Everybody's fine with it. I butI can tell you six or seven years agowhen I did this with a company theybegged me to not participate when theyhit peak zerp 2021 they begged me JayCal you have to be loyal to us you can'tsell paru and I said you you guys areclearing 40 million of the $110 million[clears throat] round I'm just asking tobe next to you same amount can I askKelly a question how do you systematizethis so that it's like an exchange solike if we just want to hit the bid wecan do it like what I don't like aboutthe secondary markets is, you know, Iask my CFO, he calls five guys, then myfun

00:19:36CFO, she calls like four. You know,>> it's like ticket brokers. We get a bunchof bids. None of it makes any sense. AndI'm like,>> and I'm already dealing with, as Bradsaid, the agit from the CEO.>> It's got to be easier than this. Like,>> yes. Yeah. Look, we 10 years ago, wesaid there needs to be infrastructure topull this off. This can't just be a bigshadow market. We're sort of in thistipping point now where we spent thelast 3 years building this brand newplatform so that a company could pluginto it the same way they could list onan exchange and say we're going to offerliquidity. And furthermore, if you're aVC and you're on that cap structure for10 years and you want to offer LPliquidity, you can do it in>> to be specific. What do you mean you'relike we would be plugging into Schwab's30 million humans that are buying stuffon? There's there's a platform. Webrought a a platform with about 3million investors and now we're going toadd 46 million investors to them.>> Yeah. But wait, hold on a second. Aren'tthose are those accredited investors? Dothey need to be? Because we just had thechair of the SEC on>> So today, if you are trading individualshares, whether it's in an SPV or directon a cap table, you're accredited.However, there are products coming tomarket, we can

00:20:51talk about this in detaillater, that have 60 companies, includingSpaceX, that are listed products forunacredited $500 minimums. And thatcapital for those funds will be theunderlying>> closed end funds.>> These are interval funds.>> Interval funds. He's got one out now.>> I think Naval just did USVC as one ofthese. He's gonna contribute to>> now. the closed end funds>> are are a very different bet becauseyou're betting on FOMO because if youlook at the underlying value of some ofthe assets and those closed end fundsthey have no bearing to reality of whatthose underlying shares are actuallyworth. So price discovery is another keycomponent of this structural shift. Butto answer your question specifically, ifa VC's LPs want to recycle or want toget liquid, then a platform like thiswill allow them to recycle that capitaland put it back into the next vintagefund if they want.>> I have a I have a question for you basedon this. When these returns come out,the meanreturn in venture is going to lookincredible.The median return is still going to beSo walk us through how people will sortthrough that and the

00:22:06reality of what'sgoing to happen in the next year.>> Well, so I think there's there's twovery important things. one, I observe ifyou if you were a venture firm and youdo not have material exposure to one ofthese trillion dollar plus companiesthat you had many many chances, youknow, to to buy into. You're not onlyyour returns not going to be good, butyou're not going to have DPI on arelative basis, but you're not going tohave DPI. And you know, there'sexceptions. you know are you know youknow great series A firms they may nothave this but their returns are stillamazing with great DPI but in so I ambeginning to see venture firms who don'thave exposure to one of these companiesbehave in strange ways because I thinkthey're starting to feel a little bit offranchise risk because their DPI andtheir returns are going to go from youknow hey top quintile top tile tile>> so they're doing unnatural ads doingunnatural things. They're writing what Isee as call options, like a bunch ofthese, you know, Neolabs. Well, I need astory. I've done something. And maybesome of these call options pay off, butI do think they're engaging at somelevel and maybe>> they're

00:23:22chasing it.>> They're chasing gambling terms. Whereasthe people who have exposure to this, Iare being a lot more disciplined becausethey know they're in in in a greatposition. I think another very importantdynamic is going to happen in the worldof longon only mutual funds andcrossover funds. So, Long Only MutualFunds, uh, you know, my for formeremployer, Fidelity, amazing place, loveit. Uh, Bailey Gford, Capital Research,Wellington,>> Tro, they all can, per SEC rules,allocate up to 15% of their funds intoprivates. And these are the biggestpools of capital in the world. Theydwarf sovereign wealth funds. But, youknow, most firms, because they don'twant to get in trouble with the SEC,they say, "Hey, we're going to cap it at3% or 5% or 7%. It was very public.Bailey Gford was forced to sell SpaceXlast year>> for regulatory reasons. And um what'sgoing to happen as these companies gopublic? All of these long only mutualfunds are by and large finding it hardto participate in private markets rightnow because they're at the limits oftheir self-imposed>> 3%>> 3 5%.>> When a company goes public and thelockup expires, it moves out of thatbucket. Nice.>> So, this is going to

00:24:37be hundreds ofbillions of dollars of new late stagedemand that is coming back to the marketafter kind of being out out of themarket for a while.>> That's a lot of dry powder. There's alot of dry powder.>> The net trade is up. Then the themarginal trade is is up.>> Founders are going to be in the cap birdseat. People are going to be looking toput money to work. Interestingbuzz going around about accreditationrules. We had the head of the SEC onAllins interview show. We did it. Andthey're going to have a sophisticatedinvestor test, something I've beentalking about for a long time that wouldreally democratize the way InvestAmerica has access. Um, and then funds.I've been getting pitched for years on,oh, put your fund on blockchain or sellyour fund into this ETF. Maybe you couldtalk a little, Kelly, about thepossibilities around venture funds beingmore tradable like secondaries are. Isthat on your road map? Obviously,there's demand for it. What would thatbecause I can tell you what that woulddo for my LPs, you know, Brad Chamat'sLPs and and previous funds. If you couldcome in and out of these funds, the wayyou can come in and out of anthropic, mylord,

00:25:52that could be just incredible forfolks who, I don't know, they have adivorce, they have a life event, youknow, just a little more fluidity.>> So, there's been there's been secondaryfund trading for a long time. Um, Ithink blockchain and tokenization makesit more efficient. That world will willcome. But the question we're askingourselves now is if you're an LP in afund that's holding something asvaluable as this, uh, are are you reallyinterested in trading your fund positionor do you just want to get out of>> the big winner, that name?>> Um, and and our view is it's probablythe latter.Um, and in some cases funds will come tous and say, "We've got a vintage fundthat has two companies in it that are 15years old and we can't clear that fund."And so that's that's an application ofliquidity to the market that we think iscoming to the market.>> Are you are you worried at all over thisnext year about this idea of retailbeing exit liquidity for these threeginormous companies? like is is thereany risk? Like how do you bucket therisk? How do you manage the risk? Yeah.>> What is the

00:27:07risk if something were tohappen? What's the blowback?>> I was talking with Brad about thisyesterday. We're we're watching thesevaluations and these multiples. We hadthis conversation at dinner last nightand saying, "Wow, these are these areextraordinary and people should comeinto this market." And>> extraordinary is a coded word for>> uh it's you know, it's okay fine. Um>> it's a bubble. You're saying you'resaying you think they're high thevaluation.>> I think the retail investor coming intothis space needs to look down market andlook at interesting opportunities thataren't the things that are on CNBC everyday and have access to them earlier. Andwe had a bunch of retail investors showup in 2018 and 2019 that wanted to be inSpaceX and they're and they're thrilledthat they got in when the valuation was30 billion.>> Yeah.>> Um and I think if the market opens up,that's what we'll be talking about. whatwhat's what what do I want to get intonow that's not you know at the very verytop of the market getting ready to gopublic>> also Brad and Gavin we're getting bettershout out to um Gurley we're gettingbetter at pricing these IPOs and notleaving money on the table they're fullyvalued in most cases when they go publicyeah or in some cases>> they're still mispriced they'remassively mispriced>> well no we we have seen some that

00:28:22havegone down you know after they go out soyou know>> nothing good that anybody wants>> I mean listen anyway what what do youguys think is are we are we closer tocorrectly pricing them?>> I mean Gav and I have been doing this 25years. There are moments that the publicmarket is undervalued relative toprivates and moments where privates areundervalued relative to public. Rightnow everything in the world oftechnology is pretty fully valued,right? Like it's you can't have theparabolic moves we've had and think thateverything is cheap. That's not to saythat we're not going to go higher, butwhen you've been punched in the facesmany times, as all of us have over thelast 15 years in technology, we knowit's a jagged line up and to the right.So for the retail investor, so long asthey have staying power, so if if you'regoing to launch a product, as long asthe retail investor can stay in thatproduct through the draw down, they'regoing to do fine. The problem is most ofthem yolo at the top because everybodygets them all jimmied up and excited andso they're, you know, they're leveringup. They're doing 2x levered, you know,memory trades and all this that Gavand I are. There are 14 ETFs launchingon the day of the SpaceX

00:29:37IPO that arelevered ETFs into SpaceX at likewhatever 1.75 trillion. So, this justtells me that there's a lot of signal.We may not be at the top, but we ain'tat the bottom.>> We're bouncing along. The top might be afair, you know, you got to allocateaccordingly. And that's what activemanagement is about. If we do not ifwe're not thinking about that, when whenpeople are puking into their garbagecans at the start of the Iran war andthe market is down, Gavin and I arelooking at each other and saying, "GoodGod, these anthropic revenues are offthe charts. We got to get more dollarsat risk. shove more onto the table inboth anthropic and public market stocks.But then 75 days later, it's allchanged. Right now, the market,>> have you guys ever been in a marketcycle [clears throat] where these movesare just so concentrated in time whereyou take like a year or two's worth ofmoves and you compress it into 30 days,60 days?>> I mean, this is nothing relative to 99and 2000.>> Nothing.>> This is nothing relative to that.>> Like, I mean, describe describe. Yeah.Just package. Sometimes they wake up.>> What was 992000 like in terms of like aif this is a roller coaster, what wasthat?>> Yeah.

00:30:52>> And what was that? I mean, I don't youknow, this is this is this is like a uhthis is a roller coaster that's um likekind of a gentle sinewave.>> 99 was Vegas on a Friday night after waytoo many drugs.>> Okay. Like it was out of control nuts.CMGI had no revenue and the stock wentfrom $2 to $2,000 over the course of,you know, six months. They buy FoxboroStadium. They're on the cover of Timemagazine and they're out of business 2years later, right? Like that is verydifferent than Anthropic, Open AAI, andSpaceX. These are extraordinarily realbusinesses. So, I think the bettercompare is like 2021. Yeah.>> Right. Where valuations get ahead ofthemselves or they're at the top end ofthe range. We could have a normalrun-of-the-mill consolidation in thepublic markets in the semi-index of 10or 20% which means high beta would bedown 30 to 40% and a lot of people whojust got in would be panicking right butthe people who have been in for 6 monthsor 3 years would would would notice thatthat's just a blip. So I don't thinkit's at all like that.>> Okay. I have a question for the three ofyou. Four. Yeah. Final question.>> I have final question. Take the top 10names private

00:32:08companies off. Okay.Forget those. You can't pick those. Giveme a sub,you know, in the tens of billions, fewhundred billion private company that youcould buy today a secondary in that youdo not own that you would want to own.I'll start with you, Brad. Just goaround the horn. Something you don'town, but if you had the chance to buy asecondary, you would.>> I mean, I take a company, you know, inthat what I call inflection growth,Jamas. So, these are companies, thethousand companies that are over 3billion, but let's call it sub50billion. I think it's the trickiest areaof the investing landscape. Um, becausethey're the beneficiaries of highvaluations, yet they still have binaryrisk.>> Right.>> Right. Like Anthropic, OpenAI, SpaceX, Idon't think these companies have binaryrisk, but there are a lot in, you know,in that bucket that do. Um, and so Imean, we own most of the ones I want toown. I I I can't give you one that wedon't.If I want to own it, I I generally ownit.>> It's a hard question. [laughter] I'llgive you How about the last one you say?I'd say like Sierra Brett Taylor'scompany. Um, you know, what do they do?>> So, they're building basicallySalesforce>> agent native.>> Got it.>> So, sales,

00:33:23marketing, customer serviceagents that are agent native. I'll giveyou the downside and the upside. We alsoown a company called Parlo and the samespace in Europe that I think is reallyinteresting. downside open AI andanthropics say we're going to do thisand all of a sudden it eviscerates theirhundreds of millions of dollars inrevenue. The upside on on thesebusinesses is that they actually havealready built very sophisticated agenticlayers and that all these guys Meta,Google, uh SpaceX come along and say wewant to buy you because we want toaccelerate our path into agent.>> I I'll give you the name that I wasconvinced of today yesterday by um byThomas Leant which was Revolute.>> You know, I had always the kind of likeI had some early Jack like I owned someCoinbase, I owned some Robin Hood, wedid all of that stuff. It was fine. Kindof ignored fintech and Thomas backstagegave me an incredibly we were togetheran incredibly compelling pitch forRevolute and and I and I actually wentand I was like, "Okay, show me what theRevolute share prices in these secondarymarkets." I got kind of curious. Maybe Ishould pick up some that. So [snorts]that that would be my>> What does Revolute do? Explain for theaudience.>> It's a bank. It's a bank. And what'sinteresting is it's a neo bank that hasa completely next generation stack. kindof what Brad said is like that theme ofyou rebuild it in the modern era and youunbundle

00:34:38the incumbent that that has alot of legs and in a regulated marketthat has a ton of legs and so you knowthey're doing really well in Europethey're coming to the United States thefounder seems to be just an absolutestar>> tens of millions of customers 14 linesof business they're like a billioncurious like that I I have Gavin do youhave one that you've bought recently>> no I would just say um well you know twonames that um we've been involved inpublicly is leading are Arya and Drivetsand they're both in the networking spaceand basically as um data centers getmore specialized and complicatedyou you're going to have increasinglyspecialized chips it's called thedisagregation of inference and pre-filland decode and to make all of thesechips to work together like a symphonyand have the kind of the right chip forthe right job at the right time I dothink we need to reinvent networking andArya and driveets are coming at thein a very different way. And if you'rean AI lab,>> you've been one of the earliest. I'llgive you credit. I think that you youyou framed this on one of on a podcastthat I saw, which is there is animpending super cycle in infranetworking, silicon, and you've reallybeen at the front of it. I buy into itcompletely now, too. Really, it's areally It's really good. It's really anynames.>> Uh Neuroobotics

00:35:54in Europe.>> Neuroobotics is a company name.>> Yes. and uh AI powered um logisticsrobotics.>> Love it.>> Um they're not in the main strip of highvalue real estate in Silicon Valley.They're in Germany.>> Uh quiet company, big investors, 100million revenue, kicking ass.>> Love it. Jason, well, I you know, I Ihave a couple of thesis uh that I'vebeen looking at. One is what is Elonhelping put into space as the price goesdown. And so we did uh direct on the captable and SPV for vast which is buildingspace stations and we think they'regoing to win. The other one is what I'lljust call Uber 2.0. You know, we girlyand I took a lot of notes on that, Brad,as well. And so we were able to dozipline and we we put a small ticketsize into zipline as well because if youcan take the delivery cost down from $15to five and then eventually two, that'sgoing to just drive consumptionmassively and it's going to happen inthe air. And these actual drones hadsuch a false start that everybody gaveup on the entire sector and now itworks. And it was just a very simpleinnovation that Keller told me, whichwas it's the drone stays up in the

00:37:09airand drops a tether with the box in yourburrito. If you grab the tether and youpull it, it just comes down. You don'thave to land like this giant robot inyour backyard with blades spinning tokill your dog. Well, I think there'sactually a very important like onZipline. It's an amazing It has donegreat things for the world. Um so my myat trades is also uh in involved inzipline but zipline started so the hardthing is to make anything autonomouswork you need to get it out in to theworld and gathering real world data.This is how AI works and it's hard toget approval to fly things around umautonomously in American airspace. SoKeller had the idea of we're going to goto African countries and we are going tode you know if a we're going to help ordeliver medicines to these smallvillages and they focused on maternityand they have cut the maternal mortalityrate in some of these African countriesby 90 to 95%. And so you're in a smallvillage, there's a one midwife, there'san app, a woman goes into labor, theypress a button, and you know, an hourlater, a zipline drone drops arefrigerated package of modern medicine,blood, and everything needed.

00:38:24They didit for seven years>> and it's had a huge impact on healthoutcomes in these African countries>> and now it's come to America.>> I I this is an incredible story and I'vebasically now reconstructed my firm todo the barbell. I missed the seedinvestment. I turned him down because Iwas like, "We don't invest on thatcontinent. We don't have any insightinto it. We don't understand it andhardware is hard." And he has the email,whatever. And I've stayed in touch withhim and he said, "Listen, I figured itout." And I said, "Hey, you know, I havethe syndicate. Let me see if I cancorrect that mistake. May I invest?" Hesaid, "I I you're my dream investor.I've wanted you on this whole time andit's just so important." Um, no. No.we've been friends for all this time andI've you know I have had him on the podthree times>> and he said when are you going to be onthe cap table and I said you know what Ilearning from you guys specifically thislate stage stuff I'm like well I can dothat and here we are and>> on that note>> yes>> let's wrap up>> yes well done guys thank you so much>> thank you Kelly thank you>> thank Thank you. [music]

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