Zach Weinberg on why AI won't cure disease, the NIH funding crisis, and pharma tariffs

welcome to the show. For having me, guys. Excited to be back. Are you back in LA? I am. It's funny. The the last time I dialed in, the tariffs dropped. I think the mid I hung up with you guys. So, yeah. Yeah, it was 4 4 p. m. that day, aren't I? I I was I was in such a haze.

I I think I texted you quite I was like, uh, what's the reaction over in Switzerland and you were like, not good. Not good. Uh, but now now, you know, we've seen things. There's been a pause. There's been ups and downs. Uh, there's still the 10% base tariff. Yes. Correct.

So, so, so what what was the whole journey throughout watches and wonders? Very funny timing. uh be there on the ground. Uh take us through the reaction as things developed and where the heartbeat of the industry is right now. Yeah.

And I think you can you can split the conversation kind of between the primary market and the secondary market. And so I'll intentionally walk through that.

Uh on the primary side, I think all the meetings I had the day after chatting with you guys, the tariffs dropping, there was a lot of like the Spider-Man meme pointing at each other like not really knowing what to do right now. Um, and I think you can split the reaction from brands kind of by the type of brand they are.

You have like the the giant massive brands that everyone knows like the Rolexes and the Pex and the APS of the world. Uh, and their reaction is decidedly different than some of the brands that sit kind of in the middle of the market.

um for every brand that isn't these like very very very top tier elite brands their focus was how quickly can I get product to the US um and whether it was functional products watches that are just parts like they just wanted to move everything to the US as possible from most of the meetings that I was having um on the larger brand side I think they had the luxury of sitting and waiting and seeing what was going to happen um you saw the Rolex of the world and things like that take their time.

And the initial answer that that I got from secondary feedback from from authorized dealers meeting with Rolex that week was the large feedback that that Rolex tended to give in that moment was like, we don't want to pass this on to the customer, but we're not going to eat the cost of these tariffs either.

So, we're just going to hold off. And the main focus point was we'll make it harder to buy outside of your local markets.

Because I think a lot of the authorized dealers in the US are all of a sudden saying, "What happens when all of my core customers decide that it's actually cost efficient to prioritize that flight to Paris? " Oh, interesting. Go buy that watch there. The thinking was how do we keep it in the local markets?

Unclear how they'll hold that out, right? So that's really tricky. Yeah, that's what was happening in the primary market in the moment. on the secondary market in the US particularly.

I think you saw a lot of dealers think it was an amazing moment for a second where all of a sudden the inventory that was existing in their in their lots in in the US was was much more valuable than it was, you know, a few minutes before the terrorists were live.

And so on the secondary side, you saw it really came down to like what type of dealer and what your economics are.

If you're a dealer that happened to have a lot of inventory and you don't have a hard time stocking that inventory again, you have great sources, you had a lot of folks that just saw deals come through in an increase and they just sold them. Like they moved product and that was like the name of the game.

And then you saw a lot of other dealers try to opportunistically jump their prices, you know, 10 plus% uh to all of a sudden increase that value. So, we saw the best weekend we've ever seen after the tariffs in the sense that there was a huge increase in demand and everything.

Everyone was out trying to buy those watches. Uh, and then the prices, I would say a lot of them are 10 15% more than they typically would. We haven't seen a lot of like the craziness like no one's pricing in selling at 30 plus% to try to match the 31 uh% move.

And then um since they announced the 90-day moment, I think things have chilled out a little bit. We're still seeing pricing being up 10ish% on a lot of the sales that we're seeing come through. Um but it's really interesting to see what dealers are going to do.

I think it's a question of if you believe the 31% is going to hold and if you do, I think you're starting to stock up right now. If you don't believe it's going to hold and it's purely a bargaining chip, then I think you're kind of sitting and waiting out and seeing what happens next.

Are there any uh American watch manufacturers there just like popping champagne like the Hamiltons or the RGMs just being like, I've been waiting for this. I'm finally going to catch up to Pekk. Uh not a ton. It was It's very It's very Swissentric while you're there. Swissentric.

But uh it certainly would be a good moment to be but it was like a lot of these brands were lamenting because especially on the independent side like they had just opened up New York boutiques or they had just signed the lease in LA or whatever it is and so uh the question was how do we get product there and a lot of the independent and smaller brands the answer kind of became like I I'm willing to forget the US market for a second like wow can I come up with other SKs in Europe that make up the revenue I lose in the US or can I just incentiv especially on the six figure plus pieces.

Can I incentivize experiential moment where I take my best collectors and I organize a trip where they come to Geneva and hang out with me as the CEO and and they buy the pieces there, right? Yeah.

And and is that uh I mean obviously that's like probably not completely kosher with the tariffs, but watches are unique and that if you buy one and you throw it in your suitcase and you're wearing it as you come across, like how would they ever know that you bought it while you were on that trip, right?

That's the nature of the game. I think most people they buy it, they strap it on and they walk out. Yeah, makes sense.

What about uh so one of the big concerns last week is that even for example auto manufacturers that make cars in the US, a lot of those parts come from overseas and specifically China for the Holy Trinity brands. Uh are they making every single individual part in Switzerland? I they I've seen those claims thrown around.

it almost is inconceivable, but it seems to be the case that they're not dealing with, you know, the same um reciprocal tariffs from from China or anything like that. But I I'd love uh to get your point of view there.

Yeah, I think for for most of the brands that we're talking about, everything's made in house and and even a lot of the brands that that are are, you know, using generic movements, like they're buying generic Swiss movements for for the majority case and like these, you know, $10,000 AOV plus Oh, did we There are a number of brands though that will manufacture or use parts from other places and then yeah, they'll they'll behave with those tariffs 100% especially on like the I hate to say the word cheaper, but but on the the kind of cheaper less expensive less expensive is the right word.

You're right. Um what about uh any any further thoughts on the Land Dweller? Uh were you surprised at at where it's being priced on uh on the secondary market at all? Where is it being priced? I think the steel is roughly sitting around high high30s, low 40s. Is that correct?

Yeah, we we actually we haven't seen any come through yet. So, I'm yet to see like a transaction or a listing on Bezel for it. So, uh kind of waiting to see where that lands, but uh yeah, I mean double retail I said I think I said that last week. I think that wouldn't surprise me at all.

I since I I spoke with you all, I had a chance to like see it in the metal and and put it on my wrist and and play with it a little bit and and I liked it a lot. I didn't think I was going to like it as much as I did. Frankly, I didn't want to like it.

Not hater at all, but um it's just Rolex has this thing where they they they drop a model and it it's just always good. Like there's a there's an executed finesse in everything that they make happen. And and sometimes it's fun when when it doesn't work out, maybe. And it always works out. So, it's it's quite nice.

I like the rose gold example better. Yeah. But what is the base price at retail for a Rolex land dweller? I think I think the steel example is 14. 14. So yeah, more than double. And then uh when the first one comes through, can you talk to me a little about like how you think about that deal on bezel?

Are you going to push that person to do an auction? uh is that a better move for someone who is sitting on a land dweller who's thinking about selling it or should they just try and price it uh through the normal marketplace? I think like uh we'll leverage the auction probably to do it.

We did that with the cubitus too like we we sold I think we sold if not the first cubitus at auction one of the first to go cubid eye to come out at auction. Um and uh I think we'll do the same thing on the land dweller side.

Uh the fun thing is like the the folks that are buying the initial examples of the land dweller are doing so exclusively to be one of the first owners of the land dweller. I think it's like that is the you'll pay a premium for that.

Certainly the same thing happened with the cubitus and and any of these these like kind of new drops. If you want to be courtside wearing this watch and and have everyone know that you got it first then obviously you're paying a premium for that. I don't know where it's going to settle though.

like uh I imagine the premium for the initial examples will be certainly over double retail. Um but then like is it going to be evaluated like it's an in a Royal Oak kind of like very hyped?

Is it going to settle to be similar to a Datejust where it it you know it trails it's a little bit above retail but it's you know not as exciting. I don't know. It kind of splits the middle there.

Obviously, I'm I'm leaning more towards the hype train, but yeah, the the thing that makes me think it potentially pretty sustainable is just it's a great looking watch and it seems to wear really well. I think I saw the picture you posted and it just looks great.

It's hard to it's hard to not like uh even if you're not a Rolex guy traditionally. I liked it when the sentiment around PC right now. Uh, I felt like the general react that the the felt like the reaction to the Cubitus couldn't have been worse online. I mean, like so many people just didn't like it.

I think it looks fine. It wears well, but like what what's the feeling around the brand um, you know, last week? Yeah, I I think like it was cool to see them double down on a lot of like traditionally interesting PC models like they're not they're deviations from the sports models.

like you know there was a really badass Katraa that came out in platinum with the salmon dial and it's incredible and I was my favorite watch in all of watches and wonders um to see in the middle uh and they came out with a 40mm cubitus which I think is a is a very fresh take on the cubitus.

The other one is just quite massive and doesn't really feel right in the wrist in in my opinion. I think the vibe against the cubitus is like similar to Rolex, Pate tends to not miss like they they they kind of bat a thousand when when they do things.

And uh I think everyone wants these big brands to catch an L so they can talk [ __ ] about it and feel like, you know, they're they're able to say that.

Um, so I think the cubitus like paired with a bit of like an interesting take that felt maybe like it was overly modernized from a marketing campaign like didn't sit well with a lot of early early um collectors. But uh yeah, I don't know. I think like I put the 40mm one on. I I liked it.

You know, it's it's like they make great watches. It's a little bit angular and I'm a bigger fan of like a 5711 Nautilus. Um, but you know, if I was allocated one of those things, I would certainly wear it and I would rock it. Love it. What uh any interesting takeaways around the secondary market?

You were on a panel uh specifically about the secondary market. Was there anything I'm curious what your major points were and anything else you kind of learned from other people that may have been on the panel or just that that attended the event?

Yeah, it was it's really cool to hear like how the brands are thinking about the secondary market and how the difference from from how we're thinking about it and just I think where it's going and I think it's you know we entered the space when the secondary market from a brand perception was was kind of like gh don't don't don't dip your toe into it by primary only and now to see that you know I was in a panel next to Vasheron Constantine I was in Sabes and you have you know a bunch of representatives from all the top brands at the panel Um, it's quite cool to see that these primary brands are now embracing the secondary market is something that's quite interesting.

And I think it allows customers to feel comfortable kind of interacting with the space as long as they're asking the right questions and they're making sure that they're focusing on authenticity and they're buying from reputable sources.

And so it's been awesome for our business because it allows us the avenue to double down on our initial goal which was just make a really really safe comfortable experience to transact in the secondary market, lower the barrier of entry to buying your first watch, but also just generally if you don't want to wait on a wait list, you know, come through and transact and buy the things you want.

And that's why like the tariff conversation was super interesting for the secondary market because if the premium from you know on a lot of these pieces from the secondary market to retail is close to 30% all of a sudden if a primary market watch is 31% up from a cost perspective that delta is certainly meaningfully decreased.

Do I actually want to wait on a weight list any longer or should I just buy one that's available in the market in the US? Of course sellers know that and they're pricing it up 10% but it still makes that that difference smaller than it was.

And so all of a sudden, maybe it's not as appealing to wait 2 years to get that Royal Oak versus just buying it right now and and getting it when I want it. Never wait. Never wait to buy a Royal Oak. Always buy one just immediately. just do it.

Um, what how does I'm curious uh how does influencer marketing work in the uh you know for a company like Rolex when you know it feels like there's just this permanent stream of images coming out from the most influential celebrities in the world and whenever I see one of the pictures because I've been like involved with influencer creator marketing forever I'm always looking at the image I'm like does um you know does this athlete always roll out of bed and want to wear a Rolex, you know, like does Tom Brady always want to roll out of bed and wear like the it Rolex, you know, Submariner of the day or uh is there some type of, you know, sort of transaction happening behind the scenes, whether it's free watches or, you know, it's totally possible that they just love the watches and there's enough of them out there, but but I'm curious if you have any insight there.

Yeah, and it was a big influencer marketing year for Rolex. Like I prior to Watches and Wonders, they they hinted that there'd be like a massive announcement and we were all kind of spiraling like is it a new model? Are they launching a new platform? Like what's going on?

And they just announced Leonardo DiCaprio as an ambassador. And they dropped the whole like Rolex family page where it talks about like all aspects and touch points of creative entertainment, sports, whatever. Uh the dominance they have on like really influential people.

Yeah, they they call their they call their family page a celebration of human achievement.

And it's so funny because I didn't see the announcement about Leo, but I just uh Instagram just like serves me pictures of, you know, celebrities wearing watches and I'm always just like that Leo doesn't go anywhere without a Rolex on and and it seems like now it's like, okay, yeah, he's contracted to basically be like, don't leave the house without a Rolex.

And everywhere he goes, he's just getting photographed and and it's just sort of like that natural marketing. Yeah. And it's funny because I mean, Leo was a tag guy for a really long time.

Like there's that that story where the the um in Wolf of Wall Street, he's wearing what looks like a like I believe it's like a vintage GMT Rolex, but it's actually a tag horror that they had like intentionally made to look like it was like an old 80s like you know stock markety looking watch, but it was it was tag.

So, um, I think the interesting part, you mentioned Tom Tom Brady. Like Tom Brady was an IWC ambassador for a really long time. I love those brands. I think like it's a lot easier for those guys to be a Rolex ambassador than maybe another brand that they don't wear as much.

When you ask the initial question of like, do I feel comfortable wearing this everywhere? I would love to be a Rolex ambassador. I think they're very lucky because it happens tap happen to the brand that everyone wants to wear a lot of the most. Same with the APS of the world.

They have a lot of amazing ambassadors there. Um, but yeah, I think there's undeniably uh a set of collectors that that don't want to be ambassadors because they want to wear a diverse collection, right?

Like I you saw the same thing uh I remember sitting down with with um some early investors in GOAT and they capitalized that in the sneaker space where you had athletes and folks that didn't want to just wear Nikes when they stepped out.

They wanted to wear a more diverse set of street wear and and shoes and whatever it is. and the goat became the business that allowed you to to catalyze that and wear multiple things.

I think the thing same thing is happening in in the watch space and that's why I'm so excited to build kind of consumer brand around the secondary market if it's like you can get to a place where you can have a watch sponsorship but it's like more of a secondary oriented one.

So you're making the statement that I like wearing watches but I have a diverse collection. I'm not necessarily bound to one specific brand. That being said, not a bad gig to be a Rolex ambassador. I think it's pretty good. What What are some of the known unknowns in the watch industry for the rest of the year?

What are the things that we might expect announcements around, but we don't have the final details on? If we want to be completely dialed in going into the next Watches and Wonders, what should we be tracking today?

Yeah, I think like the immediate term known unknowns is is like uh kind of a general like I don't know what's going to happen with tariffs. It's going to change everything from from that perspective or is it going to fizzle out and everything's going to go back to normal? Got it.

So we might so we might concretize that by saying something like uh if we see an increase in uh Rolex's stated prices on their website that would be a reaction to the tariffs, right? Precisely. Yeah. Yeah. um like are those prices going to be passed on to the consumer?

And I think like the consistent known unknowns that are always fun to to you know posit ideas on in the watch community or or like what's coming next, what's being updated next.

Uh we were talking about this via text before the episode, but like there's a very cyclical process that exists every year for a lot of these major brands. Like Rolex pretty much exclusively drops models that are in catalog in watches and wonders.

So, uh, all year, uh, the watch community is throwing out their ideas, making renderings of what's going to happen next.

Uh, the, uh, introduction of the chat GPT image product has been funny to see, uh, because you're seeing all all of a sudden like anyone can render a, you know, a green whatever GMT or whatever makes happen.

So, um, and so the way that typically works is a lot of the investigative Instagram journalists in the watch space will look at what Rolex is trademarked or patented.

Like Rolex trademarked Land Dweller a number of months before dropping Land Dweller and everyone knew that, but it was like I didn't know what they were going to do with that.

And then you'll get renderings of the watches that are coming out and you don't know if that came from someone's Photoshop file or if that's real.

and then to go tie this home with the influencer marketing like Federer wore a land dweller somewhere in the Swiss Alps and dropped it on Instagram and it looked unintentional but I'm sure it was intentionally you know very much planned but um so I think a lot of the the known unknowns are like what's coming next what's going to be dropped and then and then what's going to be discontinued and and replaced um that changes the market significantly.

Yeah, that's very fun. Well, it's such a fun market to to follow. It's so interesting. It's It has all the drama of like, oh, speculation about the next iPhone with the fake renders, except the iPhone hasn't changed at all.

And so, no one really cares anymore, but it's like within in the watch world, it's like we're going from iPhone 3GS to iPhone 4 like every single year. So, thanks for coming on and chatting with us. Great to see you, Quaid. You too, guys. Thanks. We'll talk soon. Thanks for the insight. Talk soon.

Our official watch correspondent. I'll be right back. Super important. Uh, next coming into the studio, we have Robin from Avalanche talking about uh, nuclear energy and fusion in particular.

Um, I had a chance to go up to Seattle with Ben actually and do a whole tour of his facility and see how he's building a uh, probably I don't know maybe the smallest nuclear energy product. It's pretty small. Uh, it's almost the size of a battery.

like you can you can kind of hold this thing and uh but fusion not fision much safer uh much a whole bunch of trade-offs there which I'm sure we'll get into and I'd also like to talk to him about some of the deregulation efforts that are happening and and uh there have been some announcements and executive orders um a lot of speculation about what might happen even Keith her boy uh was talking about um long-term looking towards energy deregulation as a potential uh driver of uh innovation we talked to a few people about how energy G production is growing 20% a year in China and 0% in the United States.

We don't love that. And so I'm excited to talk to Robin and see if we can bring him in the studio and chat with him about how everything's going. Robin, are you