Jason Lemkin says if growth isn't accelerating, you're not an AI company — and PE has abandoned B2B SaaS

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Uh, well, we have Jason Lumpkin, the founder of Saster in the Restream waiting room. [music] Let's bring Jason in to the TV van Ultram. Jason, how are you doing?

I'm super excited to be here, guys. Thanks for having to long long long

overdue. I'm so happy uh that we were able to uh, you know, commiserate over the fantastic business that Davos is. And uh and now we have our planning session. We just talked to Tyler Cowan about how you're supposed to keep everything a secret. Um but here we need to do some open brainstorming. We need to do some open brainstorming about how we how we drive to half a billion in revenue because apparently that's what is doing.

I'm sure you want to stay on point. If you want my advice, which you should ignore.

Um starting next year, take some off the table.

Okay.

Um listen, TBBN is on fire, right? It it is great. You're you you've reached the point where you almost have too many sponsors. you have to turn them away. Um, but listen, if both of you guys could take out say 4 million next year, um, just put it away might not be the worst idea for a media business, right?

Yeah. Yeah. Yeah. Yeah.

A small bit of advice.

When did you get into media? Like what what was the inciting element?

We were the opposite. I mean, there's good and bad for being in the early days or old school, right? You don't know what you're doing just like the early days of like SAS. But we just did meetups for our community in

2013, 2014. like a thousand people would show up to a meetup and now in SF it's like well at least last year it wasn't a big deal for AI but imagine in 2013 a thousand folks coming together to talk about enterprise software it was it was nutty right and so it

so it built a community and then accidentally did events which you guys should not do and then did media but I did it backwards right you guys were very intentional and it's pretty cool I was utterly accidental and dragged into it um but it's convergent evolution

yeah what what what are the best practices for events I We people talk to us about it. We've said no, we're we're we're staying focused. There's plenty of events. We get invited to a bunch of them. I have to say no to too many already. Uh there's a good event in most spaces. And I'm wondering like what you think makes for an actual good event.

Well, you mean from a business model perspective or from an quality of attendance perspective?

They're perfectly aligned, right?

Yeah.

They're not aligned. They're poor. They're arguably poorly aligned.

Okay. Let's start with the consumer.

No. And we we've experienced this cuz we we haven't done any events and and we've

we did one that was not

Yeah. But it was basically like a cocktail party and and like it Yeah. You you uh I feel like too many people like you got to really know what you're in. You can be in the events business.

Yep.

Or you can do events. M and if you're just doing events and you're doing events that you really want to be at and and participate in and you're making events for yourself, it's very likely that it's not a great business, right? Because like it's very possible you don't want to charge for tickets, right? Or you're charged for anything or all all these things.

A lot of conflicts, right?

Well, look, I'll give you I thought we might be talking about AI agents or the SAS market crash. We can do

we want to get to that there for sure. But if you want me to summarize learnings for events, which you guys have,

there are a handful of public companies in the space which are boring but have very high operating margins. Okay.

Um they tend to get bought out by PE firms and go public and go private. Here's the basic thing. There is a nut for these large events like Con Lions and Money 20 and even Saster

and it's going to cost you 10 to$15 million, maybe even 20 to turn on the lights.

Just to turn on the lights. So if you bring in 10 million or 15 million like a lot of corporate events do force they lose money

right if you can build that

they're also taking on extreme risk because let's say you have some black swan or whatever you have a bunch

I lost 10 million in co we lost I lost 10 million as the majority shareholder I lost $10 million it wasn't that fun

but if you get over the nut if you think about the nut and they're high this is why it's a terrible business but if you get over it it's almost pure profit that extra person you charge a ripoff ticket to for 2500 bucks that cost you 80 bucks, right? Um, but getting there is is wrecks the ships. And if TBPN has money, it's the last thing you guys want to do is just struggle to make 200 grand or 500 grand off an event because it's totally distracting, right? But if you get massive

and you keep your heads down, these these things uh, you know, the best of anything makes a lot of money, doesn't it?

Of course. That's always the nature of these things. That's why we like focus. That's why that's why we like not doing events. Uh I am I am interested in your reaction to my my take that uh like the the dream forces, the meta connects, the Google IO's like this has put pressure on the on the uh crossplatform tech conference. Uh you know Mark Zuckerberg doesn't need to go to CES to announce the Meta Rayban displays. He hosts his own conference. Uh you know even Sony and Xbox like they can they don't need to go to CES even if they have a presence. it it takes away from like the aura and importance of those events. Is that something that you that resonates with you or is that sort of overstated?

Well, I don't know that events have worked for a product launch since like Steve Jobs. It's all it's now performative.

It's very mimemetic with Steve. Yeah.

Yeah. Satcha getting up on stage and talking for four hours about what's at Microsoft. It's already been leaked on TBN and everywhere else yesterday. There's no there's no energy. But so I think that and to the extent events are still doing that in the age of AI, they feel very dated.

Mhm. They feel super dated. But the meta question is in the age of AI when I mean literally at Saster we have 20 agents that replaced eight people. Okay, we're running it all the time. We're at the bleeding edge. When and why do we want to meet people

in personal and business lives and meeting I mean

you know you I mean you you guys know I mean you can you we're meeting over Zoom. It's not a tenth as valuable as if I was there in person with you. And we're friends forever, right? We're fake friends right now. And so what what does that mean? What does that mean for building relationships, business relationships, pretend relationships? So, getting people together is super important.

Yeah. I to to maybe say it differently, AI could be incredibly bullish for for events businesses because if you're just constantly online being just completely flooded with inbound and bots and bot phone calls and all this stuff and you don't know really who's real and who's not, then in order to figure out like actually how you want to who you want to partner with, who you want to make uh how you want to make decisions, maybe you do need to get together in person. you do the the thing that um just like a lot of things in AI that the the surface level misses some of the complexity. The flip side is as as humans as culture and tech you know since 2020 we just don't want to get out of the house.

We don't want to go anywhere. We don't want to travel. We don't want to meet like sales folks don't want to meet customers in person anymore right and so even if we know we need to do these things to go to these like we just we all we're either 996 or we want to work from home in our pajamas. There's nothing in between these days. And so it actually creates a challenge for all the reasons we need to get together. Every 99% of us would rather be working from home.

Mhm.

So we'll see. We I don't know.

Yeah. Yeah. Yeah. Sorry.

What uh I I'm sure they're all wildly different, but what are your conversations like across the portfolio today? you have a bunch of new AI native companies that and those conversations look one way and then you have you know a massive portfolio that all uh is navigating AI in different ways capitalizing on it maybe uh

AI companies are becoming SAS the SAS companies are doing AI everything's bleeding together

sort of

sort of

sort of my here's my simple rule guys if growth isn't accelerating you're not an AI company

oh

this is the flaw with the publiclix all the performance formative stuff all the public companies you guys talk to and follow has growth great that you built an agent great that but is growth accelerated

and that's service now I mean that's the bold case for meta like like they did accelerate growth they're spending a ton on capex but there's clearly the AI that they're baking into the ad matching platform is helping accelerate and so it's working

and the retail the advertisers that are generating the ads

we talked about this yesterday Well, sort of. But like let's look so so that's for sure. That's why but let's let's look at why Microsoft crashed. And I never know why Publix react the way they do. But

on the one hand, the AI side of the business is still blowing up, right? Granted, a lot of that money is coming from Open AI, but they did miss on the software side.

Yeah.

Um so it's not it, you know, there there's nervousness and you talk about advertising being up. The worst performing software stock of I of the last 12 months is the trade desk just just destroyed by all of this. It's complicated. So you the portfol my my my advice is it last year was deeply tough love now it's just tough

it's like you've had a chance to reacelerate growth like yeah everything got better since Claude 45 it got really good at 37 that's why replet and lovable blew up that was a year ago guys

you had a year whether you're agent force or my startups you had a year to reacelerate growth and honestly Salesforce is doing better than some startups

at least we we're actually probably the only organization of our size using agent force for real like we use it every day

and it works. I I I can't tell you how many startups their agentic product is like it's a co-pilot.

Interesting. Yeah.

So, did revenue grow? You had a year. You had two years. You're supposed to be agile.

Dig into that uh the the the tough love to just tough transition. I feel like there's a lot of there's a lot of SAS founders who uh got to growth stage, they got to scale. Uh maybe they started a decade ago and AI did reinvigorate them. um they got sort of back in the arena. Maybe they never stepped step down or step back, but they just it was it was a new reason to go into the office, fire, get fired up, be tinkering with the tools, pushing the team harder. Uh is there any is that just something that's innate to the tinker specific type of founder leans into that? Like what are you seeing across the portfolio?

I Well, okay, maybe two things. First of all,

sure,

that's a great narrative. I don't think in the real world it's that common.

Oh,

I talked to behind the scenes off the record. I talked to public company CEOs in B2B, my own portfolio, others a lot. Since our our agents blew up, everybody thinks we're some sort of a at least for GTM, we're the agent gurus. Okay, it's pretty interesting.

And everybody says 80% of their team wants to work like it's 2021. It's not simple. Everyone has to create a skunk works team or something and everybody's complaining because here's one reason the AI native companies are doing so well is they don't have to deal with the 20,000 customers preai

who still have feature gaps who are still using clunky software who are still have other competitors and all of a sudden you have 10,000 new AI competitors that don't have to deal with that old stuff and I would love to say I know so many folks that have that LA you know beginning of 2025 were growing 40% and now they're growing 80 or 110 10.

Um, I can only think of a handful.

Yeah.

How are you,

how do you advise around competition in specific markets? Uh, earlier this week, I forget who we were talking to, but uh, I had been talking to a founder. uh and he had some idea and I was just thinking to myself like sounds like a great idea but I can guarantee that four different YC companies are going to end up on this problem and you're going to be going headtohead and it's just going to be like a 996 versus 996 and like feels like you know somewhat of a coin flip who will come out on top even though you're super talented, super experienced. uh what's your view on you know the current state of you know if a category is exciting it'll have 10 companies kind of running at it aggressively

it's worse like that was I think that was the problem 6 months ago the problem today it it and and literally a seed investor who's very successful relatively new said to me yesterday I'm giving up because everyone can vibe code something I can't even tell the difference

I can't tell the now I'm very I've vibe coded uh 20 apps that have been used over a million times I'm in the top.1% % of replet. I know a little bit about this

and we we'll run out of time. You're not going to vibe code Salesforce.

We're going to we're going to hit the gong for that.

Numbers,

huge numbers.

You're not going to vibe code Salesforce for real. But you know what? You can vibe code something for demo day that looks really good.

Yeah.

Really? And the stuff that like even 18 months ago, you'd be like, I want to fund that. Oh my god, this is an agent for dental follow-ups. That's all autom like my god your jaw would drop 18 months ago.

Um and you know we're talking about um clawbot and and open claw and all this stuff today. You were just talking about it, right?

I mean I built my own version on replet a week ago. I thought it was pretty cool and now it's obsolete today for real. It's called

ren.

I built it a week ago and now it's worthless.

Wow. So so I mean demo day is coming up. Like what metrics uh I mean obviously you can have a polished product. So does the shift to being able to control narrative? Are we in the age of storytelling? Do we need to be focused just on ARR or cash flow at the earlier stage? Like what changes about because there will be companies that are created today and wind up being successful. I'm sure you're not bearish on just startups generally right now. The landscape is different, right? So what's different?

Yeah.

Look, here's the challenge. The challenge isn't even all the clones. I think we've accepted there's a lot of clones. I think we've accepted there's a thousand competitors now. M

um the the the the challenge that that I mean you guys know from the show, but I not all founders have internalized. It's just investors are expecting insane levels of growth.

Mhm.

Insane levels of growth, right? They want like the idea that you could go from one to 100 in a year is now seen as what you want to invest in. It that used to be almost unprecedented. It it did happen in the old old days. Right now there's there's companies that like I invent invested in early like Higsfield for for for video. People never even heard of Higsfield and it'sund and something million. Right.

It's over 200 now.

Yeah. But that's not like Harvey which we're talking about every week, right? Or lovable or replet. And so you and then and then the problem guys is you look at Figma and it's terrible but Figma Figma is is is almost soul crushing for investing because you can't get much better than Figma.

It's down from its IPO. which trading less than 10 times revenue and that's for get owning and creating a category.

Who who's invested in something much better than Figma. I mean, not me.

Sure.

So, on the one hand, it's great the best times of others. On the other hand, it's like Figma isn't good enough. Like, let's let's let's call it a day, guys, and do media companies because it's just too [laughter] hard.

Yeah. I mean, I've I've had at least a couple times over the last year where a portfolio company is like a company that is maybe a preede company trying to go out and raise a seed or maybe an A and they're they're like, "Hey, can you look at can you look at my deck?" And I'm like, "The deck is beautiful, but you're projecting to grow 3x this year and that's going to be a nightmare for you because it just doesn't look like it just doesn't look like the business is best in class anymore." Even though you're like, "Wait, I'm like I'm going to 3x revenue this year." just

yeah it's uh there and unfortunately there's no great answers to this right there's no great answers to the question that some great businesses will compound to epic rates

but they're unfundable now and they would have been fundable two years ago there's no there's literally I don't know what the answer is today right

what about uh how

what do you think is going on

so so staying there doesn't that just mean that maybe there's the same amount of entrepreneur same amount of building but just more founders opting out of the tradition venture capital track because if they don't actually have a solid use for capital, they should get profitable earlier, monetize earlier. I mean, integrating payments is easier with oneline prompt. So, just do it and actually pull your road map forward and get and stay lean and be higher leverage. Like I I I don't know. Is is that not an unreasonable conclusion that you'll just see more bootstrap successes?

You know, there's of course that's that's the dream, right? Um, don't raise too much money for TBPN. I keep it keep it lean. Um,

the and I think for for a little while when everything was easy, but when when things were growing well, but the markets were down 20 late 2022, 23 and 24, that was the dream. Guys, listen, if the markets have fallen out of love with us, we'll just we'll just do the Mailchimp. We'll just get to a billion in revenue on our own. Pay us all out a couple hundred million in dividends and see what the Lord brings, right? Um the problem today is that the pace of software development is so fast that you better you better have one way or another you better have four or five amazing folks on your team or you're going to get crushed by the kids at Y Combinator bootstrapped or not it does there's no time and I remember back in the day Michael Canon Brooks who was the co-founder of Atlassian came you know to Sster annual way back in like 2019 or 2018 and he said I was lucky I had five extra years like if I had any competition in the first 5 years of Atlassian, we wouldn't have we wouldn't have made it. There were three companies.

That's crazy.

What do you So, so

that's hopeless today. How you going to compete when people pushing out aentic crazy agentic products weekly? How are you going to compete?

So, so I I want to get your your take on this. So, we we were on a a podcast that got released earlier this week. John was talking about something that has informed

our strategy with TBPN from the beginning, which is that uh media is now barbell. You're gonna do great if you're a platform, a Spotify, a YouTube, Netflix, etc. And uh and you're gonna do great if you're a personality individual, low low opex, you're just like Joe Rogan, you're creating content. Uh but if you're in the middle ground where you have like, you know, a 200 person team and kind of competing with personalities and the platforms, you're going to be in a rough spot. Uh a buddy of ours, John Palmer, was saying yesterday he thinks that software could go in that direction where if you're one or two lean lean lean operation, you're competing with big companies, you could do well. If you're a huge platform with distribution and scale like a Salesforce or Google, you're going to do well. But there's kind of this this messy middle that uh could could get kind of uh churned through.

Well, it's just I Well, first of all, I think all of this vibe coding, I think people miss the point because they're not really doing it right. Um and um you had the great guy, the economist on before me who yeah he was great and you asked him have you actually used any of the agent products. was like, "No, he was honest." Right. Good. Kudos to him, right? Most of the folks talking about it haven't. Um,

what Vibe Coding is already unleashing, um, is if you want to, to your to your point, if you want to build a super niche app for real, I want to build software for uh, webcasters with scale. Okay, there's 11 customers. There's TD TBPN and 10. That's all I want to do for my dream. If you are willing to to to vi to do it for real, not for an hour, not oneshot it, do it for real, you can now build that software without an engineer.

Yeah.

So that is amazing. And so we're seeing whatever a thousand flowers bloom. Um I was the first investor in a company called Rev Revenue Cat that does um powers mobile subscriptions for 50% for 50% of mobile apps.

And Andre published basically the same data this week. At the end of last year just all of a sudden the number of mobile apps like quintipled. Wow.

At the end of last year because of vibe coding and it's just starting and so the very bottom of the market if the three of us want to get together and build an app for real. Uh we can do it now. It's very exciting.

Um and Salesforce isn't going away but that middle is going to be harder. It it is it's it's a good point. Um and uh there's just if you really want to build it today, you can. And it's super exciting.

What's going on in PE land? I would hate to be a, you know, private equity firm with a bunch of kind of legacy SAS and you're having to explain to your LPs that no, everything's fine. We're going to, you know, uh, we we took this company private. We'll we'll take them back. It's fine.

Uh, you know, the the Toma Bravos of the world. I'm sure that they're they're very savvy. Uh, how do you think, uh, they're kind of thinking right now? How how intense is is the fear? Where is it sort of unwarranted? Well, there's one thing I I I know for for sure, like for a thousand% sure, and this is slightly inconsistent with the data Carta and others put out and others on the on the internets. Um, these B2B companies, PreI ones at 50 million, 100 million, 200 million, 800 million, no one wants to buy them. It doesn't matter you, Hooray, you got profitable. Thank you. That means you're not you're not going bankrupt. You have not solved your existential problem in the AI. I mean literally I I'm an adviser a friend to a to a company about 140 million in revenue. pretty good growth but not AI growth but but pretty good right

and we were doing a review yes the other day on M&A and I was shocked with the folks on the block

that would sell folks much bigger than that much bigger than 140 million any exit they can get so to sell any exit any no P4 they've already gone to Tommo Bravo and Vista and Insight they ain't going to 140 million AR for a weird crammed down combo exit unless everybody else in the PE chain said no right um It's rough out there. And I, you know, until even late 2023, you got to 20 million in revenue. You were still growing and you were and you were efficient. Someone was going to buy you. And the question was, was it 5x, 6x or 10x? Um, and that playbook died for PE and it died for exits. So, I do think the Tomo Bravo will be they will figure out how to accelerate AI in their portfolio and go deep and it will work. Um, I really believe if you can own the agents on your platform, that's how you reacelerate. You have to own the agents on your platform or the agents will take away all the value. But man, there the PE has just said goodbye to B2B and it it's it's terrible. I don't mean to be so draconian in 2026, but I talked to so many founders that are in La La Land and I think it was okay last year, but um uh at least some point you just just be honest that you know P is not coming to the rescue unfortunately for 95. I mean, everyone's on the block, guys.

PE it's more of a Grim Reaper scenario typically.

Yeah.

On the other hand, it's just so exciting

to be building things today.

Sure.

Right. And and and there's either a malaise in these companies because they're building nothing or you turn around and you can't believe what they built last week.

Yeah.

Right. I mean, Ramp's your big sponsor, right? Even just look even though Ramp is old, look at the pace at which they put out software now. Like, it's crazy,

right? And any is going to die. It's just catastrophy.

Do you uh do you ever go around to your portfolio and say like, "Hey guys, like why am I using agent force?"

Like why is this like like nothing again nothing against Salesforce but like I was surprised to hear you're trying everything using everything building your own agents and yet you're sitting here saying like yeah we're running everything on agent force and it's great.

Well we run we well actually and this is a risk for everyone it for the moment you can be promiscuous with agents. So we are running four different sales agents. We're running Agent Force. We're running a hot YC company called Artisan. We're running a company called Qualified that Salesforce just bought for almost a billion to get more reach. And then we're running a and then we're running a bit of clay which just raised at 5 billion. So we're actually running them all. Uh we're we're it's work. We're running them for different use cases. Um and that's actually good for startups because they in the short term they get more customers, but overall it's hard at the moment to dominate. Um, so, uh, it's not just Agent Force. Um, and I think that's the risk that is that is the risk that I think Agent Force is going to work. I can tell you why as someone who's actually using it, not Sony baloney. But we we're using four vendors instead of one.

Yeah. Can you give more

instead of one? There's risk as well as opportunity, right?

Can you give more concrete examples of how you're using Agent Force, what it's doing for you? Is it sending emails? Is it drafting emails? What?

Yeah, that's all it's doing is sending and drafting emails. We gave it the use case um which is is a good one and which is the one Mark talked about in the early days. We gave it reactivations.

Okay.

So and and this will resonate a little bit with you guys. Folks that used to be sponsors or used to come to our events. This is very simple and atomic

that a human being was too lazy or unwilling to follow up with.

Mhm.

And um but they were good ones. So we scored them and sent them out and we got 70% open rate.

Wow. That's great.

It's pretty powerful. This is something when we had eight people on our sales team. Now we have one in AIS. We went from eight to one in AIS where it just wasn't worth the humans time. It just wasn't worth and Jord's time because they're hunting the big deals at Vanta and Ramp. They don't want to hunt the little deals or or there was turnover at Brex and they don't know how to meet P the new Pedro's gone and they know so the humans give up but the agent doesn't quit.

Sure. Yeah.

Agent just looks up who replaced the person at RAMP or Brex. They follow up with them. They have no shame. Um, and we had an agent that closed a 100k deal on Saturday night. I mean, let's be honest. How many want to close a deal? Yeah, for real. But for real, how many humans want to do that?

What will wait for the e- sign document to come back? But how many of them are going to do the work on Saturday night? They're streaming, right?

Yeah. What about uh do you think we'll see any uh are you excited about any turnarounds, public market companies that have been, you know, completely beaten up? I mean, we just had Jim on from Yahoo, and that's a business that people don't, you know, aren't talking about. Certainly the tech media isn't spending a ton of time talking about Yahoo. But he's sitting there being like growth is great. We've got hundreds of millions of users. We have all these opportunities to put AI in across the the ecosystem. Uh and you and and you have to imagine there's a bunch of uh companies that have been beaten up in the public markets that u maybe founders, you know, people just want to start something new. They don't want to try to deal with with uh legacy platform. But I'm sure you've been pitched random ideas like that. Well, look, there's there's there's um there's a bull and a bear case here, right? And um the the the the bull case is um AI is so early and especially in real enterprises, not not all the tech folks buying these products on a circular basis. Everything's circular, right? Including GPU sales and everything's circular. If you go out and talk to the real world and bring folks from Archer, Daniel, Midlands, and whomever on the show, they're going to tell you they're it's early. They're experimenting. And I think that is going to benefit Salesforce and service. Now, it's not too late for them at all, right? Um the there's a lot of stress at those companies today, but it's not too late. Um the flip side though, I got to tell you, now that we're in 2026,

you've had time.

Where's the turn? Like, hooray that AI can do all these things at Yahoo, but it's already like it's already utterly changed video and audio and everything. Why? Why? Show me the money. Show me the lift in revenue. And I have lost patience with founders at 1 million 10 million public companies that have not seen the lift because great but 11 labs just crossed 350 million.

Yeah.

Show show me the money. Like enough talk and enough armwaving and you know you you AI doesn't count if the revenue doesn't grow. It's the problem is here's the tough part for everyone including a Yahoo and most startups. Um it's it's hard enough just to keep up.

It's hard enough just to ship an agent. It's hard enough just to achieve par, figure out the guardrails, figure out how to make this product work. And then the other guys have pulled ahead. Like it's just you're almost bailing out a leaky bucket. And so, uh, I know we want to be optimistic that there's so much agentic opportunity, but I'm at the point you got to show me the money.

Mhm.

I don't need to see you go from and look what happened like [ __ ] like dramatically reacelerated.

Yeah. Yeah.

In the age of AI, we're I'm not looking for you to go from [ __ ] from like down to like the teens to the 30s or whatever they did. I'm just looking for a little bit of game.

Yeah. Yeah.

What about uh how are you thinking about AI uh AI discoverability? Are you paying a lot of attention to this with your business? Uh are

you

find vendors we need to get business?

Well, yeah. Yeah. Just like how you're showing up in in LLM queries, all that stuff. Do you think it's uh are you advising portfolio companies that they need to pay a lot of attention there?

GEO broadly?

Yeah.

I think people are underestimating this. Mhm.

I think GEO is is it's almost a disservice.

Um you don't just want to show up randomly in what's a next generation media company focused on tech and it says leaders include folks like TBPN and and the others. That's not like you got that's nice. What you really want to show up for

like um I I'll give you a very example. I I did this as a use case yesterday. I went into Replet and I said what's the best CRM for me to use? And it said HubSpot. That's where the money is today.

Yeah, totally.

Us asking all the agents we work with, whether they're Claude or ChatgBT or or if we're building something in lovable or replet. We're we're not, you know, we're not going to go to Google. We're just going to ask the agent, what should I use?

Or you won't even ask the agent. You'll just say, I need a website and it will be like, well, I need to pick a database and I'm picking this database. And you don't even know what database it picked. And

that's that that's an issue. But I think like software isn't dead. I mean, the public the leading public B2B companies are doing two trillion. Totally.

But when people do discovery, they're going to ask their agent and and I even built a digital JSON. It's been used 175,000 times. People just ask, "What should I use?"

That's correct.

Why would you go to Google and pay even even you might use the AI summaries if they answer the question, but we're not discovering

with a sales rep that doesn't know the product, right? And endless webinars like that stuff. It just just ask figure out what is the most trusted agent for what you do and ask them what to buy. And you know what? You should just buy that product.

Yep. Where should I I've got 500k to sponsor this year. I want to reach tech leaders. I want to do it on media. I want it to be persistent. What's the best place to do a 500k sponsorship? And if it says TBPN, I should just like let me not waste my time. I'll do one more call, but if you guys will take my money, I got to move on.

Yeah. Yeah. The other the other dynamic is just agents selecting different vendors themselves. That's a whole that's a whole another level of it which uh I don't think uh enough people are kind of even caught up to yet which is like if I just have agents running parallel and they're and and you you can assume if your agents are closing deals now on a Saturday maybe you start to give them a little budget not too long in the near future and they're starting to actually you know spend money on behalf of the company too and just make certain vendor decisions and you trust them because hey you're you're doing great work.

Yeah. Yeah, I don't know the big examples, but there are startups that have blown up in the last 12 months like resend instead of send grid for email, works um and others where the the agent just said to use them.

Yeah.

Like I use resend instead of send grid. I couldn't get Send Grid to work in Replet. I just couldn't get it to work. I could tell you and you know the reason why the founders are long gone and they decided to to throttle the free account so much that they don't work. Like you just can't get a free account working, right?

And so I asked agent, "What can I do? I'm banging my head against the desk. They said, "Use resend." I'm like, "Yeah, that guy seemed cool. I used I've never gone back."

Wow.

Right.

That's remarkable.

And work OS was around for years trying to do OOTH, like authentication for apps. A good solid CEO, good solid technology, but went through layoffs, was kind of going nowhere,

and then everyone just started to use it. Every agent recommends it. Everyone just blows up. So, I, you know, that's not yet, that part's not yet in mainstream America. Um, that's pretty nerdy, but some version of this is how we're gonna going to pick agents. And so, I think Gio is nice, but some of it scammy and smarmy. Um, and uh, I'll tell you how I know what, in my opinion, when a an agent is scammy or smarmy is when I have to put in a credit card before I can use it.

Oh,

I don't like that today. So, all these geo tools are trying to get you to pay 5.99, $8.99 before. Just let me try the thing for a week.

Sure. Sure. Sure. Yeah. Sounds pretty sure.

If it works, I'll pay you.

Yeah. Yeah. Yeah. Yeah. Uh yeah, I mean obviously you you've talked a lot about how competitive uh you know these vibecoded products are the early tech markets. Are you optimistic or getting more interested in the more niche uh far field businesses where maybe there aren't really software solutions? You know, maybe you put Harvey in this bucket and some of the medical stuff, but also like hard tech. There's a whole bunch of like pieces of the economy that have not really been touched by software yet. And maybe AI is the thing that makes it now we can go do something on the farm that's actually impactful or do something in oil and gas or do something in in fishing or some really far out piece of the economy where there isn't an established conf.

Yeah, we had the founder on the other day that's doing super intelligence for dairy farms. So like he has a product you just walk up if you're working on a farm you walk up to the computer you say what should I do today and it just gives you a bunch of tasks.

It's a good market. I almost did a dairy farm investment years ago that was using

what do you what do you call it visual AI to optimize farm yields right it's a and there's there's a couple larger companies in it the interest I'll tell you I can give you a couple answers here's what I'm thinking of more in terms of the one should will a lot of flowers blossom here yes like we will see more and more of this niche software it is great

to make money from it investing here's what I'm looking at is

is the agent however the heck you built it. Is the agent so powerful, so ROI positive that you can charge four to five to 10 times more in this category than you could before. That's where the math compounds to something interesting. So, it's one thing if you can just track the the yield for the cattle a little bit better than the prior. Like, that's great. But if it's the same unit economics as the deals I looked at four or five years ago, I'm out because even getting to 100 million is tough, right? But let me give you a contrasting example on these AI SDRs that people we use a lot and people used to make fun of them, right? But these these startups like Artisan and Qualified and Clay, they're expensive, man. They're like a hundred grand to start.

Wow.

Okay. And let's go look at older when you back in the day, I was one of the first investors in Salesoft, which was the last exit of the last generation. Okay. December 2021, 2 and a half billion to Vista. And then last it was [laughter]

Yeah. A funny story. the CEO was like, "We got to sell." And the VCs didn't want it. Like, "We're going to be worth much more than two and a half billion." But the CEO, Kyle's like, "No, the world's changing, man." Um, [laughter]

wow.

But getting getting folks to pay $100,000 for those apps was hard, right? But today, it's just it's table stakes for the next generation version of these apps. So, when you start to see an app that used to struggle to get 10 grand a year for it, get 100 grand. I'm all in on dairy or niche uh you know, um hydroponics or you know, pool cleaner apps that are all really cool. It's just that the numbers didn't I I'm I'm an investor in a company called Mango Mint, which is [snorts]

in a pretty crappy category. It's it's software for spa spas and salons and doctor's offices.

The Why is it crappy? It's midsized and there's like 10 really good companies. M okay if

there's just one

yeah it'd be fine but

it' be fine

hyper competitive still

you know after 30 million they just blew up with everything they're doing that is agentic and automation related because it's much more val but not because it makes the product much more valuable

yeah charge more

yeah so I want show I'm sorry but show me the money if you had a software that was $8,000 a year before and now you can charge 80 because honestly you got rid of 10 people in the back office

that's What's happening? You're getting rid of a lot of people.

Yeah. The other thing when people when people are like, "Oh, this agent's like super expensive to run and like could I People are like, I could just get a normal person at this point." It's like, well, the point is that you have potentially an expert that can work around the clock that you can turn on and off in real time in a way that you just can't. It's like, why is a why is a consultant end up charging, you know, an obscene hourly rate? It's because you're just tapping them in for, you know, a quick sprint here or or a project or a couple months, etc. So, you got a premium

when someone says that that that's dumb. Like, because honestly, if you can if you could maybe at TBN you're pretty hot. It's easy to hire. I've never found hiring easy. No matter how hot I've been at any startup or anything, it's always hard to find good people. If you can magically wave your wand and get 10 great people uh for for low wages to do the job you want, yeah, don't hire an AI,

right? But they're going to quit. There's a tax to hiring them. There's attacks to onboarding them. They don't all perform. You got to train them. You got to manage them. I mean good good good luck good luck we are uh it's harder to hire anybody

it's also it's also more is I mean from our our point of view we we had to we went from you know basically three to three to 10ish last year so not not not crazy growth right we're a small business

uh but uh we actually like the size of the team right now like I like that we're all hanging out here in the studio all day long I don't want to add a lot of people I don't want to be a manager I don't like managing people I like working with people that are great. I don't like being a manager. And so, if we can limit if we can keep headcount low and and uh uh stay small, that's that's amazing.

Well, that's why we shrunk to three.

I couldn't do it anymore. You criticized me. Like, take your shot at me, right? But I've been doing it a little longer than you guys. I just couldn't take one more person paying them six figures, quitting

and for a worse job. I couldn't take one more person getting to work from home with high autonomy, setting their own goals, no no drama, paying them hundreds of thousands of dollars and and just saying, "I want more." I just couldn't couldn't take it. And so

last June, Ameilia and I run SAS. We're like, we're going to get we're going to go so far on agents and we're going to break every agent. We're going to push it to the limit.

And so now we have, you know, two three people doing the work of 15 and replace two agencies with with apps we built ourselves. We just couldn't take it.

Wow. Uh, real quick, real quick. IPO, IPO market. Uh, you think, uh, looks like OpenAI will beat Anthropic out the door. Looks like SpaceX

could do some type of deal, beat, uh, OpenAI out the door, a nice spite IPO. Uh, how how much do you think?

How much do you think kind of the ordering of these IPOs really matters? like is is it uh could Elon successfully suck uh some real oxygen out of the room and make things more difficult for his uh for the other labs?

Um well look I I think I in my limited experience and I think some of this is a media creation to for something to talk about. Um these all these companies are so exciting at a retail level and at an institutional level. there is infinite demand in the private markets and there will be sufficient demand in the public markets to go public. So some of this is is a media creation. Um certainly though um the IPO markets are are wide open but uh they're they're they're discriminatory. I mean Wealthfront bombed.

Equipment share crushed it. Wealthfront bombed. You got you got why did I mean equipment shares at what four and a half billion growing almost 50%. That's a pretty high bar. Okay. So, it's openish. [laughter]

Openish.

So, there there's something to be said when the markets are good but not perfect to being the first out when demand has not been satiated walking around and maybe not everybody wants to do all three,

right? And maybe and maybe and maybe it's tough if if you're worse but still great than the other ones. There is, you know, probably whatever XAI, SpaceX, especially if it's not SpaceX standalone because SpaceX standalone with Starlink's a great IPO, right? But if you start mashing loss leading stuff in it, there's something to be said for maybe Anthropic will look better. So going first.

Um but um but we're entering an era of just utter wealth creation from IPOs like we have never seen. Like it's just we're underestimating, you know, it used to be a billion. You know, a billion a unicorn used to be great.

Yeah. Now it's a trillion.

Then 10 billion used to be great. Now now you go on TBN, we're all talking about a trillion dollar exits like like it's, you know, like it's snacks and popcorn and in a show and and it is. But think about how many more, you know, there's 20,000 folks at Nvidia that have made 20 million or more in the Bay Area and it's just going to explode and we're going to enter this weird world where the best VCs are going to make money like we've never seen before, right? And the best engineers and then, you know, the middle is going to have no jobs,

right? Well,

that is

Well, Tyler Cton disagrees with you. He thinks that the economy will

No, he did he did say you might have to move to to Houston and take a job in the energy sector. So

that's a good it's good advice or don't quit. But I I will tell you one last thing. I was with this week I was at an event with a lot of sea level B2B executives. Um it was just a favor but I've gone every year for a while to just and and this was the year they finally been like we can't find any jobs.

H

they're just people just don't need these. I won't say exactly which level they were thing but like finally set in that like I just they just no no one needs folks with these 2021 through 2024 tech tool skill sets. they just don't need them. And it's um yeah, go to Houston. Like do it. But whatever you do, don't quit your job. Like if you like it at TBPN or Yahoo or Cisco, my advice is stay. [laughter]

Yeah. Yeah. Yeah. That makes a lot of sense.

Well, so so great to finally have you on the show. Let's do it again uh very soon.

You guys are the best.

We'll talk a pleasure. Thanks.

Goodbye.

Labelbox, reinforcement learning environments, voice, robotics, evals, and expert human data. Labelbox is the data factory behind the world's leading AI teams. I I have I've probably listened to so many different podcasts that Jason's been on over the last 10 years. It's always always weird to then have

him on and be hearing his voice on our show. It's very cool.