Eric Newcomer on building a media business with scoops, events, and subscriptions — and why AI can't replace journalists with real networks

Speaker 2: We have Eric Newcomer from Newcomer. He's the founder and writer. Welcome to the show. How are you doing there?

Speaker 6: Finally.

Speaker 2: Finally. I'm so sorry. First apologies. It's been way too long. You know I've been This

Speaker 1: should have been This

Speaker 5: should have

Speaker 2: been I'm not kidding. I've I've listened to every episode and you've been on an absolute terror and I'm sorry that we went back and forth. We both barely live in in or in Twitter d m's and so every our our chats are just like, yeah, let's do it. And then like five days later, oh, sorry, dropped it. Oh, sorry, I dropped it. But anyway, I'm glad you're here. How are doing?

Speaker 5: Here here we are. You know, I tweeted, this is a big moment for me. I'm glad. Literally, I'm having Ben Smith recording my podcast tomorrow. So couldn't have been a better

Speaker 2: You can get to the bottom of

Speaker 5: I've even dug into this. So it's like you're giving me notes

Speaker 1: Materials. Yes.

Speaker 5: To ask him about it.

Speaker 2: You gotta ask him the hard questions. What happened with the minor scoop around?

Speaker 1: I You have the landscape. I I really we were saying it when the show kicked off.

Speaker 2: Generational run.

Speaker 1: Generational run with Generational run. And and I when I listen to your show, I I'm like taking notes. Because like you you actually have a really I was calling you like Matador. Oh, yeah. You're with like you're with like a bull and you're trying to get them to like kinda run at you but then they run at you and then and you sidestep.

Speaker 2: It's really good.

Speaker 1: It's really good.

Speaker 2: And And it's just I I don't know. It's very kind.

Speaker 7: Do you

Speaker 2: feel like you op you occupy like an interesting space? Because I feel like you're not some like tech optimist pumper insider. Right? Like you have, you know, what, six years in Bloomberg serious journalistic chops. But then you interact with people who come at you with, like, crazy anti tech takes and you're able to sort of, like, play the pro tech guy in some ways. It's very confusing sometimes.

Speaker 5: You know, I I'm someone who came up through journalism.

Speaker 2: You know?

Speaker 5: I was working the last guy in through the normal, like, I was in my hometown paper, the Macon Telegraph, Sun Sentinel, Tampa Bay Times, New York Times, like interning my way up, just doing the journalism thing. Thank God Jessica Lesson brought me to work for the information. I was first employee. So I was like, oh No way. Silicon Valley thing. Very interesting. Yeah. Yeah. And so I was working out of her, like, apartment in Dolores Park. Cool. And then I, yeah, worked at Bloomberg for six years. Yeah. And, you know, started to really get Silicon Valley. And so when I launched Newcomer, I did write that I wanted contrarian optimism. You know, I I felt like I started my time as a tech reporter being more negative than most because that was the era of Sure. You know, sort of the gadget blogger. And then by the end of my time at Bloomberg, we had sort of the infiltration of, you know, the political reporter who was really gunning for Yeah. Facebook or whatever. And so it went from everybody's too soft to everyone's too negative. And I really just wanted to write for, like, your audience, you know, people in Silicon Valley, people who got it, didn't wanna have to explain who Marc Andreessen and Ben, you know Yeah. Yeah. And Bill Gurley were and just sort of write for the people. And sometimes that's positive, sometimes that's negative. Puts me in a sort of weird situation sometimes.

Speaker 2: So I I feel like I'm also having trouble putting you in a bucket as like commentary interviewer, scoop master, scoop athlete. You get some scoops but it's not the only thing that you do. Like we talk to a lot of people who are just great yappers and they've never gotten a scoop and that's fine. And they have great commentary and they can talk about anything that's amazing. And then there's other people who are just great interviewers and they every week they're delivering like a best guest. And then there's other people who are the scoop athletes and you never really hear them give a take or their opinion but they're like pestering everyone in signal all day long I suppose. But is that by design? Is that something you see like fragmenting over time as you build the organization? Like what is there a method to the madness or is it just like you enjoy all three things so you bit down

Speaker 5: you know, you do best what you enjoy. Never heard anyone call me an athlete before a Scoop athlete.

Speaker 2: The Scoop doggy dog. I think

Speaker 5: Scoop you know, we're essential reading. Think the best takes are ones where, you know, you go talk to people who know and then you're

Speaker 2: like Yeah. It's not just like

Speaker 5: I made this up. It's like, yeah, I talk to people. It's gonna be the right. You know, I want my predictions

Speaker 2: Yeah.

Speaker 5: To come true. I think the best coverage, you know, doesn't just sit down smart today. You know, you look back and you're like, oh, we saying Google was undervalued when stock, you know, wasn't getting the credit. You know, you wanna feel like we were right. Like, look back and read the record and that's how you build a

Speaker 1: record financial advice?

Speaker 5: I want people to make money. I wanted to I was not, you know that's not the goal, but I want people to read it and they make more money and so it feels like it's worth subscribing. But yeah, we do we do whatever we want, you know. Yeah. Newcomer, it's from in a

Speaker 2: the content Yeah. From a personality driven, but you do have other folks on staff. And then diversity of revenue streams, right? Ads, subscriptions, and events. Like was that deliberate on day one? I feel like a lot of people focus like don't know. It's interesting. It's worked, but it's like it feels contrarian in the new media sense because most people just be like, oh, I want to be like Ben Thompson only subscriptions or TBPN's only ads or someone's like really in the conference business or they do that like way later. It feels like you were able to land three planes simultaneously pretty quickly.

Speaker 5: Yeah. I I mean, today, event sponsorship is our main revenue stream with newsletter subscriptions being our second Mhmm. Largest. I mean, I did the Substack thing

Speaker 2: Yeah.

Speaker 5: In 2020 in the pandemic, and it was like, this seems like fun. Finally, something in startup world applies to me. I'll jump on that. And I was one of the top tech Substacks. 2023, I had not jumped on crypto. Right? Like, I'm sort of a crypto hater. But 2023, I'm like, I don't know, chattybt, this seems real. You know? This is actually the tech trend that people have been waiting for, not something that was, like, getting ginned up. So I had access to a beautiful office in Hayes Valley, my friends. Now their company is Weekend. We put on the first Cerebral Valley AI Summit. It was just sort like this worked. People were enthusiastic. You know, Ali Goodsey connected with Naveen Rao and Mosaic ML acquired the company for $1,300,000,000. You don't get better press than that,

Speaker 2: you know? Yeah.

Speaker 5: Business Insider put in a beautiful headline, you know. Yeah. And so we were off to the races. We're literally doing our mid year Cerebral Valley AI Summit in London

Speaker 2: Yeah.

Speaker 5: Next week. So ramping up for that. So, it's events, subscriptions, trying to I'm out I'm out hustling trying to follow your sponsorship playbook. So if you want to put in a good word for people, the newcomer all around, like I'd

Speaker 2: love it. I mean, the the the or the pre roll or the mid roll host red ad in your podcast I think would do very well. And I and I I mean I I I like that it there's no ads when you're sparring with somebody. But you did have the mic drop at the end of the at the end of the Ed Zitrin episode, which I very much enjoyed. And, yeah, if you'd snuck it out in there, would have been like, you earned it, you know? Would have been good. Yeah. Anyway, talk about about how you're thinking about covering some of the big stories right now. Like, SpaceX is is dominating the news, but it's an interesting company to cover because Elon's like one of the first like go direct CEOs. He doesn't do a lot of like management interviews. You you don't really like do interviews with other people. Like we have somebody from we we have a VP of Agenic AI from AWS coming on the show. They're happy to talk up and down the stack. You don't get that access at SpaceX necessarily. How do you think about what your audience wants to hear from you on SpaceX?

Speaker 5: I mean, yeah. They control their own social media network. Yeah. They can publish directly.

Speaker 2: What do they mean? Apparently, they're not doing SEC filings or something. Do you see this? They're not doing conference calls? Yeah. Just doing on X. But those are putting on X. It's hilarious.

Speaker 5: I mean, for the most part, the newsletter really covers, you know, earlier stage startups. On our sort of Friday is like a step back and so we cover SpaceX a lot there. I mean, all this money is about to flow into Silicon Valley. So just everybody getting rich and that being great for the startup ecosystem is definitely one theme, and who's getting rich and who got in early

Speaker 2: Sure.

Speaker 5: Is certainly important to us. And then, we can't help ourselves but say this is like madness. I feel like even people buying the shares

Speaker 2: Oh, yeah.

Speaker 5: You know, know that it's sort of a part psychological stock where it's like, well, are is there other money that's gonna come in that's gonna boost this thing up? And it, you know, as someone who's fairly bullish on Anthropic

Speaker 2: Yeah.

Speaker 5: And OpenAI to some degree, like, SpaceX just feels like total lunacy given the sort of insane TAM story that you have to believe.

Speaker 1: So Yeah.

Speaker 5: Yeah. You're getting some of our commentary that it feels it feels somewhat ludicrous but trying to root it

Speaker 2: in Yeah.

Speaker 5: The s one and just keeping it in the numbers

Speaker 2: these seems valuable.

Speaker 1: Reporting on where where the SpaceX employees are gonna be doing their, you know, upcoming purchasing activity. Homes. There's like There's variety. Get ahead of No. There's like there's there's there's like a variety of like communities where

Speaker 2: Are you gonna say the one you're thinking of?

Speaker 3: If you

Speaker 1: look at them, there's only a few homes listed. And I'm like, I know like I I was There's like a There's a car club. This this this Oh, yeah. Race track and it's called Willow Springs. It's an old race track. They're putting a car club there. I I I know for a fact that a bunch of them are signing up I'm a little bit I'm a little bit nervous that there's that share too many interests with the SpaceX

Speaker 5: Oh, yeah. Being priced

Speaker 2: out, buddies.

Speaker 1: Yeah. Yeah. One one less, I guess, serious question. Do you think mocking VC should be illegal? Because there's been a little bit of a of a some drama on the timeline.

Speaker 2: Or do you think in in in if you take if you major in venture capital in college, they should teach you about the Streisand effect. Yeah. Yeah. Yeah. Might be another one.

Speaker 1: No. But there's been some drama on the timeline this week with with VC Braggs and I'm just I'm wondering, you know, Silicon Valley has a lot of power in Washington right now and I'm wondering if now is the time to push to make it just straight up illegal to

Speaker 5: And end the scourge, like it's it's just Yeah. You know, I You know, we tweak we tweak venture capitalists. I get venture capitalists. Guess I'm humoralist list humoralist on this. Yeah. I don't know. I VC always needs to be better at taking taking criticism. Sometimes you're up. Sometimes you're down. It's like better to be in the mix. Yeah. Yeah. In some ways, the SaaS, you know, gets helps you clean up your message a little bit. So I'm I'm always Oh.

Speaker 2: I enjoy that. Sorry. S a s s not s a a s. Yes. It's like SaaS. I I mean that that that does get to something else which is like do you are do you get AI fatigue like we do sometimes where we're like, oh. Like the Snap Spectacles thing we spent twenty minutes on at the top of the show. And like is it the most consequential story, consequential is technology? It's an $8,000,000,000 company. It's a new consumer product. But it's something that's like tangible that at least you can like dig into. How do you balance like what is tangible and interesting to the reader with where the market cap is actually moving, which might be at the Frontier Labs or the Databricks of the world that's a little more abstract?

Speaker 5: I feel so lucky to cover venture capital because you get to cover interesting stuff. That makes a lot of money. Right? Yeah.

Speaker 2: Like, I could

Speaker 5: I could write about oil and gas and it's like you'd fall to dollars, but it's like super boring.

Speaker 1: So Yeah.

Speaker 5: To me, venture's already pretty exciting. Like, writing about AI, you get to talk about

Speaker 2: Yeah.

Speaker 5: Artificial general intelligence Yeah. And like, whether it's sentient. And these have like it has real like business consequences. So I don't really get tired of the AI story. I mean, certainly, AI is dominating, you know, basically all the investment activities. So it becomes a huge focus of ours. So, no, I'm less likely to get dragged into the Snap Spectacle stuff. I mean, it's always fun to watch for new hardware, but just this this question of, you know, are workers getting totally disrupted? Will, you know, change the course of American business? We have these enormous IPOs. Mhmm. So it's one of the more enjoyable times to be a business reporter where the stuff you wanna write about, which is a new intelligence being birthed by Silicon Valley matches, you know, the market caps and what's interesting. And so following the money for the most part has been, you know, a super gratifying story. And so we tend we tend to stay pretty focused on that.

Speaker 2: How are you answering that question of, like, job displacement? Obviously, there's, like, economic numbers. There's also just sort of reverting back to, your own personal experience. Like, are you seeing competition on Substack from, like, slop farms?

Speaker 5: Definitely. Yeah. I think Tim Ferriss

Speaker 2: just wrote about this.

Speaker 5: There's at least one guy clearly ranked above me who's using AI to write the stuff which is just fascinating.

Speaker 2: And where does that leave like like, have you have you have you grappled with, like, what the response is? Because it feels like the the like, the scoops are very, very protected in this or, like, AI resistant, but maybe, you know, history or breaking down or analyzing or taking a press release that's already out there, synthesizing some data in history, that's maybe a little bit more commoditized. But how are you grappling with it?

Speaker 5: Yeah. I mean, think coming from a perspective, being a person, so transcending just a writing style, but it is literally

Speaker 2: Yeah.

Speaker 5: Someone in a publication is accountable is defensible. But certainly as the sort of writing quality of AI gets better and better, I'm I'm I'm not ruling out the possibility that it's super disruptive. Yeah. Like you said, scoops. I think the sense that, you know, the information is coming from real humans that, like, I'm in the business of knowing what other humans Mhmm. Are thinking is fairly defensible. But, you know, we're using AI to build, you know, like our ticketing platform for our events.

Speaker 2: Sure.

Speaker 5: One one of my reporters was talking about using it just to build his own, like, story tracker. I I think we're trying to be creative. Like, I'm I don't want sort of AI written stuff in our stories, but I do sort of have ex existential questions about, you know, like the fifth sentence in the third paragraph. Yeah. AI puts out a better version than you were gonna spend the time to do. Is it really a disservice to readers that you went in and like punched that up? And I, you know, I think it it's probably good for readers. So it's hard to have this super hard line of all Yeah. Human written stuff because we certainly want it for It's a great copy editor. You know, I pay a human copy editor, but still I run stuff through Claude and it's amazing how much it's catching both, you know, it'll catch like million billion type errors Oh, and obviously all sorts of minor typos. So

Speaker 2: Yeah. I'm imagining that, like, I I I feel no, like, sadness about you never writing the line they declined to comment ever again. Like it is it is fine Right. If that is it can be a Python script. It doesn't even need to be Gen AI. It can just be like an if statement because that line is in so many news articles.

Speaker 5: We can have ones that's like take out all the perfunctory lines of stories that they feel inclined to put, then you can, you know

Speaker 2: I would like that version a lot of When

Speaker 1: you think about disruption for for like a newsletter or media business, however however you wanna describe it, the the only person that I think would actually be able to compete like, you weirdly need, like, a network. You need, like, trust. You need, like, you need there there's so much, like, information that I would say informs your work and and other other journalists that that run similar businesses that's just like not anywhere online. Like it truly only exists in, you know, a small like group chat or or places like that. And so the question is like, I don't think a fully I don't think AI can like actually just like somebody with AI that is able to build up the trust and the network and the kind of understanding of the space. Yeah. That person is like, if they're willing to just use more AI than you and like they don't care about like the slop allegations or whatever, then maybe they have some type of advantage. But I still feel like more than more than ever, there's so much information that that you need to run a great media business that is not anywhere on the Internet. It's not in podcasts. It's not on acts. It's you just have to go actually talk to people.

Speaker 5: We we play nice with Art for Rock. But honestly, it's, you know, people in the industry giving it away for free. Mhmm. You know, the desperation for basically content marketing, meaning that some people do a good job of taking sort of their data and using it to to get attention. Like, you think about, I don't know, ramps AI spend data or something. Yeah. Like, that stuff, you know, used to be sort of the fodder of like a Wall Street Journal type story. And so to some degree, I think everyone being smarter that they need to have actually like great content to get people to pay attention

Speaker 2: Yeah.

Speaker 5: Is is one of the vectors of attack not attack on media, but just competitive.

Speaker 2: Yeah. Like, walk me through the the ramp AI spend is like an example of like going direct in the sense that they publish themselves, they tweet about it, they go on podcasts about it. The ADP jobs data just gets released on a newswire and then contextualized by the Wall Street Journal. But if ADP all of a sudden hired some really charismatic employee to go on podcasts, that would be like the same effect

Speaker 5: the old way of doing it would be you try to embargo it to Sure. A couple outlets Uh-huh.

Speaker 1: And so

Speaker 5: they felt like they were really getting something. So then their readers feel that this is a differentiated thing that they're receiving incrementally more reason to subscribe to that publication. So so it it used to be a dance that you'd basically be giving Mhmm. The media sort of favor and sort of unique access Mhmm. That that we sort of lose over time.

Speaker 2: I have a question.

Speaker 1: Do you, ten years from now, would you Can you imagine having, you know, ten, twenty journalists 10, on staff joining joining forces, you know, sort of rebundling? Or do you like being unbundled?

Speaker 5: I I mean, you know, I have, you know, Madeleine Renbarger, Tom Doton, Jonathan Weber writing for me now and they're sort of a core part of what Newcomer is today. And certainly, you know, with unlimited resources, part of what I wanna spend the money on is great journalism, It's good sort of It's amazing that, you know, most cynically, like, our content marketing for events is profitable, generates subscription revenue, people demonstrate real value, you know. It's like you The the journalism provides of a great way to remind people about the amazing events we're putting on. And so I think it's super synergistic. So yeah, I'd love to keep building up a newsroom, but I don't really believe in a sort of re bundling of SubStax. Like part of it we're all building separate brands, you know. Newcomer has its own brand proposition. And a lot of the other sub stacks people like just are sort of, you know, I love reason. Lenny is like crushing it. Right? But Yeah. It's a very different thing focused on product managers. And so if you even look at tech and business sub stacks, we're so different that I've never really been a believer that there's gonna be a rebundling in that sense. But some publications like the Free Press or the Ankler Yeah. Myself get to a level of scale where we become start to look more like publications.

Speaker 2: Yeah. It certainly didn't really happen on YouTube. Like, there are a whole bunch of different creators and MrBeast has a whole team and offshoot channels, but with the MrBeast brand and the promise and the editing and but but they it was never like, oh, MrBeast is roll up other creators because that's not the way the the setup has worked. Talk to me about Mafia. I think we agree It's not. That we don't need other venture capital firms with game shows but

Speaker 5: Don't copy copy TBPN and do a new thing. Yes.

Speaker 2: Exactly. And and I I love that for that reason. But do we need a game show with just journalist competitors? Like an American Ninja Warrior with just sub stackers. What do you think about that pitch?

Speaker 1: Or Nitro Circus.

Speaker 2: Nitro Circus would be good.

Speaker 5: I'm not building my business around it. I'm happy to go on.

Speaker 2: You you participate?

Speaker 5: As yeah. Yeah. Sign me up. But as you guys know, the challenge of media is sustaining it. Right? Sure. Like, I mean and kudos Yeah. To Mike Solano at Pirate Wires. Obviously, he's delivering day in and day out. He gets it. But I do think for like show concepts, it's fun to get excited about the idea. Yeah. But the business is in the long term, like, there variety? Do you have something great day in and day out? So some of these things, it's like, yeah, when you have, you know, the top people you'd want for a mafia show, it's exciting. But is there like fifth episode with you know the c tier founders is much of a sort of much watch must watch on

Speaker 2: on But that's what's interesting about mafia is that it's not a new company. It's not an enterprise that needs to sustain. It can be just

Speaker 5: A fun thing.

Speaker 2: A fun thing that goes as long as it needs to. It doesn't overstay its welcome because it's not this self provide because they have 60,000,000,000 in SpaceX coming to to to hire some camera crews that they need. You know Right. Like that that that is the nature of like I'm I'm I'm I

Speaker 5: haven't watched I I have not watched the full thing. Tom Doton on my team wrote wrote the piece.

Speaker 2: Yeah.

Speaker 5: But I do think, you know, the traders is so exaggerated and there's a reason for it. I still I I'm not saying that I could host it that way but there is a reason that Hollywood and the TV business is so exaggerated.

Speaker 2: Yep.

Speaker 5: And I I think they still need to up it e even more, the the the sort of drama of it.

Speaker 2: Yeah. Yeah. I I saw some people like chirping at the fact like it only had a 100,000 views on YouTube and I'm like that is insane for tech. Yeah. Insane. Totally the greatest. And and like like who like like the the the the guests like who knows There's these only a couple.

Speaker 5: Couple in tech world

Speaker 2: right now. There's only like a couple thousand founders that matter to a top tier venture capital firm. There's only a couple founders that couple thousand founders that even know who these people are. Of course, like, some of the contestants were bigger names, but but by and large, these are insiders around the table.

Speaker 5: It worked for Chase Gunners Fund's money, but now that Trey is great. Yeah. They're in.

Speaker 2: Yeah. Yeah. Maybe.

Speaker 1: How how are you thinking about the evolution of the tier one? It feel the tier one VC. It feels like the tier one the tier one VCs of of, you know, when you started newcomer are not the same the same today. They're they're constantly spicy. This is the

Speaker 5: the question of all questions. I mean, I wanna say first of all, I mean, I I would always I'd put Sequoia, I guess, number one to to answer the question. I think I wrote a piece

Speaker 1: Well, I'm not even telling you I'm not I'm not even telling you like to to give me Name them all? Uh-huh. Name them all. But but you're welcome you're welcome to, but this this will be a scoop for us.

Speaker 2: This will be a scoop for us.

Speaker 5: Who do I think are the top top No.

Speaker 1: No. I I just mean like to me to me there's been a very like a very very material shift and no one has like really said it out loud. Mhmm. Like there hasn't been I think you'd be in a position to actually do this because you have to go talk to the top 100 founders Yeah. Under $10,000,000,000 market cap or below and say like at series a, you basically like make them choose who they would pick Yeah. Every single round.

Speaker 2: You've done this. Right?

Speaker 1: And and there's been there's been some like random there's been some like random kind of like surveys Yeah. And like games that you can play to try to get at it. But like, I think if you actually had it like, you were What was the

Speaker 5: core job? I've seen this idea on Twitter. Like Yeah. And people who is the firm or who where's the real switch? Or who do you think the swaps would be?

Speaker 1: I just I think that there's a very at least when I talk to founders, like, founders wanna work with not necessarily like other founders, as in like a founder who had an IPO, but they wanna work with the founders of the firms. And so there's like a new generation of like, you know, the Thrives and the and the Green Oaks and things like that, where where I see them as like really really

Speaker 5: Probably is dominating. They would Yeah. Were certainly coming up soon on my list.

Speaker 1: Yeah. And like and and, you know, when you get in a situation like hyper competitive like series a, series b, like those guys are like really sharks. Right? And like where do they where do they where do they, you know, fit in?

Speaker 2: The fall off of Arthur Rock, not our fur rock, but the original Arthur Rock needs to be studied. The guy funded Apple, Intel, absolutely insane portfolio, goes out investing with Bernie Madoff. He gets outed for that in 2009. There's a firm that really fell off from the top

Speaker 1: did he just get screwed by Bernie or he was

Speaker 2: He probably got screwed. It's not even that bad but I don't know. Yeah.

Speaker 5: I mean, how much do you think returns are gonna drive this? Right? In the cool venture story, like getting in Anthropic right now or obviously Yeah. Making much money on SpaceX, it's like you look at Spark doing the round that people underestimated. That that's clearly been really good for them. Yeah. I mean, Lightspeed dumped a ton of money. Yeah. And and Menlo, you know, I think it was key key to them. So there are firms where I think it's had a big impact on their reputation, but I don't know if that matches.

Speaker 1: I think that's helpful I think that's helpful with LLP's, but like the reason that it's an interesting question is like, okay, who has the best overall brands? Right? Who has like the most like halo? Who how which which firms do founders actually wanna work with? Right? Who has the most who has like the most access to capital? Like, all these things factor in. Who did like who did the the

Speaker 2: Elo. Like, if you

Speaker 1: Yeah.

Speaker 2: Yeah. Between these two firms, which one are you picking?

Speaker 1: Yeah. Like, people that bet on Anthropic

Speaker 2: But that's completely different thing from actually measuring the quality of the venture capital business that is being built. And people still conflate two different goals. One is the the sexy seed round to multibillion dollar exit in a very short amount of time. Cursor is a great example of, like, it's just classic venture capital. You got in sub 1,000,000,000. You were out at 60 within three years. It's just incredible venture auto. Right? Incredible venture capital. But then but then there's a different game where that investment returns 3,000,000,000 in three years. And then there's a different one where you put 10,000,000,000 in a lab at 500,000,000,000 and it doubled and so you made more money. And in the at the end of the game these venture capital firms are businesses. The job is to return cash flow like to create cash. And so, yeah, oh this fund had to raise more money. That's not really a critique. That's a critique of like what's the definition of venture capital? Should we include growth stage investing in that? Should we include your public business in there? But like as a financier, as an entrepreneur of a financial company, all you care about is how much cash are you returning to your investors and to your GPs. And so there's two very different games that are being played. One is for clout and credibility and the other is just how much raw cash is this business throwing off? What's the value of the firm?

Speaker 1: Yeah. And I look at it like when I when I in the in the most simple view, I think about a a series a or a series b and a founder gets 10 term sheets hypothetically. And then you run that and you ask a, you know, a 100 founders that, like who comes out in the top three. That that to me is like the most interesting because that's like a generally gonna be a leading indicator for like who Sure. Who has the most aura, you know, kind of

Speaker 2: The aura list. The newcomer

Speaker 1: aura list. The newcomer oralist.

Speaker 5: We've done we did Founders Choice a while ago Yeah. Which was these guys.

Speaker 2: Elo.

Speaker 5: Right? That was more like, you know, it was a little more like founder friendly experience. We've published, you know, an LP did a survey of manager. So we we try to there's so many different ways to slice it.

Speaker 2: Yeah.

Speaker 5: And yeah. I I mean, getting great returns, I think it has some impact on, you know, you know, you're heft with founders. Founders like winners, people who are making a bunch of money. But I agree, you can't just look at returns and say those are the ones that are gonna get picked

Speaker 2: by There's also an interesting dynamic particularly with Sequoia where for a long time they had a reputation as being like not particularly founder friendly. I mean, it is the genesis of Founders Fund is like the whole PayPal drama around Sequoia, right? And it's like, what if there was a firm that was founder friendly? And then that went off and happened. And now, obviously, there's an entirely new team there. It's a new strategy. But I talked to founders who are like, yeah, they're not friendly and I'm getting in the gladiatorial arena with them. Like it's a lion and I'm going to ride it. Like and they're excited by that and they're like, yeah, if I don't put up insane returns they're going to fire me. That's encouraging. Like I need that. I need to grind harder. And so there's this weird thing where if you're measuring just on like who will have your back unconditionally, there could be some really terrible venture capitalist out there who's not going to help you but also never going to fire you. And they're just kind of like, yeah, I gave you their dumb money. But so there's a lot more to the shape of like the thing but that adds aura too because like you can be I mean we had Andrew Reed on the show and he said Sequoia won't stab you in the back, we'll stab you in the front. I was like, that is high aura.

Speaker 5: From their lips.

Speaker 2: I and I'm like, I I mean, I'm not in a position to raise my arms to go ahead right now, but like, I was like, I kinda wanna work with Andrew. Like, after that, that's great. Like, I like that. And that is a good good defining line there. Anyway, I don't know.

Speaker 5: Yeah. I think, you know, good founders like tough investors. Yeah. But, yeah. I I agree. You know, competition and capitalism forced all these venture funds to realize that founders were their main customer and Yeah. Therefore they needed to say they were super founder friendly. And, you know, I I think Benchmark's doing a good job with the rebuild but having

Speaker 2: Ship them a thesis.

Speaker 5: Travis and Emile running around being like, hey, screw founders over. Like, I don't

Speaker 2: It's like Ev Randall was drinking beers in college when that happened. Okay? Let's back off of that truck for a little bit. Let's not visit the son or the sins of the father on the son. Right? Is that in the bible? On on this list, I you know, the competing with the Midas list or doing some other list or like how valuable are lists in terms of like actual moving the needle for your business? Like early on at TBPN, we did the the Metas list, which was like a list of AI researchers and it converted a decent amount of email subscribers because we had like an email capture flow. We weren't like directly monetizing it, it was an interesting experience. We did a couple of those like sort of stunts. But I'm interested to know from your perspective, is that is that less of a priority? I always hear that like scoops get people to to to pay. They jump the paywall after a scoop. They got to read it. Whereas an opinion piece might not. Even if it's going viral, people might just summarize it.

Speaker 5: We we did a survey with wing of top venture capitalists Oh, to rank up and coming companies. And that does really well. It's like great marketing for us, you know. Everybody on the list tweets it out. Yep. But we we don't really put much behind a paywall because it's sort of meant to be read. And so then it's not a very good like subscription driver. It's more just like brand building awareness influence. And so so really the challenge of any list is are you gonna put it behind the paywall? And for the most most of the time, you wouldn't Yeah. Because you want it to get shared. And so I think they're good for brand and, like, list building, but not great for subscriptions. Whereas putting, like, documents or behind the paywall, you're gonna get this resource of companies that you might invest in or whatever. You know? Behind a paywall, you know what you're paying for and so people are just much more likely to convert. So, you know, I when that LP I mentioned earlier did a survey about venture firms, you know, we put that behind a paywall. I think that did very well. So if we're willing to put it behind the paywall, they can do well. But for the most part, the list you're talking about, you know, we Yeah. We keep in front of the paywall.

Speaker 2: I feel like there's still I I feel like a lot of people ascribe the the value in the Midas list and what Forbes does to just the fact that it's a list and everyone wants to be on it and it has, like, legacy and brand and that's real. But underrated is how incredible the photography is in a Forbes feature. You can hire a a great photographer and still not hit that level of like magazine covered look. And if you offer that to someone who's going to win the list, if they understand media and the power of like a really high quality photograph and a and a photo that will live on and sort of immortalize them for like maybe a decade, you see a lot of people and their top Google result is still that cover that they did when their company hit unicorn status or something. You're like, wow, they look great there. And then you meet them in person and they're like, oh, was a decade ago. Got some gray hairs now. But but offering that as like a trade is a is a interesting interesting

Speaker 5: had like two photographers running around our last Super Bowl Valley event. So I couldn't agree you more. They like getting great photos of these people out of these events

Speaker 2: different than just the LinkedIn profile photo against the wall. Something that has action, background, texture, like, these things are harder to recreate than people think. They they take it for granted because they show up everywhere, but they're usually because of a special thing. Nothing's higher status than the only thing higher status than the the Midas list is the the Alami stock photo watermark, Getty images watermark at Sun Valley. That is the highest status symbol in Silicon Valley in my opinion. You can't you can't buy it.

Speaker 1: I just have one more question. Are you going to voluntarily switch to API based billing for your AI usage?

Speaker 5: Because because I'm corrupt for Yeah.

Speaker 1: Yeah. Yeah. He said you you said AI was useful. You said

Speaker 2: Call out.

Speaker 5: And Citron has this view that journalists shouldn't be getting monthly subscriptions because they're falsely subsidized and we're under we're not really paying what it costs.

Speaker 2: Sure. We need to be paying $8,000 of cost. Don't think I'm that much

Speaker 5: hyper like, I I think Plaud and OpenAI Yeah. And Robbin and OpenAI are getting a better deal out of me probably than I'm using. I'm not I'm not sure I'm getting this arbitrage.

Speaker 2: Totally. Yeah. You can run those those prompts of, like, estimate the number of tokens that I've used over time. And, like, a lot of people run that and they're like, wow. I've been paying $200 for like $20 worth of tokens like they're off of

Speaker 5: I think I'm getting had. Not the other

Speaker 2: way around right now. Yeah. Is AI useful? We'll figure it out eventually. We'll figure

Speaker 1: it out. Figure it out together.

Speaker 2: Thank you so much for taking the time. This is ton of fun. Let's do it again. Amazing.

Speaker 5: So happy to do it.

Speaker 2: Well, long time we saved we saved this for you know today. It's been really fun. We'll talk to you soon. Have a great rest of your week.

Speaker 1: Later.

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