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Language: en
the person who controls the algorithm
controls the world right and if you are
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Affiliated platforms then whoever
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you the following is a conversation with
Mark cubin a multi-billionaire
businessman investor and star of the
series Shark Tank longtime principal
owner of the Dallas Mavericks and is
someone who is unafraid to get into
frequent battles on X most recently over
topics of Dei wokeism gender and
identity politics with the likes of Elon
Musk and Jordan Peterson this is Alex
Freedman podcast to support it please
check out our sponsors in the
description and now dear friends here's
Mark
cubin you've started many businesses
invested in many businesses heard a lot
of pitches privately and on Shark Tank
so you're the perfect person to ask what
makes a great
entrepreneur somebody who's curious they
want to keep on learning because
business is ever changing it's never
static um somebody who's agile because
as you learn new things and the
environment around you changes you have
to be able to adapt and make the changes
um and somebody who can sell because no
business has ever survived without sales
and as an entrepreneur who's creating in
a company whatever your product or
service is if that's not the most
important thing and you're just dying
and and excited to tell people about it
then you're not going to succeed but
it's also a skill thing how do you sell
what do you mean by selling selling is
just helping I've always looked at it
about putting myself in the shoes of
another person and asking a simple
question can I help this person can my
product help them from the time I was 12
years old selling garbage bags door too
and just asking a simple question do you
use garbage bags do you need garbage
bags well let me save you some time I'll
bring them to your house and drop them
off to you know streaming um why do we
need streaming when we have TV and radio
well you can't get access to your TV and
radio everywhere you go so we kind of
break down Geographic and physical
barriers and you know Cost Plus drugs
you know what's the product that we
actually sell we sell trust um in a
simplistic approach we buy drugs and
sell drugs but we add transparency to it
and bringing transparency to an industry
is is a differentiation and it helps
people trust in an industry that's
highly lacking in trust exactly okay so
what's what's the trick to selling
garbage bags let's go back there 12
years old what I mean is it just your
natural Charisma I guess a good question
to ask are you born with it or can you
develop it oh you can definitely develop
it yeah I mean because selling garbage
bags door to door was easy right because
like 12-year-old Mark going hi my name
is Mark do you use garbage bags you know
what the answer is going to be right can
I just drop them off for you you know
once a week whenever you need them you
just call and I'll bring him down sure
so that was easy but I'm sure you've
been rejected oh yeah of course not
everybody says yes what's your what was
your percentage I don't remember but
it's pretty close to 100% oh okay never
so that's why you don't remember yeah
right because who's going to say no to a
12-year-old kid who's going to save them
time and money but you know typically my
career where I've started companies it's
to do something that other people aren't
doing whether it was connecting PCS and
to local area networks and at micro
Solutions and you know the salesmanship
was walking into a company and just
saying look talk to me and I can help
you improve your productivity and your
profitability is that important to you
and the answer is obviously always yes
and then the question is can I do the
job and can I do it cost effectively and
so you didn't have to be a born
salesperson to be able to ask those
questions but you have to be able to be
willing to put in the time to learn that
business and that's the hardest part I'm
sure there's a skill thing to it too in
like how you solve the puzz
of communicating with a person and
convincing them yeah I mean there's
skill from the perspective that I read
like a maniac then like now you can give
me an example of any type of business
and it'll take me two seconds to figure
out how they make money and how I can
make them more um productive and I think
that's probably my biggest skill being
able to just drill down to what the
actual need is if any and then you know
from there being able to say well if
this is what this company does and this
is what their goal is how can I
introduce something new that they
haven't seen before and is that a
business that I can create and make
money from so figure out how this kind
of business makes money in the present
and then figure out is there a way to
make more money in the future by
introducing a totally new kind of thing
correct and you can just do that with
anything pretty much yeah and you think
you're born with that no I worked at it
because you know going back to what I
said earlier about curiosity you have to
be insanely curious because the world is
always changing my dad used to say we
don't live in the world we were born
into you know which is absolutely true
if you're not a voracious consumer of
information then you're not going to be
able to keep up and no matter what your
sales skills or ability are they're
going to be useless what did you learn
about life from your dad you mentioned
your dad my dad did upholstery on cars
you know got up went to work every
morning at 7:00 came back 5 or 6 7:00
exhausted and I learned to be nice I
learned to be caring I learned to be
accepting just you know qualities that I
think he really tried to pass on to
myself and my two younger brothers were
just be a good human you know and I
think you know he didn't have business
experience so as I got into business he
would just you know say sorry Mark I
can't help you you know I don't
understand what you're doing you never
went neither one of my parents had gone
to college um you've got to figure it
out for yourself but he was also very
insistent that um he you know he worked
at a company called Regency products
where they did upholstery on cars and he
would bring me there to sweep the floors
not because he wanted me to learn that
business because he wanted me to learn
how backbreaking that work was I mean he
lost an eye in an accident at work um a
staple broke um and he the only thing he
wanted from my brothers and I was for us
to never have to work like that to go to
college to figure it out you said to be
nice that said you also said that you
when you were first starting a business
you were a bit more of an asshole than
you wish you would have been absolutely
yeah yeah because I was more of a yeller
I was you know I no
really yeah what you see on the
sidelines you know with me at a Mavs
game maybe a little bit but I also
didn't have any patience for somebody I
thought wasn't using my kind of common
sense right because I was always on the
go go go go go when I particularly when
I was younger just trying to be
successful trying to get to the point
where I had Independence and I would
tell this to people you know either
you're speeding up and getting on the
train or you know we'll stop and drop
you off at the next station but let's go
where you go did you have trouble with
the higher fast Fire fast part of
running a business yeah always cuz I
hated firing people because it meant one
it was an admission of a mistake in the
hiring and two the salesperson of me
always wanted to come out ahead and I
was always horrible at firing but I
always partnered with people who had no
problem with it so I always delegated
that well this a tricky thing when you
when you're working with somebody and
they're not quite there and you have to
decide are they going to step up and
grow into the person that that's the
right or they're not and in that grayer
area is probably where you have to fire
was hard yeah for sure because you know
there it's obviously a failure somewhere
in the process you know what did we do
wrong and when I would interview people
for
jobs I mean 99% of the people I've ever
interviewed I've wanted to hire because
in my mind it was like okay I can figure
out how to make this person work right
and and then they wouldn't and then you
know people at the company be like Mark
you suck at this you know and so I I
always delegated to hiring yeah I mean
I'm the same I see the potential of
people I see the beauty in people and
which is which is a great way to live
life but when you're running a company
is a different thing it's different and
you got to know what you're good at what
you're bad at right I I was good at you
know I was a ready fire aim guy and I
always partnered with people who were
very anal and perfectionist because
where I could just go go go go go go
they would keep me in keep me inside the
baselines they would do the due
diligence I supp or just yeah the detail
work to dot the eyes and the cross the
tees uh what does it take to take that
First Leap into starting a business
that's the hardest part it really
depends on your personal circumstances
like I got fired I mean I was sleeping
on the floor six guys in a three-bedroom
apartment so I couldn't go any
lower so there was no downside yeah
there was no downside for me starting a
business and it was just like you know I
was 25 when we started micro Solutions
and you know I just gotten fired and it
was like look I'm I'm a lousy employee
um I'm going to just start going to some
of my prospects that I had in my my job
and asked them to front the money that I
needed to install some software and
found this company architectural
lighting who put up $500 for me that
allowed me to buy software and have 50%
margins and you know that's how I
started my company but like by way of
advice would you say I mean it's a
terrifying thing yeah I mean you've got
to be in a position where you're
confident you know I get emails and by
people all the time you know what kind
of business should I start that tells me
you're not ready to start a business
right either you're prepared and you
know it or you don't you know in in the
United States with the American dream
everybody kind
of always looks at themselves and say
okay you know I have this idea right and
then you go through this process of
saying okay you know you talk to your
friends or family what do you think and
then almost always oh it's a great idea
right then you go on Google and you say
oh my God no one else is doing it
without thinking you know 10 companies
had gone out of business trying the same
thing but okay it's on Google and then
people stop right because that next step
means okay I have to change what I'm
doing in my life and that's not easy for
99% of the people some people look at
that as an opportunity get excited about
it some people get terrified because
it's okay maybe I'm comfortable maybe I
have
responsibilities and so whatever your
circumstances are if you want to take
that next step you have to be able to
deal with the consequences of changing
your circumstances and that's the first
thing you know do you save money you
know so you have you know if you have a
job do you have a mortgage do you have a
family you got to save money you can't
just walk you know I mean they've got to
eat and they've got to have shelter but
on the other side of the coin if you've
got nothing it's the perfect time to
start a business yeah desperation is a
good Catalyst for starting a business
but in many cases the decision as you're
talking about you're going to have to
make is to leave a job that's providing
some degree of comfort already so and I
suppose when you're sleeping on the
floor and there's six guys it's a little
bit easier it's really easy right
particularly when you get fired and you
don't have a job you know and you're
looking at bartending at night to try to
pay the bills and so um it wasn't hard
for me but to your point it it really
comes down to preparation you know if
it's important enough to you you'll save
the money you'll give up you know
whatever it is you need to give up to
put the money aside um if you have
obligations um you'll put in the work to
learn as much as you can about that
industry so that when you start your
business you're prepared and you can
always you know at night on weekends
whenever you find time lunch start
making the calls to find out if people
will write you a check you know or
transfer you money to buy whatever it is
you're selling and by doing those things
you can put yourself in a position to
succeed it's where people just think
okay you know gono I'm leaving off the
edge of a cliff and I'm starting a
business that's tough but sometimes
that's like the way you do it though
there's always examples of any situation
or scenario right right but I mean
anecdotal evidence for everything yeah
but if you're if you're going into a new
business you're going to have
competition unless you're really really
really really really lucky and that
competition is not going to just say
okay let Lex or Mark just kick her ass
yeah and so you've got to be prepared to
how you're going to deal with that
competition what what do you think that
is about America that has so many
people who have that dream and act on
that dream of starting a business you
know I think
we've just got a culture of consumption
and more you know and to get more um
you've got to you know creating a
business gives you the greatest
potential upside and the greatest
leverage on your time um but it also
creates the most risk so that capitalist
machine there's a lot of elements by
contrast uh the respect for the law like
an entrepreneur can trust that if they
pull it off the law will protect them
they won't
hopefully that's still the case Yeah
well yeah there's always uh yeah USS
other countries you're right right so US
versus other countries like Joe Biden of
all people said to me um it was at an
entrepreneurship conference that when he
was vice president he had put together
and we had gone up there from bunch of
us from Shark Tank to talk to young
entrepreneurs from around the world and
he said to me Mark you know the one
thing that separate I've been to every
country around the world and the one
thing that separates us is
entrepreneurship we're the the most
entrepreneurial country in the world and
there's no one else who's even close and
when you look at the origin of our big
you know the biggest companies in the
world for the most part there's an
American origin story somewhere behind
there and I think you know that just
gets perpetuated on itself we see those
Horatio Al aler stories we see um
examples of the Jeff Bezos of the world
the Steve Jobs in the world and those
are the types of people we we want to
copy yeah want to be really careful and
try to really figure out what that is
because we don't want to lose that for
sure we want to protect that whatever
you know and that's a lot of the
discussions about what's the right way
to do government big government small
government what's the right policies
what but also culture like who we
celebrate one of the things that
troubles me is that we don't enough
celebrate the uh the entrepreneurs that
take risks and the entrepreneurs that
succeed it seems like success especially
when it comes with wealth is uh
immediately matched with distrust and
criticism and all that kind ofu yeah
it's changing for sure because you know
you can go back just 12 years right
traditional media dominated let's say to
through 2012 you know that was the peak
of linear television you know newspapers
weren't as strong but they still had
some some breath and depth to them um
and then social media comes along and
everybody gets to play in their own sand
boox and share opinions with people who
think just like them and that and it
also gives them the opportunity to
amplify um those feelings and I think
that's where celebrating entrepreneurs
really started to subside some there
were always people who were Progressive
that were like billionaires are bad or
millionaires are bad depending on the
time period but you didn't really see it
on an ongoing basis right it wasn't
going to be on the Evening News it
wasn't going to be in the front page of
the newspaper um it was going to be if
you read a book and someone talked about
it or you read a magazine and there was
an article
um talking about you know this
Progressive Movement or that Progressive
move whatever it may be um you know and
then or political parties but
now all of that is front and center on
social media yeah we're trying to figure
out how we deal with the with the mobs
of people and the virality of it all and
um I I think we'll find our footing and
start celebrating greatness again well
that I mean that's the whole reason I do
shark tank that's true that's that show
celebrates the entrepreneur it's the
only place where every single minute of
every single episode we you know we
celebrate the American dream and the
reason I do it is we tell the entire
country and it's shown around the world
even we you know we're we're amazing
advertising for the American dream in I
don't even know how many countries but
every time somebody walks onto that
carpet from debuk Iowa or Ketchum Idaho
you know that sends a message to every
kid who's watching Seven 8 nine 10 12
year-old kid that if they can do it from
catch Idaho you can do it if they can
have this idea and get a deal or even
present to the Sharks and have all of
America see it you can do it and that I
mean I'm proud of that um the 15 years
of that is just it it's just been insane
you know now kids walk up to me and go
yeah I started watching you when I was
five or 10 and I started a business
because I learned about it from Shark
Tank and so you know I think you know
we're being C it celebrates it and we
convey it and I don't think it's going
away but there are different battles we
have to fight to support it yeah I love
even when the business idea is obviously
horrible just just just the guts to step
up to be there to believe in yourself to
really reach I mean that's what matters
I mean cuz like some of the best
business ideas are
probably uh maybe even you and Shark
Tank will laugh at oh for sure you know
without question the good ones we're not
going to recognize every good one and
then sometimes we'll just motivate
people to work even harder to get it
done because of what we say to them and
and that's fine too you know there's
been great success stories that we said
no to what stands out as like a
memorable business on uh you've been
pitched on Shark Tank what what's the
best one that stands out there's no best
one right they're all different um
they're all best in their own way I
guess they're stupid ones and you
know we haven't had any you know World
Earth world changing Earth shattering
ones right because
those aren't going to apply to Shark
Tank they don't need us right you know
so we typically get businesses that need
some help at some level or another um
but there's ones I've passed that I wish
like spike ball do you know what spike
ball is so it's just rebounding net that
you can put on the beach and you have
these yellow balls and you play a game
of you know it's just a competitive game
but they're killing it so if you go to
beaches in New York or La you'll see
kids playing it all the time and it was
a fun game um that I wish I had done a
deal with there's and there's been
others and you passed and I passed they
they were getting some traction and they
wanted to create leagues spikeball
leagues and they wanted me to be the
commissioner and I don't want to be a
commissioner of a new spikeball league
so you have to kind of have this gut
feeling of will this scale will this
click with people of course yeah can it
be protected is it differentiated is it
something that makes me think you know
why didn't I think of that um or is it
just a good um solid business that's
going to pay a return to the the founder
and may not be enough of a business to
return to um an investor yeah and I
guess the question you're trying to see
will this scale This Promise will the
promise materialize into a big thing we
see I don't even care if it's going to
be a big thing right it because it's all
relative to the entrepreneur we had a
19-year-old from Pittsburgh Laney who
came on with the simple sugar scrub and
there was nothing outrageously special
about it I didn't see it becoming a
hundred million doll business I thought
it could be come a two three5 million
business that paid the bills for her and
that that was good enough and you know 6
months after um the show aired she
called me up she goes Mark I've got a
million dollars in the bank what am I
going to do I'm like enjoy it put aside
money for your taxes and go back to work
you know and so it doesn't have to be a
huge business it's just got to be one
that makes the entrepreneur happy but
then there's the valuation piece I mean
right do do a lot of the entrepreneurs
overvalue of course business yeah I mean
that's that's the nature of it right I
mean and that that's really where the
biggest conflicts in Shark Tank happen
that's in valuation they you know they
they think this is the best business
ever you know there we had one lady um
couple that came on and they had this
scraper for cat's tongues right nice
bizarre most one of the most bizarre
pitch ever I love it um you know and
they had this insane valuation and it
was on because it was corny and fun TV
not because it was a good business oh
really okay you didn't see the potential
none yeah none there's a lot of cats in
the wmart yes there are and they'll go
do very well without me so how do you
determine the value of a business
whether it's on Shark Tank or just in
general it's actually really easy right
so if you take just to use an example a
business that's valued at $1
million and I want to buy 10% of that
company um for
$100,000 then in order for me to get my
money back they've got to be able to
generate a $100,000 in after tax cash
flow that they're able to
distribute can they do it or can they
not right and if it's $2 million Valu
whatever the valuation is that's how
much cash after tax cash they have to
generate to return that money to
investors or the other option is do they
you know do I see this as business
potentially having an exit right do they
have some unique technology or do they
have um something specific about them
that some other company would want to
acquire then the cash flow isn't as as
um not I don't want to say important but
isn't going to guide the valuation and
how do you know if a company's going to
be uh acquired so it's the technology
like the patents but also the team is it
yeah it could be any of the above right
it could be it could be a a super
Products company that um I think is
going to take off and how do you know if
they can generate the money what's
what's the you made it sound easy you
know yeah I mean is can the person sell
you know and if not them can I do it or
someone on my team do it for them so
you're looking at the person yeah for
sure yeah that where Barbara corin's the
best she can look at a person and hear
them talk for 20 minutes and know can
that person do the job and do the work
can you tell if they're full of shit or
not so one of the things with
entrepreneurs they're kind of like we
said overvaluing so they're maybe
overselling themselves but also they
might be full of shit in terms of their
understanding of the market or also like
or exaggerating what they're thinking to
do all that kind of stuff can you see
through that y for sure just by asking
questions you know so if if they are um
delusional at some level or misleading
at another level I'm going to I'm going
to call them on it you know so you get
people trying to sell supplements that
come on there and it's a cure for cancer
or whatever it may be or there's this
latest fad that you know increases your
core strength without doing any
exercises you know shit like that I'm
just GNA bounce I'm gonna pound on them
right see I still love that I still love
the trying just you know give them
credit right because they know all of
America is going to see it and they're
deluded themselves to believe this story
so strongly I mean there's a delusional
aspect to entrepreneurship right like
you just I I see that that's a great
question um do you have to be ambitious
and you know set aside reality at some
level to think that you can create a
company that could be worth 10 100 a
billion dollars right um yeah at some
level because you don't know it's all
uncertainty but I think if you're
delusional that works against you um you
because everything's grounded in reality
you've got to execute you've got to
produce you know you can have a vision
right and you can say this is where I
want to get to and that's my mission or
this is my driving principle but you
still got to execute on the business
plan and that that's where most people
fail yeah you have to be kind of two-
brained I guess you have to be able to
dip into reality when you're thinking
about like the specifics of the product
how to design things how to like the you
know the first principles the basics of
how to build the thing how much it's
going to cause all that yeah I mean
because if you can't do the basics
you're not going to be able to do the
bigger things and at the same time
you've got to be one of the things that
entrepreneurs do that I I always try to
remind any that I work with on is we all
tend to lie to ourselves our product is
bigger faster cheaper this or that as if
that is a um finite situation that's
never going to change right and there's
always somebody I call them Leap Frog
businesses there's whoever's competing
against you you know if you do a or C
they're going to try to do c d and e
right and you better be prepared for
that to come because otherwise they're
out of business too so you're never in a
vacuum you're always competing against
sometimes an unlimited number of
entrepreneurs that you don't even know
exist who are trying to kick your ass
and the tricky part of all this too is
you might need to frequently pivot
especially in the beginning hopefully
not so you think like in the beginning
the product you have should be the thing
that carries you a long time yeah
because I mean that's that's your
riskiest point in time right and so if
you've done your homework which includes
going out there and testing product
Market fit um you should have confidence
that you're going to be able to sell it
now if you didn't do your homework and
you go out there and you sell whatever
it is then and you've raised money or
whatever just to Pivot you've already
shown that you haven't been able to read
the market and so it's not that pivots
can't work and always don't work they
can but more often than not they don't
you pivot for a reason that's because
you made a huge mistake well also mean
like the the micro pivots which is like
iterative development of a thing oh yeah
that's not yeah just iterations yeah you
know entrepreneurship being having any
business is just continuous interation
continuous your product your sales pits
your advertising you know introducing
new technology how do you use AI or not
use AI where do you use it what person
is the right person there's there's just
a million touch points you know that
you're always re-evaluating in real time
that you have to be agile
and adapt and change but especially in
software it feels like business model
can evolve really quickly too like how
you going to make money on this with
software for sure because you know
anything digital because it can change
in a millisecond speaking of which how
did you make your first billion so my
partner Todd Wagner and I um would get
together for lunches and we were at
California Pizza Kitchen in Preston
Hollow in Dallas and he was talking
about um how we could use this new thing
called the internet this is late 94
early 95 to be able to listen to Indiana
University basketball games because that
that's where we went to school and he
was like look when we would listen to
games we would have somebody in
Bloomington Indiana have a speaker phone
next to a radio and then we would have a
speaker phone in Dallas and you know
sixpack or 12 pack of beer and we sit
around listening to the game because
there was no other way to listen to it
so I was like okay okay my first company
micr Solutions you know I'd written
software done Network integration and so
I was comfortable digging into it and so
I like okay let's give it a try so we
started this company called audionet and
effectively became the first streaming
content company on the internet and it
we were like okay we're not sure how
we're going to make this work but we
were able to make it work we started
going to radio stations and TV stations
and you know music labels and everything
and um evolved aet.com which is only
audio at the beginning to broadcast.com
in 1998 which was audio and video and
became the largest multimedia site on
the internet took it public on in July
of 1998 it had the largest first day
jump in the history of the stock market
at the time and then a year later we
sold it to Yahoo for $5.7 billion in
Yahoo stock and I owned you know right
around 30% of the company give or take
and so after taxes that's what got me
there well there's a lot of questions
there so the technical challenge of that
you're making it sound easy but uh you
wrote code but still in the early days
of the internet how do you figure out
how to create this kind of uh product of
of of just audio at first and then video
at first a lot of iterations right like
you talked about um we started in the
second bedroom of my house set up a
server I got an ISDN line which was a
128k line and set up downloaded Netscape
server and then started using different
file formats that were Progressive
loading and allowing people to connect
to the server and do a progressive
download so that the audio you can
listen to the audio while it was
downloading onto your PC yeah was it
super choppy so you trying to figure out
yeah for sure for sure it would buffer
it was yeah was it it wasn't good but it
was a start but it was good enough cuz
it's the first kind of yeah because
there was no other competition right
there was nobody else doing it and so it
was like okay I can get access to this
this or this and then there were some
third party software companies zing and
um Progressive networks and others that
were that took it a little bit further
so we partnered with them and I started
going to local radio stations where
literally we would set up a server right
next to it I had a
$49 um radio the highest FM radio that I
could find and we take the output of the
audio signal from the radio with these
two analog cables plug it into the
server encode it and make it available
from aet.com then I would go on yunet
bulletin boards I would go on CompuServe
I would go on Prodigy I would go on AOL
I'd go wherever I could find bodies and
I'd say okay we've got this radio
station klif in Dallas it's got Dallas
Sports and Dallas um news and politics
and if you're in an office or you're
outside of Dallas connect to aet.com
and now you can listen to these things
on demand and that's how we started and
it started with one one radio station
and then it was five then it was 10 then
it was video content then it um the laws
were different then so we could um
literally go out and buy CDs and host
them and just let people listen to
whatever music and we went from you know
10 users a day to 100 to a thousand to
hundreds of thousands to a million over
those next four years how did you find
the users is it Word of Mouth Word of
Mouth mou didn't spend a penny on
Advertising so the thing you were
focusing on is getting the radio
stations and all or radio and TV
anything any content at all you pick up
the phone what did you how you I would I
wherever I could like everything that
was public domain I'd go out and buy a
video or a cassette whatever it was you
know um and this is before the the DM
the digital minim Copyright Act of 90
whenever it kicked in so literally
anything that was audio we would put
online so people could listen to it and
if you think about somebody at work they
didn't have a most likely and if you did
you couldn't get reception definitely
didn't have a TV but you had a PC and
you had bandwidth available to you and
the companies weren't up on firewalls or
anything at that point in time so our in
office listening you know during the day
what just exploded because whoever was
sitting next to you what are you
listening to right and that was the
start of it and then you know in early
98 um we started adding video and just
other things and we had end up with
thousands of servers you know there was
no cloud back then and um and just
pulling together all those pieces to
make it work but where we really made
our money was by
taking that Network that we had built
and then going to corporations and
saying look you know it's 1996
9798 and to communicate with your
worldwide employees what they would do
is they would go to an auditorium that
had a satellite uplink and then they
would have people go to like theaters or
ballrooms um and hotels that had
satellite downlinks and then would
broadcast you know the product
introductions whatever and so we said to
them look you're paying millions of
dollars to reach all your employees when
you can do it um pay us a half a million
dollars and we'll do it just under their
PCS at work so we did you know when
Intel announced the P90 PC we you know
charged them $2 million or whatever to
do that when Motorola announced a new
phone or a new product we would charge
them and so we Ed the consumer side to
do a proof of concept for Network um and
then we would take that knowledge and go
to corporations and that's how we made
our revenue and there's some selling
there with the corporations yeah a lot
of selling there but we were saving them
so much money and they were technology
companies they wanted to be perceived as
being Leading Edge and so it was winwin
uh how much technical Savvy was required
you said a bunch of servers like at
which point do you get more Engineers
how much did you understand could do
yourself and then also once you can't do
it all yourself
how much technical Savvy is required to
understand enough to hire the right
people to keep building this and Innova
I did all the technology and then we
hired engineer after engineer after
engineer to implement it and so wow yeah
um from putting together a multicast
network to um software to just all these
different things was this like a scary
thing like it's terrifying right because
as we were growing trying to keep up the
scale and literally we're buying
off-the-shelf PCS and then you know cars
as the technology advanced and hard
drives and things would fail and we
would have to you know we didn't have
machine learning back then to do an
analysis of you know how to distribute
server you know resources so you know
like there was there was a time when um
Bill Clinton and all the Monica Lewinsky
stuff happened they released the audio
of um their interviews of him or
something like that right and we
literally we I knew at that point time
when that was released everybody at work
was going to want to listen to it right
so we had to take down servers that were
doing Chicago Cubs baseball right you
know and just make all these on the-fly
decisions because there was no we didn't
have the tools to analyze or predict be
predictive but yeah it was it was all
technology driven and
marketing um the acquisition by Yahoo
can you tell the story of that but also
in the broader context of this internet
bubble this is a fascinating part of
human history yeah so so on the
acquisition side we were the largest
media site on the internet it wasn't
close there was nobody close we were
YouTube and relatively speaking we would
be 10x YouTube relative to the
competition because there was nobody
there um and so it became obvious to
Yahoo AOL and others that they needed a
multimedia component and we had the
infrastructure sales all that stuff um
and so
Yahoo when we went public in 98 or right
before I think it was they made an
investment of like $2 million which gave
us a connection to them and then after
we went public they decided they needed
to have multimedia and so in April of 99
we made a deal and then July of 2000s
when it
closed and uh can you explain to me the
trickiness of what you did after that oh
the um the collar yeah okay so when we
sold to yah we sold for $5.7 billion in
stock not cash and so I looked at I you
know after micro Solutions um when I
sold that um I took that money and
initially I I told my broker I wanted to
invest like a 60-year old man because I
wanted to protect it um but then he
started asking me all kinds of questions
about all these technologies that I
understood like networks I had installed
we had become one of the top 20 let's
say um systems integrators in the
country at one point in time we're the
largest IBM token ring um installer in
the country it was crazy right Bon name
blast from the past I mean so anyway so
these Wall Street Bankers um or analysts
rather um that were the big analysts of
the time would call me up because they
would ask my broker what does he know
about this product this and I knew them
all what was working and not working
right and so the ones that work you know
I say it's working i' see the stock they
say something the stock would go up 20
bucks right so I'm like like well and my
broker was like you need to you know
this better than they do you need to
invest so I started buying and selling
stocks and this was in
1990 and was just killing it I was
making 80 90 100% a year um over those
next four years to the point where guy
came in and asked to use my trading
history to start a hedge fund which we
did and I sold within nine months it was
great right but the point being as it
goes forward so when um we sold to Yahoo
I already had a lot experiened trading
stocks and I had seen different bubbles
come and go a bubble for PC
manufacturers a bubble for networking
manufacturers they went up up up up up
and then they came straight down after
the hype or somebody just um Lea frogged
and so when we sold to Yahoo um I was
like I've got a be next to my name
that's all I need or all I want I don't
want to be greedy and I'd seen this
story before where stocks get really
frothy and go straight down and and I
knew that because all of what I had was
in stock I needed to find a way to
collar it and protect it so
understanding stocks and trading and
options and all that my broker and I we
went and shorted an index that had Yahoo
in it and so the law at the time was you
couldn't short any indexes that had more
than 5% of that stock in it right that
of anyone's of the Yahoo stock and so um
I took pretty much 20 some million
dollars everything I had at the time and
I sorted the index this is fascinating
by the way cuz it's based on your
estimation that this is a bubble or just
mind not want be to be greedy sure so
you're the foundation of this kind of
thinging is uh you don't want to be
greedy yeah I mean how much money do I
need right you know where other people
were saying oh I think can go up higher
higher higher I was like I went on CNBC
and um I told them what I had done and
they were like in Yahoo stock had gone
up significantly from the time I had had
collared and one of the guy Joe and was
on there don't you feel stupid now that
yaho stock has gotten up um you know x%
more I'm like yeah I feel real stupid
sitting on my
jet but so you I mean there is some
fundamental way in which bubbles are
based on this greed greed and I'd seen
it before right like I just said and so
what I did was we put together a caller
where I sold calls and bought puts and
as it turned out when the market just
cratered I was protected and you know
over the next two three years whatever
it was it it converted to cash paid my
taxes Etc but um it protected me and as
it turns out it was called one of the
top 10 trades of all time and what was
even more interesting out of that period
um my broker at that time was at Goldman
Sachs and I had asked him to see if
there was a way to trade Vic the vix
right the volatility index and there
there wasn't right and so one of the the
people that Goldman that we were working
with to try to create this actually left
Goldman and created indexes that allowed
you to to trade the vix it's not trivial
to understand it's a bubble I mean
you're kind of lessening your insight
into all this by saying you just didn't
want to be greedy but you still have to
see that it's a bubble yeah I mean yeah
obviously if I thought it was going to
keep on going up and it was there was
intrinsic value there I would have
stayed in it but it it wasn't so much
Yahoo it was just the entire industry
you would back then you know like we're
looking at the the magic 7 or whatever
it is stock now and people are asking is
it in a bubble and when I would get into
cabs and people just start talking about
internet stocks there were people
creating companies with just a website
and going public you know that's a
bubble right where there's no intrinsic
value at all and people aren't even
trying to make operating cap profits
they're just trying to Leverage The
frothiness of the stock market that's a
bubble you don't see that right now
there's not companies you don't see
hardly you don't see any IPOs right now
for that matter so you know I don't
think we're in a bubble now but back
then yes I thought we were in a bubble
but that wasn't really the motivating
factor do you think it's possible we're
in a bit of an AI bubble right now no
because we're not seeing funky AI
companies just go public if all of a
sudden we see a rush of companies who
are skins on other people's models or or
just creating models to create models
that are going public then yeah that's
probably the start of a bubble um but
that said my my 14-year-old was bragging
about buying Nvidia you know with me in
in his Robinhood account he tells me the
order I place it and he was like oh yeah
it's going up up up you know and I'm
like yeah we're not quite there yet but
that's you know that's one thing to pay
attention yeah we're flirting with it
yeah uh you said that becoming a
billionaire requires luck yeah can you
explain yeah I mean there's no business
plan where you can just start it and say
yeah I'm definitely going to be a
billionaire you can you know if I had to
start all over could I start a company
that made me a millionaire yeah CU I
know how to sell and I know technology
and I've learned enough over the years
to do that um could I make 10 million
probably 100 million I hope so um but a
billion just something good has got to
happen you know um timing timing you
know Internet stock market was going
nuts right when we started you know and
that certainly I couldn't predict or
control um you know it's like AI right
now ai's been around a long long long
long time and the Nvidia processors or
gpus rather you couldn't predict that
now's the time that they were going to
be get to that cost Effectiveness where
you know you could do you could create
models and train them and although it's
expensive it's still doable you know we
didn't really even we had as6 right for
custom applications and we had CPUs that
were leading the way but gpus were more
for gaming and then crypto Mining and
now all then all of a sudden they were
the foundation for AI models so
think luck being essential to becoming a
billionaire is a beautiful way to see
life in general first of all I
personally think that everything good
that's ever happened to me is because of
luck I think that's just a good way of
being it's like uh you're grateful that
said there's some examples of people
that you're like they seem to have done
a lot of they seem to have gotten lucky
a lot you know we mentioned Jeff Bezos
it seems
like he did a lot of really interesting
powerful decisions for many years with
Amazon to make it successful but he was
really able to raise money right a lot
of money and people were really
dismissive of him because they weren't
um making they weren't profitable and we
we were in an environment where it was
possible to raise possible to raise that
money I mean what about somebody you get
sometimes uh feisty with on the internet
Elon but we couldn't even look at Zuck
and Bill Gates and Warren Buffett look
Zuck was just trying to get laid right
and it took off and you wrote some good
stuffff AR we all is some level
Foundation of human civilization right
but um yeah so more power to them right
you can't take anything away from them
but yeah Snapchat same thing took off
apps didn't take off in 2007 when the
iPhone came out apps took off in 2011
2012 and if you were there with the
right app at the right time and even
Facebook um you know in 2004 the bubble
had burst and you know the price for
computer had fallen enough and kids in
school all needed computers or laptops
if he had tried to do something like
that you know 5 years earlier I mean it
was too young but you know five years
earlier or five years later you know
frster might have been the ultimate or
Myspace frster remember frster or
Myspace I had a MySpace account and that
was before Facebook yeah the timing is
important but there's like the details
of how the product is built the
fundamentals of the product like what
well so but that's what gets you when
the opportunity is there
right that's what allows you to take
advantage of that opportunity and and
the Kismet of it all right you've got to
be because it wasn't like any of the
people I mentioned there weren't others
trying the same thing yeah right you had
to be able to see it you had to be able
to visualize it and put together a plan
of some sort or at least have a a path
and then you had to execute on it and do
all those things at the same time and
have the money available to you because
it wasn't like whether it was Google or
Facebook you know they raised a shitload
of money it wasn't bootstrapping it that
got them there and raising money is not
just about sales it's about the the
general feeling of the people with money
at that time in
proximity if duck wasn't at Harvard and
he was at Miami of Ohio University or he
was at Richland Community College same
idea same person same execution and
nothing I believe in the power of
individuals to find
their to realiz their potential no
matter where they come from but I agree
I agree 100% with that right but luck is
required yeah I mean scale is the only
Delta is scale yeah right we you know
we're not all blessed with the access to
the tools that you need to to hit that
grand slam but then also billion is not
the only measure of success right
absolutely not right there's a everybody
defines the success in their own way how
do you define success Mark Kean waking
up every day with a smile excited about
the day you know I was you know people
always say well when you get that kind
of money does it make you happy and and
my answer always is it if you were happy
when you were broke you're going to be
really really really happy when you're
rich but you got to work on being happy
when you're broke I guess well you're
just being happy right if you were
miserable you know in in your job before
there's a good chance you're still going
to be miserable if that's just who you
are that's a pretty good definition of
success by the way thank you how do you
reach that success by way of advice to
people you you know we talked about my
dad U my
parents I never looked at my dad and
said okay you're not successful he
busted his ass and when he came home you
know he we enjoyed our time together
right there was nothing at any point in
time where I felt like oh this is
miserable we're awful we're you know we
don't have this we don't have that you
know we we celebrated the things we did
have and um never knew about the things
we didn't have you know and and so I
think you know you have to be able to
find your way to whatever it is that
puts a smiling on your face every day
some people can do it and some people
can't it's not always about the smile or
the smile on the outside it could be a
smile on the inside yeah whatever it is
right whatever makes you feel good yeah
the the struggle even the struggle like
with your dad the the really really hard
work can be can be a fulfilling
experience because uh the struggle
leading up to then seeing your kid
exactly right right because that's that
that was my dad's grand slam right
seeing three kids go to college be
successful you know spend be able to
spend time with him and that was the
other thing you know he really made me
realize is the the most valuable asset
isn't the money it's your time that's
why you know from a young age I wanted
to retire because I wanted to experience
everything that I possibly could in this
life and you know he got joy from us I
get joy from my kids um and that's the
most special thing you ever can have
beautifully said you have made some
mistakes in your life yeah a lot of them
one of the bigger ones on the financial
side uh we could say is uh Uber yeah we
call that not doing something yeah it
wasn't a mistake it was just I mean it
was a
mistake but I like how you tried to you
I always try to look at mistakes at
things you did that didn't turn out as
opposed to things you did to you know um
the negative but but what can you tell
the story of that and maybe it's just
interesting because it is illustrative
like how to know when a thing is going
to be big and not and what are the
fundamentals of it and how to take the
risk or not and all this kind of stuff
right so the backstory of that is Bill
Gurley came to me and said um Mark
there's this guy Travis that has this
company red swoosh which is a
peer-to-peer networking company that um
I think you can help and so I invested
and would spend a lot of time with
Travis and it's funny because back then
that was like 2006 I was an investor at
at um box.net with Aaron Levy and oh
there's one other company but there were
three of them where there'd be emails
between you know where I'd introduce
them and we'd all talk in these emails
and they'd all gone to be have
astronomical success right um but so red
swoosh had its issues you know cuz I
always look at peer-to-peer as kind of
stealing bandwidth from the internet
providers when bandwidth was a scarce
commodity um and so you know what Travis
did with that though was great you know
he convinced gaming companies who wanted
to do downloads of the clients for those
games to use his peer-to-peer in red
swoosh and you know he busted his ass
and I think he sold it for $18 million
so he did well and so it was natural for
him to come to me and I still have the
emails you know and asked me um about
Uber cap and I thought okay this is a
great idea I really really like it I
said you're going to and he showed me
his budgets and I think they were
raising money at 10 or $15 million or
whatever and um I'm like your biggest
challenge is going to be you're going to
have to fight all the incumbent taxi
commissions they're going to want to put
you out of business that's going to be a
challenge and I think you don't have a
enough money designated for marketing to
get all that done and I said I'd invest
but not quite at that valuation right
never came back to
me yeah I mean there's some lessons
there connected to uh what you're doing
now we'll talk about a Cost Plus drugs
is like looking at an
industry that seems like there's a lot
of complexity involved but it's like
hungry for revolution for sure and the
Cals are that yeah for sure right they
were they were dominated by an insulated
few they were not very transparent you
didn't know the intricacies they were ve
very politically driven um and old boy
incestuous Network and to tra you know
and like I told him Travis the best
thing about you is you'll run through
walls and break down barriers the bad
thing about you is you'll run through
walls even if you don't have to you know
yeah and there you kind of have to see
is it possible to raise enough money is
it possible to do all this is it
possible is it possible to break through
and it's kind of a fascinating success
story with Uber is I think he tried to
go too big he had too big an ambition
which cost him in the end not
financially and personally but just you
know in terms of being able to stick it
out with them um but you know that's
what makes him a great entrepreneur well
it's a fascinating success story you
have like certain companies like
Airbnb just kind of go into this thing
that we take completely for granted and
change it all just change it all yeah
blinda Johnson who worked as our general
counsel at broadcast.com was you know
was Brian's um GC and Chief Operating
Officer so yeah they they had a smart
smart smart smart team and they believed
in it and they I mean it's just it's a
it's a beautiful story cuz you're like
all right all the things that annoy you
about this world like they're
inefficient and it just seem like pain I
probably would have said no like a lot
of people did to Airbnb because I'm like
I don't want people sitting my sleeping
in my bed I would have too I was like
this is not going to work I've done like
cou surfing and stuff and it was always
it didn't seem right it didn't seem like
you could do this at a large scale to
monetize it yeah but he did more power
to him in 2000 I think January you
purchased a majority stake in the the
NBA team Dallas
Mavericks uh for 285 million so at this
point maybe you can correct me but it
was one of the worst performing teams in
franchise history uh true how did how
did you help turn it around um I had
this big tall guy named Dirk niski and I
let him be Dirk nitzki right and I got
out of the way um but I think more than
anything else um there was the
turnaround on the business side and then
there was the turnaround the basketball
side and on the basketball side I just
went in there immediately said whatever
it takes to win that's what we're going
to do um you know back then they had
three or four coaches that were
responsible for everything and I was
like okay we spend more money training
people on PC software than we do
developing the most important assets of
the business so I made the decision to
go out there and hire like 15 different
development coaches one for each player
and everybody thought I was just insane
but you know it sent the message that we
were going to do whatever it took to win
and once the guys believe that you know
winning was the goal as opposed to just
making money attitudes change effort
went up and you know the rest is history
so the assets of the business here are
the the players the players yeah for
sure and then on on the business side
the first question I asked myself is
what business are we in and I really
didn't know the answer immediately but
within the first few months it was
obvious that you know the the entire NBA
thought we were in the business of
basketball we were not we were in The
Experience business when you think about
sporting events that you've been to you
don't remember the score you don't
remember the home runs or the dunks you
remember who you were with and you
remember why you went oh was my first
date with the girl who now my wife or I
went with my buddies and he threw up on
the person in front of us you know my
dad took me my aunt my uncle took me
those are the experiences you remember
and once um I conveyed to our people
that this is what we were selling that
what happened in the arena um off the
court was just as important as what
happened on the court if not more so
because if you know Mom or Dad are
bringing the 10-year-old you have to
keep them occupied because they have
short attention spans and so you know I
would get into fights with the NBA you
know put aside the refs but getting
aside in fights in the NBA I would say
NBA nothing but attorneys right because
they had no marketing skills whatsoever
and to their credit you know they
realized that was a problem and started
bringing in better and better better
marketing people so part of the selling
is you're selling the team selling the
sport
selling the people the idea the all of
it like just the well yeah the
experience so if you have you ever been
to an NBA game yeah Miami Heat you
remember walking into the arena and you
feel the energy right that's what makes
it special yeah the energy is everything
especially playoff games right for sure
right and even a regular season game
right even against the worst team you
know that's where we get you know
because the tickets are tend to be a
little bit cheaper on the resale Market
that's where parents will bring their
kids and so you hear kids screaming the
entire game and the parents are thrilled
to death right they got to do something
with your kids the kids are thrilled to
death because they got to see basketball
an NBA game and scream at the top of
their lungs and you know if it turns out
to be a close game and that ball's in
the air and if it goes in you know
everybody's hugging and high-f fiveing
people you've never seen before in your
life and if it misses you're
commiserating with people you've never
seen that's such a unique experience
that's unique to sports and we never
sold that and that's exactly what we
started see I have to say like just
going to that game turned me around on
basketball cuz I'm more of a football
guy so basketball wasn't like them a
sport I was like oh wow okay ener like
yeah the energy in a in a stadium is
completely different than the energy in
Arena you know you can you know in the
stadium particularly if it doesn't have
a roof it's hard to to bottle that
energy you feel it and you see like I'm
from Pittsburgh so there's a terrible
tows and people screaming defense and
everything
at Steelers games but in an arena you
the energy level is just Indescribable
so how much of it is the selling the
tickets in person but also uh versus
what you see on TV so when you're owning
a team do you get any of the cut for the
what's showing on TV yeah yeah we yeah
so the there's a TV deal that's done
with either a local TV broadcaster and
we get all of that or um a network
broadcaster like abcc um ESPN TNT
whatever and then we get 130th of that
so what role does the TV play in like
turning a team keeps fans connected look
when a team is doing really well it's
easy right there's more viewers
everybody's more excited um and when
you're not it you know there's still
going to be hardcore fans and and you
know General fans and kids that like to
watch the game what about like the
personality of the people in the in in
the stands like I mean clearly you're
part of the legend of the
team because you're literally there
going yeah screaming yeah the whole game
right yeah it's funny you know you the
way I am here is how I am you know 24
hours a day unless there's a Mavs game
yeah you know and and for whatever
reason that's where I let out all that
stress and frustration um but yeah I
mean it's not so the fans you know the
sixth man right we need fans to bring
that energy and you know amplifying that
as much as we can is important you've
had a beef recently on Twitter on X with
Elon over Dei programs
what to you is the essence of the
disagreement there I wouldn't call it a
beef right I it's just it's a bit of fun
yeah it's fun for me right um I just you
know it's his platform he gets to run it
anyway please he pays for that right and
so I have total respect for whatever
choices he makes even if I don't agree
with them but because it's his platform
people are less likely to um disagree
with him particularly somebody who's of
who's got a platform themselves and so
when we start talking about Dei and it's
just de facto racist and this stuff
stuff that I just think is nonsense I
have no problem you know sharing my
opinion um and you know if he disagrees
okay he can disagree I don't care you
know and it's fun to engage but he
doesn't really engage you know he just
comes back with snark comments which is
you know his choice yeah you in your
comments well you do a bit of snark too
but yeah a little
bit but you you're pretty um let's say
rigorous in your response so there is
some exchange of ideas there's some
snark there's some fun all that kind of
stuff and uh you do voice the opinion
that represents a a large number of
people and it's great I mean that that's
what's it's really beautiful uh but just
lingering on the topic what to you is
the good and the bad of Dei programs
really simple right d is diversity and
that means you just expand your pull of
potential applicants to people who you
might not otherwise have access to you
know to look where you didn't look
before to look where other people aren't
looking for Quality employees um that's
simple and the e in equity means when
you hire somebody you put them in a
position to succeed the eye inclusion is
when you've hire somebody and they may
not be typical if you will right you
show them some love and and give them
the support they need so they can do
their job as best they can and feel
comfortable and confident going to work
it's that simple so that's a beautiful
ideal when it's implemented implemented
poorly perhaps or in a way that doesn't
reach that ideal do you see maybe when
it's uh quota based do you see that it
can result in essentially racism towards
Asian people and white people for
example there's a lot to unpack there
right um so first you can't do quotas
they're illegal unless they you're um
and I'm not the lawyer on this subject
but unless you're you're trying to
repair something that's happened in the
past like some discrimination that's
happened in the past so it's not quota
based and I think that's really just
kind of a a straw man that that people
put out there now does that mean that
there aren't Dei programs that are
implemented poorly of course not there
are everything that's implemented poorly
in one company to another right sales
marketing um Human Resources you can
pick any element of business and find
companies that implement it poorly um
but that's the beauty of capitalism in a
free market or mostly free market where
if you make these choices and they are
the wrong choices you're going to lose
your best people you're not going to be
able to hire the best people you're not
going to execute on your business plans
in the way that we discussed regardless
of the size of the company and it also I
think depends on where you're having the
discussion so when I'm in a different
group of people off of X the feedback is
completely different right um
but to your question of Reverse Racism
yes it happens there's I mean because
people are people there's no you know
there's no human being that is 100%
objective and
it's also there's very very very few
jobs that can be determined on a purely
quantitative quantitative basis right
how do you tell one good J One janitor
from the other who's the best right how
do you tell one salesperson that you're
hiring versus another you're hiring
because they haven't sold your product
yet so you don't know we talked earlier
about firing people because you made
mistakes and you know yes there's
discrimination against any group White
Asian black green orange whatever it may
be but I truly believe that there's far
more discrimination against people of
color than there are people who are
white and I think it's it's become a
straw man that reverse discrimination
because of Dei is is prevalent or near
ubiquitous uh well much of American
History was defined by intense radical
racism and sexism mhm
but in the recent years there's a a
correction and I think the nature of the
criticism is that there's an
overcorrection where Dei programs at
universities and companies are often
when they're not doing their job well
are often hard to criticize because when
you criticize them within the company or
so on you can they have a very strong
immune system where that you could they
could if you criticize a dii program it
seems like it's very easy to be called
racist and if you're called racist or
sexist that's that's a sticky label for
some reason so you're getting into the
culture of organizations right and
Leadership within
organizations and accepting any type of
criticism put aside
Dei when I criticized the referees in
the MBA I got fined right that was their
option I knew what I was getting into
right not that they're completely
analogist but it's cause and effect if
I'm in a major company and I'm publicly
criticizing or even internally
criticizing a sales plan or a product
our product sucks right or like there
was a Google engineer that got fired for
saying you know Google had AGI right and
nobody believed they did and they knew
that created problems it wasn't de
related but it was you know saying
something publicly that was to the in in
the CEO's eyes to the detriment of the
company right so I think those are all
analogist if you you're trying to
accomplish something within an
organization because you think there's a
problem and there's people speaking out
saying look you we're getting it wrong I
think I'm I'm a victim of all this and
the company right then you know
leadership has got to make a decision do
do they agree or not agree are they
right or they wrong is it to the the
positive is it positive or negative to
the company and you decide so you know
this conversation that conservatives are
being um silenced in organization
now um I just I haven't seen it you know
I've talked to and then the other side
of the your question I think I'm packing
it is
um what's driving all this put aside
universities for one in Corporate
America when I talk to people in
Corporate America about um
Dei they always start talking about
ideology right and like I talked to Bill
who you've had on right and when I asked
him well Bill you run your own companies
who's telling you what to do they are
who's they well it's the universities
you know the people who have this
ideology of Dei I'm like did they force
you did they coer you did did you lose
control of your company no it's not me
it happens to other people then I talk
to other people same thing so I get you
know try not to go oneon-one and tip
Twitter conversations on this topic so
in the DMS I'll talk to people who are
really um conservative and I'll ask the
same question um and be like well who's
forcing you to do this well it's the
ideology that's Everywhere You See It
Don't didn't you see the Harvard thing
you know in University of North Carolina
I'm like I've never had anybody try to
push me in this direction to do this
this was my business Choice I'm not
trying to tell other people you have to
do this you make your own business
choices and so where companies have made
their business choices and somebody
doesn't feel confident or comfortable
with it they may feel they're being
discriminated against there was
something I just read in the Wall Street
Journal where the Wall Street Journal
had a company interviewed two million
people right and the difficulty and
firing and how people when they were
fired 40% of the people who were fired
felt like it was wrong that they were
doing a great job yet they then I talked
about the HR person going through the
hassle of trying to explain to this
person through performance reviews that
they weren't doing a good job yet the
people still thought they were doing a
great job despite being told they're not
doing a good job right so I see that as
being an analogist to all this you know
this huffing and puffing about um
reverse discriminations and
conservatives not being able to speak up
because 40% of people who have been
fired don't believe they should have
been fired there's there's a disconnect
somewhere in how you think you're doing
your job and um
if you just feel like I can't speak up
because of it um because of you're white
and that doesn't comport well with Dei
programs a lot of things are going to
happen right either you're going to
that's going to come up in your
performance review HR or your your boss
is going to have to address it in some
way it's going to get to HR at some
level and then decisions are going to
have to be made and Comm and you can't
just fire somebody because they spoke up
right somebody's going to have to
communicate with you and so I think a
lot of I just I I just don't trust the
supposed volume that people say it's
happening that versus everything I've
read and seen and when I talk to people
in positions of authority within
organizations and ask them who's forcing
them you know to implement these
ideologies nobody says nobody says yes
that there is
somebody but on Twitter it sounds great
it is true for conservatives but in
general you can sell books can get likes
yes when you talk about this ideology
and there's a degree to which is is this
woke ideology in the room with us right
now uh meaning like it's this boogie
monster that we're all kind of or is it
a positive I guess another way to say
that is they don't highlight a lot of
the positive progress that's been made
in the positive version of the word woke
in terms of correcting some of the
wrongs done in the past so but that said
you know if you ask people in Russia
[Music]
so the vision the ideal of di is is a
beautiful ideal it's just like well
maybe it's because I'm an entrepreneur
when I see an ideal that you know you
try to implement it and support it and
get to that point but universities and
companies are night and day different
right I can see an argument for the
ideology in a university I can see you
know you look at the the the amount of
money spent on it and so while the the
goal is right um the way they implement
it in universities the way they
Implement most things in universities is
wrong right there's a reason why tuition
has gone up you know a multitude of uh
or a multiple of inflation um they're
not well-run organizations across the
board so I'm not going to argue with
that at all so when you've seen me argue
with Dei I haven't waited into Dei and
Universities at all so it's mostly
focused on companies 100% right because
that's where where I exist but at the
same time like I read Christopher ru's
book where he talks about the kind of
the genealogy of ISM and and ideology
but then he gets to the point and I hope
I'm remembering this right where he says
that the response to it is
decentralized activism if you will
that's not the word he used to try to
counter that
Dei
and that seems to me to be counter to
the whole conservative movement right
now right other than School boards right
where it's centralized and you know the
Republican candidate is all about
centralized power in him and you know I
to me that's just a conflict in a lot of
the under opinion of this of the whole
Dei conversation that a lot of it and a
lot of which goes through Christopher Ru
right now let's continue on a theme of
fun exchanges on the internet so Elon
tweeted the fundamental exatic flaw of
the woke mind virus is that the weaker
party is always right in parenthesis
even if
they want you to die and you responded
at length but the beginning is the
fundamental ecomatic flaw of the
anti-woke mind is that it allows groups
with historical power to play the victim
by taking anecdotal examples and
packaging them into conjured
conspiratorial ideology that threatens
to upend the power structures they have
been depending
on so uh says it all
right well there's a mention there
so yes but both can be abused right both
positions of power can be abused there's
power in Dei and there's shitty people
that can crave power and hold on to
power and sacrifice their ideals okay
put aside universities okay damn it yeah
I mean I because I'm not going to argue
that universities Implement Dei well
right
and I'm not going to tell you that um
you know they need to be spending 20
some million dollars a year on Dei
positions to me that's insane um do I
look at the Harvard and North Carolina
decision and say it was a great decision
no because you know I think having a
diverse student body helps make for um
kids who are better prepared for the
real world but I'm not running a
university so it's not my choice maybe
at some point in the future I will but
not now um and in terms
of the corporate side of
it who's telling anybody what to
do well maybe you can give me some help
sure I'm here to help you Le there's an
example in the AI world of
uh a system called
Gemini everybody was black or whatever
people the color George Washington black
Nazis were black so why why is it when
that came out it was a big uproar but
when somebody so who oh who was it one
of the people who were trying to fuck
with me um I forget which one um there's
so many yeah but um he pointed out to um
Elon that grock elon's AI was woke when
it answered certain questions and other
people have pointed out other things to
Elon about gr Gro gr whatever they
however it's pronounced um that was
leaning left or woke right and elon's
response was oh it'll change it's a
mistake we're fixing it when it happens
to Gemini in Google it's the end of the
world look how woke they are and it's
reflection of all their culture now
Google comes out and says it's a mistake
and then they dock the guy um who was
the product manager or whatever of AI of
that product um who and then they go
back and look at his old tweets right
and show that he is very left leaning
and very you know Dei supportive and
that's the end of the world it's not the
end of the world but uh Google's so
much uh dependent on trust that trust a
Google search has as objective as
possible um channel into the world of
information and so that brand is really
important for yeah see you're you're
over you're giving them too much power
um and maybe I'm I'm not recognizing the
power right so I'll tell you a personal
experience um up
until a month ago maybe if you put in
keto gummies Shark Tank keto
gummies into Google it would show up
with scammy ads scam ad after scam and I
get emails um up until a month ago from
elderly people asking me why the gummies
weren't working and why the companies
were charging um all this money on a
month-by-month basis when they tried to
cancel and they said it was the number
one deal on Shark Tank of all time right
and all shark right it was a mistake
well there's fraud there's mistakes but
the mistakes no but why didn't Google
fix it right distance didn't happen once
over one week over two weeks right and
because it was hard to fix yeah as it
turns out I was working with them to try
to find a fix and we would both look the
same page and if you were inside of
Google within the google.com domain it
would show one page if you were outside
of Google it would show another and it
took us looking at it at the same time
for anybody to realize it meaning that
there's a lot of Technology problems
that are hard to fix they're super
complex and we could talk about it
forever with with social media the
criticism towards Google towards other
companies when they're based in ccon
Valley there could be an ideological
drift into um a ideological bubble out
of which the technology is created and
they could be blind to the obvious bias
that's
that's billions of customers who are not
going to so what you're saying is the
free market stops with artificial
intelligence that people don't pay
attention and respond that Google
doesn't listen to the responses that
people inside of Google will ignore
their own best financial interest and
even their own best personal interest
because they know they're going to get
docks now on on by Elon and others and
so so I just don't see that and and
elon's not allowed to make those same
mistakes but is allowed to make those
mistakes but Google isn't oh no Elon is
100% should be criticized for for the
Ridiculousness of over statements that
he makes about various products he's
having a bit of fun like you are also uh
uh but and I also believe in the free
market but it's not it's not always
efficient you know there's like a delay
just takes time yeah it's fine so which
is why Elon is important we're calling
out I think overstating the criticism of
Gemini but Elon and others are just
Gemini wasn't even a fully available um
public product yet it's still a bias
that resonates with people that's the
way neural networks work though right
that's why there'll be millions of
models because weights and
biases putting together you know a
neural network but well no so like the
the the black George Washington is an is
a correction on top of the foundation
model to keep it quote unquote sort of
safe one of the big criticisms of all
the models frankly probably even grock a
little bit less so is they're they're
like trying to be really conservative in
this in the sense of trying to be
careful not to say crazy shit of course
because because we don't know how the
thing it's brand new and we know what
happens right and they do it on the
front end with prompts and they try to
do it on the back end with the neural
networks that are underneath them right
and it doesn't always work and that's
why there's going to be millions of
models rather than just you know four
foundational models that every or five
that everybody uses well I guess the
main criticism is you want to have some
transparency of all the teams that are
involved and that this kind of to the
degree there's a left leaning ideology
within the companies it doesn't affect
the product but that's the beauty of the
free market yeah that's where the market
corrects it right and not only from the
outside because everybody you know was
going to test it like when YouTube first
came out or not first came out when
after Google bought them you used to be
able there used to be um different
commands you could give it right there
were line um prompt commands that you
could give it and you could find all the
nasty porn that got loaded before the
they they kicked it off right right and
it was just the nastiest shit ever and
even now to this day if there's some
horrific tragic event somebody's loading
it up right now I know that's not Direct
to your point of internal influence to
the output right but people on the
outside are going to check for that now
right it's almost like the new Bug
Contest right to try to find bugs and
software and then on the inside if it's
all left leaning and all you have is
left leaning employees because you know
most conservatives won't want to work
there then again that's self-correcting
as well that's the hope but it can
self-correct in different kinds of ways
you can have a different company that
competes and becomes more conservative I
mean My worry is that that it's kind of
becomes like two different worlds where
there's like it already is the no come
on don't give up oh I'm not giving up
don't give so it where does this go is
the question yeah right what what
happens next and I mean going back I
mean I've been in so many PC revolutions
right or Evolutions um where porn was
the big issue right now we don't even
talk about porn being an issue even
though you know if every every post on
Twitter now has know Lincoln
bio for for a porn post right we don't
even think that's that's a negative
anymore that's just a an accepted thing
and now it's it's become very um War
your politics on on Twitter but again as
you extend that and and Things Grow you
as AI models become more efficient and
trainable on less for a lot less money
or even locally on a PC or a phone we're
all going to have our own models and
there's going to be millions and
millions and millions of models and not
just foundational models now maybe op
maybe they're built some on open source
maybe you know um it'll be copy pasta
where you can just cut and paste and and
create your own model and train it
yourself maybe it'll be mix mixure of
experts where you know maybe it'll be a
metap front end like we're working on a
project where we take 30 different AI
models and there's just a meta search
engine where it searches all of them and
you can compare all the outputs and see
what you think is is the best kind of
like a search engine right because you
might get is Dei good right you know is
the covid vaccine good right you're
going to get a variety of of of um
outputs and you have to make that
decision yourself that's what I think is
going to happen with AI as well because
I think Brands there's no way the Mayo
Clinic and the Harvard Medical School
are just going to contribute all their
IP
to chat GPT or gemini or whatever
they're going to it's going to have to
be licensed or they're going to do their
own yeah I mean that's a very hopeful
message but that said you know uh human
history doesn't always autocorrect
really quickly self-correct really
quickly sometimes you get into this very
painful things you have you have Stalin
you have Hitler you can get to places
very quickly where the ideological thing
just Builds on itself and like you but
Twitter is not real world you know
there's there's 20 is not real world
that's true yes but you could still have
a nation captured by an ideology I think
America has been really good at having
these two blue and red always at at
tension with each other dividing the
populace and in the process of doing
that figuring stuff out like almost like
uh Playing devil's advocate but like in
real life you know and that's that's
fair and that's right you know as
opposed to Prova telling you everything
you want to know right and and everybody
believing because there's control of
everything right and so going back to
what you said earlier people in Russia
don't think that you know invading
Ukraine it's it's you know a lot of them
see it as a positive right um I'm sure
you have relatives and friends who think
you know it's the best thing that ever
happened right because they believe in
in Putin they're densifying Ukraine
they're removing the Nazis ukra right
because that's exactly what Putin said
and you know we don't
have one uniform um media Outlet that's
the difference even though people like
to talk about mainstream media as being
the source of a lot of the friction
there is no such thing as mainstream
media anymore you know Fox is the
biggest um Cable News Channel with the
biggest audience and they call everybody
else mainstream media you know it's
insane the things that we accept from
our sources of information to me that's
the bigger problem the bigger problem is
trying to figure out what is free speech
and what is the line of Tolerance for
free speech and at what point does
hateful Free Speech crowd out other
other people right Putin's the master of
that he you're going to jail or you're
going to be dead if you disagree right
now God help us if we ever get to that
point here but the person who controls
the algorithm controls the world right
and if you are committed to one specific
platform as your singular source of
information or Affiliated platforms then
whoever control
MIT were on right leaning media several
things actually let's even go there
you've gotten a bit of a beef with uh
again fun with Jordan Peterson about
this that's the guy whose name I
couldn't think of yeah so the topic
there was the gender transition and
Dylan moaney can you can you explain the
nature of the beef I mean the it's an
interesting claim you're making that
most most of the people who are concern
concerned about this are conservatives
yeah just the point is that if you
looked at Impressions like when you run
an ad you're curious about Impressions
and who sees them right um but if you
look at the Impressions related to Dylan
McDermot um I would like I just said I'd
bet 90% or more were in conservative
media and you know I don't know how many
followers she had 250,000 followers or
whatever when the Bud Light ad came out
and if it weren't for Kid Rock shooting
you know guns um shooting at Dylan
mcdermit Bud Light cans she'd be long
forgotten yeah but most of the people
people that care about censorship are
going to be free speech Advocates so
like most people that care about Putin
suppressing speech or anybody else
suppressing speech are going to be like
libertarian so like it there's there's
probably an explanation of that you the
the criticism that Jordan Peterson could
provide I guess he said that uh Dylan
malany
popularized the kind of Mutilation right
in his view um they can affect there a
very serious lifechanging process that a
person goes through and when that's
applied to a child it can do a lot of
harm to a person if but my point still
holds I don't know how many kids were
following and you can look at the
followers list it's not like it's hidden
right back then if they had 250,000
followers and now we're on Tik Tok um
you know where he might get 50 some
thousand views or likes right I don't
know how many views but likes I don't
I've never seen any evidence that Dylan
mcder
influenc people to transition their
gender as he transitioned to her it was
documented on Tik Tok over the course of
a year and again when you go back and
look at the views on those Tik toks it
was you know it wasn't like
enormous yeah but the trends start right
it could be uh what worries people is
for young kids there to be a
trend of especially when you feel like
an outsider you feel not yourself less
than yourself all this kind of stuff
that kids feel like that if it's because
popular enough as is a trend you would
gender
transition uh without meaning to do that
is just part of a trend that's the worry
they that is a big stretch right to
think that all the things that have to
happen before you transition gender
right and I'm not saying kids um
might identifi you know find it cool or
you know in the moment um expedient if
you will um to dress up as the other
gender great who cares right but to go
through the actual physical transition
like I don't remember what the numbers
were that I read but I do remember that
the latest numbers that came out in
terms of transitioning were from jamama
which is a medical association that said
um 20 from 2020
one to 2022 the numbers went down but
the bigger point is there are no numbers
for 2023 when post Dylan mcder so
there's no way to know if the assertion
is true even marginally true now you can
you can easily suggest it right but you
can say say that about any social media
influencer right you know people are
kids are dying because you know I mean
it's just like when people accuse Trump
of potentially influencing people to you
know inject bleach into their
veins you can't you know that's a big
old leap to say that because the you
know Trump says it that people are going
to start invest you know injecting and
then they find somebody who actually did
and it's like oh it must be true you
know this is a trend now I just I'm just
not buying it that there aren't enough
roadblocks in the way now I'm not saying
it never happens right and I and for me
to me you should have have to wait until
you're 18 to actually have any surgery
to transition um and if your parents
approve it earlier then you can have a
conversation with your doctor but you're
suggesting that everybody in that
process to go to transition a minor is
corrupt that the doctor the sociologist
the psychologist all the people involved
the hospital where the surgery is
happening the insurance company that's
paying for it they all have been
corrupted by this trend I just don't see
that well not corrupted but you know
people uh it's back to the Dei thing
there could be pressure and we are
pressure to operate so think about all
the people who have to be complicit yeah
to do an operation it's not complicit
like evil complicit it's it is evil
complicit right because somebody Doc in
hospitals right now they won't perform
abortions because of state law in
Alabama they stopped IVF treatment
immediately after that um ruling by that
judge right the Q andon judge does they
think that they're not going to pay
attention to the possible consequences
of being the hospital that does
transgender that that uh gives doctors
operating rights there and not be um
aware of the risk associated with it and
double check to me that's just insane
they're risking their entire business
and livelihood and personal
relationships for not checking that this
14-year-old you know Boy Who Wants to be
a girl or vice Versa is there waiting
for for surgery that I just don't see
that in America yes but if we look at
humans in
general and Jordan Peterson I think
unjustly incorrectly brought up oswit
yeah that was that was ridiculous but if
we
look to me World War II is a very
interesting time it does reveal a lot
about human nature and that humans are
able to commit
atrocities without really speaking up
the point I want to make is that when
you're in this situation where everybody
is around around you is committing an
atrocity you can be sort of the the good
German and and yeah but I mean human
nature is such that you can but that
that is in a time of
War yeah but it's still human nature
it's interesting to remember that war
when you feel like there's nationalism
patriotism everything that comes up
Russia right you know the moms of the
the kids sent to be you know sent to
Ukraine who didn't come back in Russia
feel certainly different than the the
everyday Russian who's just taking you
know whatever information that's
available from a unified controlled
media yeah but you know we should
remember human nature it's interesting
I'm not dismissing human nature at all
but there's a difference I think that
human nature self-preservation
influences those decisions there's
nothing about self-preservation involved
in Dei
attention wanted to say thank you your
Consultants at Tesla followed up about
using Cost Plus drugs but which we'll
talk about to save the company money
truly appreciate it and in parenthesis
my limit is 300 years of Darkness very
well done Mark uh what's your intuition
if we just stick on Biden and Trump for
a sec uh what's your intuition why Biden
would make a better president Trump look
at if at the basics right if you look at
the people he's
hired um there hasn't been any turnover
in his cabinet at all if you look at the
people he's hired um over the course of
his career or while he was vice
president in particular there's nobody
who's turned on him and came out and
written books and made public statements
about how he bad for the country now
compare that to Trump the people closest
to
him almost all of them turn unless
there's a financial relationship
involved and to me that says everything
the Dynamics of the team is important to
you when if you're going to be the most
powerful person in the world you better
know how to manage and Lead right and
that that's not to say Biden hasn't made
a a lot of mistakes I mean immigration
the border is horrific mistake um and
hopefully he he recognizes that and I
don't like the fact that he doesn't
admit his mistakes and just say okay I
got to fix it or I made a mistake in
Afghanistan whatever it may be right the
the position of commander-in-chief and
um president you're going to make
mistakes then I look at the other guy
never miss a mistake and the list is
long what do you think about the
immigration situation a lot of
conservatives are using
that uh sort of
the the the theory is that the reason
it's happening is because they would be
able to illegally vote that's insane for
Biden yeah you can't be an illegal
immigrant and vote and now in a lot of
States because of the conservatives
they've passed laws saying you have to
show identification when I voted in
Texas you had to show you know state
identification they they can't vote you
can't register as an illegal alien that
I'm aware of to vote yeah but of course
that story that really worries me um
enables or serves as a catalyst for
questioning the legitimacy of an
election I remember going to the debate
with Trump um in 2016 and and he was
debating Clinton and one of the things
he said was we don't even know if this
election will be legitimate if I lose
this was in 2016 before he was even
elected and that was where he was going
that's just what he does he's never
admitted a mistake the guys failed a
zillion times most people say okay I
learned from him you know read I read a
book about Roy Cohen and you know Roy
Cohen was the ultimate deny deny deny
and that was one of Trump's mentors and
you can see almost everything of Roy
Cohen ever did in the same way that
Donald Trump approaches things but given
how drastic the immigration situation is
it be that story becomes more believable
yeah of course it does right but the
facts are still the facts right and in
red States they're going to be checking
every ident ID they're going to be
making sure it's not the case and you
know you can also make the argument well
in the blue state it doesn't matter in
the the swing States they're still going
to be checking because they know Trump
is going to sue the shit out of him when
he loses you know and so again and
that's where you know people will take
those self-preservation steps to keep
their job and do the right thing there's
still enough people who believe in this
country and how amazing it is to do the
right thing and a lot of the premise of
what some conservative conservatives are
saying and doing the underpinning of it
is that their fellow citizens will not
do anything not something anything if
that serves the best interest of this
country and to me that's just wrong you
know that is just misleading and wrong I
just worry about I don't care about
Trump or Biden I care about democracy MH
I just worry I I worry about the viral
nature of the idea of this illegal
immigrants but it's it's just it's very
functional right either they get across
there's a thousand different ways to an
unlimited number of ways to enter the
United States of America undetected
right and the South border where it's
the easiest and the worst and Biden
needs to take steps to reduce that
remember when Biden was vice president
and um Obama was President they called
Obama the deporter in Chief he had no
problem deporting people and I think if
I had to guess and this is just a guess
that when they looked at the initial
statistics for immigration when Biden
took over they thought there was room
for more immigrants not because they
would vote but you know you can make an
a fiscal argument that in in a world
where the birth rate is flat to
declining we need immigrants right and
immigrants typically don't you know
don't have a higher crime rate or
anything than you know indigenous
American citizens indigenous isn't the
right word but American
citizens um and so they made a
calculated mistake they made a decision
that was wrong and now they have to fix
it or it's going to hurt them severely
but I don't bu you know like what elon's
pushing that um the whole reason is they
are voters and will become voters and we
should say the obvious you're a
descendant of immigrants yeah for sure
and the immigrants is what makes this
country great in many parts of the
diversity of this nation and we should
probably keep the people that are like
already been in this country for a while
and they're killing it like PhD students
and all this it's like that's not what
Donald Trump wants though he wants to
ship them all out right there's just a
whole lot of hyperbole when it comes to
talking to all about about talking about
all of these things we're talking about
when there it's right versus left my
team versus your team My Tribe versus
your tribe the only way to stand down is
hyperbole the hard part and why I like
this conversation is how do you
distinguish hyperbole versus reality and
I get where you're going Lex where it's
like
what the smallest spark sometimes can
cause people to change and then that
spark becomes bigger and then it becomes
um more widespread and then all of a
sudden your country has changed it's not
what you thought it was I I get that
completely right and yes you always have
to be on top of that to make sure but a
lot of that comes from lack of
leadership right and lack of trust
because there's nobody who's saying all
right Republicans that's all Hyperbole
and you're wrong for that Democrats you
fucked up on immigration right you
fucked up in as Afghanistan right here's
where you made my these mistakes own it
there's nobody who says right um we're
not going to just bring in Republicans
if the Republicans win and then you you
know and there's nobody who says we're
not going to just bring in Democrats
we're going to bring in a mix right
we're going to try to get balance on the
Supreme Court there's just there's no
leadership that's doing that that's the
fundamental problem it's not about the
ideology of woke it's not the no
leadership yeah leadership and yeah
there's it's it's whatever systems we've
created it's it's really frustrating
that uh if you don't like Trump it's it
really is Trump derangement syndrome
like he's the he's definitely Hitler if
you don't like Biden he's Cena lizard
person right um that right everybody
gets labeled right and because that
works on social media that look if if
Elon changed the
algorithm yeah just by taking himself
out of it seriously I'm not saying don't
post right post all you want but he you
know if you look at his followers um
they're almost all right leaning
if you look at the people he engages
with positively they're almost all right
leaning and if you look at the people he
engages with negatively like me right I
consider myself an an independent but it
I lean left on the Dei topic right um
that influences the algorithm and so you
see what you see because of what he says
yeah well I mean for sure but the the
there could be a lot of influential
people on on Twitter that influence the
algrim and all that kind of stuff I I do
feel it's not even about ideology where
you lean it's about like the algorithm
not prioritizing drama be like the the
the attention grabbing thing or the
lower lizard version of that where like
people just want the drama they want out
when I last read through all the stuff
on on their algorithm right maybe it's
changed Whoever has the biggest account
and gets engagement on that account
influences what people see the most yeah
I mean that's interesting I don't know
if that's to to the degree that's true
they
they've Prett sure it's still the case
pretty rigorous description of
What's um of the way the aor works it's
actually kind of fascinating there's
like clustering of people based on
interest right but I think they call the
nearest neighbor right approach and I
think that's what they do and so whoever
has the biggest account has the most
neighbors who in turn have their
neighbors and that's how they discern
what comes next but there's a clustering
still so like if you don't give a shit
about Elon you're not and you're not
following him yeah you're not you're not
going to have an influence he's not
going to have influence when you get a
break just create a burner account on
Twitter and see what who they recommend
to you Elon and not just Elon I mean the
people that Elon likes and I'm saying
that's not Elon saying add this person
add this person and suggest this person
this person this person I'm saying
that's what the algorithm is yeah there
should be transparency around that for
sure there is there is that's the whole
point right he knows his transparency
and he knows the impact that's why when
I say take yourself out of the algorithm
right don't include his account that
changes I think the output of the
algorithm well when he wasn't owning
Twitter he was one of the biggest
accounts if not the biggest account
already it wasn't but still like even
like the Kim well the Kim Kardashian
accounts whatever right it would I I
don't it wasn't open source to elon's
credit it is now so I couldn't see it to
know right so I didn't get the sense one
way or the other of one one element
being dominant over the other but
obviously conservatives felt that that
left leaning was more dominant back then
yeah I would love to see numbers on all
of this yeah you me both Dei everything
like this uh sometimes anecdotal data
really frustrates me it frustrates me
primarily because of how sexy it is like
people just love it's a great way to
describe it love a story and I'm like
God damn it this is not science this is
this it's not even common sense you know
well no I I I think anecdotal stories
often have a wisdom in them like no
doubt right you there's something to be
gained from from seeing there's a signal
there but like how representative is
that signal of the broader thing there's
a whole lot more noise than signal more
often than not all right so as I
mentioned Cost Plus drugs there's so
many questions I can ask here but uh
what's the big question what's broken
about our healthc care system there's no
transparency there and when there lack
of transparency leads to lack of trust
and when you can't trust the Health Care
System other than maybe your doctor
that's a broken system so what aspect of
uh the system that cost plus drugs is
trying to solve so the thing we're
trying to solve for is trust and the way
we feel we get there is through complete
transparency so when you go to cplus
drugs.com and you put in the name of the
medication if it's one of the 2500 and
growing that we carry we will first show
you our cost what we actually pay for it
then we'll show you our 15% markup then
we'll show the the pharmacy fill fee and
shipping and that's your total price and
that alone that transparency alone is
completely revolutionizing how drugs are
priced in in America today and it's led
to you know research being done
comparing our pricing to CMS um and ours
being cheaper you know then even the
government is negotiating etc etc etc
and so just that transparently
transparency loan has has had an impact
and saved millions of people hundreds of
millions of dollars or more and maybe it
results in more transparency in other
parts of the system too corre seeing the
business of it but uh what do the
so-called middlemen companies so the the
pbms pharmacy benefit managers thank you
CVS care Mark signas Express Scripts and
United Health's optim RX they control
majority of the market right what do
they do wrong they put profit over
everything right and they know in an in
an industry that's completely opaque
they can pretty much do what they want
and nobody gets to see what they're
doing in detail and so you know the
first thing when you um sign a contract
with one of those big pbms it says you
can't disclose any of this and the fact
that you can't be disclosed means they
could tell Lex's company that um they're
being you know they're getting a great
price and they're only being charged X
and they can call tell Mark's company oh
you're getting a great price and we're
charging Mark X Plus right but Mark
doesn't know any better because there's
no way to know the markup is not
transparent the cost isn't transparent
the markup isn't transparent you know
and you know there's different things
you know like I was just talking to a
company um in a presentation a couple
days ago and they took the step to
leave the big three pbms to go to a
rebate free PBM that was smaller um and
what they said led to the decision they
had a contract with the PBM for these
things called rebates right where
depending on the volume of medications
you buy they'll kick back to you um a
percentage of them and as it turns out
when they compared what was contracted
for to what they actually got they were
getting underpaid every single year they
just don't care right they'll take
products there's there's a drug called
Huma right and it is the number one
Revenue um drug um in the country and
there's also bio similar multiple
biosimilar but one we carry called usim
and Huma the the pre- rebate price is
about $8,000 per month and after rebates
depending on the size of the company
it'll be anywhere from $3 to $6,000 a
month you can go to get um your doctor
to prescribe that bio simler you simmer
and you pay
$594 but those big three pbms won't
allow their clients to um get youim
because they don't get a rebate on you
Sim so they'd rather keep a drug on
their formulary even though their
patients would save their customers
would save a lot of money they'd rather
keep a drug and exclude another because
they'll make a lot more money so the CVS
KARK spokesperson I think responded to
you uhhuh Phil
blando with with the usual
language that so deeply exhausts me but
I I was wondering if there's TR any
truth to it employers unions health
plans and government programs work with
CVS KARK precisely because we deliver
for them lower drug costs Better Health
outcomes and Broad Pharmacy access
through our true cost cost Vantage and
choice formulary initiatives we are the
leading Agent of Change Innovation and
transparency in the market that's a
whole lot of nothing so they they are
not transparent no no call them up you
go to Cost Plus drugs we'll give you our
price list of every all5 200 plus drugs
the actual cost the actual cost and what
we sell it for because it's just a plus
15% call up any of the big three
companies and ask them for the same
thing they're going to laugh at you it's
so bad in fact if you do business with
them right now and you just ask for your
claims data meaning you know how many
people use humra that we're paying what
are we paying for it they won't even
give it to you unless you really really
scream and yell at them and then they'll
charge you and take six months to get it
so like when we moved away from them we
wanted to get what our claims data was
to understand what we were going to be
facing they won't give it to us until
like six months later I forget the exact
amount but and then we they charge us
for it as well our own data on the CEO
front you you've said that CEOs don't
understand healthc care coverage it's
costing them big what what's what's the
connection between oh Cost Plus drugs
and companies so I can speak for my own
companies and the supply to all
companies big you know bigger companies
that self-insure because we self-insured
um when I finally when we started Cost
Plus I finally said okay it's time for
me to understand how I'm paying for my
healthc care for my employees and their
families and the first thing I looked at
was a lot of these companies use
employee benefits consultants and turns
out I was getting I was paying $30 per
employee per month which was millions of
dollars a year and they were just
sending us to the companies that paid
the biggest commissions I'm like how
fucking dumb am I right so I'm like okay
we're cutting that and then I looked at
our um medication our prescription deal
that goes through the pbms that we were
using and that the consultant connected
us with and I took a list of this was
early on in Cost Plus drugs list of the
generic drugs that we sold that cost
more than $30 that the Mavericks also
had purchased right we were able to get
that claims data and it turns out we
spent
$169,000 with that PBM one of the big
three pbms and would have cost us buying
from Cost Plus drugs
$19,000 and that's just a simple example
then I looked at the insurance side of
things right we self-insure um so there
weren't premiums per se but we were
getting charged
$17.15 per employee per month just to
use the network that they put together
for us you know providers hospitals or
whatever and I'm like all right are
there companies that won't charge us to
put together these networks turns out
there's a lot of them and those that
those insurance companies and those pbms
are also responsible for determining
what claims what what um what to
authorize and what to deny right so for
a drug it may be all right this is an
expensive drug but before they'll allow
before they'll say they'll pay for the
drug that your doctor wants to prescribe
for you you have to try these three
other drugs in what's called Step Up
therapy right to see if these other
cheaper drugs work or they're not even
necessarily cheaper they may just be um
being pushed because they're getting a
higher rebate and so I'm like that's
insane I want my employees to get the
medication that the doctors say is best
and so I didn't realize those were the
intricacies of how my health or where my
Healthcare dollars went there's not a
single CEO who does because that's not a
core competency that they need and the
CFOs that's not their core competency
and the HR people they contribute and
they understand it some because they're
dealing with the claims but they spend
most of their prescription drug related
time or healthcare related times trying
to get pre-authorizations approved so
you know your kid breaks their arm or
you have you you get sick and you go to
the doctor and before the doctor will do
a surgery or do whatever they have to go
to the insurance company get
pre-authorized and then they always say
no right and then you have to go back
and somebody has to argue for you and
that just eats up employee time because
you know I'm sick or my kid sick and
you're wasting my time eats up HR time
the CEOs don't know any of this right so
what I'm saying is one the smartest
thing to do is to get a healthcare CEO
at every company with over let's say 500
employes that focuses on all these
things you'd save a shitload of money
and two healthc care is your second
largest line item expense after
payroll and in some companies it's
hundreds billions of dollars right you
don't understand it and you're letting
these guys rip you off and it's because
these big CEOs don't understand it and
are getting ripped off that the industry
is the way it is because that allows
trans the the opacity to continue that's
fascinating
so so the mo most companies uh Outsource
offload sort of the expertise on the
healthcare side when they really should
be internally there should be an expert
that because it's the wellness of your
employees and their families cost a lot
of money it's yeah but if your employees
aren't healthy or if they're worried
about their kids and what is more
worrisome and detrimental to the
performance of a company right a Dei
program
or or having to go to HR and scream and
yell and explain and and your doctor
wasting their time doing the same thing
to get authorization for a surgery or
medication it's insane what made you
decide to step into this cartel like
situation uh where so much is opaque so
I got a cold email from a Dr Alex hansy
who's my co-founder he's a radiologist
by trade and a physicist and a smart
motherfucker um and he had a pharmacy
that he wanted to create a compounding
pharmacy that would manufacture um
generic drugs that were in short supply
because it happens all the time that
things aren't available I'm like you're
thinking too small we should do
something on a much bigger scale yeah
and then it was right around the time
they were sending the pharmacy bro
Martin scr to jail and so I was reading
up on that and he increased the price of
this drug der Prim I think it was like
7,5% or increased a lowcost drug to
$7,500 one of those and I'm like well if
he can just jack up the price to this
drug and charge more and get away with
it this has to be an incredibly
inefficient
market and so the question is why is he
able to do it and it was immediately
apparent that it was a lack of
transparency and so can we start a
company that is fully transparent with
our cost our markup and our selling
price and see if it works and so we went
for it and it took off immediately I
mean you you know you read a press
release from a company saying you know
they were creating a cost Advantage
Program basically pretending to
replicate us yeah we haven't been in
business two
years how insane is that did you get a
lot of pressure I mean I'm sure they're
very good at playing games like so
cartel type situations they protect it
feels like healthcare like very
difficult to get in there it very it do
I mean and the whole industry is an
Arbitrage but we don't work inside the
system we work outside the system and so
we don't work with those biggest
companies the biggest companies with the
most dominant control you know it's very
insulated and very controlled like you
said um we work outside them we won't
work with them and so because of that we
don't have access to every medication
because they've told a lot of the Big
Brand manufacturers that if they work
with us they'll take them off their
formularies or change the rebate
structure so that they won't be
prescribed
yeah it is dark but we'll get past that
right because there's a downstream
impact of all this in the rebates and
the greediness of those big three pbms
when you go to a local pharmacy here in
Austin right and let's just say you have
you have a friend here right that is on
Medicare or Medicare Advantage and they
go to a local pharmacy and they get a
drug that cost
$600 well in the insurance company that
$600 the pharmacy first buys that drug
for probably that price minus 5% so $570
then there's probably a co-pay by the
patient and that's probably $20 so now
the net investment that the pharmacy the
local pharmacy has for that Med brand
medication is
$550 where it gets really fucked up is
those big three
pbms they're not reimbursing them $550
or more they're reimbursing them $500 or
less
less and literally those Community
pharmacies are eating that loss and as a
result they're going out of business
left and right and the most insane part
of it is yes with corporate um employer
insurance that happens but it happens
more with Medicare Part D and Medicare
Advantage it happens all the time with
those almost with every script so the
government is complicit in these
Community pharmacies going out of
business so how does that uh how does
that connect to Cost Plus drugs and what
we're doing and the big Brands the big
Brands know that if all these Community
pharmacies are going tens of thousands
of them are going to go out of business
because of the way this pricing is
they're going to lose a connection
between their brand medications and
Grandma and Grandpa and aun Sally and
all those all that business is going to
get transferred to the big companies and
they're going to have even less leverage
so they're working with us to come up
with programs that are very supportive
of independent pharmacies and that's
going to allow us to break the cartel
because it's in their best interest not
to allow them to be so vertically
integrated that they destroy the entire
community and Independent Pharmacy
industry is there other aspects of the
healthcare industry that could use this
kind of yes transparency and
revolutionizing yeah so what we're going
to do with our own health care right
we're not going to be in the business of
selling healthare or anything like that
operate but the things we do for my
companies we're only going to do deal
with um providers healthcare providers
that allow us to be completely
transparent so that whatever contracts
we do we're going to post them all
whatever pricing we get we're going to
post them all so that every company
who's our size or even bigger will have
a template that they can work on which
will take it away from um the the big
three insurance companies and the big
three pbms because now without that
transparency they have to use
Consultants who are getting paid by
those big three you know those big
companies and aren't giving them the
best um response and so now that
transparency will overcome that and
you're using your how to should I say it
celebrity your name yeah to kind of push
this the only company I've ever put my
name on it's weird that people aren't
getting into the space like will you
public people you know like big there's
not like a big you know you look at Tech
there's like these like like CEOs or
open and public and public and they're
pushing the company and they're selling
everything it's like we're all
transparent
uh but you don't see that in in
healthcare no because it's a big
business and most people like if I was
25 trying to start a company I'd work in
the system because if I can build it up
big enough they would just buy me and
I'd make you know money and buy a sports
team but I don't need that money now uh
let me ask you about AI you got a little
bit of an argument about open source I
think you stepped in between uh vano
Coen Mark andri you think AI should be
open sourced yeah for sure so like all
that discussion we've been having about
like Google and so on one of the two
different things meaning that um meta is
doing open source yes right that's a
good choice for them I think that's a
smart choice right but it's just a
business decision for everybody else I
don't think it should be forced forced
yes yeah I even Google's open open
sourcing some of the models and because
they're all that's a very incestuous
industry where you know the people all
work together at some level they read
the same papers they go to the same
conferences you know it's like the early
days of streaming and the internet where
people Ed the same technology everywhere
and now they just try different things
and you get one smart or two a couple
smart people in one company like anthrop
anthropic right and they do things a
little bit better and effic model
efficiency gets better so you know it's
just a business choice but I don't I
don't think it should be forced but I
think it's a smart business decision
open sourcing is a smart business
decision yeah it's a tricky one I mean
Google is a Pioneer in that with tensor
flow on in the AI space that's a tricky
decision to is right but go back to
historically you know there was digital
Computing which was a dominant player
and they thought and IBM to a certain
extent um thought that they wouldn't be
subject to a problem with the PC
industry and then all of a
sudden and in with their their main
frames and everything they had captive
software they wouldn't use offthe shelf
software right so for a digital
equipment Mainframe or an IBM Mainframe
you needed software that was written for
it there was nothing off the shelf and
when the PC industry came along it was
the exact opposite there was you know Ms
Doss and then Windows things that were
off the shelf that every PC could use
and that changed how people thought
about software and I think the same
thing will happen here where it's going
to be um as models become more efficient
and easier and less expensive to train
um I think there'll be more more reasons
to open source yeah that's the hope it
creates more competition and a lot of
different
diversity of
approaches uh in how they're implemented
deployed what kind of products they
create all of that V compared the danger
of that to the Manhattan Project that
yeah I yeah I'm not buying that at all
you don't see the parallels between
nuclear weapons and no no I I I think
I'm not an AI fatalist at all right I'm
I'm an AI Optimist and but but it's not
to say that there isn't a lot of scary
shit that can happen with it militar
um you know like I said earlier I'm a
big believer that there's going to be
millions and tens of millions of models
and people will take their expertise and
either get hired for it um and
contribute or create their own models
and license so that you know you see now
with this thing called mixture of
experts right where you you connect
things and and um people can take their
expertise and will be able to take that
expertise and retain it in a way that
they want to retain it so you know I
don't think there's going to be one
medical database I told this to people
at a couple big companies that were
doing Healthcare
initiatives I there branding is so
important in the healthare space if you
know for hospitals you know the Mayo
clinics the MD Andersons they're huge
Brands and I don't think they're just
going to give up their expertise to some
you know main singular model you know
and say okay you know whatever expertise
we have is available to you in gemini or
chat gupt or you know so and so's
version of of meta's Open Source I just
don't I there's just that would be
business suicide um and so I think
you're going to see each of them have
their own models and update them as they
go and license them yeah and yeah make
money from the expertise don't give away
yeah yeah yeah and the expertise evolves
and grows and all that kind of stuff and
you want to own that growth uh what
advice would you give give to young
people you have an exceptionally
successful career you came from Little
made a lot what advice would you give
them love your life right you know find
the things that you can enjoy be curious
you don't have to have all the answers
when you're 12 15 I get emails from 13
15 year old kids right what do I do what
do I do right you know I feel like I'm
being held back I'm like a 15 you feel
like you're being held back um but just
be curious because you don't have to
have the answers you have to know what
you're going to be when you grow up I
I'm a hardcore believer that everybody
has something that they're really really
really good at that could be world class
great every single human being on this
planet and the hard part is just finding
what that is and in in some places
having resources to enable it um but be
curious so you can find out what it is I
didn't take a techn I took one
technology class in in College Fort Tran
programming and I cheated on it right I
I mean it wasn't until I got a job at
melon bank and I started learning how to
program in this thing called RIS this
the scripting Computing language that I
realized oh this is interesting to me
and I like it and that's what got me you
know a job selling software and and the
you know going on from there you just
don't know what that's going to be until
you go out and experience different
things So for anybody young out there
listening you know enjoy your life find
things to smile about be curious read
watch you know expose yourself to as
many different ideas as you can because
something's going to click at some point
you may be 15 you may be 25 you may be
55 but it can happen one thing to
mention is that sometimes it's difficult
where your parents people around you
might not be U conducive or might not be
a of help in finding the thing you're
good at in fact like in my own life you
know the society was such that I don't
know if they've help much at the thing I
was good at I'm still not sure what that
is but I think I think interviewing done
pretty well for you well it's not even
it's uh there was a
thing where I saw the beauty in people
like I it very intensely so you can call
it empathy all that kind of stuff and
someone call it
wokeness super woke I guess you could
say just super woke that's me uh and you
know but in the education system I I
came up in is it was a very hard
mathematics you know science and so on
and it didn't notice that whatever that
was and and mean but you know you have
to keep the flame going you have to try
to find your way and see what that's
useful and and like others around you
might not always notice it so it might
take time so it could be lonely you can
really have to find the strength to
believe in yourself oh for sure you know
and I'll tell you one quick story um
1992 I went to Moscow State University
um to teach kids how to start businesses
wow CU I sold um micro Solutions and I
wanted to travel and I took Russian in
high school my risky is like not show
um good enough to remember that yeah
right yeah um but it was interesting to
me and I bring it up because just they
didn't they didn't know what the word
profit meant right but at the same time
I would go around and meet people and
there were it was as entrepreneurial
like right after the the the Soviet
Union fell entrepreneurship went through
the roof I mean a lot of it was Mafia
driven but you know it was people found
that spark you know because I think that
that is natural um and so you just never
know when and how and when the
circumstances will come together for you
to be able to take advantage that spark
is really important to comment on is in
Russia and UK
brain uh I think the system kind of
suppresses that spark somehow because
you said you saw the natural
entrepreneurship but there's not the
entrepreneurial Spirit once you grow up
in both of the Nations I mentioned there
is I believe it Ukraine but there's
something about the system that kind of
you know be reasonable be you know be no
reason for me to go over to do what I
was doing if it if it was otherwise
that's the thing that really can help a
country flourish you know it's going to
be interesting with Ukraine if they're
able to survive this right because as
horrific as it is you know as you saw
across Europe after World War II um the
rebuilding creates
opportunities rebuilding creates
opportunities but you know first the war
has to end how that ends I don't know
either is a really complex path what
gives you hope about the future of
humanity um just looking in my kids eyes
just you know talking to them seeing
their Spirit their friend spirit and
obviously we're blessed as can be right
and it's not the same for every kid but
I do you know I get emails that I
respond don't respond to all of them but
from 13 14 15 year old kids around the
world you know because shark Tank's
shown everywhere a asking me business
questions and it's just like they took
the time they were that curious and that
interested and I see it when I talk to
schools you know when I go to different
groups
um that spark in kids eyes that there's
something bigger and better and exciting
out there and that's not to say there's
not fear you know climate and any other
number of things but that's the beauty
of of kids and and I think gen Z really
embodies that and to me that's just
really exciting they dream they dream
big they see the opportunity for making
the world better it's cool it's cool to
see young people and that in their eyes
that dream that and I could be the one
to do it too which is a you know that's
funny because I when when I go talk to
like elementary school kids right one of
the things I do I said okay let's look
around you see that light there one day
that light didn't exist then somebody
had the idea then somebody created a
product of it and now your school bought
that you see that chair chairs didn't
always look like that somebody had that
idea why not you so when you walk out
and what I make them do ask yourself why
not me why can't I be the one to change
the world thank you for that beautiful
hopeful message and thank you for
talking today Mark you're you're fun uh
to follow I'm a big fan of yours but
you're also an important person in this
world I really appreciate everything you
do well I appreciate thanks for saying
that Lex and keep on doing what you're
doing this was great I really enjoyed
this thanks for listening to this
conversation with Mark cubin to support
this podcast please check out our
sponsors in the description and now let
me leave you with some words from Oscar
Wild
imagination was given to man to
compensate him for what he is not and a
sense of humor was provided to console
him for what he
is thank you for listening and hope to
see you next
time