120 – Trump Slashes Thousands of HHS Jobs, Quantum Breakthrough, & Zuckerberg’s Robot Gamble!

[00:00:00] Marcus: If you enjoy this content, please take a moment to rate and review it. Your feedback will greatly impact our ability to reach more people. Thank you. All right, Vic. How's it going? Going well. Glad you're back. 

[00:00:11] Vic: You came back to snowy Nashville, 

[00:00:13] Marcus: though. Yeah. Yeah. But it's, it's, it's a, it's a pretty snow. You know, it's not like rainy, nasty.

[00:00:20] Marcus: The sun is out. It's not too, too gray out. It's nice. 

[00:00:24] Vic: So how was, uh, we tried to keep it going here, but I want to hear about Saudi Arabia. 

[00:00:28] Marcus: How 

[00:00:28] Vic: was the 

[00:00:28] Marcus: trip? Uh, it was mind blowing. Absolutely mind blowing. Um, you know, I, I think that Saudi Arabia is probably, uh, top three places where the American narrative versus reality gap is, is, is like just ridiculously wide.

[00:00:48] Marcus: Um, and, and, and, you know, credit. Just credit to us on that. I would say the narrative we have is not necessarily wrong. It's just old and [00:01:00] Um, the kingdom of Saudi Arabia is advancing so quickly. Um, cause they have this thing called, uh, Saudi vision, 20, 30. That, uh, that the King and his Royal Highness put together 

[00:01:14] Vic: building of entire cities and it's huge.

[00:01:17] Vic: Yeah. 

[00:01:17] Marcus: Yeah. Yeah. They've got these massive giga projects, right. That they're doing. Okay. And, um, the, the, the thing that you realize pretty quickly is. The fundamental difference between a society that, um, does not run by democracy versus one that does. Right. So we have this democratic society and, you know, we're thrashing around.

[00:01:46] Marcus: We're thrashing around like. Constantly about partisan stuff. And it just kind of spins up, spins up and don't get me wrong. I'm not saying like anything is wrong with democracy. I'm just saying like, you know, there's trade offs, right. [00:02:00] You know what I mean? So in the democracy, this is what you, you know, you have a lot of the scratching around.

[00:02:04] Marcus: Yeah. So in a, you know, in a kingdom, the key is really like, do you have benevolent leader or not? Kingdom 

[00:02:13] Vic: king 

[00:02:14] Marcus: or not. Yeah, yeah, it is, it is completely boils down to like, is the king, you know, benevolent or not, right? And, um, you know, look, I think the Saudi people would say they have, they have benevolent kingdom right now.

[00:02:28] Marcus: Um, and so they have this, this 15 year strategic plan called Saudi Vision 2030. They're 10 years into the 15 year plan. You know, we can't have a 15 year strategic plan in America. Yeah. Yeah. You know, so they have this 15 year plan and they're 10 years in, and it, it has all of these really thoughtful, um, you know, societal and economic, um, And, uh, you know, foreign policy [00:03:00] aspects to it, but about health care access building, you know, these, these giga projects, whole just super modern cities, um, as it pertains to us, they are completely revolutionizing their health care system, um, you know, and.

[00:03:17] Marcus: So many of, uh, so many of the, the ministers, uh, and, and the people who work for the ministers, you know, across the, their government, um, were educated in the United States. So. The direction they're going with their healthcare system is, I think, one that, not all, because we know that there's not one camp in America around where we should go with healthcare, but it's, it's one that I think a lot of people in America who are in the healthcare industry believe we should be going towards, that they are basically moving to 100 percent privatized ACO model.

[00:03:52] Marcus: Um, so we're, we're already privatized when it comes to, you know, delivering care, they have their own version of the VA there, right? So. They [00:04:00] have health care for the, you know, the veterans and people in the military, but outside of that, the whole population is cared for by sort of the ministry of health.

[00:04:08] Marcus: Um, and right now it's just like they, they pay for it. They're not, you know, they don't do cost accounting. They're not tracking it. It's, it's not a, it's not a fee for service thing. It's just a, whatever it costs will pay. So it's kind of like. Cost plus maybe, but it's all, but the, but the providers are the government as well, right?

[00:04:26] Marcus: Like today they have private hospitals. Um, like they just had their first, like HCA just launched on the, on their stock market. Um, but for the most part, it's, it's UK or London or something, you know? Yeah, yeah, yeah, yeah, yeah. But I, but I would, I would say not as advanced as like NHS. Yeah. Okay. Yeah. Not as advanced as NHS, but where, but where they're going.

[00:04:52] Marcus: Is going to be more advanced, right? Because, because they're, they're leapfrogging all the models that in the Western world, especially like, you know, [00:05:00] UK United States that we've like tried and, and now we're kind of trying to back out of a little bit, you know, um, they're just going to this a hundred percent.

[00:05:08] Marcus: Cluster ACO model. They have a lot of work to do to figure out revenue cycle and cost accounting and all that kind of stuff, but it's all going to get privatized over the course of the next 10 years. And they've got it, you know, pretty well phased out. And, um, it's just, it's, it's super ambitious, but when you look at all the other things that they're accomplishing, um, The building of their financial district, their whole health tech city that they're working on, it's, it's like, you get that they are much further along in the process of, um, getting away from oil dependence.

[00:05:38] Marcus: Um, then, then we might think they are right. Like, I feel like the story in America has largely been around sports washing, because this is what, this is what we interact with. Right. You know, live golf and Ronaldo, you know what I mean? And just like boxing, 

[00:05:53] Vic: right, right. 

[00:05:54] Marcus: Boxing. Right. Yeah. So like, that's what we.

[00:05:56] Marcus: That's what we get to see and feel from Saudi is like [00:06:00] the sports part of it, but for, for the, the citizens, it's, you know, it's a full societal upgrade is what they're going through. It 

[00:06:11] Vic: sounds like maybe a lot of the people that work in the ministry of health were educated in the U. S. and they're able to take kind of best practices globally, and then they have.

[00:06:22] Vic: a king who can say, well, let's build it this way and just start now. There's a lot to build, but that's kind of freeing just to let's go build how we want it to be. 

[00:06:32] Marcus: Yeah. Yeah. And the crown prince is apparently, I don't know him. Um, but the crown prince is apparently, you know, very ambitious when you look at the plan, it's clearly very ambitious, but, but also like we are going to hit these things.

[00:06:44] Marcus: And so, you know, a couple of other things I'll just point out. Um, the advancing of women in that society, I think it's, it's happening so quickly that it wouldn't make sense that any [00:07:00] American narrative could keep up with it. You know what I mean? Like, like I, I, when I talk to people here, especially coming back, mostly they talk about women being able to drive.

[00:07:11] Marcus: And some women being able to do some jobs, but like it's, the shift is far more impactful than that. 

[00:07:20] Vic: So when you walk around, you went to a conference, I think when you walk around, there are women, they're just like men, just like in a U S conference. Oh 

[00:07:27] Marcus: yeah, for sure. Absolutely. Absolutely. Now their society is much more, um, There's no question.

[00:07:35] Marcus: It, it, you know, it, uh, it's a, it's a, it's a nation under Islamic law, and so, uh, you know, every, they're just not, uh, everything is formal, you know, it's a much more formal place. I wore suits basically every day that I was there to do business. Um, you know, that you, you don't generally like reach out to shake a woman's hand [00:08:00] unless she extends her hand first.

[00:08:01] Marcus: So there, there's a formality to it and a modesty to it. Um, that is just, it's just baked into the culture there. It's, it's, it's, it's their fundamental culture and they're not like losing that part of it, but many, many women without, you know, um, headdress, um, now men and women are working on the same floors in buildings.

[00:08:21] Marcus: I think even like two years ago, that wasn't the case. They were, they were working on separate floors and buildings. So, um, there's just all these things that are advancing very, very quickly. Um, women, women are, are entrepreneurs. Like, I think that's one of the big things that's happened in there. Many, many women are CEOs of companies and, and entrepreneurs.

[00:08:38] Marcus: And so, um, yeah, it was, it was, it was really, really impressive and inspiring in, in a lot of ways. Uh, the delegation was timed around, uh, a large event that they have there called leap. And I had never heard of leap. Yeah. Yeah. You didn't know about it. [00:09:00] Right? Yeah. So leap for, well, first of all, it's, it's thrown by informa, which is that big event company that like they, they just bought hymns, for example.

[00:09:10] Marcus: So they, so they throw big events all over the world. So that gives you a sense of like, okay, how big are they going with this thing? Right. It's pretty, it's pretty significant. It's pretty significant. And, uh, and the event had hundreds of thousands of people there. Hundreds of thousands. Yes. 

[00:09:28] Vic: That's bigger than any event.

[00:09:29] Vic: Maybe CES is that, but there's no events that big in the U S 

[00:09:33] Marcus: it was like CES. And, and by the way, not just in people, like the quality of the booths that were there, CES level for sure. And then the final thing I'll say is, um, this was probably the starkest thing for me. You know how there's kind of like this refrain around in America, when you're talking about investing and people will be like, you know, [00:10:00] would you take Saudi money?

[00:10:01] Marcus: Like, like you've heard that before. Yeah. Yeah. I mean, Right? It's, it's, it's, it's, it's just always like a question that, that like, that like people will, will, will say. Right? Um. American corporations have been in Saudi Arabia for a long time, very well established, very integrated, you know, large, large consulting groups are deeply embedded, collaborating with the government on the Saudi vision 2030.

[00:10:31] Marcus: There was a raisin canes there. You're saying, I don't know if that's good or bad. Maybe it's good for health care. They're going to need, but you get the point, right? I mean, yeah. So anyway, um, I just thought that it was, uh, 

[00:10:48] Vic: and, uh, the UAE. It is already a global center, certainly going to be a global center for commerce, for everything.

[00:10:56] Marcus: Yeah, there's no question about it. Um, they have an [00:11:00] ambition to double their population. Um, and I think they're going to have two very big sort of coming out parties. They have the World Expo in 2030 and then they have the World Cup in 2034. So, um, you know, the world will be going to Saudi Arabia to sort of see all of their progress here pretty soon.

[00:11:18] Vic: Excellent. Well, I'm glad you went and I'm glad you're back. 

[00:11:21] Marcus: So yeah. Yeah. And honestly the travel in and out, there's a direct flight from DC. Uh, it's like kind of like going to Europe really. 

[00:11:31] Vic: Yeah. 

[00:11:32] Marcus: Yeah. It was no problem. It was no problem. So anyway, uh, I'm glad to be back as well. Uh, it was a very intense two weeks.

[00:11:39] Marcus: I had a trip on the front end of that and a trip on the back end of that. Um, you know, came back, finally got sick, but at least I was home when I got sick. So that's why we're not in the studio right now. Um, but yeah, look, it was, it was fascinating. Um, I made some great friends and, uh, and I'll be going back, you know, um, I'm going to go 

[00:11:58] Vic: check it out too.[00:12:00] 

[00:12:00] Vic: Yet for yourself, it's hard to, like you related to me, but it's, it's different if you're walking through the city, like just experiencing it. 

[00:12:07] Marcus: It's, it's, it's definitely something that I would encourage you to do. And I certainly would encourage other people to, um, To go see, see Saudi Arabia. Okay. Uh, anything else or you ready to go?

[00:12:21] Marcus: I'm ready to go. All right. Let's dig in.

[00:12:33] Marcus: All right. First, let's start with the, uh, with the fed fed minutes were released after the latest meeting and, uh, what did they say? 

[00:12:38] Vic: It basically says they're taking a wait and see approach. So they were pretty aligned in the meeting, in the minutes of the meeting. That they want to just see how the data comes in and they're not in a rush to cut rates or raise rates, right?

[00:12:54] Vic: So the market really reacted positively to those minutes, not that surprising, but [00:13:00] it's good to keep following the Fed because they, you know, move things around. 

[00:13:03] Marcus: Yeah. Yeah. I mean, not, not, not surprising. Um, and also they've. Put in minutes here, something that is not necessarily aligned with, uh, what president Trump, um, is hoping that they will do so that that's a, that's one of many storylines we'll need to continue to track.

[00:13:22] Marcus: Yeah. Moving on next, uh, to the VC section, AI healthcare startup, open evidence raises funding from Sequoia at 1 billion valuation. So is, is this a new thing? Like we're now going to call all the AI companies open something, even though they're not actually open source. 

[00:13:38] Vic: So I don't think it's helpful, but yes, they're open, whatever.

[00:13:43] Vic: Um, the thing that I was shocked about is they claim, well, first of all, it's a, it's a, it's a unicorn, you know, immediately right away at a billion. Um, and then they claimed that a quarter of doctors in the U S [00:14:00] are using the tool, which I do not believe, but it's in the story. There was a lot of press around, around this.

[00:14:09] Vic: So, 

[00:14:11] Marcus: you know, you know how I feel about hyperbole and failure to be precise. 

[00:14:15] Vic: Yeah. Yeah. So it is, uh, you know, it's a, it's an LOM designed for healthcare. And I think because of that, it is, you know, likely better suited to help in healthcare settings, but I think that it seems. Overvalued and a lot of hyperbole, but Sequoia is, you know, Sequoia used to be an incredible brand.

[00:14:44] Vic: They're still a good brand. I think they've lost a little of the shine, but a good brand. 

[00:14:50] Marcus: Yeah. I mean, I just feel like decision support for physicians. Valuing that at a billion dollars just [00:15:00] feels it, it, it just rhymes with olive. That's all I'm going to say. It rhymes with olive. Yeah. That did not end well.

[00:15:10] Marcus: Uh, Axios pro Frontera health gets 32 million for autism therapy tools. This is also AI, and this is addressing the backlog. of ABA providers that are available for families who, um, need therapy for their children. Um, basically while they're on those waitlists, they can, uh, supplement the, the absence of, um, therapist availability with an AI powered assistance for 

[00:15:37] Vic: Yeah, 

[00:15:37] Marcus: so I 

[00:15:38] Vic: think the opposite about this.

[00:15:39] Vic: I mean, I think, uh, An in person, uh, uh, helper, PT, or, or support for your child is, is better, is the standard of care. But if you can't, if you're on a wait list and you can't get help, it seems like a good solution to, to have an adjunct additional tool to help. [00:16:00] 

[00:16:00] Marcus: Yeah, yeah, I, I think so. You know, we, we've, we've got a, um, VA company in the, in the portfolio and there's, this is definitely a space where there is so much room for improvement.

[00:16:12] Marcus: um, you know, uh, all, all the way around, uh, we have, we, we have a very hard time figuring out how to. Move the needle on outcomes in this space. Uh, and so right now it's largely a consumption model, you know, because we have a growing number of the population that are being diagnosed with autism. Um, they, they have special needs.

[00:16:37] Marcus: They, they do need support. The healthcare industry is sort of, uh, bound to, to provide for them, but there's no pathway from, there's no therapeutic pathway to quote unquote, improve. Right in a meaningful way that would that would be that would show up via diagnostics that would lower the cost of care, you know, so it's basically like, how much availability do [00:17:00] you have?

[00:17:00] Marcus: And we fill all that availability and then we pay, but then we pay pretty low rates because we can't control the cost. So that impacts, you know, the quality of the therapy providers. And you sort of cycle around. Yeah, exactly. You got it. It's just this loop. So we definitely need to figure out how to improve, uh, autism care.

[00:17:20] Marcus: No question. 

[00:17:22] Vic: Yeah, and adding, I mean, if a patient's on a wait list, there's no question that an AI tool is better than nothing. And so I think that's a great way to sort of enter the market. As opposed to some kind of replacement or, or other alternative. 

[00:17:38] Marcus: Yep. Agree. Agree. Axios Pro, again, posterity collects 13 million Series A for male fertility.

[00:17:45] Vic: Yeah, so male fertility is less, uh, covered, but I think it's about half the cases where you can't have a baby. So, you know, it's, it's It's as important as female infertility. Um, and we know several of the [00:18:00] investors in this company, SCA here in town and skills, steel side, uh, we know. So it seems like a good, good company.

[00:18:07] Vic: I don't know much about it, but I liked the space. 

[00:18:09] Marcus: Yeah. And I like the investors. So happy for FCA and, uh, and Maria it's still Skype. Um, okay. Moby health news, Millie secure us 20 this paternity care platform. 

[00:18:19] Vic: Yeah. So this is, uh, after you get pregnant. Uh, and so the maternity, you know, maternity care and then, uh, after the baby comes to, so it's a, it's a good space.

[00:18:30] Vic: Um, and I think, you know, a series a, I like to see series a new companies getting, getting going. 

[00:18:37] Marcus: Axios Pro. X, X redesigned health director debuts. Terrarium incubator. So this is company ventures. Our friend Hunter, uh, is, uh, is one of the partners over there and they have backed with 130 million, a new healthcare, uh, incubator called Terrarium.

[00:18:54] Marcus: The CEO is Mark Rosenblum and, uh, he was from Redesign Health. 

[00:18:58] Vic: Yeah. And they, [00:19:00] they are partnering with, uh, Wellstar and then a design firm called Cactus that I don't know, but. But that whole concept of sort of the studio aligning with a health system and a design shop, uh, I think makes a lot of sense. And so, uh, good to see the former redesign director landing in a new place, Terrarium.

[00:19:22] Marcus: Yep, yep. Okay, so So Eli Gil, uh, sort of a thought leader, um, in the industry, uh, writes on a variety of different things. Um, but he wrote a post in, on February 5th, uh, called Leaving Delaware. And this is when I say industry, I mean, tech industry, not healthcare industry. This is a guide. That many people, including, um, biology are referencing on this is the go to for how you set up your company without setting it up in Delaware, because, uh, there are people who believe based on [00:20:00] some of the court cases that have happened over the course of the last 23 years in Delaware, the Delaware is no longer.

[00:20:06] Marcus: Um, the best place to incorporate your company. This is a pretty big shift. I mean, I don't think I want to talk about what's inside of the post as much as I want to talk about this, this real shift that's happening. Um, we have talked about the shift from. Uh, from an economic perspective to the Southeast United States, uh, Texas, Florida and Tennessee in particular, um, three states that have grown in prominence and power economically across the United States significantly over the course of the last five years.

[00:20:38] Vic: Nevada has really been aggressive at, they don't have, you know, no income tax, but, but they've been really aggressive at this corporate. Exactly. 

[00:20:48] Marcus: And so now, um, Texas and Nevada are emerging as new legitimate alternatives for establishing your, your C Corp. And the reason why that is such a big [00:21:00] deal is I, you know, talk about things that for someone like me who came into this industry, you know, you were like teaching me the industry and setting up a Delaware C Corp was like a, it was like a law of physics.

[00:21:11] Marcus: You know what I mean? That's 

[00:21:12] Vic: just 

[00:21:13] Marcus: one of the things you 

[00:21:14] Vic: You did, right? You set up your C Corp in Delaware, and then you started building. There was no alternative. I mean, it wasn't, and, um, I think it is, it's just, to me, it's a sign of the fractioning of really our population to different states based on tax policy, legal policy, political persuasions, cultural things.

[00:21:40] Vic: There's definitely a a fracturing, maybe that will be healthy if we can experiment with things and come back together. It also could be really damaging and not good. I'm hopeful, but nervous about it. 

[00:21:55] Marcus: Yeah. I mean, it's, it's going to make [00:22:00] our industry that I believe is already challenged a little more challenging, just a little more challenging.

[00:22:08] Marcus: Um, because I think the reality is we're going to see. Uh, different VCs start to say, I'm doing all my stuff in Texas, or I'm doing all my stuff in Nevada. And now you're going to have three different places and, and, and I, and I think it's going to largely split along like political ideologies 

[00:22:27] Vic: and, and, 

[00:22:28] Marcus: and we know that a ton of VCs right now are on the red train.

[00:22:32] Vic: Yeah. I mean, Sally, Peter Thiel and others. Sort of maybe they saw the momentum and jumped on for financial reasons. Maybe they always believed in these ideals. I don't think it really matters. So a lot of the venture capital industry and the tech industry has sort of. Signed up on the, I don't know if it's red or just Trump, but, uh, that's kinda the same thing now.

[00:22:59] Marcus: [00:23:00] Yeah. I, I, I, I I think it's red. Yeah. Yeah. I, I I think it's bigger than, I think it's bigger than Trump. I think it's, you know, I, I think it's the, the GOP. So look, th this, this will be for, for us in our industry, you know, if you're outside of our industry, you know, you just like a healthcare person listening to this, you might not care about this, but for, for the, for the VC industry, this is.

[00:23:19] Marcus: It's not a small deal. 

[00:23:21] Vic: And for founders and management teams building that you have to decide now where it's just another thing to consider. There's more optionality, but there's also a lot more complexity. 

[00:23:30] Marcus: That's right. That's right. All right. Uh, and then the final thing in the VC list here, wall street journal, the new survival guide for private equity, go big or get back to basics.

[00:23:40] Marcus: So what's, what's kind of the narrative here? 

[00:23:43] Vic: Basically the, um, the private equity. Industry is sort of bifurcating to, um, you know, huge private equity firms. It used to be that 5 billion was a big, big private equity firm. It's not now and they're getting [00:24:00] bigger and bigger and bigger. Or you really have to go back to, uh, finding deals and, and, uh, kind of manufacturing things really small.

[00:24:09] Vic: There's not that middle of the road. Um, so, I mean, they, they call out, uh, CDNR who, you know, we're friends with several of them there. Um, with their, their $16 billion fund. Um, and it's just, that's just part of the game now. You have to be, you have to be raising that, you know, significant, um, size in order to, to play.

[00:24:36] Marcus: Yeah. Well, I, I mean, I, I think, I think they called out cd and r as actually being more of the pure play that is just excelling with a not so large fund, which is crazy to say. 26 

[00:24:47] Vic: maybe that's 

[00:24:47] Marcus: small. Yeah. It's crazy to say 26 billion or 16 billion is, is. Small, right. But, um, relative to, you know, $3 trillion that some of these, uh, firms are sitting on.

[00:24:59] Marcus: [00:25:00] Uh, and, and look, I, I feel like the same thing is happening at vc, right? I mean, you know, we, we've, we've got the general catalyst of the world. We've got the entries in Horowitz, I mean. You know, jumpstart will never raise the kind of capital that, that those funds raise. And I actually, I just got finished writing, um, you know, my LP update, because I've been sick and, you know, family stuff happening.

[00:25:20] Marcus: Uh, but I just got done writing it and you know, the narrative is like, Hey, listen, if you're a seed stage fund, you better be a builder. You like you on helping and adding value, you better be a builder. Like you better be in there rolling up your sleeves, helping these companies actually become real companies.

[00:25:41] Marcus: Like, don't think you're going to be peddling a narrative, doing moment of crap, you know, while they, while they burn cash. And somebody is going to save you. Do you, do you know, like two years in a row graduation rates from the norm? Like, and I'm not talking from 2020 from the norm, it's cut in [00:26:00] half. 

[00:26:00] Vic: Yeah.

[00:26:01] Vic: Well, so let's talk about graduation rates. Cause I'm not sure everyone understands that graduation from seed, you raise a seed round, do you graduate to the next round called what you mean? It's cut in half. So as many companies are. And that means one, one in five, 

[00:26:20] Marcus: one in five. 

[00:26:22] Vic: And so I think a seed general partner or seed fund has to be able to contribute.

[00:26:29] Vic: You have to help build customers, you know, new revenue sources, help them raise money, help them with their strategy. You need to be sort of hands on 

[00:26:40] Marcus: honestly, like. If you have a one in five chance of helping them get to a series a you're way better off spending your and also like one in five. Is not evenly distributed, right?

[00:26:56] Marcus: If you're not in California, 

[00:26:59] Vic: It's lower [00:27:00] than that. 

[00:27:00] Marcus: Far lower than that. It's like 1 in 20, right? So, so, so now, what you're actually charged with doing is not just driving top line revenue, but creating a capital efficient business that is very close to, if not cash flow positive. 

[00:27:18] Vic: Yeah, you have to get to default alive, meaning you have more money next month than you had this month.

[00:27:24] Vic: That's right. 

[00:27:26] Marcus: That's it. You're not in a position to just burn cash nonstop. And that's what I feel like they're likening CDNR to here. They're saying they're very, very good at pure play buyout, get in there, get this company operating efficiently well. They're growing top line, but they're also improving bottom line, right?

[00:27:50] Marcus: And that's, that's what we got to do. Yeah, 

[00:27:55] Vic: those days of uh, i'll hang around and follow some other [00:28:00] vc and just get a momentum train is gone Over 

[00:28:04] Marcus: over for most of us. Anyway, okay moving into policy. Uh, the associated press Hhs is losing thousands of workers under trump administration probationary job cuts So I I think the last time I looked at the counter and this was two days ago But I I thought we were up to around three hundred thousand Was it 300, 000 or was it 30?

[00:28:25] Marcus: 30, 000? At HHS? Uh, uh, Jo Jobs lost. 

[00:28:34] Vic: Yeah, I don't know. Uh, across the federal government, this story talks about 1300 at CDC and 5,200 across all of HHS. It's per perspective. This came outta the article. It just has about 80,000, uh, employees total. And, uh, doge and the Trump administration have been attacking these, this probationary status.[00:29:00] 

[00:29:00] Vic: I think because that's the easiest place to do effectively a layoff or whatever they're calling it, um, and once they are not in probation, I think you're in probation for a year after you start or a year after your title changes, whether that makes sense or not, I don't know, but that's the, that's how it's set up.

[00:29:20] Vic: And so those are the people that, um, are being terminated or being laid off, whatever the term is. 

[00:29:27] Marcus: Yeah, uh, I mean, this was 1, 300 probationary employees at the CDC, which is roughly one tenth of the agency's workforce. Um, I mean, they just 

[00:29:45] Vic: I mean, I think you and I understand what Elon is doing, because he did it at Twitter, now X.

[00:29:52] Vic: Sure, I mean, I get it in the private market. Yeah, well, well I don't know that it's appropriate for the [00:30:00] government to do that process, but that's the game plan he is using where, and I've done it before, where you come into a private company that is in trouble and burning money and that has very limited prospects and you have to cut enough employees to really make a difference.

[00:30:19] Vic: You always end up cutting slightly too much. Because it's easier to hire back the one or two roles that you cut too much in. Um, that's pretty common in private companies that are in trouble and trying to cut back their costs. We've never seen it tried in a, in a government, never mind the size of the U.

[00:30:43] Vic: S. I don't know how it's going to end. I mean, it, it might be okay. It, it might be There's 

[00:30:51] Marcus: definitely nobody knows. No one knows. Nobody knows. Nobody knows. Axios, the FCC chair endorses Trump's ability to fire commissioners. [00:31:00] So there's a, there's a lot of, uh, energy right now around testing the limits of the president's authority with, um, the regulatory agencies that are in the executive branch, but especially those that are, uh, that were established to be independent.

[00:31:19] Marcus: Um, the FCC is one of those. 

[00:31:22] Vic: The, um, there's a difference, I think, from a legal point of view in something like the Consumer Financial Protection Board. I think I said that right. Bureau. Bureau, which has one leader, um, that the president can appoint, uh, versus the FTC that has a five member board that kind of manages it.

[00:31:44] Vic: Traditionally, the president would put in the chairman, the leader of the board, and name three of the five commissioners, um, but not the other two. And that allowed [00:32:00] for at least some balance so that in the minority, you couldn't swing a decision, but you had a voice. And I, the people that I'm listening to around this, because it's, it's chaotic and there's so much coming out of DC every day that I have to sort of choose what I'm going to follow.

[00:32:17] Vic: But I think this is going to be It's in the federal appellate courts right now, I think. It's going to go to the Supreme Court because Trump's administration, Trump himself and his attorneys, I think are really testing the power of the presidential office, the executive branch, and it's unclear whether the Supreme Court will allow that or not, um, but obviously it will, it will create a very different regulatory environment for mergers and acquisitions, which impacts our business directly.

[00:32:51] Marcus: Hey, um, I, I haven't had a chance to listen to, uh, the shows that you guys did while I was out because literally it was just back to back to back. [00:33:00] No, no breather. Um, did, did you guys talk about Brad Smith and Doge? We 

[00:33:05] Vic: did not know Paul and I talked about, uh, policy in general for the different parts of the healthcare system.

[00:33:14] Vic: Um, but we didn't, we didn't touch on Brad. 

[00:33:16] Marcus: Okay. Well, let's just talk about it right now. I mean, you, you, you didn't, we'll, we'll find a link and throw it in the show notes. Um, I know that there are a couple of that are out there, but, uh, this is, this is a pretty big deal, isn't it? So Brad Smith ran CMMI. Uh, and has built two companies in partnership with Senator Frist.

[00:33:40] Marcus: Uh, first was Aspire Health, the second was CareBridge, um, both have sold for, uh, over a billion dollars, I think maybe one was two billion dollars, um, both to Anthem, right? Anthem or 

[00:33:53] Vic: Elements? 

[00:33:54] Marcus: Well, it's the same. 

[00:33:55] Vic: Well, yeah, I guess, I guess, right, 

[00:33:57] Marcus: yeah, okay. Yeah, um, and he [00:34:00] was tapped to be the healthcare lead inside Doge, so, um, It's a, it's a pretty good pick, right?

[00:34:10] Marcus: If, if you're, if you're focused on efficiency and you want to go into healthcare, a guy who ran CMMI and then built businesses against value based care models, 

[00:34:24] Vic: yeah. And he still has main street right now. Yeah. That's like, wow. 

[00:34:28] Marcus: Uh, that, that's a, that's a pretty good profile to, to go in there. Um, this is a guy with, uh, a ton of Nashville sensibility when it comes to like how healthcare works.

[00:34:44] Marcus: Uh, but it's not at all like limited to Nashville. I mean, he's, he's, he's a, he's a nationwide guy. Um, And CMMI was, you know, I don't think anyone's going to cry tears if, if CMMI gets, gets axed. I mean, I [00:35:00] think health system CFOs all over the country will rejoice about, you know, uh, CMMI going 

[00:35:06] Vic: away. Both sides, uh, Democrats and Republicans used it to try to experiment with new things.

[00:35:12] Vic: And it had good aspirations. It maybe didn't deliver that much, but. He was at sea for the whole Trump one. 

[00:35:21] Marcus: Yeah. So, so I, I think there is an interesting question though, as we see these broad sweeping cuts happen and Doge moving through, uh, departments where they may not have a version of Brad there, right.

[00:35:44] Marcus: Having Brad in Doge leads me to believe that while the cuts may still be swift in Doge matter, that they will be thoughtful insofar as we have someone who understands how [00:36:00] the system actually works. What, what, what do you think about, what do you think about that? I mean, I tell you what, like you can, you can, you can be afraid, but I'd much rather have him in there than not have him in there.

[00:36:15] Marcus: Yeah, that's, that's where I was going to start. I think 

[00:36:18] Vic: there's, I don't know if there's a better pick. Um, He is a really good operator, but he also cares about physicians and patients and payers and he understands the balance of our healthcare industry with the payers and providers naturally designed to hold each other accountable.

[00:36:38] Vic: He understands that in a way that not many others do, and he's delivered significant value for shareholders in at least three companies, maybe more. Um, I think there's a lot of health care that could be redesigned to be better for everyone. Now, [00:37:00] it's going to be a hard process because it's a big system and turning it, no matter who you are, I think is going to have some, to me, some places where there are cuts that maybe are not immediately fixable.

[00:37:16] Vic: Filled and people's life is at stake and their health is at stake. And so it's a hard job, but I agree. I think he's a great choice for it. There's a lot of fear around, you know, cutting anything, but I think he definitely knows he knows what to do. And he has the right perspective. He's going to try to save money, but he's not going to do it at the expense of.

[00:37:39] Vic: care, broadly, I wouldn't say. 

[00:37:41] Marcus: Yeah, and I also think it's pretty interesting that Doge even brought in somebody of his caliber to do the healthcare thing, because you have to ask across all these other areas, did they feel it necessary to bring in that kind of expert? 

[00:37:57] Vic: Yeah, it's really interesting, um. [00:38:00] They, they have a pretty large number of people that are there voluntarily just to, because they're Americans.

[00:38:06] Vic: Now whether, whether we like exactly what they do, they're trying to do something that they think is right. And at the day, that's on 

[00:38:16] Marcus: balance probably good. Well, look, I mean, but I guess a couple of things, one, I have, I've never felt so vindicated in my assertion that, um, while what you do is important, how you do it is also important as I do right now.

[00:38:39] Marcus: Um, hopefully people are like getting that the, how actually does matter. Um, and, uh, you know, I think that

[00:38:55] Marcus: the, the problem, the problem that the, that the [00:39:00] Democrats have created. Is that they simply would not have conversations about the deficit, like real conversations addressing the concern of the deficit. Right. Um, and you, you give, you give, uh, you, you give doge and you give Elon

[00:39:36] Marcus: kind of room to run in whatever way they want from a how perspective. Because at least they are addressing that issue. You know what I mean? And, and, and to me, this is like, this is such a consistent theme with the Democrats, which is why I think the democratic party is like in such terrible, [00:40:00] tremendous trouble, even watching like how they're responding in this moment.

[00:40:05] Marcus: You know, I, I think this party is in such tremendous trouble because when you look at the first, you know, what is it, February 20th, the month, when you, when you look at the first month of the, of the, of the Trump presidency, right? I mean, the level of intensity that this has come with and whiplash, not just domestically, but obviously internationally, right?

[00:40:30] Marcus: It's, it's, this is so incredibly intense. And it just, it simply begs the question, does everyone like this level of intensity? Right? Is this what everyone wanted? This level of intense whiplash? Or did they just want somebody to address some core issues that, that standing leadership was unwilling To [00:41:00] acknowledge needed to be addressed.

[00:41:03] Vic: Yeah. 

[00:41:03] Marcus: And I, I think I, I just think it's the latter. I just think it's the latter. I think like, yeah. 

[00:41:10] Vic: And there's, there's just a vacuum of credible democratic voices and our system works better with both sides contributing. And I, I sent, um, there's a, there's a op ed, you were gone, it was on February 13th, Ro Khanna, Khanna, I hope I'm saying that right.

[00:41:34] Vic: Yeah, 

[00:41:35] Marcus: yeah, yeah, that's his name. 

[00:41:36] Vic: He's the Democratic, he's in the House, uh, in, um, Soka Valley. Yep. And he wrote an op ed in the, uh, New York Times, and I sent it to my sons, because I said, finally, You know, a strong democratic response. Um, and, and it was great. I mean, he's basically saying what you're saying, like, we [00:42:00] need to be honest that there's people in middle America that are suffering and the democratic party needs to recognize that and then try to help them as opposed to just pretend like everyone's fine when they're not fine.

[00:42:14] Vic: Yeah. You lose credibility. So, um, But, but he's, you know, one congressman and there needs to be some more leadership on the democratic, hopefully there will like a governor or maybe he can do it, but it's just, um, I don't know. 

[00:42:34] Marcus: I think that, um, There's, there's, there's going to, there's going to have to be sort of a, a, a takedown of the establishment because the establishment is not gonna, not gonna change their, their tune.

[00:42:45] Marcus: Um, and I mean, I think, 

[00:42:47] Vic: uh, Elon is a lot of things, but he is very, um, prepared and he's working 24 hours a day. And he's, uh, [00:43:00] he is using, I think Ronald Reagan's playbook where, I mean, remember that it was like a 8, 000 toilet in the, in the Pentagon that, uh, they pointed to, and it got to be like a meme before memes were out cause the eighties.

[00:43:15] Vic: But that's what Doge is doing. He's a, he's attacking things that are. Clearly, waste, fraud, and abuse, and in middle America, people don't want millions of dollars going to something when they are struggling themselves. That's just the warm up. I mean, what he's doing is sort of like gaining credibility and making the, the talk track be, there's all these problems, and then people will stop listening, and then he may make a bunch of cuts, and instead of the Democrats complaining about him.

[00:43:49] Vic: Elon wasn't elected or whatever. They need to be more, I don't know, assertive and studied and try to say, yes, these are wasteful things. Let's cut that. But [00:44:00] these, these aspects, these programs would really need, you can't have, you can't say everything is bad. 

[00:44:05] Marcus: Yeah. And then like, you know, and then saying things like he's not very smart.

[00:44:10] Marcus: I mean, it's just not true. It's just like, you know, 

[00:44:18] Vic: and you say we didn't talk about it in the, in, when we were catching up about Saudi Arabia, one of the things you said really resonated with me, which is people are working 18 hours a day. They're like, go there to go. They're trying to make their life.

[00:44:29] Vic: They're working incredibly hard. Yeah. And there's a feeling that's, uh, more urgent than in the U. S. maybe. Not everywhere, but, but broadly. And, um, that's kind of what Elon and Brad and, and these are people that, I mean, Brad is the same and Elon's the same. They'll work 24 7. I mean, Brad is really talented and he works all day, all night.

[00:44:55] Vic: He works on weekends. He just working all the time. 

[00:44:57] Marcus: Yeah. And, and, and to be honest, [00:45:00] I mean, I feel like there is something that American business people who do business in places like Saudi Arabia and China. Understand about the competitive nature of the world right now and like, what's at stake. Um, and again, nothing I'm saying is justifying what, what they're doing.

[00:45:26] Marcus: I, I, again, to me, how you do things really, really matters. And, um, I think that there is a lot of cruelty and a lot of distress and, um, a lack of decorum that I see that is, you know, Whatever. I just wasn't raised that way, so whatever. I wasn't raised that way. 

[00:45:49] Vic: You can do the same changes in a, in a more respectful way.

[00:45:55] Marcus: Yeah, like a statesman. You know, um, but anyway, listen, [00:46:00] uh, but, but the, the, um, the work ethic and the focus and the bar and, and the, um, and the commitment to excellence, like these are things that in many, many aspects of American culture are lacking compared to other countries and like we, we, we are. There, there, there, there is a bit of a, like, la la land that we have here.

[00:46:32] Marcus: Yeah, we're soft. We're soft. Well, well, we We don't understand the things that underpin our standard of life that give us this. We don't think the country can go broke. We don't think we can lose the dollar as the, as the world currency. Like we, we don't think these things can go away. They can go away. And people are working every day around the [00:47:00] clock to make them go away.

[00:47:01] Marcus: I

[00:47:04] Vic: mean, when you were in Saudi Working. I went to Columbia just for fun. Um, and it wasn't, it's not the same as Saudi Arabia, right? Because they're not a center, but it is outside the U. S. bubble. Like, you know, it's not, it's not really under U. S. protection. It's not like going to, uh, U. S. Virgin Islands or something.

[00:47:24] Vic: Um, and People are hungry and like really hustling because there's no safety net, like, and the difference between middle class and really poverty is not that far, like one misstep and all of a sudden it's, it's gone. And that like, uh, It's just on the frontier, right? It's, it's, it's outside of the bubble here.

[00:47:53] Vic: And it's fun, as an American, because the, you know, they don't use coins there. And I said to the hotel, like, [00:48:00] why are there no coins? Like, well, two thousand, whatever their bills are, is fifty cents. And so, like, there's no real need for coins. But it's just, uh, they have to hustle. There's no, there's no safety and there's no security.

[00:48:15] Vic: And that's also bad, but, but it drives this like hunger or work ethic that is that, you know, they're, they're working hard to survive. And yeah. Um, yes, the U S dollar reserve currency. Gives us just incredible power and our military power gives us incredible power, but both are maybe peaked in 1998. 

[00:48:43] Marcus: Yeah. I mean, certainly peaked in terms of like.

[00:48:47] Marcus: Uh, clear dominance. Yeah, we were the only, we were the 

[00:48:50] Vic: only global power in the late 90s, and, and now we still have a lot of power, but this other, I mean, Saudi Arabia is rising, China is rising, Russia, who [00:49:00] knows what Russia is doing. This is all kinds of craziness. All kinds of shipping. 

[00:49:05] Marcus: All right, let's move to industry stories.

[00:49:06] Marcus: Humana Centowell unit plans further expansion in 2025. Humana Centowell seems to be doing pretty well picking up, uh, you know, where Walmart left off and now looking at further expansion. It seems like a good focused model, um, you know, it kind of fulfills their, their provider, uh, agenda and it's focused on a particular demographic.

[00:49:24] Marcus: So they should be able to do very well with that. 

[00:49:27] Vic: Yeah, they, they are moving, uh, you know, the payvider business model we cover normally from the provider side, you know, now underwriting insurance, he may just go in the other way. And they're only, they really focus on Medicare Advantage primarily. So I think it makes a lot of sense there.

[00:49:46] Vic: They are. getting much more engaged with their subscribers, their members, their patients in center. Well, and that that keeps them longer on the Medicare Advantage manner plans, [00:50:00] and they able to manage them better. I think it makes a lot of 

[00:50:02] Marcus: sense. United Health Group offers buyouts to eligible employees, according to reports.

[00:50:07] Marcus: Yeah, and 

[00:50:08] Vic: I think it's 30, 000 employees could, could take this buyout and, and not work there anymore. Um, and I think that's an example where they are trying to be proactive, like the United makes plenty of money, but they're trying to be efficient and really prepare for the whatever's coming next. And I think that's probably smart.

[00:50:34] Marcus: Yeah, and I agree. I mean, I think I think the offer to the buyout, right? Um, that's that's pro that's being proactive, right? That's not the same as a layoff. Um, they they are very data driven. Um, they normally never miss their quarterly earnings reports. And so I think they are looking down the down the pipe and saying, Hey, um, We might, we might need to make this move [00:51:00] now to secure future profits, you know, given macro trends and other things that are going on.

[00:51:04] Marcus: So. Uh, common spirit logs, 135 million of Q2 operating gain on higher volumes. Checked labor spend. You know, I, I, I think about one of our first episodes had to be in the first like 15 where we went through that, um, that common spirit, uh, financial report like line by line, uh, when they were like burning all sorts of massive cash.

[00:51:29] Vic: Yeah. 

[00:51:29] Marcus: Yeah. Yeah. So, so this isn't like a happy story that they have really turned the 

[00:51:34] Vic: ship in the last two years. In a great great fashion and it's a big it's a big platform big ship. I don't know how many states but a lot of states And so it's great to say, I mean, uh, Paul and I were talking about this last week, the, the scaled nonprofit health systems, Common Spirit, Ascension, Kaiser, they, they're doing pretty well.

[00:51:56] Vic: I mean, um, it's more scale, I think, and [00:52:00] strong execution, really strong management teams than it is whether you're a for profit or non profit. 

[00:52:06] Marcus: Yeah, I agree. I agree. Right, Lassiter, uh, went from Henry Ford to be the CEO of Common Spirit, and He's, uh, he's kicking ass. Congrats to him. Uh, Mass General Brigham opens fiscal year 25 with 54 million operating loss, expects to lay, expects layoffs to save over 200 million annually.

[00:52:22] Marcus: So this was, it was a little bit out of the blue. Um, you know, learning that Mass General Brigham is having some, uh, financial problems. 

[00:52:29] Vic: Yeah, I was really surprised about this. I think that academic medical centers in general are going to be under pressure from the NIH, uh, so I don't know, like one of the things we covered is NIH is claiming they're going to cap the overhead payments at 15 percent to all grants.

[00:52:48] Vic: Yep. That's going to be really difficult. That's really 

[00:52:50] Marcus: difficult. That's really difficult. Platforms like 

[00:52:52] Vic: MGH, and I guess, and Master of Wriggums. Yeah. But that didn't happen yet. So they [00:53:00] are already sort of struggling and trying to, trying to cut back. 

[00:53:05] Marcus: Hopefully they get this turned around. Um, let's see, what do we got next?

[00:53:09] Marcus: Oh, another not so great story. Uh, CHS has losses widen in 2024. Um, they widened to 516 million in 2024 up from 133 million in 2023. I mean, goodness gracious. This is like, and I mean, I think the really sad thing about this is, Vic, CHS has been struggling for how long now? 

[00:53:34] Vic: I mean, I've been in Nashville 25 years.

[00:53:36] Vic: I think 25. No, no, no, no, no, no. It hasn't been that long. They have been struggling for 10 years, at least. 10 years, 10 years, 10 years, 10 years. And they, uh, they've sold off a lot of their really profitable assets to pay down debt. They have a lot of debt. They took on a ton of debt to do all the buying in the beginning.

[00:53:56] Vic: And now they're having to like sell. The only assets [00:54:00] that can sell are the ones that are performing. And so it's just this like, you know, really difficult spiral where you, you, you have to sell something to pay. To pay off a debt that's come due and you can't sell the, the, the facilities that are really burning money.

[00:54:21] Vic: And so you sell 1 of the 10 hospitals that are doing well, or whatever the number is, some number are doing. Okay. But then you only have 9 left. And then the next year you do it again. So. I don't know where it goes, but no, we're good. 

[00:54:35] Marcus: Yeah. That's ugly. It's ugly. 

[00:54:37] Vic: There's a lot of people. I mean, we have friends there.

[00:54:39] Vic: There's a lot of people that are good. They're good people, but the system is just over leveraged and the, and the assets they have are not. They're not designed in a way that can really have any leverage negotiating with payers or, or having, 

[00:54:56] Marcus: I'm not even sure how many people that are their leadership [00:55:00] today were responsible for the buying that created the current situation.

[00:55:04] Vic: Yeah. 

[00:55:05] Marcus: Most of those people have left. Yeah. Yeah. It's not, it's not the same C suite. I don't think so. 

[00:55:10] Vic: Yeah. 

[00:55:12] Marcus: I mean, they're just trying to navigate a very, very tough situation. Uh, NYU Langone Hospital nurses give strike notice. We've seen this pop up in different 

[00:55:23] Vic: parts of the country. Nurses and unions know they have bargaining power.

[00:55:28] Vic: And so I think it's going to keep happening that they're going to have to figure out some way to settle with them. Um, I think we've discussed they can, hospitals seem to be able to hold on for a week to two weeks, um, bringing in outside staff and things, but then, so, ten days from today, they're going to go on strike if they don't get to some set up, but they're still negotiating, but, um, right in New York.

[00:55:54] Marcus: Uh, at Vive, which was here in Nashville, but I was too sick to go to, um, we had a look under the hood at [00:56:00] Ryzen Health's value based platform. 

[00:56:03] Vic: Yeah, I went to Vive. Vive was great. Um, nice to have a home game where I could sleep in my bed and then go see all these people from around the country. Exactly, exactly.

[00:56:12] Vic: And it, it was good. A lot of, a lot of, uh, stuff that we cover every week here. So not that many new things, but this was new. So Ryzen, of course, is Kaiser's, uh, brand that, uh, they used when they bought, um, Geisinger and then they added Kone. And it's really interesting. They are not Integrating all the operations into one massive platform.

[00:56:38] Vic: Instead, they're, they're sort of overlaying. We're going to work together on value based care initiatives. Um, and that's how they're sort of. Working with the groups that they buy pretty interesting way to sort of align interests and kind of let each each operation kind of opt into whatever they need for their [00:57:00] population.

[00:57:00] Vic: At that time. 

[00:57:04] Marcus: I'm super excited about this. I think it's very, very smart. Um, I'm excited to see the team that they build and, uh. Yeah, rise, rise. It's just an exciting story. Um, a really exciting story to see a different type of nat national. We were just talking about the success of common spirit, which is great, but also like a very sort of still fee for service based based model.

[00:57:28] Marcus: A lot of the large scaled, um, uh, nonprofits. I think, you know, common spirit ascension. Um, uh, Advocate used to be atrium. Uh, they're largely fee for service platforms, right? So this rise in profits are all that 

[00:57:48] Vic: way. So all the, all the scaled ones, except for rising. 

[00:57:52] Marcus: Yeah. Yeah. So definitely rooting for them and excited to see how they, you know, continue to evolve and roll this out.

[00:57:58] Vic: Yeah. And if you're going to cobble [00:58:00] together sort of a eight or nine kind of regional players. into a nationwide platform. You need something to hold it together. 

[00:58:08] Marcus: Yes. 

[00:58:09] Vic: And I like the idea of doing value based care as opposed to just like imposing some, some standard that everyone has to do it X way. 

[00:58:17] Marcus: Yeah.

[00:58:18] Marcus: Agree. Agree. Uh, vibe 2025 multi plan unveils rebrand as it shifts focus to data assets, tech for providers, payers, and employers. Multi plan has always been sort of a complicated thing for me to understand. 

[00:58:32] Vic: Yeah. I think of them as like a, um, Almost a TPA, a network of docs and then they've added in other things to optimize the network for employers and consumers.

[00:58:45] Vic: Multi plan might be the worst name ever. The new name that much better. Clear it is. Um, gonna be hard to spell out of the URL and everything, but, but I guess good. [00:59:00] 

[00:59:01] Marcus: Didn't talk about home team companies like that. Uh, all right. Lumetris unveils AI tech for primary care, Dosebot's latest Rx transparency tool.

[00:59:11] Vic: Yeah, so that Lumetris has an AI, I'd call it an agent that they've named Tom, which is kind of bizarre, but, but Tom helps the primary care doc. With, you know, helping with their patients, taking away a lot of the time consuming tasks that everyone is trying to take away. Um, interesting. I don't know how effective it is, but they're saying there's 2 billion hours that we don't have enough providers to fill and they want Tom to help with that.

[00:59:49] Marcus: Okay. All right, into our AI rundown. Let's try to move this quickly. Uh, Cordy AI adds up to date integration to its platform. 

[00:59:57] Vic: Yeah, so Wolters Chlor, [01:00:00] Chlor, I'm not saying that right. They're, they're a very well known healthcare data, evidence based, all been around forever. Um, integrating that data set into AI I think is really meaningful.

[01:00:14] Vic: Really strong data set. It will mean that the AI is is much better, um, and will hallucinate less and can, could maybe really be helpful. 

[01:00:25] Marcus: Okay. So, so Cordy AI is when we need to track really because of the Walters Kluwer partnership. 

[01:00:30] Vic: And I assume that they paid a bunch for me. It's really valuable data. So I think they probably some license deal.

[01:00:37] Marcus: Yeah. License or maybe a bunch of warrants on the company or something like that. 

[01:00:40] Vic: Yeah. 

[01:00:40] Marcus: Um, Zuckerberg bets big that real humans want humanoid robots, meta's latest AI push. You know, it's, it's, it's just interesting, um, how bad so far Zuckerberg has been at hardware. He's been really bad at it. I mean, the phone was trash.

[01:00:57] Marcus: The portal was trash. [01:01:00] Um, Oculus is okay, but I don't know anyone who like actually uses it on a regular basis. Um, and he's not, he's not actually building robots. 

[01:01:09] Vic: He's building tools, AI software to, and sensors to empower other. Got 

[01:01:17] Marcus: it. Okay. That makes sense. 

[01:01:20] Vic: So he is self aware or more likely just knows that it's.

[01:01:24] Vic: It's 30 years of investment that other firms, um, have done in robotics. It's really hard to catch up on. 

[01:01:32] Marcus: So it's basically a way for him to like take all his investments in the AR VR labs and turn it into a B2B enterprise. I 

[01:01:41] Vic: mean, he built all of the sensors, you know, he has various, uh, touch things, interactions for the Oculus and further stuff.

[01:01:50] Vic: And now he's able to use that. But sell it to, uh, I can't remember the robotics company's name, but there's only like 10 that are pretty well known. [01:02:00] Boston is one of them. 

[01:02:02] Marcus: Yeah. He, he, he had, he had way too much in on R and D at, at Horizon Labs to not like find a repurpose for that exhaust. Yeah. I 

[01:02:14] Vic: mean, it's 5 billion.

[01:02:16] Vic: He spent 5 billion on his virtual reality glasses stuff, and it's Not going to work, or maybe it'll work slightly, but it's not going to repay that much money. So I think it's a smart way to really kind of reposition into something that at least we'll have three to five years of hope for the stock.

[01:02:36] Vic: Maybe, maybe it'll pan out. 

[01:02:38] Marcus: Yeah. Wall Street Journal, AI agents are everywhere and nowhere. I love that headline because I agree with it. Um, we're hearing about agentic, agentic, agentic, and it's like. Okay. But who's using agentic, uh, in this article, they have a picture of Brett Taylor, who was the former co CEO at Salesforce and former CTO at Facebook.

[01:02:58] Marcus: Um, who's launched a company called Sierra [01:03:00] that is fully focused on, uh, consumer support, uh, agents. But yeah, what, what, what's, what's your read on this? Um, this, uh, the story. 

[01:03:09] Vic: Yeah, I think it, I mean, you framed it up pretty well. They had a bunch of CIOs at a conference in Menlo park. Talking about AI and this every 60 percent are testing something, uh, but no one is really using it in any broad capacity.

[01:03:27] Vic: And just cause you call it an agent. doesn't make it any different than the AI that we had six months ago. Um, it's not, it hasn't been integrated into like the workflows and how business operates yet. Um, maybe it will soon. Um, I've been playing with a lot of these agents and they're, they're okay. Maybe marginally better, but it doesn't really.

[01:03:54] Vic: You can't just plug it in and let it answer calls from customers today. Now, that might be a 1st [01:04:00] place where you could have that, you know, 1st level support, for instance, could be a place to look. But so far we haven't got watered option, but it is so much buzz. That's the title. Yeah, 

[01:04:12] Marcus: yeah, I, uh, I was watching a, um, online video.

[01:04:17] Marcus: I think it was on YouTube and it was this guy. I think his name is Logan Kilpatrick. Um, he was interviewing. And it was actually a really good interview, but I, I, I, you're way more dialed into all in these days than I am. Um, I still, I still got to get over my like sacks, you know, he's not on it anymore. So I know it doesn't matter.

[01:04:38] Marcus: I, I, I've still, I'm so, I'm just allergic to, to, to that guy. Um, but anyway, um, the, the, uh, the interview with trim off, I was really good. And I learned about the 80, 90. I learned about the 80, 90 company that, that he's doing, but, but I loved what he was saying. He was just talking about how, okay, we have all this AI [01:05:00] stuff, the, the models, whatever, ultimately going to go to open source, agree with that.

[01:05:05] Marcus: Um, he, he was pretty pro, uh, Gemini, which I am too, just more for utility. Cause it's tied into all my data, you know, in our, our 

[01:05:14] Vic: Gmail and Google. 

[01:05:17] Marcus: Yeah, yeah, exactly. Like, like, I get more utility out of it because it's literally where all my data is. Okay, so there's that. Um, but then he was like, to actually make this stuff useful for business is going to be a freaking grind.

[01:05:31] Marcus: And it's, you know, so he's dedicated a company to that. And I'm like, That's, that's the reality of this stuff. It's like, you know, I was reading a post from this guy, Ravi Gupta, that, that, uh, Nick Holland sent me. And the guy, you know, he works at Sequoia. He used to be the COO, CFO at Instacart. And he was like, all these companies are going to be refounded.

[01:05:52] Marcus: And this is right. Like it's, it's true for, for one person startups using cursor, like. You know, we're going to have a whole new [01:06:00] swath of companies. That there's no question about that. We run a pretty small firm. So, but one of the things he said was take a week, a week off and try to like reinvent at least one aspect of your business in AI.

[01:06:11] Marcus: And I'm like, you know what, that's actually really smart. That's something you and I can do. And we can't do it this quarter, but we can look to like the end of the second quarter, we can say, okay, like let's take off for a week. Let's pick one part of our business and just like hack at it for a week and try to figure it out.

[01:06:25] Marcus: But like, take a week off. To try to do one part of your business, like that's the, that's the requirement to actually get this stuff to transform your business. It doesn't do it because you pay for a SAS license to, you know, hopscotch AI, you know what I mean? Like, 

[01:06:42] Vic: that's what I mean. The interfaces are not good enough.

[01:06:45] Vic: You really have to clearly document exactly what are all the steps that you do. And I, I do steps all day to send to say, send an email or whatever. And when you write 'em [01:07:00] down, and I've done this, that you might get to like 70 steps and it takes four hours to document it all. And then you have to start like having an AI agent do those steps and it doesn't do it that well.

[01:07:14] Vic: And I haven't found easy places just to plug in any of these agents where they just work out of the box that they don't 

[01:07:22] Marcus: know they don't. And like, most people in today's world don't have the time. So the ones that are going to eat the lunch are the ones who have the time. Yeah, if you've got the time, the luxury of time to sit there and just hack at this thing, you're going to, you're going to win.

[01:07:44] Marcus: But for all the people who have a going concern that they have to manage and keep going and like hit numbers on a regular basis and like serve customers and support customers and all that kind of stuff, it's just not going to happen. It's not going to happen. 

[01:07:56] Vic: I mean, I, and, and a lot of the time is wasted.

[01:07:58] Vic: I mean, I [01:08:00] learn, but I've probably wasted, um, I don't know, 20 Saturday mornings where like all Saturday morning, 8am to noon, trying to get something to work and it just doesn't damn work. I learned a bunch of things that don't work. And that is pretty frustrating. You know, if you're not willing, if you don't just like the learning process.

[01:08:23] Vic: It's hard. So anyway, that's where I think that I feel really bad for you. It's just part of this is part of the way I don't learn unless I'm tinkering and trying to do something. Anyway, if I just watch a video, I don't learn anything. So, all right. So you would have done it much faster. 

[01:08:44] Marcus: Yeah, it is true. If you've been a developer, even if you haven't coded like like me for like 15 years, it's like still still like no.

[01:08:53] Marcus: You still know the stuff, you know, 

[01:08:55] Vic: um, it's all like the little things that, that trip you up, that take three [01:09:00] hours and then I miss finally, I'm just throwing my hand on. 

[01:09:02] Marcus: It's, it's, it's it's context. It's it's context that you have because you have coded Yeah. That if you have not coded, you don't have, like, you're just, you, you just, you're just missing the information.

[01:09:16] Vic: Yeah, so you don't know what to, I don't know what information I'm missing even, which is the problem. 

[01:09:21] Marcus: Yeah, like, like I was telling you when we were talking about building an application in Repl. it, you know, like one of the things I told the AI was like, go read the error log and find this. You know how many people don't know that like a regular part of programming is to read the error log?

[01:09:38] Vic: Yeah, 

[01:09:39] Marcus: I don't know that. Yeah, it's just, it's just context for like, what, what is the act of programming? Like what are the different Components of the work that you do. So anyway, let's, let's, let's keep going. That's a six 

[01:09:53] Vic: month course. Yeah. 

[01:09:54] Marcus: Yeah. Yeah. Yeah. Uh, okay. Microsoft claims quantum computing breakthrough by creating new [01:10:00] slate of matter.

[01:10:01] Vic: Uh, you know, Google had a quantum computing chip maybe two months ago and now Microsoft has one. Um, I mean, it's coming. And so, neither is, I mean, Microsoft won't sell this yet, they're sort of just experiments, you know, it's a science, uh, research project, but I, I want to keep following it because quantum computing is going to really change, uh, security and how we keep track of bank records and health records and everything, and so.

[01:10:31] Vic: Can we at 

[01:10:32] Marcus: least get through two years of Trump before we get quantum computing? I, I don't, I think you have probably five years. I don't think we can handle the two overlaid with each other. I mean, that, that is, that's a level of chaos in our, in our lives. That just, yes. I am ready for it. Okay. Exploring the structural changes, driving protein function with bio emu one.

[01:10:58] Marcus: So this is another Microsoft [01:11:00] story. And I guess they are, I mean, back to back stories about how they are meeting Google sort of, uh, you know, tit for tat. This, this sounds like deep. 

[01:11:09] Vic: Yeah, it is. It's very similar to deep mind and I choose to see it as healthy that we have. Oh, yeah. Two American companies that are both.

[01:11:21] Vic: pushing on all of these really pretty deep science things like quantum computers and protein folding, and it's great. And then they open it up and allow everyone to play with them. So for medical research and new drug discovery, this is much more important than quantum computing. We already had AlphaFold, but it's great to have another, another view of it.

[01:11:45] Marcus: I'm reading this and it says they've enabled this by training bio one on alpha fold. So this is like what happens when people are open sourcing things. It's like you get, I mean, it's competition, but like, not if you open source the [01:12:00] training data. Yeah. Right. Well, that's collaboration. That's collaboration.

[01:12:04] Vic: Yeah. And it's why that, uh, it's why technology accelerates, right? Cause the, the next thing allows a bunch of groups to then move faster. And it's, I think it's, it's, there's no question. It's a net positive. There's a lot of, a lot of things changing really quickly. Uh, but it's good. 

[01:12:27] Marcus: Elon's XAI has released Grok three.

[01:12:29] Marcus: So, um, and they've also rolled out the Grok app. 

[01:12:32] Vic: Yeah. So, um, Elon built this huge data center in Memphis. It might be the biggest in the world or one of the biggest in the world. 200, 000 GPUs from, uh, NVIDIA. And it's been training for the last eight months or something. And now Grok 3 is ready. Um, I think it's competitive with OpenAI and DeepSeek and Gemini.

[01:12:56] Vic: Um, kind of like you were talking about listening to the [01:13:00] 80, 90 stuff. My view is that they're all, they're all really good. And I'm more interested in sort of the downstream, you know, as they. As they produce these new models, then they open source and just give away the last like, like Musk has given away Grok two now, and that's great for entrepreneurs and doctors and patients, anyone that wants to sort of get intelligence, basically free.

[01:13:29] Marcus: Yep. Agree with that. OpenAI co founder Sitzkever is, uh, launching a startup and is fundraising at a 30 billion plus valuation. 

[01:13:40] Vic: It's hard for me to get my head around. And he is working to go to like super intelligence and doesn't care about any of these interim steps. Which is interesting, um, and I mean, the, the reason [01:14:00] for the story is it's interesting, he's well known, there'll be another, there'll be another competitor with.

[01:14:06] Vic: The four I just named. Um, and the other piece of the story is open AI, you know, is losing talent. We have the next story as well. Um, I don't know what happened there, but, uh, Mira Moradi, yeah, Moradi, uh, this starting thinking machines lab, which is another frontier model, but much more focused that trying to incorporate humans.

[01:14:35] Vic: Um, side by side with the AI systems, like focus on the interaction between humans and AI. Not sure what that means exactly. But, um, but there's definitely this, um, I don't know, there's a bifurcation of the talent and we now have. Gosh, I don't know, five to 10 different companies all raising huge amounts of money.[01:15:00] 

[01:15:00] Vic: And there aren't that many world class data scientists. So it's going to be, um, fun to watch. I mean, it's going to be interesting. 

[01:15:09] Marcus: I say, let them go at it. I mean, 

[01:15:12] Vic: it's better for us, I mean, unless you're invested in one of these, which we're not, I want them all to. 

[01:15:20] Marcus: Yeah. I mean, look, I, I, I think that, uh, it's, it's less at the scale that it's happening.

[01:15:30] Marcus: It's less about, okay, let them all do it so we can take it. It's, it's more about, they're all trying to bring about the next step change in society. Like, like foot, like, like, you know, capitalists are trying to flip society. Into an AI society, you know, um, that's that's what else? What else can you say is happening here?

[01:15:54] Marcus: But by the amount of capital and the value is, 

[01:15:56] Vic: I think it's Edison and Tesla fighting over how we're going to [01:16:00] deliver electricity to the world. Yes. And, you know. Yes. Yes. One at DC, one at AC, whatever it was. And there becomes a standard, then Edison won and made a ton of money, and Tesla didn't. And he was really smart, but he wasn't Edison.

[01:16:16] Vic: And there's this first mover advantage. Whoever gets to artificial general intelligence first, then has the tool that can learn infinitely faster than anyone else, and you, and you win. That, that's the only reason you would invest in these models, um, because you get that step change, and then you have the, the next electricity for the next hundred years.

[01:16:41] Marcus: Yeah. 

[01:16:42] Vic: And, 

[01:16:42] Marcus: and look, the reality is, if society was not Set up the way that it is with nations and, and militaries and, you know, global competition and, you know, battles over land and all these other things that are all going on all over the world right now, if the, if the world wasn't set [01:17:00] up that way, you might say, Hey, maybe you shouldn't do that, but I'm sorry, the world is set up that way.

[01:17:04] Marcus: And so, um, we are, we are all going to run towards this, you know, you know, I basically it's reckless abandon because we don't know what's on the other side. That's the truth. Nobody does. So it's convert doesn't know what's on the other side. Altman doesn't know what's on the side. Musk doesn't know what's on the other side.

[01:17:22] Marcus: None of them know, but we're all running there because we've got to get there before the other person. Right. 

[01:17:27] Vic: Well, certainly deep sea coming out of China. If you weren't an accelerist before that, we're just like, it's just. All accelerator, let's go, we'll figure out whatever bumps we hit. You are now, because China is right on our heels and we definitely don't want them to have it and not us not have it.

[01:17:46] Vic: So, that's why I think, uh, the competition between all the Mag 7 is, is good. And Grok coming in and these startups, they're going to get funded and it'll be, they're all Americans. [01:18:00] 

[01:18:01] Marcus: Well, um, it's going to be back. 

[01:18:04] Vic: Yes. Welcome back. I loved having some guest hosts, but it's, but it's much better with the main host.

[01:18:10] Vic: So 

[01:18:10] Marcus: welcome back. Thanks, man. I, uh, I don't have any Thursday trips planned for a long time. So I, I imagine I will be here and we've got some good guests that are lining up. We're starting to get some inbound good guests, which is exciting. Uh, and great job on the interview. We just dropped the, uh, Seema Verma.

[01:18:26] Marcus: I was about to congratulate you on that. Great job on that. 

[01:18:29] Vic: Yeah, I'm excited about their, uh, their new product. It's, it's just now coming out, but I think it's gonna be really good. Yeah, I agree. I agree. It sounded pretty compelling. And we have, we have to do Clark from premise, you know, premises a machine and know about it.

[01:18:44] Vic: So that's going to be good. I think that'll be next week. We recorded it last week. It's a, it's a really good, and he's got incredible results. So premise is awesome.

[01:18:57] Marcus: Awesome. All right, man. I'll talk to you next week. All [01:19:00] right. All right. We'll do better. Bye.