126 – The UFC’s Political Power Move and What It Means for U.S. Healthcare

[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. 

[00:00:07] Vic: Alright. 

[00:00:08] Marcus: Happy Thursday. How you doing? 

[00:00:10] Vic: I'm good. It's a lot going on in the world. It's good to get caught up in 

[00:00:15] Marcus: things. Yeah. Um, I don't even know where to start.

[00:00:20] Marcus: Um, I had a really bad night of sleep two nights ago, and then last night I got nine and a half hours sleep. Oh, nice. Uh, thanks to some blackout curtains in my room. Yeah. Um, but I I, I do have to say it feels like, uh, there's a, there's a speed that things are starting to, to move at right now that is making it, uh, critical for this show.

Mm-hmm. 

[00:00:48] Marcus: Because I don't know what I would do if I didn't have this checkpoint. 

[00:00:53] Vic: Yeah. 

[00:00:53] Marcus: To, to stop and try to, uh. You know, capture [00:01:00] what has happened in these different categories and try to sit down with you and, and 

[00:01:03] Vic: yeah. And what is real and what is hyperbole that politicians are saying for their own purposes.

[00:01:09] Vic: And there's a, there's a lot of both. 

[00:01:13] Marcus: I mean, totally random, but I, but I feel like I need to bring it up just 'cause it's, so, two days ago, this is gonna be a hard left and I'll, I'll, I'll circle back. Okay. Yeah. Um, so in the mixed martial arts space, there's a, um, there's a journalist, his name is Luke Thomas.

[00:01:32] Marcus: And, uh, he used to be on SiriusXM. And, um, then he left there and kind of did his own YouTube show with this other guy. And, and, uh, he, he's, he's pretty well known as, um, a really, really solid, thorough MMMA journalist. Like really detailed. Um, there's, he understands 

[00:01:50] Vic: the different styles Yes. And can 

[00:01:52] Marcus: break it down at a deep level.

[00:01:53] Marcus: Yeah. At a deep level. So, you know, over the course of the last, um, [00:02:00] year and a half, I would say, and, and, and really heavily last year. Last last year, you could, you could really see it if you were an MMA fan and you were sort of watching his, his, um, journalistic takes. Um, one of the big things that happened over the course of last year was, you know, Trump was ramping up his comeback and one of the big platforms that he leveraged was the UFC.

[00:02:23] Marcus: Yeah. He's got a long standing relationship with Dana White and the UFC. Yeah. You know, like the history is that, uh, the. You know, there were, there were actually, um, Republicans, John McCain, um, in particular who, um, was very much against 

[00:02:43] Vic: Oh, in existing 

[00:02:44] Marcus: or, yeah. Yeah. Didn't, didn't sport. Yeah. Didn't think it should be illegal sport, you know, should be outlawed, all this other kind of stuff.

[00:02:51] Marcus: Um, and at the time, you know, Trump was more like Mr. Atlantic City. Mm-hmm. And so he was like, yes. You know, like, and he did a lot with wwe. Yeah. And so they was like, you know, let's, let's, [00:03:00] yeah. He likes a good show. Yeah, exactly. And, and he, and he is into boxing and Yeah. Fighting and all that kind stuff. So, so, so they started this relationship.

[00:03:06] Marcus: So now UFC is, you know, one of the biggest Yeah. It, it's certainly one, it's certainly one of the fastest growing sports in the world. That's like not, um, that's not a question. And, and they've got this global platform because they have fighters from all around the world. Yeah. You know, if you look at their champions, they'll be from Africa or from Eastern Europe, or you know, Spain or, I mean, that's one of the great things about, it's, it, it's.

[00:03:29] Marcus: It's a global sport. Yeah. Right? Yeah. So. So last year, you know, Trump was showing up at like every big event, and he would walk out in the beginning with Dana White and have the American flag sort of going on everywhere. And, you know, and Joe Rogan is, you know, I mean, this was all incredibly well coordinated, right?

[00:03:48] Marcus: Yeah. All the way down to the Joe Rogan, Donald Trump interview at the, you know, at the end of the race. And then Joe Rogan endorsing Trump like two days before the election or something like that. Like, it was all just incredibly [00:04:00] well orchestrated. So, um, so Luke Thomas, I, I guess, you know, is, is a liberal.

[00:04:05] Marcus: And he was getting like more and more like sort of riled up by, by the fact that this sports platform was clearly being used Yeah. As a, as a political campaign platform. Right. Um, and, and so, you know, more and more talking about that and more and more MMA fans, 'cause there's a lot of MMA fans that are, you know, on the right side of the album kind of going after him.

[00:04:28] Marcus: So anyway, I, I say all that to just set the stage for who this guy is. So he comes out with this sub, this, this, uh, post two days ago saying, Hey, you know, we're in a wacky world. I'm starting a substack because MMA fighters are now, and, and MMA fighters and MMA, um, owners now have an unbelievable amount of influence in politics.

[00:04:52] Marcus: Right. And, uh. Nobody thought this would happen, but here we are. And so I need a different platform to like talk about [00:05:00] this because there's nobody who's actually qualified to talk about this, this level of influence. And it's very, very real. It's, it's like, it, it's, it's way more real than people are giving you credit for.

[00:05:11] Marcus: Right. So Monday was St. Patrick's Day, Conor McGregor, you know, Conor McGregor was Yeah, yeah, yeah, yeah, yeah. Conor McGregor, um, most well-known mixed martial artists of, of all time, um, was in the White House for St. Patrick's Day and he was in the Oval Office and he made a statement about all the issues in Ireland, um, and the things that need to happen there and how it needs to be much more like the Trump administration and how, you know, all the things around immigration and mm-hmm.

[00:05:40] Marcus: Yeah, yeah, yeah. You, you can pretty much put it together. So then today, um, he put a post out on Instagram and he's running for president, he's running for President of Ireland, of violent.

[00:05:54] Vic: I guess that's good. I don't know if that's good or bad. I guess that's good. I'm not asking you to respond to whether it's good or bad. Right. It's, it's, it's, but it's [00:06:00] incredible 

[00:06:00] Marcus: that the change, um, that, and it's Conor McGregor, I mean, I mean, he's probably gonna win. He's probably gonna win. Yeah. He's probably gonna win.

[00:06:09] Marcus: Yeah. So, um, a long way of just talking about how rapidly our world is changing in ways that people just really had not previously considered. Yeah. Um, it's uh, it's something else. It's something else. 

[00:06:28] Vic: Yeah. I mean the, uh, the establishment, the institutions, the rules of society, how everything works after World War ii, I think are gonna be completely questioned and many of them will be changed.

[00:06:46] Vic: And

[00:06:50] Vic: I mean, after Trump won the first time. I now am not surprised at the difference who wins elections. It's a, it's a, [00:07:00] I don't know. It's an emergent property. The, the population does whatever they do, and they're not, they're not looking at like a detail list of pros and cons. They're, they're deciding the way they decide everything.

[00:07:14] Vic: Partially, rationally, and partially, maybe more than half emotionally from emotionally. Yeah. 

[00:07:19] Marcus: Yeah. So, uh, so yeah, thank you for continuing to sit in with me every Thursday. Yeah. Before we even get going. Just 'cause, uh, I would have a very hard time and, and I'll tell you what else, man, I, I, I notice it when I talk to other people.

[00:07:32] Marcus: I think people are so overwhelmed, um, not just with the whole flood the zone strategy, but I think the whiplash, uh, you know, the, the 180 plus the flood the zone. Mm-hmm. Um, it, it, it. It absolutely will short circuit you. Yeah. You know what I mean? Yeah. It absolutely will short circuit you. Um, and I think we're lucky both because we, we have this [00:08:00] platform, um, to think through all this stuff, but also I, we, we sort of saw this all unfold because we were early listeners to all in.

[00:08:12] Vic: Yeah. 

[00:08:13] Marcus: You know? Mm-hmm. We, we, we were, we watched how, how those four guys started talking about VC and, and then, you know, then COVID hit and. And then Sachs kind of took it in, in, in this direction. Yeah. And, and the different, you know, and, and watching Elon sort of, you know, come onto their platform. Yeah. And you know, I, I like, I feel like we got to see this unfold, and so we understand the players and why it is the way it is and why Scott Besson just did an hour long interview with the all in guys and Yeah.

[00:08:47] Marcus: You know what I mean? Um, and I feel like even, you know, even what I just shared with you about mixed martial arts is one of, you know, I feel fortunate that I'm a, I'm a, yeah. You know, you, I'm a fighter, so, you know, I mean, 

[00:08:58] Vic: you've either, you've either [00:09:00] been in the ring or on the mat fighting or you haven't.

[00:09:03] Vic: Yeah, that's right. And it's not, there's no middle ground, 

[00:09:05] Marcus: really. No. Yeah, no. So, so anyway, um, and even with all that it, this, this is still a lot to track. 

[00:09:12] Vic: Yeah. Yeah. And I think it is, uh, I mean the benefit for me is that, um, people are very emotionally triggered by something that happens. Yep. One way or the other.

[00:09:23] Vic: It doesn't matter which side you're on. And here in Nashville, we have plenty on both sides. Sure. Um, and I think the fact that it's healthcare and we're gonna have to talk about it and be reasonably balanced and try to get to what's actually happening and what's the messaging. And those aren't the exact same thing.

[00:09:43] Vic: No. I think it helps me be able to, um, not just immediately react to something that happens on CNN or Fox or on the radio and have more, maybe not more grounding, more perspective or [00:10:00] more ability to take a deep breath and try to like see okay, what what's real? I mean, there's plenty that's going on.

[00:10:05] Vic: That's real. Yeah. But there's also a lot of noise 

[00:10:10] Marcus: up there, there, there, there's a, there's a lot of benefit and then we'll, we'll, we'll actually get to the show. Sure. But there, there's a lot of benefit to. Not being easily triggered. And I don't mean that in some stoic way. I mean that in a way where you're actually able to digest what, what's happening and put it onto some form of scaffolding Yeah.

[00:10:30] Marcus: That your brain can actually make sense of. Right? Yeah. It it, and so that's the thing. Even though things are happening at this incredibly rapid pace, I still can mostly make sense of it. 

Yeah. 

[00:10:40] Marcus: Um, for the many, many, many, many millions of people who, who are unable to do that because they don't have the mental model, they weren't exposed.

[00:10:49] Marcus: They for all those reasons. This is just, you know, it's 

[00:10:53] Vic: just scary trauma. It's trauma traumatizing. 

[00:10:55] Marcus: Yeah. Yeah. It's trauma. Um, alright, with [00:11:00] that, let's dig in

[00:11:10] Marcus: the economy. Uh. The Fed met and they are holding still, but we have a poly market saying we're likely to get a series of cuts this year. Tell me a little bit about that. 

[00:11:24] Vic: Yeah, so, um, the Fed met and they kind of, you know, as you said, they, they're still concerned about inflation, but they're also somewhat concerned about the job market and didn't make any changes.

[00:11:37] Vic: But they did reduce the QT pretty dramatically from I think 25 billion a month to 5 billion. 

[00:11:46] Marcus: That's significant. 

[00:11:47] Vic: So they, they're, um, reducing their balance sheet at a much slower, slower pace. Yeah. Which is not accommodating, but it's [00:12:00] less, it's less, uh, friction. Yeah. It's less, less money being removed out, removed outta the system.

[00:12:05] Vic: Yeah. 

Yeah, 

[00:12:05] Vic: yeah. Um, so I think that was positive. And then. Yeah. The, the poly market and the bond markets are suggesting there'll be three cuts this year. Um, I don't really ex, I mean, there's enough layoffs and changes in the economy in addition to the tariffs. Mm-hmm. He, he spent a long General, Powell, spent a long time in the press conference talking about terrorists are gonna increase inflation.

[00:12:34] Vic: And so he's cautiously watching that. I don't believe that that's gonna really happen, but we'll see. You don't believe that tariffs are gonna increase inflation? I think they will, but I think the job cuts Doge is doing and other things are, are more of a drag on the economy. So I think in net net it's gonna be down.

[00:12:52] Marcus: Well, I, I, I was actually in a meeting today. I, I, I mean, both things can be true, [00:13:00] but I, I think if we're just talking about tariffs in, in isolation, yeah. Um, I was in a meeting today with, um. A guy who runs a boat company. Okay. And he said over the last week, um, 90% of his suppliers came to him and said, uh, everything's gonna cost 20% more.

[00:13:22] Vic: Yeah. I mean, I have that in my portfolio companies. We are gonna have to raise prices because our decent amount of our medical device supplies come from China or come from somewhere where there's significant taxes. I think that is, I think that's a fact. 

[00:13:41] Marcus: Yeah. I mean, that's standalone is, is, yeah. Is for sure a fact.

[00:13:44] Vic: Yeah. Okay. I, I also think that the economy is slowing due to federal job cuts. And so I think, I think those things will net out, but we will see how fast either one of [00:14:00] them take 

[00:14:00] Marcus: effect. Yeah. But will it net out in the CPI. Like, I, like, I feel like, you know, that's, that's the, that's the question. 

[00:14:09] Vic: Yeah. I, I, I, for the 

[00:14:11] Marcus: consumer, does it net out?

[00:14:15] Marcus: I think we'll have to see. Uh, I think it will. Yeah. I get your macro equation, but I'm like, mm. I'm not sure those two things touch fast enough. Yeah. The question is timing. Yeah. It's a timing issue. Yeah. Right, right, right. Okay. Uh, alright, next story. Consumer sentiment tanks as Americans expect more pain ahead.

[00:14:33] Marcus: Um, yeah, look, consumers are, right. 

[00:14:37] Vic: Yeah, that's right. And then, and it fell dramatically. I mean, 11% like month over month. Mm-hmm. Down. Um, and I think it's the, just the volume of. Confusing, scary, negative. Maybe we need this detox, but it's gonna be painful. All [00:15:00] that news coming out at once I think makes consumers sentiment go down.

[00:15:03] Vic: Yep. It just just does. Yep. 

[00:15:05] Marcus: Yeah, I mean there's nothing more to say other than like the, I think the Fed is accurately tracking what consumers are concerned about. 

[00:15:12] Vic: Yeah. 

[00:15:13] Marcus: Yeah. Um, yeah. Alright. Retail sales edge up in February, but missed expectations and, uh, I think they also, um, redrew the, the numbers for January, right?

[00:15:22] Vic: Yeah, that's right. The commerce provider, they revise January down. So, I mean, all of these stories are sort of intertwined, right? Like consumers are feeling worse. They don't buy as much at the mall or at a store or online. 

[00:15:34] Marcus: Um, Vic, we've been doing this show for two years. Have we ever had a Happy Economy section?

[00:15:42] Marcus: I don't think so. No. 

[00:15:44] Vic: It's, there's been times when the stock market went up. Only been able to point to Yes. But there hasn't been a good 

[00:15:54] Marcus: economy. Yeah. The stock market has gone up and inflation has come down. [00:16:00] Yes. And the third thing I will point to is GDP grew. So those three things all occurred Yeah.

[00:16:10] Marcus: Over the time we've been doing this show. But for the consumer, like it doesn't feel like this has been a good economy. Yeah. The um, lots of layoffs. Yeah. The entire time we've been doing this show. Yes. Lots of layoffs. 

[00:16:30] Vic: Yeah. The GDP growth, I mean, I don't have the facts right now, but it was a lot of government, uh, spending of course, which didn't necessarily flow that.

[00:16:44] Vic: Evenly to, to the overall economy. No. So like the number, the GDP number, right, was good for the quarter, for the month or whatever, but, but didn't, you didn't really get that like buoyant. Everyone in downtown Nashville feels like we're all, we're all doing better. That's [00:17:00] right. Um, and unfortunately, I think that's the trend we're on.

[00:17:07] Marcus: The Trump team explored simplified plan for reciprocal tariffs. And so we are, we're closing in now, April 2nd is our target date. And instead of, um, picking particular fights with certain countries, it looks like we're simply going to assess whether there's a tariff on us. And if so, we're gonna place the equivalent tariff on them.

[00:17:29] Vic: Yeah, that's right. And I think it's taken since the election for Trump and his team to try to figure out how to implement this. But it's a, it's a simple and, and really easy to understand framework, which is why I think Trump likes it, which is we're gonna have the same reciprocal tariff that they have on us.

[00:17:49] Vic: And so if a country like Mexico or Japan or China, any country you wanna name has 10% tariff, then we're putting that on them. [00:18:00] And if they wanna reduce that to five, then we would also, we, we would encourage everyone to reduce it in a reciprocal way. The issue is that it's difficult to measure that, and some countries, including the US, try to protect particular industries.

[00:18:21] Vic: And then of course, each country's GDP is of different size. And so are you waiting the, the total dollar amount or the percentage? It gets super complicated to try to implement, but I, I think, but messaging wise, but messaging is good. And they are planning to roll out something, uh, in some kind of tiered system that I think will be better than the haphazard thing they're doing now.

[00:18:51] Vic: Um, so I'm hopeful there 

[00:18:54] Marcus: more about the growth of stock exchanges in, in the state of Texas. [00:19:00] Nasdaq plants a second US headquarters in Texas and this terrible, terrible name for the growth of stock exchanges in Texas that needs to die. Uh, y'all street, it's awful. Yeah. I'm not gonna use that. Awful. 

[00:19:19] Vic: Yeah. So the Texas Stock Exchange has already started down there.

[00:19:24] Vic: NASDAQ is opening an office. We're we're gonna have a, 

[00:19:28] Marcus: and the, and the Texas Stock Exchange is the New York Stock Exchange. 

[00:19:31] Vic: It's 

[00:19:32] Marcus: it's a, yeah. It's moving their Chicago. Yes. Right. Alpha to, to Texas. 

[00:19:36] Vic: Yeah. So we're gonna have the NYSE and nasdaq, right? Having New York and, and Dallas. Yeah. And that's, I, it's gonna take that as positive, but it also is creating this, you know, two more of a two, two different segments of the US [00:20:00] country that are now more self-reliant, which is maybe okay, but also, well, the economy 

[00:20:08] Marcus: appears to be legitimately bifurcating.

[00:20:14] Marcus: Yeah. But that's not, I don't know if that's good. It's not good. It's not good. Right. Um, but it appears to be like, you know, I mean the, the, the lightning rod for this is Tesla, right? Mm-hmm. Um, I mean, Tesla's literally the reason why these stock exchanges are moving. Yeah. Um, they're the ones driving all the outflow of companies from Delaware and, you know, people are vandalizing Teslas, um, setting them on fire, arson attacks, um, you know, people who maybe liberals and, and, and bought a Tesla in the beginning because it was, you know, good for the environment.

[00:20:56] Marcus: Yeah, yeah. Now are are are worried change, you know, looking to sell their car, [00:21:00] whatever. I mean Yeah. There, there's a real bifurcation, uh, of the economy happening. 

[00:21:05] Vic: Yeah. And I think these are, I wanna separate these two things. The, the move from Delaware to Texas was related to Elon Musk's CEO pay policy, I think.

[00:21:18] Vic: Mm-hmm. And. You're being precise now. So I'm gonna, I I'm gonna track what you're saying. Yeah. So I think it should be allowed for a board to incentivize a CEO in assuming that the shareholders vote on it. We, we, we, in whatever way they want. We discussed this week. Yeah. We discussed it. So that, that I think was an unforced error by Delaware.

[00:21:44] Vic: I, I don't know why they did what they did. Mm-hmm. It doesn't make sense to me. 

[00:21:48] Marcus: Well, it was prob it was probably political nature. 

[00:21:52] Vic: Yeah. Maybe. I don't know. Probably. Um, and then you have the sort of [00:22:00] Trump slash Elon, um, doing Doge, I think that has driven the vandalism and all of the problem fires and question issues at Tesla right now.

[00:22:12] Vic: No question. No question. Um, I don't 

[00:22:14] Marcus: think, well, well, well, that, and also like I. X. I mean, you know, if you're on X and you see e like Elon is so incredibly derogatory to the left and Democrats. Yeah. I mean it's, it's the, you know, he can't possibly care about Democrats being customers of his, the way he talks about them.

[00:22:34] Marcus: It's just, you know. Yeah. And I don't, 

[00:22:37] Vic: I don't think anyone should buy a product that they don't, they don't, of course not like the product course, not like the person running it. That's the free market. But I don't think vi I think, I think we need to try, draw a line at, at violence and setting fires and shooting stuff co Completely agree.

[00:22:53] Vic: So, yeah. 

[00:22:54] Marcus: But circle back to your point. Your, your point was, was around the difference. Well these are, 

[00:22:57] Vic: these are two different things. So, yeah, I think the [00:23:00] Delaware not upholding the, the incentive pay started this whole move to Texas. Mm-hmm. And it is probably now got a life of its own, but that, that. Is different than Elon's political endeavors, I think.

[00:23:20] Vic: But maybe they're all tied 

[00:23:20] Marcus: together. I think, I think they're pretty closely related. I think they're pretty closely related. I, because here's the thing, even if, even if you impact Elon's companies directly, I think the thing you can't impact is how incredibly influential he is to, um, the business leaders who are aligned with him and what he currently stands for.

[00:23:44] Marcus: He's, you know, you know the Mark Andreessens of the world, or you, you know, he, he, he is held in the highest regard by, by. So, and, and I, I think this is probably one of the things we we're, we're diverging a [00:24:00] little bit here, but I think this is actually one of the really weak points, um, of the left. When they talk about Elon, you know, they say things that are just like categorically like untrue, like, like he's not very smart or, you know what I mean?

[00:24:15] Marcus: Like, they say these things and you just can't be taken seriously, making those kind of comments. You, you know what I mean? Like, yeah. I mean, have you, have you, have you seen a SpaceX launch in landing right before? You know what I mean? Like, so if, if, if you wanna stick to the fact that he's derogatory, his involvement in, in the, you know, his involvement in the last, uh, uh, in, in, in the election, particularly in, in, in the, you know, uh, state of Pennsylvania is questionable.

[00:24:42] Marcus: Like, like if you wanna sort of focus on actual things. Yeah. I think that's far more effective. I don't think the, i, I don't think the violence, uh, well let, let's not say violence. Let's, let's just talk about like, uh, destruction of property and, and vandalism and, because I, I'm just not sure of anyone being hurt yet, [00:25:00] so.

[00:25:00] Marcus: Yeah. Um, but, but that stuff, that's just, that's not. That's not helpful. You know what I mean? That doesn't advance anything. But, but no, I mean, Elon is, is, is a massively, massively in influential person. And I charge him, um, as being, uh, and I don't say this negatively. I, I, I charge him as, as being sort of the key influencer driving, uh, the stock, these stock markets, uh, to, you know, to, to move into, into the state of Texas.

[00:25:29] Marcus: I think he's the, I think he's the, the, the fulcrum 

[00:25:32] Vic: Yeah. 

[00:25:32] Marcus: Of that movement. So, alright. Moving into vc, inspiring banks, 35 million to scale AI powered senior living technology. 

[00:25:39] Vic: Yeah. So this is really interesting. Uh, senior living, it's a really hard business. You have a lot of seniors and then you have their families and they need support.

[00:25:50] Vic: They don't have that much revenue flowing through for all the work they have to do. Yep. And so this is a sort of a all inclusive AI kind of operating system. Sure. [00:26:00] That works with is, is work with each senior, but also helps run the, the overall, uh, singular facility. Okay. It's a great idea. Um, whether they can get adoption with this user base, I don't know, but, but it, it, it could be great.

[00:26:16] Marcus: This user base needs, needs new technologies. No question about that. Yeah. Uh, third prime, local, local, uh, uh, venture firm, uh, is in the deal. Avenir is the, is the lead on it. So, um, some good firms, uh, behind this one. Yeah. Best of luck to 'em. I have no idea how to pronounce this pro. Yeah, let's try that. I think so.

[00:26:34] Marcus: Yeah. Pro pulls in 50 million for digital pathology. 

[00:26:37] Vic: Yeah. So, you know, digital pathology is basically looking at cells and, and lab, you know, blood work. Um, it's hard to digitize. 

Mm-hmm. 

[00:26:50] Vic: And so, um, they have been working on it for. A long time. This is another round, and I hope it is successful. It's, it's a difficult [00:27:00] transition from, I mean, if you take A-A-M-R-I or, or an image, it's already digital.

[00:27:07] Vic: The, the, you know, the, the slide work is wet lab work really. And so digitizing that to a format that can be then useful has been the real bottleneck. But, um, it'd be great if we can get it, get it there. 

[00:27:23] Marcus: Okay. Um, so looking at who's around the table here? Uh, alpha Intelligence Capital's, US Fund, triangle, peak Partners, avenue Capital Group.

[00:27:33] Marcus: Um, not, not names. I'm, I'm, yeah, I, Don Ter, I'm terribly familiar with, uh, the, the CEO basically positioned us as saying this round helps us to get to a public scale company. And so I think they're, they're looking to IPO after this round, so, you know Yeah. For runway purposes. So I think your point is, is stands, which is the technology here is very, very difficult.

[00:27:53] Marcus: Met Logics. Yeah. So Dan Company, our old buddy, Dan Hogan, uh, and for Kura, merged to form a $1 billion [00:28:00] healthcare software business. So, so Dan was the founder of Met Logics, wasn't he? Yeah. Yeah, yeah, yeah. And then, and then, um, oh man. Uh, ROS company. Yeah. A Meis, uh, a Meis, uh, bought a control. They bought controlling, I don't know if they had had 

[00:28:12] Vic: control, but they significant stake, significant, 

[00:28:15] Marcus: significant stake.

[00:28:15] Marcus: Dan, I think Dan left. Dan left. Yeah. Yeah. Yeah. Dan Dan's doing more fun things. Yeah, right. Uh, now working with Clint Smith. Uh, but, but yeah, met Logics and for QRA merged, they form a billion dollar ware software business and Berkshire Partners is a leading the combination. 

[00:28:31] Vic: Yeah. So I, I think it's, it's great to see it sort of grow into this and, you know, have a more independent future after edis, you know, sold to United it.

[00:28:45] Vic: I feel like Met Logic was just kind of like lost in there. So, um. It's great to give it, give it, its, you know, chance to have a whole life. Sure. 

[00:28:53] Marcus: Alright. Uh, this is Israeli startup, just inc, the largest cybersecurity deal ever. So this [00:29:00] is, uh, the Google whiz deal that last summer fell apart and now it's on, so it's a $32 billion deal.

[00:29:08] Marcus: Um, and, uh, wow, that's a massive, massive, massive deal in the cybersecurity space. So, not really, you know, healthcare, but I think it's, it's important because the deal fell apart last year and it was, it wasn't clear whether or not it was because Wiz wanted to go it alone. They thought that dollar amount wasn't sufficient, et cetera.

[00:29:26] Marcus: But, um, here they are finally, uh, getting the deal done. 

[00:29:30] Vic: Yeah. And I, it's not healthcare, but we have a lot of cyber issues in healthcare. Absolutely. And then it's gonna be the f the, we'll talk about another FTC thing in a minute, but it's the first big FTC question for the Trump. FTC and Justice Department, are they gonna allow this or not?

[00:29:47] Vic: Google does not dominate cloud and so adding a cyber cloud security platform when they're probably the third, they're third, they're third behind Microsoft and Amazon. It should be, I would think it'd be [00:30:00] okay, but we'll see. It was a $30 billion acquisition, so certainly would be looked at and it will help us better understand the position.

[00:30:10] Vic: Lemme say if they fight it and try to stop it, that will send a message 

[00:30:15] Marcus: different than if it just goes through. That's right. And the FTC is starting to get active as we're gonna discuss here in a little bit, um, GS R Venture spins out new branch informed. Inform me, but informed ventures with tenured partners.

[00:30:28] Marcus: So this is a, a net new, uh, VC firm investing in digital health startups and, uh, software as a service consumer products. So $200 million fund. Um, they've got physicians, entrepreneurs, engineers, uh, on board, and, uh, yeah, we've got a, a, a net new healthcare venture fund in America. 

[00:30:46] Vic: Yeah. And, and I think it's, it's positive to all to have a new money coming in.

[00:30:52] Vic: Always. And then they, they do have a lot of actual healthcare experienced folks around the [00:31:00] venture that are physicians or policy. And so I, I think they have the right set of experiences, which 

[00:31:06] Marcus: Yep. Alright. A couple of, uh, analyst posts here from HFMA. So the first one, uh, from Nick Hutt is, uh. Doing a roundup on Dr.

[00:31:16] Marcus: Oz and how he describes changes he would, uh, bring to Medicare, Medicaid, and, and CMS as, um, as the administrator. 

[00:31:23] Vic: Yeah. And I think he's been pretty transparent about how he's thinking about it, but, um, basically it's focusing on the recipients and trying to, trying to help the, the Medicare and Medicaid recipients at the end of the day, get better care.

[00:31:43] Vic: And I think that's his North star now. He's gonna make lots of decisions along the process, but that's probably, probably good. 

[00:31:52] Marcus: Yeah. Okay. So, I mean, I, I don't know how. How different that would be from what other administrators in the past would say. [00:32:00] That seems like the charge of Yeah. Maybe. Of, of, of the, of the agency.

[00:32:04] Marcus: So let, may maybe let's dig in a little bit more. Um, so one of the things that the article focuses on is, is this idea of better tools and more transparency. Um, I mean, look. Medicare and, and Medicaid are, uh, dealing with challenging populations. I would say particularly with technology, um, the ability to reach those populations.

[00:32:28] Marcus: Mm-hmm. And for them to like be able to understand what you're trying to, you know, communicate with them just because they may not be effectively resourced, um, or like, you know, as digitally literate. Um mm-hmm. It, it's, these are, these are hard things, you know? Um, yeah. Like if I'm just taking like my, my parents for example, I mean, I am the digital front door for them, right?

[00:32:50] Marcus: Yeah. Everything kind of runs through me and, and then gets to them. So maybe better tools helps the responsible child of, of many, many, uh, Medicare recipients. You know, in the case of Medicaid, I [00:33:00] remember back when we were working with Hugh Hale, uh, you know, at at Tencare. 

[00:33:04] Vic: Yeah. 

[00:33:04] Marcus: One of the big challenges was reaching.

[00:33:06] Marcus: Right. You know, um, people, uh, you know, Medicaid recipients, right? Like just even reaching them was of, of, uh, significant difficulty. Like forget better tools and transparency. I mean, that's, that's assuming you can even reach 'em in the first place. So anyway, yeah. I think that there's no question 

[00:33:22] Vic: about that.

[00:33:23] Vic: I think that some of this thrust towards transparency is getting the. The hospital and insurance company prices more out in the open and transparent. Not necessarily 'cause your dad will look at it, but because of venture capitalists like me, might see a market where I should go open a new thing because it's very lucrative in that market.

[00:33:45] Marcus: Yeah, yeah. Uh, Medicare Advantage. So I think everyone was kind of edge of their seat waiting to see where he was leaning here. And it sounds like he feels that there is a lot of upcoding, um, and it's happening systematically. [00:34:00] Um, and that there's, there's work to do to sort of clean up some of the practices inside of MA today.

[00:34:05] Marcus: So this, this may mean MA is a, is going to be, uh, a less profitable, um, you know, line of business for, for, for payers in particular. 

[00:34:15] Vic: Yeah, that, that's right. I think it's gonna be a challenge to even figure out where Upcoding is going on and stop it because. There are, I mean, you, you can more accurately diagnose someone and get them to a higher risk pool and not necessarily violate the law through attention.

[00:34:42] Vic: Yeah. And calling people and asking them what their symptoms are. Yeah. I don't think that's illegal, but, but that is what. Many MA plans have done sort of systematically to increase their 

[00:34:53] Marcus: billables. Yep. Uh, prior auth. I mean, I think everyone agrees this is an area of, of significant [00:35:00] opportunity to streamline this.

[00:35:01] Marcus: Um, it's, it leads to a lot of dissatisfaction for patients. Yeah. And it's, you know, and providers. So I think providers get really frustrated with the prior auth process as well. Yeah. So that's, that seems like a simple one. And then on the topic of Medicaid, uh, it seems like the focus here is on the enrollment itself, so less about particular programs, um, which I think a lot of people were worried about and more about, hey, who's actually enrolled in Medicaid and should they be enrolled in Medicaid?

[00:35:26] Marcus: Um, so, you know, and I guess his position here is, you know, if you've got people who are enrolled in Medicaid who shouldn't be, you're actually taking, you know, away from the people who absolutely need it and who the programs were designed for. 

[00:35:38] Vic: Yeah, I think that's right. And that's certainly what he said.

[00:35:41] Vic: I do think there's gonna be some attention and supplemental payments. He didn't talk about that. 

[00:35:46] Marcus: Yeah. Uh, and then the final point here is rural healthcare. So he's in favor of telehealth for rural healthcare. Thank God. Yes. That seems very, like, obvious, but no one has said that before him. Obvious. No one has like actually just come out and just said those words.

[00:35:58] Marcus: So I thought that [00:36:00] was, that was really, yeah. Nice to see. He was just, you know, unafraid to make it, make it very clear where he stood on that. And then, uh, the second post here from Nick at HFMA is, uh, around the Trump administration charting a new course at the Center for Medicare Medicaid innovation. So CMMI, um, and basically shutting down for, um, alternative payment models, uh, the Maryland total cost of care, primary care first, ESRD, treatment choices, and making care primary.

[00:36:28] Marcus: So all these models will end by the end of the year. 

[00:36:32] Vic: Yeah. And, and I think they have not been successful at reducing cost and improving outcomes. And so I, I liked the concept that Steven and I would. Try new things and innovate and test models and push towards value-based care. And also I think they have collected a bunch of data saying that it didn't actually have the results they wanted.

[00:36:56] Marcus: Alright. Uh, the story from, uh, wall Street Journal, pro Venture Capital startups Prep for [00:37:00] potential Medicaid cuts. So the, I'm glad you included this because I've been asked, you know, several times by investors, by LPs in particular. Yeah. You know, Hey, what are your thoughts about the potential Medicaid cuts?

[00:37:13] Marcus: I mean, they're likely to come. How does this impact your fund? Right. And my answer has been, I think a lot of what this article says, and this is basically talking to different VCs so that, you know, and the, the point that the VCs are making here is that cuts should drive more appetite for efficiency and innovation.

[00:37:35] Marcus: Um, if that actually is going to play out. I guess I've, I've finally been in healthcare long enough to where I'm a little cynical a about, you know, uh, these kinds of pressures actually driving adoption for, for innovation. Um, I feel like I've seen multiple things that should have resulted in that and have not resulted in that.

[00:37:57] Marcus: Yeah. But, but I think, I [00:38:00] think, um, the idea here should be we're gonna have the same number of people and we're gonna have less money. And so we need better ways of caring for these people. And, uh, venture-backed startups should be one of the, the ways that we sort of address that, you know, that gap. Yeah.

[00:38:21] Marcus: So, 

[00:38:21] Vic: yeah, I think that's, I think that's right. The, um, finding ways to deliver care more effectively. Um, less expensively, I think. Is going to be an opportunity no matter what happens with regulations. Um, as I said in the last story, I think supplemental payments might go through a lot of changes. So if you rely on that for your business model, I think that would make me cautious.

[00:38:56] Vic: Uh, but I, the last investment I made was in a pediatric [00:39:00] physical therapy, occupational therapy company, and they, they're a hundred percent Medicaid. Mm-hmm. But they're using telehealth to increase the number of, you know, available visits by a little over 200% in, in a, in a place where about 30 states have shortages.

[00:39:18] Vic: So I think we're gonna, we're gonna need to find ways to do stuff like that where we can help the patients in a way that's cost effective. 

[00:39:26] Marcus: Yep. Yep. Agree. Trump fires two Democratic FTC commissioners and the new chair, Andrew Ferguson defends the decision. So, um, the FTCI think is, is an agency that is of great interest to Trump, um, obviously trade.

[00:39:43] Marcus: Um, and this is, uh, gosh, where, where to even start here. Trump is sort of showing us where things were, conventions and not laws, right. This, this whole three, two thing. You know, we talked [00:40:00] about this so much during the Biden administration, right? Yes. You know, three, three Democrats and two Republicans. And, you know, we would often talk about this in the context of the SEC and the FTC.

[00:40:09] Marcus: Yeah. Those two agencies in particular, right. Um, because the, the minority is there. Expressly for the purpose of dissenting and at least presenting the other party's view Yes. On, on the topic. Right. And that's helpful for the American public, even if it, even if you know, the party that is uh, in the White House is going to have the advantage and pretty much a hundred percent of the time win the votes.

[00:40:39] Marcus: Right. Um, having the dissenting voice be present is, is valuable. Right. So you don't need to have all five. Right? 

[00:40:51] Vic: Right. 

[00:40:52] Marcus: It's to, to get your 

[00:40:53] Vic: agenda done. I would say it actually is gonna impair the FTCs ability to get their agenda done. 'cause when [00:41:00] they go to court, so say, I don't know if they're gonna block it or not, but say they decide they wanna block Google's attempt to buy this company, whiz, it doesn't matter if they do or not, they're gonna try to block something.

[00:41:11] Vic: They'd have much less credibility going to the court because there. There certainly is less opportunity for a healthy, diverse debate internally that would give them a credible position for the court. Um, so I think it actually makes it less likely that they would get their things approved. 'cause usually the company would, would fight it.

[00:41:43] Vic: Um, but the last FTC didn't have great success in court, so I mean, I don't know. Maybe it's, I think Trump is showing that there are a lot of things that are matter of convention and he doesn't care about that. No. He's just running over that. 

[00:41:58] Marcus: No, not one, not one bit. [00:42:00] Um, and, and, but. I guess I just look at this and, and, uh, I don't understand it.

[00:42:08] Marcus: Um, it's gonna be challenging the courts and, and, and all the things. Right. Um, I don't know why he wants it, it doesn't make sense to me. It, it's not clear to me either. It's not clear to me either. Like, unless, unless you want absolutely no dissent and that's, you know, that, that gets into a whole other conversation that is very uncomfortable.

[00:42:33] Marcus: Yes. 

[00:42:33] Vic: And it's not good on a lot of fronts. So that might be in fact the reason, but that's still not good. We'll, we'll, we'll leave that there, but, 

[00:42:42] Marcus: yeah. Yeah. But, but why else would you need it? You, you don't, you don't need to have all the commissioners in your party in order to, that's not, you don't need that.

[00:42:53] Vic: Right. And I think actually in some cases it's not gonna be helpful. 

[00:42:58] Marcus: Yeah. No story here on the [00:43:00] FTC. They push back again on, uh. An Indiana Hospital merger. This is the second attempt, and I think this is, this is important because Lena Collins, FTC was very, very, very aggressive in, uh, working with state ags and, and blocking these kinds of mergers.

[00:43:23] Marcus: And here we are under Trump's ftc. 

[00:43:27] Vic: Yeah. 

[00:43:28] Marcus: And they're continuing with that. So this is, uh, a nonprofit, um, that has been owned by HCA and now they're looking to, you know, merge it in with, with another nonprofit. Well hold on. The HCA a's facility is for profit, I think. But HCA bought, when HCA bought it, it was nonprofit.

[00:43:52] Marcus: Oh, okay. Yeah, yeah, yeah. When they bought it was not. Yeah. Right. Yeah. Yeah. So it was a nonprofit, HCA bought it, and it was part of one of these like crazy COPA deals. [00:44:00] Yes. Right. These, these, these public agreements. Now they're trying to sell it. Yeah. Now, HHCA is trying to sell it. Um, and you would think, okay, selling it off, getting it back into the nonprofit, it's more community based.

[00:44:11] Marcus: Like that would be good. Um, but there is a general view by many conservatives that hospital mergers are bad for the public and that they, um, stifle competition. Now, if you're the FT ftc, I'm not sure how closely you're actually tracking this deal of a 341 bed hospital. You know what I mean? Yeah. Um, but, but look, I mean.

[00:44:46] Marcus: I think at the same time, if you're simply trying to start to lay out your, your view on these things, this, this would be the first, the first deal for you to bring up, you know? And, and HCA, [00:45:00] it was during the Biden administration, weren't they looking at, um, acquiring a hospital in Utah and then, you know, kind of the FTC put laser eyes on it, and then they just kind of backed away and they said, okay, forget about it.

[00:45:14] Marcus: Yeah. We're just gonna, we're just gonna focus on operating, you know, this might've been them saying, okay, we're in a new administration. Let's, let's let, let's, let's see, let's see, let's see, let's see. And it looks like they're starting to kind of see what, what this looks like. 

[00:45:28] Vic: Yeah. I mean, I guess, uh, I'm of two minds in Terre Haute, Indiana, which I've, I've never been there, so I.

[00:45:37] Vic: I don't really know. Yep. But I don't know if we need two hospitals, 1 340 and 1 298 beds. Yeah. So that's, I'm not sure you need that much. Yeah. So 

[00:45:45] Marcus: that's the viability mind. 

[00:45:47] Vic: That's the viability. Like is it possible to Right. Keep these two functioning. Right, right. Um, but I do agree with the FTC that it, it, it, it reduces [00:46:00] competition.

[00:46:00] Vic: There's no question. It reduces competition. If you are a doctor or a nurse or a anyone interacting with those health systems, you now would have only one employer to negotiate with, or you have to move some miles away. But if it's not viable to have two facilities of that size, that doesn't really matter.

[00:46:25] Vic: I mean, it does, it's not viable. You don't need competition in tiny markets that can't support the competitive landscape. So. I don't know. I, I don't understand their framing, but, but they projected it. 

[00:46:42] Marcus: RFK, Junior's Health and Human Services picks up Biden administration's legal fight against three 40 B rebates.

[00:46:48] Marcus: So this is, um, RFK now, you know, starting to establish his position and, um, he has taken this side of the hospitals and not taking the side of, [00:47:00] um, the pharmaceutical companies. That's not surprising at all, but I guess the hospitals need a win. 

[00:47:06] Vic: Yeah. And it's good to have, so good to have some good news for the health systems.

[00:47:10] Vic: Yeah. Um, yeah, I think, um, three 40 B needs to be, uh, let's say updated and, and evolved. We'll have a story later that some startups are working on it. I think, um, the pharmaceutical industry. Uh, suing everyone and trying to just like blow it up maybe isn't the best way to go it. So I'm happy that Kennedy is fighting back and it's gonna be a long process.

[00:47:37] Marcus: I mean, three 40 is just a trap, right? I mean, it just, it just shows you how complicated the healthcare industry is. You create something for the purpose of trying to benefit, um, you know, poorer populations. Yeah. And, and it's, it's a mechanism that seems pretty straightforward and should just work. And it's like, 

[00:47:54] Vic: it can get, it can get contorted to do, it gets contorted, lots of other things.

[00:47:58] Vic: Yeah. It gets 

[00:47:58] Marcus: contorted to do a lot of other [00:48:00] things. And, and then, you know, the way that our industry works, it's like certain factions are mad about it because they're not getting the, you know, th this was not the intent of this program. Right. You know, if you're gonna be selling it to people who they shouldn't get it, you can't use it to bolster your p and l and Yeah.

[00:48:19] Marcus: You know, it's just, 

[00:48:20] Vic: yeah. You have. You know, I don't know, a wealthy pharmaceutical company. I'm not gonna name which one. Fighting against a, a wealthy ish, um, pharmacy company. And that's not talking about the actual people that we were trying to help. No, 

[00:48:37] Marcus: no. So it's, it is just, uh, you know, we'll let them work it out.

[00:48:41] Marcus: Uh, the Trump administration is weighing major cuts to funding for domestic, not international. This is not Africa. Like, you know, this is, you know, all the Doge, USAID stuff, right? Um, for domestic HIV prevention. So, look, we talked about this before we hit [00:49:00] record. Um, when you are trying to cut the deficit in the way that this administration is trying to cut the deficit, um, almost everything is gonna be on the table and you're gonna start hearing some.

[00:49:14] Marcus: Uh, you know, some headlines that kind of turn your stomach when you think about the idea that we're going to, uh, cut funding for those things, you know, for me, um, knowing the, you know, the populations that, that still struggle, um, with the HIV virus, you know, this is not, this is not happy, you know, there's a, you know, there's a picture in this article of, of, you know, people with, with brown skin, right?

[00:49:37] Marcus: Yeah. I mean, you know, so this is, this is, uh, um, and, and it's at the Harlem Pride Parade, right? So this, this is, uh, you know, it, it feels like it can be targeting certain populations. Um, and, and when you look at the numbers, I, I think it's, it's just, it's just once, it's gonna get people, you know, very, [00:50:00] very emotionally riled up.

[00:50:02] Marcus: And we have to find ways to not be so. Triggered because there's gonna be a lot more of this. You know, so, so I, I don't, I don't say this from the perspective of like, Hey, if you're opposed to this, don't fight. I say this from the perspective of this is one of so many headlines like this. It's gonna be so hard for people to, you know, deal with and, uh, they're not gonna stop coming, that's for sure.

[00:50:29] Vic: Yeah. Well, I, I agree with that. I mean, I think that we are changing the way we review these things now for the last 50 years. It's been, if we can do it, we should, I think. Yeah. Yeah. Like if we can prevent HIV we should That's right. Period. Full stop. That's right. And now we are saying we can no longer print unlimited money and we need to weigh the cost and benefit.

[00:50:57] Vic: And that's a hard transition. I, [00:51:00] I agree that we have to make that transition. Well, but it's a hard process. 

[00:51:04] Marcus: Well, the, the reason why it's a hard transition is. Because the, the previous stated position, uh, refused to acknowledge our balance sheet as a country. It just, it just wouldn't even talk about it.

[00:51:22] Marcus: Yeah. It should just say, no, no, we, we, we'll be fine. We, we, we should do this. We should do this. Right. Like, we're finally, finally having a real conversation. Not a theoretical Yeah. Not a think tank. Not an academic. Right. Not, not a, wow. Look at that debt clock. Isn't that a shame? Yeah. Like, we're finally having a real conversation about the balance sheet, and it's like sins of the father, you know, honestly, it, it, mm-hmm.

[00:51:48] Marcus: It, it reframes all of the past decisions in this new light where we [00:52:00] have to realize all of those really amazing, great things we did. We did so without. Much fiscal responsibility in mind at all. 

[00:52:10] Vic: Mm-hmm. 

[00:52:12] Marcus: You know? 

[00:52:13] Vic: Yeah. Yeah. And we're gonna make lots of mistakes on like what to cut and where to go, but, but getting to this point where we're actually having real discussions and we're gonna cut somewhere.

[00:52:27] Vic: That's right. Okay. So we gotta cut a trillion dollars. We spend 20 trillion, so 5% has to be cut. What are we gonna cut? That I think has never been done in DC Maybe, maybe there's been a year or two when it's been done. And so it's gonna be hard. People are gonna be upset and it's gonna be hard. There's gonna be some benefits that are taken away.

[00:52:51] Vic: Yeah. 

[00:52:52] Marcus: Yeah. It's, it's, it's, it's, it's gonna be rough. I don't like this headline. I, I'm sort of outing myself. Yeah. I mean, this is, this is not a good headline for me [00:53:00] to read. 

[00:53:00] Vic: I mean, no one in America should die of HIV. No. And. It does take a lot of effort and money to get to the populations at risk who do not read the Wall Street Journal.

[00:53:15] Vic: And so I understand that you have to get to the, whatever it was called, the Gay Pride Parade, that's probably not the right name of it. Um, and be out there at the parade teaching people and that costs money. Yep. And at the same time, I think we need to figure out how to cut 5%. 

[00:53:33] Marcus: Yeah. Alright. Cigna finally closes their $3.3 billion sale of their Medicare plan to HCSC.

[00:53:39] Marcus: So congratulations to Cigna. This is, I think, a great deal for them. They're now, um, a much cleaner story for Wall Street. Mm-hmm. Um, a very clear, pure play, uh, commercial insurer, um, with a growing payvider business, uh, in, in their ev ever north unit. And they don't have this, [00:54:00] this Medicare advantage albatross around their neck anymore.

[00:54:03] Marcus: So good for them. 

[00:54:03] Vic: Yeah. They've been trying to get themselves to this position. I think it's gonna be, it's good. 

[00:54:08] Marcus: I 

[00:54:08] Vic: agree with you. 

[00:54:09] Marcus: Yep. Employers get big drug discounts through program for hospitals that serves poor patients. So this is back to the three 40 B. This is an innovative innovation story. We've got sort of a fleet of net new companies that are coming out, partnering with employers, looking over their, their employee base and basically saying, Hey, you know, you have a bunch of these employees where you should not be paying these kinds of, uh, pharmaceutical rates that you're paying and let's just route them to a better place, a better pharmacy, which is gonna be the three 40 B pharmacies.

[00:54:42] Marcus: Right. Right. Um. And that is good for the employers. Lower cost. It's good for the employees. Again, lower cost good for the three 40 B hospitals because more volume. 

[00:54:56] Vic: Yeah. So the pharmacy that they're choosing is the [00:55:00] hospital's pharmacy. Yeah. 

[00:55:00] Marcus: Yeah, 

[00:55:01] Vic: yeah. Exactly. 

[00:55:01] Marcus: Yeah. So that's good, right, because that's more volume.

[00:55:05] Marcus: Yeah. Right. Um, and they get, they get fees. I mean, you know, they're not getting the, the, the spread, 

[00:55:09] Vic: they're not getting as much lucrative. Right. Three 40 B as they would otherwise, but they get the patient population coming in. Right. They get the patient population. 

[00:55:15] Marcus: So that's good. Bad for standalone pharmacies.

[00:55:20] Marcus: Yes. Bad for Walgreens CVS. 

[00:55:24] Vic: Yeah. And it is much closer to the original intent. It's not exactly the intent. Yeah. But, but it's much closer. And so this is what I was thinking about when I said that the market might do a better job than people fighting in court over how it works. Uh, but maybe we need both end.

[00:55:43] Marcus: Highmark posts $29.4 billion in 2024. Revenue amid ongoing rise in utilization. So here are the key numbers here for Highmark Health. 29.4 billion in revenue, 50 million in net income, but 209 million in operating losses. [00:56:00] So, you know, what's the beauty of a very, very large balance sheet Insur, balance sheet insurance company, you might have a bad year from an operations perspective 'cause utilization is really high and you can't keep your, your, your, your medical rates down, but you got a balance sheet.

[00:56:15] Marcus: You're investing, you, you know, s and p was up 20%. It made 

[00:56:18] Vic: $250 million in, in your asset base. Exactly. So, so, so 

[00:56:23] Marcus: you're up 50 million right. At the end of the day. So it's, it's nice to have that balance sheet, that's for sure. 

[00:56:27] Vic: Yeah. Um, Highmark's a good well run payer. I, I think it's good to follow them. It's hard, I mean, it's hard to operate as a payer.

[00:56:37] Vic: No. So like, they're. They're not as big scale as the nationwide players, but they're pretty, pretty big scale and concentrated. 

[00:56:45] Marcus: 29 and a half billion is, 

[00:56:46] Vic: that's decent. Yeah. That's decent size. And it's tight. Yeah. Yeah. So it's, uh, what struck me is just how I think they run a pretty good operation. I don't know a lot of people there, but they seem to, that's a lot.

[00:56:57] Marcus: That's not a lot of net income on almost [00:57:00] $30 billion. Right. That's, that's what I 

[00:57:01] Vic: was going to. Right, exactly. So it's, I think the insurer payer side almost, no matter where you are, it's a hard business. Is a hard business. Hard business getting hard. Yeah. 

[00:57:09] Marcus: Yeah. Mass General Brigham announces a $400 million cancer care investment ahead of the Dana Farber split.

[00:57:15] Marcus: So we've been covering Mass General here for the past, you know, couple of months. And the stories have been bad. Layoffs, operational misses. Um, one thing we know about health systems, um, cancer care generates a lot of money. Mm-hmm. Um, a lot of money that gets thrown to the bottom line. And so I think this was, you know, probably.

[00:57:36] Marcus: Uh, and, and an important investment for them to, to stop the bleeding, right? Mm-hmm. You know, they probably had to reach into the balance sheet and make sure that their cancer care business was, was solid. 'cause they're gonna need that to continue to get through this turnaround there in the middle of.

[00:57:50] Vic: Yeah, it's interesting. It's, um, I don't have it fully formed in my head, but the business of running a health [00:58:00] system is evolving, right? Like Mass General Brigham is, is I think clearly prioritizing oncology, investing in oncology. It says recruiting top oncologists to come join. At the same time they're having two rounds of layoffs and cutting in other areas, and oncology and cardiac and orthopedic.

[00:58:24] Vic: There are lines of, of treatment, lines of business in the health system that are very profitable. And there are other ones that are not profitable and. Yeah. That just is the way the reimbursement is set up now, and I think it's, it's exemplified in mass gender laws. They're doing layoffs a month ago and now they're investing $400 million in oncology.

[00:58:46] Vic: Yep. 

[00:58:47] Marcus: So look, we're, we're just gonna kind of continue to watch. 

[00:58:50] Vic: It's not good or bad, I mean, 

[00:58:51] Marcus: just is No, it just is that way. No, no, no. This is how it's, well, well, they're, they're, they're about to lose their, their cancer care partners to, they have to do something. Have to do something. Right. They have to do something.

[00:58:58] Marcus: Uh, this is a pretty big story, I [00:59:00] think. Uh, dispatch health and medically homes, these are two of the big, um, at-home hospital companies. Uh, they are merging, creating one of the nation's largest hospital at home providers. Um, I think we need to point out, again, we talked about edis earlier. Mm-hmm. With Met Logics and Meis also, um, acquired Contessa.

[00:59:18] Marcus: Yeah. Which was a hospital at home business, uh, that was founded here in Nashville. Um, and I know that they were looking pretty closely at medically home. Mm-hmm. Um, for a while, but, uh, landed on, on Contessa as, as their asset. So these two merging, I mean, how many other PL players are there out there from a, um, hospital at home that, that have any real scale?

[00:59:38] Marcus: These two combined will, um. Will have over 62,000, uh, uh, stays, um, at, at homes per year. Mm-hmm. This is going to reduce the cost per patient by up to 30%. Um, that's, that's pretty significant. So this is, you know, now becoming a, a real, a real company. Yeah. That's, that's, [01:00:00] that's real scale. 

[01:00:01] Vic: Yeah. They have scale.

[01:00:02] Vic: I think the answer is there's a, there's a lot of very small, um, home, home extensions with acute care facilities where they have, they have in their catchment area, they've done something small, but Yeah. But these are the, these two merging is, is gonna be the dominant force in that space's. That's gonna be huge.

[01:00:22] Vic: Definitely. Yeah. And I think it's a growing. Market, as you said, it's already decent sized, but, but it's growing. 

[01:00:29] Marcus: It's growing for sure. Uh, Pfizer has a new playbook for reviving sales and it's starting to pay off. So this is not a vaccine conversation. Uh, this is about their drug nurtec. Um, so this is migraine, migraine med medicine.

[01:00:43] Marcus: Yep. Um, and basically, you know, they, they bought it, uh, they, they kind of fumbled the bag with it. They didn't properly, um, uh, promote, promote the drug. Mm-hmm. And, and, uh, now they are properly promoting the drug and, and it's, it's going to start generating some, [01:01:00] some real revenue for them. 

[01:01:01] Vic: Yeah. And that is nice.

[01:01:04] Vic: I guess I'm happy for them, but that's, that's not something I care about with Pfizer. Like they're getting their marketing operations going. So they don't, they're not terrible, but they need to find some new science. I mean, just marketing better is not something that, 

[01:01:20] Marcus: well, they, they really are just a marketing company.

[01:01:24] Vic: Well, yes. They used to acquire things out of biotech. Yeah. They don't. And then market. Yeah. And they haven't acquired that much recently, so it's just a No. Well, I mean they, the cupboard's getting thin. 

[01:01:37] Marcus: Well, I mean they, they obviously they went, they no vaccine. Yeah. Right, 

[01:01:41] Vic: right. 

[01:01:41] Marcus: We, we, we know what happened there.

[01:01:43] Marcus: Right. With the whole BioNTech thing. Um, so here's a story about basically Lillian Novo and what they've been able to successfully do with the FDA, uh, to get the compounders to stop. Um, all of the Glip ones and, you know, all the [01:02:00] telehealth companies are now coming out and saying exactly what we talked about.

[01:02:03] Marcus: Yeah. Which is our, our, our customers are not gonna be able to buy these products at the price differential. Um, and so, you know, they're, they're gonna try to make it, cus gonna try to find a loophole in making these. As custom medications. Um, but I, I, I think this is a losing battle for, for the HIMSS and hers and, and and other folks out there.

[01:02:26] Vic: Yeah. It doesn't, it doesn't make sense. You, you can't, you can't violate intellectual property law because you don't like the pricing. Yeah. That, I understand that it's expensive, but that has nothing to do with their right to sell it. So I, I just don't, I understand why they're doing it to keep it going.

[01:02:46] Vic: Maybe a month long, a little bit longer, but it's not real. I've, 

[01:02:49] Marcus: I've told you, I thought this was a really weird gamble in the first place. Mm-hmm. Like, you had a, you had emergency, you know, um. Clearance [01:03:00] to do this. Yeah. You, you never had a clear, long-term path to do this. Um, and this is not, this is not like the, this is not analogous to the emergency clearance that we got for telehealth, right.

[01:03:12] Marcus: This, this is different. This was, there was a shortage. 

[01:03:15] Vic: Well, telehealth isn't owned by someone that's had the IP to someone. 

[01:03:17] Marcus: That's, that's, that's the point. Yeah. Um, there's not like a loser. Right. In turning in and expanding telehealth. Right. Um, that's just, that's just more access. This is, you're, you're literally taking IP rights away.

[01:03:30] Marcus: Yeah. So, um, I I, I think this is going to continue to deteriorate the stock value of, um, HIMSS and hers. Yes. Alright. Good story. Drug overdoses are on the decline in, in America. Um, year over year, they, they dropped 25%. 

[01:03:45] Vic: Yeah. Yeah. Which is great. It's amazing. I mean, we have a lot of overdoses still, but 25% less than last year.

[01:03:53] Vic: So it's a lot of deaths that we avoided. 

[01:03:56] Marcus: It's, it's, it's amazing. I mean, it hasn't 

[01:03:58] Vic: gone down in, in [01:04:00] 12 years a long time. 

[01:04:01] Marcus: So, so, so the 12 months ending in October of 24, uh, I guess the reason why that's important to me is, is it was October of 23 when I was with my Aspen. Oh, yeah, yeah, yeah. Um, health Innovators Fellows in Philadelphia.

[01:04:17] Marcus: That was maybe like the peak of, well, I guess that's kind of the point, right? Yeah. You know, we're looking at this chart here and, uh, yeah, I, I th I think when you look at it, it looks like Q3 of, of 2023. 

[01:04:28] Vic: You were there right at the worst time. Oh my 

[01:04:30] Marcus: God. And I mean, it was so impactful to me. And, you know, we, we spent like a good amount.

[01:04:36] Marcus: Yeah. We talked about it. A good amount of that show really talking about it. And, you know, they talk about in this article that. It, it's sort of shifting geographically. So in the Eastern states, it seems to be getting better, but in the Western states it's getting worse. Yeah. And they also, they also reference, um, xylazine or, or tran that's called on the streets saying that that is actually decreasing the deaths because it's kind of, it, it, [01:05:00] it sort of, um, I don't understand that the science behind it, but it offsets the impact of the fentanyl in a way that that may be decreasing the deaths.

[01:05:07] Marcus: But as I told you, it creates these wounds, um, that just look, looks like necrophilia. It's like, yeah, it's open. Terrible. It's disgusting. Yes. So, um, you know, it's unclear exactly what's driving this decrease, but obviously 25% decrease in deaths is that's material. That's, yes. That's a lot of lives that, that are not lost.

[01:05:30] Marcus: So, um, let's hope this trend to continues. Yeah. And then we, we have more clarity on why it's continuing to drop, but obviously good news. Yes, good news. Oh, this, this, this is a fun story. Um, so the calling, uh, a medical school journey review. So this, this is a, a documentary reality show. Yeah. Um, about a group of students at New York's Albert Einstein College of Medicine.

[01:05:52] Marcus: And, uh, it's, it's kind of inspirational to see the next generation of doctors with all of the challenges that, that we face in the [01:06:00] profession. Um, the risk of burnout and all these other kind of things and the bad stories about the decline in, in new doctors, um, that are, that are being matriculated into our industry.

[01:06:10] Marcus: Uh, it's, it's great to actually have some, some personality infused into this. And, and apparently, I mean, I haven't seen the, I haven't seen this. I look forward to seeing it. Uh, these, these doc, these young doctors are really, um, or soon to be doctors, um, are really inspiring. 

[01:06:28] Vic: Yeah. I haven't seen it, but I, I want to watch it.

[01:06:30] Vic: It's on PBS and I think it's gonna be good. I. Uh, and I need some happy stories. Yes, 

[01:06:36] Marcus: yes. Especially about young people. Yeah. Tired of all the bad stories about young people. Yeah. Yeah. Good stories about young people are great. Uh, Google rolls out medical records, APIs and an AI co scientist at their annual the checkup event.

[01:06:48] Marcus: Uh, they host this Google Health host This every year. Um, it was in, it was in, uh, Manhattan. Um, and, uh, more and more APIs around fire. Um, and more and [01:07:00] more AI is kind of just where Google Health and the Google Cloud and Vertex are all going. 

[01:07:05] Vic: Yeah. And I think that's positive. I mean, more interconnectivity between health systems and physicians and even different health systems that aren't on the same platform is great.

[01:07:19] Vic: So. I'm in favor of that. 

[01:07:21] Marcus: Yep. Uh, CityMD Inks a multi-year partnership with Notable to integrate AI into its urgent care clinics. So more and more AI getting rolled out into the clinical setting. 

[01:07:30] Vic: Right. Yeah. This is a pretty big platform. They bought the, uh. Village md. Mm-hmm. Asset, uh, assets. They have a decent footprint.

[01:07:38] Vic: Yep. Decent footprint. 

[01:07:40] Marcus: Alright. Th I thought this one was pretty interesting. An EMR company called Canvas Medical that we had never heard of, but we did a little research before we jumped on the show. Um, launches Hyper Scribe, which is an open source AI copilot. So we first saw the headline. We thought maybe this was like a, um, a marketing, you know, scheme to like open source something for a, a little [01:08:00] known EMR.

[01:08:01] Marcus: Uh, but it turns out this is pretty fundamental to their company. They've been doing open source stuff here since back during the pandemic. Um, they've been open sourcing different code that they've, that they've created. And it's a differentiated model to, to sort of build a developer friendly ecosystem, um, as opposed to the, the typical closed off ecosystem that EMRs are very much known for.

[01:08:21] Marcus: Um, where you can leverage the code and, and build all sorts of add-ons and, and create more, more value for customers of Canvas Medical, which seemed to be, um, uh, physician practices. 

[01:08:32] Vic: Yeah. Yeah, that, that's right. I don't have that much to add. I think it's a good space to bring this kind of flexible, open.

[01:08:39] Vic: You can build on if you want, kind of solution to doctors. 

[01:08:42] Marcus: Yeah. Yeah. Alright. Uh, this was a big week for Nvidia. They had their big, uh, what is it called? GMI or something. He was going with the Super Bowl of a ai Well, and has some other name. Yeah. They, they've like their general meeting. They have a certain [01:09:00] name for it.

[01:09:00] Marcus: But in any event, apparently, like, it was unbelievable the, the, the waiting list to like get into this thing. Yes. There were people, did, did I send you the, the, the, the tweet from Robert Scobel? No. There was a line of people, it was like six or seven blocks long and the keynote was like gonna start in, in like 10 minutes.

[01:09:18] Marcus: I mean. 

[01:09:20] Vic: Couldn't get in. Couldn't. Yeah. And it was like security and everything. Yeah, just 

[01:09:24] Marcus: filing in. Um, and, and, and Scobel was just talking about how he had, you know, I mean this is Robert Scobel. He's been going to these meetings for like, forever, you know, since like Jobs one, right? Yeah. And, uh, and yeah, he, he said, I've never seen anything like this before.

[01:09:38] Marcus: So, um, apparently huge, huge, huge crowds for Yeah. For, you know, the Nvidia keynote and, uh, Jensen Wang, he had, for anyone who, who didn't see it, he had the little Star Wars Droid Blue come out there. Yeah. Um, and it was just, dude, it was the Star Wars droid, I gotta say. Like, and he, and he said he was, he was like, this is like legitimate.

[01:09:58] Marcus: It was like learning in real time. [01:10:00] He was talking to it. He was mm-hmm. You know, it, it was, yeah. We're getting there, man. We're getting there. There's 

[01:10:06] Vic: not, um, there hasn't been anyone since Steve Jobs with the combination of. Really good technical products, but also the showmanship, the showman, 

[01:10:17] Marcus: yeah. 

[01:10:17] Vic: The stage presence.

[01:10:19] Vic: There's a lot of great engineers that just can't do that. 

[01:10:21] Marcus: And the focus, right? I mean, the difference between Jensen and Elon Yes. Is the focus. Right? Elon is not focused. 

[01:10:31] Vic: No, he, and yeah, it'll never be focused, I don't think. 

[01:10:34] Marcus: No. Um, and Jensen is massively focused. Yes. This is, this is kind of the key difference between the two.

[01:10:39] Marcus: So, anyway, you know Jensen, he, he, he does a great job of sort of integrating NVIDIA's roadmap with. Where humanity must go. Right, right, right. Yes. And like making it kind of an imperative for Nvidia to be successful, the right for [01:11:00] future, for the future, I have to win all. Yeah. So he said, you know, AI computing needs to surge a hundred fold, you know?

[01:11:07] Marcus: Yeah. It's amazing. It's amazing. Uh, okay, so now a couple of counterpoints here. Yeah. From some opinion pieces. So this, this one story that I completely disagree with, just I think the headline's stupid, uh, wall Street Journal, why most companies shouldn't have an AI strategy. Uh, corporate leaders feel they have no choice or, or risk being left behind, but, but are they making a mistake?

[01:11:32] Marcus: This expert? Believe so, and you know, I mean, I don't know what 

[01:11:36] Vic: to, well, let, let me steal man, this story. Okay, go for it. Because I think, uh, someone has to, so I think what he's trying to say is that the, the AI infrastructure and competitive landscape is still. Chaotic. Yes. Kind of like the internet in 1995.

[01:11:55] Vic: And if you created your internet [01:12:00] strategy, then it would've been thrown out because by 2000, everything, all the tools, all the, all the vendors, all the competitive landscape had changed. And so it is not wise to spend too much time, money, resources in building a big corporate strategy at the enterprise level.

[01:12:22] Vic: I think that's the basic argument. I'm not sure that I would have made it myself and written it in the journal, but that that's what he's saying. 

[01:12:33] Marcus: Yeah. And, and, and I, I think the first principle here is that you can't afford to do it. You have more important things to do and you can't afford to thrash around.

[01:12:49] Marcus: Because it's not stable ground yet. 

[01:12:51] Vic: Mm-hmm. 

[01:12:53] Marcus: And the next story, I think is going to really articulate why I [01:13:00] think that's wrong. Why I think that's wrong. Because I, because I think you haven't priced in the other side of this. When, when, when you, when you, when that's your foundational like reason, right?

[01:13:14] Marcus: Yeah. Well, you got, you gotta run your business on a quarterly to quarter basis, blah, blah, blah, all this other kind of stuff. Right? Why in the face of the Horizon Labs thing, you know, which was a disaster? Is Zuckerberg talking about the numbers? He's talking about this is committing the r and d and data centers when it comes to ai, right?

[01:13:35] Marcus: Like, why, why is he doing that? Because you don't, you don't have a choice. The the, like this is literally an arms race. It's literally an arms race. And, and I, and I would say much like we started this show talking about how valuable the time we invest in this show has been. And by the way, you know, like we've, look dude, we've had, [01:14:00] we've had investors in, in, in our firm ask us why are we spending our time on this?

[01:14:05] Marcus: Yeah. You know, look like looking for some straight line ROI mm-hmm. Out of it. Yeah. Right. And it's like, I don't even entertain that question anymore because I couldn't, I couldn't navigate this business world today if it wasn't for us doing this show. 

[01:14:22] Vic: Yeah. It's our job to have judgment on how the healthcare ecosystem is evolving and invest in teams that are building with the wind of their back and then help them.

[01:14:34] Vic: Yes. And so we have to know this, 

[01:14:35] Marcus: I would say I can't afford to not do it. Right. And I think the same is true of, of AI strategy because if you're not, if you are not. Actively working on it and working through it. A you're not tracking its progress, which means you cannot properly project the implications for your [01:15:00] business in the con in like, in the, in the frame of Clayton Christensen's innovators dilemma.

[01:15:08] Marcus: Like, like you, you can't spot the weaknesses to your own value network mm-hmm. If you're not messing with this thing because it's changing so rapidly and at some point you don't even need to, like, you can track the trend by just messing with it over the course of a quarter. Right. Just to sort of see mm-hmm.

[01:15:27] Marcus: The difference between 4.0 and and oh three. Yeah. And just be like, holy cow, like, like all my analysts, none of my analysts are as good as O three. Right. Right. You know what I mean? 

[01:15:44] Vic: Yeah, I understand. And I agree with that perspective. And I think there's a lot of corporations that do not read Clinton, Chris Clayton Christensen's stuff, and they're, they're [01:16:00] sort of working on their existing business and just trying to get incremental innovations and, and not even that just operate, they focus on operations.

[01:16:10] Vic: And I don't agree with that and that's probably why I'm in venture. But, but I think there are companies that are not trying to be innovative. And I think what you're saying is that overall world is gonna change around them 

[01:16:23] Marcus: much. Doesn't matter what business you're in, doesn't matter what business you're in.

[01:16:26] Marcus: Right. Doesn't matter what business you're in. Um, doesn't matter what business you're in. And to that point, you know, of a quite different article. Yeah. Same week. Yeah. But from the 

[01:16:35] Vic: New York Times. Yeah. 

[01:16:36] Marcus: You know, the headline of this. Article as powerful AI is coming. We're not ready. Uh, the author of this piece, Kevin Rus, he's a technology columnist.

[01:16:45] Marcus: He's based in San Francisco. Um, and I always think it's good to sort of hear from someone in San Francisco 'cause San Francisco's a very different place. Mm-hmm. Right. Um, it's the heart of where all this stuff Yeah. At least in America is, is emanating from. And, [01:17:00] um, they, they are, they are every day talking about a GI in San Francisco.

[01:17:07] Vic: Yeah. 

[01:17:08] Marcus: Because they can see how close we're getting to it. 

[01:17:12] Vic: So let's define a GI just quickly, okay. So, um, a GI is, I think I I would define it as a system that is better at all domains of knowledge than humans. Yes. And it can learn faster than humans. Well. 

[01:17:32] Marcus: A GI stands for artificial general intelligence and general being the key.

[01:17:39] Marcus: Mm-hmm. Word in, in those three words, which is different than specific intelligence. So we have these different LLMs today and they're sort of tuned for different, um, special, different specialties I just talked about, you know, the four series versus O three Right. Versus the O series. Right. [01:18:00] O is a research series four is a, you know, prompt and, and, and fast engagement series.

[01:18:06] Marcus: Right. Um, we've, we've, we've got Google coming out with very specific AI co-pilots for, you know, decision support for clinicians. Right. You know? Yeah. These, these are all specific. None of those are a GI, but we, we are getting closer in these general frontier models to. Something that has true general intelligence, and then you pair that with all of the voice technology.

[01:18:38] Marcus: We, you know, we just talked about, we just two weeks ago or a week ago, we did, we did that, that, uh, demo. Oh, yeah, yeah, yeah. With, with the voice ai. Yeah. Like, like the real time responses. And then you ma and then you, you know, you mirror that with, with all of the, um, you know, the deep fake stuff that, that, that they're able to do now.

[01:18:56] Marcus: The video and image generation and, and voice generation, [01:19:00] um, all and then lay overlay, all of that with robotics and, and, and the advancements in, in humanoid technology. That's a com you know, a, a model that's smarter than us in everything exists in the world of, of atoms, not just the world of bits. Um, and can present in any way.

[01:19:28] Marcus: Because it can generate presentation models in any way. Um, we're not ready for that. You know, we're not ready for that at all. So to me, it's not just a GI, it's, it's the convergence of all of these technologies that are all happening at the same time. 

[01:19:49] Vic: Yes. And many of the frontier companies, there probably are eight of them, eight or 10 that we know of, [01:20:00] that we know of, um, including four or five in China.

[01:20:04] Vic: Um, they have multiple specific tools that are better than humans and they are already connecting them together and experimenting in how they work together. It is not, they don't have to come up with some unknown. Invention that no one understands what it is. It's called scaling laws. They need to keep pouring a lot of compute, a lot of server time and a lot of data, which they have both of, and they will get there.

[01:20:41] Vic: The only debate is do they get there in 2026 or they get there in 2035 and there will be, nobody 

[01:20:50] Marcus: thinks it's 2035 anymore. 

[01:20:52] Vic: Okay. So, so, but, so it's sometime between 2026 and before 2035. It's, it's, it's in this decade. In this decade, yeah. It's in this [01:21:00] decade. And then what are all the humans gonna do? 

[01:21:03] Marcus: Dude, we don't know.

[01:21:05] Marcus: I mean, like, this is why I'm like, the idea that you, like, you should not be working on a strategy is so, so for the head in the sand, it's like, what? 

[01:21:16] Vic: For a long time there was human labor. That produced things. Yep. And it was not very efficient, but that's all we had. And then with the, I don't know, the steam engine and other stuff Sure.

[01:21:33] Vic: We started having capital investment. Sure. And so then you had the, what we think of now, the traditional economy. We have labor and capital. Yeah. Those are the two steam engine 

[01:21:42] Marcus: electricity. Those are the two 

[01:21:43] Vic: major inputs. Yeah. And they've been roughly equally valuable. Yeah. The swing back and forth, 40, 60%.

[01:21:51] Vic: This, I think, is gonna dramatically swing towards capital. Right. There's gonna be eight or 10 companies in the world that have this [01:22:00] base of technology and they don't need any people or they need tens of people and we're not ready for that. I, I don't know what that even means to society, but, but we're not ready, 

[01:22:14] Marcus: we're not remotely ready for that.

[01:22:17] Marcus: Um, yeah. I mean, I, what, what I love it here is, um, you know, the subtitle of this article, right? Three Arguments for Taking Progress Towards Art, towards Artificial General Intelligence, or a GI More Seriously, whether you're an optimist or a pessimist, that's, yeah. 

[01:22:38] Vic: Yeah. I mean, whether you think it's Terminator two, we're all gonna die, or you think it's gonna be wonderful abundance either way, we're still not ready.

[01:22:45] Vic: We're not 

[01:22:46] Marcus: ready. I like, not even remotely ready. The vast majority of people I talk to on a regular basis are way more focused, certainly way more focused on the political situation. Mm-hmm. Certainly way more focused on the political situation and then the economy. [01:23:00] And then I would say, you know, it's a, it's a toss up between climate change and ai.

[01:23:06] Marcus: You know, I think a lot more people, climate change 

[01:23:08] Vic: does not matter 

[01:23:09] Marcus: and 

[01:23:10] Vic: we're all gonna be, there's gonna be AI 40 years before climate change matters. I'm just telling you. Yeah. The timing of climate change. Is way beyond the, the pace 

[01:23:22] Marcus: of, so we, we talk a lot about when the rate of change exceeds the ability for a narrative to properly convey it.

[01:23:32] Marcus: And that's what we're dealing with in ai. Yes, yes. That's what we're dealing with in ai. The rate of change is way too fast, you know, thank God I've got you. And because, because I look, I'm, I'm like doing stuff, you know what I mean? Like I'm raising the phone, you know, and so it's like, I can't, like, I don't have all that time to, you know, every time I check in I'm like, you know, when I realize how far this stuff, you're, you're playing with it more than I am.

[01:23:57] Marcus: But if it wasn't for you and like Nick Holland, [01:24:00] dude, I wouldn't, it's, I wouldn't even know how f how fast this is going, you know? So, 

[01:24:08] Vic: yeah. And no, I mean, when maybe two years ago there was a group of people saying we should, we should be cautious. We should try to. Slow it down. Yeah. That does not exist anymore.

[01:24:20] Vic: There is no, there is no, forget about that contingent of people that are trying to do that. Forget about that. It's like full gas all the time. Forget about that. We'll figure it out when we get there. 

[01:24:29] Marcus: Yeah. So at Tgu, uh, who used to work at Nvidia that I follow, I follow him. 'cause he is like an X Nvidia guy.

[01:24:36] Marcus: Yeah. He put this post out on x and i I thought it was a really good prompt. One of the top labs makes the announcement that they have achieved full a GI an ai that's better than any human at any conceivable task. What will be your first reaction? What will you do? And you know, it's just like, it's a good thought experiment.

[01:24:56] Marcus: It's like, like try, try to put yourself into that [01:25:00] situation. You wake up, you open the paper, you open your phone, you turn on the tv, and the announcement is made, you know, deep seek or open AI or x ai, whoever has achieved full a GI like. How do you react to that? There's a lot of ways to go with that prompt.

[01:25:20] Marcus: How do you react to that? Alright. Final story. Uh, you, uh, you, you, you took me, you took my advice and you started reading and superpowers. Yes. 

[01:25:29] Vic: Yes. Which is incredible. Yes. Really. I mean, I just started it last weekend, so I haven't finished it, but it, but it's really good. And even though it's six, seven years old, I mean, it's good today.

[01:25:41] Vic: It's really good. Today. It's good right now. I, I 

[01:25:42] Marcus: think, I think it's better to today. I think if I'd ran 

[01:25:44] Vic: it then I wouldn't have believed it. 

[01:25:45] Marcus: I, I think it's better today than, than it was then. Right? Right. Yeah. 

[01:25:48] Vic: And so that entire thesis that China's super competitive, aggressive markets that we don't even understand.

[01:25:56] Vic: Like, what do you mean? That you can just copy things and there's no protection? [01:26:00] Um. That has prepared them. Yes. And like, yes. Um, what did he call it? The gladiators or something like, there's been such a fight over there that now they're battle hardened and they are in a way that we're 

[01:26:11] Marcus: not, we're not 

[01:26:12] Vic: because the regulatory 

[01:26:13] Marcus: stuff protects us here.

[01:26:14] Marcus: Yes. 

[01:26:14] Vic: Right. Then I just have noticed, I think it is actually factually true too that this more China stories now, I think after the tariff thing, I think they started some PR and after deep seek maybe that like, Hey, we have technology companies here too with all these positive stories. But, um, 

[01:26:34] Marcus: and, and dude, I told you when I was in Riyadh Yeah.

[01:26:38] Marcus: You know, it's, it's some, you never see it here and so you just can't wrap your head around it. Right. But when I was in King fod Financial District, I'm like. I'm looking at big American companies having a building basically next to big Chinese companies. And that just after I saw that, I can't unsee it.

[01:26:57] Marcus: Yeah. 'cause I realized that is how the rest of the [01:27:00] world, that's how they view them. Yeah. View, views this stuff. Like, it's not like Google's up here in 10 cents down here. It's not that way at all. At all. 

[01:27:08] Vic: Yeah. And so Baidu, uh, two days ago reduce, reduced a model, a new AI model called Ernie 4.5. It's, it performs better on all the tests than open AI's most recent model, which is also 4.5, um, but it's half the cost of Deeps Seq one, which is their internal Chinese rival Deeps seq was about a 10th.

[01:27:36] Vic: The cost of OpenAI. So China is as good in performance and they're competing on price very effectively. Um, I was talking to a founder today who is saying that he is worried that, that Americans are sort of using these Chinese models and assuming the data will be safe. It's not gonna be safe. That they're, they're [01:28:00] using your data open.

[01:28:01] Vic: AI is using your, everyone's using data for training. 

[01:28:03] Marcus: Well, well, that's not the same. Uh, we, we need to, uh, you're talking about the app not, not grabbing the open source code. Putting, so that's different. 

[01:28:12] Vic: It, it's been, well, at least deep seek has been put into a lot of different formats where it can be good.

[01:28:19] Vic: Yeah, yeah, yeah. But actually going to their site, not you're to the app. Going to the app. 

[01:28:23] Marcus: Yeah. I mean, look like Americans were ready to go toe to toe over losing TikTok. So I, I just feel like that's not even a story. We need to run down because Americans don't care. Yes, that's right. Americans don't care where their data goes.

[01:28:39] Marcus: Yeah. They don't care who has it. They just want the next app. 

[01:28:42] Vic: Right, 

[01:28:43] Marcus: right. Don't give a shit. Yeah. 

[01:28:45] Vic: Yeah. So China is, they're, they're going, they're competing head to head and winning a lot of things. And so I, I'm choosing to see that as positive because our companies have to get their act together. Yeah.

[01:28:58] Vic: But they're soft. But they're, 

[01:28:59] Marcus: but [01:29:00] they're soft. I mean that, like, that's what you realize when you read the book. Yeah. They're soft. Yeah, they're soft. Um, alright man. Amazing show. Dude. That was an hour and 30 minutes. Yeah, a little long. Long. I, I ran us long in the intro, but, um, uh, great, great show. And once again, I feel ready for the next week.

[01:29:15] Marcus: Yeah. I've got my information. Yes. Uh, thanks man. So, uh, you're, you're back next week, okay? Yeah, I'm here. Yeah. Okay, great. Alright, see you then. Bye.