The $150B dollar business hiding in plain sight

when i googled this family the words came up were silent dominance middle at planetary scale i feel like i could rule the world to i know i could be what i want to put at all in in like a days off on a goal less travel ever look alright sam i have a have a bill of the week for you an m m classic this is not just any billy of the week this is one of the biggest billy in america one that i wasn't really that aware of i think you will know more than me about this but i would say most people don't wait can i guess let me reach you let me tell you three things about it then you could take a guess okay okay alright it is the largest private company in america for the last forty years mh it is owned eighty eight percent by the family and has produced more fam more billionaires in one family than any other company ever they do more revenue that goldman sachs nike and starbucks combined oh is it mars or coke you're in the right neighborhood est lau okay you left the neighborhood briefly come back to the other neighborhood of like sort of rich redneck families of america it is car oh yes so the car family so i didn't really know anything about this family can i just tell you a little bit about their story and and what they do because this it's a dominant business story of whole time wait first tell me why did this interest you why does this catch your attention remember you when i was at your house and you were like there's this closet here by the way that we found there's this extra storage room this that we didn't even know till we lived here for two months that's how i felt finding out that one of the most wealthy families in american i don't know their story that's how i felt as okay as the host of my first million i just felt like i needed to write or wrong okay i understand and and and the by the way how did i find it there was a reddit thread that was tell me about billion dollar industries that i probably don't know about and there was like the first one was sand and the second one was this and the third one is this reins insurance it's like well there's insurance companies and then they buy insurance that's called reins insurance and then the reins insurance guess what they have reins insurance companies behind them it's just insurance all the way down baby and so i was reading through this thread and then one was cargo and i was like car so what they did is so the story is back of the day as america was was sort of getting its feet and railroads had been had been started to get built farmers needed to offload their crops they're grain and they needed to sell them so they could either sell it individually so the farm could try to sell individually to a buyer and figure how to transport it there or they could work with a middleman man and so cargo became the biggest middleman on the planet for basically just initially storing grain so they would go right next to where the railroad is they would build what's called a grain elevator which is basically a giant storage facility for grain that it wouldn't spoil very quickly and the farmers could come drop it off they would get like coat check they'd get an io u that says i will pay you when your grain sells or they would just buy it at a flat rate like wholesale and be able to flip it so you could choose as the farmer which one you wanted to do this is what my father debt my father does for living by the way oh so maybe you should known he does it with onions onions but yes my my father's a a broker that's what he does does he store or he just calls one size i hey i got seventy five bush of this well fresh produce so the storage is like a day but yes okay there's a yeah there is a place where they sit for like twenty four hours before a truck that comes and gets it yeah but yes and what's the interesting robbie this me from a from a business perspective because you always hear this idea like you don't wanna be the middle man oh you can always cut out the middleman man and in this case the middle band became worth more than everybody else and actually if you look at many businesses you know there there there's many businesses where the middleman becomes a quite a valuable business and so there's an interesting question of wide in this case it's because the middleman was a physical was physically in the middle they had literally built the grain elevators that would store the shit right next to the railroad and so you needed to transport it you needed to get to the railroad who else at it like nobody else was gonna build that so anyways they start doing that they they then go you know further and further and further so you know at one point they're like hey the shipping barges are so inefficient where we're shipping the grain when it's not traveling by rail so we'll build our own shipyard our own ships they end up producing ships for the us navy they bought the biggest like meat like poultry company and now they control like a huge percentage of the meat industry of the grain industry and so they've built this like empire and nobody really knows them and the and the basically it's this is a family that's that owns this thing eighty eight percent owned by the family there's like twenty or something billionaires in the family now they have this rule called the eighty twenty rule so eighty percent of all profits will get reinvest back in the business twenty goes out as dividends to the family and they hire if for the last you know twenty years or so that they've had professional ceos running the company it's not like family run anymore and the profit per year according to wikipedia i think it's like five or six billion dollars yeah that was like during like the kinda peak covid stuff when you know when ukraine was getting attacked and and you know ukraine produces a lot of grain and so their price is spiked i think it's like three billion in a in a normal year right now okay so okay so so your close to a billion dollars a year of profit that goes just straight to the family and this been doing that for like whatever fifty plus years and so i wanna tell you a little bit of it's is something so first i was like i was like what do they actually do because now well you know when these corporations could so big so large they just have their hand and everything and you would see these comments like you know they're just everything on your plate anything you eat in a in a package cargo had a hand in it they're they're controlling the food supply the people think of like one monsanto style like evil companies and so just there's i don't wanna read you this paragraph so imagine you eat a hamburger cargo probably sold the farmer the seed and the fertilizer to grow the grain they bought the grain from the farmer and stored it at their grain elevator they shipped it on their barge that they built in their ships that they built to a processing plant where it's processed into animal feed and then they they feed that to cattle who they're then slaughter they they then store the meat at their meat packing plants sell the beef to the restaurant by the way the restaurant has to buy their salt they sell like all of the salt to all of the fast food chains in the country and then the corn syrup that they processed out of the corn gets put into the ketchup the soybean oil that's used for the fries the starch that's used in the milkshake that's all car it isn't it crazy how like one company can have a hand and so much of your day to day life and and when you're when you think you're eating at some farm to table restaurant you you're really not escaping them because they control the underlying ingredients that are used the fertilizer the seeds the grains like all of it that gets fed to the cows like it all come it all goes back to the source and it isn't that kind of incredible and the family is so big and so profitable they also own a thing called ga capital partners which is a ten billion dollar plus size hedge fund correct because they have to hedge comp commodities you know on behalf of the farmers and for themselves as well at this point so they own like a little bit of everything including minds because they need to get their own chemicals they minerals to make all of these things this is incredible no famous founder you know their office was famously this like chat looking thing on a lake in the middle of nowhere and like that was there it was called the lake office if you google it and it's just quiet you know like what how they say like money talks but wealth whispers this is this is wealth whisper shit know what i mean like who's the founder what does he look like who's the ceo what do they talk about how come they're not on cnbc do they do podcasts they don't do podcasts you know what i mean like it is it is true like quiet dominance and actually it was part of their strategy for a long time was to be quiet about it just to not attract competition and to build this monopoly position in the logistics this is cool i've known i've seen their logo and whenever i look at like the largest privately owned companies in america it's always been there i never understood what entirely did they did because it's one of those things where you say what they do and it sort sort of makes sense but it's like a b2b thing so like you don't entirely understand exactly what it does and they say like they sell chemicals and i'm like i don't know what that means you know that's so that's so vague but when you look at the numbers they do a hundred and fifty billion dollars a year in revenue that's just so massive and i bet you that they like own so many more things that you wouldn't even realize like for example like the walmart family owns like they're to raf it's like a cool bike d company they don't that they own like they just like they're just red feet they're just like deal man they just own shit they just go to the website to buy one and then they just keep pushing plus on quantity and until they own all of them like we now like the shop that seems like something that this family would do is like you don't realize it and then you if you wanted to get like cons which i have not done any research on it i'm sure that there's like ten or twenty really interesting conspiracies about how that either they're this they're pulling the strings behind you know it's like the there's something going on with this family which i'm just making up i have no idea a journalist once described the family as secretive in bread and suspicious i'm in hey i wanna tell you about something pretty cool we have a database of all of the business ideas that have been discussed on this podcast so hundreds of episodes the team at hubspot went through they pulled out all the simple relatable interesting profitable ideas that we have brainstorm and they're all available for download for free just click the link in the description below thank you to our friends at hub hubspot for sponsored this podcast and putting together this free resource for you guys back to the show in nineteen eighty they did a survey and by the then it was already a dominant company and they did a survey ninety four percent of farmers had heard of car but only half of them knew what the company actually did and then amongst politicians lawyers and journalists who they call opinion leaders fifty percent have heard of them but only ten percent understood what the business was because they have this sort of sprawling empire like you described people don't really fully understand what they even do you to sort of know that they're important i had a friend who i think it was cargo that she went and worked at because they obviously make so much profit that they were trying to invest in like new seed related agriculture related d like i think they invested like we had talked about that one d to milk company like they would look at things like that like anything like interesting and she said it was awesome working for him she said it was it was a great company well definitely there's a section called the dark side in my notes here so let me just tell you some things from the dark side just to be be fair here when you have like global crop production you're gonna have this which is like accusations of child labor like in brazil or in you know ivory coast and things like that they they're said to have better intelligence than the cia so they basically they have a spy network of around crops so like they know more about the state of crops in real time than the us government does around the world because it's like life or death for their business you know they've had like different like e coli break breakouts and stuff at that again if you're touching most of the su food supply then like anything bad that can happen and food is gonna happen to you people just generally feel like they're mono so you know they do the care about worker safety number one probably not probably not in the top three chapter to we care about but they're midwestern they they're probably really sweet but it's crazy to go from like a single grain shed to now controlling twenty five percent of the entire us export market for grains and it's like pretty crazy so they they it started a hundred and sixty years ago you and i did a talk recently and you were like we were explaining like some of our preferences you were like i like projects so like starting something and then potentially selling it but like i love the starting phase i love handing it off to someone and then i love it potentially ending and starting something new and i was saying how i love things that could potentially go for fifty to a hundred years not that i've actually done that i've actually done the same thing as you of projects starting and selling and i'm so fascinated by companies that can last this long and this one in particular is one that seems like they've kept it together pretty amazingly for a hundred and sixty years that's crazy so they started before the civil war and it's still around isn't that credible and i just if i've i i just find that so fascinating and like part of me is like well when i die like why do i care about legacy like we talk about legacy a lot and i i was reading something in the other end and like why the or someone said to like why do you care about your legacy like who who gives a shit you're dead and i was like okay yeah i i understand that perspective like we can have the d dichotomy of caring about that and then also like how cool would it be that the thing that you can create can employ a hundred and sixty thousand people a hundred and fifty years after you're gone like i know i think that's awesome i think it's kind of romantic and exciting it's kinda like two people can love running and one person trying to run the hundred meter dash and the other person's running you know one of these like ultra marathon hundred mile races and they're both like yeah i love running but and and that's what i do and that's kind of like in the business sense there's there's different ways to approach it there's the what i call the project's approach which is you kind of go in knowing like hey i'm gonna have like five great at bats in my career and i hope each one is a really fun chapter and i'm gonna seek variety in those it's totally like being an author you're like alright i got five years of research and writing and then a break and then i do it again exactly and then there's other people that are brick by brick laying a foundation for an empire and you know i i respect both but i i know which one i want to do and i think you know which one you want to do it i think you want the you want the like empire yeah i don't know if i'm gonna have the grit to pull it off but i for sure love the idea of the result do you think the people who do this is it a temperament difference like they're wired differently therefore you know flash fast twitch slow to twitch muscle type shit where it's more of inherently who you are or do you feel like you might have the base wiring to do it but you then need to adopt the systems right like for example it's not like one guy ran this for a hundred years now he passed it to his son his son kinda screws it up then the next son sort of saves it out of out of bankruptcy and then by by now professional ceos run it but they've instilled values and systems and like ownership controls but you know now the the errors are marine biologists and they're doing other things they're not running this company that the but the company the entity lasts so which one where do you think you might fail is it the wiring or the systems i think the wiring you start off a certain way but not always for example i think there's a lot of them that would have sold if they could have but the opportunity just didn't present itself and they just said screw i'll just keep going and then i think what happens a lot of times is is a few things like if you had to build a business and you never thought about selling there's a world where you would do some wacky stuff that would make the business incredibly profitable but incredibly not sell like you would acquire assets or businesses that don't entirely make sense to one particular buyer and then you get big enough to the point where you're like es this is a hodgepodge of stuff and it works for us but no one buyer would ever actually take this so like but then i also think that it comes down a lot to the family and i think that there's something special around family meetings we've had rob diet on here he talked about that i actually file some people on instagram and they talk about like family meetings explain what you mean what what's a family meeting so the way that i grew up is probably very similar to the way potentially you grew up but the way a lot americans grew up which is your parents never talk to you about money if you asked them like how much do you make they would say like the center of your business and there was very little transparency and there's there's probably very little culture creation in terms of like here's explicitly my expectations of you here's our family's culture here's our values and what i've been learning about and frankly what i like is this idea of a family meeting where you get the children and everyone in the same room monthly quarterly annually something like that and in the same way you run a board meeting you run a family meeting where you say like here's the values that we stand for here's how we did last quarter last month according to what we said we wanted to achieve and what about the future what would you guys like to do let's let's talk about this and here's the money that we have to spend on whatever dreams and ideas that you have and let's discuss if it fits within our family cr and mission and there's actually like a way to do that and i aspire you do that with my family my family is like taking minutes taking meeting minutes a board observer i just think there's something special about being explicit about stuff i think that a lot of times when you're growing up there's these things that you say well we never really talked about blank but my feeling was this right but what i would like to experience is like saying like we actually gonna speak what we intend to do and how we will do it and what resources we have to get it done and we'll have a conversation and i think there's something very special about the families who pull that off yeah i i totally agree i i think it's explicit versus implicit so it's not even like don't talk about that it's more just it didn't get said right and it doesn't get said not for malicious or secretive reasons it's just we were busy i don't know myself what you know it's like i i'm not sure i really know the answer to all these things and it's easier just not even think about it right it's like if you ask them and we'll what do you really want watch people just immediately just start to flounder her because and it's such a simple question don't you think you should know what you really want when i'm neat meeting new people and i wanna make them feel like i care about them it sounds like i'm being nefarious but mean like i'm trying to like it to know someone i'm like hey in the next six months anything interesting you wanna get done in life or career or family wise and they'll be and half the time people be like i don't know and it's like the the conversation is i'm discovering it and it's kind of exciting yeah exactly so i think i think being explicit to i'm like you i'm i'm a over communicator i'll take the negatives that come with that because i think the positives are so overwhelming but how do you do it in a family's kind of interesting i was at a a a friend's house and he has this like crest on the wall and he's like oh that's our like family crest and i was like oh like my family we didn't have one like i guess on my ancestors dropped the ball he's like no like we made this i painted that like you know five years ago and we just decided what are we all about there's four quadrant on the crest and we said it's this this this and this and this is our sigil that's our animal i love that and i was like you could just do that you could just be a university like i be hogwarts right now the hell like and i came i was like shit i'm a start doing stuff like this so i actually haven't made the chris but i have done a a few other things like i gave for each of my kids they have like a a away like i like it'd be like sam's way so for example one of my kids it's like one of them is try try and figure it out oh that's a sam way and i'll i've said that so many times that now the great father moment is when he'll just be like well i just did it i just did it the sam way and he's using it as shorthand for like i didn't give up i tried tried it until i figured it out and my daughter has a different one that's really beautiful and then we have one that's like for like i the idea of gifts so i told them was like i was yeah like everybody has like some gifts that you were given and my son loves like pokemon and things like that we kinda understands the idea that like super you have a superpower and like every every character he watches in a show has like a special power and like yeah like well you have on two he's said like really what's mine and i'm like well yours is that you're this and i just get to declare i give them a reputation to live up to you know the one that they're today quite inconsistent in but there's moments and all i do is i just highlight those moments i pretend the and inconsistencies don't exist and i just keep reinforcing that until it's their identity and i do that for each of them individually and then one of the downsides is like i make one sounds so good and i'm like can i just say that the other one has the same because then it feels less special i have to give the other one equally those but you can also do you know it's a little tricky it's not perfect but man the shit works it is really a powerful and so there's a a version of that that's completely non business related but in creating this like family dynasty idea of how do you instill a culture first in the home before you ever try to go do it you know in the office and i think the likelihood that anyone's tell them wherever ever wanna work in their business is very low and so like if that even happens i think and they get along that's like a miracle and so what i've noticed that is important also creating long term trust so i talked about this a little bit with the hears organization a her hears company which owns like g q like a famous magazine they own but they also own like a hundred businesses that you never even heard of and they including like they own half a espn or whatever whatever and one of william randall first one of his great inventions was he created this trust within the family that was pretty iron clad and it was very long term thinking trust like a actual legal trust or you mean trust like the feeling legal trust so for example for him it was like you cannot dispute this trust and if you do dispute it you're out of the will and like the trust basically just says that like hears i i don't forget the exact number but her hypothetically will have a board seats family members are always too i think it was like you cannot argue with how much money you receive money is given out equally if you want more profits you cannot argue about it if you do argue about it you're out like things like that like he like did these things that were quite good in terms of like making it last for a long time same with john rockefeller he did that he did that the same way one of the great things about reading about john rockefeller he was this mad man businessman man think of jeff bezos polite guy but like a ruthless business his son john also john he was a great dad they were both great that he was a great dad and a great son and they loved each other very much and they showed a lot of mutual respect and so what i'm noticing about a lot of this stuff it's built on a mutual respect it's built about empowering and having these very explicit conversations and that was a big takeaway from reading about them yeah it's interesting you gotta find like these blueprints it's kind of what i went back to you when i was asking about like the long term thing like you you have to get to know your wiring to know where you're gonna you're gonna naturally have things come easier to you that are difficult for others and other areas that are gonna be difficult for you and you better figure out how you're gonna work around it either by patching up those weaknesses or getting people around you who complement those and then you gotta learn the systems you know on top of it like what are the habits what the what are the actual systems on top of that to get the results i want but then there's like a wild card like for example i have a billionaire friend whose son is a homeless drug addict like they've tried numerous times so to get this kid on the right path to the point where they're like where they're we we just gotta let you figure it out and unfortunately a that that might mean death but like it they're it's a very challenging tragic situation family crest didn't help yeah like it's pretty crazy you could have i think what's the phrase you're the happiest of your saddest kid yeah you're only as happy as your saddest child yeah hey let's take a quick break you know that feeling when strategy is done the brief is written everyone's aligned and you realize someone still has to sit down and actually create all the content that someone is usually you and it's due tomorrow well the breeze assistant from hubspot can help it works right inside hubspot you can draft campaign copy blog posts emails all in your brand voice all using your actual customer data so you don't create just content you create content that converts check out hubspot dot com the agent customer platform for growing business i went on this rant about like phrases and why they're really important the phrases we tell ourselves so for example like using the phrase like i might as well where it's like well i've already eaten bad today i might as well eat it's like really that's just a convenient phrase you should not might as well do that or it is what it is is my is my my favorite it is what it is is the is the the the complete surrender of of a power of agency of anything it is what it is just replace it with just say it is what i make of this so then you say alright well what am i gonna make of this you know like it is what it is crazy can i tell you about a phrase that you're unfortunately need to know about and you're gonna see everywhere online i also want rebranded it so this thing it's called the j paradox have you heard the j paradox it's not even a paradox so paradox means like an example of paradox is like in god heated burrito so hot that even he can't eat it like this is this is more like like what is that paradox the paradox it that's a paradox this isn't even a paradox so it's just like a like a like an economic like principles okay okay here let me read let me read the actual definition an economic principle saving that as technology makes use of a resource more efficiently the total consumption of that resource actually increases rather than decreases okay so as something becomes more efficient you would think you're using less of it because you're being more efficient but in total he's way more of it because the demand explodes okay and i'll give you i'll give you a ton of examples i wanna it to java paradox because you put a little flavor yeah well because it was this guy named james j who was a british guy and i think that'd it'd be cool to have a wonderful economic principle being created by an american brother so i wanted to be one of ours not one of theirs so right around the mid eighteen hundreds james watt this new thing it's a new variation of steam mentioned which is basically the the steam mentioned that like everyone king to love and know james j was basically this guy in the eighteen hundreds he wrote a book in eighteen sixty five called the cole question and he basically says i have a feeling that because of how amazing this new steam mentioned is that britain potentially is gonna get rid of all of our cheap coal and we're gonna have a problem we're gonna have a coal shortage because everyone else was like what are you talking about the steam engine make thing significantly more efficient therefore like there's only a set amount of work needs to get done like we're just gonna use less coal and he goes no brother that ain't gonna happen we're gonna use way more coal because everyone's gonna want one of these steam engines and he was exactly right and this is where things get really freaky and this is actually what i wanna talk about it expands in a way that you cannot even comprehend and so let me give you a really simple example eli whitney he was this guy from yale and he is like i wanna make it rich i had this idea so he goes down to the south of america at the time slaves would pick cotton and they would get cotton and it would take them hours to separate the seed from the cotton to the point where they could only produce about a pound a day of cotton that was usable one person and he comes up with this little handheld device where you can kinda like put cotton in there and kinda crank it and it gets the seats out to the point where one play could produce fifty pounds of cotton they made it fifty times more efficient and so some people were kind of happy in a weird way they thought okay maybe this might mean slavery won't continue to grow and that's like we won't import more slaves that's kind of that's kind of good the exact opposite happened over the next like thirty forty fifty years cotton got so cheap that in the south of america particularly in mississippi where a lot of like slavery eventually got really bad they actually started calling it king cotton instead of king george and so america's best export was cotton and it got so strong that we had to import like eight to ten times more slaves that we than we currently had at the points at that point pre eli whitney in order to keep up with all this demand for cotton and one could argue that the reason why slaves slavery in america lasted as long as it did was because of cotton and the demand and that's one of the reasons why it was like our economic engine and so this thing this idea of this paradox it's quite strong and so the reason why it's relevant right now is because what's one product that ai is making significantly more efficient code previously code was very expensive to make so you have to raise all of this money from venture capital you have to hire all these engineers you gotta make stuff and hopefully three five ten years that code is actually working and makes a profit well paradox it comes into play here because my opinion is this a lot of people are saying that ai is gonna put people out of work i think it is the exact opposite i believe that code will get more cheap therefore demand will increase a significant amount to the point that we can't even understand for example gut invented the printing trust when he invented the printing press people were thinking you know maybe people will read like two times three times five times more books than the reading now and gut this guy creates this printing press i believe in the fourteen hundreds and the offspring of that like on the extreme end is this idea of the kindle one could even argue that like reading text on a page like on a computer screen is like of a way further downs but like it didn't make five times more books it made like it's infinite like it doesn't create like ten times more it's like it creates a whole new thing what i have noticed i've have noticed this with the cotton gin i've noticed this with the creation of the steam engine which ben on went to create the railroads which created a massive boom in america when when technology makes a a product that already has some demand more efficient there is turmoil amongst those who are directly impacted for example have you ever heard of the lu yeah people who don't adopt technology yeah so now it's used as an insult back then it wasn't so the history of the blood is basically right around when in the industrial revolution there was a machine invented that allowed people to weave cotton sorry wool into yarn much faster previously there was like five or eight hundred thousand people in england who did this by hand and they're were considered craftsman this new machine comes in they get put out of business to the point they create a fake character called ned lu and in england this group of people go around smashing these new machines and it starts ruining the process of creating this new like wall to the point on behalf of ned right like yeah this this the a person that you couldn't attack because he wasn't real it was a fake person and it was so serious that it was a capital punishment in england so if you got caught breaking one of these machines they would put you to death and so this idea of like there was like five or eight hundred thousand people who are willing to risk their lives in order to ruin new technology that's like the history of blood i but my point being is when there is a new creation there is a subset of people that are screwed for example when switch boards went away in america there were in the nineteen seventies there was like eight hundred thousand telephone operators mostly women that those they they they didn't exist those shops didn't exist but in general more technology that creates a more efficient process creates new jobs sometimes because of increased demand sometimes the other thing is that because there's new industries created that we can't even comprehend and so my opinion ai is actually gonna create a net positive not a net negative which i previously thought i first of all excellent monologue highly informed highly entertained i i enjoyed that this you told me you were reading about the industrial revolution because you were trying to figure out like history doesn't repeat but it rhymes what happened in the past what did we say what did we think then does that sound like what we say and think now and what actually happened yeah like one that came out like ten or fifteen years ago that's now popular again that i read a while ago is called the american and it goes through breakthroughs in american capitalism so like different inventions and you'll notice that people have the same fears consistently so let me ask a different question one of the most dangerous things in business is to think well this time it's different those are very dangerous words this time it's different however it's also dangerous to say it'll be just like last time you have to almost consider both possibilities i'm not saying that by the way what i'm saying is that human nature is human nature and there's something special about the thirty to sixty hour a week work week that has happened for centuries and also time and time of again there's this idea that i always come back to you i used to be a bee keeper and b's are really interesting with b's if you get one hive with one set of b's you just stack that over and over and over again b's fill up space they just fill space in the same way whenever you've gotten a new home anyone has experienced this they get to this new home they previously selling on a thousand square foot they get to a two thousand square foot they save themselves i'm never gonna fill this place yeah and then magically over the next three years they go have so much junk that is a like the human need to expand to grow to fill space is innate it does not go away and so that is what i'm saying is the same every single time not the how i don't know how this is gonna happen that's sort of the point of my monologue is that i don't know but i know it will happen yeah and and not to be too abstract here but the one thing i don't get are the one thing i haven't figured out with with that i i i buy everything you said also the new demand will get created will want we'll want code in places we didn't have code so yeah it'll be more efficient to get code but net you're gonna have way more code way more people creating code in this case if ai is so good at doing the ai is a technology that basically is the technology of doing work like generic work human work it's like basically a model of the brain like who's to say that ai won't also fill those jobs may meaning like yes it creates all this demand which creates new job opportunities new industries but who's to say the ai also isn't the one who supplies that demand also because you know the printing press these were more rigid technologies that could do one thing ai is weird and that it's just like flexible general thing that can do so many things so who's to say it doesn't also become the supply there's a few ways to look at this the first is like you could say well is this gonna be like hot water so for example when hot water was invented this idea that you could like take showers every day like a king like that was incredible and so hot water surged and water heaters were putting every home in america but you know what happened we sort of figured out how much hot water we need like we don't actually need that much hot water today than we did like fifty years ago so it took off and then it kinda got flat right but another example is electricity when electricity was like invented it basically became like a base unit of measurement for life where if physics to if physics if it can exist in physics there's a way that you can uniquely use electricity to make it happen i think potentially code is going to be like that where it's going to be a unit a measurement where you can find infinite ways to get done what you won't need to get done and i do not think that it's going to be like water where it's gonna be like alright we figured out we don't really need that much more hot water well why are you seeing code instead of like intelligence i'm just kinda working through this to be honest like i'm i'm still like but i was trying to think of like that's like a unit intelligence is i don't understand how to like quantify it but now this is actually interesting to you potentially there is always a point of turmoil with these new technologies and i've been trying to actually break down is there like a formula that you can figure out will the economy boom or i i think it will i think that's inevitable but like how long will it take so for example the railroads came about and that's and like it there's like this weird chart that if you look at like how many railroad tracks were laid and how the average person's protein consumption went up because like what the railroads did was they made america smaller and it created like towns that didn't exactly have to be where they were anymore and it created this massive like booming economy however it took fifty years because we had to create railroads which is a very labor intensive thing we had to create steel which was like entirely new invented and so there's this equation where it's like the breath of the technology meaning how many people does it impact multiplied by this like the intensity of how it impacts you multiplied by like the time of c invention and that equals like the length of turmoil that someone will go through with chat gb growing as fast as it has there is a world where the tumultuous period is relatively short compared to past breakthrough technologies and if you knew the turmoil either when how or how long what would you do with it because you said there's like an opportunity what's the opportunity like if you knew that like the the like it's only gonna take us three to five years to like figure this thing out to where we're humming again that you can make bets on that yeah actually you know one of the kind of j paradox plays over the last few years has been in video because what a lot of people thought is hey people are buying these gpus but each training run each algorithm improvement that the labs are making is gonna make you need less and less of these gpus in order to train these models and jensen went on on tv saying was he was like you're right the training is gonna become more efficient but the inference is gonna go up by one million percent or like whatever one one million x and people were like one million x and he's like one million x and it's kind of what you were saying at the beginning which is that when these things do diffuse the demand goes up not by like some kind of easy to understand percentage or multiple but like in a mind boggling way where you know when from the time of the printing press to now like if you were trying to market size how many people will create text and how much people read text you couldn't have thought of twitter right twitter would've have broken your brain it didn't make any sense but that's kind of what happens and so he's been saying that about inference which is like when you when you query ai when you use ai to do something you use inference and he's like inference is is going he's basically people don't understand like how how much there how big the inference need is gonna be for the world just so like you know mind boggling i think what's gonna happen over the next six months is and this is partially for listener because i think you potentially might know this is i think the popular smart people which i think we're relatively popular i don't think i'm that smart but i think the popular smart people the narrative is going to change it's not and this is and self serving to have this narrative particularly if you're a president or whatever but the narrative is going to change but this is going to be a massive net positive and they're going to cite j paradox and they're going excite everything that i've just said which isn't particularly unique and nothing i'm saying is unique dude see this all the time it's like yeah this is gonna be great for you if you make it great for you i think people are just sitting back as like the recipient of this and it's like is this hand gonna slap me or is it gonna put you know grapes in my mouth and it's like well it depends like it depends what you do are you learning how to use this shit are you paying attention to what's going on are you thinking about how you can use this in your field are you talking to smart people are you moving where the puck is going or not like i feel like people are so passive about like what's gonna happen as if everything is happening to you and then none of this is happening potentially for you and that you have no agency to be generative and to democrat this technology for yourself thanks podcast is brought to you by my friends at mercury they make the world's best banking product i think you know this already i used mercury for all my businesses i think i have like maybe seven or eight businesses we use mercury as our business banking across all of them and now they actually just launched a personal banking account so i have my personal account there i moved off of wells fargo in chase i'm just all in on mercury why i like products that are easy to use i like products that get me and the problems that i have so like it very easy to make joint account with my wife very easy to spin up virtual cards one click and i get savings yield it just has all the stuff that i need in one place so if you're looking for the best banking product on the market it's definitely mercury i will fist fight anybody who disagrees with me on that go to mercury dot com slash personal and learn more mercury is a fintech not an fdic insured bank banking services are provided through choice financial group and call them an a members fdic the reason i was studying the lu is i think that same movement is already happening right now and it's gonna continue to happen you know you saw like at this recent college graduation speeches like steve's or solomon i it's his first name solomon the ceo of goldman was like talking about ai and everyone was billing yeah people walked out right the reason i'm bringing this up is if you go back and study the gil age which i that's one of my favorite arrows as well as the industrial revolution it's all just repeats itself everything's repeating itself it's it's like the it's very very very similar over and over and over and over again this is all quite predictable now the time and the how is who knows but like the general trend it's all been there done that yeah yeah that's crazy to me that it's become like a high status thing to do to be anti data centers and ai and things like that it's like really really that's i don't think that's fair i i i don't think we should dismiss it i think they're stupid i understand their sentiment can you imagine being a or twenty one years old first of all if you're twenty one years old you fucking graduated high school during covid that sucks okay the world changed dramatically over the last four years the point where you you were expecting to get a job at deloitte and or as a law clerk or whatever like you know and they're like nah we don't need you dog like there is anger which i understand but i think that the way that they ask me to put on my mind in the mind of a loser and i just can't do it it's just not possible to do this the loser think is just not acceptable in my mind and i i'm sorry i just i just don't have the ability maybe you can maybe you could have go in the mind of a loser but i i think they're are wrong but i have empathy for it i i understand that feeling and i think they're stupid dude there was one point where like atms had just gotten invented and these people who are like the bank telling it was like there it was like a big deal that was like a big job and they they revolt they're were like f this you're gonna put us out of business this of that and do you know what happened way more banks went up may way more banks were created or branches like physical locations way more and so i just think if i'm telling these young people i would say it might suck for a minute dude if it's if you're young you have no excuse okay i can get it if you're like sixty five and you're seventy five years just old or whatever you're like oh my god there's a lot of change it's gonna be really hard i've been running my business it's it's pretty difficult for me to reinvent right now like i have a lot more understanding if you're eighteen i you didn't know anything anyways you know hop on this train this train is exciting this train has like so much room to run you know you you just sort of have to look at the counter right so you might say well it's gonna be harder than ever to get a job or this or that it's also true that more people than ever are gonna create new things more people than ever are gonna become successful more people than ever are gonna become millionaires out of this and so it's entirely possible to to have that result if you if you choose if you do the actions that will that will get you to that result so i guess i just have very little empathy for like the younger folks so this should be easier come more naturally for them they have less invested and less sunk costs less rigidity of the past to even like be tied down to so and i really understand that at the other side is like is this serving you like is that attitude serving you in any way is like forget arguing who's right and who's wrong like at some point you just have to ask does this belief serve me or not and i don't believe that that belief serves you i also don't believe that you can control it just like ned lu and the lu found out it didn't matter how many windows you smashed this shit's happening it's like getting mad at the weather it's like it's gonna rain whether you shake your fist of the sky or not like you have zero chance of slowing down ai the ai freight train has left the station it is happening and so all you should really worry about is what you can control which is your reaction and response to the new playing field trying to argue that the new playing field is bad is sort of stupid to me it's like again like yelling at the weather you don't get to you don't get just have a say and that side of things the new york who the governor the mayor whoever was that was like proudly like we have banned data centers in new york state they were like so happy about it you know policy is already very performative but like man taking so much sm pride in like ban vanishing the technology that's gonna create all the where all the growth is coming from in the economy is sort of a you know silly and one that's being popularized now is data centers use electricity and use water and i actually have no idea if that's true or not true but whatever i see these things i'm like we should actually learn it if that's the reality because i i have a feeling that like the super bowl is significantly more inefficient than a data center and yet we celebrate that like anybody who has this feeling and you're like man sean really not emphasizing with my excuse being a jerk about this he doesn't understand how hard it is right now and for for me just watch this clip just need to watch this clip of this guy with no legs completing the last men standing race which is like this insane twenty six hour fitness event and he's crawling he's using his is pulling his wheelchair through the mud using his arms finishing this race and anybody who's got an it is what it is attitude go watch this on loop this should be your commencement speech instead of you know just sitting there sm and walking out of it because some guy said two letters you didn't like i usually think of sake and lewis and clark that's mine in moments like this yeah i think look they walked across an unknown territory for two years with a three month old baby they could do that and that baby's to live i can do this that's what i need actually that should be a service when you're in disneyland as a dad and it's like hour seven and it's it's so hot the kids are crying cranky after you spent a thousand dollars taking them to the happiest place on earth and you're pushing the stroller and you've got the turkey leg dripping down your your your your arm you the juice of that thing and you just hate your life you need you need the package we example yeah you need they're like look it's the story of moby dick is real these guys floated across america on a raft for ninety days before they were discovered okay if they could do that we can get to mcdonald's without crying k can i tell you very inspiring entrepreneurial story just to leave on a high note have you ever heard about the ice king frederick tutor you know this guy not personally alright so fred tudor so the sky is known as the ice this sky basically he lives in the north north northeast of of the us so he lives near like boston or something where it gets cold and you know boston gets cold in the winter there's tons of ice and he realizes he learns that in south america they never have snow and they never had ice and so he is this brilliant entrepreneur entrepreneurial idea he's like i'm a sell ice to the south americans and this is pre refrigeration pre the freezer being invented right because so he's basically goes out wherever there's like a frozen lake and he would get blocks of ice and he would figure out how to transport it on boats to south america and go try to sell this stuff and he was like i will sell i'm not selling ice i'm selling winter and people were like how are you gonna even trans melting he's like so he starts getting in the lab and he he uses wool to wrap the he realize realizes he's like oh i can cover it with sawdust and sawdust will preserve this ice for like a little longer and he would start the thing with like two hundred pounds of ice in by the end he would have like you know seventy pounds left but he would still sell that seventy pounds and then when he got there people didn't understand what to do with the ice would sell the ice and then people come back complaining being like it melted dude he's like what are you talking about that's what it does it's it's ice it's hot outside they didn't get it and he's like okay i just got on this boat for like a month and brought them ice and they didn't want it i have to get them to want and i have to build the desire in their mind and so he goes and he figures out what's the key product what's my hero hero product here he's like i need to sell cold drinks on a hot day so he goes to the bartender and he says look i'm gonna chip you off a little ice here this is free for you but you need to start serving rum cold in a chilled chilled drink and so they he gets the bartender tenders free ice they start giving people ice out of the cold drinks and guess what once you've had cold cold rum you never wanna go back to that warm piss again and so the demand starts to get built people start to want ice and this guy builds this amazing trade he pioneers new methods of refrigeration and freezing in order to transport the ice and ultimately puts himself out of business because people realized oh wait we can just freeze water and make ice ourselves and then ice straight kinda collapsed but frederick tudor for a day was the man i'm always i'm also always interested how you got interested in this because sometimes those stories are equally as good so me and diego who's right over here five feet away from me one of the things we do is we we try to read as many books as we can and so he's been reading this book called the medici d effect so this was one of his stories and i was like wow that's an incredible story i'm happy at reading books now that's standing but i like it i i appreciate it i did not say that i mean i said what i just said but you previously said that you normally don't make it past the table of contents i don't i know said that book i buy the book with great enthusiasm that i really don't even open them they i've i've actually you'll appreciate this i'm creating a books shelf so you'll see my office is gonna change soon i'm creating a books shelf that is like a trello board so it's basically a progress bar books shelf so i have all the books i bought that's my ice box my pipeline and then a book moves into like the reading phase and then it moves physically into the completed phase and then there's the hall of fame of like great books which will be like the few the rare the ones i actually recommend to anybody else it's sort of like one time steps smith's told me she invented a water bottle that reminds you to drink more water and i was like just chug the water i just i just sit down and read the book like sure might she not being a progress bar has not been the thing holding me back that's what i'm been telling myself so my old boss emmett from from twitch he would tell me this because i have a tendency seat to do this where i will over architect a solution to something and i will convince myself that like this elaborate way will be the solution instead of the the obvious and so he would just listen to me talk and i would tell him fifteen minutes what i'm this great idea i have and then i'd be like it's great right and then he would say simply he'd go have you tried solving the problem the he's like he have you tried actually just solving the problem and then he would say things like the only way out is through sean and i was like oh wow i was like yeah i'm kind of a idiot it he goes no actually he goes i'm a partner at yc and this is the most common advice i give to yc startups they'll say exactly what they're planning to do and then i'll ask them have you tried solving the problem then don't be like what and is like shock value way of reminding you that like in many situations the only way out is through and you're trying to find a way around there is no around there's only through i waste so much time like charging my airpods looking for the whole store to hold my iphone making sure that like i this i'm like dude just you're just calling for like a thirty minute run i will bought i will do door i did this sit today i was going for a run i door dash you know the little arm plastic like bloody monitor where you put your phone and i was like well i certainly couldn't run without my phone so i guess i'll just wait forty five minutes took this thing to arrive here or i go keep my run four hour of four minute run i was gonna run half a mile do the same shit off one song i can just upped it what was it like come a lady come come i'm a lady you're my butter butterfly shots so running and like is this guy's singing who steak to himself what if people listen to us why do they listen to us clearly that's pod i feel like i could rude where i know i could be what i want to from at all in it like a days off on a less travel never look kim bag alright let's take a quick break just talk about a podcast because if you're listening to this you like podcast and what's better than one podcast another podcast and let me tell you another podcast you should check out it's called success story if you like hearing about different success stories and hearing q and a sessions with successful business leaders or or hearing keynote presentations or just checking out conversations about sales and business and marketing tactics this is a great podcast for you so check it out wherever you get your podcast or