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[on-hold music] So how do you see this, like, hire for longer era changing? Well, the optimist in me s- thinks that it's going to help us focus on things that we can see brings true utility.

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But if I'm a little bit more pessimist, my worry is that we're going to see just, like, a contraction of new things. I think if AI wasn't happening at the same time, we might have a clearer vision of what's gonna come.

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But I think AI is a- Yeah... disruptor that we can't predict. I think you're truly right.

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[on-hold music] This episode of the Rebooting show is brought to you by XCO.

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XCO's new guide for publishers, called Choosing the Right Online Video Platform, demystifies the selection process and empowers you with the knowledge and insights you need to make an informed decision.

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To get the guide, visit x.co or visit the link in the show notes. Now on to the episode. [on-hold music] This is a crossover episode with my fellow People vs. Algorithms podcaster, Alex Schleifer.

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Troy was not able to join us this week. But I wanted to talk with Alex because I'm doing a talk later today at the Self-Serve Summit, powered by Danads, about what comes after the zero-interest rate policy era.

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I mean, there's a meme of sorts for the last several months of calling things zero-interest rate phenomenons, and it's shorthand for saying something is doomed and likely never should have been because that thing could only exist at a time when borrowing money was essentially free.

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And it's an interesting framework for me because, as I've said a bunch, I feel like we're between eras in media. And if COVID was an accelerant of ZIRP, so too will AI be the companion to the hire for longer era.

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And I think when you add those things together, you get what I call the more with less phase of publishing.

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And the challenge for all companies will be how to harness the power of AI to do more with less, and then to also protect themselves from extinction by... Well, we get to that later in the episode.

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Sorry, you gotta listen the whole way. But a quick hint, it involves being distinctive and doing things that technology platforms cannot do. Now on to our conversation.

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[on-hold music] Since we decided to do it, I've had very little time to prepare. So- That's fine.

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The idea that I have behind this, 'cause I have to give a talk on this, and I have a very strange way of preparing for talks like I do with podcasts.

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And so I have the slides done and everything like this, but I wait until right before. I know what I'm gonna say, but I don't write it down. Do you write it down?

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And then before, I write, like, five points I wanna hit at on each section.

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I think writing it down for me, even if it's on paper, helps me because, you know, English as a second language, and I'm a pretty disorganized thinker, so writing things down helps me not meander as much.

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It's funny 'cause I'm a writer, but I don't like... I don't write out what I'm gonna say because I find it just a waste. Yeah, you wanna get paid for every word. Well, I mean, w- writing is different than...

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My first job was as a speechwriter, and, like, it's totally different writing than- Oh, wow... 'cause you have to write the way people speak.

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And so when you read speeches, the best written ones are not anywhere close to what you would read an essay or something.

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That's why I think it's strange when people read their newsletters because you speak differently than you write. Yes, it's uncanny when people do that. Yeah. That's my one beef with the Sam Harris thing. It's so...

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He writes it and reads it and, at least to me, it sounds very much like he r- is writing it and reading it. Oh, that's interesting.

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I find when Scott Galloway does it, I notice a big difference with that, but it's maybe because I don't know Sam Harris talking normally. And- I, I don't know either. [chuckles] I, I think he sounds pretty much the same.

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Like, his tone is pretty- Oh, really? Yeah. Maybe I... He... 'Cause he occasionally does a podcast where it's just basically him talking his essay. Yes. And that's just... He's just...

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He's reading a newsletter, obviously. That's what he's- He is, but he sounds the same when he interviews people. He's just a- He's just very thoughtful. [chuckles] That's either thoughtful or you're reading a script.

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But- Just psychotic. Maybe. Yeah. Yeah. So I also wanna use this. I wanna see if I can use this as a crossover episode 'cause I need to [chuckles] I n- I need to have an episode for tomorrow for my other podcast.

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Is this the, the Brian Morrissey extended universe? Is this our end game? I'm doing four newsletters this week, four podcasts. I'm doing two private dinners. I like calling them private dinners.

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I think that sounds like, "Ooh, I wonder what's going on there." [chuckles] I took it from Puck. John, if you're listening, I stole that. Private dinners? I mean, they are- They sound like just-... private dinners.

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Like, what would a public dinner be? Anyone who shows up? A, a food-based webinar. A public dinner is a food court, actually. Okay. Oh, and then I'm doing...

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I'm speaking at the Self-Serve Summit, powered by Danads, where Troy said they're gonna have a buffet. I'm speaking about a post-ZIRP media era. All right. So we're gonna talk about the ZIRP era.

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I know you're covered in cold, but it's good. Yeah. So I'll, I'll try to be as insightful as possible. So basically, this is, like, a free consulting session I'm giving you here. It's not, it's not consulting.

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It's brainstorming. Oh, that's fine. [chuckles] I get a lot of these requests from these consulting companies that l- connect me to a, some sort of corporation and charge them- Oh, I'm doing one of those.

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I'm doing one of those next week... two thousand dollars. I never do it. And if the guy's listening here, I'm gonna confess to him 'cause I got the call from whatever the something or other.

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I won't say the name of the company. But you know- Yeah... you get these calls. Um, ninety percent of the calls I get, I, I, first of all, I don't answer, but I just assume it's a spam call.

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And when there's a pause on the other line and then it's like, "Is this Brian Mor- Morrissey?" I'm like, click. Which I don't mean to be ru... You probably wouldn't do that, but, like, I would.

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And, and then I get a text message right afterwards, and the guy was like, "Oh, this is so-and-so from," whatever the company's name is. "We got disconnected earlier." I'm like, "That's one way to put it, yes."

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It's a euphemism.I hung up on you. I do think up when people call on the phone, I think that's just rude. Well, he had the text. He could've texted me. Yeah, exactly. There's an order.

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I mean, I think a text is already an invasion, but- Oh, really? I... Like LinkedIn. Just LinkedIn. Let, let me ignore you on LinkedIn- I sent a cold InMail-... that's there for... today.

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I felt like very, very much like a recruiter. I'd never send a cold InMail. How did that feel? It felt weird. It was s- it felt right at the time, and so I just, I decided not to overthink it. I just went with it.

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I'll let everyone know next week if I got a response to my first, possibly first ever, like, cold LinkedIn outreach. Well, I'm sad to hear that. We were sec- we were second- Right... we're second connections.

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Whatever, second degree. What is that? Anyway, I wanna talk about the, the ZIRP era- [laughs]...

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'cause, you know, we've, we've flicked at it a few times, and I know that the, it's a broad thing because it, it covers basically 13 years in the global economy and macroeconomics.

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But I think it does tell an interesting story of the post-financial crisis up until now, and I think both the industries that you're most familiar with and that I am are intertwined, and they overlap, but they're kinda different, but they're both gonna be severely impacted by the fact that the cost of capital is no longer zero.

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Like, I think that you can define a lot of what happened in the last era as just coming back to that simple fact that that was the reason we had all those subsidized Uber rides and, and stuff.

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I can remember going to the airport for, like, 15 bucks. It was great, but it's not coming back.

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And I think media, in many ways, and we'll get to media second, benefited from this but didn't really understand that they were benefiting from it because there were so many other challenges going on with how the media economy was being swallowed by technology, basically, at the end of the day.

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You can argue about whose quote, unquote, "fault" it is, but the reality is that's what happened. Just to frame the conversation, ZIRP, the zero interest rate policy, right? Yeah. That era starts around in 2008- Wow...

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we're at a quarter of a percent. 2009, 2010. 2009.

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I mean, I'm not an economist, but from what I remember back then, it was pretty obvious that Congress was not going to act, and they weren't gonna fiscally stimulate the economy, and so all you have is monetary policy.

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And so the US economy did not recover. Europe was a disaster, too, after the financial crisis because of just simply bad policy decisions.

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Like, I think what happened to Greece is like- No, you're an economist, but you have, you have some opinions. I mean, I do because, like, it was very...

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Uh, it's kind of a basic sort of thing, what you do after this- Mm-hmm... and, and there was a bunch of people who, for different political reasons, the House was on fire.

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They're like, "Well, we gotta conserve water," and I don't know. I mean, have we... how are we gonna- Yeah... how are we gonna water the garden later? And it's like, but the, the house is on fire.

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I feel like maybe we should just think about that later.

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Anyway, so a lot of policymakers, I mean, Japan had tried this in the '90s, mixed results to bad results, just dropped the cost of borrowing to zero to stimulate economic activity, and it worked. Works. Yeah.

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There's a lot of stuff with the economy- Works... works, and that is why so much money flooded into a lot of money-losing startups. That's why Vice had its, like, [laughs] 19,000 subsidiaries in the Bahamas and whatnot.

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To me, I think there's a time, that first phase of ZIRP, which is, like, maybe until 2018, and they were kind of raising rates a little bit slowly.

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There seemed to be maybe an effort to get out of that zero interest rate era around then. But then COVID hit- Yeah...

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and then we got that second boost, and it went straight to zero, and I think most of the excesses in this concentrated form of what we call ZIRP kind of is that era. Like, that's...

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We say ZIRP, but it's hard to remember the f- I mean, the Ubers and the Airbnbs of the world, right, you could talk about those, but that, like, slice between 2019, 2020- Yeah... and 2022, that's how we remember- Yeah...

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that era now, nowadays, right? Yeah. I think it's also... COVID was a great accelerant. Remember early it was l- it, the idea was the pandemic has accelerated the adoption of e-commerce by 10 years.

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Remember all those things that- Yeah... very smart people said very confidently with very high valuations? Yeah. I can remember the Shopify guy saying that.

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I, I h- I, I bought Sh- Shopify stock after that, and, and now it's worth, like, a fifth of, of what it was then.

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Well, well, to, to his credit, Tobi came back and said that he had been wrong, while Andreessen's still out there saying how right he's been about everything after killing Web- Oh, he's just skipped, uh, he's skipped the crypto stuff.

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[laughs] We'll get, we'll get into his essay. Maybe we can get into his essay. We'll get to [laughs] okay. All right. Since Troy isn't here to cheer for power. Yeah, that's gonna be a very one-sided look at Andreessen.

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Well, I would actually... I told Troy that we were gonna do this. What do you, what do you think his react...

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He would be bored right now, and then he would be like, "Cost of capital drops to zero, lot of stuff, good ha- happens, some bad happens, and then people just go on."

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[laughs] Ah, that was a pretty good im- impression of it. Yeah, I mean, I think he always has some interesting takes, and I'm not sure exactly what he's, he thinks about Andreessen.

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I think even if he disagrees, he might play the contrarian here. Well, I think th- one of the things... I, so I guess there's a couple things.

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One is, like, obviously, I think the flood of VC money into money-losing companies that didn't necessarily have a path seemingly to profitability. There were a lot of companies that existed. I think about the DTC sector.

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Right. Many of those businesses... At my last job, we had a publication that almost, like, exclusively catered to these little, like, sock Instagram, like, sellers. Bombas and Allbirds- Oh...

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and Casper and Peloton and all- So those were the ones who got the, yeah, that got the almost escape velocity, right? But, like- Yeah... an area l- such as bikinis, okay?

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I remember at one of our events talking to a, a woman who was running this DTC bikini company, and she's like, "Our research has found, like, there's nine of these [laughs] funded."

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I was like, "What?"I would have to edit all of these stories about these DTC founders, and they all had a like... I think they might have had the same PR firm 'cause they were s- they were so full of shit.

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They would say that everyone discovered this problem that they needed to personally solve 'cause it was part of their personal journey or whatever, and they always had their epiphany between their first and second year at Harvard Business School.

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[laughs] Why can't they just be like, "Look, I went to HBS, I knew I wanted to raise a round, and so I just looked around for a category that I thought I could do it in."

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Yeah, the one with the biggest gap that I could scope. Yeah, exactly. They were always like, "Well, I found the TAM was actually good," and I was like, "You know, nobody says that." Yeah.

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And it just happens to be some sort of personal- Why shaving? Well, it reminds me of my dad. Yeah, [laughs] exactly. Like, let's stick to DTC for a second here. Yeah.

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The Chris Kimball conversation highlighted something la- last week, you should listen if you haven't listened to it yet, but we had a great conversation, and he mentioned that there was an era where just advertising was easy, and I wonder how much of that DTC explosion was always when you could say any agency...

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And I saw this happen with a, with a friend of mine that started a DTC business where the agency would have a model where they would charge a, a minimal fee and then take commission, right, on the sales.

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And it was super easy because they knew that they could just spend a dollar and make $1.50 [laughs] on it. Yeah. And he just threw money at Facebook. It was a money machine.

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But together with- It was a, it was a customer machine, and this is- Yeah, exactly... that's what it was, and it's like you fed a dollar in, you got a customer who would buy $1.50 worth of stuff, and- Mm-hmm...

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I mean, I covered it when it was marketing. It was easy to find that dollar, right? You went to, to the market and you could find that dollar. But it is also no longer as easy to advertise, and I wonder- Yeah...

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if that's not a ZIRP issue, right? That, that- Well, there's a few things, right? I think that the era, the Wild West, in quotes, era of using data however you want is a ZIRP phenomenon.

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At the end of the day, it was never gonna last. It was a market distortion, and it was taken advantage of by a lot of people, but it was untenable long term for a sustainable ecosystem.

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Troy and others can argue, and I'm very sympathetic to things like GDPR are kind of ridiculous, and I do not believe that Apple wants to...

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is driven by [laughs] out of the goodness of its heart, that it wants to protect privacy as a human right. I think it just so happens to greatly benefit Apple. Go figure. Strange.

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But at the same time, I think that being able to basically acquire customers for very low costs and very regularly and consistently is just simply...

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It had never existed before in media and marketing, and the way that it did exist, it was not tenable.

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I don't think it was, a- and it's obviously not tenable 'cause it's gone now, and the cost of acquiring a customer has normalized. ZIRP to me is just a distortion.

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Why wasn't a company that benefited so much from this DTC ZIRP explosion, like Google, why is it that their revenue hasn't been impacted?

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There's some research out there, and, and Bloomberg's written around it, that says, like, ZIRP really benefited the top 5% of companies. They did great.

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You would think that a, a company that is s- so reliant on these small startups spending money on AdWords- Yeah... would suffer, and they haven't. I mean, I can remember...

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This, this is a little bit of a digression, but, uh, hopefully not too much. Covering Google for...

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I, I, I've talked about it, I've covered it, like, since its, like, early days, and I hated interviewing people from Google 'cause they were just PR robots for the most part.

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But the few times I interviewed Hal Varian, their chief economist, w- were, like, amazing.

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I loved talking with that guy 'cause they had so much data, and even back then, and they were more open a- about it, is that they knew when there was gonna be a bad flu season before anyone else.

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And, you know, this is when we were thinking about all the possibilities, all the positive possibilities of technology.

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I think this is what Marc Andreessen is maybe pining for because it wasn't obvious that all of this... I was like, "Oh my God, this data, we can do anything. It's...

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We can collect all of this data, and then Google is gonna allow us..." Nobody was reacting against any of this stuff.

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I think in a many ways the fact that Google did, has not suffered as much, and this might really kill the, the, the plans for Google to sponsor this podcast, it's just a testament to the fact that, of their monopoly power in this market.

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You know, they'll quibble with the word monopoly, but the reality is Google never had to give guidance because it didn't have to give guidance, because it could always hit whatever number it wanted.

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And it's coming out in this case, you know, they're closing down a lot of the things coming out of this case, of the internal pressures, and it involves a lot of trade-offs.

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The reality is, if a quarter was coming up short or whatev... They could put it wherever they want. I mean, they own the parking lot, and it was an infinite parking lot. It...

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So- Well, there's this big court case happening right now, and there's one of their- Yeah, the DOJ case.

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The DOJ case, and one of their executives was caught saying, "Search advertising is one of the world's greatest business models ever created. It rivals illicit businesses like cigarettes or drugs."

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And so [laughs] they're trying to play this off. But they knew. I think it might be better. Yeah. It might be better. I mean, cigarette- Better... and drugs, you kill off a lot of your customers.

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[laughs] You're shorter... Like the LTV, your problem is that the L i- is short. You're shortening the L. Like- Yes, exactly. [laughs] Your TV is... [laughs] You... So you gotta really be- Yeah...

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focused 'cause they're just like, "We gotta get as much as we can upfront. Forget about these long deals that are happening on the back end 'cause it's- Yeah... it's gonna be a short deal."

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[laughs] Yeah, but I think it, it highlights this, and, and maybe this is a good pivot if you want into, into more- Yeah... media and maybe streaming.

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But this ZIRP era, specifically that last little slice during the pandemic, really kind of sealed the deals for these major players, right? Yeah.

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Netflix didn't only manage to build up a massive moat, the ZIRP era also led all its competitors to overspend and build a ton of debt.And so coming out of it now, Netflix is sitting pretty with a lot of momentum while the com-competition is in trouble, right?

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Even Disney. And the thing I find interesting is how Bob Iger is back in the seat going, "We're making too much stuff. We're spending too much money." You know, blaming the other Bob- Who, who made these decisions?

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[laughs] Who did this? Who made these calls? Who signed those checks? He's like the plumber who comes in who's like- Yeah... "Who did this work?" And it was like- Exactly... "Actually, it was you."

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That was you, [laughs] Matt Stier. He's like, "Oh." [laughs] Yeah. And, and Disney will likely be, be fine. But is there...

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I mean, first of all, do you wanna talk about streaming or, a-and is there an analog to the rest of media with that? Because I would say the New York Times also came out of that era like a dominant player, right?

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And it- Yeah... it wasn't maybe a few years ago. No, I mean, at the start of the ZIRP era, it was almost, there was articles being written about The New York Times going out of business, going bankrupt.

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Its survival- The failing New York Times... its survival was absolutely in question. It was somewhat in hock to Carlos Slim, Mexican billionaire. And then it made the pivot.

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I mean, he used the ZIRP era to make the pivot to subscriptions. And they, it was able to make that pivot and become like a lifestyle bundle. And then it happened to benefit greatly from something that happened in 2016.

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And long term, I wonder if, if that ends up hurting its overall, like, growth for its news product, but I think now its, its growth is increasingly gonna happen outside of news.

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Interestingly and intelligently, I think it invested in activities that are als-outside of news, right? Yeah. In some sort of... Yeah. And the gaming stuff.

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But I think what, what we saw in the biggest ZIRP phenomenon in media and publishing, obviously publishing and media in general is just different than tech.

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I mean, just the numbers are, they're just- Yeah, it's a bad business [laughs] They're just miniature.

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And I just, like, think about I-I've got family, like, in the biotech industry, and, like, you know, a big M&A deal here is like, wow, they got bought for $200 million.

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[laughs] Like, they do, like, $40 billion, like, tuck-in acquisitions [laughs] and stuff. I mean- Yeah... that's a little extreme, but, like, they do massive, massive...

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The, the money is just massive in other industries.

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But I think the thing within the publishing industry was there was, like, a trickle-down, and there was a lot of speculative capital that went into these scaled models that have failed.

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I mean, BuzzFeed was zero interest rate phenomenon. I think we'll end up looking back on it. It was never a profitable business consistently, okay?

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Like, I remember Jonah coming on, Jonah Peretti, coming on [laughs] podcasts. Long-time listeners will know that.

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Well, coming on the podcast I did at the time and saying, "No, no, no, no, we can be profitable anytime we want." [laughs] It's like, oh, really? Yeah. By what, like, firing half the company?

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And there was a tolerance for that across the entire economy. Now everyone needs to be profitable. I saw something that's something like 48%, or no, 52% of the S&P 500 is not profitable. I mean, it's- That's wild.

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That's the idea of business. Is that... Maybe I'm, like, not sophisticated enough, but I thought you- Yeah... you wanna make profits, right?

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Yeah, but I mean, if the stock market is speculative, and speculation speculates around growth, right?

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And that's what Netflix has been doing this whole time, is just gathering capital because it shows growth, and build a big old moat. So obviously that flips. That flips now with, with hire for longer.

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That flips to show me, show me. Don't tell me- Well, I think-... show me... the zero interest rate era allowed you to make stupid decisions and not be punished for them.

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You know, I talk sometimes about tech having generated a lot of unremarkable people that have made a lot of money and therefore now have a very loud voice, right?

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If you wanna hear that, you can just l- tune in every week to the All In podcast, and you'll get a good sense of what I'm talking about. [laughs] I like it. You get a punch-up that's good. They're very popular.

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And so it allowed... Being successful always requires some luck, but when there's a zero interest rate, luck happens a lot more often.

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[laughs] And so what we are seeing, though, is that a lot of these things were bad decisions. Like BuzzFeed spent too much time and money on news probably. That's one of the bad decisions.

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Vice did a bunch of bad decisions. Meanwhile, you could say that a lot of The New York Times decisions were correct, right? Maybe they had more leeway, but a lot of these companies made bad decisions.

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And Disney promoters often blame a lot of what's happening on market conditions. But Disney squandered and made too much content around Star Wars, around Marvel, because they had all this cash. They were putting it out.

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They were force- They were kind of telling everyone you have to watch everything, and people got overloaded. Mm.

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And I think they, they severely damaged these franchises by just, you know, having too much money and making too many stupid decisions.

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And what we can say to that is that sometimes having constraints in how much you can spend is going to help you focus on doing the right things, or doing a fewer things and trying to pick the right bets, right? Yeah.

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So how do you see this, like, hire for longer era changing, like, how people are gonna think about building businesses, both in tech and then in other areas?

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Well, the optimist in me s- thinks that it's going to help us focus on things that we can see brings true utility.

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It's coming alongside the AI era, so that is going to provide a lot of opportunity in media and technology to build brand new things at very different scales, right?

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I've spoken about this before, that I think, to me, the AI thing is there were these kind of financial moats that stopped you from creating a, you know, Hollywood star movies, in quotes, or running a specific type of media company that...

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And those moats are shrinking. But if I'm a little bit more pessimist, my worry is that we're going to see just, like, a contraction of new things.

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We're going to see less investment in interesting shows that showcase interesting voices.

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We're gonna see less experimentation around media formats like we saw lately with people trying all sorts of stuff out on the internet. Yeah. So I don't know.

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I think if AI wasn't happening at the same time, we might have a clear vision of what's gonna come. But I think AI is a disruptor- Yeah... that we can't predict. It's funny, I think, I think you're totally right.

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And I think in some ways what the pandemic was to ZIRP, like AI will be to hire for longer.Mm-hmm. Like they're, they're twin accelerants to some degree of a larger phenomenon.

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AI works its way into all of these CEOs telling their investors what they're gonna do. "Don't worry, we'll be making more money, and also AI is gonna cut a bunch of costs." Yeah, yeah. [laughs] You know?

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[laughs] Well, 'cause that's the thing- It's very handy... it's very handy because- Yeah... the stock market's a funny thing.

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But like, you're obviously, you're telling a story that the other, the side that has the money, like, or decides to allocate the capital wants to hear, right? Mm-hmm.

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And so the story everyone was telling was a growth story over profits, because that's what people wanted to hear.

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And now these very same people have to go to this exact same people who just all of a sudden now decide they want a different story, and everyone pretends that the previous story that both of them were telling to each other [laughs] didn't happen.

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And they're like, "That was someone else." Yeah. And now they're... I'm like, "But you guys are, you're both the same, and now you're just talking it totally differently."

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So it's- Is, is there any specific example you wanna share? There's no specific example. I just find that, I mean, you see it all the time, like, in tech, right?

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Where it was all about we're gonna, like, create the future and everything, and it's like year of efficiency. It's about efficiency.

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[laughs] I think the secret power of tech sometimes is sold as people who can see into the future, but I think it is often being really good at forgetting the past. That's true.

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And Apple has been so good at that as saying, "Hey, remember last year when we were telling, [laughs] telling you this thing? Well, just forget about that, because this is the right way to do it now."

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And a part of it is honestly just, like, related to the process of building stuff. At Airbnb, we would say, I mean, it's nothing new, but like, you know, s- strong opinions loosely held. Like- Yeah...

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this is the best idea ever, but if it turns out not to be, we'll forget about it, and it'll just be, like, flushed down the toilet, right? And tech has been really good at that.

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That Andreessen Manifesto is really good at forgetting that now that he's talking about this optimistic future about AI- Mm... he was also the guy shilling Web3, you know, a few weeks ago. Yeah.

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But like you're saying, I think there's two ways to look at it. That can be a bug or it can be a feature. Yeah. Right? And it, and- Yeah... it's both, really. It's a bug when it doesn't allow introspection.

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It's a bug when it creates specifically really loud voices that then end up s- talking with some authority as to how certain things should go.

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Chamath talking about his financial plan for the world after he read all these specs to the ground, it's funny. It's funny, but you know he believes it. He's trying things. He's in the arena.

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I don't even think it's disingenuous. I think they believe their own bullshit. That's the worst. That's the worst part, [laughs] is when it's not disingenuous.

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I know, and that's because there is such a, an ability to forget- Yeah... all your failures and remember all your successes.

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I mean, that's, just as a quick aside, and I try to avoid the political stuff, but, like, I listened to the Jared Kushner... I listened to almost the whole thing. He did- Right...

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like a, one of those three-hour podcasts with the robot guy. Lex Fridman? Yeah. I, I... How can you... So to me [laughs]

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Him doing the ads, by the way- It sounds like hell, listening to three hours of Lex Fridman and Jared Kushner talk to each other. That sounds like hell.

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His ad reads are, like, next level, and I was like, I was listening to him and I was thinking, I was like, "Maybe we can have a weird version of this where it's, like, Alex reading the ads, like, he's, [laughs] like, been taken hostage or something."

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[laughs] Oh. So it's giving me ideas. I'm always trying to come up with ideas, monetization ideas. But he had on Jared, Jared Kushner, and I think, like, a lot of people were, were like, "See? The mainstream media.

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The guy is, like, very articulate," as that. I'm like, "Of course he is. He's s- he's a smart person." Like, I mean- Yeah... I think it was, like, ridiculous that anytime- Raised wealthy, smart person.

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Yeah, he went to the- Guess what? They can speak good... best schools and, like, he's, like... I would hope that he would be a smart person, right? That does not mean you're a thoughtful person.

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Just, like, in talking through, I'm just, like, thinking that, like, there's no other factors in the world in these places where he was deciding that he was gonna make peace, that the only thing people wanted was, like, the opportunity to have a golf course nearby.

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It's like [laughs] they might actually have other sort of priorities in life than that. I love, I love that point that you make about intelligence, yes, but thoughtfulness, no. No.

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And I think that sometimes we confuse the two, and you can hear someone speak so eloquently, and then if you kind of, like, pull yourself away from that kind of allure of intelligence and, "I should be listening to this person," you notice how much full of crap they [laughs] Yeah.

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And it's confidence as well. It's confidence, right? It's confidence is what you're saying, as if there was no other truth. Yeah.

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I do think, one, like, tangential zero interest rate phenomenon that will fall away in some ways, because I think we're seeing the slow death of public social media.

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I think what is going on right now on Twitter, X, whatever you wanna call it, in the wake of the terrorist attacks and then the subsequent war that is gonna be happening, I guess it's already starting, it, it's irredeemable.

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I c- I can't imagine opening and finding this a useful dialogue. And I've just noticed that, like, so many people are getting caught mostly by their own words and actions at a very fraught time. Mm-hmm.

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There was an Eagles player who didn't wanna go over the middle 'cause he'd get hit, and he was like, "Well, I'm not going for that ball." [laughs] Like, for who? For what? Like, there is just no way. Right.

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People are gonna st- are gonna pull back, and I think it's overall gonna be a messy thing, but a good thing from this idea that everyone has to be taking political stands on every...

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or, or just commenting on every single issue that is happening in the world unless it applies to what you're doing and you're it.

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Like, I, I think everyone should feel free to express themselves, obviously, however they want.

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I just think that it went to a point where, and obviously it's, it's very acute within particularly, I think, the VC community, or maybe they're just, like, loud and powerful, so we have to hear them all the time.

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It's like, it's okay. You do whatever you do. You don't have to be, like, a geopolitical strategist and comment on every single political issue around.

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And I think a lot of people are reaping the whirlwind of that right now. It's a really fraught time, and it actually has made a lot of social media just really painful to use, like, pretty directly as well.

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I'm hearing that a lot, right, where people says, "I, I can't anymore. I can't. I..." Uh, yeah. To...

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Like, everybody's with their takes or attacking their takes, and it's kind of gotten to a place where-It went from like- You know-... Virginia Slims to like menthols. Yeah.

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[chuckles] Or, or like, you know, a, the a party where everybody's getting drunk, and you had a good time, but it's past like midnight, and now there's a few people getting a little violent- [laughs]...

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and you kind of have to get the fuck out of there. Why are those guys head butting each other in the corner? [laughs] Exactly. Exactly.

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And it is fraught, and not everybody needs to hear your take, but it has had this- No... this, this impact on social media. There's a time and a place for your take.

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There is this tech summit, tech conference, the Web Summit. Do you know of it? It's like- Yes... this sprawling... I've been a couple times. Not recently. [laughs] I need to, to distance myself from this thing.

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And I'm shocked at, like, how big this thing had gotten.

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I went when they were still in Ireland, in Dublin, and it w- it became too big for, like, Dublin and, and it moved to, like, Lisbon, and now it's doing one of them, I think they do a few of them now, they do one in, in Toronto, in Qatar?

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Qatar? I always say Qatar. Qatar. Qatar. Qatar. Yeah. I would used to say Qatar, but I hear people say Qatar. No, no, no, that's... I wanna sound sophisticated. Qatar. Oh.

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But not, like, too sophisticated, where I'm trying to, like, pronounce a word in a language I don't know. [laughs] Like the guy, the guy that says, "Oh, do you want to go to karaoke?" Yeah. My... Well, my mom does.

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She says Paris. Mom, if you're listening- I mean, that's [laughs]... it's fine. It's so funny she says Paris.

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[laughs] I, I speak French, and I still call it a croissant because if I go into a bakery and call it a croissant- Yeah, no, you see-... I feel like a right asshole. Yeah. There's a lot of those people in New York.

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They don't speak French at all. Mm.

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Anyway, he decided to get on Twitter directly after X, whatever, right after, yeah, the terrorist attack and put forth his view of what was going on in, in Gaza, and then he's saying he's- it's war crimes and all these things like this.

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And, like, he has been un- under, like, constant attack. Now, the latest is he, he went onto the...

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You know, they, they go through these cycles of like, "I will never back down," and it's like an apology, [laughs] you know, like seven hours later. Which I'm sorry to laugh- Right...

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'cause I know a lot of people really out, you know, take them- Well, you know, one of these pathways is, like, I will never back down, an apology, and then it often ends up in the right-wing speaking circuits or something like that.

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But in this case, it might not be, it might not be there, you know, if you go, if you get pulled down enough.

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The, the thing is, like, r- right or wrong or whatever your take is in the end, it's just not your take to make, and we forgot about that. And people feel, uh, the urge to have a take on whatever's happening in the news.

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And when things are pretty chill and easy, it's easy to kind of have content to share on social media, and if it's not, then you feel you have to step in there, and often rightly, you're gonna get, like, in trouble for it.

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Yeah. And what I'm interested in, the last thing I wanna, like, talk about on this, is how this will affect how companies are built and staffed, 'cause I think there's a few things going on. AI is coming.

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It's obviously- Oh, boy... it's being incorporated.

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I don't know if you saw, I s- I shared that in our, our text, Stack Overflow laid off twenty-eight percent, and they're sort of blaming, blame the LLM, if you will- Of course. Of course... which is gonna be- Of course...

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a convenient dodge for a lot of co... I don't know if that's the case, but- But I, it is-... it's convenient... a hundred percent the case.

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Any type of content, this is the first content to have been fully absorbed by the LLMs and can be provided in a better fashion than the source can.

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So there's no reason today to, to go onto Stack Overflow to search for an answer. Okay. So- There's no reason... you were talking about this being a free consulting call.

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Let's just say you were, like, building, like, a small media company, [laughs]

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and, you know, your core is kind of typing words onto the internet, then maybe you do some podcasting too, some exclusive private dinners, a white paper, maybe a webinar if you're feeling frisky. Right.

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How do you, how do you think about...

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Because e- obviously, anytime you're starting something, I feel like you obviously want to not put yourself in a disadvantageous position that the legacy players who have so many advantages over you have.

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I mean, the biggest advantage you have is that you don't have all the built-in processes and infrastructure that they have. So what- Yeah...

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how do you think, like, building companies overall will be different in this hire for longer era, and particularly in an era, in a industry like media that is, has other secular challenges? That's a good question.

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It's a very hypothetical question right here. That's great. Let me answer it maybe at a higher altitude first so I can kind of formulate some of my thoughts.

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I think we're gonna see pretty big shifts, and a lot of that is a correction from ZIRP, where the manager class is going to be severely reduced. Mm. People who manage other people, team sizes are going to...

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And at the end of the day, I think if you're not bringing a capability that can be either not affected by AI at all, right, which is like you cut hair, or augmented by AI, which is, you know, you're an engineer or a designer, then you're kind of in trouble.

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I think there's a lot of jobs that are given to junior folks coming in that will no longer be required, so I'm worried a little bit about the pipeline of people moving into careers, right?

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Like, a junior data scientist can be often replaced with a query, and I think it's going to be the same in, in media companies, where a lot of that research and stuff like that can actually be done by the writer themselves rather than having a researcher- Yeah...

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on a piece. But I think what... That's not to say, I mean, obviously companies will need to have de-risk from that.

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And so it seems to me like, obviously, you'll need to have, like, apprentice system, like apprenticeship. Yeah, although it'll happen. I just don't know how quickly it'll happen. Yeah. Right?

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We've had a, an issue with hiring in Silicon Valley for a long time and talked about apprenticeships and stuff like that, but we never really managed to get the pipeline going, which is why there's a lot of recirculation of the same people across all these companies, right?

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And then when you end up to the leadership level, I, I'm helping a lot of companies with leadership searches right now. There's a handful of people [chuckles] that...

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Because a lot of folks made a lot of money and retired, and then, uh, a lot of other folks kind of coasted at Facebook and never did any meaningful work.

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There's gr- great people at Facebook, and I've hired many of them, but I'm just using them as an example.

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I think for a small media company-It's gonna be really interesting because at the same time as AI allows you to do a lot of this stuff, creative work that used to be really expensive, a really big moat, pretty instantly and very cheaply, it- it's also going to mean that the space is going to be flooded with it.

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To me, the people I would hire, it used to be, well, you would've been like, "Well, hire as many people that can... You can delegate to," right? To free your space and mind up to do kind of the important work.

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But I think that right now- I think that's an ex- I think you, by the way, I think usually people say that 'cause they don't wanna do the actual work. Well, it's just work. I don't want to do it. It's like, why there...

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And so why there's so many podcasts? 'Cause people don't wanna write, 'cause it's harder. And some people like to write. Do you like to write? No, I don't. Oh, okay. All right. I mean, some people like to write.

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I do it, I do it to make a living. I like to do some stuff that some people- No, I like to write... find menial. But it's more painful. It's easier to, it's easier to come on a podcast and talk than it is to write.

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That's why I would always tell people- Oh, yeah, yeah... when they- It's definitely... everyone wanted to come and present things, and I would say, "Write it down first, then we can discuss it."

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They're like, "No, no, no. I wanna walk you through it." And I'm like, "Oh, you've lost me on walk it through. I don't need to be walked through something. I'm not, like, a child." Like, I can read. Wow.

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Well, it's a dodge. It's easier to bullshit when you're talking than it is... When you write stuff down and you're full of shit, it's very obvious.

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It's very obvious you didn't think things through, and it'll be obvious to you. Depends on the medium, right? It will be obvious.

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And if someone is not a professional writer, the problem with being a good writer is that you can fake it a lot easier. If someone is not a good writer, they can't, they, they can't fake it. Well, guess what?

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With AI, there's gonna be... It's, it's very easy for me to write a, a pitch nowadays, so.

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But I would, I would say I don't know yet how companies will stand out in an AI era, but I think it's the same way it's always worked, that you do something differentiated.

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And so I would avoid hiring people that you just feel are going to be doing a task within the company that you don't wanna do, and hire a lot less people, but find people that can really have a good sense of the, the media you're trying to create, the culture you're trying to reach, and use all the tools at, at their availability.

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I can't...

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And, and so it's kind of a non-answer, but I, what I'm trying to do for the studio right now, we're, we're making video games, everybody on the team is additive to building the game in a way that is also creative.

252
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Like, they all have tasks, but I don't have people on the team right now that are just doing a task, read a list, and check on a task. 'Cause I think the world's changing too fast.

253
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So would that have been different if you were doing this five years ago? Yeah. How would your team be different?

254
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I would have prioritized just getting people to just get the work done and come up with a concept and work with them, and then distribute the task across the team and hope that we can scale it as the project scales.

255
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I think that right now what I really need to get is people who understand that the world's changing really quickly, either because they- they'll find ways of using AI intelligently that makes it feel different, but more importantly, find things to do that cannot be easily replicated with AI.

256
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I, I don't think we talk about that enough, but I am constantly talking about trying to make something that says that would be hard to do with AI. Yeah. That imperfection, that weird thing.

257
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And sometimes I'll say, like, I'll give feedback, like, "That looks like an AI made it, and it's great, but it looks like... I don't know, it doesn't make me feel anything."

258
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And so I think that if you're going into media, a lot of the advice right now is, like, how to hack AI to scale your media business, but all of these things are going to eat themselves.

259
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Like, there, there's nothing there at the end of the day. Use DALL-E 3. It's incredible. I, I've been using Midjourney. That's my- I mean, forget Midjourney. Like, use DALL-E 3. Oh, really? I already paid.

260
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I think it's in- Well, okay. Just- It's- And I'm on Discord, and you know how I feel about that... twenty... Well, um, DALL-E 3 has an app as well. [laughs] And it, and it allows you to have conversations with it. Sold.

261
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So you c- you can give it feedback. And some of the stuff is indiscernible from stuff that a, a human designer would create, and it doesn't only create, like- But you say that as a designer. Could...

262
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Do you really believe that? Yes. I know that to be true. Really? Yes. 'Cause I guess- Yes... I guess from the standpoint of writing, I've yet to see... And again, it doesn't mean that it cannot.

263
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I go back to, you know, Trump being described as, like, a poor person's ver- [laughs] a vision of what, like, a rich person is like.

264
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The kind of writing that I see is what someone who can't write thinks is normal writing. Like, it's terrible. It's stereomanualistical stuff. So I, I've yet to see... I'm not saying it doesn't exist.

265
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I've yet to experience- But, I mean, what are you comparing it to?... generative AI writing something that I personally find, quote-unquote, good. Can it, like, regurgitate, like, the steps of, like, a recipe? Sure.

266
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Yeah. Okay. But if that's what you're doing, then... So first of all, I think you need to look at the trajectory of where this technology's going. Right. Oh, this sounds like a ZRTP mindset.

267
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W- No, I mean, i- i- it's more- No, I get it. Go on. Over the past 12 months, we've kind of been the frog in the boiling pot, where we keep saying, "Oh, but it can't do that yet. Oh, well, now it can.

268
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Oh, it can't do this yet. Oh, well, now it can." Right? And I also know that we don't know how to use these tools that well.

269
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You can give it a prompt, but then if you keep talking to the machine, that text will be improved over time, and that conversation will take a little bit of time, but less time than you would've taken to write the whole thing in the first place.

270
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Okay, so how does that affect how you think long-term about building the studio?

271
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If you're, like, playing out, "This is where AI is today, here's where I think it could be in three years," and who knows, maybe that's in, in one year with these developments.

272
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I don't know, but I'm fairly certain it's gonna be there within three years. So, like- Mm... d- how does that affect and whether...

273
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I think to me on the abstract level, I think about, okay, it's better to be as lean as possible, to have as much flexibility as possible. You have no idea about so many different things.

274
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I mean, you don't have an idea anyway about how, but you don't want it to paralyze you as far as, you know, not making decisions.

275
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But how do you end up, other than staying, like, lean and nimble, the obvious, how do you prepare for where this is going?I don't have a clear answer yet. God damn it.

276
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The thing I'm doing is that I'm remaining deeply paranoid about everything that we make that I feel could be replaced by an AI.

277
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My bet is that in a world full of AI-generated shit, people are going to seek out things that either feel or they know to be human-created.

278
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I think we trade in stories, and those stories only matter if we know that there's a person behind it, which is why celebrities exist, which is why when you go to a museum, the art is as important as the artist, right?

279
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The way it's presented. Mm-hmm. Right? And so that's my bet.

280
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So eighty percent of my time, I would say, is spent trying to figure out how do we make this as human as possible so that it feels different to anything else, to the flood that we're going to see. And you know what?

281
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Gaming is probably furthest down the line of, of impact here because games still have a massive moat. It's still very hard to build games and to build feel and, and all the components that need to go in a game, right?

282
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But yet eighty percent of my time is spent on that. The other twenty percent is spent trying to figure out all the non-creative things that we can replace with- Yeah... that we can accelerate with AI.

283
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You know, building frames of animation between the things, some abstract background, helping us code specific things, et cetera. All that stuff, we're making sure that we kind of accelerate.

284
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The rest of it is, I would say, is like try to make yourself indispensable. Indispensable in an era where AI is coming to do everything you know how to do. Mm-hmm.

285
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There will be a time not long in the future where I can ask AI to write a Brian Morrissey thing about a thing. It'll never be the same, Alex. But you might be the only one to know that. [laughs] I know. I'm just kidding.

286
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And so what happens when your competitors that have newsletters release seven newsletters a week, fourteen podcasts in every language, and yeah, I mean, you're doing a face, but what I'm saying is- I'm not doing-...

287
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that is not the- I'm, I'm considering it. [laughs] Yeah. But at that, so, so- I'd be flattered. First of all, I'd be flattered.

288
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But rather than going into that fight, I would say my time is spent entirely on how do I stay out of that fight? Because that fight is going to be a bloodbath. Nobody's gonna win that fight.

289
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The only persons gonna win that fight are Microsoft, Google- Yeah... all these guys.

290
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I think that's, in general, I would, I would always say, like, during the last year, uh, it's not a good track record for trying to out-Google Google. Like, [laughs] whenever anyone- No...

291
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was saying, "Oh, we're gonna do what Google's," I would skip that strategy. You don't need to continue.

292
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[laughs] If the Zerp era benefited the top five percent of the companies, you know, the largest companies, the AI era is going to likely do, do the same. So...

293
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And I think social media's going to be destroyed by everybody needing to have a hot take, but also just content is going to be free. It's gonna be everywhere. I mean, if the bots are bad now, I can...

294
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I, I sort of have more, I don't know if sympathy is the right word, but I, I sort of understand- It's what Elon- Yeah.

295
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Well, I do think that, like, it might be one of those things where he said so many crazy things, but, like, he was actually telling the truth about, like, the need to, like, do subscriptions in order to, like...

296
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It's the only thing that can, like, stop the bots. Like, he might actually, he might actually be right on that one. Yeah. I mean, I think to his credit, Professor Galloway was saying that. But it's also been...

297
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It's a very old idea. Do you remember when they were trying to stop s- email spam? Oh, yeah. I love those. Postal Service ones, the one that they wanted to have stamps, e-stamps. Yeah. Like one cent- Damn it...

298
00:47:10.042 --> 00:47:18.542
to send an email. I was the email- Just make the- I was the email beat reporter at DM News. Oh, wow. I know. So you, you were there. And look where that went. I sat in the belly of the beast.

299
00:47:18.942 --> 00:47:28.711
I was partying with the Postal Service guys. I've told you guys about this. That's a good... [laughs] I mean, the Postal Service the band or the- No. No. Like li- Okay. [laughs] That's, that's less interesting...

300
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mail deliverers. [laughs] They used to be mailmen. What are they now? Like, they're mail deliverers. They wear shorts too, at least in Miami. I think they wear shorts- When I was growing up, they didn't wear shorts.

301
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They wore a proper, proper uniform. Just, like, suffered for, for you all. [laughs] But yeah, I would say, like, try to stay out of the fight. Yeah. Well, I think- And Chris Kimball mentioned that, right?

302
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Like, he saw magazines and all these shiny covers and pictures, and the way he started doing it was like, "Let's go black and white." Yeah. Six issues, expensive, and that's how you stand out. You build a great business.

303
00:48:02.022 --> 00:48:14.022
Yeah. That's come up a few times, actually. Media lost almost all of its moats, like, long ago. Gave them away. Well, either way- Right... they lost it. Gave them away. Gave them away.

304
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Here's all our content because we need traffic, we need scale. Scale kills media every time.

305
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But now the, the interests are aligned, I think, the market interest, and it's always basically an alignment of, like, what are you going to incentivize people. The incentives are to build distinctive properties.

306
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So it's gonna be a painful period, but when I look at, at some of the more promising publications that are being built, I'm not saying all of them are gonna work, and they certainly are not gonna be what Vice and BuzzFeed were claiming that they were gonna build.

307
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I just don't think that those dreams of these many multi-billion dollar [laughs] digital publishing companies are just probably not gonna happen.

308
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But I think that they are building smaller and more durable models, and they're doing that by, one, being distinctive, and two, by completely opting out of competing for budgets with platforms.

309
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Like, there was this period of time where publishers were fooling themselves that they could compete in any way, shape, or form with the might of these companies. I mean, this is... I'm trying to think of like- Yeah...

310
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a minor, the most minor house in, uh, Game of Thrones, like, going up against the Lannisters. I mean, it would be like they were going up against these companies- Tullies?... that... Yeah, the Tullies.

311
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[laughs] I don't know. Well- They, they were pretty strong. Yeah. Even every house in Game of Thrones had some sort of ability. Here you're talking about somebody- Well, they were distinctive. That's the thing.

312
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They, they always- Right... had some twist. Exactly. But yeah, you, you...

313
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They thought they, they could compete with somebody who was at the very top of their funnel, had unlimited cash, had, you know, a huge technology advantage. It was always a losing battle.

314
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I think a Zerp phenomenon we haven't mentioned, but maybe which is good in closing, is the fact that it kind of told everyone that you couldn't be successful unless you had a billion dollar exit.

315
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So everyone chased that.And a lot of really good businesses are never going to be billion-dollar businesses. So we lost a lot of that energy.

316
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But I've talked to more than one person in tech, and they've told me, "You know what I wish? I wish I could just build a business that makes five to ten million dollars a year." Yeah, that'd be okay. That's fine.

317
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And I'd just be happy. And I would tell them, "Well, why aren't you doing that?" I'll take that loss. It's just like, "Well, I can't raise money at that thing." And also, like- Don't raise money. Even better.

318
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You're, you [laughs] end up having a better, uh- It would be seen as a step down. But that's what I'm doing.

319
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Y- I tell people that I meet, you know, at, at kind of shindigs or get-together, and they had expectations for me to raise a bunch of money or now be in AI after I left my big, big job.

320
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And when I'm telling them I'm building an independent video game studio [laughs] and it's not gonna- They're hippie... grow beyond 12 people, they're sad for me. They look sad. [laughs] Oh, really? Yeah.

321
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They're concerned. Yeah. I went through, well, it's be- it's wo- it's better for you. And then we'll have to wrap this up. 'Cause, like, I went through...

322
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It stopped recently, but for a long time, like, people were very concerned that I couldn't find a job. [laughs] I was like, "No, I'm actually building my own thing."

323
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[laughs] But they did, they were like, "No, seriously, like, you don't have to, like..." Yeah. You won't have to newsletter every- It's okay... forever. You'll be fine. Okay. I know it's hard out there.

324
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[upbeat music] Anyway, this was fun. Troy, we miss you if you're listening to it, but I don't think Troy's listening. Yeah. He's on his own. I think we missed your class.

325
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You should drop, you should, just to screw with him, you should drop his photo from the, like, podcast start for this one. Just for this one. Just put a big X on top of it. All right.

326
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Do you have a good product or any view from whatever or no? We're gonna wrap up. No, I don't, I don't have one offhand, and I have to get to a sales call, so [laughs] gotta wrap it up. Okay. More with less here.

327
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Wrap it up product. Post SERP, you gotta, you gotta be a five-tool player. You gotta be- Good product is advertising on the Rebooting Network and- Absolutely...

328
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maybe getting, uh, Brian to, uh, sit down and have a meal with you guys. Yeah, private dinner tonight. Very excited for it. I forget where. It, I think it's up in Candiverty.

329
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But it's not tonight because this is posting in the future. But, you know, it's important. Yeah, well, and then got another one tomorrow. It's gonna be... It's a big week.

330
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And then, oh, yeah, tomorrow's also the Self-Serve Ad Summit, powered by Dan Ads. I thought you were running out of time here, but you always have time for advertising. [laughs] All right. All right. Thank you. Cool.

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Rate and review us and share it with your friends. Thank you. Thanks to all the new listeners. Bye. [upbeat music]