Welcome silicon Sally. We've been had welcome to Jad
Cat episode about how Sam Venkman freed fooled us all
Trick the world. The ultimate con.
It's been the craziest story in Tech.
Like, I don't know, I think since, I mean, I covered Uber so
closely, but I think this is crazy.
I mean, in terms of 0 to 100 this, Is the biggest scam CEO
story. Since we've started covering
Tech design, we disagree with that.
Well, first of all, I would say 100 to 0, not 0, to 100.
And, and to go full Bill Simmons on this here.
I would say we're looking at, maybe what is one of the
craziest weeks in VC like Tech History?
Like, I think this got a rank up there in terms of one of the
most just like astonishing story lines, hilarious characters,
being, you know, brought up to the This is got a rank up.
There's got to be top five. Did I introduce Our Guest?
We have teddy slavery early. I think we just will just want
to jump in people. Figure it out, figure it out,
halfway through. Its got the fedayeen here,
Teddy's life or you can't see the video here but he is he's
looking like Yasser. Arafat his prime.
I'm pretty sick, daddy. We've called you the ask me off
whisper before, you know now, Alex?
Yeah, I've gotten a few texts from people who are like, sorry
for your loss. Such a good story.
Or, like, I think is reporters always.
I love, you know, maybe consciously or unconsciously
like I'm betting on storylines, right?
Right people you think are interesting and obviously Sam is
still interesting for other reasons.
Very interesting, I would have more interesting but however
I've gotten a few messages from people that are like suggest
that you know, Odin better for you know my career if he was
exploring the read between the lines for the listener a little
bit, I mean you in particular cover sort of philanthropy and
wealth and this is a guy who is doing In the most interesting
stuff. I mean, funneling tons of money
into effective altruism using as well, swearing.
He was going to give it all away.
And so if you cover the philanthropy wealth beat, and
you have this guy who's pretty open about it, creative about
it. I mean, it's just the story that
keeps on giving, I mean, that's what you're saying.
Yeah. Yeah, I mean, you know, look, I
mean, he shot out of a cannon. I think I do think it was 0 to
100, 100 100 0. I mean, he is someone who I
first talked to Sam and like September 20 20 was off the
Record but it was based sandwich, starting to do more
and more political donations. And at that point, like no one
knew who he was. This is not a brag.
It's like a point about like, the speed here and I stand back.
Yeah, well on me. Nobody even realize until
reading some of the stories that FTX is.
Only a three year old company. Like this motherfuckers only
been on the scene since like the last year's of the Trump
presidency. It's like this guy's been like
hanging around the hoop for a long time and finally had his
moment. Sure, he fucking came out of
nowhere. I mean, I'm like, yeah, I agree
with you 100 0 to 100 and then 100 is 0.
But like that progression is basically a super car that got
200 miles per hour and then crashed into a cliff, right?
I mean, glass we guide coffee with someone who is sort of in
his orbit and it was like a totally normal conversation.
I think I said something along the lines of like yeah I'm not
one of them just about interested in the story.
Any more like you know, I'm covering?
You know, I'm interested in Peter teal stuff and other
characters like Didn't you guys stop reading like the sandbank
been freed profiles like God six months ago.
I am so I never wrote one, you know.
Yeah. How long before he was flooding
the zone for a while, right? He would appear at everything
like hilariously enough, he was just at the Wall Street,
journal's Tech conference, you know, he was being interviewed
by an editor over there. But that guy would not turn down
a lot of interview requests and so he was playing this perfect
game with the media which was, you know, appearing as this
Accessible understandable familiar eventually figure
within a community that is often the opposite of that.
And it was such brilliant presentation.
But look, there's so much to talk about with this but I feel
like we have to do like, a little.
Let me give the foot a little bit quick.
I'll do the quick footnotes in classic fashion, you know, at
four and a half minutes into the episode whatever.
That's why I say don't even introduce the guests until like
20 minutes ago. Right?
Exactly leave. One out for we have a high
information audience. They know Teddy by voice and
they know Sam Baker fade because I read every story.
Yeah. No, my initial right Sam,
bingaman free who are all going as p.f., you know, grows this
firm Alameda research which becomes like a major crypto
investor and then because of the success of that firm, I mean he
and all this story will be scrutinized for probably like
decades at this point. So this is all based on sort of
the public narrative, but the story was that this is the guy
who figured out how to sort of connect, the there was always a
gap in the price of Bitcoin in Asia in the United States.
It's and he helped close that Gap and pricing.
He was an Army is an Arbitrage Trader and made a bunch of money
on that his experiences ARB helped him to found ft x.
Which then became one of the largest exchanges for
cryptocurrencies outside. The United States, he ended up
raising two hundred ten million dollars from Sequoia the best
Venture Capital firm in the world.
He raised billions of dollars at very high valuations.
I think he got up to thirty two billion dollars.
There's a hysterical story that Sequoia self.
Published by the ultimate piece of like propaganda.
That has them just like fawning over him and he's playing like,
legal Legends on the side, which they don't even know at the time
and like, somehow that spun into a positive and the guy is like
we could sell bananas on FDX, we could sell everything and you
know it's the total like we can build world so he builds up FDX,
can I stop you for a second there?
Because I didn't read the article.
What does that mean self-publish to they just put it on
Sequoia.com. Yeah.
Yeah it's like hired like so I think it was a magazine writer
but I mean it's a colorfully written magazine article.
It's Fawning. But so they basically just had
like the kind of played in a 16 Yankees.
It was a go directing, it's the most it's now the most like,
high-profile instance of going directors, what people want they
want, they don't want, they want to cut us out of the loop.
They want to go straight to the consumer actually and is that, I
mean, it shows exactly how every action has equal and opposite
reaction in the, you know, you make a story so glowing that
then when something bad happens, you look like an absolute fool
to the point that Sequoia took the magazine style profile down
Replaced it with like, it's letter to limited partners.
Basically apologize to get that. Yeah, the same time, the article
which the media doesn't do, you know, even a correction on you.
Try not to just delete things but they're screenshot everybody
fucking. I'm sorry.
Sukhoi. This kind of intense your
integrity as a media outfit. I mean, I just think people are
not going to trust you anymore. I've just canceled my
subscription of Sequoia monthly. All right.
That's a very disturbing back on track.
So FDX seems like top crypto exchange as Teddy's going to
talk about Sam. Bregman freed.
I think it was the number two Democratic donor recently.
What's the number you? Yeah, it depends on your
definition is a top Democratic donors, though.
He also promised some money that I think didn't come together.
Which I think we can get into, but then coin desk who did great
reporting. And I think also some of these
like, you know, random Twitter accounts that I'm not even in
insert deep enough in crypto world to know about.
But, you know, people start to say something seems off with
Alameda has the investment arms. Balance sheet.
It seems like they hold a lot of FTX is made up currency which
super worried. And then basically, you know,
people start asking questions and all of a sudden it becomes
it seems the oh allegations. What people sort of think
happened is that xdx. Use customer money like billions
of it to basically Shore, up Alameda has sort of failing
positions. And once you start, you know,
using customer money to, like, just gamble it away and try and
make up your losses. You know, that's how every big
scam comes undone and that's what happened to Sam bank
manfried. So.
Yeah, and that's happened. The last, like, few days.
I mean, and we basically find out for sure, because Sam
bregman freed says, we're going to get bought by, by Nance and
it's like clear that it's like a fire sale by Nance's arrival,
Real Enemy of ft x and then, that doesn't even come together.
And today, we're recording this on Friday, I think they filed
for bankruptcy. And yeah it seems like it'll
keep getting worse and he stepped down as CEO which was a
shocking turn of events here. The end and the guy they put in
charge is the guy who dealt with enron's collapse.
Yeah. You see that?
Nice to have on your resume their, it's like, oh no, we've
gotten that. You brought in the Enron guy to
help check out the balance sheets, right?
The last Asia. I mean this is gone 2-0, right?
I know you initially said that I was skeptical, but if you're
filing for chapter 11, you've basically assume that I think
this is how Sukhoi explaining to their Partners.
We expect our position in FTX to be worthless.
Oh yeah, I said I was going to 0 right away.
I don't know why you were skeptical of that.
Well because they had spun it. You're also the guy who thought
Blake Masters was going to win in Arizona so oh wow.
Yeah fine. Later in the episode on that
one. I'm glad we have teddy here for
that but but no here because I initially had read the spin that
Sam brankwyn free did put out that this was just about ft
x.com. F DX, dot U, s-- is couldn't be
stronger. We're actually going to be, you
know, buying the naming rights to another Arena.
So we feel as good as we've ever felt about that.
So I was like, oh, maybe you know, I just didn't know.
I assume that there is some Salvage will part of this
company but no, it's all gone. It's all flushed, down.
The toilet SPX basically walked into Sequoias office with his
fucking shorts and his slide. And as like, will you give me
any money to save this thing and they're like we just rescinded
are glowing. So it seems like so quiet didn't
know until really late. I mean, yeah, I wasn't, I wasn't
asked you Eric to what extent, you know, since you reported the
most on the investor reaction here like to what extent do you
buy? The spin that?
Like we had no idea versus you know?
Right now I buy it. I mean why.
So I was not unlike a formal board.
There's some reporting there was like a board of Weird insiders,
but they're sort of like an advisory Council of investors.
But I mean, this Alfred Lynn, you know, the guy who invest in
doordash, and a board member of Airbnb, very successful VC often
at the top of the Forbes, he was the Midas list.
Number one, at one point, five ways, he's not a crypto expert
and he's like their main guy on F DX along with a growth
investor. And so I just don't know how
Savvy they were. And I do think you're sort of
relying on the statement, you know, if you don't get an
outside auditor they're relying on.
Of the honesty of of the company.
I mean, I think they look extremely bad for not knowing
and every investor basically every other investors like well
Sequoia invested its this is a sure thing.
You know, I mean I literally have people admitting to me.
Yeah, we sort of outsourced, our diligence to Sequoia on this
one. Like they're, I mean, they're
not even Heidi. I mean, it's, you know,
anonymously but they're not really hiding the like, well, we
thought Sequoia and Sequoia in their letter to limited partners
was like, yeah, we do diligence, we do a lot of diligence.
I mean, they, they do see themselves as the firm.
This isn't quite and recent, It's like we take bets, you
know, but Andrews. No additional work required.
Andreessen Horowitz. Yeah, right Sequoia.
You know, did say, you know, we're in the business of like
Risk and and so, some have outside returns and some don't
have you ever seen a VC firm Daddy?
You Gonna actually out here and asking questions, but I have you
ever seen a VC for? I'm genuinely curious because
Eric, you cover this world more closely than Tom.
Or I do like, have you ever seen a VC firm Tweeter?
Frankly publicly release a letter to help ease.
Before, I've never seen that know.
I've never seen what I think just speaks to like and it came
out to these, right? I want some credit, I don't
know. Okay.
Certainly, I got a lot of those facts out before they did.
And wrote a very negative story about Sequoia and then they were
doing my favorite part of the Sequoia letter was at the end.
They said, we look forward to backing csps.
Next venture, we're very excited about what the future holds with
Sequoia has be. He's joking.
No, we're not. People were just believe that
that Andreessen with, you know, saddle up and like give them.
Of course, you know Andresen. I mean, the funny thing this is
sort of a side and then Teddy I want to ask you some questions,
but you know, Andreessen could invest because they were big in
coinbase anyway, but this is extremely validating to like
Marc Andreessen worldview, right?
Like SPF is like the perfect Democrat.
All the media loves him because he liked shits, aren't crypto.
He's not really a True. Believer is like a money guy.
He's deep in Democratic politics, he has like this great
philosophy of effective altruism.
He loves him so Teddy were you had or like I mean you're not
like a crypto reporter but like the, the media love this guy.
Hmm. What's your reaction to that?
No, I mean, look, there's an element of I guess I kind of
feel like maybe Sequoia does. The only difference is that I'm
not investing hundreds of millions of dollars into this,
which is like I'm not expert on crypto, right?
I mean Samuel legitimately was one of the, you know, five
biggest Democratic donors in the country, you know, the lobbying
work queue is doing and the philanthropic work you He's
doing we're genuinely newsworthy.
Like I mean I don't feel had. No I mean I feel like obviously
I feel had in the extent that like you know, the business
venture of that that was propping up all the other work
he was doing, was clearly on ethical illegal, choose your
best word but what he was doing was 100% newsworthy.
Like, you know, he was headlining Congressional
Retreats for Democrats and Republicans, you know, they
bought a townhouse in Capitol Hill and was like hosting.
Tons of, how do you legislators all the time?
Like but here's, here's my. Question, here's my push, back
to you on this Teddy because in one sense you are in the
business of explaining his philanthropic work, but you're
also in the business of profile in the guy in understanding
where he sits now. I understand you're not a crypto
reporter so you wouldn't have had the sourcing or the
attention to find out whether this was all built on a giant
over-leveraged house of cards. But in writing so much about the
guy, you do sort of help build up his reputation.
You helped give him the kind of access to the world that he
wants to have access to. And do you not feel at least?
Partly responsible for helping to build up that reputation in a
way that benefited him, even though it was also
foundationally week. Sure.
But that's like, that's the way the world Works, which is like,
you know, when Pete Buddha judge right?
Does a bajillion interviews and is genuinely interesting, does
that help people to judge in the Democratic primary?
Of course it does. But like, I don't think the role
of a journalist is to say no to good interviews.
Like what am I? I don't I don't I don't think
about this. I guess I guess.
I don't know what you guys I know journals going to scream.
About this. I don't think that much about
the consequences of my reporting and I say that not to be
callous, but I like like, sometimes you guys ever
encounter this with the with the source or the story or a company
is like, oh but if you write about our fundraise, it's going
to empower all my fun. Oh yeah, I don't give a shit.
So no, of course, I know it's my fundraise.
So whatever. But like, but I, but this is
this like a more generalized point that like, I feel like if
sandbag manfried is a interesting juicy story then,
Like that's kind of where my right like field of vision kind
of Lile bit okay. That's does that like legitimize
him? Like Daddy is not whatever Teddy
is not. I mean you're writing for
insiders and there's no question that like for insiders and
donors like this guy was like a huge player and that he's he's
propping up all these organizations.
I mean, I, I would blame a little bit more not to let our
friend off the hook but like, some of the magazine, articles
were people really spent time with the guy right there.
I mean, that right there, that's the Because if you're going to
be profile, the guy, I don't know anybody, I don't know.
And it looks like, I don't know if you ever did like a full-on
profile of SPF, and by the way, I don't want to pick on you.
I'm really glad you came on. You're obviously an expert on
SPF in a very specific part of his life that turned out to be,
you know, not what it really, you know, he presented it as.
But if you are profiling, the guy, you have a responsibility
at least somewhat to raise questions about his validity as
a character and whether or not his business that he's built it
on is at least questionable, you know?
No, I guess that was the shocking thing about this whole
episode to me was that you know in addition to him position
himself. So cleverly to the media, as,
you know, a very familiar face, he had kind of a Zuckerberg sort
of air about him, he was playing through all the mainstream
channels in terms of donated Democrats.
He also was coming up as a legitimate business person, and
there wasn't too many questions about the fact that he was going
out and bailing out these shitty crypto startups, which also, I
think helped feed into a presumption of stability on his
part. He must be part of a stable
business because he's buying out the shitty businesses.
So he must be the good business so I guess.
Yeah. Search you get some actual
question here is like, just should there have been more
questioning of just how stable he and FTX were, because I just
didn't see any of it. And that's why, you know, if
it's such a shock because if in the weeks leading up to this
announcement, you know, that this collapse there had been
whisperings in the mainstream, you know, present even just like
coin desk, which is just a week ago.
That there was a real question about how solid and And liquid
Miss business was, it would have seemed a bit more reasonable
when it happened. And instead of just felt like it
came out of nowhere and I think to some degree that is a failing
of the broader business, press that wrote so much about him and
never even raised the questions that as cryptos collapsing.
So to could this one solitary figure who is trying to position
himself somewhat apart and yet clearly is tied up in all of
the, you know, fragility on the space look.
I mean my knowledge of crypto or of the Sam Empire, but from a
business point of view was like, you know, I can write a sentence
or two, you know, in the nook. After Orion Traders, but not to
pass the buck. But like, you're totally right
Tom, that I feel like there was like, zero reporting ever to
suggest that, like, you know, I feel like, even with like other
fintech companies, like, Robin Hood, you'd occasionally.
See like this, this is not a little bias of media.
This is the first time I'm really willing to agree with
people and I feel like people are hammering.
This one, hard enough like I do think it's like he was a good
Democrat and not just that he was aligned with Democrats, but
he does the things that sort of the intelligence Gia wants like
he has sort of provocative you. And you think you think you
think that explicitly encouraged reporters not to question the
business? Yeah.
And yes, yes, I definitely. I mean the China guy the by
Nance company and fucking Brian Armstrong.
The libertarian. Lex Luthor looking guy
definitely like this is Sam bregman.
Freed was what the media class like reporters are rooting for
him to succeed just like oh just their their gut like their sense
of who's like a believable person.
Like SPF is like our type of guy.
I mean it's just the reality I am including myself in this
critique. Yeah look I didn't write shit
about him not that it was my beat but like I yes I think he
played on so many of the inherent unconscious biases,
whatever term you want to use of what we consider a legitimate
and stable business person is that people went to Stanford
they're like Professor types lawyers you know it's certainly
the effective altruism shit. All right he was a brilliant.
Formance, what would the contrast is Elizabeth Holmes?
Like there is some utility to the metaphor and total stops.
I'm not. So I want to, I want to break it
down to what extent do you think this is like, the Elizabeth home
situation? Well, a little hard to see right
now, Penny VCS, you know, that's that's why I ever investors,
were worse. I mean, let me, let's see where
the dust settles yards or trip the legal questions, right?
We're not at liking and legal accusations.
Yes, yes, you do. Two dead cat.
But yeah, I mean the homes narrative, right?
I think everyone would agree was like fraud and was a level
Beyond you know your standard deception here like could be SPF
storyline rival, that may be glowing magazine covers.
I think the reporters believed in SPF more than they believed
in Elizabeth Holmes, whereas Elizabeth Holmes did have the
sort of we're rooting for the upstart woman Dynamic.
That's Awkward talk about but is obviously true.
No it's true. I mean, Sam being a young white
dude is definitely part of this mostly being written about by
other young white dudes. I would say it's hard because
theranos was such an incredible story.
Because this was a hardware device when, which he was making
outlandish promises was was claiming Partnerships that
didn't exist. I mean, the fraud went so deep
and was so tangible. Whereas with crypto really you
know what happened here it sounds like and you tell me,
Eric bit. Like, you know, he was
incredibly over-leveraged and was taking unadvisable risks
with client money, right? Interview.
Sure. Haunted by this session.
You should never use client money.
Like, I mean, obviously, you can invest climb money in some
cases, but shifting climb money to a totally different, you
know, vehicle to make speculative risk.
I mean, that's, it's sort of far outside.
Good. What is the Eric?
What are the least incriminating version of events for Sam that
you could come up with? Like what is the argument that
Sam is? Nothing like Elizabeth Holmes.
And that this was all, you know, a misunderstanding.
I mean, I guess the least incriminating.
This is total bull shitting. Though is just that like FTX was
fucked as soon as like those earlier contagions went down and
that he basically had to do everything to get out of that or
otherwise, the customers were fucked anyway.
And so he sort of violated customer trust once it was like,
well, if you knew what was going on your, you were going to get
destroyed so who cares? And then maybe he would have
written it out if only By Nance hadn't like drawn attention to
this and leaks hadn't tried to really raise questions.
And then there was sort of a run on the bank and the run on the
bank, really did A Min. But I mean, I feel like that's
like, you could say similar things to Bernie Madoff.
It's like, I Almost Got Away With It.
Like, if you, if no one had flagged this, I would have
raised more money know what's going on.
This game works is that the problem is, when the Music Stops
and then it all kind of falls apart.
I mean, again, I think because crypto is still such an unstable
space and, you know, the air went out of that balloon with
such rapidity. Petit.
It's just hard to compare it to like the organized and
step-by-step deception, that Elizabeth Holmes had which, you
know, like there was no there there with well.
I mean there's that famous famous famous to the tech
reporter said and super insiders but interview where Matt Levine
of Bloomberg is like talking to Sam Venkman freed and like
basically Sam admits that maybe like a lot of these like,
made-up currencies or should be worth nothing and they're sort
of playing games like he almost admits that the The thing is a
farce and it's just like yeah. Matt Levine is like you sort of
admitted that this is like fake, right?
Well, why also did reporters not ask questions about FTX in the
wake of all the collapse of the crypto companies and as he was
buying up all of these shitty startups, bailing them out or
whatever doing it as like as miss a few extras.
In exchange, I think that's like Alamitos sort of like a private
like speculative investment firm.
It's like whatever who cares what Sam's doing with that, he
talks about it, It, I would hear Whispers from people, like, I
reached out to Sam one point. He didn't respond reply, but I
was like, I heard you shorted, like the stock market.
You made a ton of money, you know, there are all sorts of
rumors on just like the genius of Sam.
Bingman free day seem to have unlimited amounts of money and
so it's like, okay Alameda. That's his like private, like
investment firm. That doesn't really affect while
their investors probably. I don't even know the Dynamics
of it. It's not like public money.
The crazy thing is using like, basically bank account style
money with FTX right to Shore that up.
So it's Not the same as he's like made up currencies you know
which really felt like like tether.
It is not like tether it is different than that but had the
crypto Market not Fallen you know off a cliff in term.
Sure yeah I'll give all these currencies everything keeps
going on even fine. Yeah yeah I mean that you know
it's in the same way that you know 2008 crisis exposed.
Bernie Madoff. Was that early?
That's not like oh we only build our investment vehicle going to
work if everything continues to rise is like yeah that's that's
nice. That's every scammer and The
world. Unlike a crypto specific
question and maybe we're not qualified enough to answer it.
But, you know, problem, this is a podcast, you can say whatever
you want, we alluded to it a little bit in Eric's intro, but
you know, another key figure in this whole thing was CZ over at
biting ants, who basically said, I'm dumping all my Holdings and
ftt. And that basically kicked out,
like the rotten leg underneath FTX that caused this whole thing
to happen. And, you know, as you mentioned,
Matt Levine, I mean, he had a pretty funny and Analogy.
And one of his newsletters earlier this week or last week
or something, where he was saying, you know, during the
2008 financial crisis, if you went around, you know, if you
were like a banker, and you were saying to people, hey, I hear
Lehman, Brothers isn't doing too well.
These days, why don't you move your money over to my easier to
our bank right? That actually would be a
disastrous thing to do. Your boss should fire you
because you aren't just bringing over a new account you're
undermining you know trust making a system the entire
system and so I do wonder if you know because you know It's easy
when he when he, you know, there was a brief period where they
were going to acquire them and then they ended up not doing it.
I mean, this hurt the whole system here benefit himself.
I think there's I doing this. It's easy.
Did one sort of acquire, I had some situation but I think my by
it was too bad. Well, I'm just wondering if he
didn't realize how weak they were like.
He thought he was going to dump them.
I don't think he realized that he was going to be toppling, you
know, a headline fucking Banner company in the space?
That is like, undoubtedly going to hurt him, but I want to move.
I want to change back. Sort of teddys area of expertise
day. I mean what does this mean for
Democrats and also don't Democrats like look bad.
Like I mean I think people move on pretty fast from the donor
for a given party is evil and less.
They, it happens to be Laden with anti-Semitism but the I
don't know. Do you think it's it's damning
to the Democrats. They so readily took spfs money
when he turns out to be this sort of - figure look.
I mean like is this Harvey Weinstein?
Well, we're, you know, Democrats had to like, donate his money to
like times up. No much money to do that.
Well, I mean, the read, the reality is, I mean, the, the
money that Sam has donated has primarily been to his own Super
PAC, Sam started a group called protect our future, which spent
like 20, 30 million and related party transactions with this
guy, everything. All right.
That's not, that's not that unusual for a donor group.
But basically, like the broader context here, Sam over the last
18 months has hired a ton of fucking people.
Like, there's so many consultants who I mean, will
Macadam, the effect of altruistic altruist guy, that
guy? Yes, terrible.
I mean he is been out, the will mccaskill, it will mccaskill
last night is a signatory to this like pretty extraordinary
statement. So for folks who don't know what
Castle was on the board of the FTX future fund, which is like
Sam's primary philanthropy for Sam.
And I just say I'm actually frankly, all these other kind of
senior FTX Ex who are all aligned and there they put out
the statement last night that said like we are shocked and
appalled, effectively, you know, alleging possible deception by
FTX leadership and it was, you know, interesting because well
mccaskill is like Sam banquet, fried's Mentor.
Well, mccaskill's literally, the guy in elon's messages, trying
to pitch like Elon to take SBI a sales meeting as.
Yeah, he could give you at least five billion as much as eight
billion dollars a year long. The money's good here?
Can you guys imagine if that happened?
I don't have like Twitter later but out a bit of fun, fun.
Also represent so Sam hired, all these people and like, you know,
I talked with a lot of these people have like, you know, I
have a talk with over the last 48 hours and like everyone is in
a state of, you know, trepidation and shocked and, you
know, to the point you're making about should Democrats Return of
the money. Like, there's a feeling of
almost complicity here. Did they legitimize this person
in some untoward way? Now, what I'm about to say is
not a reference to will be, as I don't know, all these individual
actors but Sam was basically in like a cuddle puddle with some
of these people, right? Or luck coin does just had a
story that he was like on and off dating the CEO of Alameda
research that. I mean somebody use the word
which is a very San Francisco term Paulie.
Cool look just like the idea that they were all just dating
each other. And that was sort of a
complicating factor in that. They were all living in a loft
in the Bahamas, right? And just like that, they all
they do. All looked.
I have no independent reporting on me romantic relationships
here, but it is. Truly did all live together.
Talking about sex, not right? Yeah.
There was no emotion here. This is purely transactional.
They're all sucking and fucking in the Bahamas.
Well, as well. They were protecting their
Futures. Sure.
I mean, the red flags just a quickly.
We've covered a lot of them based in the Bahamas.
Relentless, multi-party, transactions, no investor board,
little investor oversight. People, use dating running
things. Friends running other things, I
mean, I did write. The one thing I will defend
myself on is I did. Really push the point that like
there was a lot of commentary that like spfs donations were
like well-intentioned Goodwill. And I mean, clearly there was a
strong incentive for him to like, stay close to.
The Democrats is like pure pure strategy but but yeah, well I
think, I think, I think you can are like, SPS people always got
pissed at the idea that what they were doing on pandemics and
a Democrat. Politics was like shoehorned
into a narrative about crypto, right?
So they were always you know like this this was a huge deal
and few guys followed like Congressional race and origin in
the spring where Sam's been like 15 million dollars and basically
help prop up this kind of like you know random candidate and
like everyone in Oregon was, you know, positioning this as why is
this, you know, Bahamas, living tax.
Avoiding crypto Billy are pushing his crypto agenda and it
wasn't really about crypto that being Said like, of course,
there are people in d.c. like Sam was doing these two things
simultaneously. Right?
As you know, pushing is pandemic preparedness.
But if you really want to script Ojeda and like, can you really
separate those two things? If you're a congress person who
is like, taking the meeting, do you really like double down on
the effective altruism True Believer thing?
I've heard people joking in the seems like very implausible but
they're like, you know, Sam basically absconded with all
this money. It's like, oh I probably was
going to make any more Our. I can donate this better than I
could do anything with it. Just like run away with like
billions to go like donate to. You know, that would be the
ultimate effective altruism cause somebody literally tweeted
like you know, if anybody has the most high torque sort of
moral intuitions around utilitarianism, like would you
push like 99 people in front of a train to save 100?
It would be SPF. So like does this guy commits,
like sort of the ultimate sort of heist to that would be the
great that would be the Best version of this story that it's
like Robin Hood, but unfortunately, I'm human like
the story of Robin Hood, not the Robin Hood trading, but he was
tasting, taking money from rich people, so we could direct it
towards, you know, I mean, look, that is very effective.
Altruism. The problem is that he brought
down the entire movement through his collapse.
So that's not what's the percentage chance on this
Theory. There is a lot of discussion.
As you guys might expect about this on the EA Forum which is
like this like very active Community Message Board sort of
for the effective altruism movement and there is A almost
defensive posture about the question of fraud right now,
like, is fraud. Okay?
Like is being debated like vigorously, like, not really.
That's, I'm Simon. No one is defending fraud.
But like, her people are voluntarily making clear that
their anti-fraud sort of see, I'm sort of EA grounds like is.
Right. I think, I think, you know,
there are, there is a theoretical argument to make
that like, definitely, you know, hey shouldn't, isn't it like,
you know, because, and, you know, utilitarianism and Andy a
Takes this to the extreme anyways.
I mean some of these you know, sort of more conservative type
principles person would be very just are like what are the hard
rules and otherwise like I'm free to do what I want.
Where is like, very much utilitarianism is all about like
let's run the calculus, anything murder could be, okay?
If like you know you're saving 10,000 people in the future or
whatever. You know this is all this really
weird games they play. And so it's funny that they
can't they don't want to defend fraud right now but it seems
inherent to the View that you you can write, how committed are
you to your beliefs here? Like, here's the ultimate test,
we have you. No position to you that your
great benefactor was in fact, allegedly engaging in deception
and fraud. And yet he was doing the most
amount of good with that fraud as possible.
So, do you defend this all Tino effective altruism or not?
You believe her and they're not, I mean, I think they should one
by one have to answer for that because if not, then they just
were never True Believers in the cause I mean, who of the great,
you know, recipients of his of his do.
Nations is suffering the most right now.
Biden had a pretty good midterm, so maybe he's doing.
Okay for the time being. But, I mean, a lot of this was,
I mean, got to talk with some people who have gotten money
from Sam over the last couple of years.
You know, the basically, there's the main group is called
guarding against pandemics, which is sort of Sam's lobbying
operation in DC and they have a ton of people who work for them
either full time or part time. And, you know, I reported the
story today, That like right now, Sam's Brothers, got Gabe
who's very intimately involved in sort of overseeing all of
Sam's. Non FTX work Gabe right now is
like kind of frantically looking for more cash for the
organization because given to him, well I mean, you know,
Gabe's argument that he's making to other people, is that this
was really his operation, Gabe's operation that Sam funded.
Obviously the Optics, you know, his last name is backman free.
And, yeah, the guy would start there.
Yeah, we're gonna be difficult to be difficult.
So, The nepotism train runs out when your brother like absconds
with the money that made it possible like, yeah, yeah, I'm
g.b.f., I'm very different. Please, please give me your
money. So there's that.
I mean, there's also kind of like a broader, like, Democrats
and progressives fundraisers were like obsessed with him.
As this, you know, like, it's some of our don't know.
This is a big, big, big scoop for run Puck internal
imaginations. But like, People want to read
about Sam, backman, Freight, like it was right, people
converted, like I got subscriber.
These people can pronounce it right by money train is running
out. Yeah, shirts.
So like, people were very, there's an obsession and, you
know, anecdotally, we talk to people about like, you know,
where the money is going to go in Democratic politics, like a
lot of people wanted to get to know this person and get
introductions to his Network partially these.
So young, right? Like, you as someone who people
thought might be, you know, a democratic power broker for
decades, obviously, So that sort of it's almost like not only
what was lost in the present, but sort of the future earnings
that are now out of the picture. If this repeater, it's heal the
media. I mean obviously we're all going
ballistic over the actual FTX story but Republicans would get
tagged with it much more than Democrats are getting.
Yeah, yeah probably media bias are we talk about Peter teal and
the election? I will say it.
We have teddy on here so I will admit to it.
I have said is that I thought Blake Masters would win.
Now I want to say as we're recording this on a We should
let the full Democratic process play out.
Not all the votes have been counted.
I want to make sure that everyone who vote in Arizona,
has a chance to have their vote counted, but it doesn't look
good for Blake Masters. He ate shit on Election night.
Can I also just say on are related to pets?
I had a bachelor party. I was pretty drunk, but I
thought I had five-to-one odds. I'm John fetterman that if
fetterman when I get $100 in to be lost, I had to pay 20, I was
like, that's an insane deal, I'll definitely take it.
And that friend, I texted him. Fetterman one and he hasn't paid
me and I think you listen to this podcast so you know who you
are. I thought that was a real bad.
I don't know that we shook our hands.
So so that friend that friend, Sam, Becky free, you're not
seeing that money. Eric that money's all gone your
money's not here. Your money's not here, it's over
there. It's the okay.
So, Peter teal, I mean, what, let's take stock a little bit of
his kind of role in the future of Republican politics, because
JD Vance did win although not maybe as impressively as people
would have thought but you know, Ohio is basically just a
straight-up Republican state now and so that really is all it
took to carry JD Vance across the line.
Blake Masters lost. I think you'll probably hear an
argument from people that had there been a better candidate
may be a candidate who had a job prior to running for office or
was it not a little book factotum guy?
Yeah, wasn't yeah. Terrifying people with his kind
of blank stares and Really creepy demeanor that probably
poster. Yeah, I do love the clip of Mark
Kelly being like you want like this guy, the kind of guy you
just like tells you he knows better than you like sort of
debate school kid, you wanted this Skyrim?
You know, I I did love just like, look at him, look at this
great guy. My closing argument is like look
at this fucking guy anyway. Yeah, so there's, you know, a
solid argument you're hearing made among Republicans that they
were just really bad candidates here and he was pushed across
the line almost entirely by Peter teal.
So what Make it visible the future.
Okay, go, go, tell me. I mean I mean I mean I think the
Peter teal narrative has been overstated.
I think a lots of ways like being Peter spent 2.5 million
dollars to boost Blake Masters in the general election that is
right in the front like Masters would not even be on the
political map if you have, who is this guy?
There is nobody like Thomas saying that.
If you pushed over a line by Peter teal, I don't like over
the line in terms of getting the nomination he didn't know they
sure do you know? In the primary, in the primary,
I would, I would, I would, I wouldn't even put them in.
This is debatable, but I would even argue that the Peter teal
money for Blake Masters, and for JD Vance was not determined
active in those races. Both of those races had had sell
funders who ended up spending a lot of money.
Like 15 million dollars is a lot but also not Blake Masters and
JD Vance don't have a lot of here.
You'll never live sure. They fucking nobody's.
I agree that they do do not win the races without Teal.
But okay. I don't know right now.
Like, what no, but seriously though because I think there was
so much written about and I the reason that I made the Blake
Masters prediction was because I first of all believe the polls
and, you know, Vibes and shit like that.
But also I just foresaw this future in which both those guys
got, you know, elected and we were going to be a wash and all
these stories of Peter teal is the, you know, financial and
ideological force behind the modern Republican party and
because things played out in kind of complicated and bad ways
for those Candidates. I think that really communicates
that narrative. So so, where are we with you?
Okay, let's me. Go JD, that's one, like let JT
Vance is a u.s. senator, Peter teal was a huge part of shit
events campaign. Like, you know, the fact that so
when Peter wins like, well, I have a big deal and when, you
know, I'm just pushing back on the idea that like, I feel like,
I feel like you guys are framing this, like, both these
candidates loss, like, here's the advance, want ya know?
David flood is u.s. and Iran six-year term, like it sucks
once. Which guy do not get?
Do we get the guy out of you know the book or what?
I can never remember that fucking books name.
Well, I bet it's fucking complicated for him now, right?
Because there were two. Right.
You're saying there were, there were two JD Vance's.
There was the one who was anti-trump, then there's the one
who is like groveling at his feet so he could get the
endorsement which he did. And that got him the nomination.
So, but now Trump is sort of a damaged figure.
So who does he who does he, you know, who does he loyal to?
And then with Blake? Yes, he probably gonna lose
though. Like, I mean like, you know, the
I guess the, what is I guess it comes to what was the goal here?
Was the goal to win the Senate seats, or was the goal to like,
establish himself as like a republic and player?
Because both of these people had no chance of being the nominee
at the very beginning of their campaigns, right?
I mean, it's still, obviously, for to I'm like, I feel like, I
feel like it's still a win for Peter.
Overall, he's the other day. Do you like, you like, it
doesn't decide whether it's a red wave or not, like, that's
way out of, like, Peter elected two, nominees one, u.s.
Senator, I think if neither of them have been the nominee, it
would this would have been a failure, but I think overall the
Peter 20. To political experiment was a
success. Yeah.
Okay, great. And Shopkin is book basically
says this is just the beginning and that seems to be what you're
saying. Well I also asked so I think
it's more, I've been more. I've been working here and I've
been working. Sure it on that on that idea.
I feel like some of Peters electoral interest in my opinion
is overstated. I think some stories make it
seem like he wants to be like a king maker and a power broker, I
do not think of this true, the things that he's success.
Us from doing our the things you want to do the things he's not
successful in doing are the things you never want to do in
the first place. So do you mean I was just being
ripped snide? I was just saying that.
Yeah, he gets to decide whether he?
Yeah, well I mean look, this is, you know, we're speculating, you
know, however, we want to at this point, but from what you're
hearing within the power Brokers in the Republican Party, are
they happy with the way things played out for as candidates
like, will they accept more advice and you know, ideological
motivation from him? I mean, there are some in the
Republican establishment in more moderate communities, right?
Who think that Peters been a force has been a force for not
for evil, but it is, it has been, it has not been a
productive player, right? You know, there was a huge story
line over the over the summer, with regards to Mitch McConnell
and Peter teal, right? Where they were upset that Peter
and their view supported these relatively right-wing candidates
in the primary who they saw as less electable in the general
election and then declined to spend money on.
On them and the general. So they sort of thought that,
you know, Peter handed them out, you know, turd sandwich and made
them, you know, spend money to get the turd sandwich.
Like they have at least something of a case with that
like Masters, I don't know. I mean, it's hard to do the
counterfactual here on like, how like Mark brnovich who is the
Arizona Ag and they Blake's main rival on the primary like how it
burn damage done against Kelly. Like who knows is teal as
connected in DeSantis world as he is and Trump World.
Peter and the Santa's have met before.
I think twice Peter's Also, let's be clear like not that
connected in Trump World. Like I think us in Silicon
Valley media, make petered out to be this like, Trump
Whisperer. He sort of had like the second
orbit of, like, Business Leaders.
This is from an and right and then supposed to be close to
bash into hot. She like tried to get them to
point all these crazy people right there.
But like, I would, I would venture to this is like in for
speculation based on some reporting Trump and Peter,
probably talk every couple months.
It's not like you can see you can see Trump in the Blake
Masters clip. Like I don't know.
Who is that documentary? Yeah yeah, we're just like, what
is Peter doing, right? Talk about beauty.
Looks up here in this way that he doesn't like relator giving
you more money. Yeah, he should be giving you
more money. That's good, that's good.
He seemed like very respectful for Trump of teal, you know, it
seemed like he understood. This was like a powerful guy.
My point is like I went, I wouldn't overstate, I wouldn't,
I would not say that Trump and teal, or close.
I guess, I guess not, true. I don't know how much you pay
attention to David Sachs. You know.
He's nice nuts. Compared to Tijuana, comes to,
you know, investing in or start donating.
Is that a reference to these weird texts to Ilan about why he
could owe you big bad girls with herself that yeah but like No.
Yes, axe is part of this whole contingent of people that are
fixated on cancel culture and woke people know.
They've been super quiet since Republicans lost.
I mean, yeah. It's been funny.
Yeah. I mean, but there's, you know, I
do think that is a contingent of right-wing, Silicon Valley
belief that, you know, the biggest threat to free speech,
and our democracy is woke people on Twitter, like announcing
their gender pronouns and you can make an argument that, that
world view is pretty handily rejected.
Yeah, well and reception literally just I wrote a column
basically saying he way over torqued around, whoa, culture.
And you sort of embarrassed and normal, people actually weren't
that upset about, right? And they were worried about
democracy. It like turns out, you know, I
don't know. It's very vindicate.
I'm I hope I do think we're going to burn.
I've been saying that I feel like cancel culture is like
burning out. So what are these woke?
People going to even have to yell about soon and like the
anti whoop people or both? I guess I'm saying that.
Yeah, the people who want to the anti woke people but they're the
people who want to talk about Right?
Woke - incessantly. So in a certain way they are the
woke people because they're obsessed with it are not going
to have much to talk about because while they can invent
things like crime and like weird Libs of tick-tock stuff.
It's just like they need the actual material at some point.
And I do think it's it's like what openness is not.
I live in Brooklyn. Like a lot of times these be I
live in Brooklyn. I don't even see it that much.
You know, I say all sorts of things.
Like I don't really understand like where the cancel culture is
anymore. I don't know if you have any
thoughts on where things are, With, you know, that's trained
up in this forward, about the, the woke backlash or you like,
what the meet you, what do you mean term?
Election means, broadly, for like political alignment and
then translate that if at all possible into what it means for
Silicon Valley and it's alive. Yeah, I mean, look the energy
and Silicon Valley is with the right, you know.
You Lawns takeover of Twitter or sort of the crystallization of
that, like vague sense of where the energy lies, right?
And quite like that I think people like David Sachs.
I don't think they're not important.
Like David Sachs is like you know, helping to her like run
Twitter day-to-day right now, right?
He doing a bang-up job. Somebody talks to Peter and
healing musk, you know, frequently about political
stuff. You know the podcast they host
is obviously popular. And look, I mean I think that
clearly he's going to have more influence going forward and you
know like I think in terms of how the mid term effects this
like you know this is not the like red wave that You know, all
the you know, conservative influencers were were desperate
for it to be lost? Well, I mean like look you know,
Republicans don't roll house and you know, it's clearly going to
be divided government which like I think Trump 2024 or will
reveal whether or not Silicon Valley, serious about this or
not is serious about this like political engagement because,
you know, the always people love to Santos was the nominee,
right? Because they can just sort of
pretend that like Trump's not a factor in the party.
But will Peter teal and David Sachs?
Be hosting like this and is 2024 events.
Like I can see it. Yeah.
Twitter boy, guys, haven't been on it for the last week or so.
Sounds like a lots going on over over at Twitter HQ.
I've been told everyone's got to go into the office but what
exactly they're going to be working on is a real question.
Look here, I guess would be my quick thing on Twitter, which is
the stories coming out. It about, you know, out of the
company right now are just incredible.
You know, the amount of just unrest and frustration, and fear
and anger, that employees are expressing to Great reporters
like Casey Newton and Zoe over a platformer and, you know,
reports it in Cider. And the information and whatever
clearly are showing that, there is a ton of people that are
super fucking pissed off at how Elon is running things.
I do have a tendency to think that whenever the media
coalesces around a narrative. So strongly that we may be
missing something and is very possible that there is a whole
other side of things going on inside sweater.
And because Elon give zero shits about PR and it, you know, a
normally, if you want has an incentive to make it seem bad
right now, like, any good narrative, story teller, Was
make it seem. He's saying we might go bankrupt
you know like the media just takes that face value.
There's very little like he's not a total idiot.
Like why is he deciding to say that it might go bankrupt and I
do think there's an argument that it's like tank expectations
and then and then go from there. Yeah, the only thing, the only
two reasons that make me a little bit, skeptical about that
narrative and then I'll push to you guys is like one that
actually really does damage your relationship with advertisers.
The the worst things look will cause Cause them to want to pull
their money. So it is kind of like a
self-fulfilling prophecy. And I mean Eli, may just not
know that because he doesn't know shit about advertising.
So that's, you know, he could end up, you know, in trying to
create the sense of urgency actually create real urgency.
And the other thing is that if you fucking read the text
messages on Ilan, it really seems that they just have no
clue what they're doing. They went into this thing with
no real ideas. It just was like snowballed and
and got out of control and this does kind of seem like the old
so they're not seemingly smarter than you think.
Yeah. Yes.
Oh shit. So you know, I want to leave
open the possibility. This place won't burn down to
the ground in a couple of weeks. But man if you read the stories
it seems like it will. I don't know.
What do you guys think? I'm trying.
I'm trying to spend I don't know.
We can I divulge we've moved our group TM off of off of Twitter
to Signal. Yeah yeah that huge blow right?
Proprietary scoop must credit dead cat podcast.
Yeah. No I'm I mean, I'm definitely
concerned about just as a user, you know, he spends too much
time on it, like I'm finding it much, much, much less useful
than it's ever been. The problem is greeting every
other second, so, maybe that's it.
I say, I say, as I've literally on Twitter right now running at
we try to do, I want Erica table.
Let me off their show, send it anyway.
It's not useful anymore, but it's also so become so Central.
And it wired in our brains it's a huge part of my brain.
Yeah. Did you want that to be the
case? Eric?
Or is that just like just my my it's I've said this before, but
it is literally where the universe exists to me like that.
More than the real world is like, what is happening in the
world. Like it's hard to understate
that I have gone on what I mean. After college, I hiked the
Appalachian Trail for a month and that was like half of the
motivation for that was like a digital detox and your brain is
like totally different. After that.
And I really need to do a lot more work and I'm trying to get
better of like, really not looking in my phone for hours on
end. But I am, my brain is like
trained to just like wake up and look at Twitter notifications,
it's dark. Yeah, yeah.
But we all need to rethink our relationships with and this
isn't the disease and this is a good opportunity to do it,
right? I mean this is like a forcing
function. Well, Tom and I were always I
can't speak for you but we're always deleting apps from our
photo. I mean Tom, you deleted Twitter
on your phone right? It's been off for a while but I
would just Do it through the browser so that didn't really
work at all. Like that's what a real junkie
tidally Tick-Tock, you know, every other day.
And then I'm like, I'm more like whatever.
Yeah. Now look, I've been off Twitter
for it's been a week now. I will say that during the
midterms it was a little sad, not being on there because it is
sometimes useful to see you know the updates.
Like there were people that published really valuable shit.
Only on Twitter, you know, people like what's-his-name from
the cook political report and wasn't a Dave Wasserman.
Like if you really want like that, you know, the inch by inch
progression of stuff like Twitter is useful for that
important people will make a call.
But on the flip side, like I felt like with the elections, I
went to bed, woke up in the New York Times was like the same
like nothing happened, like well-known.
Imagine, if you were just sitting on Twitter for like
hours all night, it's like nothing happened all night.
Like you would have just been sitting there like with these
dribs and drabs. Like totally made-up
developments. Yeah.
So I guess we can end this by saying there is a life outside
of Twitter. I've done it for the last week.
I can't say it's like mountains. You're off your off.
I'm off badly. Yeah.
I'll probably be back in a month or so I can't I wouldn't deprive
the problematic. When would this like a problem
is that it's like basically become my entire writing news
consumption. You know like engine like I
don't like I would venture to say that 90% of the news stories
I read are things from Twitter. Like I never go to like
newyorktimes.com. So I feel like I feel like if I
got off Twitter tomorrow I would miss things.
Oh yeah. And I would meet I would need to
find some other way to Get that information, maybe, maybe maybe
I could build healthier ways to get that information like
through the hilariously or something.
Hilariously to bring this whole podcast.
Full circle a couple of days ago, Katie sent a DM to Eric.
And I and idea I'm like a, like a message to Eric and I and she
was like, wait. So is FTX like dead or something
and I was like, no I think there's just some weird fight
between s BF + CZ. I don't think there's anything
more to it than that and that was literally like the you know,
the company was shutting down. So so yeah, you do miss things
when you're not when you're not hooked into the feet and the
you're saying the point of that. Is that you weren't on
Twitter's? You had no idea.
Yeah, it was like you at her and I'm like, what are you talking?
Yeah. What the fuck is wrong with you?
And I just like, hadn't like updated technium that recently.
So yeah, you do miss things. The other, you know, the side
pointed that is like, well, what do you really miss?
If it takes you an extra hour to get some news and we're not
regular like because I mean part one of the answers to how people
could Escape Twitter is like with newsletters that sort of
round up like what the conversation is at any given
moment. And so while that's good advice
for other people at least for myself, you know, I would I'd be
writing the newsletter. So I need to sort of experience
Witter for other people. Now, if you're like a, I think
if you're doing more step back pieces, investigative pieces
magazine pieces, maybe don't feel that way.
And and so more reporters could Escape Twitter pay for Teddy.
Hey for Eric pay for Insider. That's all you need.
Get off Twitter. Web does nothing.
There it is. That's my closing statement.
Alright, thanks so much for coming back on.
What have you? Got your third or second?
It's fine. Yeah, it's just her fourth.
Now it's your third eye. Thank you.
Get your 3 star. What?
Erina, what? Saranac 3, yeah, well Karen
Griffith, keep at it, keep it in trying to make it spicy for your
that's what we need. Like if you want this to be like
you know Sports podcast need to have some more beefs.
All right thanks hon. Thanks
goodbye. Bye good, bye good.
Bye good. Bye good.
Bye. Bye good, bye good.
Bye good. Bye good.
Bye.