Labour, Engineering, Social Media, GrokBots, Cybercabs: 7 Predictions for How AI Changes the World

0:00 Well, our engineers stopped coding around a year ago. What they have is hundreds of AI engineers and that is how we can achieve what we are achieving at scale. How much do you spend on cru a month? >> in the hot seats today we have Mateo Frances Cetty. What a fantastic surname. The joys of doing a second show with someone is you get to ask questions that no one else can answer. That's what happened today. We have a totally off-the- cuff, very unfiltered discussion with probably one of the most impressive founders in hardware, having scaled the business to multi-billion dollar valuations, singledigit churn rates, incredible global businesses, now open even in China. This is one of the most unfiltered versions of Matteo and Eight Sleep that you have seen yet.

0:41 >> Great brand with a shitty product goes nowhere. I'm extremely demanding. I'm a weirdo and so I can be a husband on one side, but business-wise, no mercy. Sometimes people say, "Oh, I'm at the final stage with entropic and eight sleep." And to me, that is a really bad red flag. There is no way that these two jobs are any way similar. Our revenue per employees is way higher than Apple. Kids that are being born now will never work.

1:04 At least for money. Ready? Matteo, it is so good to have you in the hot seat, dude. You know, last time we did this show and you had like a hiring playbook and I remember it went like insanely viral afterwards and so many people talked to me about that ever since we did it. So, I'm really excited for this as a second discussion. Thank you for doing it, dude. >> Yeah, thank you for having me. I think that hiring today is is harder than it's ever been just because of the the prizes on offer at OpenAI Anthropic and some of the other places. even the shiny new hot startups. how do you think about that? Am I wrong? Has it changed in terms of talent competitiveness?

1:52 >> We are back to 2021. and that I think is becoming a problem in the US meaning salaries are going out of control. competition. What makes you say that like engineer salaries >> any salary even for product managers are out of control right now they get insane offers from any company there is a lot of money going around and so we are focused more and more in u on hiring in Europe and and outside the US because the other problem is not even the salary and is not even attracting them on T0 but is retention because Then they keep receiving offers. If you are a cool company with a cool brand, then they keep receiving offers over and over at a higher valuation. I mean a a higher salary.

2:41 >> Have you lost people to open AI and Anthropic? You I'm invested in many companies and they're just like, "God, we're getting eaten alive by OpenAI, Anthropic, Cognition, you name these hot companies." >> Yeah. a couple the other ones are could be AI companies that are doing extremely well or they just raise money and so it's it's normal competition but sometimes the delta in salary and in comp is so big that at that point there is nothing you can do.

3:10 >> We mentioned cognition a couple of times we were talking earlier about your angel investing as well. Can I ask you how has being an angel investor changed how you think about operating? is a gamecher for me and and I think that is something is not shared enough particularly on on X the amount of learnings that you get from being an investor is insane because it's essentially you build your own intelligence as you receive investor updates you understand how the market is moving what are the valuation what are the multiples what kind of profiles they're hiring what channels might be working and I received this from companies that are not competitive with with a sleep but as a founder you just get a sense of the market and I find that super valuable.

3:51 >> What's been the biggest lesson from angel investing? >> The biggest learnings is always on fundraising, right? You see how much they're raising at what valuation, what multiples of what investors that that's one. The other biggest lesson is for other companies that are still consumer to see channels, what channels work for them. What do investors not understand about hardware that they should? You're advising me. I'm your buddy. I have a fund and I I want to invest in hardware.

4:19 What are you like dude before you do it you should know this >> that probably the founders in the first year of the company or in the first probably let's say three months they don't fully understand what the cost of producing that device will be they don't understand the return rate and so everything they tell you about bomb and cogs will probably be off by at least 50%. >> Does CAC do go down over time? >> It really depends. and so that is another thing you want to assess which is word of mouth. In our case, word of mouth keeps compounding. We are around 40% of our revenue even at our size which start being really big is 40%.

4:58 >> 40% of your revenue says word of mouth. >> Y >> what's your second biggest channel? >> then you start getting into paid media. >> Yeah. And that's just Meta. >> Yeah. Is then it becomes Meta, Google, Tik Tok and and all those channels. >> Can I ask how do they compare? I'm I'm a content spe hopefully specialist at this point. no one that I speak to has managed to make Tik Tok work. Have you? >> We did actually this year in the past six months.

5:25 >> How >> it's usually a matter of amount of content that you can generate with u Tik Tok influencers. >> So it's about getting a UGC program in place. >> Yep. >> Is there a big budget for you tied to it? The way we usually approach these channels is we start unlocking a small budget per week. We start looking at the CAC. We set a cap to the CAC and then they can deploy as much as they can within that cap. But then as they prove it, they can deploy more more money. So to me, they could deploy $und00 million if they're within CAC the the cap of the CAC. The important thing you need to do regularly, probably every six months, is an incrementality test.

6:10 And so we can we might turn off Tik Tok in certain states in the US or in certain geos. And we start AB testing what is the growth rate or is the revenue rate. So we want to see how much each channel is incremental because we don't look at the CAC from the platform. We have our own models now that determine the CAC of each channel. >> Sorry, can you tell me about that? You have your own models to determine the CA from each channel. Why is that?

6:40 >> Well, because you cannot trust there will be the there will be a a an excess of attribution from the same platform. We do the same with with meta. If you look at the the kakon meta is probably 20% lower than what the true kak is. And the only way you can do it is by doing these incrementality tests. And so let's say you you pick two geos that they deliver they perform similarly. Let's say you pick Texas and I don't know California. That is not the right example. But >> dude, you're speaking to a Brit. That'll totally work for this examp. And so then you turn off Texas and you start seeing what is the delta in in performance of that of that state versus the other. So how much revenue you lose. So if one was if they were both growing 50% year over year and you start turning off meta in one or the other you can immediately calculate the value of meta for that state.

7:34 >> Does every brand need to have their own models to accurately >> Oh 100% because otherwise they just fool themselves. >> When did you start? Because it's one of those ones which you can't do from day one. Yeah. And and you will screw up multiple times and the point is you need to keep doing it because the as you add more channels the incrementality of each channel will not be the same. >> How did you think about that channel addition? Because I see so many founders try and be everywhere to everyone >> and how do you think about >> I disagree with that. So you need to go one channel at a time. I was even talking to a common friend recently who was asking me about that and say okay can I go in all these channels how much money should I put should I start putting 100k in each of them and I say no no no you go one by one you start with meta is probably the biggest and the one that you should prove the no the the fastest and you start with based on the size of the company a certain amount per week you set a cap to the calc you want to to to achieve and then From there you start scaling only if you are within kak because otherwise you start throwing money out of the window. Your growth people they will always want to grow faster and so they will always want to spend more and then you start losing control and what happens then let's say by the end of the year you realize you screw up and so you start pulling back and then the following year you're not growing year over year because you're spending less and so you need to be disciplined now if you want to be successful next year and keep growing year over year. It's really interesting about how you kind of gamify growth numbers cuz you're right, you spend, you get 400% growth, you pull back hard and you get 70%. Good luck fundraising when you're going from 400 to 70.

9:18 >> We could be growing 50% more if we wanted year over year this year just by spending more. But then next year you're in trouble because your C is upside down. >> Do we care about economics from day one? You said there about start with matter. Do we care about economics from day one in terms of optimization or actually is it like hey customers are engaging they're liking product if we're doing a onetoone you know for every dollar we spend we're getting a dollar back great or should we be looking for optimal returns early >> well in our case we look at the immediate payback period this is actually something where Keith was really pushy and he was correct since day one so he wanted us to have an immediate payback period And then we have what we call contribution margin.

10:02 So is what is the margin on day zero. Then we have a subscription and the subscription will compound on top of that. But we want to have that contribution profit on day one to be really healthy. If we were compressing that, we could be growing 50% more. But then the business wouldn't be public ready or as healthy as it is today. >> What would you most like to do if economics were not a part of your business? It could be like massively increase the quality of a certain point.

10:32 It could be poor fuel on the fire on metal like never before. Take economics aside. Well, you could reduce prices and I think we will see an acceleration or you could just deploy probably more into marketing which is probably what I would prefer. I'm never a fan of compressing prices. You know what Andre says that if you have a great product, people will pay for it. But at our stage as a company even if we start fairly large brand awareness is still probably the biggest bottleneck. You have a subscription business as well which obviously really pro provides a lot of juice to your margins >> because you have an upfront cost in the thousands. It's it's a relatively expensive product for a lot of people.

11:16 >> do you just inherently have very low churn rates on your subscription product because you have the buy in of multiple thousands invested up front? >> Yeah, it's world class. Our our churn is the lowest of any company you can think of. >> What is the churn? >> is in the single digit low singledigit yearly churn. Even if you compare to other companies that in the wearable space that are going public, we are better than them.

11:44 >> Who could that be? >> Who could that be? >> I don't I don't know, dude. That that's absolutely hilarious. >> but it's world class. It's is like unseen. >> Going back to the channels, and I'm sorry for focusing on channels. I I just I'm a real nerd about channels. Has your Google spend changed in the wake of bluntly AI and AIdriven search impacting so much? >> Yes. And so we introduce a new channel that now we monitor that is literally what we call AI SEO. and now in in the report that I receive weekly, twice a week, there is also AI SEO. And so we see how we rank in in AI searches.

12:23 What percent of traffic today broadstrokes is from AI searches? >> I don't have a number for that. I I I I can check but it keeps growing. >> But is it like 1% or like 20%. >> Probably somewhere in the middle. But then we start seeing an impact on Google. >> Google is behaving differently because of AI searches. >> What was your biggest channel mistake? where did you spend money that you shouldn't have done and you're like I learned a lot of lessons from this >> out of home and everything depends on the on the scale of the business in that country so we try to to do a campaign an out of home campaign in the Middle East but we we're not ready yet so if we were doing an out of home campaign in New York where we are decently known it would perform very differently that the same campaign in the the least where we just launched a year ago. And so those are the things I'm learning that I didn't know.

13:27 >> When do when are you big enough to do out of home? Because I think one thing that we've seen in the last, you know, two years, so to speak, is tech companies realizing the importance of brand marketing out of home, football shirt sponsorships, you name it. And it supposedly performing well. How big do you have to be to do out of home? I don't think there is a hard number, but you want to be a brand that is decently well known. And so I make it up. If 100 people see that ad on the street, I know 5% of them knows the brand. And so that is one of the other things that we monitor that is this aided and unaded brand awareness to understand how many people know the brand and if they know the brand, they know what the brand does. How much did you spend on out of home?

14:16 >> nothing now. But we created a truck now that goes around Silicon Valley and so you can book the truck and it comes to your home and you can try the product live. So this track has a bedroom built in in in the back of the truck. But now the truck also goes to specific events or to specific areas during the weekend where there are many people. And we are seeing pretty good success because there are a lot of people that wanted to try our product but they couldn't and now when they see the track they just get into the track and try the product and bite.

14:51 >> That's a phenomenal channel and it doesn't and you're going to have like high conversion rate on there. >> Yeah, it's doing pretty well. >> That's fascinating. I I'm I'm also really impressed that Tik Tok works for you cuz Tik Tok is freaking hard. >> Yeah, it was not working in the past. Then we kept iterating u and it just started working 6 months ago. >> How big is the marketing budget today? >> In the hundreds of millions.

15:17 >> In the hundreds of millions. >> But the story I can tell you is for example before we had an email marketing team. Now we have zero. everything is done through AI and email marketing makes no a very large amount for us. and everything is run by I >> how >> so what happened is we were we were forced to that meaning the person leading we had a team of two then the person leading the team was leaving and at that point my co-founder Alexandra jump in and said okay let me see how I can use AI to really no make this work and within 3 days she was able to build multiple bots that now run all our email marketing and so now we have a team of zero and email marketing makes close to 100 million >> and when I I just want to understand because we have an email newsletter and there's people that do it and it's still pretty average I think when you say bots what you build your own >> so for us is obviously there is a calendar of what emails needs to be built and created and sent this is based also on history so we have historical data and our AI suggests okay when to send what email with >> and when you say your AI it's like your models it's using it's using >> we probably I mean we should check but I would imagine we are using cloud for that and then internally we have probably by now hundreds if not thousands of agents that we use internally at sleep so now we I started measuring what I call the human employees but then there also the AI employees and probably the AI employees are I mean without probably we are probably 3 4x bigger if you start including all our AI employees >> where is it most significantly impacting the company >> growth because email is like that now also all our digital marketing our team received a report every morning from our AI agents suggesting what changes to do or not to do and they approve move or reject. And so also our marketing business is run our growth is run by a few people right now.

17:40 >> I worry that in a world of infinite content supply discovery becomes impossible and we just get flooded. Do you worry about that too? >> Definitely. but at the same time I think that the personal agents will look for the best product and so if you are the best product you will still win. So yeah will be probably no for for humans right the amount of content will be too much and so we will need to think about how we show up to humans where humans go that is how I think but then you need a different strategy for the agents to make sure that their agents find you and recommend you >> we said there about kind of the amount of agents that you have engineering is one where consistently across the board everyone's engineering teams are being changed unbelievably How is AI changing your engineering team at sleep? What are you using? What are you not using? How do you think about that?

18:35 >> Yeah, well, our engineers stopped coding around a year ago. So since then they they didn't code. what they have is hundreds of AI engineers that they code for them and that is how we can achieve what we are achieving at scale in 35 countries including China including Middle East including Europe where there are a lot of regulations in all of them with a fairly tiny team >> what tooling do you use >> mainly claude >> mainly claude yeah >> how much do you spend on claude a month >> give or take >> I don't it keeps growing so fast that I don't I I don't know >> like 5 million No, it's lower than that, but it's is is still in the millions.

19:17 >> And the thing I'm trying to understand is Mark Benny off said that they spend 300 million a year on Claude and they have a 6 billion budget for engineering. It's 5% of engineering salary is being spent on Claude in particular. And my question as an investor is will it stay at 5%. In which case, yeah, we can justify the $2 trillion IPO, but it doesn't have massive expansion from there. Is it a case of the 5% is just the start baby we're going to go to 25% in which case material let's load up on anthropics IPO or is it the case that actually we're going to see the commoditization by open models most of workflows are going to get taken by them and that 5% could go down to 1% as we see efficiency >> yeah I think there will be two vectors in the opposite direction the usage will increase and so the 5% will become 50% but the cost will go down and so net that I think it will go down. I was listening to an interview to Sam Alman recently and he was saying that in the early days to pay for 1 hour of electricity at night you had to work 5 hours just to give you a sense of how expensive electricity was in the early days and now nobody cares about I don't even know what's the cost of electricity at night know in Miami where I live and so I think the same thing will happen.

20:34 >> Do you find it a bit scary that intelligence is now free and like entirely distributed? Yeah, >> it it's something I I like I think about about all that, right? And how businesses will change, how our business will change once that intelligency is semi unlimited. I asked the instinct this morning is to do an in-depth analysis of three of our biggest competitors, Instagram channels, cuz I want Instagram to be a real driver for us moving forwards. what works, what doesn't, what themes work, what hooks work, what layouts work, what doesn't, what captions work. It was incredible.

21:07 and I said, "Can you suggest three stories every single day for me at 8 a.m. to do?" First one starts tomorrow. >> Yeah. I mean, the amount of productivity will explode. It's probably like when we went from no computers to computers, but or probably even bigger industrial revolution or agricultural revolution. I we are facing one of those moments. >> Knowing what you know now as a consumer and customer of Claude, would you buy anthropic at the IPO?

21:33 >> I would probably buy. >> Yeah. I still think there is so up so so much upside in all these companies. I'm really bullish on SpaceX personally. >> why what drives that? >> Well, I think so here is another theory that I have and this is just my opinion but I think with AI companies will the right companies will transform themselves in holdings. And so what it means is that whatever is sleep is doing today will be one of the businesses that we do but we AI as we build tools for ourselves we will discover other opportunities business opportunities and so the eight inc will probably own three four five 10 different businesses which if you think and if you look at comp Chinese companies it's something they have been doing forever if you look at Xiaomi Xiaomi does 15 different things I just watched their latest presentation from their CMO. I look at a lot of Chinese companies because they are geniuses, right? They never stop themselves. So Xiaomi instead of being just like Apple, they also do cars for example, right? They do so many other things >> and fridges and ovens and >> literally anything hardware related, anything that is smart home. But then they also get into components like some of the components like BYD develops certain components well outside the the car and automotive. So these companies have already proven that the concept of focus is not oh you keep doing the same thing forever. It's just I have certain capabilities then how can I use these knowledge and capabilities in any form and with the I we will all do that. I'm loving this conversation and the joys of like doing second shows is like they're much more casual which is much better to listen to and also much more fun to do.

23:24 Do you worry when you see the excellence of these Chinese manufacturers in spec specifically the kind of automotive industry that it's just going to hollow out the European car market? Yeah, I think Chinese they really nailed particularly automotive. and based on my understanding what what happened is around 10 years ago or whenever exactly that was they understood that they they didn't want to compete with European manufacturers on standard engines and that is when they decided to double down on electrical technology and since then they started developing their cars but I I go to China often for for work now we sell in China but we also manufacture in China and when you see the quality of their cars because in the past we used to think that some of these products were just know cheap and and ugly. Well, instead now they design cars. Sayi, if you go to their stores, it looks like an Apple store, but there are cars. There are no other devices for the home. These cars, they literally look like a Ferrari aesthetics or they have these seats that turn so you can just sit and then >> Dude, I've seen I've seen the Tik Toks.

24:37 They look so cool. Incredible. screens come down, screens come down on the ceiling, >> massage, everything is voice control. So, they're really focused on the customer experience and is incredible. And I think a lot of other manufacturers around the world, they don't they don't focus enough on the user experience. I completely get you and agree with that. >> But as your wonderful accent denotes, you are Italian. >> Yeah. and a huge amount of the European industrial economy is is rotating centered around cars.

25:09 >> Do you worry about that? >> Well, I worry even more about another factor. I think all the Chinese manufacturers, they will become robotic companies. I think all these automakers should transform themselves and start building humanoids because the humanoid will be what cars were in the 60s. If they don't do that, they will not lose only cars. They will lose also the humanoid market which is trillions of dollars. >> Are you seeing the advancement with humanoids in China in a way that you really didn't expect?

25:40 >> Yes. I don't know if you saw the I don't know what was the formal name the Olympics of robots. >> The humanoid games I think. >> Yeah. It's insane. And the way I look at that is okay you look at this thing it looks a bit funny they look a bit clunky but they start doing these things knowing how fast AI is moving. If you next year those same games will be mind-blowing. That is what worries me.

26:07 What I saw today right if you're just if you just look at that you say oh look at this thing like these robots know they are not really good at walking even if they did the records in the 100 meters. There was a robot that run faster than Usain Bolt. So they know how to >> There was I I did a video on this. There was a robot that beat the high jump. Yes, I saw that. And then there were the fighting and know the the fighters >> but tennis like real time.

26:35 >> The tennis was really cool. >> It's insane. >> Yeah. But in one year from now, we will be blown away at this at this speed of AI. >> Did you see the paper last night or essay or post last night from someone at OpenAI? Sam promoted it that basically said we actually need to put a slight pause on this. It is getting too far too fast. >> Yeah. So there is the I think the part that is worrying everybody is the the part of self self-learning from these models and so they are getting to the point where they train themselves and that is when we start losing control.

27:13 There is a point even in our >> you think we're already there. I think we are then I think there is a big delta between what we see as users and probably what know the frontier model companies have in house and I think they have already seen it behind the scene. you you have seen some of these things that are happening already in terms of cyber security in these know civilizations that there were three attempts of civilization I think in an open AI model where agents were building their own their own group >> I'm going to go there you sell in China you you spent a lot of time in China a lot of your investors including Keith Roy who's a friend of mine hates China.

28:03 How do you reflect on that? Is it as evil and CCPdriven as it seems? Are we in a dellobalized world that should hate China? How do you think about that? >> Yeah. I don't I don't have a specific opinion on on on on that, so I cannot really comment. I I can just tell you for us is a is a key market is a big opportunity and we decided to sell there and and it's doing really well for us.

28:31 >> Is it very different selling in China? >> Yes, because you cannot sell on asleep.com like literally you don't sell on a website. They don't use website and so for us was literally learning everything from scratch. >> What do you mean they don't sell on a website? >> Chinese don't buy on websites. There is no e-commerce as we know it. They only buy on their super apps. So on WeChat, Rednote and equivalent. And so we had to learn all that.

28:59 >> What the So where do they land? Like you send a referral link to your friend. Where's the referral link from? I'm confused. >> Imagine that everything the equivalent oversimplified is like if you were buying everything on WhatsApp. They don't go on it on any website. website are at the most just literally like if you just want to scroll and see some some picture and read a bit more about the product but all the purchases all their credit cards are on Red Note or kind of Amazon equivalent and WhatsApp equivalent or Tik Tok obviously. Does that impact how you think about how we should think about security for these AI assistants?

29:38 Like everyone now is like oh never put my credit card in instinct or what if it gets hacked. Yeah, >> I think the solution for that to me is so for example, my Grockbot is buying things for me already, but is using Amazon on the browser and so Amazon has my credit card and so there I feel confident because I'm not sharing my credit card with AI yet. I I think in AI we are where we were with credit cards on know when spending and buying things on the internet 20 years ago where people particularly European and Italian I was still living in Italy they literally didn't want to put their credit card on the on on any website because they thought it was a scam and sometimes there was a scam back then I think we are at the same point with giving our credit card or information to these bots. It's still a bit know sometimes you feel uncomfortable but I think in a year or two from now our bots particularly bots from frontier models like from X open AI and claude you will start trusting them soon.

30:44 >> What seems crazy today that you think will be very common in 5 years? I totally remember I wasn't allowed eBay when I was young cuz my parents were like no way are you putting credit card details online. I remember when it was like, "You think you're going to find a partner online? These apps are ridiculous." >> Now 60% of relationships start online and I think we live online transaction wise. What? >> Probably your bot buying a cyber cab that will start making money for you. So you will buy a cyber cab that makes money for you with a bot and the bot runs the cyber cab.

31:22 >> That would be pretty sick. I mean it's not that far off happening now. >> No. And then it will be the health part. That is another area where I I think I hope that cancer can be solved within 10 years. I think companies like eight sleep will be able to save your life save the life of millions of people. >> Does the sleep product actually change that much with the greatest respect in a in a completely AIdriven world?

31:49 >> 100%. we start seeing the likelihood you develop diabetes in our data hypertension. We are becoming a medical device for sleep apnea. So your bed will become the most advanced medical platform you ever had. You said about retail earlier. I bet retail has been a question for you for years and I bet there's been different board conversations had. How do you think about when's the right time because you're still not still DTOC? >> Mhm. How do you think about when's the right time?

32:19 >> Yeah. Well, let me step back for a second. One thing I'm learning as a as an entrepreneur is there is a time for things, right? Similar to what I was telling you about the autoform campaign. Nailing the timing of what you do. So, when you do what is actually really important for CEOs because it's not that it's binary that I don't know retail doesn't work or out of home doesn't work. No, it works. But there are some second or lower level conditions that are required to make that project work. And so I think for eight sleep that is happening now. And so you should imagine retail to become a meaningful part of our channels in in the next u month years.

33:07 But before it would have been too early. Same for China right launching in China. One thing I I spoke to a lot of Chinese founders and what they told me is sometimes when they start their consumer products, they actually start selling outside China first and I say why you have such a big market and you know the market and they say because the the Chinese market they love to buy products that are already well recognized in the western world and so you want to build the product and the brand first in the rest of the world and then you come back to China. Otherwise in China you would be one of many knockoffs and it would just be a price war and so I didn't know we just decided to launch China and so we were just doing it but I didn't understand that for us was the right time to get into China because now we're already selling in 35 countries we are well recognized we sponsor Charles L clerk and know work with Ferrari through chars that is a very well recognized brand many athletes use us Elon spoke about us Mark Thuckenber spoke about us. Elon is really big in China, right? And so you have a level of trust where you command a certain price. But if we were doing the same thing five years ago, we would be destroyed by a knockoff that is 500 bucks cheaper. I was had Hugo Bar on the show who was a former exact from Xiaomi and he taught me something very important in harbor and I'm intrigued if you agree with it. He said you need to be one of two things. You either need to be price king, which is I'm the cheapest, or feature king, which is I'm the best.

34:40 >> Yeah. >> Do you agree with that? >> So, I agree and disagree. I agree that you can be the best price, it's not what we want to be, or I would call it the best product and brand, not that so much about features, but the brand is really important. And so being a brand that is associated with again the Charles L clerk with Elon Musk people they really respect they want that. and the same happens in Europe right I grew up and I remember when I bought my iPod with it was impossible and I was buying a secondhand iPod on eBay back then but because Americans were having this product and it was not being sold in Europe yet. There is that that kind of form. I completely agree. Listen to a thousand songs in your pocket. Yes. In a beautiful poster, >> dude. Samsung and all the others did a thousand songs in your funky device, too. It was the same in many ways.

35:37 >> 100% the same. And Steve Jobs has always been a genius because he was coming with a great product after everybody else. Sometimes one, two, three years later, but he was nailing the branding, the packaging, and the the peach and everybody and after the look and everybody wanted it. What do you think people don't consider about consumer brand enough? >> The brand particularly I think in Silicon Valley I think in Silicon Valley we understand really well building the best product but I think we underestimate the importance of brand then a great brand with a shitty product goes nowhere. So first is product but then you need to be able to build a brand that is aspirational and can command a certain price. Charles L.

36:21 Clerk is a phenomenal talent for those that don't know in the racing world, one of the best. How does that come to be? You get a DM from Charles saying, "I love eight, sleep, draw you want to sponsor me." How does that come to be? >> Yeah. Well, it's pretty incredible the story. So, we got connected. So, Charles already had our product for two years before we met and we didn't even know. and that is the best way obviously for us to start the relationship. Then I'm an F1 and motorsport obsessed fan, like obsessed. I I know everything since when kids racing go-karts. So I knew about Charles six, seven years before he got into F1. And three years before F1, he was racing two years before he was racing in F2. And at the time I reach out to his team in F2 and I say, I'm a huge Charles fan. I think he will make it big. Is there any way where a sleep can sponsor him? But at the time asleep was very tiny and so we couldn't find any real deal. But when I met Charles, I still had the email where I was not going back and forth with his team and I wanted to sponsor him before he even made it to F1, not to Ferrari, before F1. And then I share with him our vision, our medical vision.

37:39 He really cares about that and he's actually really into AI. He's incredible. super sharp guy, super into AI. And we had dinner together. I think it was the Wednesday of the GP in Miami. And before the end of the dinner, we said we're going to do we're going to work together. And the deal since then was done in in a matter of days. >> Can I ask how much did it cost? >> no. I I I'll share. What I can tell you is that Charles invested in eight sleep and u and I I was honestly first really happy because he was one of my my my heroes but second I think that proves what I was telling you how how smart he is also as an entrepreneur and and a businessman.

38:27 >> Can I ask you I think a lot more celebrities and athletes are obviously trying to be investors and wanting to invest today than ever before. What would be your biggest advice to other founders on how to get them and how to get the most out of them as an in as a founder of a company? >> Well, we made a lot of mistakes into in that too and now it's probably four or five years that we invest in sport because obviously we have charge but we were sponsoring the UAE team with Pagatcha. Pagatcha was installing our product every single night at each hotel of each stage of the tours the France since last year. We didn't even know he won last year and then he won this year.

39:11 So they reach out after the first year and say look Pagacher did everything on his own. We bought the product now everybody in the team wants it. Can we do something together? So we sponsor the UAE team this year. And then we are in Paddle with Arturo Co and Fedrico Chingato. number one and number three in the world. We are in tennis where we sponsor a lot of coaches including the coach of Sabalinka and many others and then there are a lot of top top athletes that use our product. It's not public and because >> but what would you advise founders on lessons from how to get great talent and then it can be celebrity ambassadors too, pop stars, DJs, you name it and how to get the most out of them or do they just not add value?

39:50 >> Well, there are two conditions for any deal. Now, first they need to be to use the product. If they already use it, they bought it on their own, perfect. Now we can talk about not doing a deal. If not, they need to try it and then we want to hear the feedback. They need to know the product. Otherwise, it's just a a pure business transaction. I don't like it. Second, I want to have a direct relationship with them. Usually, sometimes managers, they don't want that and they want to try to be in the middle. But if I don't have the direct relationship with the athlete, we're not going to do the deal because then it's just a a a financial deal. And at this point, we don't care. I want to be connected to the athlete. I want to know that they love our product. And if they don't, it's fine. But then the relationship will never work.

40:33 Particularly in a product like ours where these people the biggest value they do is just by talking to their friends about how good our product is, right? And so they really need to be bought in. If they just have a stake in our company because they put a few million dollars, you don't go anywhere. >> Who would you most like to have on the cap table who you don't have? Probably. >> Do you have Cristiano Ronaldo?

40:58 >> No. >> He would be amazing. >> Yeah. >> Like he Have you seen pictures of him training? Like, dude, I'm I'm a straight man. >> My god, this guy's body is incredible. I looked at it and then I looked at myself and it just felt like, >> oh dear. >> I think for us there is a big difference between the athletes that we can disclose, right, and the athletes that use the product. some of the top top tennis players they they ping us and in all the grand slam they sleep on our product in F1 we have probably 80% of Formula 1 drivers sleeping on the product including the the people that are winning but we are not allowed to share that right is a is a private confidential relationship >> do you have any wild stories of like delivering it somewhere crazy for someone last minute cuz they need it before >> you don't need to say the person >> yeah I'm not sure the name but there is this really really famous football player and so he tries the product at a friend's house and then his team reaches out and say this no the athlete wants the the product can you install it for him can you come and let him try it at home so the team goes but once they get there he has this very unique specials size 300k mattress and our product doesn't fit because we have I don't the queen, the king, not the standard sizes, but this was unique and customized. And so the team is leaving, but then the athlete says, "No, no, no. Okay, would you mind installing this in my kids' room?"

42:33 They say, "Fine, because that was a standard size mattress." And so we install it there. A week later, the athlete calls us and say, "Look, I'm going to give away my 300k mattress, but I'm going to move eight sleep in my bedroom. I need it to for my own performance." And so he threw away the 300k mattress and now he sleeps on on eight sleep. That was that was pretty sick. Or there is this other story that is really cool.

43:00 So we give one of the most famous actors in the world u gets our product as a gift and he loves it. He know he absolutely loves it. And then he buys 10 of our products for everybody in his family. Then I go to this dinner and this famous actor comes in and there is me and some top top CEOs but CEOs of 100 billion plus companies, right? And so he he starts shaking hands and he spent literally three seconds with everybody.

43:31 Hi, like three seconds. Then he comes to me and he realizes I'm the CEO of eight sleep. And at that point we start talking together for like literally 5 minutes to the point where the other cos before they were looking at me like who is this guy and after that they they were looking at me with with a lot of respect. >> What is the most amount of eight sleeps one person has bought? a very famous person that everybody knows has 55 for his houses. But then there are other people that buy through embassies and they bought in the hundreds.

44:08 >> Someone bought 55 for their houses. >> Yeah. >> What? >> Yeah. >> Do you get a discount? >> No, these people don't ask for discount. They they just reach out and they their team and they just ask to help for the setup or not to to place such an order. >> That is wild. >> Yeah, >> I love that. okay, great. Earlier you said, >> well, there is another story. There is a couple and they reach out because wherever they go if they stay in a hotel for I believe longer than three or four nights they buy an eight sleep for that to install in that hotel.

44:50 >> Wow. >> Yeah. Because they can't sleep without that and obviously they're >> Do you mind that eight sleep such a premium product? Like would you like it to be more for everyone? >> We want to democratize sleep. So the the way I always say is imagine if we were Tesla, we are the Model S. there will be the Roadster. So there will be something even better, but you will also see us coming out with the Model X and Y and three. Do you worry about income inequality? I know it's kind of a but we've talked about people just buying 55.

45:22 You operate in a world where you see extreme wealth. I do as well. Do you share the concerns? >> I do. The the way I think is okay, how do I democratize better sleep? If our product was $100, probably by now we will have sold billions like literally because people really really like the benefits of what we do. And so it's our job as as a group of know an engineering group even if I'm not an engineer to make sure that we can keep reducing prices so everybody can get better sleep.

45:52 >> You said earlier about your co-founder Alexandra, I hope it's okay. She's also your wife. Y >> how how does that work most efficiently? What lessons do you have? What works? What doesn't work? >> Yeah. So we have two different channels. So one is Slack for work and one is WhatsApp for private communication. So our life and we never mix them. And so I might be screaming on Slack, we have to get this done by the end of the day and let's review this at 900 PM. And then on on WhatsApp it might be, oh, what do we have for dinner? I'm craving pizza.

46:30 I don't eat carbs. I we cheat on Friday. Friday night is when we have pizza. But as as a joke. So that is one. Second is I could talk about work all the time. Like literally 247. I love that and it helps me for her instead like a certain point she she really wants to operate like if she was an executive that you wouldn't bother after a certain time in the night like at 10 10 p.m. Okay, if it's urgent you can talk about that but otherwise if we are on the couch watching TV don't just keep talking about work because my brain needs to digest the information from the day and that is how she know she performs. But then what I can do, I can slack her. So sometimes we are on the couch watching TV. I start coming up with ideas and I start slacking her and her phone might be vibrating next to me and I know that it's me and it's completely fine and we don't talk about that even if I'm there writing a couple of messages >> and that doesn't irritate you?

47:28 >> No, because I think the way she frame it was extremely smart and she says if I was an executive that was not sitting next to you, would you call them for this thing at 10:15 p.m. Say no. and she said, "So, just treat me how you would treat our VP of ops who is in New York." >> Would you not? I I will call people at 10 or 11 p.m. >> Well, it depends on on if it's urgent or is a random idea or is something that we need to remember. If it's urgent, I call you at midnight, 2:00 a.m., 3:00 a.m.

47:58 Like, trust me, I'm going to come to your door at 5:00 a.m. I'm that type of guy. But if I just have an idea that maybe for the next the launch of the next product in the video we should talk about this I can just send you a note. when was the most challenging time for the scaling of your relationship in the company because there's always like break points you know >> in the early days I think now probably the last probably I don't know four or five years I I think we are really fine-tuned even because I I'm extremely demanding like that it it doesn't I'm a bit binary on the thing and like I'm a weirdo and and and so I can be a husband on one side But business-wise, like like no mercy. We have to do what we have to do and I can be the CEO if I deserve to be the CEO and she can do her job if she deserves to deserve that job.

48:54 >> Where were you not demanding enough where you should have been more demanding? >> No, impossible. If anything, you do I do the opposite. I'm way more demanding than what I would I would do. what I probably had to learn on my side in the early days, right? When you're so close to a person, you might act or behave in a way where you still pretend the same things, but you're not as professional as you would be with another executive that is no.

49:24 >> Yeah. And so that was one of her points where she pushed me in the early days and say I have no problem in you being extremely demanding and pretending this by this time of the day but the way know the words that you use and how you say it it cannot be just like I'm your body you need to treat me professionally like an executive and that is where I had to step up. >> I get in trouble for treating mine like an executive. She's like I'm I'm not I don't I'm not >> an executive. Don't treat me like one.

49:55 >> No, for us is is that to the point where I think Delian and Keith when they invested for the first year they I I'm not sure that they were not even they didn't even know we were married. Obviously, you disclose it when you do a round. So, it has been disclosed in every round. But because of the interaction in in the board meetings, they didn't even realize that. >> You you could ask my brain works like that. I'm very binary on these things.

50:21 like when I'm working, I'm working. >> You know, I heard this brilliant statement the other day and it's vulnerability is sharing something that you're scared to admit in spite of the consequences in spite of them. What do you think you're you're kind of scared to admit in spite of the consequences today? >> Well, I think for me a lot of things were also like I I moved to the US coming from Italy. I graduated from in low I didn't know anything about Silicon Valley. I didn't go to Stanford.

50:52 I didn't go to Harvard. We are three immigrants funding aid sleep. So in the early days it was very challenging, right? Because I didn't know anything about that world. I didn't know anything about how the US was working. So thinking of creating a product that consumers would buy and they would also like and love to scale. I had a lot of question marks if I I could really do that. And I think it was also in the early days this this fear of like can can I really scale the thing?

51:28 No. Okay, you can build a product and hundred of your friends might buy it because they are just nice to you and maybe you sell a thousand because it's a crowdfunding campaign, but can you really build a true business that really people buy the product because want that product? >> I love it. But what are you scared of today? Like >> today? >> Yeah. >> Do you know the story of when I had to move to China in the early days for manufacturing or or I didn't tell you?

51:54 >> No, you didn't. You told me. >> So it was after the YC demo day, right? We just raised five, $6 million, whatever. But manufacturing was not happening. So we had all these beautiful prototypes. None of us had any experience about manufacturing. So we thought, oh, you have a prototype and now you build it at scale and and we are done. But things were not happening. And so I go to to Alex and I say, "I have to go to China." And she says, "Why?" And I say, "Because manufacturing is not happening." And she says, "When do you go?" I'm going to go tomorrow. And she says, "When do you come back?" And I say, "Once I fix manufacturing." I came back 3, four months later. and now still today the the longest tenure employee in the company is a Chinese person that I hired during those months while I was living in China.

52:42 >> And she just put up with that 3 to four months away. >> Yeah. >> How did you do that? Like how did you make that work as a couple? >> Well, when the relationship started, we were already she was living in Mexico and I was living in in Italy for our first year. But that was by then probably five, six years before. I don't know. It's just for us, it's if the business requires that, you do what you have to do.

53:07 >> Like one thing that I'd be nervous of slash scared of if I was you is like the ways in which you work may not be transferable to having a child, going to China for 3 to 4 months, you can do it. You're a lovely human and I really appreciate our friendship. I don't think that's the type of dad you want to be. So, I'm lucky that we have some really good investors. So, I'm I'm I'm I always make them questions. I always try to learn from these people.

53:41 I don't know. I I I I think I we would figure it out. I think we would brainstorm. That that is how it works at our house, right? We would brainstorm and if I have to come back for a weekend and go back, I would I I do whatever it takes. I I go hardcore like whatever it takes and then I try to do it in a smart way for whatever is possible. >> We said before about the travels. You can travel anywhere to any hotel. What is the favorite hotel in the best place and why?

54:14 >> For work or outside work? >> You got a plane ticket to go. You can go anywhere. >> Well, I love Maldives. >> Okay. Where do you stay? >> that's private. >> Okay. Do you don't find it boring? >> So here we have another problem which is we call Alexander and I we call it the scene and we say we have the scene and so I never took a vacation since when I sleep started. We didn't even have an honeymoon. because we set the date of our wedding to be exactly one week after the end of the crowdfunding campaign.

54:49 And I'm not saying this because oh it's is cool is the hero whatever, right? Everybody should do what they like to do. I'm just telling you how we are and how I am. And so I get bored in any place for longer than we we we calculate that longer than two nights in a place. I I I start feeling like I'm bored. Let's move to the next big thing. >> So what do you do in the molds?

55:15 >> I was literally there for a weekend because I had to be in the Middle East for work. So we just >> So you do a weekend in the molds? >> Mhm. Yeah. because I I we had to go to Middle East for work and the Friday night. But then what happened actually is that the guy who was leading hardware, he calls me that Friday night at 2 a.m. and he's saying he's leaving. And so I spent the whole weekend trying to save him because we wanted to save him. And I saved him, but I spent not the whole time. I had dinner and I went snorkeling once during the weekend but dealing with the guy but then we retain him. So >> how did you save him?

55:55 >> Because of our culture. He the company was paying him way more giving him RSUs. So liquid stocks plus paying him probably 3x more. But he loves so much what we do, how we work and what we want to build that at the end decided to stay. But he literally decide five minutes before going in the conference room to tell his team. So it was out out out and then comes to me five minutes. I was in San Francisco, his business in San Francisco. Five minutes before going into the conference room to tell his team he's leaving, he says, "I thought about that. Can you do this for me in terms of offer?" And we say, "Yeah, I'll do it." And then he stayed.

56:40 >> Can you advise me? I'm a founder of a earlyish stage company today. My talent is getting poached by hot companies, top labs. Should I pay the same as what they're paying to keep them if they're great, or do you just have to accept that it's out of our league? >> Well, I I'll tell you something slightly different. I think you cannot even compare meaning if the people are really comparing the options between a company at a total different scale to you they are probably the wrong people or it's not that they are wrong fundamentally like in in in our case is this person was tired of know there is pressure at his sleep and he does hardware so he needs to go to China Vietnam travel all the time and so it was becoming a personal choice but he's a hardcore guy and at the end of the day he realized that this is what gives him energy and so he didn't even want that life and so if you when people sometimes it's still happening today that sometimes people say oh I'm at the final stage with entropic and and sleep and to me that is a really bad red flag not even for the salary but it means you're confused there is no way that these two jobs are any way similar and I'm not talking because we are hardware versus software. It's just man get get your together. Do you want to work at a very large company that has no certain standards and probably a certain profile or you want to work at it? But here I tell you another thing that we are seeing actually and you will love this. There is another trend in Silicon Valley where there are people that have been laid off. Obviously I don't want to generalize but we have seen this in the data and so what they do is they start talking to a lot of companies and sometimes some of these at least with us they took one of our job offers and then two weeks later they switch to another company and the reason is they because they didn't have probably income or salary for every few months they want to try to get a salary or income and then they keep certain conversation open and then they take they might take another job.

58:58 >> Does that not look terrible switching so quickly? >> Yeah, but then they don't even disclose. >> so they don't change that LinkedIn to like >> Yeah. >> Do you think the valley is too money oriented? Chimath said on X recently that you know it's become too transactional. It's too financial from Chimath that really is something. Do do you agree with that? So yes, but with the caveat I think people they join a startup they should be driven and is important that they are motivated by no potential financial success and and and I agree but that success will come by know increasing the the the the equity value from X to 10X. That is also why to me it's so important right you cannot really compare us to one of these big companies that are already so big where they are way more stable and maybe you do two threex at is sleep you should come to try to do 100 or a thousandx but the the the the team size there are so many details that are totally different and so we actually want people that are very driven and ambitious but they need to be driven and ambition because of the right things. Do you think people care today more about upside in terms of 10 100x or actually just certainty of cash?

60:14 Yes, it may be more capped but you will get a tender next year and that will be done as they are every year. >> I think it's completely fine but that it goes back to get your sheet together and understand what you need and probably what your family needs. So another thing that I learned as a co is sometimes now like we just promoted one of our best guys to VP of engineering and we were running a search for VP of engineering but he wanted the job and what I told him is look we will run the search but you have your own shot so prove yourself. He did insanely well for three months and then we decided to go for him but I think it was very good that we run an external search so we could see other people as well. Right. I I found that not the the professional way to do it.

60:59 But what I told him is I'm going to give you the the job, but I don't want you to answer tonight. You go and you talk to your wife because she has seen how hard you work over the past three months. You were already working hard. The last three months you went like 130%. And so here is not just you committing to this life. If I give you the job, I expect you or I would like you that everything equal you stay with us for the next two, three, four years, right? Otherwise, I'm not going to bet on you. So, go and talk to your wife. She has seen how hard you work and you guys, both of you need to commit because it's not just you, it's your family. I completely agree. I I call it the power of pillow talk, which is why I will always spend time at a dinner party or a drinks party speaking to their partner because I want them to actually know at the end of the day why I'm doing what I'm doing and how important my family is to me and what we build is together. Yeah.

61:52 >> And so when they come home and have a day, it's like, but I do like Matteo and I know he's a good human. >> Yeah, exactly. >> Changes everything. >> It's key. And everybody has a family, right? So we need to take care of them, but they also need to be both team. >> Can I ask you when we look at the team today, how big is the team? >> We're only 160 people. >> Wow, that's small. good.

62:14 >> Our revenue per employees is way higher than Apple. Like one thing I can tell you is our companies without disclosing our revenue but other similar companies are probably in the thousand people at our revenue stage. Our output is 5x what is average in Silicon Valley. Can I ask you when we look then 3 years out it's a reasonable time frame. It's not crazy out but it's a decent. How many people will you be then? >> 250 people making a billion. which function does not exist today that will be very important or job.

62:48 >> Well, we saw a change in email. but what I think is I start thinking of in terms of teams of two. That is how I think for certain parts of the business where I think you still want two people to have redundancy and you want two world-class people overseeing that area but that area could be really big, right? So like right now our paid media team makes hundreds of millions and there are two people but like two 300 million just the group and >> and they decide all of your meta allocations all of your creatives or >> well then obviously there is a creative team but they decide it.

63:28 >> Yeah. So the the way I like to keep the organization is extremely small and flat and I'm heavily involved and that is how we can be 160 people instead a thousand and similar companies are in the thousands. >> So which function today or which job today will be gone in 5 years time and which will be created >> again I don't think anything will will be gone. I I think you can do what you're doing with way less people or the same people be spread more horizontally to cover more areas right and so maybe is a SEO maybe the same person over overseas this other section and this other section so you can be way leaner now I have a an AI internal tools team that didn't exist until 6 months ago and are the guys building these thousands of agents for internal >> and you have a separate team for that you Don't expect horizontal groups to do that. No, because this team needs to be very connected to the data engineering team because the agents needs to have access to the the data back end the the data pipeline of everything we do and so I don't know the marketing agents needs to make sure that has perfect access to the revenue by country and the CAC by country and so fine-tuning that that is the real true challenge because you want to make sure that the agents are 100% correct >> other than email marketing what agent has had the most significant can impact >> well the one for paid media right now now we make hundreds of millions with with these paid media agents now the other big one is in finance particularly in all these groups is where we save a lot of headcounts compared to normal companies right probably a company like ours you have I don't know a team of 20 people in finance our team is four people I I I just really like to keep teams small and try to see if I can 5x the output. I I really have love to when I talk to investors to ask them to compare each of my teams and the quality of the output of each of my teams to other companies they have and the deal in size.

65:37 >> You're in 35 countries. >> Yeah. >> What's the hardest country? >> Well, China because there is no you don't you don't sell on the website. So, we had to reinvent everything. >> Dude, I want to do a quick fire answer. I say a short short statement. You give me your immediate thoughts. How many hours sleep do we really need today? >> at least seven. >> Biggest sleep tip for me? >> Consistency and amount of hours. True.

66:02 If you just nail those two things, you you will be good. >> Eating before bed. Any advice? >> It's very personal. For certain people, makes a difference. For others, no. And it will change as you age. >> Huh? Does it make a difference for you? >> As I age, it it does. It depends on what I eat. My heart rate Friday night when I had pizza is my cheat day. My heart rate rest goes up 10 15% and HRV drops around 12%.

66:28 >> Wow. What have you changed your mind on most in general in the last year? >> Probably in health in general I I think really 95% of the value is just to be consistent and do the right things without going too crazy in terms of I don't know products that you can take and supplements and all that. If you just have a very balanced life in terms of eating well, training and sleeping, then the score will take care of itself.

66:55 >> What's a kooky prediction, weird prediction you have about the future that you do stand by >> that kids that are being born now will never work at least for money. Then they might do it because of their passion. >> Can you just explain that to me? Well, I I don't think if a kid is born now, by the time they're 20 years old, they will ever work. By then, I think AI will will be at a point where humans don't work.

67:24 They will do activities, social activities, even to help other humans. But what will we do then? >> This is what we need to discover. I also have this pyramid of life about the the importance of life. And to me, it's a pyramid. At the bottom you have health and then you have relationship and then you have purpose and I think this is what drives happiness. So the the first thing you need to nail in your life is to be healthy because if you are unhealthy almost nothing else matters right if you have a cancer and you risk to die in the next two three months you can't be happy. Once the health is is on is on track you focus on relationship. Relationship doesn't matter what kind of relationship. It could be a partner. It could be your family. It could be your friends but you need to have relationship of other people. Right? If you're if if you are extremely rich and healthy but completely alone and nobody wants you, you can't be happy >> and you're just a Silicon Valley tech founder.

68:20 >> And then the third is purpose. And purpose is extremely important, right? So once you're healthy, once you have great relationship, you need to have a purpose of your life. You need to work towards something. And it doesn't need to be no financially related. It could be anything that you really enjoy. But you need to have a purpose. And I think that is the part that we need to pay attention to. >> What would you advise someone asking whether they should go to university today?

68:45 >> No. 100% no. It's it's useless. >> Well, if you want to have social activities, there is the social part. But I'm just talking in a very pragmatic way. If they want to do have a a career particularly in Silicon Valley as entrepreneurs, I think it's totally useless. >> Do you believe in universal basic income? I think it will have to happen and I think probably as companies will get more efficient and probably they will need less people working for for them probably they will get taxed more to make sure that we can distribute universal income to everybody.

69:19 >> Do you think Bill Gates's suggestion was right that we should tax agent usage and token usage? >> Well, I mean there we need to talk to real experts. I just think that the bottom line of a lot of companies will improve meaningfully over the next three, four, five, 10 years. And so I just think we will need to readjust part of that bottom line to be distributed to people so everybody can have a comfortable life.

69:44 >> Would you let your children use social media? >> That is a good question. I don't have an answer yet, but some point I will have to figure it out. What do you not know yet about parenting that you are wanting to know? >> Well, I I tell you something that I I'm actually trying to do that could be slightly different. So, with age sleep, we are lucky that we have we we work with a lot of people that have been successful in in sport, but it could be ballerinas, it could be chess players, or it could be even no great businessmen. I'm trying to talk to all their dads and I want to I want to learn from their dads what they did, what they thought it worked and didn't work in how they raised their kids to then learn how I can be a dad one day.

70:33 >> What did you learn? >> Oh, I'm starting now to do my due diligence and interviews. >> God, that would be a fascinating exercise. >> It's amazing, right? Because nobody thinks about the And it doesn't need to be the like the dad, it could be the mom. I just want to learn what do they think they did right or wrong for their kids to be successful. And to me successful could be even a doctor, right? I'm not talking about athletes or sport. But I want to learn from people that just went through that. And I'm sure they they made mistakes.

70:59 >> You know what my mother did? She dropped an image of like perfection or morality or or goodness that most parents have. You know, you kind of view your parents as like good and always well behaved and generally, you know, she will talk to me in depth about all of her fuckups and the lessons that she learned. Things that you really wouldn't talk to your child about. >> But in the depths of mistakes, you have lessons. And wow, do I learn from her fuckups.

71:28 Do you know what I mean? But most would be like, "No, that was a dark episode of my life that I'm not going back to." >> Yeah. >> That I really appreciate in her. You made me think of this thing. I don't remember the exact words, but I think there is Tony Robbins saying that a lot of people that are very driven, they are always trying to please someone since when they were kids and I think it's one of their parents.

71:50 >> Yeah. >> He says you're always trying to please one of your parents or maybe know it might be slightly different based on childhood. So that is another thing particularly when I hire chief of staffs. I always make them these questions and I say you don't have to answer to me but if you feel comfortable to think about that. >> Do you want to hear something even more specific that everyone gets angry at me for, but honestly, I don't really care anymore. it's actually much more specific than that. And I've spent a huge amount of time studying it, >> which is actually most often it is boys and it is boys relationships with their fathers >> and it is a broken relationship with their father where they're trying to prove to them that they can be something, they're worthy. Yeah.

72:33 >> And that is how it most often manifests. Very rare is it anything to do with mother. >> Yeah, it makes sense. >> Really interesting. >> Yeah. >> Do you have a relationship with your father? >> Yeah, he he died but I had a I had a relationship but I I still think he set the bar and part of what drives me is also probably if I had to guess something that know almost to meet that bar but I don't know.

72:57 >> Did he see a sleep become successful? >> No. It's it's funny because if you go back to when my dad died, >> I was still a lawyer in Milan. >> So he he wouldn't know I live in the US. He wouldn't know I'm in Silicon Valley. He wouldn't know I'm an entrepreneur. He wouldn't know I'm married to a Mexican woman. Like it's funny because if if you had the cutoff day date on that date, my life would be so different from what happened after that. some two different I'm the same person but in two different worlds.

73:31 >> I'm sure he'd be so proud. >> Yeah. Yeah. The early days was hard because when I started becoming an entrepreneur, my mom didn't want because my my my mom was a a teacher in high school that you know in Italy you make a like probably,000 euro something like that 1,500 and so she didn't have any any means if I would fail as a as an entrepreneur. but I was doing well at the law firm and so I knew that probably my my boss would take me back if I would fail as an entrepreneur at Alen.

74:04 and so I I took the risk but I I had the nightmares for many years after that that I had to go back to the law firm. >> What advice would you have to a young person in their career on taking risk? I I was a law student too, by the way. >> Oh, really? Because I was told that that was a secure life. We didn't have that much money either. And it's like, you know, that you'll do okay as a lawyer.

74:32 >> Exactly. >> What would you advise them? >> So, we we talk about this with with with Alex with my wife a lot because we we imagine this moment where I'm working. So, I come from this city called Ferrara. Ferrara is a 150,000 people city in the middle of Italy. It was a castle in the middle and there are the walls from 1600ish all around. And and so now sometimes we joke about know when she comes to Ferrara and we go see my mom, she says, "How the hell did did you go from from from this city to no to the US and Silicon Valley AI and everything you do?" And so we joke about if you were meeting a kid now on the street and he would ask you how to get where you got what would you tell them? And the funny thing is I thought about this a lot but I don't have an answer. I don't know. I just kept moving things. I saw opportunity. I went for the opportunity. I fell here but that opportunity unlocked that other opportunity on this connection. And so it's impossible to explain how you go from I didn't even speak English until when I was 24.

75:45 I almost knew nothing about computers until then. And then after I graduated, I saved enough money with my first tiny startup, call it startup in Italy. And then my dad took a loan to send me to San Diego to study English. And then with that loan, I was able because I graduated with with honor to get into the big law firms. But even there everything changed. And I'll tell you this this story because my mom one day brought back home. I was around 20 21, right?

76:20 And it was no I was 20. It was my first year of you of college in Italy was four years. And I was not a great student. I hated school. Like I was terrible. And so I started university with just no midlevel grades but I didn't like the idea of becoming a lawyer just a traditional lawyer in this small town doing tiny things. I wanted something international and she brings this magazine that was coming with this journal called soatu which is the Italian wall street journal right and this magazine was talking about these big law firms that they were doing these international transactions doing IPOs and securities so I started learning about these law firms and I discovered that the only way you can get in are two conditions you need to speak English and you need to graduate with manakum out there and then in my typical faction say okay those are the two condition I'll get it done and so in Italy the scores when you go to college are from 18 to 30 I was averaging 23 from that moment on it was 30 with maun every single almost every single exam I graduated manakum laad go we take the loan I go to the bank with my dad they give him the loan I go to San Diego learn English and then I get into freshvilles then alo And then I become an entrepreneur.

77:41 >> But why? Like like I can will tell you we used to go to Chelsea Football Club every week and we didn't have that much money. Sat in regular seats that weren't very good. This sounds really descriptive and weird. I hated the smell of beer and it was horribly like aggressive in football stadiums back in 2000. you could never pee at halfime because there were too many men trying to get in and I was 5, six, seven, eight could. And then one day a friend of mine who was very rich took me to their like box or corporate and it was beautiful.

78:13 It didn't stink of beer. It wasn't aggressive and horrible. You could pee at halfime. And don't laugh like my eyes were open to like oh my god I hated it before and life was so much better with money. >> Yeah. >> And it gave me drive. >> Yeah. >> Where where do you pin yours to? Well, I I think I always had that drive because I was doing a lot of sports before, right? So, when I was a teenager, I was playing tennis compared.

78:40 >> But you've got to change your life to go from 23 to 30 and to get Magna Come louder and speak English and go to San Diego. >> Yeah. >> Like why? >> I don't know. It just clicked. So, and it's funny because I at least in terms of anything school related, I never had that. But then I'm the type of guy that when I have a goal then you don't stop me like I become a beast like I I will outwork you like you can't stop me and something clicked and that is what happened back then. Then the why I don't know I just think I didn't want to work for the tiny two people law firm of my dad doing things in Far.

79:22 >> Is that your greatest weakness? cuz I too am like you. But that's why I'm having a hip operation at 30. My shoulder is and my knee is unrepable. I can't run anymore cuz I ran 100 mile races so often that my body's just so broken. I'm a beast. I'm a broken beast. It's the scene is what I was telling you before. I have a scene. It's right. I I I can't stop. If you can put me on a boat in Sardinia, I'll I like so much what I do that then the downside is I I I don't stop and and I get bored after a few days. And so that is why we call it the scene. I I I can't relax, right?

80:09 Do you ever want to? Like one thing for me is I lie in bed at night and actually like my mind races and it's kind of sometimes very lonely alone in my head at night. Well, the now the people I admire the most as not outside business, not like people that you want to emulate are really people that you might find in many place in the world, I call it in Italy because I'm Italian that are on at the beach that they're just walking. Actually, there is this guy. We were having dinner like last week, my wife and I, and we we we see this this gentleman, and he's having dinner in a pretty nice restaurant. We we we were in Milan for work. And he's having dinner in this nice restaurant, and he's there drinking his glass of wine, and I don't drink alcohol. And he's eating a I don't remember, but a beautiful meal. And he's there perfectly dressed without the phone, alone, just thinking. And obviously I know nothing about the guy. I know nothing. But I just say I admire the guy so much that he was there treating himself without looking at the phone just thinking and enjoying his meal in this apparently to me peace. That is something I I I admire from people because I I struggle with that. Matteo, listen, I I so appreciate you being so open. I love conversation.

81:31 It's it's nicer the second time because you're able to have a a friendliness that you don't have the first. So, thank you so much for being so amazing and this has been awesome. >> Of course. Thank you so much.