TWiST ICYMI! Reddit CEO responds to revolt, Gerstner on markets, and more!
We’re back to recap another awesome week of TWiST!
Here’s a quick snapshot of last week’s episodes:
Monday (E1760) - Sunny and Vinny return to discuss the Apple Vision Pro, Meta’s MusicGen model, and Vinny demos Summa AI on Waitroom.com
Tuesday (E1761) - Jason quickly explains the Reddit revolt before Brad Gerstner joins to break down the state of private and public markets
Wednesday (E1762) - Forever Voices CEO John Meyer tells his founding story and reveals how his AI startup is making influencers and celebrities bionic
Friday (E1763) - Reddit CEO Steve Huffman jumps on with Jason to tell his side of the Reddit situation
Producer’s Picks:
Jon:
Last week’s standout moment was E1763, which featured Jason’s interview with Reddit CEO Steve Huffman covering Reddit’s user revolt!
Key topics:
There were some great founder lessons from this tough situation:
BE PREPARED for pushback when making significant changes, and always maintain open and clear communication with users
STAND FIRM on your decisions, even when they are unpopular
KEEP AN OPEN MIND for potential business opportunities
This chat gave a rare insight into the dynamics of managing a social giant like Reddit in the face of a major controversy.
It’s an amazing conversation. Don’t miss it! (YouTube | Apple)
Brian:
The Steve Huffman interview was awesome, but my top moment was Jason’s SOLO breakdown of the Reddit situation!
More than 8000 subreddits went dark in protest last week, and Jason did a really informative 15 minute news hit about it!
What stuck out to me was Jason’s explanation of Reddit’s history:
The company’s API has always been free.
Reddit started in 2005 and did not launch an official mobile app for 11 years!
It relied on developers building third-party apps on top of its API.
Jason gave some context on why many social startups (like Reddit and Twitter) relied on third-party devs:
In the late 2000s and early 2010s, capital was REALLY HARD to raise, and developers were REALLY scarce and expensive.
So social platforms like Reddit and Twitter were happy to rely on 3P apps like Alien Blue or TweetDeck!
The companies could rake in rake in engagement and growth from the work of third-party developers, without having to hire them!
But two things changed last year:
1) the tech landscape shifted from growth to profits (ahead of Reddit's planned IPO)
2) seemingly overnight, Reddit's data became VERY valuable (and potentially very monetize-able) as TRAINING DATA for LLMs
These two major shifts happening simultaneously led to CEO Steve Huffman’s decision to start charging for API usage.
Nick:
I’m choosing from the same episode as Brian… but a different segment!
My favorite moment from last week was Brad Gerstner breaking down the inside baseball of his “Time to Get Fit” letter to Mark Zuckerberg and Meta’s board.
His general thesis was: Meta (and all of big tech) had gotten bloated during 2020-2021, which Brad has dubbed the “age of excess.”
In the letter, published in late October, Brad advised Zuck to cut headcount, reduce capex, limit metaverse investments, and refocus on AI.
This was a few weeks BEFORE ChatGPT launched!
At the time, Meta was trading at ~$130/share (down ~65% from its pandemic peak).
A few days later, Meta hit rock bottom:
It missed on earnings
And the stock dropped below $100/share for the first time since 2016
Then, in early November, Zuck announced what would be Meta's first round of major layoffs, and the stock immediately popped back over $100/share.
Over the next four months, Zuck honed in Meta's focus on AI and reined in costs by reducing headcount by ~25%.
Since the letter was published, Meta’s stock has more than DOUBLED.
Brad’s thoughts on Zuck’s response:
"He never had to talk with me. He didn't have to double down on efficiency and AI. It's a little embarrassing to do that, right?"
"That is the sign of greatness... and when I saw that I said 'I'm pushing more chips on the table!'"
Don’t miss this one. There are plenty more gems from Brad! (YouTube | Apple)
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