The Twenty Minute VC (20VC): Venture Capital | Startup Funding | The Pitch
00:38:05 · Harry Stebbings, Rory O'Driscoll, Jason Lemkin
[00:38:05] S2: Would be worth 39,000,000,000 at the 1,500,000,000,000. So timing is important, is the takeaway, kids. [00:38:11] S1: The most compelling fact about the Binance thing was, was that they could pony up $6,000,000,000 to replace the money that was taken. That... What a good business. I mean, assuming that you're not doing an FTX and swiping it from someone else. As I understand that, and I did not spend a lot of time on this Binance were able to make good the crypto loss, which implicitly means Binance makes enough money to be able to make good the crypto loss, which means it's an amazing freaking business. [00:38:34] S0: I think so. I just think... And again, I'm not a crypto guy, but when CZ said they could cover it, but it would be tough, suggested to me they didn't have 13,000,000,000. And what I really thought was ridiculous is how many folks said that their balance sheet was all the crypto they hold as a trustee, as a custodian. That's not true. That's why Sam's in jail and CZ is out. I don't think they had $13,000,000,000 I think they got out in Black October. [00:38:58] S1: Yeah, you can't take my crypto dollars and give them to Harry and say, Sorry, your stuff was stolen. Agreed. [00:39:03] S0: Yeah, their balance sheet. Mean, think how much still happened in Black October. And then we have this... The one that I think is craziest, I don't mean to get off track, this... I know it sounds minor, but it's not this ARDEX thing that breached WorkOS and a bunch of others. This is just... Since we did the last one, this one is insane, this ARDEX thing.
00:39:03 · Jason Lemkin, Harry Stebbings
[00:39:03] S0: Yeah, their balance sheet. Mean, think how much still happened in Black October. And then we have this... The one that I think is craziest, I don't mean to get off track, this... I know it sounds minor, but it's not this ARDEX thing that breached WorkOS and a bunch of others. This is just... Since we did the last one, this one is insane, this ARDEX thing. [00:39:18] S2: I saw that Michael Grinich post about this sixteen hours ago, but tell everyone what this is.
00:39:18 · Harry Stebbings, Jason Lemkin
[00:39:18] S2: I saw that Michael Grinich post about this sixteen hours ago, but tell everyone what this is. [00:39:23] S0: ARDEX, we should be scared about. ARDEX is initially well regarded. It's only like a couple months old. A Chinese open source pen test solution to penetrate test applications. We all need pen testing. We always needed it before. We certainly needed an agentic area where everyone from Binance to the rest of world is being breached. We're all being breached. All the refrigerators in Europe are going down because they've been breached. Black October was much blacker than we made it look. And so some really smart developers, just a couple months ago in China built an open source thing, great, so it's free and you could hook it up to your deep seek and your other LLMs and it will just try to hack you. And this is what you're supposed to do. You're supposed to hack yourself, but it became very easy to turn it around and just attack other folks with agents. It became... It was flipped around and it's become one of the the greatest threat. And a lot of folks are saying, well, could always you could always do this, but now you can do it with LMs at scale. You can just tune it against anybody you want.
00:39:23 · Jason Lemkin, Rory O'Driscoll
[00:39:23] S0: ARDEX, we should be scared about. ARDEX is initially well regarded. It's only like a couple months old. A Chinese open source pen test solution to penetrate test applications. We all need pen testing. We always needed it before. We certainly needed an agentic area where everyone from Binance to the rest of world is being breached. We're all being breached. All the refrigerators in Europe are going down because they've been breached. Black October was much blacker than we made it look. And so some really smart developers, just a couple months ago in China built an open source thing, great, so it's free and you could hook it up to your deep seek and your other LLMs and it will just try to hack you. And this is what you're supposed to do. You're supposed to hack yourself, but it became very easy to turn it around and just attack other folks with agents. It became... It was flipped around and it's become one of the the greatest threat. And a lot of folks are saying, well, could always you could always do this, but now you can do it with LMs at scale. You can just tune it against anybody you want. [00:40:14] S1: So so they originally built us defensive and... Yes. Evan said, oh my god. This is a pen testing tool. Yeah. Makes total sense. It's that... It'd be basically... Yeah. It's like the guns don't kill people. Bad people with guns kill people. You built a gun, you hoped it was in good people's hands, and now it's in bad people's hands that are killing people. [00:40:29] S0: It worked... Seemed to work great at first, right, until you turned the gunner out.
00:40:29 · Jason Lemkin, Rory O'Driscoll, Harry Stebbings
[00:40:29] S0: It worked... Seemed to work great at first, right, until you turned the gunner out. [00:40:33] S1: It's probably hard to overstate the cyber dynamics of the next twelve months. You're right. It's one of those stories. You never cover it on a daily basis, but you are. At some point, something really weird is going to happen. You're going to go, Come on, guys. We should have seen that. You know, the entire US Fed wire goes down for a day, and we're like, we can't move money. [00:40:51] S2: Yeah. And we joked about the refrigerators in Europe, which for people that don't know, there was a hack, which basically meant someone could turn up the the temperature on refrigerators, and they did to 50 degrees. Now it was luckily rectified, and the frozen peas were saved, which is of great relief to everyone in Europe. But you could see this being much more mission critical things like traffic lights or, like, heating facilities or you name it. So it is it is quite alarming. Ding ding ding. Mister Lampkin, we had quite a few rounds, and it's your turn to bring something to the IC this week. Goodness. [00:41:24] S0: Can I take a break for the rest of the year? We've been busy. We've deployed so much. We've got that for three funds this year. [00:41:29] S2: No. No. No. We're Andreessen. We just raised a big ass fund, and so we've got plenty more for you to go through. Jason, we're a deployment machine. [00:41:36] S0: Which company [00:41:37] S2: are you going to take to IC this week? Serval, Cognition, Baseten?
00:41:37 · Harry Stebbings, Jason Lemkin
[00:41:37] S2: are you going to take to IC this week? Serval, Cognition, Baseten? [00:41:41] S0: Well, listen. I mean, Harry, as you know, much much as, in many ways, Windsurf team lamented having to sell out to Google for just a few billion. The Crosby team's gonna gonna lament selling to to SpaceX for only 60,000,000,000. Right? Cognition at 80,000,000,000, it seems market correct. Now to get to a 10x with dilution, a trillion dollar valuation, I start to get nervous with the latest round from OpenAI and Anthropic. I do get worried that fundamentally it only owns so much of its own IP, but geez, I don't know if you saw the last Q3 of Anthropic. Like the one thing that is working that never stops working is coding agents. And Cognition has a bunch of the field open to it. They made a lot of their own luck. I don't know if the original version of Devin, when I brought it to committee, you know, a year and a half ago, I don't know that that product worked. They lucked out buying the windsurf team. They lucked out buying IP. They lucked out from open weights. But this is something with the kind of momentum that I think we can't sit out. And we have a little bit of money left in the fund, couple billion, and we need to deploy the next one. I say we close out the last fund with $2,000,000,000 in Cognition. We're already up 5X on paper. We can't lose. We might as well put the last $2,000,000,000 in Cognition. And I say if we get a little recycling before the round closes, we toss it in two.