Paul Ford: Hi, I’m Paul Ford.

Rich Ziade: And I’m Rich Ziade.

Paul: And this is The Aboard Podcast, the podcast about how AI is changing the world of software. [fanfare noise] Rich, there’s lots to talk about.

Rich: Is this a day of reckoning?

Paul: Are we in a bubble?

[intro music]

Paul: Okay, before we talk about whether the entire AI industry is going to die, and how vibe coding is losing all of its moxie.

Rich: Mmm.

Paul: We should talk about our AI-powered better-than-vibe-coding solution that we’re building.

Rich: Yes. Trust us.

Paul: Yes. Everything’s going to be great.

Rich: Yes.

Paul: Okay, what is Aboard? What does it do? Let’s just do this part, and then we’ll talk about all the things that are happening.

Rich: Aboard uses AI to accelerate the entire software-development life cycle.

Paul: And to be clear, right? We’re a product. We make a thing. You use it with us.

Rich: Yes. We ship enterprise software. We ship big software. And big software cannot be automated away. We send people out to help you, but boy, we do it 10 times faster.

Paul: A nice way to put it would be, we are your partner for AI acceleration.

Rich: Ooh, I like that, Paul Ford, you’re good with words.

Paul: But we’re product-powered. Product-powered.

Rich: You see, you always got to take it too far.

Paul: Puh. Puh.

Rich: Too far.

Paul: Okay.

Rich: Too soon.

Paul: So check out aboard.com, keep an eye on it, because there’s some new, wonderful things that are about to happen at that website.

Rich: Yeah.

Paul: It’s pretty cool stuff. Okay. I like to read the internet.

Rich: Hmm.

Paul: Yeah. Lots of stuff on there. You ever been on there?

Rich: It’s good.

Paul: It’s wild.

Rich: Incognito, baby.

Paul: Wild stuff. So one of the things that was just shared in the Slack here at Aboard.

Rich: Uh huh?

Paul: Also, you know, Slack—Salesforce owns Slack? Benioff just went full MAGA.

Rich: No, he didn’t.

Paul: Yeah, he really did.

Rich: He did not.

Paul: He did. He’s like, “Ah, you know, Trump, he should come in, he should bring the National Guard to San Francisco.”

Rich: Have you been to San Francisco?

Paul: Yeah. It doesn’t need the National Guard. That’s the last thing it needs.

Rich: It’s the last thing it needs.

Paul: Anyway, regardless, so, but anyway, we’re on Slack. A little bit of a derail there. Sorry. And our head of design, actually—

Rich: [laughing] Benioff’s just worried about Dreamforce. That’s all he cares about.

Paul: [sighs] He really is.

Rich: The National Guard can leave right after Dreamforce.

Paul: Actually, he just wants the National Guard to come to Dreamforce.

Rich: He wants him to buy Salesforce.

Paul: “Hey, guys! Foo Fighters are playing.” All right, so…

Rich: Yeah, talk to me.

Paul: New person to me. Chris Pisarski, co-founder of Crustdata, which is a Y Combinator company. Real-time B2B data kind of thing, like, tracks the web.

Rich: Okay.

Paul: Okay? Big old LinkedIn post from Chris. And the first three words are, “Is Lovable dying?”

Rich: Dying?

Paul: Dying. Lovable is a vibe-coding tool.

Rich: Let’s workshop this headline a bit.

Paul: [laughing] Okay.

Rich: Is Lovable Less Lovable?

Paul: It is. It’s apparently less lovable. So I’m gonna like, look, this is a lot of information to take in—

Rich: Pause.

Paul: Okay.

Rich: We have millions of listeners from all walks of life. What is Lovable?

Paul: Lovable is a vibe-coding tool and what that means, and there’s a few, there’s Replit, Bolt, vO, Retool. And, I mean, there’s us, too, in a way.

Rich: Base44.

Paul: Yeah. You go and you type, “I want a website that,” or, “I want an app that,” or, “I want a this.”

Rich: You make software with AI, is the promise, generally speaking.

Paul: And it spins up a coding environment and it writes a lot of code for you.

Rich: A lot of code.

Paul: There are two kind of end states. One is maybe it will host that code that it wrote for you.

Rich: Mmm hmm.

Paul: And that will talk to a database and all sorts of things that they manage for you. Or you’ll kind of hit eject, take that code with you, and continue to work on it like any code.

Rich: Mmm hmm.

Paul: There’s a tricky thing happening—so according to Chris Pisarski, there was a real viral wave over the summer around vibe coding. Everybody got real excited.

Rich: It was the thing. It’s worth noting, besides the self-service, answer-questions, make-an-image uses of AI, which dominate AI, the number-two use of AI has been this explosion in tools that are going to make apps by coding. AI knows code.

Paul: It’s one of the ones that’s most professionally transformative, right? Like, people are—

Rich: Yeah, intentionally. Yes. So Lovable is one of those tools.

Paul: Using web traffic as a proxy.

Rich: Mmm hmm.

Paul: This person is claiming that vibe coding is half as exciting to the world as it was in the summer.

Rich: Whoa, hold on.

Paul: Okay?

Rich: Summer, that’s three months ago.

Paul: Yes.

Rich: So—

Paul: Well, six.

Rich: You know, that’s, that’s not just a—

Paul: No, you’re right. Three months. Three months.

Rich: That’s not a flattening out of the chart.

Paul: It’s not great.

Rich: Down 50% in three months?

Paul: Yeah. In particular Lovable. Lovable really peaked, had a big, like, viral pop.

Rich: Okay.

Paul: Look, everything with a grain of salt, like maybe the people at this, these companies would be like, “Yeah, web traffic is down.” But what I have noticed from the vibe-coding tools, and he affirms this: There’s less value available at the prompt for free with all of them. We use them a lot.

Rich: Yeah.

Paul: And you hit this wall really quickly where they’re like, “I need you to pay. Gotta pay.”

Rich: It’s expensive for them, by the way, because they have to pay one of the large AI providers like OpenAI—

Paul: And I gotta tell you—

Rich: —to do this stuff.

Paul: I feel for them, because they found something really neat, it got everybody really excited.

Rich: Yup.

Paul: They have this external dependency that can squeeze them as hard as it wants in the form of, like—

Rich: Yeah.

Paul: You know, Anthropic or OpenAI.

Rich: Yup.

Paul: And Anthropic and OpenAI have launched really good vibe-coding tools that come with your subscription.

Rich: Built-in.

Paul: Built-in.

Rich: I mean, you’re touching on vulnerability number one here. We have talked about this…gotta be a half dozen times on this podcast about, we have had a particular position around why this is really, really challenging, and why it seems to be tilting more towards trend than an actual transformative tech. But before we get to that, it’s worth mentioning that these startups, they’re big, they have millions of users, they’re very well-funded.

Paul: They’re valued sometimes in the billion or billion-plus space.

Rich: They are repackaging output from one of the large LLM providers. That is what they are doing. Now, they may do their own thing at some point, they have a lot of money now, so they might index GitHub on their own and do their own special thing. But issue number one is you can repackage and doll up something that someone else delivered and that only goes so far.

Paul: Look, the way I would describe AI is that the first mile of a project is extraordinary, because it seems so human and so it fills in the blank page, it writes you all this code. And, and to be fair, getting started is the hardest part in software.

Rich: Yeah.

Paul: So is finishing. And so that last mile is really long. Those are the two hardest parts. Getting started, it’s really good.

Rich: Yeah.

Paul: Finishing? The other hardest part? It’s not as good. And it is—

Rich: It’s not that it’s not as good. Let’s not sugarcoat it. Code is deeply, deeply complex. Code coming together at a large scale is really, really hard. It’s not “not as good.” It doesn’t work.

Paul: Well, to be fair, right? Most software projects never complete.

Rich: Most software projects never complete, right.

Paul: And so, like, whatever the LLM learned, I doubt it learned how to finish code because there are no precedents.

Rich: Right.

Paul: We created an agency and were successful in the past simply because we had finished things.

Rich: We shipped.

Paul: And people would come to us and they would say, “You’re so expensive and I hate you and I hate my life that I have to talk to you.”

Rich: Yes.

Paul: And we’d say, “I know, but we will ship your code.”

Rich: Yeah.

Paul: And we did.

Rich: Yeah.

Paul: And so, like, there’s no place for the LLM to learn how to get something done. And so people are learning this, right. Because they’ve had this, you have this explosive moment where it, like, put the app on the screen with the buttons.

Rich: Yeah.

Paul: “Holy crap! That was kind of what I thought it would look like.”

Rich: Yeah.

Paul: And then you go to Reddit and there are all these stories, and the stories are like, “I can’t believe how bad this is.”

Rich: Yeah.

Paul: Or like, “I shipped it—” I read one the other day, and there’s a lot, this is not me cherry-picking. And there was one, but it was really telling, which was, “I guess when I wanted it to do authentication, I should have realized I needed to tell it that more people would be logging in through Google than me.” Right? Like, it created an authentication system for only the one user.

Rich: Yeah. And this is normal, by the way.

Paul: Yes. But a human being would never have made a one-person auth.

Rich: I’m going to become famous because I’m going to tell you the two reasons why…

Paul: The Yankees…

Rich: Suck. Why vibe coding, as it exists today—and it may exist in another state in the future—doesn’t work. Straight-up. This isn’t shit-talking—

Paul: Number one.

Rich: Number one, you just pretty much backed into it, which is, good software is a product of extreme explicit detail.

Paul: Okay.

Rich: If you don’t have explicit detail, for example, anyone can sign up to the service via Google auth and log in later. If they forget a password, it will email them back. It supports two-factor auth.

Paul: Engineers are people who actually live inside of this detail, and as they get more senior, that knowledge is embedded in their craft, right?

Rich: Exactly.

Paul: So, like, if I’m an engineer and I say, “I need to authenticate through Apple, Google, and possibly Facebook,” I know that there are 70 or 80 things that are implied by that statement.

Rich: Exactly. And so the thing AI does not do almost ever is toss work back to you. It just goes. And so when you write two sentences—

Paul: I mean, that would be a very unsuccessful product, right?

Rich: Yeah. Yeah!

Paul: The whole point of it is you lie there on the couch, you eat grapes, and it writes your app.

Rich: Correct. But a good product manager, like a good physical architect, like a good industrial designer, says, “I got a lot of questions for you.”

Paul: Right.

Rich: Because I got to fill in those blanks. If I don’t fill in those blanks, I’m going to fail you. You’re going to fire me as a client, because I don’t know all the details. And today, the posture of AI, it does feel like magic at first because you wrote one sentence and it just starts unraveling all this code at you. You’re like, “Oh my goodness, that’s incredible.” But what it’s doing is making a host of assumptions about what you want without asking. And that’s problem one, which leads to, like, real challenges. Because, like, “Where are you going? Don’t do that.” Do you want problem two? And then I become famous.

Paul: Okay, that’s good.

Rich: As soon as I finish problem two.

Paul: Let’s do problem two.

Rich: Problem two is much more nuanced. And frankly, you are better with words than I am. But I’ll do the best I can.

Paul: Maybe I’ll just restate it once you’re done.

Rich: In the presence of Paul Ford.

Paul: Great.

Rich: You touched on this, too.

Paul: Okay.

Rich: AI does not know why it’s doing anything.

Paul: No. It lacks consciousness.

Rich: It is an expression engine.

Paul: Yes.

Rich: It will express itself all day.

Paul: God, you just—there was a PHP platform called Expression Engine.

Rich: I’m sorry.

Paul: Yeah, you just, you just—

Rich: Flashback.

Paul: It was, like, sort of like a for-pay Drupal kind of thing.

Rich: I remember it.

Paul: Yeah, anyway.

Rich: it wasn’t great.

Paul: Yeah, keep going.

Rich: Shout out to the Expression Engine fans out there.

Paul: Good job, guys.

Rich: Somebody’s maintaining Expression Engine for a lot of money right now. [laughing]

Paul: Oh, are you kidding? There’s probably 200,000 installs. All right, keep going.

Rich: It is not driven by purpose or goal, or even a subset of goals, or a nested set of goals. It is just expressing code. It is literally writing code. And it does not distinguish code which is actually going to be sent into a machine to be turned into, like, working tools. It does not distinguish code from a poem, from an essay—

Paul: It’s another set of tokens that it produces.

Rich: It’s another set of—now you say, “Well, wait a minute, though. When I say, make me a website for my restaurant, it kind of made me a restaurant for my restaurant.” And the reason it did that is because it took your words, it found code that is related to those similar words, because other restaurant websites have been created, and it created one like those. It does not know it’s a restaurant website. It doesn’t know that you want to make reservations on it.

And so what happens is this chase occurs with vibe coding, which is like, “I need to book reservations on my site.” And then it goes and does the same thing again, which it goes and looks for things that are similar to what I just said. And it has no understanding that reservations lead to people eating at tables in a place where food is given to them. It doesn’t know anything. And so, as a result, it starts to create what I call long, endless strings of liability. [laughing]

Paul: Yeah.

Rich: It is code that looks like code to us but is, in fact, oftentimes voluminous because it doesn’t mind, it doesn’t try—

Paul: No, I go back, there’s a formulation the writer Rusty Foster came up with, which is language without thought. We’ve never had language without thought before, and it’s really confusing, because we just expect the thought to be there.

Rich: Baked in.

Paul: Yeah.

Rich: Yeah.

Paul: And it’s not. There’s no intentionality.

Rich: Correct.

Paul: And here’s what drives me bananas, is like, that’s amazing. That’s the weirdest database ever. And we should be having a really good time with it and talking about it and figuring out where it begins and ends.

Rich: Yeah.

Paul: But we decided that we were gonna have Star Baby Jesus instead?

Rich: I mean, I think this language without thought is such a profound message. Like, we just did a podcast on Friend.

Paul: Yeah.

Rich: The pendant you wear because you’re lonely.

Paul: Yeah.

Rich: And, you know, language without thought in that context is even more depressing. Like, it’s. It’s, like, devastating compared to this, which is, like, functionally, it won’t make sense because it’s not actually thinking about a goal. That one actually doesn’t care about you. Like, to find out that it was all a sham and you didn’t really care about me is also kind of rough. [laughing]

Paul: I mean, the behavior, typically the behavior that we associate with that is sociopathy.

Rich: [laughing] It is—

Paul: Right? Like, it just faked, it faked loving you—

Rich: Charming.

Paul: It faked caring about you.

Rich: It’s charming!

Paul: It told you how great you were, only to manipulate you the whole time.

Rich: The whole time.

Paul: Then it killed you.

Rich: So let’s talk about the most recent trend. And I don’t know this, like, if this is happening everywhere, I know Replit is doing it, which is they’re onto this. The vibe-coding startups are onto this challenge. And so what I’m seeing them do, and again, I only have a couple of data points here, is they’ve decided to solve it by doubling back over. And I was shocked. Like, I hit Replit last week, it was like, “I need 20 minutes.”

Paul: I know.

Rich: And what that is—

Paul: And you got to get your credit card out.

Rich: And you got to get your credit card out. And what that is is an attempt to take all that chaos that unfurled without thought, right, and somehow just keep sanding it down to maybe till it gets to a point.

Paul: I’m going to tell you my hypothesis here and then I think we should talk about—

Rich: This is crazy.

Paul: Here’s the future state. The future state is not throw the LLM at it over and over and over again until you get the result you want. Because what we have learned, because I’ve tried to build the same things hundreds of times in a row.

Rich: Totally.

Paul: What we have learned is that actually never quite works because the intentionality gets divorced from the product. It’s hard. Your brain can’t stay on top of it enough.

Rich: It’s impossible.

Paul: And so it just ends up spewing a bunch of stuff and, and you just keep trying and eventually sort of trial and error, it sort of, like, gets something together.

Rich: Yeah.

Paul: But you’re going to keep finding bugs like it only lets one person log in. That’s what this is. Now it can get smarter, it can get better. God bless us all. That’s the sort of, like, boil the ocean. Let’s go. AI will solve it.

Rich: I think we should point out how these things are useful.

Paul: Sure.

Rich: How they can be useful.

Paul: Great at starting, great at prototyping, great at exploring the problem.

Rich: Demos. Walk it over to engineering.

Paul: They’re wonderful at expressing alternative algorithms, other ways that you could solve a problem. Like, there’s a million ways—

Rich: More discrete puzzles.

Paul: Great way—these are really good acceleration tools. They are good at looking through code and fighting bugs if guided.

Rich: Yeah.

Paul: There’s a million ways to use them, but that kind of one-shot got my app, ready for market? Here’s where I think we’re headed, and we’ve put a bet on this, this is what we do, but I don’t think it’s just us. It works really well when there’s really, really well-defined kind of scaffolding and blueprint.

Rich: Okay.

Paul: Okay? You’re building and structuring things and then, so what’s going to happen in this market is I don’t think you’re going to be able to have a one-size-fits-all, we will write every kind of code that you ever imagined. I’m not going to have one tool that lets me write a 3D game that also lets me write an ERP tool that lets me write a CMS.

Rich: 3D ERP would be pretty fricking cool.

Paul: That was very 90s. Like, it was sort of like everybody was trying that stuff. [laughter] Like the, yes, I’m gonna walk through my supply chain—

Rich: 3D warehouse?

Paul: Yeah, yeah. I’m gonna buy, like, a $30,000 SGI machine and, like, walk through it.

Rich: I think there’s a movie with Demi Moore where she like walked—I think, Disclosure?

Paul: Yeah, that’s right, that’s right. Anyway—

Rich: She walks around in 3D land and there’s, like, a folder, a manila folder that she finds.

Paul: We’ll come back to that.

Rich: But—

Paul: We won’t come back to that.

Rich: We’re never coming back to that, actually.

Paul: But I think that if you look at the future of this stuff, instead of solving every single problem in the world, you’re going to end up with situations where people choose a relatively narrow but still broader than ever before—

Rich: And then let it code.

Paul: Let it help. Figure out how to put it on rails. So we did that with businesses.

Rich: Vibe helping?

Paul: Or vibe product or vibe—I’d get rid of vibes. Just scaffold-driven development. AI-assisted development. Right?

Rich: Yeah.

Paul: So it helps you get the plan together.

Rich: Yeah.

Paul: It’s good at that. It’s good at boiling stuff down. Maybe other things help you get the app together. Like—

Rich: Yeah.

Paul: You know, like, it’s good, it’s good at being a non-player character, it’ll be good at helping you get assets together for your 3D game, etc.

Rich: Yeah.

Paul: Like, you’ll have, there’ll be new and different loops that you interact with.

Rich: Yeah.

Paul: But what I’m saying is, like, we’re going to be back to a world of applications that are specific to domains.

Rich: Mmm hmm.

Paul: As opposed to the one does-everything super app.

Rich: Yeah, if there’s one takeaway, I think, because there is magic in AI showing up.

Paul: Yeah, but you’re not going to let it replace AutoCAD to build a house, right?

Rich: You cannot universalize a shortcut. There is an incredible shortcut that comes with AI. There’s like, it’s better ways to shop and better ways to answer questions or refine an essay or whatever. But to think that that magic trick can just now be applied everywhere? I mean, we’ve seen that before, and I think that is driving the bubble that exists today, because everyone assumes that I can apply, the cures for diseases are coming, you don’t need lawyers anymore, all this stuff.

Paul: No, you know, what’s happening is product. Product is reasserting itself and instead of one meta product—

Rich: It’s never that clean.

Paul: We’re getting lots of little products.

Rich: So let me ask you this.

Paul: Are we in a bubble?

Rich: Are we in a bubble?

Paul: Yeah.

Rich: We are in a bubble.

Paul: We are. I mean, I just got an email from Bloomberg this weekend, you know, because they like to get in touch. I love those guys. And they’re like, “Hey, you know, what would an AI crash look like?” And there is just, the bubble—

Rich: Wait, hold on. When people, when you say to people, “I got an email from Bloomberg.” That’s not the Bloomberg newsletter we’re talking about?

Paul: No, it is the Bloomberg. I’m kidding.

Rich: Oh, okay.

Paul: It’s the Bloomberg newsletter.

Rich: Okay.

Paul: Yeah. My buddies at Bloomberg—no, there’s podcasters, there is, people are—

Rich: It’s in the conversation right now.

Paul: I’m getting a lot of bubble DMs.

Rich: Aaron [Andrew] Ross Sorkin.

Paul: Yeah. Who—

Paul: Manages the Yankees.

Rich: Does not manage the Yankees. [laughing] That’s Aaron Boone, who should be fired, by the way. That’s a separate conversation.

Paul: Not Aaron [Andrew] Ross Sorkin. Don’t fire him.

Rich: Yeah. Don’t fire him. He was just on 60 Minutes.

Paul: Mmm. RIP.

Rich: Which has just been neutered. But put that aside, also.

Paul: [laughing] Okay.

Rich: Talking about a bubble. And she’s like, “Is there a bubble?” And he’s like, “I think there’s—” Well, he also just wrote a book called 1929. Thanks, Aaron [Andrew], for really cheering us on here. He thinks we’re in a bubble. We are in a bubble. This is the classic over-enthusiasm and ambition around the possibilities of tech, and we’ve seen it before.

Paul: I’m going to tell you what I really believe here. I believe we are in a financial industry-focused AI bubble.

Rich: Mmm.

Paul: I do not believe that AI as a technology, or that tech in general, is severely overvalued. I think that everything is misallocated.

Rich: Explain.

Paul: Right now we’ve got these giant companies that are worth half a trillion dollars at a pop or more, right?

Rich: Yeah.

Paul: And we have these—

Rich: Let me counter just real quick on that point.

Paul: Okay.

Rich: This is the fastest growth and adoption of a technology ever.

Paul: No doubt.

Rich: It is fundamental.

Paul: No doubt. Credit cards are out.

Rich: Yeah.

Paul: But it’s not at a $400 billion, you know—

Rich: That’s different.

Paul: —investment level. Like, it’s just, there’s so much money pouring in.

Rich: [laughing] Also $20 a month, even if you get everybody on the Earth and maybe their pet dog to sign up, arguably doesn’t still fully justify the value. So it’s tricky.

Paul: Let me talk about a—a resilient company is one that, like, the market goes up, the market goes down, but it continues to provide value to other sort of, like, resilient, somewhat boring companies. One of our best agency relationships that continues in our current world is with the insurance industry. Because you got to keep insuring your house, because hurricanes don’t stop.

Rich: No, they don’t.

Paul: Okay.

Rich: Nor do fires and earthquakes. I mean, you got to insure your house.

Paul: Insurance—

Rich: In fact, you have to, you’re required to if you have a debt on it, if you have a mortgage on your house.

Paul: Insurance companies have vast, enormous roadmaps that they need to service, but they’re also bureaucratic and they also have a lot of governance and bureaucracy they have to deal with.

Rich: It’s not fun.

Paul: It is not fun—

Rich: Insuring a house.

Paul: If you’re, like, a 27-year-old Nordic guy and you want to do a startup, you don’t want to go towards insurance.

Rich: Correct.

Paul: But I’m going to tell you, when the recession hits or the crash comes.

Rich: It’s incredibly resilient.

Paul: Insurance is going to keep needing digital products all day long. You know another one that’s really wild? NGOs. They’re getting hit by federal funding cuts.

Rich: Yeah.

Paul: They are losing money right now. They are actually being forced to be more resilient. So one of the first things they do is look at their IT spend, which isn’t theoretically core to mission.

Rich: Also more active fundraising.

Paul: Let’s say they run homeless shelters. Right? You can’t actually get too much money off of running a homeless shelter. It’s pretty tight.

Rich: Yeah.

Paul: But maybe you can, maybe you can take some money out of your software budget.

Rich: Yep.

Paul: And so if you’re there, you have a chance. Now, what I’m gonna—

Rich: Circle back to this point, though, which is it sounds like what you’re saying is this valuation is sort of—

Paul: When the squeeze comes—

Rich: It’s fantasy.

Paul: Yeah, okay, sure. Of course it is. Because people keep pouring money in. Everybody, like, grabs you by the shoulders and is like, “Hey, we’re in a bubble, but I need to put another couple million dollars into this.”

Rich: No one knows when the ride ends.

Paul: Yeah. Everybody is like, “I’m not the greater fool.” Right? Like, “Not me.”

Rich: I mean that’s how bubbles happen.

Paul: So taking it back to my idea here is that if you, if you really look at it, if we’re really in a bubble and a crash is coming, if we’re not in a bubble? All right, well then. Okay. Okay, what am I going to do? Okay.

Rich: Yeah.

Paul: Good for you guys.

Rich: Yeah, yeah, yeah.

Paul: Sam Altman can go live on the moon. Fine.

Rich: Yeah.

Paul: Yeah. But if we are in a bubble, then the bubble is going to crash. And the bubble, what that means—

Rich: Is it crash, or pop?

Paul: Either one. It’ll pop. Bubble pops. And then all the people who confidently look us in the eye and say, “Our VC thesis is that only companies in this, like, tiny little hot zone are worth investing in and never ever should anyone ever talk to a human being, ever, and everyone will pay for this forever, and we will have crypto.” Like, everyone who has these little—what you see is this very, very striated approach to how we’re gonna approach the market and what we’re gonna do. And that’s where the money’s flowing—

Rich: Yeah. Well, I mean, out of fairness, they are making moonshot bets.

Paul: No doubt.

Rich: They expect 90% to fail.

Paul: But every time this happens, you get that same deck from Sequoia, that’s like, “Batten the hatches, boys!”

Rich: Yeah, yeah, yeah.

Paul: [old sailor voice] “Storm’s a comin’!”

Rich: Yeah, yeah, yeah.

Paul: And then like, you know, a large percentage of startups go to startup heaven, which is literally just getting acquired by Google.

Rich: Yeah.

Paul: And then you’re—

Rich: The ones that have something worth acquiring, whether it be people or a piece of technology or whatever.

Paul: Free coffee.

Rich: Heaven’s nice.

Paul: Yeah. You got a ball pit.

Rich: Yeah. Okay, so when is it gonna crack? When is it gonna pop?

Paul: I mean, literally any day. Why wouldn’t it?

Rich: Well, or a year.

Paul: Yeah, I mean—

Rich: Or two.

Paul: I mean, it could be any, at any moment, right?

Rich: Yeah.

Paul: Because there’s no… Here’s why. Because of that last mile problem, everyone’s been lying about where this thing can get you. There’s a ton of product work to be done, and there’s probably, I would say there’s probably like 10 or 20,000 companies that need to be created.

Rich: Yeah.

Paul: In order to actually materialize the value in this technology.

Rich: Yeah.

Paul: I see the value. I believe in it. But I need 20,000 companies to exist before we can really get there.

Rich: Yeah.

Paul: It’s not just going to be faster agents or bigger LLMs or this, that, or the other. It is, like, a zillion little products landing. And then we go like, “Man, that one’s really good about my calendar.”

Rich: Yeah.

Paul: And it won’t be—OpenAI can’t capture all this value. Anthropic can’t capture. They just don’t. You need, like, half a million people messing with this stuff.

Rich: Are you surprised that things consolidated to like three companies so quickly?

Paul: No, because that’s the way the Valley works. The Valley wants to create that tight, super-hot market. They want to get in on the next big thing. Sovereign wealth shows up. It’s just a picture of like Sam Altman in Qatar. Right?

Rich: Yeah.

Paul: Like, he’s just like sitting there with emirs, and it’s just how this goes.

Rich: Yeah.

Paul: It’s, we’re gonna—

Rich: Is that bad?

Paul: I don’t—I’m done with bad and good. I mean, there’s a lot of things that I just wish were really different. I like messy and I like—I like after the crash, because everybody has to, like, figure out what it’s good for.

Rich: Yeah.

Paul: I don’t know. After the, after the dot-com crash, I used to go and, like, meet at people’s houses to talk about tech.

Rich: Yeah.

Paul: Right?

Rich: Yeah.

Paul: Because we just loved it.

Rich: Yeah, yeah.

Paul: And everybody else went home.

Rich: Everybody went home. And I started my business two years after the crash.

Paul: And I think I, like, came to your business and like, you know, you, like, you show up with—

Rich: We were nerds.

Paul: You’d bring bodega beer.

Rich: Yeah.

Paul: You’d be like, “Hey, look, I got some Newcastle.”

Rich: Yeah.

Paul: And then you’d, everybody would, like, do a demo of their new web thing.

Rich: Nonsense. Yeah, yeah.

Paul: Ah, it was wonderful.

Rich: It was wonderful.

Paul: Wonderful. People would go, gather and talk about XML. Right? And out of that comes Web 2.0. And out of that comes all the new, wonderful things.

Rich: Yeah.

Paul: And mobile starts, and the Valley basically likes to kind of own the narrative, and I get it, and they’re smarter about this shit than we are. They win a lot.

Rich: Yeah.

Paul: Give me 20,000 startups, not five. Get me there, and then you’ll find that we’ll be back here after the crash. But it’ll be sustainable.

Rich: Yes, there is value here somewhere.

Paul: No, I’ll go to my grave on that.

Rich: No, I agree, I agree with that. That rant was extremely New York City. Today’s podcast is brought to you by New York City.

Paul: No, we, like, I mean, shit breaks here.

Rich: Yeah.

Paul: It’s bad. And you know, and we will, absolutely, we will put a socialist in as mayor. [laughing]

Rich: Let’s give everyone, this is one of the most expensive cities in the world, one of the toughest cities in the world to survive in.

Paul: I know, I’m very proud of that.

Rich: To have a family in this is really hard.

Paul: Everything is a nightmare.

Rich: If you want to know how to come out of a bubble, go on YouTube and search for Eyewitness News 1978.

Paul: It’s WABC 1978.

Rich: WABC 1978. And you will see a city on its knees, like, in really bad shape. Bankrupt. They can’t fix parking meters. And—

Paul: And it’s so depressing. Everything’s so bad all the time.

Rich: All the time.

Paul: Like, literally the news is just them going, like, “Another terrible day in New York City.”

Rich: Let’s close it with a question for you, Paul Ford.

Paul: Okay.

Rich: These startups that are riding this wave right now—

Paul: Lovable, Replit—

Rich: You’re just pointing out they’re all declining. And will they survive?

Paul: I mean, frankly, I hope so, because they all innovated real early and they took a real big swing.

Rich: Yeah.

Paul: What they need to figure out, and this is the struggle that you and I have. We’re focusing on business applications. We’re focusing on partnerships instead of doubling—we’re not going for consumer product.

Rich: Yeah.

Paul: We’re trying to take what we learn and sort of see if we can accelerate services with product. You know, just, it’s a complicated time. It’s hard to get these messages across. I don’t know if we can have 12 of them really big and also have, you know, Claude Code and Cursor and…

Rich: The big guys have the toys as well.

Paul: Boy, that’s rough. That’s a rough moat to just continually be scaling.

Rich: And they can just turn up the meter on them and that’s that.

Paul: Yeah.

Rich: Because they’re riding on top of them.

Paul: They really can. Right? And so, like, what I would say is where they can thrive is by verticalizing—like, they actually have good platforms. Figure out, like, five markets and chase them because you got a lot of money right now.

Rich: Yeah, that’s not interesting to a lot of that world.

Paul: I know, I know.

Rich: Why not boil the ocean.

Paul: Well, what they want is a trillion dollars. They want to be the next trillion-dollar company.

Rich: Yeah, yeah.

Paul: But I would actually pause at this moment. I would make a couple different bets, because I wouldn’t want to keep competing on, “It will spit out the code, I promise this time. Just give it three hours.”

Rich: Interesting.

Paul: That feels like a pretty big bet. But they’re all making it. And honestly, everything with this stuff has been so weird that three months from now, I could look back on this and be like, [lauhging] “Boy, they really sailed through. They got it. They figured it out.”

Rich: Yeah, yeah. We’ve been, not to toot our horn—

Paul: [horn-tooting sound]

Rich: We’ve been right so far.

Paul: Boy, it’s a hard problem, right? And I don’t know. Here’s, there’s no—

Rich: We know the nuances of the challenge.

Paul: There’s no research horizon where it gets unlocked. There’s no, like, 10% optimization. Here’s the future I think everybody should aim for. Whatever it can do for you, it should do it for no more than a dollar of LLM time in five minutes.

Rich: Oof. That’s a challenge.

Paul: Yes.

Rich: It’s very hard.

Paul: We don’t always hit it.

Rich: Yeah.

Paul: But that is the—and actually, that five minutes should get down to one minute. Right? Like, for a dollar, I should be able to do the thing I’m going to do for you, and I’m probably paying the dollar right now, because I’m a startup.

Rich: Yeah, constraints.

Paul: But also, like—

Rich: That’s a constraint, right? We had a podcast about DeepSeek and constraints.

Paul: Mmm hmm.

Rich: And how constraints force you to be creative, to find new paths. It’s too much endless coins right now. I think that’s part of it.

Paul: Our product builds business application for you in about 10 minutes.

Rich: Yeah.

Paul: And it does it for a couple dollars in LLM time, max.

Rich: Yeah.

Paul: Okay? And so that’s still—I’d love to get all those numbers way, way down.

Rich: Yep.

Paul: But it’s not three hours. And that’s because we put the constraints in.

Rich: A little jab there at the end. A little sly pitch.

Paul: Or a fact.

Rich: You know what? Facts. Check us out@aboard.com. Paul, this was a lively conversation.

Paul: You think we’re in a bubble, too?

Rich: I do.

Paul: Yeah, me, too. Okay.

Rich: Have a lovely week.

Paul: Yeah. Good luck to your portfolios.

Rich: Bye bye.

Paul: Bye.

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