.png)
KP Unpacked
KP Unpacked explores the biggest ideas in AEC, AI, and innovation, unpacking the trends, technology, discussions, and strategies shaping the built environment and beyond.
KP Unpacked
Deflation Is the Point of Innovation
What if getting cheaper is actually the goal?
In this episode of KP Unpacked, KP Reddy and Nick unpack why AI-driven deflation isn't something to fear, it's the entire point of innovation. From Davos narratives to Elon's predictions to the Grok CEO's commentary, deflation is becoming the dominant framework for understanding AI's economic impact. But construction, housing, healthcare, and education have resisted this trend for decades. Why?
KP walks through live AI experiments: writing 150 job descriptions in 30 minutes, automating recruiting workflows, and why corporate acquisitions like Consigli (AECOM) and Datagrid (Procore) are really about speed-to-market and talent acquisition, not just technology. The breakdown? These deals are cultural change plays disguised as product acquisitions and the real value is in people who are "in it" 24/7, not just using ChatGPT for poems.
Key topics covered:
- Why deflation is a core first principle of innovation and why construction has resisted it
- The real structure behind the Consigli acquisition: talent, change agents, and customer pull-through
- Why Procore bought Datagrid for speed, not capability. Bulletproofing AI takes time
- How MCP servers are hackable and why proof-of-concept to production still requires curing time
- KP's live experiment: 150 job descriptions written and posted in 30 minutes using Claude Cowork
- Why CEOs who subordinate AI strategy should resign, you can't delegate this
- The Canvas Robotics acquisition by JLG and what industrialized robotics mean for wall finishing costs
- Why 30% of every building ends up in the dumpster and how AI + robotics finally solve it
- The talent arbitrage game: why companies can't hire$5M individual contributors but can acquire them
- Safety improvements in construction: 96 deaths at Hoover Dam vs. today's job sites
If you're a founder wondering whether your product roadmap is fast enough, an investor trying to understand why acquisitions are spiking, or an operator who thinks "using ChatGPT" counts as AI adoption, this episode will reset your expectations for 2025.
Listen now.
BuildingWorks & Brookwood Sponsors
Hey hey, how's it going, Nick?
SPEAKER_01:What's going on, KP?
SPEAKER_02:Well, you know, another week, second week of unpack for the year. So uh two weeks in a row.
SPEAKER_01:We're we're on yeah, we're look at look at us, we're on a roll.
SPEAKER_02:I think I've uh published maybe about 12 sub stacks so far.
SPEAKER_01:I cannot keep up with my KP unpacked inbox. Yeah, I'm I I did have the thought yesterday, like what what what do people who are not in your immediate orbit, like I obviously, you know, you're my partner. I work I work with you pretty closely. Like, what do you people who don't know you think about your velocity of content?
SPEAKER_02:Yesterday I got three phone calls from friends, industry friends, right? Going, dude, you are fire. Like, what is like what are you doing? Stop. Like, what is going on? Like, your content is like insane. And like, what do you? I was like, look, I've just been getting up at four in the morning. The other day I got up at two in the morning. I just I couldn't sleep. Time to start pranking, you know. So but I think partly there's just a lot happening, right? Yeah, for sure. A lot going on, just so much stuff going on. Like, and then you know, I published a couple of pieces. One was about the autodesk data grid. So I've kind of also said, like, I'm gonna be like law and order ripped from the headlines because people are asking, I I get all these DMs from people on like LinkedIn and Substack, like, hey, what do you think about ProCource acquisition a data grid? And I'm like, well, I can either answer people one by one or it's a piece of content. Yeah, same thing I don't know if you saw this one when I published the thing about fifth wall. Like, we like those guys. I think you know people ask, what do you think about fifth wall? And I'm like, they're good guys, I think, you know.
SPEAKER_01:I I have some I have much respect to for fifth wall. I mean, they really they really paved the way for a lot of sector-focused funds in our space, raised a lot of capital early, got some momentum. Uh, in a lot of ways, the model that they laid out with having some, you know, large real estate kingmaker type LPs, you know, we we saw a lot of advantages of that when you're thematically focused. And yeah, definitely have stolen some chapters from their from their playbooks. So, yeah, a lot of respect to them.
SPEAKER_02:But I also think this this idea, right? That like what would be worse than not adapting?
unknown:Yeah.
SPEAKER_02:We know like the world is changing, the world is changing. I mean, I mean, what industry is immune from what I call the metamorphosis? Have you so I you you've read some of my stuff on metaphor metamorphosis? I stopped just saying trans transformation. I started saying metamorphosis, mostly because I was reading my son a book about butterflies and a bulldozer. But I didn't know that when they go into their cocoon that they liquefy. Did you know this?
SPEAKER_01:I did know this, yes.
SPEAKER_02:They liquefy, like that's disgusting, first of all. Like gross a little bit, and I just I got stuck on that idea, and I was like, that's what's going on. We all need to kind of liquefy a little bit, like it's not like build a new muscle, try something new, yeah, expand our it's a little bit like we just need to go into a cocoon and just like liquefy ourselves and then come back out of butterfly.
SPEAKER_01:Yeah, I think I think the you know the idea the idea is that you to to transform or go through a metamorphos, there has to be some significant change. It's not incremental, right?
SPEAKER_03:Yeah.
SPEAKER_01:So like how do you do that biologically? Like, you know, and then you know, like it yeah, obviously we're we'll we'll take the the analogy a bit further, but yeah, to you know, related to work or related to an organization, a company, like think about what what it would take for you for your company to truly change dramatically, like not increment, not and get incrementally better, increment incrementally smarter. Like you have to like, yeah, you gotta you you have to rethink everything and and maybe go through a you know a period of of pain or a period of gross liquid liquidification, however you would say that. Yeah.
SPEAKER_02:Yeah. I mean, if you Google images of this stuff, it's like kind of disgusting. So I so I think it it's like it has to, I think transformation is just too like soft. It's too soft. So that's why I started fixating on that, you know, the things you learn reading to your three-year-old at night. But but I think the the idea that anyone is immune, any one industry is immune from any of this is like, you know, so I thought it was interesting. People were very critical about fifth wall. And I was like, good for these guys, like good for them for adapting. It's never easy to let people go. I will say you and I have fundraised plenty. It's hard. I don't care if you're fifth wall or whoever, it's just a hard effort. And but it's also like a very ego-driven effort, right? And so to say, like, hey guys, like we're not gonna fundraise and we're gonna let some people like it takes a lot, I think. But I think you only move like that if you truly believe that the world has changed and is changing.
SPEAKER_01:So, okay, so when you say ego-driven effort is involved in fundraising, do you just mean the the the ultimate number you put up on the scoreboard? What do you mean by that?
SPEAKER_02:Yeah, I mean, like, how would we feel if we raised our next fund and it was smaller than our last? Yeah, it feels pretty bad. Yeah. It shouldn't, I mean, in a way, like, you know, it's so funny how we throw numbers around, right? Like, oh, we only raise this much, and you know, for civilians, they're like, that's a lot of money. Like, what are you talking about?
SPEAKER_04:I know, yeah.
SPEAKER_02:But but like if you don't explain this from the other day, remember a few years ago when CRB Charles River Ventures gave their fund back to their pays?
SPEAKER_00:Yeah.
SPEAKER_02:I bet they're regretting it now, because this was kind of pre-AI cycle. But they basically said, like, we don't see a path to deploying capital that'll deliver returns, so we're giving everyone their money back. That's hard stuff, man. That's like people think life of a VC is just like Easy Street. It's not, it's all it's it's but I will say it's also this ego-driven thing. You know, if you don't raise your if your next fund isn't as big as your last fund, and if you're not sure for your staff, what are you doing, right?
SPEAKER_01:I mean, for the the you know, a comparable a comparable thing for a founder would be, you know, you go out to raise your series B and it's smaller than your series A. You know, it just doesn't, you know, like to have to talk about that externally like doesn't feel good. Now, I mean, to your point, it is a purely ego-driven thing. It might, it might just be what the company needs to stay alive, and it's fine. Like just get to the next get to the next milestone, get to the next phase, and who cares like what what people, you know, yeah, what people think and what you raised at. And like the the point is building a durable business, not showing fundraising milestones and metrics. And so I don't know, to me, it's always like a zoom out thing. Like, you know, the the you know, if you come if if fifth wall comes back and it's a lower number than they hoped, and have to re-org, like, yeah, it's just like we have to we're building a durable business, and there's gonna be good times and bad times, and it's all good, we'll figure it out.
SPEAKER_02:Yeah, so I think so anyway, I think that's why I'm busy. There's just a lot going on, yeah. The data grid proportion, our own things, getting little notes from my friends that are in Davos this week, you know, just just different narratives around that. And it's like, I mean, we can't ignore geopolitical nonsense, right? I mean, how can you? You know what's what's interesting is JP Morgan came out with their quarterly numbers, right? And Jamie Diamond, who I kind of really like, I don't know that we'd be both, right? I don't know that I'd he'd be like a go get a beer buddy, but I I really just like some of the things he does. And someone made the comment that every quarter, regardless of what is going on in the world, he always talks about well, you know, we always have geopolitical risk. And somebody analyzed it like every quarter since he's done quarterly numbers, he's always talked about geopolitical risk. Like, and and the point like the commentary was it's a constant, like these things are not new, it's just that sometimes they're more top of mind than other times, right? And I mean it's interesting, right?
SPEAKER_01:It's it's interesting. You're you know, if you're not interested in politics, politics will be isn't, you know, politics is interested in you. And I feel like at I don't know, my experience with that is as you get older, that's just generally true. Yeah, I think the other thing is that you know, related to our world and and technology, like AI is the center of conversation at Davos. And center of conversation politics right now. I mean, it's just it's everywhere. And so I know one of the topics today we want to talk about what the Groc AI CEO had to had to had to speak or had to talk had to talk about. I think it was at Davos, maybe it was a podcast even before. Yeah, but the topic has been you know addressed at Davos. So it's the idea of you know AI being a deflationary tool and what deflation looks like for society. And I think AI being deflationary, immediately people get scared. But but actually there's you know, there's I mean, if you study history, there's always another, you know, another side of the coin where you know there's new opportunities created and it's not all bad, it's just different and it it maybe re removes humans from more and more work. Like we do, you know, we do we do less we do less work with our hands than we did a hundred years ago, and now we're you know, optimized and and doing more knowledge work and optimizing for creativity. And so like if you just extend that argument a little bit further into the future when knowledge is fully commoditized, it's pretty much pretty much there today. Then yeah, yeah.
SPEAKER_02:Don't you also believe that a core first principle of innovation is deflation?
SPEAKER_01:Yeah, 100%. Yeah, things should should get cheaper over time, yeah. Otherwise, it's not innovation, right?
SPEAKER_02:Yeah, if innovation is about creating abundance, abundance then therefore means there's more supply, which therefore means things get cheaper, right? Yeah. Except in construction.
SPEAKER_01:Housing.
SPEAKER_02:What's that?
SPEAKER_01:Housing. I'm just like, we haven't had any construction, housing, health, healthcare, university costs, those are like the the obvious ones that have not gone down.
SPEAKER_02:Right. And it's not that there hasn't been M. I think it's adorable when people say there's been no innovation in construction. I'm like, these guys building houses with their nail guns and drywalling on stilts, and you know, it's it's I'm I'm not saying everything has been like uh you know, put people on Mars type of innovation, but it's not like there's been zero innovation, right? There's not, you know, the the running joke where there are guys really running around stirring me a hammer these days. I don't think they even have any, you know, it's it's maybe they have one for for looks to look tough, but you know, we're not running when's the last time you've like turned a screwdriver to put drywall in, like you know. So my point is like it's not there hasn't been no innovation, we just haven't seen things get cheaper. And I think what the Grox CEO was trying to say, because everybody has you know everybody's gotta have a position on this, right? Is AI gonna create job loss? I think I think Elon Musk was talking about it, saying like AI is gonna create deflation, which is good for society, because everybody can afford everything. We'll all be rich. I struggle with that. I mean, I I don't I'm trying to think in society when was there a time when everyone was rich and everyone was happy because I feel like the human psychology never been a thing, yeah. I don't think it's real. Well, I think also sometimes people like their happiness is derived from the misery of others. You know, there's a little bit like I'm grateful to have all the things I have because those poor people don't have anything. Like there's a little bit of a weird dynamic.
SPEAKER_01:Yeah, you get satisfaction knowing that you're better than other people when you compare yourself to them. Like there is a yeah, like a weird, unfortunate human instinct that that likes to make comparisons for sure.
SPEAKER_02:And then I was like thinking about if everybody's rich, that means everybody's the same, and we call that socialism.
SPEAKER_01:Yeah, I mean, well, I think one of the questions here is how do you become rich? How does everyone become rich? Yeah, and likely it's from some sort of universal basic income. Maybe it's subsidized by the actual you know, winners of the AI race and the AI era, or maybe it's subsidized purely by governments that are extracting capital from the from the winners, right? From the winners of capitalism. But I think that in either case, you get there through a redistribution of wealth, right?
SPEAKER_02:Yeah, I think, you know, so so that's that's kind of what some of the stuff I've been writing about and some of the content has been like let's let's look at I think it's easy to fixate on quote unquote the bad news of AI, right? I also think AI is driving people to get fit either as an excuse or for reality, they're getting more efficient, therefore they don't need people, or maybe they've been bloated today. Autodesk announced or laying off a thousand people, my inbox got full. Hey, love to talk to you, right? That's part of it. People that left got let go. You know, is that a hey, they don't need those people, they didn't need it in the first place, you know, whatever it is. And it's always fascinating to me when a company lets go of that many people, and then their stock goes up three percent on the day, which basically validates like maybe it was a good business decision, right? Which is always kind of shitty too, but letting people go is a good business decision, right? So, what do you I mean, what do you I mean, we think about these industries where um so my only uh I think my only objection around health care is health care has not gotten cheaper, but we're living longer, right? As as as the person on this call that's been diabetic since they're 25. My dad was diabetic and died when he was 48. I'll be 55 in a couple weeks. I mean, I feel good, I feel okay, right? I mean, healthcare outcomes have improved, medicines improved. Yeah, I don't think there's any doubt about that. Yeah, so maybe it hasn't gotten cheaper, but maybe it's gotten better. For sure.
SPEAKER_01:I think that's right. So so let's put that, let's let's take that take that question and apply it to the built environment. Have outcomes gotten better despite, you know, yes, maybe they you know, maybe the maybe the projects take just as long, and maybe they are you know cost competitive or slightly more expensive than what they were previously, but have the outcomes gotten better?
SPEAKER_02:Oh, I think there's in one one in one place they have less people die on construction. So safety, yeah. Safety. I mean, I think if you if you ever have you ever done the tour of the Hoover Dam. I have, yeah. I did it as a as a kid, actually. Yeah, it's I mean some it's quite amazing that we've built as humans, we've built these types of structures, and when it was built, but there's bear there's bodies in that concrete, man. I wish we had like a producer, we had like producer Joe on the call and hey Joe, like you know, go look up the burial site at Hoover Dam. We need like, you know, everybody who does Joe Rogan have he's got that guy on the side that he always just says, Hey, look up Jamie. Go look up the whatever.
SPEAKER_01:Yeah, we were referencing quite a few things here. We need yeah, we might need to hire a producer.
SPEAKER_02:Yeah, I think that's like homework. God knows we don't, but forget how many people died at Hoover Dam. So, I mean, you still have job safety concerns, people still do die on job sites, but you know, I think there's been something that I've referenced, everyone references about the time and budget of building the Empire State Building that we could never, if you cost adjust and everything, we could never do that today. But I don't know how many people died on that job. So I do think that's gotten better. I think you know, at the end of the day, safety's gotten better. I think the way we treat construction workers as an industry has gotten better. Maybe some people want to argue about that. By the way, I've got somebody ping me. I've had a few people ping me lately because of all the great content, you know, great content I create.
SPEAKER_01:Quick quick aside while you're producing that. So 96 worker deaths in the Hoover Dam.
SPEAKER_02:Yeah.
SPEAKER_01:96. That's a lot.
SPEAKER_02:96, that's a lot. So uh I got a a LinkedIn message from someone that said longtime listener and fan. But he asked, it was like, why don't you guys do like listener mailbag? And I was like, I guess.
SPEAKER_01:Like I'm in. We need to we need more listeners to provide the mailbag. I I actually I have a there's an outstanding mailbag item I have too. So if you you'll want to do it for the first time today, there's a uh a longtime listener, first time caller, Kevin. I'm gonna I'm gonna ask a question to you from that came in from Kevin. He actually asked me this a month ago and I forgot. Sorry, Kevin. It's a very professionally run podcast from here. I forgot. You ready? Yeah, I'm ready. Let's go. Okay, well, so this is a good transition to acquisitions that have occurred in our in our space in the last 90 days. There's been quite a few, a flurry. And his Kevin's question was about some of your comments on Consigli. That Consigli, the AI tool that was acquired by AECom, which was like pretty interesting to see a you know, uh someone of a AECOM stature get you know get in the weeds with an AI and you know, an AI product company. If you haven't looked up Consigli, our future producer will uh share it in the show notes. But it but the transaction size actually was it, I think it came out to be public and it was around 390 million from what I heard. And uh, if I had to if if they didn't disclose that, if I had to guess the you know amount just based on the names that were participating, I would have I would have guessed it would have been a smaller amount. Like a, you know, AECOM is not doing this every day, basically, is my justification for why I would land at a lower amount. But 390 million for you know a software product company that's building AI tools in our space, that was you know quite quite a win. So Kevin's question was like he seemed he said you seemed negative about the outcome there and and thought that I don't actually know exactly what he was referencing in terms of your your commentary. I think it was a LinkedIn post you had, but I think you know my my guess is your commentary was something about the overall nature of AECOM buying, buying a startup in a tech company. Like, but anyway, you're he was asking for your commentary and so I I don't know that I'm I mean I don't know that I'm being negative.
SPEAKER_02:I just think that no one knows the real deal. Like, I mean, as a guy that structures deals and knows how deals has structured lots of deals, especially on the MA side, things are never what they appear, right? So even the number is somewhat unconfirmed, right? So we don't know if it's 390 or 90 or 39 or 9 or 390, we really don't know, right? People act like they're I don't think we actually know what the number was. So that's so that's the first thing is one we don't have, and and I'm always suspicious, much like the data grid Pro Core number that was undisclosed, right? And when you deal with public companies acquiring smaller companies, when they don't disclose the number, it means somebody there it was an asymmetric deal, right? Either it was so much that the acquiring companies endorse or the multiple the multiple they paid on it, yeah, right, or it was an acquire, right? So that that's to me that's worse. It's also hard to tell when it's a e-commerce if it is material, it has to be disclosed. Both are public company. They didn't, so therefore it must not have been material. What do you think the thresholds for material is? Some people say 10% of the market cap? 10% of the revenue, 10% of the market cap, and there's lots of definitions. If we had a producer, they'd probably look up what the SEC governments are, but some of it's kind of relative, right? So, but still, whatever the metrics were, it wasn't material. So it's hard. So anyway, so my negativity is more like a lack of information and people cheering on something that that we don't have great facts on. The second piece is they weren't a product company, they were a consulting company, right? They were a tech company, and so they I I don't and I understand I've never met the CEO of her, she's fantastic. are the team there's very fan they're fantastic dynamic super smart all those things right so when you think about being cultural change agents might be worth every penny yeah like that angle right I think that I think that's what would people pay for me to come run amok in their company like two dollars like two dollars but you know but but there is a benefit like there is a cultural change agent value to bringing these people on board and then you have to convince them to come on board you know hey Nick how much how much would I have to pay you to run innovation at AE comm I mean probably a lot right yeah yeah it's definitely a departure from the startup culture you're entering the corporate workforce again it's probably not why you left to start a startup in the first place so yeah there's some there's some of those considerations for sure right and then then I want you to bring your whole team yeah how am I gonna convince those people so if you look at like the wind surf acquisition from meta like who no one in tech actually wants to go work for meta like not really maybe they want to work at Google or Anthropic or somewhere else meta and I so you know meta had to go buy talent you know these people didn't go home bragging about going to work for meta they went home bragging about the big paycheck they got their paycheck their buyout yeah yeah so so I think I think there's something around that as a variable right so you have a change agent team what would it take these people you know and by the way you can't hire these people here's another thing to think about Acom you can't hire someone as an individual contributor making five million dollars a year because someone in HR talks about a pay band and a this and a that like you just can't do it. Yeah so this could be a great way of acquiring talent overpaying on the acquisition side and saying like hey we're gonna pay you a lot for the acquisition but you're gonna make like 500 a year because based on our pay band system that's all I can pay you right yeah so so I think people get you have to get creative right but I think ultimately it was about the talent I believe the third thing that I think is interesting is they had customers that had significant pull through opportunity for AECOM. In other words the customers they were working with were developers and owners that were hiring them to do a lot of feasibility work on the front end using AI. Which means maybe they were charging the client half a million bucks for feasibility study but it was AI driven blah blah blah but that$5000 in feasibility could have been on a billion dollar construction project.
SPEAKER_01:So what I'm saying so if you break it down like let's assume let's just say that they the number was bigger than three times discounted cash flow right like let's just assume that right how did they construct the narrative hiring amazing talent precisely I've never met them would love to talk to them I've never met them maybe somebody knows them maybe one of our 10 listeners knows them but that's my understanding I do know people that have worked with them amazing talent change culture change agents had to do something recruitment costs like not sure how we would attract these type of people and that there was a customer pull through opportunity you add all that up and maybe even whatever that is right what do you think what do you think if you're so if you're a e com or another AC consulting firm at what point does it become about AI capabilities? To me I I'm just you know I'm reading the headlines you know I'm seeing datagrid and I'm seeing Gonsigli and you know a few of the others and I'm like okay people like the the the trend here is AI capabilities for some of these corporates and and you know with Datagrid it's it's the agentic workflows that can apply to construction that Procore didn't have or they're just very early in terms of development on but they can apply that you know the product immediately and and you know it's a m massive revenue capture opportunity over the next few years for them. Do you think they're looking at it that way yet like or do you think it's purely okay we just need to go we need to go acquire more technology driven maybe maybe software focused talent that's building with AI but we're not feeling really the pain or the you know the the the the desperate desire to go out and and purchase AI tools.
SPEAKER_02:I think I think there's a couple things I think one you're trying to acquire talent right I I think one thing that people misunderstand sometimes about AI tools and building stuff in AI. What's so cool is how quickly you can proof a concept it's amazing right but I'm just telling my own personal experience lately spending a few hundred thousand dollars a year on cybersecurity SOP compliance blah blah blah going from proof of concept prototype to full production that takes time right there there's like a it's like concrete it has to still cure right it still takes time to iterate and get technology to really be bulletproof for the enterprise right if you look at like datagrid which I'm you know a little bit of a segue into datagrid they were building all this api stuff apis the new narrative around apis or mcp servers mcp servers are so hackable so hackable there there's a problematic thing so I might be so you might be able to spin up an MCP server this afternoon but a novice like me can probably hack it. So now to deploy things into going proof of concept bulletproofing putting things into production it kind of just takes time and so I think if you're pro core or a econ for that matter it's like we don't have time we don't have time like we you know could pro core go build what Datagrid did? Sure. But it might be a year or two or three you know and that's assuming pro core is going to move nimbly right that's a whole different issue. But I think it's really a speed to market game. And I think part of the speed to market I mean I you and I were talking about this you're either in this like AI zone mentally and just getting sucked in or you're not like you know there's a people like oh yeah I use openai I use chat GPT I'm like okay you don't count that's like I use web browsers right I always tell you the other day I see the when people say that I see the meme of the of the guy with the glasses chasing the butterfly.
SPEAKER_01:Right. So I use this chat GPT tool all the time.
SPEAKER_02:Exactly I told you the other day like I was up at two in the morning because I just got I've been so into like cloud co-work and I was like breaking it right and I thought okay I gotta figure out how to keep using it and not break it right I gotta figure out do I need to run some virtual servers like what do I need to do but I I think and you've gotten all like I I tell you like hey did you see what came out today right our fixation on AI is like robes during March madness right it's just like that is they're waking up every morning and watching Pat McAfee and whatever else right they're so in it I also enjoy March Madness so this is a good a good comparison I can I can comparing the the feelings and yeah I think it there are there are I mean truly there are many days you wake up and there's a new release or there's big news and it's it feels like very exciting to go learn about it and and tinker with the experiment. Yeah and go play right yeah totally I mean when did we start caring about Gonzaga?
SPEAKER_01:Not till they like marked on this right deep deep seek in twenty in 2025 was Gonzaga in 1998.
SPEAKER_02:So I feel like you're either in it or you're just not in it right and I think when you're in it I think corporates are looking at this I mean you know some of my VC friends that are like I'm sitting there texting them like hey did you see this like no I'm like you're their biggest investor and you don't know about this like dude I'm busy I'm very busy like I am very busy too but I will go down those rapid holes right so I think when you talk about hiring a team that is in it deep I won't I think there's very few companies that have those people yeah so it's a talent thing still yeah still still talent thing and I mean even if you look at the AI labs that's essentially their whole like any acquisition they're doing it's a talent thing.
SPEAKER_01:I mean maybe maybe there's some decent tooling out there but yeah ultimately like ultimately the scarce resource is great talent that is truly on the frontier and that will be the scarce like basically it's um you know you need you need someone to to point to point and shoot the gun at like the ammo is there the ammo is in is infinite now you need a you need a be you need a barrel to point and shoot and that barrel is the talent.
SPEAKER_02:Yeah no so I so I think that's where I think getting back to it that's what it's all coming down to. So I think I think you'll see it was kind of funny during the BIM days back in the BIM days my freight my friend David Fano had a company I forgot what it was called but they were like a Revit consulting shop. I forgot what it was called up anymore David if you're listening or if anybody knows David Fano a lot of people know David I forgot what the name of his company was it was like 10 guys doing Revit they were doing Revit software development and consulting they got bought by WeWork. They were WeWork's first acquisition yeah for a good amount of money those guys did great but it was because they were the only guy at that moment in time they were the only group of like 10 people that probably knew Revit better than Autobus and they were just in it. They were all in it right and so we worked like well we can never hire people that are so into this let's just buy the company and so I think the talent always wins right and I think part of it is technical right is Revit that hard was is David a technical genius you know he's a good friend. He's very smart I don't know that he's you know the Albert Einstein of our day or anything like that. And I think a lot of these people that are doing stuff with AI are not necessarily you know the geniuses of our of our time other than like the at the at the LLM company is different right at the labs very different. They are probably the geniuses of our day but it's more about attitude and you're like biased towards saying like I believe AI is a game changer and I want to be part of this. I am willing to be up at two in the morning work seven days a week and keep up with every I guess grok came out with the new thing today I haven't gotten to play with it yet you know it's like you just have to you just have to be willing to like you know it's like the people that follow all the stats doing mark during March Madness that's how you have to be like oh what what happened last night?
SPEAKER_01:I was watching this morning I my YouTube algorithm showed me a commencement address from Ilya Sutzkever who's the one of the co-founders of OpenAI and now he's at his own his own lab and the commencement address was more or less just about the coming change and how to adapt how to how you know how people and how students should should adapt. And one of the things he talks about is like there's only there's only there's a limited amount of people that really understand what's happening. And the only and the reason that is is because you have to use the tools to have the intuition like the the tools are the gateway to the intuition to see the future. Because when you use the tools you you go through yeah I think there's like many intuitive moments where you're like holy I mean they're just holy shit moments. And I think we talked about a lot of those last week where it's just like the enablement and the the commoditization of knowledge and the you know the the agents doing crazy amounts of work in the background for you that would have taken weeks and many thousands of dollars to pay people to do and you get it back in a moment's time it's just like holy cow you know and but anyway the commencement address was about where that intuition develops and you can't have it there's no way you're gonna have that that non like oh chat GPT is cool. Like I write have it write poems for me and my girlfriend. It's it's it's truly playing and tinkering with the tools where you have this like gripping sensation of oh my gosh this like the world is going to be just so dramatically different in 10 years and like I need to sometimes it's euphoria and sometimes it's dread. I actually have gone like this this week I've been like in a like more of a dread state where I'm I'm like man like I I feel like I need to be working 24 hours a day. Like I feel like I'm just gonna get like like my my skill set is only going to be relevant for two more years. I mean you're competing with me so get with it with it yeah with KP KP leveraged and having a hundred agents running around pretty scary stuff. No but but it but but seriously like there's this yeah I feel like if I'm not working I'm just immediately falling behind and uh like anyway there's like a lot of ups and downs with it. But um but it but but to get that intuition the point is you have to use the the yeah you gotta be I mean so yesterday so I'm buying this company and um we're like launching a new recruiting site for them.
SPEAKER_02:And so I was like I was getting frustrated with the team like hey I need to we need job descriptions on this thing. Right? We need job descriptions and I went into Claude and I looked at like open projects and said based on these open projects and their locations and the type of work go mine our three competitors job site job boards take their job descriptions adapt them to our business needs and location and post it I went had a cup of coffee it was like it took it maybe 30 minutes it wasn't trivial. I mean time wise but I wasn't sitting there doing it I was doing something else right back to like I was telling you like hey Claude takes over my laptop I can't do anything I need another computer because all the the windows just keep popping up all the Chrome tabs just keep popping up right 30 minutes it was done it was done I had like 150 job descriptions I mean come on all right like and that was just one of those like meantime somewhere in the company somewhere someone's doing this writing job descriptions it's over it's over game's over yeah and so now you're in this so I think we're now in this world the dynamic of winning is out work and outsp like you gotta be doing both and that's at every level I mean you know Benioff can be kind of a weirdo right for lots of reasons but you know he you can tell he's in it right he's in the tools like he's like you can't I mean back to like leadership like you can't subordinate you know you can't be the CEO of a company of an engineering company if you're a CEO of an engineering company or a construction company and you're subordinating AI strategy just resign just quit just go just go play golf you should be you've had you should be in it every day just as much as your team because only you can understand the potential of what these tools are doing. You know I've I don't think I've ever told anyone like hey go figure out what Claud can do about HR I'm like I'm gonna do it tell someone to go do that. I have plenty of people around me to tell to go you know go go do this right I've got plenty of those people I'm gonna do that. That's kind of the the point of the tools is that they would automate they they they create an extension for you not for not necessarily for your team I mean teams obviously can use it but like the intent is to empower the individual it's called it's cloud co-work it co-works with you not with your team yeah so I think I need to run here in a little bit but you know I I think this whole idea where we're talking about the deflationary aspect right is forget about like the narrative of like people losing jobs smart people hardworking people will always have something to do right people that want to sit in their cube farm and hang out you know yeah maybe that maybe they're at risk. But I think if we look at these huge infrastructures we have to keep people busy to keep people to keep people like in terms of thinking efficiently about what needs to happen next I do think between AI and robotics we're gonna start seeing a deflationary cycle construction which I think everybody which is a good thing I know and I know people like well I'm gonna get paid less and it's like no you'll actually probably make more right but society writ large will benefit I mean if we just think about I mean think about I was talking to some friends of mine they run a big tool company can you imagine building a house without power tools could you imagine it painful yeah painful but why haven't house prices come down why isn't the cost and the time to build it's just because there just hasn't been enough of a focus right at every phase of the process right we've made increment in incremental improvements in different parts of the process but not I mean I always find it fascinating right if you ever do any home renovation work and you go buy a hundred dollar drill it's like that thing's really worth a thousand in the world I mean think about what you can walk around a Home Depot and look at what you can get that makes you so productive for like nothing it's wild yeah so I think as you start seeing some of this technology you know like we've got our company Okibo that uh you know we've got a we've got a you know talk talking book a little bit but you know what who is it oh we're talking about this was it canvas robotics yeah that was one of the acquisitions I wanted to talk about yeah they got bought by JLG massive Ashcash Corporation Corporation so if those guys do a good job and take canvas industrialize them get them distribution do product improvement make them bulletproof that should be huge for the industry yep and they have to go do all those things right they have to go do all those things they can't just put it away in a corner they have to invest and they have to drive they have to but yeah but the i the idea is you reduce the cost i mean the the cost of wall finishing if you completely make it autonomous goes down i mean the the drywalling painting sanding taping it you know it all goes down dramatically just because there's not a human and involved maybe there's one human that's running a fleet of you know robots on site and that's our entire thesis with with Okibo who's in that space right so yeah and then and then you then you apply that extend that to every component of the construction process. Yeah I had a a reporter this morning ask me like why I got into why chat adventures why did I get into this and I was like well when we started on this adventure my general belief system was 30% of the building ends up in the dumpster and that's just absolutely insane right and it's true it's still true right I you know maybe I had a limited vocabulary back when we were envisioning this but I mean what I was basically saying is there's so much waste we can do better. The better really manifests itself in deflation and so maybe I've always been saying it I just I've picked up uh fancier words because maybe I hang out with fancier people these days but but no I think I mean I it was interesting explaining it to someone to really kind of reflect and be like man like the mission has not changed the mission is still the same different words mission's the same yeah I mean waste so waste reduction comes through better technology it's another way to say that yeah so we're still doing the same stuff every day trying to get better but I do think I think we're gonna hear a lot more about this and that's what I want to kind of talk about this week is I think our listeners will continue to hear this in other news sources and I think it's just gonna be like this word deflation deflationary I think is going to be an important word that people start hearing people talk about it. You heard it here first don't don't be don't be afraid of it. Yeah for sure all right man good one all right see you next week