Sailing Champ Builds “the AdSense for AI”
I'm Rob Kelly, this is Media and the Machine, a show about the biggest technology shift of our lifetime and how to profit from it. Each week, I talk with the founders and CEOs closest to AI and content, the ones figuring this out in real time. I'm also building an AI content business myself and share lessons of what I learned along the way. You know, life's funny. I began my career lucky enough to interview leaders like Steve Jobs and Bill Gates.
Rob Kelly:Then I went on to be a three time founder and CEO, driving a $100,000,000 plus in revenue and some failures too. And now I'm back at the table, interviewing this new world's current and future leaders. This isn't only a business story, it's a human one. So every episode ends with me asking my guest what AI means for our jobs, our families, and the next generation. We'll figure this out together from the inside.
Rob Kelly:Welcome to Media and the Machine. My guest today is Nic Baird, cofounder and CEO of Koah Labs. Koah is building what Tom Tunguz of Theory Ventures calls the AdSense for AI. Nick breaks down AI token economics in plain English, why serving AI user can cost a 100 times more than serving a web user. That's why he thinks most AI apps cannot reach global scale on subscriptions alone.
Rob Kelly:So ads are coming to AI. The question is whether they'll be useful or terrible. Nick says the best AI ads won't look like pop ups, banners, or pre rolls. They'll be part of the answer. We talk about where people will first see these ads, ChatGPT, Google AI overviews, Gemini, the agents, the apps, outside the frontier models.
Rob Kelly:Nick gives his take on whether Claude can really stay ad free forever. Get into privacy too, how to use these AI ads without creeping people out. And Koah's fundraising story is wild. Tom Tunguz reached out before Koah even had a product after passing on a 150 ad tech companies, and he made a series a decision for Koah in twenty four hours. Nick is also an eight time national sailing champion, and his dad won the America's Cup and is in the Sailing Hall of Fame.
Rob Kelly:So we talk about Nick's scariest sailing moments and how he got to meet Larry Ellison on the world's biggest private super yacht. Special thanks to Tom at Theory Ventures for putting Co on my radar. Please enjoy my conversation with Nick Baird. What do you say to most people who hate ads? You know, I'm pulled in by the awesome chow mein headline, and then I'm looking how to make the beef chow mein.
Rob Kelly:And suddenly, can't get to the ingredients because there's, three ads. You know, the kitchen's hot. My wife's impatient because I'm taking too long to cook. How will GenAI make that whole experience better?
Nic Baird:Yeah. So I think the first thing is it'll rip out all of the, you know, interstitial videos and the sort of banner pop ups and the things that make it really hard to navigate down. Those things are basically impression farming. Right? So that's not what we're interested in doing.
Nic Baird:And the second thing is is that we'll try to figure out why you're on that page. And if we know that you came there from, let's say, you had an agent yourself or maybe that page has a chat experience or some way that you can kind of say, hey, I'm I'm here trying to make this chow mein recipe because I'm trying to make something, know, quick and easy and it's for four people and these are the ingredients I have in my fridge or whatever. The recipe or the model might come to you and say, here's the answer. And then the ads are in the way between you and the answer. So that's the main thing that we're trying to change, is how can the sponsored experience be a part of the solution for you?
Rob Kelly:I know when we last chatted, it felt inevitable or you believe it's inevitable that most of AI will be subsidized by advertising. Can you just kind of in plain English give the AI token economics?
Nic Baird:Yeah. So let's say that in the old world of news websites, for example, or apps, right, you might be looking at a infrastructure cost per user of, let's say, for every thousand page views, it might cost you 1¢ to host those users. With AI, because the content is generated, you have to pay for that generated content via the token costs that the AI models are using to to generate the content. And those token costs can be, you know, one, two, three dollars per thousand page views, as a difference between that and $01 So we're looking at at least 100 times the cost per user for most of these AI based interfaces. So for example, if the user is generating long form content or tons of video or images, it can sometimes cost a dollar or $2 to generate a single video or a single image.
Nic Baird:Right?
Rob Kelly:So if I have it right in the token economics, the AI companies themselves, let's just call it OpenAI, Anthropic, Google, they have such a huge cost for paying for compute. When they're selling access to that compute to the new AI fueled website or app, I'm having to pay for these tokens.
Nic Baird:That's right. And so we're seeing the market basically right now is that everyone that is using these super engaging and super useful interfaces is forced to go into the subscription model because otherwise, it's unit economic negative. And so that's what we've seen in, you know, OpenAI is losing money at an incredible rate. And so this is sort of the inevitability of ads in AI more broadly, but certainly within OpenAI. It's just not possible to actually scale these interfaces globally to a billion plus users and have subscriptions be the primary way that the company is monetizing.
Nic Baird:It has never done been done before. Spotify, YouTube are a couple of examples. You know, ChatGPT's revenue is in the low double digit billions with a billion users or 1,200,000,000 users. You know, Google has twice that number and is doing $330,000,000,000 in revenue from their consumer products. So that's kind of the big difference, right, is that while subscriptions are a legitimate source of revenue, right, even Spotify, which is a subscription business, half of their revenue still comes from ads.
Rob Kelly:Right. So two largest media companies in the world, Meta and Google, both 90% plus advertising. That's right.
Rob Kelly:Tom Tunguz of Theory Ventures. He called you the AdSense for AI.
Rob Kelly:Is that accurate? And can you give background for folks who don't know what AdSense is?
Nic Baird:Yeah. So AdSense is basically Google's off platform ad product. If you see banner ads on different websites like The New York Times, oftentimes that's from AdSense or Google Ad Network. On the mobile side, they have a product called AdMob, which is under the AdSense organization at Google, which basically helps apps monetize via ads as well. And so the idea here is that Anthropic and OpenAI are going to sort of control the core experience.
Nic Baird:But in the AdSense world, the idea was there will still be tons of advertising that happens throughout the web. And if we are bullish on the web as Google was, then we would create AdSense. And so AdSense has acquired a bunch of businesses like AdMob, like DoubleClick, for example. And we're in a similar boat. What we're betting on is basically the distribution of AI agents across the rest of the internet, whether it be mobile devices, on web, on your computer, you know, maybe their voice agents in the future.
Nic Baird:Basically, long tail of the agentic web.
Rob Kelly:How big is AdSense as a business for Google?
Nic Baird:AdSense is about $30,000,000,000 in revenue.
Rob Kelly:And do you wanna be a Google like company?
Nic Baird:There's lots to like about Google's ad business. That's all I'll say.
Rob Kelly:That large? Do you wanna try to scale it to that big?
Nic Baird:I think so. And for example, you know, AdSense is a huge business, you know, on its own would be, you know, hundreds of billions of dollars in market cap. AppLovin is another example of a public market company that, you know, is doing single digit billions in revenue, owning a portion of the mobile market and focus very much on games. The exciting part about the agentic long tail or the AI based long tail is that we think it can basically touch the entire Internet. And we think that the distribution of intent is basically going to get more fractionalized as these agents exist across the web.
Nic Baird:Consumer intent exists everywhere. It's just captured by search most efficiently. And so the one thing while we don't think AI is search, it looks more like search than a display advertising opportunity, for example. And so we think that while we would show up in the areas where you would imagine a display advertisement being, we can extract intent in a much more search like capacity, which should drive higher performance, higher CPMs, and a larger market within the sort of long tail of publishers that host advertisements.
Rob Kelly:So Koah ads would appear on agents and apps?
Nic Baird:Yeah. I think that our vision for this is it shows up anywhere that there's a generative interface.
Rob Kelly:But not on the frontier model LLMs?
Nic Baird:Except for on the frontier. Yeah. They would either not run ads like Anthropic has taken a pretty strong position of not running ads, or they would build out their own internal tools and team.
Rob Kelly:It seems like you're envisioning a new type of ad in the world related to AI. Is that fair to say? Yeah. Can you just walk through how that ad looks, not just on Koah, but in general?
Nic Baird:How does that new type of ad in this AI world look? I think it's important to think about what is different about the AI surface area than other surface areas. And we talked a little bit about the difference in user behavior. We also have to talk about the difference in the content itself. So in an AI environment, the content is being generated, whether that's a chat or a video or an image or whether it actually is none of those things.
Nic Baird:Maybe it's just a generated UI or maybe it's a curation of existing static content. If you have an environment that is generated, typically users engage with that generative environment at two to three x what they do in the static equivalent. If you look at Character AI as a entertainment app, for example, that chat interface has an engagement rate of more than three hours per day per user, which is double what TikTok has. And so what we're betting on basically is that the interface of the future is gonna be much stickier and also more useful. The expectation of users in that generative interface that is much more appealing needs to also be, for the ad formats, generative themselves.
Nic Baird:And so that's really the way we think about it is when the user is expecting personalization on a one to one level, generation of UI, generation of image, generation of copy, generation of content, right, then why would they not expect the same from their ad formats? In a world where all the content is generated, so should the ads.
Rob Kelly:Help folks envision how it looks.
Nic Baird:Yeah. So imagine that you are in an AI chat environment with your assistant. So we might be able to open up, for example, a storefront within an ad format. So think of us as having basically a box underneath or to the side of the AI chat output. And from that, we can do basically anything that we want.
Nic Baird:And so that could be rendering a mini app. It could be rendering a full website. It could be bringing it in a storefront. It could be opening up a different chat experience with a branded agent. But I think the reason why ads feel so disruptive is because they prevent you from getting to the place that you're trying to get to.
Nic Baird:The way to think about this basically is if you're walking down the street and you're going to the grocery store, right, and somebody, you know, pops out in the middle of the street and says, hey, you know, you should come to this, like, jewelry store and buy some stuff or whatever. And you're like, I'm on the way to grocery store. I I can't do this. Like, you know, go away. Right?
Nic Baird:That is annoying experience. Whereas if you subtly are amazing jewelry store sitting on the side and you have this beautiful piece right in the display window that just catches the curiosity of the person walking by, they might say, maybe I'll walk in there because, you know, maybe I'm thinking about buying something for a friend or whatever. And so, you know, I'm curious enough because I've seen a little bit of what I can get by entering this store. And then once you enter the store, you're not so upset about the person saying, hey, what are you here looking for? You know, can I help you at all?
Nic Baird:Can I tell you about this display piece? Now you're happy because you've come in with some interest and some intent. So that's really the way that we think about digital ads as well is how can you invite the user in to the sponsored experience as opposed to shoving it in their face.
Rob Kelly:And for most people, can
Nic Baird:you talk about where they're first going to see and currently would see AI ads? ChatGPT obviously is running an ads pilot. The frequency at which their ads show up right now is relatively low. There's some sort of data leakage around less than 1% of queries within the eligible queries are showing ads. It's only to free and go subscribers mostly in The US and Canada.
Nic Baird:And so for sure, first time you'll see one is that because there's so much press around it. But as a user of ChatGPT, it may be a while before you actually see you know, an ad inside of your experience if you're a free user. But that would probably be the first place a lot of folks would see it. Microsoft Copilot has been running ads for about a year, actually. And so a lot of folks have probably already seen those ads.
Nic Baird:And Perplexity also ran ads starting in November '24. They've since shut that experiment down. Companies kind of pivoting to more of a b to b angle doing computer use stuff. But those would be the most common places. And I would say Google's AI overviews are starting to include some type of sponsored placements that look just like the Google search ads.
Nic Baird:They won't be the type of format that we're talking about, but that would be a place that others would see their first sort of ad in an AI environment as well.
Rob Kelly:I wanted to get your hot take on AI companies and how they're doing in selling advertising right now.
Nic Baird:Mhmm.
Rob Kelly:So ChatGPT.
Nic Baird:Yeah. Doing all the right things. They're very, very early in their products. Their targeting is very sort of simplistic. Their reporting is very simplistic.
Nic Baird:Measurement is gonna be a difficult problem. Formats are very simplistic. There's a lot to build yet, but I think they're taking the right approach.
Rob Kelly:And basically selling ads on the free version, that's what you see for the foreseeable future to help subsidize the rest of the business.
Nic Baird:That's right.
Rob Kelly:Because they need cash. How about Google including both AI overviews and Gemini?
Nic Baird:Yeah. So Google is, you know, as normal slower than the rest. I think AI overviews have some sponsored results that look just like search results. Gemini is starting to have. It's a little bit hard to say whether this is technically an ad or not, but they are bringing in sort of shopping experiences into Gemini, and allowing brands to sort of participate in that.
Nic Baird:The thing is Google makes so much money from the free users. It would never make sense for them to require people to pay for it if they're using it. AI overviews, there is no paid version of AI overviews, for example.
Rob Kelly:But do you see ads being more prominent in Google AI overviews and also Gemini?
Nic Baird:I would say AI overview is the obvious place for them to spend a lot of their efforts, right, is testing inside the AI overviews.
Rob Kelly:And Claude, are they gonna hold out? No ads forever?
Nic Baird:Yeah. I mean, that's the claim. Right? And also, that's what OpenAI said two years ago, and then they, you know, got put under a lot of pressure. Claude is pushing super hard into the consumer space and taking some of the market share from OpenAI.
Nic Baird:And, you know, as we discussed earlier in the chat, Rob, like, I don't think that anyone can go global scale subscription only. You know, it's possible to do it technically.
Rob Kelly:Do you think Claude will have some form of ads eventually, least on a free version?
Nic Baird:If they continue to push into consumer, do. Yeah. I will note on the ad side. Copilot has great ads. People should check it out.
Nic Baird:Their formats are very interesting, more innovative than most.
Rob Kelly:And my friend David Brinker at Character AI, his question was, how are you gonna be the AdSense for AI without reading chats and creeping people out?
Nic Baird:In Google search, we don't mind that clearly Google reads every single one of our searches. Now if we were doing things that maybe we're not so proud of inside of Google, then we use incognito mode perhaps. Or maybe we go to DuckDuckGo or some other type of place to do that type of stuff. And so in that case, you might be really worried if the ads were targeted against the stuff that you were doing in that particular environment. Right?
Nic Baird:So I think that those are the two extremes of what is creepy versus what is not. But if you're in an environment like Character AI where, you know, it's more entertainment focused, people might share a lot of personal information that they don't want to be shared with third parties or really anyone else to be used to target ads against. Right? And so I think this is similar to like Facebook. Well, Instagram ads can be great for discovery.
Nic Baird:They can also sometimes feel a little bit creepy. So for the character example, the way we would do that with them is instead of reading the queries and prompts, right, we would look at the metadata of the of the character perhaps. And maybe we could get as sophisticated as saying, hey, the user is talking to, you know, a character that's trying to help build, you know, a DIY project. Well, in that case, we probably can read the chats and people probably feel pretty good about that. But in the case of somebody who's talking to a virtual character of Patrick Mahomes and talking about like the things that they love about football or whatever, they probably don't wanna see targeted ads in that case.
Nic Baird:But maybe they're willing to say, here's, you know, NFL Sunday ticket. Why? Because Patrick Moen is a football player and NFL Sunday ticket is a football entertainment show. And then I think that's the nuance of of AI ads. Right?
Nic Baird:It's like you have all this data that you have access to. You have to respect users' privacy. You have to follow the law as well. And you're trying to be as useful as possible. And so the question is, like, when does it make sense to read the prompts and get sort of user consent to read the prompts to be able to give the most useful recommendation versus when does it make more sense to do the ad targeting based on things that are a little bit more abstract?
Rob Kelly:I was talking to a friend from the direct response marketing world, kind of a OG of that space, Drew Kossoff. His question was, how should brands think about influencing the model itself versus just the end user? Like, is the real game becoming training the algorithm rather than targeting the customer?
Nic Baird:I mean, is a crazy question, and there's, like, so much to go in this. You know, in the same way that all folks should invest in organic and brand and SEO, like, it's gonna be the same case in the agentic world. The main thing that I've seen successful, which is sort of hilarious because, you know, everyone's like, oh, how do we do this geo, AEO stuff really well? And it turns out that it's just brand. It's just investing in your brand.
Nic Baird:And it's actually interesting you mentioned this is sort of a Doctor, direct response type of person. The direct response people want these, like, programmatic ways to solve things, but I think the market is too early to have a great signal on that. What we've just seen happen time and time again is that the models organically mention, you know, strong brands. And it might be strong in terms of general trustworthiness. Right?
Nic Baird:Like, how many times is it mentioned in the New York Times type of thing? Or it might be very strong brands associated with that particular audience. And so let's say the user says, I care a lot about sustainability. Right? Then, you know, Patagonia might be a great brand for that user because Patagonia has a very clear and well articulated sort of reason for existing and the things that they've aligned their brand around in terms of values.
Rob Kelly:So do you see Gen AI interfaces as being the main interface for using, say, consuming content type products in the future?
Nic Baird:We do. It seems very unlikely to me that we wouldn't have almost all products that we use daily or monthly have some component of a generative interface. And so what I mean by that is not to say that we're we don't necessarily believe that the entire internet is going away or that websites go away or that apps go away and everything just gets rolled up into these single chat based agents and we interact with the whole world via chat or voice. Like, we actually don't believe that's true. We have the saying at Koah within the team that we're very bullish on screens.
Nic Baird:We think that there is a lot of attention that is, like, captured from visual experiences, and people enjoy that. And the chat isn't always the right UX for every type of interaction on the internet. Right? However, we do think that the power of generated content is so strong that while we might today go to a news outlet to see what's going on, we might still go to the same news outlet. We would just expect the portions of that interface that we're interacting with to be generated and personalized to us.
Rob Kelly:On the site itself or through an agent accessing the site?
Nic Baird:On the site itself.
Rob Kelly:Okay. So if I've got a newsletter just for fun on documentaries that I write right now, it's a simple email newsletter. Five, ten years from now, how will my newsletter be different, do you think? Will it have a Gen AI interface?
Nic Baird:Yeah. Or in a very simple way, it would just at least be personalized. Right? So you would at least kind of say, hey, here's what I know about Nick. I'm sending this email out to Nick and, you know, maybe Nick has responded to the email a couple times said, you know, Rob, I really like it when you talk about documentaries about the music industry.
Nic Baird:Like, please talk about that more. And then, you know, maybe you have a bunch of content. You know, maybe the newsletter is personalized to me in that way and it, you know, makes the music part of the newsletter 50% longer than the rest of it because that's what I enjoy looking at. The personalization ability on a per user basis is going to be so powerful and so strong that I would have a very hard time imagining that that is not something that's happening across most of the popular sites, newsletters, apps, experiences across the world.
Rob Kelly:If you look out five to ten years, right now, Google and Meta top in advertising sales. What's gonna be different in five to ten years?
Nic Baird:So I think that AI media will become basically a new category in the same way that retail media became a sort of new category recently. I expect that category to be in the hundreds of billions of dollars of ad spend per year. I expect the big players to capture about half of that and for the rest of it to sort of be distributed across the rest of the web and apps.
Rob Kelly:Your dad was a hall of fame sailor. You got a favorite story about him?
Nic Baird:I think the best story, and he told this in his hall of fame speech, actually, is when I was a a young sailor when I was, you know, 12 or 13. I came in after a very frustrating day of racing, and he was trying to give me some advice and some consolation and say, hey, it's alright. Like, you know, we're gonna gonna learn from this one. It'll all be fine next time. And I kinda, like, threw down all of my sailing gear on the floor, and I was like, dad, you just have no idea what happens out there and just stormed off.
Nic Baird:And he loves to tell that story because it's, you know, classic that that even if you're in the Hall of Fame, you know, and you still have the same relationship with son and dad as many other parents and kids do, which is just sometimes sometimes they gotta figure it out on their own.
Rob Kelly:How good a sailor was he?
Nic Baird:He's one of the best. He was part of the original cohort of people to basically shepherd in the first era professional sailors. He is America's Cup winner, which there are not very many of those. He's won more than a dozen world championships in his lifetime, his first in 1980 and his, you know, most recent one. He's actually won more of them later in life as he's gotten sort of more mature and into larger boats.
Nic Baird:And he's still a very active sailor. So all I can say is that he's been one of the best in the world for his entire career, basically, since he was a teenager.
Rob Kelly:What was it like to meet Larry Ellison, fellow sailor and tech CEO?
Nic Baird:Yeah. I would say I'm laughing a little bit because I have met Larry. In fact, I spent one evening on his at what was at the time the largest privately owned superyacht in the world in 2007 when we were there for the America's Cup.
Rob Kelly:Wait. Did he lose the number one spot? Is he number two now? Or
Nic Baird:I think it's well below number one now. That was twenty years ago. And, you know, this was right around the time that the Saudis started to flex a lot of the money that they were making. And so I believe at the time, it was, like, under construction, something from The UAE or from Saudi Arabia that was larger. But, anyways, I I'm I'm laughing because, yes, I did meet Larry once.
Nic Baird:I was 10
Rob Kelly:years old. Was it due to your father?
Nic Baird:Yeah. So Larry is a very avid sailor and has been part of the America's Cup process or campaigns for, you know, many decades. So he's been a a a big participant in the sport of sailing for, you know, as long as I've been alive.
Rob Kelly:What was your dad's take on him as a sailor?
Nic Baird:So, you know, my dad was always, part of the teams that were competing against Larry's teams. And so I think that the general sentiment was always, you know, fierce competitor.
Rob Kelly:So you won eight national championships in sailing. You're on the Olympic Track. What's the scariest moment you ever had out there?
Nic Baird:Well, sailing is one of those sports where there's a low injury rate, but when things go wrong, they can go really wrong. And so there are at least multiple examples I can give where, you know, I legitimately thought that I was gonna die. Sailing in the bay is probably the most relevant to a lot of people here. When we go out and race in the five zero five now And we're
Rob Kelly:and we're talking the San Francisco Bay.
Nic Baird:The San Francisco Bay. Yeah.
Rob Kelly:And Off Christy Field.
Nic Baird:Off Christy Field, we still do a lot of sailing out there. And when I was early to learning the new boat that I now am more avid sailor in the five zero five is the class, we capsize a lot. But when you capsize in the bay, you know, it's no problem. You can flip the boat back over and get going. But there's, you know, big commercial traffic.
Nic Baird:And so occasionally, know, you capsize and you're like, alright. We got four or five minutes to get the boat ride it and get going. And then, you know, a huge car carrier turns, you know, around the Golden Gate and all of a sudden you're like, no. We got about a minute. Otherwise, we're gonna get run over by a car carrier.
Nic Baird:So let's figure this out. So those are definitely some of the scarier moments.
Rob Kelly:What's more competitive, sailing or an AI startup?
Nic Baird:It's a different type of competition, long term versus short term. You know, I can get way more heated in the moment sailing and get really worked up about, you know, a particular incident. Right? Whereas the AI startup competitiveness is, you know, long term competitiveness. All year, you know, it's sort of like, this month, did we do the thing that we wanted to do?
Nic Baird:Whereas, you know, in sailing, it's more like, you know, this minute that I win. Right? So it's a different type of competitiveness.
Rob Kelly:How hard was it to close Tom Tanguz of Theory Ventures on funding?
Nic Baird:Tom was shocking to us in how fast he was able to move. Some background on the relationship between Tom and Koah, and Theory and Koah, is Tom was actually our first newsletter sign up when we launched our first website. We put the website out, didn't really tell anyone it existed. Twelve hours later
Rob Kelly:Literally the first.
Nic Baird:The very first newsletter sign up.
Rob Kelly:And for those who don't know, Tom, Tom writes an amazing newsletter, which currently is almost exclusively on AI. Wasn't always. And he runs Siri Ventures. And before that, Redpoint was his VC firm, I believe. Yep.
Rob Kelly:So he's the first subscriber.
Nic Baird:He was the first subscriber of our newsletter, and then he reached out shortly after and said, hey, guys. I love what you're doing. I'd love to meet. And this was like, we didn't even have a product yet. So we met with him.
Nic Baird:We told him what we were thinking about and, you know, and, you know, it was too early for him. Right? But he was the first real kind of external person that wasn't a customer or some of our friends that we ever actually spoke to. And he stayed close to the company since then and so followed along with our newsletter updates and our customer updates and emailed and called to check-in once in a while to see how things were going and basically tracked how much success we were getting on the liquidity of the marketplace. And so what was surprising to me is when we were raising our series a, we actually didn't really intend to raise.
Nic Baird:We had a interested party, and they were excited about
Nic Baird:making the deal happen. And so it all kind of came together quicker than we expected. And so we had a deal in hand actually when we met Tom for the first time. And
Nic Baird:we basically told him like, hey, we've got this deal. We're happy with it.
Nic Baird:We're gonna like, you know, go in this other direction. And then basically, Tom was like, give me twenty four hours. And he spent twenty four hours with his team and got fully up to speed on everything that was going on in the entire market and, you know, got to conviction and made a decision and came in and made us a really, really compelling offer, which we were excited about. So that was the interesting thing is, you know, when you ask like how hard was it. I mean, it's always hard to fundraise.
Nic Baird:Right? But sometimes you just have the relationship, and then it makes it really easy to make a decision. That story, we burned another VC that we don't really wanna tell the whole world all that story. Not not because it's like, I don't think we did anything super wrong, but we just don't wanna, like it's a little bit of a touchy subject is all.
Rob Kelly:Did you ever learn why Tom subscribed that first time? What the hook was?
Nic Baird:Tom's background is he was a product manager for the AdSense team. And later when we met with him, he told us that he had met with over a 150 ad tech companies in his time as a VC, and he's invested in zero of them. And the reason was because ad historically has been really hard to break into. The outcomes are hard to argue that the outcomes are gonna be large enough to be really awesomely venture scale. Like, there's a couple billion dollar companies, most of them kind of like couple $100,000,000 sort of outcomes, right, which which is a great business.
Nic Baird:There's nothing wrong with that. It's just VCs love to have the, you know, 10 b potential. Right? And so I think he is, like, mostly curious because of his background. And, you know, he is a big fan, I think, what South Park Commons does as sort of an incubator of different teams and talent.
Nic Baird:And so we were we were members of South Park Commons as part of their fellowship.
Rob Kelly:Do you remember if he was hooked by you calling it the AdSense of AI, or did he come up with that later? Himself.
Nic Baird:Yeah. Yeah. That came later. Mhmm.
Rob Kelly:Okay. So a little mystery as to what initially how he initially found you that first time though, like arrived on your site.
Nic Baird:All I know is that Tom is very technically savvy, and so there is a good chance that at the time had some type of agentic crawler walking around on the websites of different businesses. And it's very possible he signed up programmatically is my speculation.
Rob Kelly:Based on content on the site.
Nic Baird:And the fact that we were an SBC company. So we would have said, hey, here's, you know, 10 So that comes that I wanna pay attention to. Yep. And, you know, I care about companies that are in these industries.
Rob Kelly:Right. Because he's using agents for if anyone who reads his newsletter, he's using agents to do almost all of this work.
Nic Baird:That's right.
Rob Kelly:Yeah. Pinged him once saying, like, that last one really sounded like there was no human Tom involved in his last newsletter, and he was very good at getting back to me. I can tell you're an AI optimist, but what do you think can go wrong AI wise just in the world overall?
Nic Baird:The biggest issue that I see in the near term is kind of like misinformation or sort of like fake videos or fake results or or, you know, influence in the wrong ways. You have people basically using AI to sort of be very convincing and influential. And I would say the second piece of concern, the models are getting so good at writing code that there is a risk of, you know, most software companies sort of getting attacked. And we see this with the newest, Anthropic model, which is, you know, becoming a real issue for, you know, the Fortune 500 brands, for example, and, you know, big finance institutions, things like that.
Rob Kelly:What are you telling kids and younger folks in your life about changes to make in this new world of AI? The biggest thing, I think,
Nic Baird:is now everything is unlocked. You can build things as a nontechnical person. You can try different things. You can know almost all information in the world really much easier because you don't have to dig through everything to find it. You just ask the right question.
Nic Baird:So in that world where building is unblocked, the question then becomes what can you actually do. Right? And I think the most important thing that I'd like to tell, you know, younger folks is just start doing stuff. Just do stuff, build things, put things out in the world, see if people are excited about it, see what people react to. But the most important thing is sort of don't overthink it.
Nic Baird:Find some value you can create. Find some problem you can solve for somebody else and just do it.
Rob Kelly:What do you think about creating an avatar of yourself, for your family, friends, or business even for when you're gone?
Nic Baird:I don't think too much about that. I'm still 28 years old.
Rob Kelly:And finally, was that dog barking in the background Koa?
Nic Baird:That was Koa. Yeah.
Rob Kelly:How'd you get your cofounders to agree to name the company after your dog? It was their idea. Different spelling, though. Right?
Nic Baird:It's a different spelling. You know, we like the name. It's short. It's strong. It indicates the right things, you know, trustworthy.
Nic Baird:We actually did a whole naming convention and tried to, you know, look through a thousand names, and we picked, you know, a couple dozen and then whittled it down and everything. And so we we didn't just say, hey. We've got a dog named Koa. Let's send the company out of that. We actually tried a lot of different things, but we just kept coming back to Koah sounding like a really great name.
Nic Baird:So that's why we chose it.
Rob Kelly:So Koah beat all the names that you paid for.
Nic Baird:That's right.
Rob Kelly:Fantastic. Hey, Nick. Thanks so much for the time today.
Nic Baird:Yeah. Thanks, Rob. Appreciate it, man.
Rob Kelly:Well, this is Media and the Machine. A few things about you and me. If you wanna hear about the next new episode, make sure you hit follow on the show in your podcast app. If you wanna go a little deeper, head to mediaandthemachine.com and subscribe. When you share your email with me, you can see handcrafted transcripts, read the essays in my newsletter, and be the first to hear about who the guest is on the next show.
Rob Kelly:You can also email me directly from there. Maybe you wanna recommend a guest. I'll give you a shout out if you do. I love paying it forward. From time to time, I also open up office hours and host small meetups for subscribers, just to meet, talk, and build things together.
Rob Kelly:And if you're creating something of your own or thinking about it, I'd love to help. Maybe you've got a podcast in you. Finally, I don't have a marketing budget for this show. So if it's finding you and others, it's because someone like you passed it along. I'm genuinely grateful.
Rob Kelly:And if you have a moment, an honest rating helps me make this better for you. You can just go to the show page and click one of the stars. And I'd rather you give me a low rating than no rating at all. I mean it. It pushes me to get better.
Rob Kelly:Thanks again, and see you next time.
