# AI Reshapes M&A, IPOs, and Competitive Dynamics

**Podcast:** a16z Podcast
**Published:** 2026-02-02

## Transcript

We were the largest wholesale funder in the world 10 years ago.
There are a lot of things you want to be the largest in the world.
We got a lot of criticism, but like, why are you raising money now?
What are you?
Stupid.
And it turns out that the best time to raise money is when nobody has money.
Last year, the four largest companies contributed 1% to GDP growth with their $400 billion of spending.
MA and capital raising IPOs are driven by confidence.
For the last four years, whatever the question was, the answer was no.
Okay, now whatever the question is, the answer is maybe.
David, you've been at Goldman now over 25 years.
You know, what are you focused on to position Goldman for the future?
If you're in our kind of businesses, if you're attached to financial assets, this is as sweet a spot that I've seen with AI.
If you have priority data and you have enough GPUs, you can solve like almost any problem.
It is magic.
What if the thing that made software companies defensible for 50 years just stopped being true?
In 1975, Fred Brooks published The Mythical Man Month, which included a simple observation.
Nine women cannot have a baby in one month.
You couldn't accelerate software development by throwing more engineers at it.
That insight shaped how startups competed for decades.
A small team with a head start could outrun a giant because you can't buy your way to a breakthrough.
Fifty years later, something has changed.
Companies are going from zero to more than a billion dollars in revenue in less than a year.
OpenAI built $10 billion business with a seemingly insurmountable leap, and competitors are catching up anyway.
The old playbook assumed that leads compound.
The new reality suggests they might not.
This raises uncomfortable questions for founders and investors alike.
If you can throw money at the problem, what happens to the advantage of being first?
And if incumbents can close gaps faster, does that change when companies should go public or how much capital they need to stay ahead?
A16Z general partner David Haber spoke with A16Z co-founder Ben Horwitz and Goldman Sachs chairman and CEO David Sullivan about how AI is reshaping competitive dynamics, why enterprise adoption is harder than it looks, and what today's policy fights over crypto and AI actually mean for builders.
I've had the distinct pleasure of working, at least indirectly, for both David Solomon and Ben Horowitz, and have a lot of affection for both Goldman Sachs and A16Z.
If you haven't read, I highly recommend reading the book, The Partnership, which is written by a guy named Charles Ellis, which chronicles Goldman's nearly 160-year history.
And I think the most remarkable thing about Goldman's history is the fact that it's not a business built through a series of bank mergers.
Unlike many of its peers, it was really a business built brick by brick by generations of entrepreneurial partners raising their hand, going off and building new businesses, whether it was expanding it to Europe or starting the merchant banking business or the wealth management division, many of these business units became global franchises.
And I'd argue that Goldman was and still is one of the most entrepreneurial financial institutions in the world.
And as I think about where we are in our own evolution at Indries and Horowitz, I kind of like to think that this is what Goldman Sachs must have felt like 50 or 75 years ago.
You know, a small group of entrepreneurial investors betting on the one as rich as you guys.
That's the same thing.
Also, and also Goldman stopped speaking to Sachs like forever.
Like they got very mad at each other over it was at Sachs who supported Germany in World War I.
So you actually remember your history.
Well, yeah.
Well, yeah, small partnership betting on the future with big hopes and ambitions.
I'll leave it at that.
Well done, David.
Thank you.
But maybe just pulling on that thread.
David, you've been at Goldman now for over 25 years.
You joined the firm, I believe, in 1999, just after the firm's IPO.
How has the firm evolved during your tenure?
And maybe more importantly, what are you focused on to position Goldman for the future?
First of all, it's great to be here.
Great to be with everybody.
Before I start on that, I'd just say one of the big lessons I have in my life is if you're joining a new firm, it's a private partnership.
Don't spend six months negotiating so you carry over past the IPO date.
Joan before, June before the IPO.
It's a good lesson for all of you in private partnerships.
The firm's a remarkable place.
And I really appreciate what you said about the firm and the entrepreneurial spirit of the firm.
The firm was for a long time a private partnership.
And the thing about private partnerships is you have this mutual agency where people go off and they do things.
There's some structure that creates a collective each year or each cycle where everything comes back, and then there's a re-evaluation of the partnership shares, and you go off again, you know, into the future to do more.
And that served the firm incredibly well.
And the firm stayed a partnership much longer than any other real Dave Wall Street firm.
But I'd like to say that the firm stayed a partnership until the last moment when it absolutely couldn't be a partnership anymore because it needed the permanent capital to really make it a relevant business.
If the firm hadn't gone public in 1999, it would have missed kind of the global expansion of capital markets and probably would look more like not to pick on anybody, but just to pick it in more like Lazard today than like Goldman Sachs.
And so the stewards of the firm at that point did an incredible job.
I think the challenge for us over the last 25 years, and I think the leadership team over the last eight years has really done an incredible job at this working together to do this, is somehow 25 years after an IPO, we still have this partnership culture.
It's highly aspirational every two years to become a partner of Goldman Sachs.
We have 450 people who really are compensated and a correlation to how the overall enterprise does.
But the big thing that I'm really proud of that is a broad leadership we've done is we've started to recognize that we're not a small private partnership.
And you can't be a public company and not grow and have some form of top-down strategic direction that really gets the whole thing making the one plus one plus one plus one equal more than what the map adds up to.
And that's been a journey and it's been bumpy.
You were there for part of those bumps.
Sure.
But I think we've navigated well.
And I still think principles, the values that we kind of sit upon as a firm, we really strive to be the most exceptional financial institution in the world.
We don't always get there, but we strive for that.
And we really sit on four core values of client service, partnership, integrity, and excellence, try to live it.
And I think the firm's in a really good place.
But in some ways it hasn't changed at all in 26 years, in some ways it's changed, it's changed massively.
Are there a few things you're most focused on as CEO, kind of looking forward for the next five or 10 years?
Sure.
You know, I was a banker and I advised CEOs for a lot of my career, but actually owning the responsibility, it's one of my big takeaways the last eight years is very different than giving advice.
I think the most important thing that a CEO has to do in a big enterprise like this is they have to kind of own the strategy and the direction of the firm.
And, you know, I'm focused on how we ensure we're executing toward growing the firm because I know we have to do that to perform on a relative basis.
But then I'm also thinking about and worrying about big picture strategic risks that can make the firm less relevant, less successful, less important, less competitive.
And for us, I think there are two things that the firm is really focused on.
I think, first of all, one of the things that makes the United States an extraordinary place is we have the most extraordinary capital markets, most extraordinary financial system, the most extraordinary financial institutions.
I would argue that the six most important financial institutions in the U.S.
are all U.S.
financial institutions.
And there is no global institution that can compete in terms of its relevance in the world with the six most important U.S.
institutions.
When you look at those institutions, there are different kinds of institutions.
There are retail banks, more traditional banky banks.
That would include JP Morgan, Wells Fargo, Bank of America, Citibank, but all have global businesses, but they are truly banks in what they do.
They have retail platforms, retail businesses.
And then you've got two institutional firms.
That doesn't mean they don't touch individuals in different ways, but Morgan Stanley and Goldman Sachs are both institutional firms.
And Goldman Sachs is a little bit of an island to one in the context of the way we're positioned as an institutional firm.
And Morgan Stanley is a little bit of an island to one in terms of the way they're positioned.
Scale matters a lot.
And I just went through all those firms.
The two smallest firms of all those firms are Goldman Sachs and Morgan Stanley.
And so when there's turbulence in the world, you always want scale.
Scale in these businesses because they're so mature gives you enormous leverage and latitude.
And so we continue to think a lot about scale.
And we think out five, 10, 15 years, how are we going to maintain a level of scale that makes us competitive?
Ten years ago, it would be unfathomable that Goldman Sachs could have a $1.9 trillion balance sheet.
But at the moment, JP Morgan has a four and a half trillion dollar balance sheet.
When JP Morgan's six, we're going to have to be at least three and a half.
You know, at least three and a half.
And so we have to think about how we can continue to create that scale because these are very mature businesses, and it's hard to really build that scale just purely organically.
So that's one.
Two, funding.
Funding these enterprises is one of the big strategic risks to these enterprises.
These enterprises live on funding and liquidity.
And we don't have a traditional deposit funding platform.
We've got, you participated in this, a very excellent digital deposit platform that now has over 200 billion dollars in deposits.
And we've also, we have about 500 billion dollars of total deposits.
15 years ago.
We had zero.
So we fund about 40% of the firm deposits, but deposits is a much more stable funding source than institutional wholesale funding.
Commercial paper.
Yeah, we were the largest wholesale funder in the world 10 years ago.
There are a lot of things you want to be the largest in the world.
Wholesale funder, not one of them.
And so that strategically is another thing we were about.
So those are big things on stepping back and getting away from the execution day to day and thinking 10, 15, 20 years, which by the way, I won't be here running the firm, but it's still my responsibility here to steward and chart that I worry about that.
The short term, much more focused on technology across the organization, how technology shifts the way we do things, how we're rebuilding processes operating differently while staying true to what we do.
Awesome.
Well, we're here to help with that today, too.
Absolutely.
Ben, maybe transitioning to you.
You and Mark started the firm at an auspicious time in the wake of the financial crisis in 2009.
You know, it turned out to be a really interesting moment because it was, you know, the beginning of mobile and the rise of the cloud.
Well, it's funny also, you know, we got a lot of criticism i in kind of venture capital.
Like, why are you raising money now?
Like, what are you?
Stupid.
Um, and it turns out that the best time to raise money is when nobody has money.
I mean, like it's it's very obvious in, you know, when you say it that way, but uh just the nature of investing is people always want to invest, you know, high and they always want to walk away when the market is low.
And it just is uh is one of those things.
So we we got very fortunate then, I think.
Yeah.
And maybe you can kind of describe the evolution of the firm, you know, since you started and and again, maybe what your ambitions are, you know, for the future as well.
Yeah, so the original idea and in venture capital, like the the fundamental thing that you have to be is you have to be what's known as top tier, because if you're not top tier, then the best entrepreneurs want to take your money.
And so like there are times when you can, you know, when the market is so blazing hot that, you know, you can be like a not important venture capital firm and dump into good deals and make money.
But in most times if you're not top tier, uh you're gonna go to business and um and and so you have to be that and the difficult thing about being top tier is historically the way you became top tier was reputationally, oh yeah if you're Sequoia you had invested in Apple and Cisco and Yahoo and Google.
And so it's really hard to make up that ground if you're starting in 2009.
So the idea we had originally to get to top tier was um to basically have a better product, a better product specifically for entrepreneurs.
So the venture capital product was great for LPs and um but we thought mediocre for entrepreneurs so we designed the firm uh to basically really enable a founder to uh basically build his or her own company um and run it uh as CEO, which wasn't kind of an idea then it the idea was much more to replace the founder.
Um and you know there's a lot that went into it, and because we were founders, we knew what that was, and so we kind of created a firm to give a founder like a brand and power and access and all these kinds of things that VC said they did, but they they didn't have to, because like they were top tier, it didn't matter.
Uh and so we did that, and that's kind of how we got into position to kind of be a long-lasting firm.
The second phase uh was really kind of based on something that Mark wrote in 2011 called Software is eating the world.
And the idea of a software as eating the world was basically uh, if you looked at venture capital up to that point, there were these studies that said in any given year, there are going to be 15, you know, approximately 15 technology companies that get to 100 million in revenue, and those are going to be the companies that are worth money, and nothing else is going to be worth money.
So the whole venture capital sport was how many of those 15 can you get into?
Uh now with software, if software was going to eat the world, though, we thought, well, maybe that 15 is going to be 150.
Um, and maybe one of the features of a venture capital firm is gonna be you're gonna have to be able to scale it.
Uh and none of the, you know, traditionally uh, I remember Dave Swenson, the great Dave Swenson uh RIP saying to me, who was the uh ran the Yale endowment for years, he said, you know, a good venture capital firm's like a basketball team, you know, five, maybe six players, that's it.
Uh but you can't address, you know, a market where you have to be in 150 companies with six players.
So how do you organize?
How do you scale?
How do you design the firm so that you can get to the whole opportunity yet still be like really, really good at investing and not have more than five or six people talking about a deal.
Uh and so that was sort of phase two.
And and that's really kind of, I would say, when we somewhat left the building in terms of um, you know, what was going on in Silicon Valley, uh, because nobody else was thinking that way.
And so this last year, 2025, about 18.
What is it, 18.3% of all venture capital raised in the US was raised by us.
So we're we're now like from tier one to the biggest.
Um and going forward, what I think that looks like is and then I I get a lot of this thinking.
My uh my old mentor was uh Andy Grove.
Um, you know, and it was actually at the end of his life.
But one of the things he said to me that I always remember, and I for for me, for those of you who don't know him, he was uh, you know, he ran Intel, um, he got it through that great memory crisis and and changed the company, probably the greatest tech CEO we've seen.
Um, but he said something that is very obvious uh in a way, but also profound, which was, you know, if you're the leader of an industry, um, then the growth of that industry depends on you.
Uh you have to grow the market.
Like nobody else is gonna do it.
It's not gonna like that that is him coming on you, and he he really took that seriously at Intel.
And so when I think about, you know, what we are as a firm, a lot of it is, you know, it's incumbent on us.
And a lot of the work that we've done on policy for crypto and um things that we're doing internationally, things we're doing on American dynamism, is like how do we win not just we, Andreason Horowicz win, but how does the country win technologically?
How do we uh continue to compete with China?
How do we uh be relevant in the next hundred years like we were in the last hundred years?
And so, and then that drives backwards into how we think about how we have to develop and threesome Horowitz.
Awesome.
Maybe maybe we'll transition just a little bit to tech markets.
Um, you know, David, you know, how would you describe kind of the macro environment?
You know, what are you hearing from the CEOs that you you know work and advise most closely?
Sure.
You know, first, just in and and Ben and I were talking about this.
If um good times.
If you're in um if you're in our kind of businesses, if you're attached to financial assets or investable assets.
Um, um this is, you know, I've been doing this for 40 some years.
This is as sweet a spot um that that I've seen kind of macro picture.
Now, that doesn't mean there aren't all sorts of um difficult, complex things going on in the world, but I think we're at a moment, let's just be here in the United States for a minute.
We can go around the world and talk about anywhere you want, but let's just start here in the United States.
The combination of the significant amount and continued continuing to increase fiscal stimulus.
And by the way, the big, beautiful bill that started in 26 just adds more to that.
It's not that we weren't a very stimulant place, we just added a whole bunch of more.
We have fiscal stimulus, we have monetary stimulus because we're in a rate cutting cycle.
That doesn't mean I think we're going to see many more rate cuts, but we're probably going to see a couple more.
We are in a capital investment super cycle, like something we've never seen.
Last year, the four largest companies contributed 1% to GDP growth with their $400 billion of spending.
Um, we are in a deregulatory um unwind cycle from a massive regulatory surge during the last administration to a deregulatory windback, that is very stimulative.
All these things, it's it's just such a cocktail of stimulus that it's very, very hard to slow the economy down.
And while average Americans definitely feel a lot of stress because everything's more expensive, you can talk about inflation going from nine to three, but the bottom line is everything is 25 to 30% more expensive, and that's the way Americans feel it.
There's pressure, but at the same time, there's enormous financial leverage that keeps the economy going and it makes the economy a little bit more versatile.
And so if you own monetary assets or investable assets, um, if you're around growth and technology, these are pretty, this is a pretty prime environment.
I give you a hundred things that can set it off.
Last April, you know, if you were, if you were in Davos last January, people felt the same way.
And then in April, we had a speed bump, but it was a relatively short speed bump.
I think one of the things that also has there are two things that I think has the market moving ahead.
One, you've got a president that if you look at the speed bump last April, he marks to market to that market every single day.
And the market's going in the wrong direction.
He has no problem adjusting very, very quickly.
And number two, the productivity gains from AI investment and putting it into the enterprise and having the enterprise pick it up, the market is pulling forward a lot of what they expect to be delivered over the next one, two, three, four years.
And so that's a that's a pretty prime macro environment.
Now, geopolitics much tougher.
We're moving back to a multipolar world, and the risk of a geopolitical problem that really slows down growth is just, I'm not saying it's high, but it's much higher than it's been from the last, for the last, you know, kind of 10, 20, 30 years since the wall fell.
And um, you know, look, the world is, the world is fragile.
Social media creates a lot of volatility and division, the way people absorb information, the way information moves, makes the world faster moving, but also more volatile.
Um, and so a lot can go wrong.
But at the moment, from an economic, a base economic perspective, that cocktail of stimulus are pretty powerful.
Maybe a follow-up question for for both of you.
I mean, uh, you know, do you expect to see a lot of MA or IPOs this year?
How are you sort of advising your CEOs?
We have a lot of them in the audience.
It's a good banker response.
Just just fact base.
Okay, fact base.
We had you had a very, very tough regulatory environment.
MA and capital raising IPOs are driven by confidence.
And so if you have a tough regulatory environment, that is something that affects confidence.
From an MA perspective, on strategic MA, for the last four years, whatever the question was, the answer was no.
Right.
Okay, now, whatever the question is, the answer, even if it's very, very significant, the answer is maybe.
So what do C CEOs like to look forward?
They like to do big things.
They want to, and so there's there's a lot of activity.
Fact.
And so I I just think again, this is an environment where you're going to see a significant.
I think this could be the biggest MA year.
This is just me predicting, I think it could be the biggest MA year in history this year.
It's gonna be a bigger IPO year reason.
But you'll you'll have a view on that too.
Now I could be in a public company is a horrible thing.
I drew my record.
Do not wear.
It is challenging from times.
You just have to be okay with getting sued a lot all the time.
Um you know, it's funny.
We we had a company that just went public, and they're like, we might get sued.
I was like, of course you're gonna get sued, you're public.
This is America.
Like, what are you talking about?
Um I agree, I agree a lot on on the MA front, except we'll with the uh kind of exception that like it's not clear uh the FTC's uh kind of position on these things yet.
And so far, I mean, yeah, especially on big tech, even on like small tech, they've been very, very aggressive.
Um so I think MA will happen, but it may happen more in the form of the IP transactions and that kind of thing than as uh traditional MA.
Um, I hope not, but but that that may be the case.
And then yeah, like I I think there's gonna be a lot of IPOs coming out of our world.
So I think there's gonna be somehow a necessity, the the companies are growing so fast.
We have so many companies uh like went zero to over a hundred million dollars in less than a year, um, some zero to over a billion dollars in less than a year.
So we just like we've never seen that before.
And uh and then the kind of corollary to that in AI is that um leads aren't what they once were.
So for my whole life in technology and for the whole history of software, there was this thing called the mythical man month.
And the way the mythical man month were, where you know, nine women cannot have a baby in a month.
Uh and so you can't just, if you're Google, you can't just put a thousand software engineers on a product and wipe out a startup because you can only build that product with, say, seven or eight people.
And once they've figured it out, they've got that lead, and you're gonna have to, you know, you're gonna be behind for a long time.
That's not true uh with AI.
Um so with AI, uh if you have data, you know, particularly proprietary data, and you have enough GPUs, you can solve like almost any problem.
It is magic.
Uh, but it means that you can throw money at the problem.
Uh, and we've never had that in tech.
And so I think that that's actually going to drive a lot of IPOs because people are going to want to get out and have the capital to continue to compete uh because it's really necessary.
You don't just have a lead you can sit on.
Uh so it's going to be a very exciting year, I think.
You you were talking about the FTC earlier.
I know you and Mark are spending a lot more time in DC than you ever have.
Um, you know, what are some of Chris and Chris?
Yeah.
Um, you know, what are some of the policy uh you know agendas you're most focused on?
And and why do you think this is you know more important now than it's ever been?
Well, the first one was crypto, because um, you know, we we thought then and we continue to think crypto is an extremely important technology.
Um it's kind of uh, you know, not not just the kind of most profound breakthrough in kind of financial technology that we've seen, but uh a real breakthrough in um just how society works.
So everything from, you know, how do property rights work on on the internet, you know, like uh, you know, how what what is the right architecture for things that were uh creatives um contribute most of the value?
What's the right business architecture?
What is stakeholder capitalism really?
Um, these are all things that that get solved with crypto.
So we thought it was so important and so important for the advance of society to not have us like descend into communism and these kinds of things.
Uh and it got completely banned by the last administration, but not through a legal process, not through a legislative process, but just through like sheer will and you know, we'd say abusive power of the of the government, including techniques like debanking where a company wells notices, um, which I've never seen before in a private company.
So just an attack from the government on uh uh an industry, uh technology industry in this country.
And so we were like, well, we've got to get in and work on that.
And um, so the first thing was the uh Genius Act and the stablecoin bill, which passed and is now a law, and we're very proud of that.
The second one, which we think is the more important bill, is the Clarity Act, which is also known as market structure, which um kind of establishes, and it's such a necessary thing for this technology because you have these tokens that can represent Pokemon card, that can wreck represent a stock certificate, that can represent a dollar.
And there were no rules to say, well, which one is this token?
And the approach of the Biden administration was everything's a security to the point where they sued artists for like, oh, I painted a picture and I made an NFT.
Oh, you sold the security.
Like that, that crazy.
So this one we're trying to get past right now.
Um, and uh we've had some drama around it, which I'm not going to comment on, but uh that's a thing.
The second one that's really important is AI.
So uh, you know, like with uh I think with the automobile or with electricity uh with these two technologies, people uh kind of freak out about them because they they do have big impact, they are going to change the world.
And with AI in particular, uh, you know, there's some of the calls are coming from within inside the house where people are really trying to kind of scare the population, sometimes to achieve regulatory capture and other things.
But if you ban the technology, which some people are calling for, uh, or ban or kind of infringe people's ability to do mathematics, which is something that a lot of people are calling for, um, then I think we're definitely gonna lose the AI rights to China, which has like massive, you know, hundred-year implications.
Uh and so the key things we're trying to protect are one the model is the model.
It is a model, it's a mathematical model, it predicts things.
It's not like a uh sentient being, like maybe we'll figure out how to do that.
We don't know how to do that yet, so it's not sentient.
Um it's just a model.
Uh so we're trying to say don't regulate math, um, regulate the applications of that math.
So if somebody uses AI to break into a bank or um, you know, steal your money or uh, you know, make a robot that that uh shoots somebody, then that's illegal.
Um, but the technology itself shouldn't be illegal.
Uh and then there's uh the the kind of most pressing one right now is um every state wants to have their own set of AI laws, which will basically make it impossible for new companies to innovate because you can't comply with 50 different laws from 50 different states.
So we're trying to get that done.
Um kind of shortly following that, there's an issue of how copyrights are treated.
Um, and can you build a statistical model over copyright work, not reproduce the copywritten work, but just build a model about it so that the kind of software becomes smarter.
Um we think that's very important because China absolutely doesn't respect copyrights, even they don't respect just copying it, uh, let alone building a statistical model, and we're gonna have kind of a weaker uh AI if we can't train on all the data, can't train on the complete data.
So those are the main things that we're trying to push for.
You know, one of the things that was very evident to me during my time at Goldman was how you know client-centric the firm was.
And uh I know OneGS was a big kind of focus of yours.
Um I'm curious how AI is changing the way you guys both work internally and also how you're delivering, you know, better for clients.
Sure.
Well, the the the I mean firm is the firm's business is serving our clients.
And so I, you know, I technology has for decades and decades and decades been making productive people more productive.
Goldman Sachs is a professional services firm filled with productive people that are very productive, and technology has been changing the way they work, evolving the way they work, making them more consequential, allowing them to expand the scope and the footprint of what they impact.
Um, and you know, this technology is another acceleration of that for sure.
Um, you know, in the in the simplest form, and and this is a a broad oversimplification, so please take it as such.
There are two things that we're focused on.
One, we've got lots of smart people.
These are tools and applications.
We're trying to get them into their hands and give them access to them and access to models and access to applications, um, so that they can experiment with them, play with them, figure out how on a day-to-day basis, as they're executing for clients and doing the things they're doing, they can be more productive, more powerful, have more impact.
Um, we're good at this.
We've done this before.
Our people are good at it.
It takes time, but we we know how to do this and we're doing it.
And you know it's really constrained by how we get the best tools, the best models, the best applications, get them by the way, regulatorily cleared because we have to deal with regulatory constraints and everything we touch and we do.
And that's a huge barrier for us.
We're just not a company that can say oh this is great, let's try it.
We have to have a huge process before we can try anything.
But we know how to do that.
We're doing that.
And that is that is expanding the productivity of our people and and you see real-time uptake on that it's really accelerating.
The more interesting thing to me as the CEO is that this technology allows us to really look at fundamental operating processes on a massive enterprise and completely reimagine them to automate them and make them more efficient not just simply for the benefit of doing them with less people or with less costs, but for the benefit of taking some of that savings and giving us more capacity to invest in growth areas of the business where we're constrained.
And so we don't have the ability that could just spend as much money as we want and lose as much money as we want.
We actually have to be held accountable every year to how much money, how much money we spend and how much money we make and what kind of a return we generate.
Those tanks abilities generally don't last forever.
No, they don't last forever.
But they actually, interestingly, there are companies that have proven that they can last for 10, 15 years where the accountability on the way you're deploying your capital is put off for a long period of time.
We have to look at it every year.
So I would say in the last few years, we've been constrained, just simply we spent last year, we spent six billion dollars on technology.
I would have loved to spend eight.
Okay, but if I spent eight our returns would have been hundreds of basis points lower.
And you know what?
We couldn't do that.
Sure.
Now if we can actually find $2 billion of efficiency around reimagining processes, then I can spend eight and wind up with the same returns.
So we we laid out we actually called it 1GS 3.0 a program where we picked six specific processes in the firm and we said we are going to do the work to really completely reimagine them.
We have not put out publicly how that changes workforce, how much capacity that creates, but it's super significant.
And it's not that there are only six these are just the first six.
So this is one of the reasons why the market's running forward.
I think this opportunity is huge, but this is hard.
This is hard because you're asking people to go kind of take away their empire and do their empire differently it's got to be driven top down and uh and it's hard but we're gonna we're gonna make a lot of progress.
And so there's a two simplification but those are the two big things what I like to say.
Anything, Ben need to you'd add to that.
And just where you sort of see the proliferation of this technology in the enterprise, and or what are you most optimistic for in the next I don't know, five to ten years?
Well, I think that for kind of the reasons David cited, like we're at the very, very beginning in the enterprise.
Um, you know, like changing people and processes and so forth in a in a big existing company is the no matter whether the technology is this complicated.
Um, in our firm, as you know, uh we are kind of taking a very aggressive approach to kind of first automating all the things people do and don't like to do, or you know, it's not like the funnest part of the job.
We've also kind of gotten all of hard data in a Databricks data lake, and so we can ask, you know, basically any question about the firm or the portfolio customer sport was fantastic.
You know, AM AI agent investing could be very, very interesting because you know, models work on the facts that are available.
And one of the things about investing is sometimes the biggest changes and the way you have to think about investing in a portfolio comes from things that are completely new and unexpected.
It can't be incorporated in a model be based on thing from the past.
Yeah, can't be something for passes.
So the bottom line is once it happens that it can't be quickly incorporated, models and models can move very quickly, but still, you know, you start from a place.
And so it's I I'm I'm really interested to see how it works.
And what one of the things you've got to, you've gotta wonder why there are a handful of people.
There are a handful of people who have so outperformed as investors over a long period of time, but you encounter them in handfuls.
Generally speaking, you know, people underperform.
And so if the models are based on the information that the people are underperforming all have, it's gonna be interesting to see whether something different comes out of it.
Awesome.
I think we're running out of time, but um maybe one last bonus question.
Um favorite DJ.
No, no self-nominations.
Favorite DJ today?
Yeah.
Or it could be in the past.
John Summit.
John Summit is John Summit is doing really really cool things as a DJ.
He's an incredibly interesting young guy that's got a lot of energy and he's he's evolving very much the context of how kind of big club house DJs do what they do.
I think I think he's doing a great job.
And I'm gonna stay in my lane, which is the past.
And hip-hop DJs, I don't want to say DJ Jazzy Jeff.
Um who ASA.
Like very underrated because his uh partner, the Fresh Prince, became Will Smith.
Um, but DJ Jazzy Jeff is uh great, great all-time ZJ.
Yeah, awesome.
Thank you guys so much for hearing us.
Thank you, David.
Awesome.
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