DeepSeek AI Demands Investors Don't Poach Employees -China Building Tech While USA Builds Bubbles

[00:00:00]So, coming from CNBC, quote, "No poaching our people, China's AI behemoth, Deepseek, reportedly tells investors."

[00:00:12]So, I kind of think this is interesting.

[00:00:13]We talk about the technology world, especially the AI world. One of the things that I find curious is culture mentality, especially kind of the difference between cultural mentality in the United States and other places like China and how curious our cultural mentality here in the US is. Uh I've noticed this especially over the past 10 or 15 years, how we fetishize uh founders, right? You know, I hear this, you know, from from so so many people out there, right? You need to go out and become a founder.

[00:00:45]And I don't really understand why. As I've said many times before, most most startups fail miserably. Most businesses fail within 80% of businesses in the United States fail within the the first uh two years. And so realistically, if you want to be successful in the US uh as a technology professional, probably the one of the best ways you could do that is get as many qualifications as you can, get the best job that you can and then put as much money as you can into the S&P 500.

[00:01:17]If you optimize for your paycheck and you put as much money as you can into the S&P 500 index fund, at the end of the day, you are going to be be better than 99.999999999999% of all startup founders out there.

[00:01:35]Right? That is that's the little thing that the the investor class and the startup world doesn't want to talk about. And so what's really interesting here in the US is there is such this fetishization of startup founders. So basically one of the big problems you can have if you're running a technology company, if you're running a startup is you get the technology company going, you get the startup going, you get the customers coming in, you get the products going out, you're actually getting revenue, maybe maybe you're getting a profit. And the one of the big problems is the best employees that you have, they are likely to be told by your supporters that they should go off and create their own companies, right? So think about this with investors. Investor the way that startup investors or or investors that invest in the startup ecosystem really make their money is it's kind of a shotgun effect. They invest in a lot of different companies. The idea is one or two of those companies is going to be a home run. it's going to be a Google, a Facebook, a SpaceX or whatever else. And most of them are most of them are going to fail, right? So the way to be really successful in that particular game is you get as many people on the board as possible, right? You get an in with as many startup founders and as possible, support as many as possible so so that you optimize for the chance that you're investing in that SpaceX. And so that that that's an interesting dynamic there. And it's an important thing to understand as a startup founder is your investor's priorities most of the time do not align with your priorities. As I've said before, distrust, verify, stay suspicious and keep them keep them away.

[00:03:19]Keep them away type of deal. And so one of the problems you can have right in our in our technology landscape is so many times even the investors in companies uh they're actually promoting to the employees of the startups they're investing into hey have have you have you thought about creating a startup company? Have you thought about possibly working for this other startup company?

[00:03:38]Right? And that can cause a lot of issues. And so what Deepseek is doing right now, they're going out, they're getting investors and they're like, "Stop.

[00:03:47]If you want to invest in our company, you cannot try to take away our staff.

[00:03:55]Stop talk telling them about being startup founders. Stop stop telling them about the other companies where they could be making more money or whatever else. If you're going to invest in our company, actually support our damn company. And uh yeah, it's just one of those things to kind of put on the table and realize, oh, you can you can do that. You or at least you can try to do that. We'll see how it goes.

[00:04:17]China's Deepseek has a precondition for its uh $7.4 billion maiden fund raise, no poaching the AI labs talents. Uh during a 4-hour virtual meeting with prospective investors in May, founder uh told uh participants on the call that a condition of investing in Deep Seek was a promise not to poach the startup staff or encourage them to start their own companies. And that's the bigger problem, right? But poaching the staff, that's a bit day class for anybody. Not that they don't do it, but it is day class A. The bigger problem is this whole idea of like, hey, have you thought about creating your own startup company? Look, we could invest in your startup company, right? And then that then that drains their staff. Uh the unusual talent poaching condition underscores how the contest among Chinese tech giants to build advanced AI and eventually AGI has tipped into open competition for engineers. Deepseek reportedly closed its first external funding round this week, which valued the uh the company at more than $50 billion and made it China's most valuable AIon startup. Oh, think about that. $50 billion. And that's their most valuable AI only startup. The startup uh which had turned down outside funding since its inception to focus on research instead of commercialization sought the latest fund uh fund raise after losing a number of key researchers to rivals. And so that's going to be a big question here like like a Deep Seek or whatever.

[00:05:40]If they're doing so well, why are they doing this fundraising round? And basically the issue is is with investor money, you can pay your engineers more.

[00:05:48]One of the big problems we have going on in this whole AI fraud right now is there's so much investor money out there. These companies get the investor money and then they throw the the investor money at AI engineers. And now now here's the here's here's the deal, right? You get hired by this AI company, let's say $500,000 a year. this other AI company over here basically doing the same crap, basically doing the same crap, then offers you $750,000 a year.

[00:06:14]Okay. Well, you jump over to that company and then another company offers you a million dollars a year, then you jump over to that, right?

[00:06:19][clears throat] If people are going to be offering you like a lot more money to basically do the same job, you're going to jump to other places. One of the big problems a lot of these AI companies have, right? Even and this this is a problem with the AI fraud. This is the problem with the AI insanity that's going on right now is even if a company is trying to be reasonable, even if a company is trying to be smart, they can actually be killed for being reasonable and smart. Right? Look, we we we are going to focus on revenue. We are going to focus on profit. And so we we are going to pay commiserate with with a reasonably successful technology company. Right? You're not poor. You're not poor. I'm not saying you're g you're gonna be living in in an efficiency apartment. I'm not saying you're gonna be running you're gonna be driving to work in a Chevet or anything, right?

[00:07:08]You're gonna have a nice car, right? You you can have a a a lowgrade BMW. You you can have an apartment in like in the really nice uh in the nice uh apartment building. Maybe not the penthouse, but but maybe in the middle floor, something like that. But the problem is is even when they pay well, even when they pay an amount that should be reasonable, if all these other companies out there have more money, then then your talent's going to get poached. And so Deep Seek is out there. They're they're trying to get more money so that they can pay their engineers more so hopefully their engineers don't leave and they don't want their own investors to poach their [snorts] own employees. And I think that's the thing here like the big the big takeaway from this particular article if you're a startup founder whatever else is to realize most of the time investor and founder priorities do not align or they don't align necessarily as well as you think they align. Right? Again that's a big thing here with this whole poaching. Right? If a if an investor is investing in you, you wouldn't really think about them trying to poach your employees. Right?

[00:08:16]Okay. you're you're you're buying equity in my company so that we can be successful. Wh why would you try to strip away my most valuable employees?

[00:08:26]Well, because in their in the game that they're your game is about shipping product, increasing the value of your company. Their game is about increasing the number of startups in the field with hopefully one of them becoming the next Google. So even even when they want you to be successful, that doesn't necessarily mean they align in the ways that you think they do. The other thing too, and again this is a big thing to be thinking about with this fetishization of a startup culture is this is something that you might want to think about trying to quash within your organization. One of the things that I find very weird. Look, I have been a tech entrepreneur since [sighs and gasps] two 2001 2002, right? I even I even went through an entrepreneurship program when I was in high school. My vocational program in high school was entrepreneurship. Uh, DECA, Distributive Education Clubs of America. Literally, in my senior year, I would go to the local mall to have our classes inside the JC Penies, right? But here's the thing. Here's the thing. [snorts] Entrepreneurship isn't for everybody, right? Founder life isn't for everybody.

[00:09:35]There is this there's this weird mythology, right? to be a real technology person, you need to be a No.

[00:09:43]No. Because because when when you're a when you're a founder, right, not only do you have to worry about about the technology, not only do you have to worry about terms of service and things, you also have to worry about Quickbooks.

[00:09:55]You also have to worry about talking to the lawyers. You also have to worry about facilities. You You know what it's like to be highly educated, highly trained, respected for what you do, and you're trying to figure out why the toilet won't flush.

[00:10:09]Yep. Life a startup founder.

[00:10:13]I told you I'm my MCSE and my college degree and I got my RV experience anyways, right? And so that's something to kind of consider, right? Is how many how many employees are technology companies losing here in the United States or anywhere else, startup companies, right? good, valuable employees that could do a lot for the company, but they but they're running off to greener pastures because for some reason they they think they're going to be the next Mark Zuckerberg. That might be that might be something that you want to kind of quash in your organization.

[00:10:43]Hey, have you all heard about S&P 500 index fund? Have you all heard about the magic of compounding interest or compounding returns?

[00:10:55]It's amazing. even better than blockchain.

[00:10:59]So anyways, what do you think about this? What do you think about deepseek the moon doing that their investors not poach their talent? Oh, if if that does if that does not if that's not kind of the metaphor for the world of technology, I don't know what is. What do you think about this with uh with Deepseek, right? We hear a lot about DeepSeek. Apparently pretty successful.

[00:11:20]Apparently a lot of people are using DeepSeek. Think about this, right? This is an AI model company and it was valued at $10 billion less than Cursor. So SpaceX just bought Cursor for $60 billion. An AI IDE got valued at $60 billion in the United States. An actual model creator in China got valued at $50 billion. What do you what do you think about that that disparity in, you know, basically value there? I don't know. Put your thoughts down below. If you like these episodes, do remember they're on Spotify and on Apple Podcast. Link is down below. If you want to follow me on LinkedIn, there's a link down there, too. with that. See y'all