Walmart

**Ben Gilbert** (0:00)
I love how this book is called Made in America, and the Sony story is made in Japan. Like, I don't know who stole from who there, or if it was just the natural title they both chose and didn't even consider it, but it's amazing.

**David Rosenthal** (0:12)
Ah, so, so great.
Is it you, is it you, is it you? Is it you, is it you, is it you?

**Ben Gilbert** (0:31)
welcome to season 11, episode one, the season premiere of Acquired. The podcast about great technology companies and the stories and playbooks behind them. I'm Ben Gilbert and I am the co-founder and managing director of Seattle-based Pioneer Square Labs and our venture fund, PSL Ventures.

**David Rosenthal** (0:48)
And I'm David Rosenthal, and I am an angel investor based in San Francisco.

**Ben Gilbert** (0:54)
And we are your hosts. When we did our Sony episode, we discovered that many Steve Jobs isms really started as Accio-Merida isms. And in all of the research for today's episode, we learned that many of the mental models and quotes ascribed to Jeff Bezos were really the original thoughts of Sam Walton. But of course that is also not entirely true either, since Sam Walton's greatest gift was the ability to digest, learn, adapt, test, and integrate new ideas from others. Today, we explore Sam's creation, which ushered in a new era of American retail and now global retail from the post-World War II period all the way to today. Some astonishing stats on the company. It is the largest by revenue in the world, doing nearly $600 billion a year in sales.

**David Rosenthal** (1:48)
Although Amazon is close behind now.

**Ben Gilbert** (1:50)
It's true. It is the world's largest employer other than public entities like governments employing nearly 2.3 million people around the world. It is still controlled by the Walton family, who owns just over 50% of the business a full 60 years after it was founded.

**David Rosenthal** (2:08)
Oh, we're going to get into how and why that is the case. One other fun stat for you. Today, 90% of America lives within 10 miles of a Walmart. But there are three places where that is not true. And a fourth kind of where it's technically true, but not in spirit. Do you know what those places are?

**Ben Gilbert** (2:29)
No.

**David Rosenthal** (2:30)
San Francisco, Seattle.

**Ben Gilbert** (2:33)
No way.

**David Rosenthal** (2:33)
Boston. And the fourth place is Manhattan and New York City. It is not technically true because there is a Walmart across the river in New Jersey that is less than 10 miles away. But in spirit, that is true.

**Ben Gilbert** (2:45)
What, two and a half hours to get there or something?

**David Rosenthal** (2:48)
Yes.

**Ben Gilbert** (2:49)
Wow. So you're saying it's not a company that is built on the urban core. Is that where you're going, David?

**David Rosenthal** (2:55)
It's the biggest company in the world. It services all of America except where we live.

**Ben Gilbert** (3:00)
Yeah, it's fascinating. This really is one of the most classic business stories in America or in the world, period. And I kind of can't believe that we're not covering it until now. So let's start season 11 with the bang. There are so many lessons that are totally applicable today, and every entrepreneur can learn from Sam Walton. This is a great time to tell you about one of our very favorite companies, Crusoe.

**David Rosenthal** (3:24)
So Crusoe, as listeners know by now, is a clean compute cloud provider specifically built for AI workloads. NVIDIA is one of their major partners, and literally Crusoe's data centers are nothing but racks and racks of A100s and H100s. And because Crusoe's cloud is purpose-built for AI and run on wasted, stranded, or clean energy, they can provide significantly better performance per dollar than traditional cloud providers.

**Ben Gilbert** (3:49)
Yes, we talked about that on our ACQ2 episode with Crusoe CEO Chase Lockmiller.

**David Rosenthal** (3:55)
The other element that makes Crusoe special is the environmental angle. Crusoe, of course, locates their data centers at stranded energy sites. So think oil flares, wind farms that can't use all the energy they generate, et cetera, and uses that power that would otherwise be wasted to run your AI workloads instead.

**Ben Gilbert** (4:13)
Yep. Obviously, it's a huge benefit for the environment and for customers on costs since Crusoe doesn't rely on the energy grid. Energy is the second largest cost of running AI after, of course, the price you pay NVIDIA for the chips. And these lower energy costs get passed on to customers.

**David Rosenthal** (4:29)
It's super cool that they can put their data centers out there in these remote locations where quote unquote energy happens, as opposed to the other hyperscalers such as AWS and Google and Azure who need to build their data centers close to major traffic hubs where the internet happens because they are doing everything in their clouds.