Disney+ Arbitration PR Crisis, Good vs. Bad Startup Sci-Fi Ideas & Defence Tech Rise with Shiyan Koh - E464

Shiyan Koh, Managing Partner of Hustle Fund, and ​​Jeremy Au talked about three main points:

1. Disney+ Arbitration PR Crisis: A woman died from an allergic reaction after eating at a Disney-affiliated restaurant. The husband sued Disney for "wrongful death" and $50,000+ of damages. Disney in May 2024 alleged that the husband accepted a forced arbitration agreement when signing up for Disney Plus in 2019. This caused a firestorm of public criticism about the company's accountability. The hosts discuss the broader implications of such legal strategies on public trust and branding, and Disney's withdrawal of this legal case serves as a cautionary tale about balancing tactical legal defenses with keeping a broader strategic eye.

2. Good vs. Bad Startup Sci-Fi Ideas: Shiyan stressed the importance of personal dedication to a business idea, given the substantial time commitment involved. They also explored how sci-fi plays a role with simultaneous innovation, the concept of "founder-problem fit" and the critical need to align personal interests with the entrepreneurial venture. They also discussed the suitability of ideas for venture capital investment, distinguishing between good business ideas and those that are venture-backable.

3. Defence Tech Rise: Jeremy discussed the role of startups like Anduril and Palantir in transforming defense technologies. YC-backed startup Ares Industries is producing cruise missiles that are 10X cheaper and more effective than existing models. Private sector innovation is increasingly crucial to government budgets looking to buy large volumes more cost-effectively.

Jeremy and Shiyan also touched on topics like longevity and sleep quality, biohacking amongst tech enthusiasts, and the importance of market validation.

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(01:50) Jeremy Au:

Good morning, Shiyan

(01:51) Shiyan Koh:

How's it going, Jeremy?

(01:52) Jeremy Au:

Good. Finally got eight and a half hours of sleep. So I finally caught up on it.

(01:56) Shiyan Koh:

Ooh, gosh. Do you have an Oura ring? Did you get crown?

(01:59) Jeremy Au:

Oh, what? Do you get a crown?

(02:01) Shiyan Koh:

Yeah, it rates your sleep and then you look at the app. So every morning my wife is like, did you get a crown? And I was like, no, crowns are very rare. Like sometimes it'll say good job, but it doesn't give me a crown, and you're like, come on. I was so close. so yeah.

(02:13) Jeremy Au:

You're making me feel old school because it makes me remember Fourquare where you could be like mayor of a place if you checked in the most number of times, last amount of time, you get a little crown.

(02:22) Shiyan Koh:

Yeah. Yeah. But yeah, so I can see my sleep quality. I've been tracking it for like a little under a year. Definitely late workouts don't help me, so I have to work out in the morning and not at night. Temperature really impacts my sleep, like if I'm too hot, I don't sleep well. Eye mask, like you're tracking all these variables basically. Obviously, drinking makes your sleep quality worse. Eating too close to your bedtime makes your sleep quality worse. Yeah, stuff like that. Hot shower helps the sleep. Sorry, we don't have to do a sleep episode. This isn't like some Peter Attia thing or whatever. This is a tech podcast. Let's talk about that.

(02:55) Jeremy Au:

No, I mean, there's all kinds of tech stuff. I mean, we have the longevity conference coming out by Bryan Johnson. "Don't Die", that's coming up in about a month. It's the same month as TOKEN2049 and SuperReturn and F1 Race.

(03:06) Shiyan Koh:

Camp Hustle.

(03:07) Jeremy Au:

And Camp Hustle. Don't forget those two tickets. Hashtag plugged.

(03:11) Shiyan Koh:

Yeah. Yeah. You know where you're going to sleep well? In Bali. Camp Hustle.

(03:14) Jeremy Au:

Yeah.

(03:14) Shiyan Koh:

Hang out with me. That's right.

(03:16) Jeremy Au:

And then you go to this longevity sleeper. So you're like, and time to begin your sleep routine. Three, two, one. Yeah. I think it's been definitely an upcoming month of conferences. I wouldn't say longevity is bad. And also every techie is into this biohacking and optimization.

(03:31) Shiyan Koh:

Yeah. It's an interesting question. It's always like, what are the big levers you can move? Do we all need to take a hundred pills a day or can we just try to focus on cardiovascular, like move your body, try to eat healthily and sleep. Those are the big levers before we start transfusing the blood of children into our veins. You're laughing, but that's what he did!

(03:52) Jeremy Au:

Yeah, he did. He did. Bryan Johnson did do that several times, but he did stop because he felt like he measured it and he felt like there wasn't much of an improvement. So it's no longer continual activity. Well, I do have to admit, I do have to admit, I'm like writing this podcast reflection, I guess, a diary, but I am part of this rejuvenation Olympics. So it's like this leaderboard of aging that's spearheaded by Bryan Johnson, the doctor, and I just did that test just for fun. And it turns out I'm ranked 252 for the rate of aging which is obviously a,

(04:22) Shiyan Koh:

Out of how many?

(04:23) Jeremy Au:

I think tens of thousands, but, obviously it's a very self selected group, because firstly, it's all biohacker-ish. Two is you could access this test, which is primarily available in America. You had to ship it in America. And then three, of course, is you pay the money to do this test, but yeah, supposedly I'm like aging pretty slowly. But there's a one time test as well. I don't know. I did do it after a very nice long holiday, effectively of three months. So I was like, in terms of, you asked about what the routines were optimal.

I was just like on holiday. I had no stress. I was with my kids. I was getting some exercise. I was eating very healthy. So I don't know. So supposedly I'm like, if you go on the public leaderboards you're like, Oh, Jeremy, I mean, by now I'm probably like bummed downwards by the time you check this thing, but supposedly, I'm like aging a 0.8 something. So it was like every year I'm like saving on one year of aging. I don't know. We'll see.

(05:08) Shiyan Koh:

Proud of you, Jeremy.

(05:09) Jeremy Au:

I know. I probably destroyed my body, now that I've gone back to work and just feel like sleeping erratically running all around the place. Oh, well. So, we saw recently about Disney and our Disney plus lawsuits.

(05:21) Jeremy Au:

So the story of was basically like somebody's wife died and he wanted to sue.

(05:26) Shiyan Koh:

Well, of an allergic reaction, right?

(05:28) Jeremy Au:

Yeah.

(05:28) Shiyan Koh:

She was really allergic to nuts and then they served her something with nuts.

(05:31) Jeremy Au:

Yeah. So, horrible tragedy, and so he's obviously suing for damages and I think there's a case to be made, et cetera, but I think the part that made it viral, of course, was the fact that the Disney defense pulled out this disclaimer and said that she signed the Disney Plus which argued for no lawsuit, which is arbitration, right? She signed up for the account. And then he didn't have the right to sue because of that clause.

(05:53) Shiyan Koh:

I mean, the whole thing just makes Disney look terrible right? So even if it is technically true that the mediation clause is still in effect, which I don't know, questionable, right, since it was signed many years ago, there's the, "is this really the look that Disney wants?"

(06:05) Jeremy Au:

Yeah. It's tough, right? And I think also it was like, she signed it, not him. And he's the one suing blah, blah, blah. Anyway, it's very complicated, but basically I think the internet went viral for the memes about saying like, Hey, I signed up for Disney Plus to watch Little Mermaid and I threw away my legal rights.

(06:20) Shiyan Koh:

It's mad.

(06:21) Jeremy Au:

It's a bad PR look for sure. Well, I think Disney has cancelled that defense structure. So I'm pretty sure Global Disney HQ, and especially marketing pulled out the headlines as like, FML, and then they called the law firm, and the law firm called the junior person who thought it was a very good defense rationale. Or it was not a junior person. Obviously, a legal partner signed off on that, but you know, I can totally imagine one arm not understanding that it's like, this could go viral.

(06:44) Shiyan Koh:

All right. So what's on the docket today, Jeremy? What's burning a hole in your mind?

(06:48) Jeremy Au:

So obviously these lawyers thought they had a good idea and it turned out to be a horrible idea. And one way that you and I have often gotten a lot of questions about is like, is this a good idea? What is a good idea? What's a bad idea, because there's a lot of founders who are like, I guess, pre-founders who are thinking through, brainstorming. And even at a C stage, you're still figuring out that idea stage, So I'm just kind of curious, what do you think about, any advice or thoughts about that?

(07:10) Shiyan Koh:

This is a very long discussion that we could have. I have a lot of thoughts about this. I think one, one One thing I find myself saying a lot to founders is, they'll ask me, is this a good idea? And I ask the question back to you because you're the one spending your time on it. So you're the one who's incurring the opportunity cost of working on this idea, which is like, is this something you want to spend 5, maybe 10 years of your life on? And I think there's a couple of dimensions to that, which is, do you actually have personal interest in this idea enough that's going to sustain you through a bunch of shitty portions of building a company, that you wake up in the morning, you're like, "Oh, I got to serve these people again?" Like, I can't stand it, or like you wake up and you're like, "Oh, I am still really interested in solving this problem. This problem matters to me, these customers that matters to me. I want to do it." So is there a founder-problem fit, first of all.

And then I think there is this sort of back to this opportunity cost question, like, is it a big enough opportunity? Is the potential eventual payoff actually worth it for the time that you're spending doing And I think there's a bunch of ways to think about that. And then I think there's like, is this a good idea, is this a venture-backable idea? And I think there's lots of ideas that actually are perfectly good businesses that are not necessarily VC-backable businesses. And I don't say that in a bad way. That's not a bad thing. That's just like, there's different return curve shapes, and some things fit that and some things don't. So I think you need to sort through those things in your head as to, if everything goes right, what's the outcome that I want? If the outcome is, I've solved a problem I really care about, I have a sustainable business, many things can fall into that, right? If the outcome is I want a venture scale outcome, that's a different subset of problem categories and we can sort of like talk through how you might think about that. What is your answer, Jeremy, when people ask you, is this a good idea?

(08:51) Jeremy Au:

I often think about history and sci-fi because I love both of these topics. And they're both like stories of the same thing, which is the arc of human history. I think history is full of ideas of simultaneous innovation, which is that two or three people around the world in totally different parts of the world make the same discovery around the same time, independently. And the reason why is because the right things came to place, right? The right technology, the right understanding, right framework. So the idea that came to existence, whether it's like antibiotics or the telephone, et cetera, they all got invented around the same time.

On the other end of the scale is your science fiction, where we have all these writers dreaming of the future and saying like, knowing what I know about today and the human life, what would we really want to have on demand? Like, we would like to have driverless cars because nobody likes driving. We're going to live forever because nobody wants to die. We have wars done by robots because everyone wants to kill without being killed, so there's a little bit of narrative arc to ideas. And I think founders are bringing an idea that comes in the next ten years to today, and I think that's going to be a really interesting moment where ideas are not just something that you come up with, but are a function of what everybody wants to solve versus what's actually possible to solve versus what a capital is ready to fund. And I think that's the interesting nexus, which is not only like, is this a good idea, whether you and I think it's a good idea, but this is the idea that human civilization and decided to buff. And you're like the midwife or you're just carrying it a term.

(10:11) Shiyan Koh:

That's a way more philosophical answer, Jeremy.

(10:14) Jeremy Au:

I don't know, you asked me.

(10:14) Shiyan Koh:

But then, you're just standing there, you've just given a talk, and ten people are standing there and you're like, Well, is this a good idea? And you're like, I don't Is civilization ready? Ready for you to give birth to this?

(10:25) Jeremy Au:

I just pull out the sci-fi book called Yen and banks, and I'll just be like, read this book. It'll give you 10 ideas. I don't know. It happens a lot.

(10:32) Shiyan Koh:

I mean, I think those big ideas that you talk about, Jeremy are like, often, people start with ideas that they've personally experienced. This is why when you go to a university pitch competition, you will almost guaranteed be pitched the same ideas. You will be pitched travel startups, pitched food delivery startups. You may be pitched studying startups, because these are all problems that students have experienced. And then, it is like my horrible duty to tell them that these are generally bad ideas, and not because they're not smart or not because you're not feeling pain, but more because, there are details of market structure and customer acquisition and things like that, that actually make it very difficult for these to be sustainable businesses. So I always say you kind of need to have like a hundred bad ideas before you can have a good idea. And partially that is, you need to have the experience of working through an idea and realizing for yourself why it is a bad idea before you can start to develop the taste of what a good idea looks like. And so, I say this not to discourage people from having ideas. I actually say this to encourage people to have more ideas so they can get to the good idea faster. But you actually need to try to execute your ideas, otherwise, you never develop that feeling, right?

So it's like, you can study probability, but until you pay like a hundred hands of poker, it's hard to get the feel of it, right? What it feels like when, oh, this is a good hand, I should double down. That is separate from the theoretical knowledge of what the probability of that hand so, I think that's something around like, is this a good idea or not, you need to have some sense of business history and market structure. You need to have some sense of what is the level of the customer's pain. These travel startups, people always love to pitch these, it's always a tool that makes planning your trip easier with friends and you're like, Okay, sure. They're like, oh, it's so complicated. You have so many tabs open. You have a spreadsheet, blah, blah, blah. And you're like, yeah, but would you pay for that? Would you pay for somebody? And like, how much would you pay for that? Would your friends pay for that? How many people do you need to get to pay for this thing? And they're like, oh, but we can refer destinations. We could get paid a commission on hotels or flights. And I was like, do you know what the actual payout on those things is, and what is the conversion rate you'd need to actually make a sustainable business So like, there's all of these questions I think that, they start with the top level, I feel this pain and all my friends feel this pain. Good, that's a first start. At least, some people feel the pain, right? But then getting to the how much would somebody pay? And know, can you even find enough peoplefor the e very small percentage people actually pay? I think that's always the much more challenging portion.

(12:48) Jeremy Au:

I think I like the part about, do people pay for it? I think there's a very good indicator of whether people feel enough pain for it. And I think the tricky part, when somebody won't pay for it, and when you say someone else would pay for it, is that actually you don't understand what the other person's problem is? So you're saying, Oh, hospitals or hotels will pay for it, whatever that product is, but then you're like, okay, but then do you know why the hotels are paying you for it? And I think that's where a lot of people fall apart there, which is, you're solving problem on part A, but then you're actually getting monetized for totally different persona, part B but, you know, falls apart very quick.

(13:18) Jeremy Au:

So I was just reading, YC now has the Ares missile, which is like, they're trying to create cruise missiles that's 10X cheaper, deadlier than the current generation of cruise missiles. And, I mean, we saw that, I was like, ah, you know what? That's actually a no brainer because you read any sci-fi, movie, obviously missiles and stuff, they can be smaller, miniaturized, more efficient, etc., more deadlier, more GPS, all the CDC, more AI, it can be cheaper as well, but I think the crux that they were correct was that they were saying, we want to charge the government for it because the military is going to pay for it. So, I think it was a very clear point of view, which is, the military will pay for this, and we're going to have the US military do this. Now, whether that's a very easy go to market or not, obviously there's a lot of debate, but clearly Anduril and Palantir figured out how to do it but I think that's where some more direct thinking and a natural consequence of who's going to pay for this is actually quite important.

(14:08) Shiyan Koh:

I think historically, founders have held off building things that sell the government because government procurement systems have rather been opaque, but I do think there is this wave of cracked how to get into that defense is obviously, with all the geopolitical tension, I think prople are much more motivated to go find technology from private sector to address things that are typically more developed by, defense primes or in house sort of, government led labs, so, definitely that's been an area that's grown a lot in the last ten years.

(14:36) Jeremy Au:

Yeah. And I think the experience of every country that goes to war is that actually, the country just needs every piece of production capacity. So, if you're that first wave of defense entrepreneurs willing to service demand, you get a lot of demand and get paid. And I think that's pretty common. You see that in Ukraine, there's a whole bunch of startups that are busy building drones. I was just, watch ed some of the combat footage recently, and I think it was just a crazy thing because I was and I'm still a conscript, I guess, in the Singapore military. And so watching somebody's GoPro footage of a 3D landscape where. It was kind of crazy, they're like advancing, they're fighting humans, there's drones going over them and barraging them grenades, and then there's eyes in the sky, there's directing mortar and indirect fire on them, and I was just like, this is a terrible time to be a human on the battlefield, right? It was just crazy, and I was just blown away by how insane that situation is, right? I mean,

I think as somebody who's been in military, but also as a kid, I grew up reading military action books, movies, sci-fi. So obviously, I think there's always that third eye that you're looking at it but I think I watched this YouTube video because I think a friend was saying that this is a really crazy evolution of the battlefield, if that makes sense, because every year I have to go back and do planning and so forth. Actually, we are thinking about it. We're doing war gaming and stuff. So technically that aside, but I mean, it was just a weird blend of futurism into the battlefield. And it was depressing. For me, I think my key takeaway is like better to have peace than to have war 100% all the time. But I think you just have to be aware that this isn't like the 1980s or the 1990s in terms of what people wrote about.

(16:03) Shiyan Koh:

Yeah.

(16:04) Jeremy Au:

So what makes a good idea for you?

(16:06) Shiyan Koh:

Well, I think good ideas are often remixes of things, right? Where you are like, oh, I saw a solution in one field, but I'm applying it in a field that hasn't been considered before, so even your Ukraine example, right? Like, DJI drones were like photo drones, like, I can take cool aerial shots of my vacation, and then repurposing them as war tools, like that was not, I don't think, an original application of the consumer drone. So I think you need to be exposed to more problems so you can get ideas for how to leverage different industries and differentsolutions into them. So I think, good ideas are where, like, there's an intersection and you bring a fresh perspective or a different perspective to possibly older, more entrenched problems.

(16:50) Jeremy Au:

Yeah, I 100% agree. And I think, there's something that I remember called TRIZ. I'll link it up. But this is like a nice way of thinking tools to disassemble or reassemble ideas, so I think it's really interesting to check it out. That's one way I would say as a technical way to think of ideas. I think the other part that I really resonate with as well is sometimes it just takes time, right? I gotta have a notepad you gotta write it down. You run into something, and then you just write it down. And you have a notepad of like 10, 20, 30 things, right? And I think this is something that you pick up because you know, like, a lot of stand up, this is something they pick up because a lot of, like, stand up comedians, they think of jokes in their head, and they write it down. A lot of authors walk around and have certain ideas, they just have to write it down. I

(17:26) Shiyan Koh:

And they also practice them. They practice them to get feedback. So I think there is also just like, you have an idea, but can you go talk to a potential customer and be like, Hey, this seems like a problem. Like, is it a problem? Or like, tell me more about how this problem actually shows up for you.

(17:38) Jeremy Au:

Exactly. So I think the part about having a good idea is that you're the kind of person who is like, has a lot of ideas, is a little bit of a quantity game. And then you just be that irritating friend, who keeps running ideas by your friends. And your friend's like, ah, the idea, this guy's an idea guy but I think that's part of the trust that you have with your community and friends, right? Is this that you just have more ideas and then you practice that as a skill set.

(17:59) Shiyan Koh:

I love it. I always think kick around a bunch of different ideas and see what people do with them. In the end, people have so many amazing ideas. just need to have the confidence to pursue them.

(18:08) Jeremy Au:

Yeah. On that note be brave and share your ideas with people. Even with Shiyan who thinks it's a bad idea to have her travel planning monetized by somebody else.

(18:16) Shiyan Koh:

Ah! I mean, it's all a probability game, right?

(18:18) Jeremy Au:

Yeah.

(18:18) Shiyan Koh:

It's probably challenging, but if this is your passion in life, it's not for me to stop you.

(18:23) Jeremy Au:

That is true. That's true. And maybe Shiyan's wrong, maybe Jeremy's right.

(18:26) Shiyan Koh: O

Often! Often. I'm often wrong.

(18:28) Jeremy Au:

I'm on that note, see you next time.

(18:30) Shiyan Koh:

See you next time.