In 1985, BoJack meets and befriends Herb while failing at standup. In the present, after Diane questions the origin of his relationship with Todd, BoJack decides to help Todd work on the rock opera he has always been interested in making. When Todd finds actual success and posits moving out, BoJack panics and utilizes Margo Martindale to manipulate Todd into buying an addictive video game, causing him to underperform at an investor's showcase and ruin his potential. Diane's BuzzFeed columnist ex-boyfriend pretends to work on a positive article about Mr. Peanutbutter but really uses it as an excuse to try and get back together with her, warning her that she and Mr. Peanutbutter are incompatible.

While out east to visit BoJack's publisher, Diane learns that her cruel father has died. She takes him to Boston for the funeral, only for her lazy, immature family to make her pay for it herself and then not bother to show up, having their father's body turned into chum. Diane leaves enraged, but BoJack follows and comforts her, and the two return home. BoJack calls Herb before they leave, but is forced to leave a message. Todd turns BoJack's house into a cash grab by pretending it is the home of David Boreanaz, but is quickly caught and arrested. He calls BoJack in jail, but nobody answers.

BoJack develops feelings for Diane after returning from Boston, leading him to drunkenly steal the "D" from the Hollywood Sign as a grand romantic gesture. Knowing he needs to get rid of it, he enlists Mr. Peanutbutter for help, only for him to take all the credit for the theft himself. As BoJack leaves an honest, intimate voicemail for Diane, Mr. Peanutbutter privately proposes to her, only to make a big spectacle of it when she accepts. BoJack convinces Diane to delete the voicemail without listening to it when she calls him back. Todd is courted by the Aryan Brotherhood and Latin Kings in prison, only to get them to reconcile their differences and escape when a helicopter returning the "D" crashes into the prison wall.

Two months later, BoJack has been cast as Mr. Peanutbutter in the movie about the Hollywood Sign and strikes up a relationship with Naomi Watts, who is playing Diane. Todd gains the director's favor and begins changing the movie's script to make BoJack out to be the villain of the story, eventually taking apart the movie entirely. When BoJack confronts him, Todd reveals he had no malicious intentions, but does not forgive BoJack, and Watts explains that she only slept with him to stay in character. Diane shows BoJack her current draft of his book, which he feels does not make him look good and insults it. Angry, Diane gets her ex-boyfriend to publish a teaser from it on BuzzFeed. The teaser receives positive feedback, but BoJack fires Diane anyway.

BoJack promises his publisher to write a better book than Diane, but finds himself struggling to start. He, Todd, and Sarah Lynn take drugs together and write a gibberish book, and Todd admits he does not care about the loss of his rock opera because he did not expect anything better from BoJack. BoJack begins to hallucinate visions of Diane and Horsin' Around while trying to reach a conclusion about his self-worth, and he has a flashback to his mother forcing on him the same advice he did Sarah Lynn. He imagines marrying Charlotte, a deer that was close friends with him and Herb, and having a daughter with her, only to finally wake up from his hallucinations. He goes to Diane at a ghostwriter convention and admits her book is excellent. He begs her to tell him that he is a good person; Diane does not respond.

In 1973, BoJack writes into The Dick Cavett Show while Secretariat is being interviewed, asking what he does when he feels sad. Secretariat tells BoJack to always keep running forward. One month later, Secretariat dies by suicide after being banned from racing. Three months after the release of the book, BoJack wins a Golden Globe and convinces producer Lenny Turtletaub to finally greenlight the Secretariat biopic, with a woman named Kelsey Jannings directing and Andrew Garfield playing the lead. Diane is invited by eccentric billionaire Sebastian St. Clair to document his providing of aid to impoverished countries, which would require her to leave Los Angeles for three months. Todd and Mr. Peanutbutter come up with a series of outlandish business ideas, one of which hospitalizes Garfield and gets BoJack the role of Secretariat. BoJack talks to Diane on her roof for the first time since he approached her at the convention, and she reveals she has been hired to work on the biopic. They discuss the true nature of happiness before BoJack admits he just wanted Diane to like him, and she says that she knew. BoJack visits the observatory where Herb revealed that Horsin' Around was being picked up, where he signs an autograph for a horse fan.