A reminder for new readers. Each week, That Was The Week includes a collection of selected readings on critical issues in tech, startups, and venture capital. I chose the articles based on their interest to me. The selections often include viewpoints I can't entirely agree with. I include them if they provoke me to think. Click on the headline, contents link, or the ‘Read More’ link at the bottom of each piece to go to the original. I express my point of view in the editorial and the weekly video below.
Hat Tip to this week’s creators: @danshipper, @mgsiegler, @KyleHarrison18, @DouglasKMurray, @AISupremacyNews, @2020science, @idanbeck, @rhodgkinson, @scottehartley, @mikeloukides, @deanwball, @SiliconZombies, @parmy, @ajkeen, @Kyle_L_Wiggers, @maureendowd, @noahpinion, @jasonlk, @KateAndrs, @alex
Contents
Editorial
There is one winner regarding the most significant story this week. Elon Musk and Vivek Ramaswamy have been made advisors to the Trump administration on Government efficiency in a department called DOGE (Department of Government Efficiency). Their advisor status is widely assumed to be to avoid apparent conflicts, but in reality, they are likely to wield much power.
It is rumored that Marc Andreessen was also seen on election night in Mara-a-Lago and is engaged in giving Trump advice on Tech issues.
Many of my friends (perhaps you are one of them) are horrified that Elon has this much power and are inclined to assume bad things will happen. That may well be right, but…..
It makes sense to stand back and talk about “Government.” What is it? Who is it for? Can it be improved? How can it be improved? These should not be scary questions, and Elon Musk’s presence can be good or bad, depending on what ensues. For now, at least, I want to give him the benefit of the doubt.
What is Government?
There is no question that the government is intended to be a service organization that provides the agreed-upon services to the people. Government of the people, for the people, and by the people does mean something. It includes executive, legislative, and judicial functions. However, most of those employed by the government deliver local and federal services.
Who is it for?
The government is for all of us. It is not a partisan organization. It creates and administers. Because it is a vast bureaucracy, it certainly can serve itself rather than us, and elections are where it can be held accountable. The belief that it has been captured is permanently damaging to its credibility. It must be neutral and service-focused.
Can it be improved?
If you have ever been to your local DMV, you know that it can be improved. Processes and costs are both subject to review and improvement. Cost is a genuine concern, and any innovation designed to deliver improved services at lower cost should be welcomed. How a service is offered may be a pivotal way to make it better and more affordable. Education is a great example. What would a sound education system look like in the age of AI? Health and Military also.
How can it be improved?
This is where Elon Musk and Vivek Ramaswamy can be an asset to us rather than something to be scared of. If Musk commits to asking how each service can be delivered, he will likely want to modernize, not destroy. Modernized education, health, military, infrastructure, and planning would all be benefits we should champion.
Improved service delivery may make saving $2 trillion possible. Estonia is a good study of a modern government; there is much to learn. But Musk may even go beyond Estonia.
Give him a break and advice.
So, I will bet on Elon doing good things and hold him accountable for delivering on them. He is working for us, and we care about the outcome. Assuming failure is not helpful.
I assume he will bring technical skills, AI, and people to the party who are all working for us, not against us. Silicon Valley thinking, delivering government as a service may end up being the best thing this election delivers.
The election has significantly increased the writing output of almost everybody I read. So this week, the essays and news are both long sections:
Significant Themes in Essays of the Week
The Future of AI Development
Several essays discuss the trajectory of AI, particularly large language models (LLMs). Some, like "Is AI Progress Hitting a Wall?" and "The AI Wall," suggest that the rapid progress seen in LLMs might be slowing down. They point to the limitations of current approaches and the enormous resources required for further scaling.
However, these essays also acknowledge that the field is evolving. New techniques, like inference-time compute, offer potential for improvement without needing massive increases in pre-training data and computational resources.
Other essays, such as "Blown Away," express excitement about recent innovations, such as NotebookLM's ability to generate summaries and Anthropic's Computer Use API, which allows AI to interact with computer interfaces. Overall, the essays paint a picture of a field at a crossroads, where the initial hype gives way to a more realistic assessment of challenges and the exploration of new approaches that could lead to further breakthroughs.
Silicon Valley and Politics
A prominent theme is the increasing intertwining of Silicon Valley with politics and government. "Welcome to Life on Planet Elon" discusses Elon Musk's prominent role as an advisor in the Trump administration, highlighting the potential benefits and concerns about his influence.
"How Silicon Valley is Prepping for War" expresses concern about the growing involvement of tech companies in military and national security initiatives, suggesting a trend toward militarizing AI. The essay highlights ethical considerations, the potential for dystopian uses of AI, and the blurred lines between Silicon Valley and government policies.
"Techies Push Other Techies to Musk to Join Trump Administration" reports on tech leaders recommending their peers for positions in the Trump administration, further emphasizing the tech sector's increasing influence on politics.
Venture Capital Landscape
Several essays focus on the dynamics of the venture capital (VC) industry. "Access is everything" emphasizes the importance of access to top-tier funds for achieving high returns. The essay discusses the role of data in VC decision-making, the potential of emerging managers, and the need for innovative investment models.
"Time Dislocations in Venture Capital" describes VC as a "lumpy, long-term annuity," where investors shift capital from the present to the future with the expectation of higher returns but also higher risk.
"Startups Are Far More Overvalued Now Than in 2021" raises concerns about inflated startup valuations despite declining public software company valuations. The essay points to the surge in AI investments as a factor driving these high valuations but questions their sustainability without substantial growth in the software and cloud sectors.
These essays provide insights into the current state of VC, highlighting both opportunities and potential risks for investors.
Social and Political Commentary
Beyond focusing on AI and VC, the essays also touch on broader social and political issues. "Embrace The Nuance" addresses the complexities of political discourse and the dangers of oversimplification.
"Dear Journalists: Stop Trying to Save Democracy" critiques the role of journalists in a democratic society.
"The Educated Professional Class is out of touch with America" discusses the growing divide between the educated professional class and the rest of the country, highlighting the implications of this trend for politics and society.
"Democrats and the Case of Mistaken Identity Politics" critiques the Democratic Party's focus on identity politics, arguing that it alienated key voter groups and contributed to their electoral defeat.
I was part of a panel on the future of venture funding, it is the Video of the Week.
Essays of the Week
Is AI Progress Hitting a Wall?
Published: 2024-11-14T18:18:20Z | Reading Time: 3 min | Domain: every.to
Summary: Recent discussions have raised concerns about a potential slowdown in AI progress, particularly following reports that OpenAI’s new model, Orion, showed only modest improvements over GPT-4. Critics like Gary Marcus have expressed skepticism about the future trajectory of AI advancements.
However, this perspective overlooks significant developments in AI research. While pre-training large language models with extensive data and computational resources has yielded substantial gains, this approach is approaching diminishing returns. In response, researchers are shifting focus to inference-time compute, a strategy that involves enhancing model performance during the inference phase by allowing models to process information more thoroughly before generating responses. This method has shown promise in improving model outputs without the need for additional pre-training.
For instance, OpenAI’s o1 model has demonstrated that allocating computational resources to inference can lead to better results, even when pre-training improvements are limited. This approach represents a new paradigm in AI development, emphasizing the optimization of existing models through more efficient inference processes.
In summary, while the traditional method of pre-training large language models may be reaching its peak, AI progress is far from stagnating. The field is evolving by exploring innovative strategies like inference-time compute, ensuring continued advancements in AI capabilities.
Read more
The AI Wall
Author: M.G. Siegler | Source: Spyglass | Published: 2024-11-14T17:16:54Z | Reading Time: 3 min | Domain: spyglass.org
Summary: “The AI Wall” discusses the apparent plateau in the progress of large language models (LLMs), particularly in the context of leading AI development companies like OpenAI, Google, and Anthropic. Here’s a detailed summary of the main points covered in the document:
Overview of Current AI Development Challenges
• Pace of Breakthroughs Slowing: There’s a notable slowdown in the rapid advancements previously seen in AI, especially concerning the development of LLMs like those that power chatbots and other AI-driven technologies. This shift is attributed to the inherent limitations of the current underlying technologies which have reached a plateau.
• Transition to New Models: The focus is shifting from purely enhancing LLMs to integrating these models with “reasoning” capabilities, suggesting a move towards more sophisticated, agentic AI systems. This transition is part of a broader evolution from basic chatbot functionalities to more dynamic AI agents capable of more complex interactions and tasks.
Strategic Shifts and Their Implications
• Costs and Resource Allocation: The document highlights concerns about the sustainability of heavily investing in AI technologies, especially in terms of the financial and computational resources required. There’s a mention of the construction of massive data centers equipped with extensive GPU setups, raising questions about the practical limits of such investments.
• Impact on Major Tech Companies: There’s speculation about whether companies like Apple, which have adopted a more cautious and measured approach to AI investment, might ultimately benefit from not rushing into extensive AI buildouts. The document posits whether Apple’s strategy will allow it to capitalize on the groundwork laid by others without bearing the initial costs.
Broader Industry Trends and Considerations
• Potential for New Breakthroughs: Despite the current slowdown, there is an acknowledgment that breakthroughs could still occur, potentially driven by new approaches such as the incorporation of multimodal data or entirely new methodologies that have yet to be developed.
• Market Dynamics and Competitive Stances: The document reflects on the competitive dynamics among key players in the AI industry, including the tension between open-source initiatives and proprietary development models. There’s an underlying theme of how commercial pressures and market expectations might influence the strategic directions of these companies.
Concluding Thoughts
• Future of AI Development: The discussion concludes on a note of cautious optimism, suggesting that while the current plateau might represent a temporary lull, the foundational technologies developed so far are robust enough to support the next generation of AI applications. The key will be how effectively new paradigms and innovations can be integrated into the existing framework to overcome current limitations.
This summary reflects on the challenges facing the AI industry, particularly the slowdown in rapid innovation that characterized earlier phases of AI development, and speculates on the strategic adaptations that may be necessary as the industry evolves.
Embrace The Nuance
Author: Kyle Harrison | Source: Investing 101 | Published: 2024-11-09T17:51:37Z | Reading Time: 17 min | Domain: investing1012dot0.substack.com
Summary: This is a weekly newsletter about the art and science of building and investing in tech companies. To receive Investing 101 in your inbox each week, subscribe here: I remember being in high school in my English class where we were doing speech and debate. This was in 2008, so the perspective of being lied into Iraq was well on record and, for whatever reason, basically every other person in that class in New Mexico was staunchly anti-Bush. And some of the worst the Republican party has to offer, like Andrew Tate or Nick Fuentes, see it as a victory for their horrendous id...
Welcome to life on Planet Elon
Author: Douglas Murray | Published: 2024-11-14T17:45:37Z | Domain: spectator.co.uk
Summary: On 13 July this year, an assassin’s bullet grazed the ear of Donald Trump as he turned his head on stage in Butler, Pennsylvania. The whole world saw it and his response: ‘Fight, fight, fight.’ For Elon Musk, this was not just a news event but a galvanising and clarifying moment. He immediately posted a video of the shooting to X and wrote: ‘I fully endorse President Trump and hope for his rapid recovery.’ Musk is different from most people. For him, going all-in really means going all-in. When Trump returned to Butler last month, he was joined on stage by the billionaire. Musk is now one of the most important figures in the team around the President-elect as he prepares his new administration. From the moment he expressed his support for Trump, Musk not only committed tens of millions ...
How Silicon Valley is prepping for War
Author: Michael Spencer | Source: AI Supremacy | Published: 2024-11-11T16:44:14Z | Reading Time: 7 min | Domain: ai-supremacy.com
Summary: Michael Spencer’s article, “How Silicon Valley is Prepping for War,” discusses the concerning trend of the increasing involvement of Silicon Valley’s AI and tech firms in military and national security initiatives, which he views as a move towards the militarization of artificial intelligence. Here are the key points from the article:
1. Militarization of AI in Silicon Valley: Spencer highlights the historical and ongoing collaboration between major tech companies and the U.S. Department of Defense, such as Google’s involvement in Project Maven, which used AI to improve drone targeting. This partnership is described as increasingly normal and accepted within the industry.
2. Profit Motives and National Security: The article points out that the collaboration between BigTech and the Pentagon is highly profitable, as demonstrated by Palantir’s stock performance, which has surged due to its contracts with the military. This suggests that financial incentives are a significant driver behind the tech industry’s deepening relationship with the military.
3. Anthropic and OpenAI’s Roles: Both Anthropic and OpenAI are mentioned as examples of AI companies that are aligning with military efforts, with recent partnerships and initiatives aimed at integrating their AI models into defense projects. This includes making their technologies available to U.S. intelligence and defense agencies through collaborations with Amazon Web Services.
4. Ethical Concerns and Employee Activism: Spencer reflects on the ethical dilemmas and internal opposition that these military partnerships have historically faced within companies like Google. However, he notes that in recent times, employee activism and dissent have been significantly suppressed.
5. Impact of National and Global Politics: The involvement of Silicon Valley in national security is linked to broader geopolitical and economic strategies, including efforts to restrict China’s technological and AI capabilities. This is exemplified by U.S. actions to limit advanced chip exports to China and the strategic positioning of semiconductor manufacturing in the U.S.
6. Dystopian Future and AI Policy: The article presents a grim outlook on the future of AI, where the leading AI labs and technologies are co-opted for national security purposes, potentially leading to more dystopian uses of AI. Spencer expresses concern about the ethical direction of Silicon Valley and the potential consequences of its technologies being used in warfare and surveillance.
7. Critique of Government and BigTech Alignment: Finally, Spencer criticizes the increasingly indistinguishable boundaries between Silicon Valley’s tech giants and U.S. government policies, suggesting that this alignment poses risks to democracy, capitalism, and the rule of law.
Overall, the article provides a critical perspective on the evolving role of Silicon Valley’s AI and tech firms in the military and national security sectors, emphasizing the ethical, political, and social implications of this trend.
Dear Journalists: Stop Trying to Save Democracy
Author: Yascha Mounk | Source: yaschamounk.substack.com | Published: 2024-11-14T18:21:14Z | Reading Time: 14 min | Domain: yaschamounk.substack.com
Summary: Thank you to everyone for the insightful comments on the question I asked on Sunday. But the leaders of the newsroom took very seriously their duty both to be neutral and to be seen to be neutral. Democracies depend on having a few widely trusted news outlets that can objectively inform the public about current affairs. Is it really plausible that American journalists were unable to learn something that has been known in capitals across Europe for so long—something that, as it happens, tens of millions of American voters have long cited as a serious concern in opinion polls? Even in the halcyon days when The New York Times was (...
Is AI poised to suck the soul out of science?
Author: Andrew Maynard | Source: The Future of Being Human | Published: 2024-11-10T15:20:50Z | Reading Time: 4 min | Domain: futureofbeinghuman.com
Summary: Mark’s article refers to a just-published study from MIT’s Aidan Toner-Rodgers that looked at the impact of AI on materials science innovation the R&D lab of a large U.S. firm. In particular, the research shows a significant increase in research and development productivity when scientists used an AI tool designed specifically to increase the rate of discovery of new materials. However — and this is what stuck out for me in Mark’s article — the research also showed that (quoting Toner-Rodgers) “while enjoyment from increased productivity partially offsets this negative effect—especially for high-ability scientists—82% of researchers see an overall decline in satisfaction.” It was this decline in satisfaction in the work they were doing that grabbed my attention! Quoting Mark : When pair...
Just in Time Software
Author: Idan Beck | Source: idan.substack.com | Published: 2024-11-13T20:26:09Z | Reading Time: 8 min | Domain: idan.substack.com
Summary: Will anyone need to code anymore? And I believe we have been entering a new paradigm of software development that I’ve been calling "Just in Time Code," or more generally "Just in Time Software" for short. Not to be confused by AI code-generation, Just in Time Software differs from simply using tools like Cursor or Copilot to generate code. Often Code is seen as a kind of up-front investment followed on by on-going maintenance costs. Fundamental components and modules are strung together with functional logic to create software flexible to the evolving needs of it’s users. Codebases are developed over long periods by oft-changing teams, which institute both superficial and programmatic conventions such as choice of programming language or frameworks. Currently, JIT Software isn't fully ...
Access is everything
Author: Rob Hodgkinson | Source: SignalRank Update | Published: 2024-11-14T16:17:06Z | Reading Time: 13 min | Domain: signalrankupdate.substack.com
Summary: Rob Hodgkinson’s views on venture capital, as outlined in “Access is Everything,” correlate strongly with SignalRank’s algorithms and approach in several key areas:
1. Emphasis on Access to Top-Tier Funds:
Rob underscores the critical importance of access in venture capital, noting that the highest returns are often secured by those who can invest in the best-performing funds. This mirrors SignalRank’s approach, which uses algorithms to identify and invest in high-potential companies at Series B by leveraging data to ensure access to these lucrative investments.
2. Utilization of Data-Driven Decision Making:
Rob discusses the growing role of data in venture capital, where data-driven VCs use extensive datasets to enhance their investment strategies. SignalRank’s model aligns with this by using an algorithmic approach to evaluate potential investments, thereby reducing reliance on the more traditional, subjective methods of VC investing that focus heavily on personal networks and relationships.
3. Focus on Emerging Managers:
Rob highlights the potential of emerging managers who can offer higher returns compared to established funds, due to their smaller size and more agile operations. SignalRank’s strategy complements this viewpoint by partnering with seed investors and micro VCs, often considered emerging managers, to access and support high-growth opportunities at an early stage.
4. Innovative Investment Models:
Rob advocates for innovative models to overcome the barriers of traditional venture capital investing. SignalRank embodies this innovation by providing a platform that allows broader investor access to top-tier VC deals through a structured, algorithm-driven approach. This method enhances liquidity and lowers entry barriers, characteristics that are particularly appealing in a market dominated by large, often inaccessible funds.
5. Reducing Investment Risks:
Rob’s discussion about the variance of outcomes in venture capital and the importance of selecting the right managers aligns with how SignalRank’s algorithms are designed to minimize risks. By focusing on data to pick winners and eliminate underperformers early in the investment cycle, SignalRank aims to improve the predictability and reliability of venture capital returns.
Conclusion:
Rob Hodgkinson’s insights reflect a sophisticated understanding of the current venture capital landscape, emphasizing the necessity of access, the potential of emerging trends, and the transformative power of data. SignalRank’s algorithmic approach and innovative investment model are direct responses to these themes, providing a practical solution that aligns closely with Rob’s views on how the future of venture capital might evolve to be more inclusive and efficient. This synergy suggests a coherent strategy where traditional VC challenges are addressed through modern, data-enhanced methods that expand access and reduce the typical risks associated with early-stage investments.
Time Dislocations in Venture Capital
Author: Scott Hartley | Source: Everywhere with Scott Hartley | Published: 2024-11-09T14:53:59Z | Reading Time: 4 min | Domain: ideas.scotthartley.com
Summary: One of the ways I describe venture capital as an asset class to those considering investing is that it’s like a very lumpy, long-term annuity. It’s a phase shift, or a time dislocation, moving money from now to some time in the distant future. Whereas an annuity has next to no risk, but also next to no upside, consistent allocation into venture capital can provide a long run dislocation of capital, but with higher risk and also much higher potential future returns. It’s a “lumpy annuity.” If you’re bearish on today, but bullish on tomorrow, you might want to shift some of your capital out into this future set of opportunities or outcomes. In other words, you might want to allocate into venture capital, because this is a bet on the future, and a time shift of smaller returns today for bi...
Blown Away
Author: Mike Loukides | Source: Radar | Published: 2024-11-12T13:18:18Z | Reading Time: 4 min | Domain: oreilly.com
Summary: In “Blown Away,” Mike Loukides shares his excitement about recent advancements in AI technology, particularly highlighting two innovations that have impressed him:
1. NotebookLM’s Capability: Mike experiments with NotebookLM by using it to generate a summary and suggested questions for two of his previous posts. He is particularly impressed by the quality of the podcast produced by NotebookLM, featuring a discussion between two synthetic voices. Despite some inaccuracies, the quality of the summary and the engaging nature of the podcast discussion stood out to him. However, he notes some user interface issues with accessing the podcast later, which he finds unnecessarily complicated.
2. Anthropic’s Computer Use API: Anthropic has released a beta version of its computer use API, which allows the AI, Claude, to interact with computer interfaces like browsers and editors. This tool lets Claude perform tasks using a virtual Linux computer within a Docker container—for example, automating data collection and spreadsheet updates. Mike is intrigued by the potential of this technology to simplify complex tasks that currently require elaborate prompts and manual data handling. However, he also cautions that this technology is still in its early stages and susceptible to errors and security risks like prompt injection attacks.
Loukides wraps up by discussing an innovative use of AI in managing personal relationships and data, inspired by Sam Lessin’s use of GPT and NotebookLM to manage years of emails as a personal CRM system. This, Mike suggests, could herald a shift away from traditional CRM systems towards more integrated, AI-driven solutions, although he remains skeptical about the long-term viability of startups entering this space due to potential competition from tech giants.
Overall, the article conveys a sense of optimism and curiosity about the future of AI, tempered by an awareness of the current limitations and challenges of these emerging technologies.
Here's What I Think We Should Do
Author: Dean W. Ball | Source: www.hyperdimensional.co | Published: 2024-11-14T17:53:48Z | Reading Time: 16 min | Domain: hyperdimensional.co
Summary: Dean W. Ball’s essay, “Here’s What I Think We Should Do: A Proactive AI Policy Agenda,” outlines a comprehensive framework for the United States to navigate the transformative impact of artificial intelligence (AI). Ball emphasizes that AI represents a significant discovery in human history, enabling machines to perform cognitive tasks that often surpass human capabilities. He advocates for a proactive approach to AI policy, focusing on several key areas:
Federal Role in AI Safety
Ball argues against overregulation of AI models, suggesting that such measures could stifle innovation and scientific inquiry. Instead, he proposes that the federal government should ensure transparency among leading AI laboratories. This includes requiring the publication of responsible scaling policies and model specifications, which would be enforced through whistleblower protections.
Legislative Action and Preemption
To prevent a fragmented regulatory landscape, Ball calls for federal preemption of state AI laws. He highlights the risks of state governments unilaterally imposing regulations that could hinder national competitiveness and innovation. Ball also emphasizes the need for a federal AI liability standard, promoting personal responsibility and accountability in AI development and deployment.
Transparency and Evaluation
Ball underscores the importance of transparency in AI development. He suggests that the federal government should mandate the publication of technical documents detailing AI model behaviors and responsible scaling policies. Additionally, he advocates for the creation of an ecosystem of AI model evaluators to assess capabilities and ensure compliance with existing regulations.
Technical Protocols and Infrastructure
Recognizing the physical infrastructure requirements of AI, Ball proposes reforms to facilitate the construction of essential facilities, such as data centers and semiconductor manufacturing plants. He also suggests maintaining export controls on critical AI hardware and investing in manufacturing technologies to enhance the United States’ production capabilities.
Conclusion
Ball concludes that a proactive and strategic approach to AI policy is essential for the United States to harness the benefits of AI while mitigating potential risks. He invites feedback and collaboration on these proposals, viewing the essay as a starting point for ongoing research and discussion.
Video of the Week
The Future of Funding
Interview of the Week
Supremacy: AI, ChatGPT, and the Race that Will Change the World
Startup of the Week
Generative AI startup Writer raises $200M at a $1.9B valuation
Author: Kyle Wiggers | Source: TechCrunch | Published: 2024-11-12T14:14:09Z | Domain: techcrunch.com
Summary: Writer has raised $200 million at a $1.9 billion valuation to expand its enterprise-focused generative AI platform. The Series C round was co-led by Premji Invest, Radical Ventures and ICONIQ Growth, with participation from Salesforce Ventures, Adobe Ventures, B Capital, Citi Ventures, IBM Ventures and Workday Ventures. Writer CEO May Habib says the new cash, […] © 2024 TechCrunch. All rights reserved. For personal use only.
Post of the Week
Democrats and the Case of Mistaken Identity Politics
Author: Maureen Dowd | Source: NYT > Maureen Dowd | Published: 2024-11-09T12:10:18Z | Domain: nytimes.com
Summary: The post mortem is a wake for woke. In her November 9, 2024, New York Times opinion piece, Maureen Dowd critiques the Democratic Party’s focus on identity politics, attributing it to their recent electoral defeat. She argues that the party’s emphasis on political correctness and “wokism” has alienated key voter groups, including working-class and moderate voters. Dowd suggests that divisive topics, such as abortion and transgender athletes in women’s sports, have further estranged voters. She advocates for the Democratic Party to reconnect with these groups by returning to core issues that impact rural and working-class Americans, moving away from identity-focused politics.
The educated professional class is out of touch with America
Author: Noah Smith | Source: Noahpinion | Published: 2024-11-10T16:43:06Z | Reading Time: 3 min | Domain: noahpinion.blog
Summary: The third big lesson, I think, is about class in America. The educated professional class is drifting away from the rest of the country, in terms of values, beliefs, and their information diet. This election upended a lot of demographic trends that people had been very certain about only a few years ago. Over the years, the Democratic base has shifted decisively from the working class to the educated professional class: This shift doomed Harris’ campaign, since people without college degrees outnumber their college-educated counterparts — in 2024, the latter were only 43% of the electorate . In the past, when college education was steadily increasing, it was easy to think that college-educated voters would own the future. But in recent years, the rate of college enrollment has plateaued...
News Of the Week
Startups Are Actually Far More Overvalued Now Than in 2021
Author: Jason Lemkin | Source: SaaStr | Published: 2024-11-12T15:15:46Z | Domain: saastr.com
Summary: Battery Ventures’ recent analysis indicates that, despite a decline in public software company valuations, startup valuations remain elevated, leading to a significant premium over public market multiples. Specifically, while public cloud company valuations have decreased by 66% from 21.2x revenue in 2021 to 7.3x currently, startup valuations have only declined from 39.0x to 23.4x. This results in venture capitalists paying a 3.2x premium over public valuations for high-growth startups, compared to a 1.8x premium in 2021.
The report suggests that the surge in artificial intelligence (AI) investments is a key factor driving these high valuations. Battery Ventures posits that AI has the potential to quadruple software and infrastructure spending by reallocating approximately $3 trillion from services and labor to AI-driven solutions. This anticipated shift is expected to justify the current high valuations of AI-focused startups.
However, for these valuations to be sustainable, AI must deliver substantial growth in the software and cloud sectors, necessitating a significant increase in overall spending. Without this expansion, the existing IT budgets may not support the elevated valuations observed in the startup ecosystem.
Reeves to tell regulators to dial up risk in UK financial services
Author: Sam Fleming | Published: 2024-11-14T18:11:38Z | Reading Time: 3 min | Domain: ft.com
Summary: Chancellor Rachel Reeves will tell City of London regulators to dial up the risk in the UK financial services sector, claiming that rules drawn up after the 2008 financial crash have “gone too far” and are stifling growth. Her speech will include a series of financial services reforms, notably in the pensions sector. The chancellor told the Financial Times on Wednesday that talk of the risk of a trade war was “a bit over the top” but added: “We believe in free and open trade. We will continue to make those representations.” Reeves on Thursday sent “remit” letters to City regulators telling them to focus on growth. “That has gone too far and, in places, has had unintended consequences which we must now address,” she will ...
Will Rachel Reeves' pension shake-up really boost growth?
Author: Kate Andrews | Published: 2024-11-14T17:58:36Z | Reading Time: 2 min | Domain: spectator.co.uk
Summary: As Chancellor Rachel Reeves prepares to deliver her first Mansion House speech in the City of London tonight, one word is set to be emphasised: growth. ‘Last month’s Budget fixed the foundations to restore economic stability and put our public services on a firmer footing,’ she will tell her audience of bankers and City workers. ‘Now we’re going for growth.’ Her sights are set on pensions. Drawing on pension models from Canada and Australia, Reeves aims to increase the size of public sector pension funds – a factor she believes has held funds back from making larger, more fruitful investments. Reeves is also expected to outline new objectives for the Bank of England and the Financial Conduct Authority, placing greater emphasis on growth. The focus on pensions comes just two weeks after ...
OpenAI and others seek new path to smarter AI as current methods hit limitations
Author: Krystal Hu | Published: 2024-11-14T21:17:47Z | Reading Time: 6 min | Domain: reuters.com
Summary: - AI companies face delays and challenges with training new large language models - Some researchers are focusing on more time for inference in new models - Shift could impact AI arms race for resources like chips and energy Nov 11 (Reuters) - Artificial intelligence companies like OpenAI are seeking to overcome unexpected delays and challenges in the pursuit of ever-bigger large language models by developing training techniques that use more human-like ways for algorithms to "think". A dozen AI scientists, researchers and investors told Reuters they believe that these techniques, which are behind OpenAI's recently released o1 model, could reshape the AI arms race, and have implications...
ChatGPT can now read some of your Mac’s desktop apps
Author: Maxwell Zeff | Source: TechCrunch | Published: 2024-11-14T18:06:10Z | Domain: techcrunch.com
Summary: OpenAI’s ChatGPT is starting to work with other apps on your computer. On Thursday, the startup announced the ChatGPT desktop app for macOS can now read code in a handful of developer-focused coding apps, such as VS Code, Xcode, TextEdit, Terminal, and iTerm2. That means developers will no longer have to copy and paste their […] © 2024 TechCrunch. All rights reserved. For personal use only.
Palantir to Provide Anthropic’s Claude to U.S. Military
Author: Rocket Drew | Source: The Information | Published: 2024-11-08T05:39:51Z | Domain: theinformation.com
Summary: Palantir, which sells software to governments and enterprise firms, announced on Thursday that Anthropic’s Claude 3 and 3.5 models became available earlier this month to U.S. defense agencies through its AI platform, which allows customers to automate tasks, such as responding to emails. ...
Recent Venture Deals Show AI Valuations May Be Cooling
Author: Jon Victor | Source: The Information | Published: 2024-11-14T21:06:24Z | Reading Time: 3 min | Domain: theinformation.com
Summary: The latest example is Synthesia, which helps companies create AI videos. That means the new valuation would be 30 times the startup’s forward revenue. In AI video, major developers such as OpenAI and Google are building competing products, and there are at least 16 AI video startup rivals, according to the Generative AI Database. It also differs from AI video rivals because it sells its product primarily to businesses rather than to individuals or video producers. The AI avatar can read from a script to train salespeople or update employees on new benefits, for instance. Some customers, such as German sales tech firm Doculife, also use the technology to produce video demonstrations of their products that they post on the...
Database Provider Snowflake Steps Into AI-Powered Search
Author: Kevin McLaughlin | Source: The Information | Published: 2024-11-13T12:25:32Z | Domain: theinformation.com
Summary: Snowflake, at its annual conference for developers, unveiled a preview of a forthcoming product that lets customers ask questions and get answers from the information they store in its database, as well as third-party products like Salesforce and Google Workspace. The product includes tools ...
EU Fines Meta $843 Million Over ‘Abusive’ Facebook Ad Practices
Author: Sylvia Varnham O'Regan | Source: The Information | Published: 2024-11-14T16:17:32Z | Domain: theinformation.com
Summary: The European Commission has fined Meta Platforms 797.72 million (around $843 million) for breaching antitrust rules in tying its classified advertising service Facebook Marketplace to the Facebook app. The commission said Meta had imposed unfair trading conditions on competing ad providers to “ ...
Techies Push Other Techies to Musk to Join Trump Administration
Author: Theodore Schleifer and Mike Isaac | Source: NYT > Technology | Published: 2024-11-14T22:09:48Z | Domain: nytimes.com
Summary: Tech leaders are recommending their own brethren to Mr. Musk and others, as they aim to leave a Silicon Valley imprint on Donald Trump’s new administration.
The Musk-a16z administration
Author: Alex Wilhelm | Source: Cautious Optimism | Published: 2024-11-14T20:16:09Z | Reading Time: 3 min | Domain: cautiousoptimism.news
Summary: Elon Musk and Marc Andreessen, co-founder of venture capital firm Andreessen Horowitz (a16z), have played significant roles in supporting Donald Trump’s return to the White House. Musk’s influence is notable; he has participated in calls with foreign leaders and attended national security meetings with Trump, alongside key aides like Stephen Miller and Donald Trump Jr. His involvement has been so pronounced that some Trump aides view his role as surpassing that of other transition leaders.
Similarly, Andreessen has been actively engaged in the transition process. He, along with his co-founder Ben Horowitz, has produced in-house podcasts discussing their perspectives and contributions to the incoming administration. Their efforts encompass providing capital, staffing assistance, personal time, and advocacy, reflecting a deep commitment to shaping the administration’s direction.
This collaboration between Musk, Andreessen, and Trump underscores a significant alignment between Silicon Valley’s tech elite and the political landscape. Their combined influence is poised to impact policy decisions, particularly in areas like technology regulation and innovation. As the administration takes shape, the extent of their influence will become clearer, but their current involvement indicates a strong partnership between the tech sector and the new political leadership.
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