Elon's Anthropic Deal, The Next AI Monopoly?, "FDA for AI" Panic, Trading the AI Boom

Chamath Palihapitiya: I think the deal is fantastic. ... Anthropic and OpenAI's revenue performance has nothing to do with demand. Zero. It is entirely to do with the supply constraints that exist in data centers and specifically in power. If they had infinite power, I think that their revenues would probably be even more parabolic. ... For Elon, if you look inside of how people try to nitpick the SpaceX valuation case... the biggest element is the on-the-come value around the orbital data centers. And by actually landing a bunch of terrestrial capacity, I think you start to blunt that because you can now start to say that even if the orbital data centers get delayed by a few months or a few quarters... he now has a structural core business that will effectively subsidize his ability to train Grok.

Chamath Palihapitiya: When people try to paint the bear case or they try to red team the valuation, the biggest element is the on-the-come value around the orbital data centers. And by actually landing a bunch of terrestrial capacity, I think you start to blunt that because you can now start to say that even if the orbital data centers get delayed by a few months or a few quarters, even if the technological de-risking of it takes longer, he now has a structural core business that will effectively subsidize his ability to train Grok, which I think is a really important and under-reported theme. So you have all this infrastructure. He somehow saw the tea leaves before most people. He built to a level of scale and secure power before most people. It has now become the critical asset. And now he's kind of king-making. And I think that that's a really interesting valuation reinforcement as SpaceX goes through testing the waters and the roadshow.

Brad Gerstner: One thing I want to dispel this myth, this is not like organic, hyper-local protests by people in a community that aren't being spurred on. This is highly organized activists that are moving across the country to stir up trouble in the exact same way they did to stop all fission reactors being built 30 years ago in America. Now we have no nuclear reactors being built. China's got 100 of them. Who was funding those activists? I think we need to really look into who's funding the activists now. ... The misinformation about water, the misinformation about electricity bills — electricity bills are going up in the places that are not building data centers, New York and California, because they haven't built any supply on the grid. In Texas, where you're building the most data centers in the country, electricity costs are going down.

David Sacks: Unless something about their current trajectory changes, Anthropic will be the most powerful monopoly ever created in human history. Again, it will be a trillion dollars of ARR growing at some exponential. Dario calls it AGI. I call it the biggest monopoly in human history. And I guess I do have a thought experiment for you guys. I just want you to think for a second about the case of John D. Rockefeller, who is known as probably the most successful monopolist in American history. Imagine if John D. Rockefeller was way better at public relations. And instead of calling his company Standard Oil, he called it Safe Oil. And I think people would have gotten so wrapped up in this debate over what constituted safe oil or safe kerosene that they would have missed what was really going on, which is that Rockefeller was building the richest, most powerful monopoly of all time. In fact, people might even have called Rockefeller an effective altruist, because of course, he was so concerned about the safety of his product. I do think that if you actually look at what a lot of the safetyist policies are calling for, they're basically calling for a form of regulatory capture. And they're calling for things that would create a stronger moat around this monopoly or duopoly that's in the process of being created. And it would get in the way of competition.

Brad Gerstner: It's ridiculous to think of this as a monopoly. You know, we're talking about annual run rate revenues, David, but on a gap basis, they're doing about the same revenue as OpenAI in the month of March. Okay, so we're way ahead of ourselves. By the way, five months ago, everybody thought OpenAI was going to run away with this. Google's revenues are very substantial in AI. And by the way, Google, Amazon, et cetera, these companies are producing $100 billion of free cash flow to justify their incremental investment. At the same time, you have these two startups that are still fledgling, that are still fragile in the scheme of things. You of all people should know we've got the best competition in AI on the planet, which is why we're at the frontier and kicking the tail of everybody else on the planet. So I just want to see these companies compete. I want to see DC stay out of the way. The last thing I want to be doing is, you know, seeing people talk about this and throwing roadblocks into the way of the competition.

Chamath Palihapitiya: There's only one person on the planet who has a future pipeline of innovation and the largest TAM in the world because he's playing in all these different spaces that can command that multiple and it's Elon and it's deserved and it's great. The big message that I take away from this, which the markets and retail are telling you is, you guys have stopped innovating. There's a lot of incrementalism. And we as a society aren't benefiting broadly the way that you told us we would be. And so maybe this is the best way for them to get this message, which is to whack their valuation. And by the way, when Tesla and SpaceX merge and we have all things Elon and Elon Corp, which will happen probably by the end of the year, maybe next year, it's going to break everybody's brains again, because you'll have this one asset that will trade at a valuation premium. And I think it's logically explainable, which is everybody else has stopped innovating. People know how to draw more blood from the stone, how to target better ads. That does nothing for society anymore. In fact, it does the opposite.

Jason Calacanis: The big message that I take away from this, which the markets and retail are telling you is, you guys have stopped innovating. There's a lot of incrementalism. And we as a society aren't benefiting broadly the way that you told us we would be. And so maybe this is the best way for them to get this message, which is to whack their valuation. ... If you look at their track record, and I think this is why we had a change there, is they have not done anything innovative. And in fact, the things they were doing that were innovating in AI or self-driving cars, they shut down. They won't take any swing through the bat. So they are getting penalized in their valuation.

David Sacks: Imagine if John D. Rockefeller was way better at public relations. And instead of calling his company Standard Oil, he called it Safe Oil. Okay, let's just play this thought experiment. Clean, beautiful coal. Safe oil. We call it safe oil because as we know, kerosene is dangerous. Their first big product was kerosene. And kerosene can light your house or it can burn it down. And in the wrong hands, it can torch a city or you can use it to make a bomb. So John D, let's say, should have called for the creation of a new government agency to regulate the safety of this product. And they could have done rigorous testing, licensing, common sense regulation. There would have been a very intense debate over safety standards. ... I think people would have gotten so wrapped up in this debate over what constituted safe oil or safe kerosene that they would have missed what was really going on, which is that Rockefeller was building the richest, most powerful monopoly of all time. ... I do think that if you actually look at what a lot of the safetyist policies are calling for, they're basically calling for a form of regulatory capture. And they're calling for things that would create a stronger moat around this monopoly or duopoly.

Brad Gerstner: I talked to Kevin last night after that clip ran. And I asked him, I just said, do you think FDA is the right analog here? And he said, I was only bringing it up to say that we want them to show us the models so that we can coordinate them. Obviously, our job is to make sure that the government is prepared, that we harden our systems, that our intelligence agencies are up to speed. But he does not think, and I can't find anybody on the right, that believes that we're going to move to an approval regime, right? The approval regime, this idea that you're going to have to share every model with an FDA in Washington and they're going to have to pre-approve the model is a disaster. Sachs has been effectively fighting against this correctly over the course of the last year. It would just, it would lead to three bad things. Number one, we do not want to put the Washington in the position of picking winners and losers when it comes to these models. We're winning. We're on the winning horse in America. We're out in front of the rest of the world. There's no reason to change horses and regimes at this point. And we don't want to burden this with more democracy. But at the same time, obviously, I call these pre-AGI or AGI models, Mistral, SPUD, et cetera. I see a lot of coordination going on between the industry and government. I think we can do an even better job of evolving that framework so that everybody in government is on the same page. We need to build more capacity in government to quickly be able to do the cyber review on these models. Right now, it takes too long when the coordination does occur. So we need to have a finite amount of time to get government feedback, et cetera. But the last thing that we want is an FDA of models sitting in Washington.

Brad Gerstner: I talked to Kevin last night after that clip ran. And I asked him, I just said, do you think FDA is the right analog here? And he said, I was only bringing it up to say that we want them to show us the models so that we can coordinate them. Obviously, our job is to make sure that the government is prepared, that we harden our systems, that our intelligence agencies are up to speed. But he does not think, and I can't find anybody on the right, that believes that we're going to move to an approval regime, right? The approval regime, this idea that you're going to have to share every model with an FDA in Washington and they're going to have to pre-approve the model is a disaster. ... Number one, we do not want to put the Washington in the position of picking winners and losers when it comes to these models. We're winning. We're on the winning horse in America. We're out in front of the rest of the world. There's no reason to change horses and regimes at this point.

Brad Gerstner: I talked to Kevin last night after that clip ran and I asked him, I just said, do you think FDA is the right analog here? And he said, I was only bringing it up to say that we want them to show us the models so that we can coordinate them. Obviously, our job is to make sure that the government is prepared, that we harden our systems, that our intelligence agencies are up to speed. But he does not think, and I can't find anybody, on the right, that believes that we're going to move to an approval regime. The approval regime, this idea that you're going to have to share every model with an FDA in Washington and they're going to have to pre-approve the model is a disaster. It would lead to three bad things. Number one, we do not want to put Washington in the position of picking winners and losers when it comes to these models. We're winning. We're on the winning horse in America. We're out in front of the rest of the world. There's no reason to change horses and regimes at this point.