MORE OR LESS — Stripe Buys an '$7B Apple Tree' - OpenRouter, OpenAI vs. Anthropic vs. Uber vs. Lyft without Network Effects & the AI Consumer Indifference vs. Hatred — the OG crew was back on More or Less this week and we got into Stripe paying $7.5B for OpenRouter... which is 7x what Instagram sold for, for a router…. sure marketplaces are valuable and you would rather be the high-margin man-in-the-middle (especially when you get to look at all the transactions) vs. actually dealing with the pork bellies… BUT is there anything here that others can’t build on their own / won’t? And in a world where it is free to participate in ALL the markets at the same time, is any one apple-tree to trade under valuable? … or maybe it is just free momentum in a world where marketing matters and who cares because number-go-up. "the backlash is not about the data centers. the backlash is about that AI sucks, and it is inhuman." Nobody's lead is safe right now: "it doesn't matter who's in the lead right now. what matters is that no lead is secure, and projections don't mean anything." Also covered: Anthropic's enterprise/Microsoft strategy vs. OpenAI's consumer play, why nobody can price these companies when quarterly revenue swings this hard, and Josh Kushner + Thrive buying the Lakers doing the Left-or-Right not straight thing. Listen to the full episode →
HOT TAKES
- A16Z's DOJ probe is a marketing masterstroke — did a16z convince the DOJ to "probe them for being a monopoly"... because that might be the smartest / best marketing a venture firm has ever pulled off… Andreessen is rumored to absolutely LOVE conspiracy theories (along with a lot of tech execs)… this would be a great one to pull off. Sequoia has to be green with envy, and I for one would love to be sued for monopolistic practices on seed investing.
- Crypto might be a hedge after all? — for a while now the ‘crypto is the most risk on’ asset has dominated the ‘crypto as a hedge’ narrative — the money flowing out to other risk on AI bets (not to mention data center capacity and compute!) has been the story… but with $40B in debt milestone, an $4B in buybacks (lol, 1/3rd of a Lakers)… maybe we get a hedge story back?
- Welcome to our new LinkedIn employees, and good luck withe Anti-Harassment Training — the highest form of flattery is people on LinkedIn deciding to pretend to work for you. Even more than the government probing you?
- "touching grass" becomes a luxury good — new investment thesis: "touching grass" will become the ultimate luxury. People will pay more and more for luxury grass experiences… I kid, because hilariously we are literally looking at a luxury grass deal (don’t worry LPs, I won’t do it JUST because it is hilarious… that will only be the bonus)
- Nothing is more insulting (or less profitable) than participating in a market. — I have made this point repeatedly about VC… but let’s talk about routers and AI — anthropic and openai can do a lot of ‘revenue’ being big on a market, but the second you can be put in the back of the wallet and marketized… you are part of g-ds work of capitalism, but you are no longer able to be very profitable if you are put into a tradable box. That is the ultimate irony of capitalism (and good part) — good markets ring all the profit out and hand it to the consumer, yet value is created by doing things so uniquely and extraordinarily you can’t be put into a market (bro)
- What percentage of your net worth are you commutable holding in memes? .. and by memes I mean ‘stories’ vs. things that produce cashflows… it shouldn’t be zero.. but is there an amount that is ‘too much’?
- the subscription-cancel feature everyone actually wants — I figured out I was paying Adobe $60 a month… and lots of other hilarious and annoying recurring charges recently — the ‘one click’ / simple unsubscribe laws are one thing (and hard to operationalize, and only works when you even know all your account logins, etc. which I don’t managing a household…) … What I really want is a credit card which gives me a dashboard where I can cancel directly from the card dashboard. Seems like others would as well.
- CNBC this week to talk Anthropic vs. OpenAI — Anthropic's Q2 revenue run-rate is now ahead of OpenAI's, which basically nobody would've called a year ago…. And here is the PR problem I can’t figure out… narrative one is that AI isn’t winner take all / it is an ecosystem… always competitive, largely low margin, etc. in which case AI companies can be big but not return-on-scale internet growth tailwind network business profitable… (bad for openAI)… narrative two (which is what they sold)… is this is pure race, winner take all, etc.. where you own the whole economy… but now that that isn’t them / that narrative serves anthropic? What story do you tell now?
- We’re number /ninity/ one. In the new sport of outrage lists that drive clicks … Time just had a strong showing… honored to be number -ninty- one… lol. But here we are, so it is working… now you just have to have some bribery issue like Forbes… also HT to Forbs for the zero-f-s given lean in on 50 over 50. Hilarious.
- Fin analysis — super fun to find old pitch decks form Fin Analytics… where we were recording years ago 10K+ operations agents continuously screen + full DOM clickstream to optimize (and automate work… always fun to see these old narratives that now are so cool years later.. some of the marketing would still really work for the right team, just saying.
Best,
Sam
P.S. Brain Donors… the 1992 Classic — this is an incredible movie… I loved it as a kid (got it on VHS from some Hollywood exec in a box set sent to my dad)… my mom reminded me … showed it to the kids and I have never heard them laugh this hard. Truly the pinnacle of comedy.
P.P.S. So happy that Johnny is uncanceled and Jack Sparrow may sail again — without a doubt the worst pirate… you have ever heard of.