There's No Crying In The Casino
Welcome to Cautious Optimism, a newsletter on tech, business, and power.
Wednesday! Once again, folks are worried about AI. Shares of Nvidia dropped yesterday after OpenAI’s Sam Altman said that the AI industry is in a bubble and lots of folks will lose their shirts. That shockingly unsurprising pronoucement was still enough to rattle investors. ARM also lost ground, as shares of American AI intelligence firm Palantir fell more than 9% yesterday, cutting into its recent gains.
A recent, viral MIT report arguing that nearly every AI pilot fails didn’t help sentiment.
Elsewhere, Elon Musk has given up on its plans to create a new American political party, likely to maintain ties with VPOTUS. Recall that Vance is part of the larger PayPal mafia universe, along with Musk, Peter Thiel, and David Sacks. The group made a large bet backing Trump and helping to get their guy into the copilot seat, after all. Now, to work! — Alex
📈 Trending Up: Excel … Baidu revenues … raising nine-figures … Target sales … Firecrawl … state-based stables? … women’s sport … the prices of lies …
📉 Trending Down: fiat? … free AI in India … closed app stores in the EU … democratic guardrails … groundwater supply in Texas … international students … shock …
Quick Hits
Databricks confirms new round: As expected, the data/analytics/AI giant has raised a Series K that pushes its worth above the $100 billion threshold. Behold, a centaur. In a post claiming that the round “over-subscribed,” Databricks stressed future investment in AI, including Lakebase (serverless Postgres with seperated storage/compute, which is great for AI agents), and Agent Bricks (no-code AI agent builder for enterprise). So much for worry about AI spend?
Canva’s worth rises: In a new employee tender offer, the value of Australian design startup Canva rose to $42 billion. The offering comes after American design company Figma went public to great effect. After a giving back some of its post-IPO gains, Figma is still worth more than double its IPO price. Private-market investors are content to award Canva a higher valuation than Figma currently sports ($33.8 billion), setting us up for a fun corporate race to watch over the coming years.
Canva’s revenue reportedly came in around the $3 billion mark last year. At Figma’s current 37.89x price/sales multiple (Yahoo Finance data), Canva would be worth north of $100 billion.
Aalo raises $100M for microreactors: Instead of bringing your data center to a power source, why not bring a power source to your data center? Aalo just raised $100 million to build small nuclear reactors. It plans to “flip the switch on its first reactor in the summer of 2026,” TechCrunch’s Tim De Chant reports. Best of all? It’s going to have a data center plunked right next to its prototype reactor. Gimmick or not, that’s called knowing your customer.
Manus reaches $90M run rate: Butterfly Effect, a formerly-Chinese-and-now-Singaporean startup best known for its ‘general’ Manus AI agent, has reached an annualized revenue run rate of nearly $100 million. Given how recently it turned on monetization (late March), that’s one hell of a run. Good job, Benchmark!
Before we get to our main work today, recall that we argued yesterday that the Trump administration would not stop at Intel, and would likely demand equity stakes from other grantees under the CHIPS Act. We were correct. Here’s Commerce Secretary Howard Lutnick via CNBC:
The Biden administration literally was giving Intel for free, and giving TSMC money for free, and all these companies just giving them money for free. Donald Trump turns that into saying, ‘Hey, we want equity for the money. If we’re going to give you the money, we want a piece of the action.
Surely when it comes to turning government largesse into equity stakes, surely we’re about to get major stakes in domestic oil companies? And farms?
The Chamath Palihapitiya Cinematic SPACtaverse
“There's an old saying in Tennessee — I know it's in Texas, probably in Tennessee — that says, fool me once, shame on — shame on you. Fool me — you can't get fooled again.”
Chamath Palihapitiya is back in the SPAC game. Please say hello to American Exceptionalism Acquisition Corp. A, presumably the first of several fresh SPACs from the American financier, which wants to raise $250 million in an upcoming public offering.
As with all SPACs, the company will pursue a merger or similar with a private company, taking the second entity public in the process. As you surmised from the name of the SPAC, Chamath is beating the patriotism drum. To that end, the SPAC will hunt for a partner company in the areas of energy production, AI, decentralized finance, or defense. That’s not an unreasonable investment target list given today’s market, which is focused on AI infra and its constituent power demands, crypto, and guns.
The American Exceptionalism SPAC also changes up how Chamath might profit from the endeavor. Seemingly aware of criticism of the performance of some of his prior SPAC deals, Chamath wrote that “to provide greater alignment with my investors,” he has “dramatically reshaped and restructured the sponsor’s economics.” What does that mean?