It’s Tuesday. We are live.
The current thing is Sam Altman being a legendary dealmaker.
Let’s get to it.
Today’s lineup
Anduril and ModRetro founder Palmer Luckey at 12:00 PM
Coinbase cofounder and CEO Brian Armstrong at 12:45 PM
Airbnb CEO Brian Chesky at 1:00 PM
Samsung Head of New Business Development Daniel Glassman at 1:50 PM
LangChain cofounder and CEO Harrison Chase at 1:55 PM
Seneca founder and CEO Stuart Landesberg at 2:00 PM
Run of Show: The Duopoly Thesis
Berber Jin dropped a long post in the Wall Street Journal tying together a bunch of different OpenAI deals. It really shows the power of Sam Altman as the preeminent deals guy of the modern era. Some of the deals are so good, the timeline is wondering if Sam is just so good at deals that his counterparties are making mistakes by tying their fortunes so completely to OpenAI’s aggressive forecasts. The fox in the henhouse analogy is too funny to pass up, but even if OpenAI ends up getting the fox’s share of value from deals with Nvidia, AMD, Oracle, and Softbank, I don’t exactly feel bad for Jensen, Lisa, Larry, and Masa. The primary job of a CEO is to defend the henhouse from foxes!
I don’t think Sam has gotten any foxier now that he’s in his fourth decade. He’s always been a great dealmaker. The reason everything has three extra zeros after it now is because he has more leverage than probably anyone in recent business history. Jordi has been saying “You should think of OpenAI as a new hyperscaler,” and to take that a step further, you need to consider Thiel’s monopoly thesis: “Monopoly is the condition of every successful business.”
Sam Altman deserves a Stratechery medal of freedom for creating a new aggregator. ChatGPT has captured enough of the consumer market that it now controls demand at a very high level, and that affords them an incredible amount of leverage in every negotiation. Ben Thompson was road testing the idea that OpenAI could even swap out the underlying model and still accrue the vast majority of the value. (i.e. hypothetically ChatGPT powered by Gemini or Claude would not see declining user numbers or monetization).
So if OpenAI is potentially going to be successful in building a monopoly at the consumer AI layer, what’s the strategy for the supply chain? Time for the duopoly thesis. Ideally you want to “commoditize your compliments,” as Joel Spolsky put it in 2002. That means deals with multiple cloud partners (Microsoft, Oracle, etc), multiple data center builders (Oracle, CoreWeave, Nscale, Crusoe, etc), GPU designers (Nvidia, AMD), and maybe even foundries (TSMC, and hopefully Intel soon).
Not every link in the supply chain can be completely commoditized. Nvidia has an insane amount of power, having ramped full-year revenue from $27B in 2023, to $60B in 2024, to $130B in 2025, all while growing net profit margin from 16% to 56%. All the hyperscalers (and OpenAI) are sort of incentivized to form a bit of an anti-Nvidia alliance to commoditize the accelerator market and drive down those margins a bit.
Berber dropped a big scoop in the WSJ piece: “As part of the deal, Nvidia is also discussing guaranteeing some of the loans that OpenAI plans to take out to build its own data centers, people familiar with the matter said—a move that could saddle the chip giant with billions of dollars in debt obligations if the startup can’t pay for them.” Sounds like the fox has leverage to me!
Dual sourcing is nothing new, it’s best practice, but we haven’t seen a push like this happen so fast before. Exerting pressure so deep into the supply chain is a hassle usually and something tech CEOs only do when they are backed against the wall. Single points of failure creep up unexpectedly. Just look at Apple in China, it didn’t feel all that important to have geographically distributed manufacturing operations in 2005!
It’s a great time to be a key player in the AI buildout, but you do have to be wary about letting the fox commoditize your henhouse.
— John
Headlines
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➞ Announces return of crypto podcast ‘Up Only TV’…
Stripe Atlas now allows founders to raise directly on its platform…
Paper allegedly shows AI can get brain rot when trained on shortform content…
The timeline is in turmoil as Sacks and Hoffman continue to trade barbs over Anthropic…
TechCrunch: ChatGPT’s mobile app is seeing slowing download growth and daily use, analysis shows…
ChatGPT announces AI browser “Atlas”…
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