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Chamath Palihapitiya
@chamath
Social Capital 8090 God is in the details.
1.1K Following    2.3M Followers
Making progress every week… Try it here:
Power is THE binding constraint. Data centers are being shut down, GPUs are sold out, models are being commoditized and spot rates are rising all leads to power being critical. Not fanciful plans for power, future forecasts of BTM or distributed batteries blah blah blah but energized power today. This means the following hierarchy is developing from greatest to least value: 1. Hyperscaler 2. Neocloud 3. Model maker Ideally, you are 1+3 (Google, SpaceX, Meta) where you own massive power today and have a leading set of models to keep API pricing from 3rd parties honest enough to benefit them vs the model maker. But even if you are just (1), you can still extract great economics from (3) because owning the power is the leverage. This means (2) needs to scale up fast. If Neoclouds do not scale up fast and move up the value stack towards hyperscalers (solely measured by energized compute online today) they are going to leave a lot of revenue on the table which will complicate their long term financing plans. Also, starting now, a neocloud’s real competitors will be well capitalized frontier model companies who will do sweetheart deals with (1) and/or will vertically integrate and try to become (1). You can see this in the fact pattern (Ant+AWS, OAI+Stargate). Get your hands on power. It’s the spice.
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I remember it well.
In re-sharing this post, I went down a rabbit hole on the Empire State Building. It was built in 1930 in 410 days and landed under budget, despite having none of our modern-day advantages or technologies. As a corollary, the World Trade Center broke ground in 1966 and took 7 years to build. The ESB is ~1,250ft to roofline, the WTC was ~1,370ft to roofline. The ESB did it by subordinating every design decision to speed: - No exotic materials or systems were used; just known steel, floor, and window systems - Window placement, stone thickness, and cladding attachment were all chosen to minimize on-site cutting and hand-fitting - Engineers explicitly designed systems so trades could work independently and in parallel without waiting on each other, reducing the risk of delays - Demolition started before design was finished, foundations were poured while upper floors were still being designed, steel was ordered a month ahead of need - The owner, architect, engineer, and contractor sat together through construction, resolving details jointly instead of each one handing off their piece independently - On-site narrow-gauge railways, dedicated hoists for brick and stone, and on-floor cafeterias removed friction from moving material and people Interestingly, the profit-maximizing design was determined to be 63 stories, but they built it to 85 stories for prestige and to beat Chrysler. Speed discipline saved the vanity height economics. For contrast, the WTC took over a decade because it was plagued by lawsuits, political fights, and novel/untested systems, the reverse of the ESB's playbook. Lots of learnings for startups, both inside the building (focus, parallelizing vs serializing, etc) and outside the building (regulatory, etc).
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Tactical Game Theory: Meta Scorched Earth This should have been Meta’s play two years ago. That said, they are in an even better position to do it now considering the power and compute constraints that are emerging.
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Muse Spark 1.2 just cracked the top 5 on the Vals Index, at just $0.69 per test. This is 3x cheaper than Kimi and 10x or more cheaper than Fable, Opus, and 5.6 Sol.
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As said earlier, AGI is now at hand so these moves are logical.
NEW: Google DeepMind CEO Demis Hassabis is stepping down
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Pretty cool.
Today we're introducing Hark Handoff Handoff has been independently verified as the best internet-use model ever built, outperforming ChatGPT 5.4 & Opus 4.8 While others focus on coding, we focus on everyday life: ordering food, booking flights, shopping, & navigating the web
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In a world of agents + harness + application, bottoms up will turn out to be the worst strategic GTM decision of the past decade. Over the next few years, AI will stamp out clone after clone of various bottoms up tools, meanwhile this same tool sprawl will be viewed as part of the AI sovereignty debate (ie leaking your alpha into the AIs of point solutions by some random employee on your team) and will cause bottoms up adoption to largely be stamped out in favor of top down. The final nail in the coffin will be CFOs wrapping corporate cards with smart filters so any tool that has downstream IP/alpha leakage won’t be authorized anyways.
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A meme has to travel far to reach my wife…
The Creation of Chamath And on the seventh day, the final ring was completed.
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@zerohedge this happened in the very early days of tesla as well. they went broke.
🐐 Congratulations @JasonKoon!!!
For nearly two decades, @JasonKoon has defined excellence on poker’s biggest stage. At just 40 years old, he is already one of the most accomplished high stakes tournament players in history. His résumé includes more than $14.8 million in WSOP earnings, two WSOP bracelets, and third place on poker’s all time money list. One of the most respected players of his generation joins poker’s immortals. Welcome to the Poker Hall of Fame, Jason. 👏🏽
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If you are an enterprise product or engineering leader evaluating Software Factory, come join our Q&A on Aug 12.
If you are an enterprise product or engineering leader evaluating Software Factory, come join our Q&A on Aug 12. @melbourneandrew, Head of Engineering for Software Factory, takes your hardest questions live. 1 hr (9am PT/12pm ET). Register here:
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The Build vs Buy Math Just Flipped For thirty years a software renewal was a simple question of renew or shop for a cheaper seat, because building the thing yourself was never realistic. That has changed. Gartner now puts roughly a fifth of enterprise SaaS spend, around $234B, at risk of being done a different way by 2030. The reason is that the cost of building the workflows a company actually needs can now be done with tools like Software Factory. Keep renting commodity systems, and your business will perform like a commodity. Building software around the processes that are unique to how your business runs is worth pricing out before you sign another three-year contract for some off the shelf tool that will only ever approximate it.
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If I were the company on the right I would try to kill every company that is like the one on the left. This way, the company on the right can make trillions of dollars and then infect American politics with hundreds of billions of dollars to implement their vision of being the sole judge, jury and executioner of future progress.
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Imagine if you priced by the token…hey! Wait a minute!!
This chart says so much.... - Literally the exact same prompt. - All long horizon one-shots. - Totally reflects real-world experience.
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The AI Singularity The argument goes like this: 1. Humans build an AGI. 2. The AGI becomes good at AI research. 3. It designs a smarter AI. 4. That smarter AI designs an even smarter AI. 5. The cycle repeats faster and faster. Looking at the results and capabilities from the various labs over the past few weeks I would say we are firmly in this loop now. The next 18months will be wild. Recursive self improvement will dramatically increase capability very quickly from here. Marginal costs of all models will go to ~$0.
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Very impressive.
📢Meet Qwen3.8-Max — our most capable model to date. Next week, the open weights of Qwen3.8-Max will be released, and Qwen3.8-27B is also going open-weights to meet you all!🎉 Qwen3.8-Max, a new bar for coding and cowork at 2.4T parameters: - Autonomous coding: 10+ days of self-evolving development, from empty folder to production without hand-holding, complete project trace in the GitHub: - Real work, real results: Production-quality deliverables across hundreds of professions. - Long-horizon mastery: System-level autonomous planning with closed-loop adaptive learning, driving 500+ turns of chip design optimization and 365 days of e-commerce strategy. - Native multimodal intelligence: Vision isn't just input — it's a continuous feedback loop for planning, execution, and self-correction. 💰Pricing: Input: $2.0 / M tokens Output: $6.0 / M tokens Implicit Caching: $0.25 / M tokens Start building with Qwen3.8-Max! 🚀 📖 Blog: ✅ Qwen Studio: ⚡ API:
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Some are saying prices are going to continue to go way down…
People keep asking why DeepSeek’s API is so cheap. Some even make absurd claims that they’re dumping prices to corner the market. No, the answer is simple: their model size is ridiculously small compared to its performance. It's 10x smaller than Opus, and 5x smaller than Sonnet. That means what used to require an 8-chip node can now run on a single chip. And because it's so small, it runs extremely fast. You can multi-serve multiple users from a single chip while maintaining decent speeds. By my math, they can handle 40x~ more traffic than Opus using the exact same compute. This is where the competition is heading, and it’s why they can stay profitable even at these crazy prices.
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The resolution of this trillion dollar bet will happen before EOY 2026. Stakes are enormous on the outcome. Path1: Markets price the Ant IPO and public valuation answers this question. Path2: Harness + Open Model math becomes more precise and well known. It shows material token efficiency. Model forward valuations changes independent of current revenue run rate. Path3: Open Models pressure proactive price cuts and performance improvements on token efficiency from the frontier labs. This resets the Pareto frontier. If I had to guess, valuations were most skewed and top ticked in Feb. Valuations can still rise from here but it will be less skewed and will be measured more precisely on an EV/MW basis.
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Chamath says OpenAI and Anthropic could be $5 to $10 trillion companies each if they remain a duopoly "I suspect revenues are going to crank at OpenAI and Anthropic and the open labs for a while. But again, that's not the important thing." "If you're thinking about valuation, the markets will look five to 10 years out to answer that question, they're not going to give you a premium valuation on something that they feel could be fragile in the first two to three years." "Somebody has to answer that question precisely. Because if the answer is that it is a duopoly, then there is no risk to the revenue five to 10 years from now, these things are $5 to $10 trillion companies each." "But if there are harnesses that cut the token consumption, because you stop wasting tokens to get to the same output, then it's a little bit more of a question mark. And I think that'll need to get sorted out."
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This is accurate. That said, we are currently working through a rigorous experiment testing closed and open models with and without Software Factory. Early data is super fascinating and backs up the experiment below.
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Turns out you can’t build a monopoly on intelligence. Which we would have known simply by looking at humanity.
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