Founders & Operators: The Winds of Winter | Upcoming Events

The Winds of Winter, jitters in the AI trade, upcoming NYC events, and: Founders & Operators goes Financial Times.

THE WINDS OF WINTER - CRACKS IN THE AI STORY?

It is late October, and while we can still enjoy the sunshine, reasonable temperatures, and fall foliage, winter IS coming. In markets, we already started feeling the Winds of Winter over the last two weeks, with some serious jitters in the AI trade. With the Fed raising rates and bond yields rising on the back of inflation, macro uncertainty, and the ongoing Iran conflict, there are players with high debt and financing needs that are starting to feel the squeeze…

Enter Coreweave, whose financing cost surging to 16% definitely had people pay attention (and sent the stock tanking). There is an increasing consensus that neoclouds depend on a continued flow of cheap financing to even survive. Gartner’s bleak assessment of the survival odds for neoclouds (‘80% of them will not survive’) was a bit of a wake-up call and certainly made a splash.

And then there’s the question of, will Anthropic be able to pull off an IPO before Thanksgiving? Rumor has it that Anthropic will file the required paperwork tomorrow, for a target go-live date around November 10. If that materializes, and goes smoothly, the show will go on. We’ll be able to avoid a harsh AI winter.

My take: Pending any major disruptions, the IPO might not happen at a $2 tn valuation, but it will go ahead, and it will go reasonably well. Even at $1.3 tn, that will give everyone 2-3 months of runway, and room to breathe by lifting sentiment and injecting cash into the system.

If things were to go south from here, the ripple effects would be dramatic. Even Anthropic’s revenue growth slowing down in Q3 (considerably) had Wall Street pretty nervous. So if you’re not a fan of disruption, keep your fingers crossed for Dario. His failure, or success, will have massive ripple effects. He’s got the whole world in his hands.

In this equation, the outcome of the midterms probably doesn’t matter too much. They are interesting to follow, and AI does play some role in some conversations - especially in states with strong AI (data center) exposure - but relative to affordability and other key concerns, AI is not top of mind for Main Street. To put numbers on it, the state of the economy, according to one poll, is a top concern for 85% of voters, while AI scores only 35%. There is an argument to be made that AI is intertwined with the affordability issue, but that’s a conversation for another day…

F&O San Francisco: We’ll be spending time in San Francisco in the coming weeks, so if you’re in SF, come say hi. If you know of great communities or founders we should be meeting, get in touch - we’ll also try to put together an event or two. ([email protected])

WhatsApp Community: Join our group chat on WhatsApp where we discuss the macro, the micro, and everything in between. This includes sharing resources, exclusive offers, and upcoming events. Preference is given to people who have attended an event previously. Join here.

Founders & Operators x Financial Times: Stephan’s startup RegLayer received a shoutout on Monday’s Financial Times front page. Check out the article here. If you want talk more about data center policy, local permitting, current project delays, or AI for policy, say hi at [email protected]. Congrats!

See you soon,

Stephan, Jacqui & the F&O Team