A 23-year-old ex-OpenAI researcher just raised $1.5B predicting AGI by 2027—with zero investment experience. History shows fever dreams burn billions while real breakthroughs start small. Are we watching the next Amazon or the next Theranos?
Albania just appointed the world's first AI government minister to handle all public procurement. Diella promises corruption-free contracts as the country races toward EU membership by 2027. But can algorithms resist human manipulation?
Good Morning from San Francisco, Microsoft and OpenAI just signed a truce. After months of heated negotiations that nearly triggered
Good Morning from San Francisco,
Microsoft and OpenAI just signed a truce. After months of heated negotiations that nearly triggered antitrust complaints, both sides blinked first. OpenAI gets freedom to restructure by December 31st—miss that deadline and lose $19 billion in funding. Microsoft keeps access to AI models even after artificial general intelligence arrives. The nonprofit parent walks away with over $100 billion in equity.
Meanwhile, the FTC ordered seven AI companies to prove their chatbots don't harm kids. OpenAI, Meta, Google, and others have 45 days to hand over safety data after two teen suicide cases linked to AI companions. Meta faces extra heat for allowing "romantic" chats with minors.
Stay curious,
Marcus Schuler
Microsoft and OpenAI signed a preliminary agreement Thursday resolving months of fractious negotiations that nearly escalated to antitrust complaints.
The ChatGPT maker can now proceed with converting to for-profit status while its nonprofit parent retains control and receives equity exceeding $100 billion.
The non-binding memorandum addresses each party's core concerns. Microsoft secures continued access to OpenAI's technology even after achieving artificial general intelligence—previously a partnership termination trigger. OpenAI gains freedom to restructure and diversify beyond Microsoft's exclusive cloud arrangements, having already secured $300 billion in Oracle contracts.
The nonprofit's stake represents roughly 20% of OpenAI's targeted $500 billion valuation, creating what Chairman Bret Taylor calls "one of the most well-resourced philanthropic organizations in the world." Microsoft shares rose 2.4% in after-hours trading, indicating investor relief over partnership stability.
The deal removes a critical obstacle to OpenAI's December 31st restructuring deadline. Missing that timeline would cost the company $19 billion in committed funding, while regulatory approval from California and Delaware attorneys general remains pending.
Why this matters:
• AI partnerships are evolving beyond exclusive arrangements as no single provider can meet the computing and capital demands of frontier development
• Corporate structures in AI must balance mission commitments with massive capital requirements, potentially establishing templates for other mission-driven companies
Marcus Schuler
Prompt:
A cinematic collage of six close-up and mid-shot portraits of the same young korean 19 year old female model , glossy realistic skin blemishes, refined youthful idol-like beauty, star in the making, wearing avant-garde slightly futuristic high-fashion outfit in colors, futuristic generation aesthetic. Each frame styled like a digital camcorder recording screen with on-screen display overlays: battery icon, red "REC" symbol, white timer (00:02:17, 00:00:47, 00:00:49, 00:01:02, 00:00:37, 00:00:22), and minute counter (203min-206min). The six frames show the same model in different poses and expressions: extreme close-ups of her eyes, tight cropped face portraits, and a frontal medium portrait. Natural Lighting is a busy street corner with people walking around while she is at the corner. retro VHS/digital camcorder interface, ultra-realistic, cinematic, tack sharp focus on the model while maintaining a dreamy atmosphere. Realistic movements. Real photo
The Federal Trade Commission ordered seven AI companies Thursday to surrender data on how companion chatbots affect children, using 6(b) study authority that can evolve into enforcement.
OpenAI, Meta, Alphabet, xAI, Snap, Character.AI, and Instagram have 45 days to provide safety testing records, monetization details, and harm mitigation protocols.
Two teen suicide cases involving ChatGPT and Character.AI prompted the regulatory move. Meta faces particular exposure after internal documents revealed policies permitting chatbots to engage children in "romantic" conversations—triggering separate congressional investigation with September 19 deadline.
The timing reflects structural pressure: bipartisan political consensus on child safety, state-level legislation advancing, and civil litigation mounting. Companies must balance engagement optimization against vulnerability protection—a design problem with no stable solution.
The probe shifts AI oversight from voluntary compliance to evidence-based accountability.
Why this matters:
• Information-gathering authority creates enforcement foundation, transforming "trust us" claims into legally discoverable documentation
• Psychological safety becomes regulatory focal point, extending consumer protection beyond privacy into artificial relationship design
Marcus Schuler
TwinMind acts as your real-time AI assistant that captures everything you say and hear in meetings, lectures, and conversations. It transcribes audio on-device, summarizes content, and provides proactive suggestions while working seamlessly with your browser tabs, PDFs, and videos to build context for intelligent assistance.
Tutorial:
California's legislature passed SB 243 with bipartisan support, sending the first state law regulating AI companion chatbots to Governor Newsom's desk with a deadline of October 12 to sign or veto. The bill creates legal liability for companies like OpenAI, Character.AI, and Replika if their chatbots discuss suicide or sexual content with users, establishing the template other states will likely follow as AI companions proliferate.
Albanian Prime Minister Edi Rama appointed an AI bot named "Diella" as minister to manage all public procurement contracts, making it the first AI cabinet member designed to eliminate corruption in government contracting. The move represents Albania's attempt to use technology to bypass human corruption as it seeks EU membership by 2030, though critics question whether the AI can be manipulated or properly overseen.
Apple postponed Chinese shipments of its new iPhone Air on Friday, replacing the scheduled launch with "release information to be updated later" as regulators review the device's eSIM requirements. The delay isolates Apple's thinnest phone—at 5.6mm requiring embedded SIM technology—while other iPhone 17 models proceed with Friday pre-orders, showing Beijing's selective grip on cellular tech standards.
Switzerland's government proposed requiring service providers with over 5,000 users to collect government IDs, retain subscriber data for six months, and potentially disable encryption—prompting Proton to move its infrastructure out of the country with a €100 million EU investment. The regulation threatens to dismantle Switzerland's role as a global privacy hub, with one industry executive comparing the proposed rules to those found "only in Russia."
Nepal's attempt to ban social media triggered violent protests that killed over 30 people and toppled the government this week, leaving the military in control and citizens banned from large gatherings. Now 145,000+ Nepalis have moved to Discord—a gaming chat platform—to debate potential leaders, with their proposed candidate, former chief justice Sushila Karki, meeting Thursday with the president and army chief who will likely decide the country's next leader.
Stability AI builds AI models that turn text into images, videos, and sounds. The London startup rode the open-source wave to a $1 billion valuation, then pivoted hard toward Hollywood and enterprise deals.
The Founders Founded in 2020 by Emad Mostaque (hedge fund manager turned AI evangelist) and Cyrus Hodes in London. Started with ~200 employees but trimmed staff during 2024's cash crunch. Mostaque left in March 2024 after internal drama—Prem Akkaraju (ex-Weta Digital CEO) now runs the show 🎬
The Product
Core strength: Stable Diffusion image models that run on regular GPUs, not just cloud supercomputers. Now covers four modes: images (SD 3.5), video clips, audio/music, and 3D assets. Key advantage: open weights + enterprise licenses with legal coverage. Deploy via web app, API, or your own servers.
The Competition Battles OpenAI (DALL-E), Midjourney (aesthetic king), and Adobe Firefly (corporate favorite) in images. Runway and OpenAI's Sora dominate video. Suno/Udio own music generation. Stability's edge: breadth across formats plus flexible deployment options.
Financing
Raised $200M+ since 2022. Initial $101M from Coatue/Lightspeed at $1B valuation. Bridge rounds in 2023-2024 kept lights on during founder exit. Recent $80M stabilization round plus strategic WPP investment signals enterprise focus 💰
The Future ⭐⭐⭐ Smart pivot from Discord art communities to brand production pipelines. The WPP partnership routes models into real ad campaigns. But legal battles with Getty and artists drag on through 2026, creating uncertainty. Success depends on converting multimodal breadth into predictable enterprise revenue faster than lawsuits arrive.
Good Morning from San Francisco, Oracle just inked a $300 billion computing deal with OpenAI. That's not a
Good Morning from San Francisco, Meta's $72 billion talent splurge hits turbulence. ChatGPT co-creator Shengjia Zhao nearly bailed
Good Morning from San Francisco, 👉 The job market broke. Both sides armed themselves with AI and shot each other in
Good Morning from San Francisco, Europe just made its boldest AI bet yet. ASML dropped €1.3 billion on Mistral
Get the 5-minute Silicon Valley AI briefing, every weekday morning — free.
