December 5th Newsletter

Holiday shopping surged as Cyber Monday hit $13.3B and Black Friday $11.8B, driven by mobile, BNPL, and an 805% spike in AI-led traffic. Travel also hit records, with 3.13M people flying Sunday, the busiest air travel day ever. Meanwhile, ADP reported a 32,000 drop in private payrolls, the steepest in over two years, highlighting mixed labor signals. National security concerns flared as VC Keith Rabois labeled Airwallex a “Chinese backdoor” over data access risks. In tech shifts, Apple’s longtime UI chief Alan Dye is heading to Meta. Regulatory pressure intensified as the EU fined X $140M under the DSA and opened a probe into Meta over WhatsApp AI terms. On the innovation front, Walmart is pushing ahead with drone delivery via Wing, launching in Atlanta and eyeing expansion to Charlotte, Houston, Orlando, and Tampa. Eventbrite is set to go private in a $500M deal with Bending Spoons.

Top 5 AI Highlights

[1] 🤝 OpenAI takes ownership stake in Thrive Holdings to embed AI in enterprise sectors, starting with accounting and IT. Separately, OpenAI is acquiring Neptune, a startup aiding AI model training with debugging tools. Neptune will cease external services, integrating its systems into OpenAI’s stack. See more on OpenAI and CNBC.

[2] 🚨OpenAI’s lead is eroding as Google’s Gemini 3 surpasses GPT-5 and hits 650M monthly app users, while OpenAI faces soaring costs, talent strain, and a risky $1.4T compute build-out. Related to this, OpenAI CEO Sam Altman declared a “code red” to enhance ChatGPT, delaying ads and AI agent efforts while prioritizing reasoning models and image-generation improvements. More from Financial Times and The Information.

[3] 🏛️ Anthropic has hired Wilson Sonsini for IPO prep amid a $300–$350B valuation push, aiming to outpace OpenAI. Investors expect a 2026 listing, though internal views on timing remain mixed. Details on Financial Times.

[4] 🍎 Apple faces its biggest leadership shakeup since Steve Jobs’ death, with exits across AI, design, legal, and operations. Amar Subramanya replaces AI chief Giannandrea to help Apple’s struggling AI amid rising pressure. More on TechCrunch and Forbes.

[5] 🤖 Amazon unveiled three “frontier agents,” led by Kiro, an autonomous coding agent that learns workflows and operates for days, automating coding, security, and DevOps tasks to enhance productivity and reduce manual oversight. Details on TechCrunch.

✨Open Source AI Development

[1] 🚀 DeepSeek released open-source V3.2 and Speciale models rivaling GPT-5 and Gemini 3 Pro, winning 2025 Olympiad gold, at $0.28 input / $0.42 output vs. GPT-5.1 ($1.25/$10) and Gemini 3 ($2/$12). Details from DeepSeek.

[2] 📡 Mistral 3 debuts as an open-source, multimodal AI family with a 675B MoE model and performant 3B–14B dense variants. Optimized with NVIDIA tech, it delivers frontier performance, multilingual reach, and scalable efficiency. See more on Mistral.

[3] 🚗 NVIDIA unveils Alpamayo-R1, the first open reasoning VLA model for autonomous driving, plus new open-source AI tools for speech, safety, and robotics, advancing digital and physical AI at NeurIPS 2025. More on Nvidia.

[4] 🛠️ Tether Data launches QVAC Fabric LLM, an open-source, edge-first framework enabling full LLM inference and LoRA fine-tuning on consumer devices, bringing decentralized, privacy-first AI to smartphones, laptops, and GPUs. Details on Tether.io

[5] 🧠 Arcee AI launches Trinity Mini and Nano, U.S.-trained open-weight MoE models under Apache 2.0, advancing model sovereignty, long-context reasoning, and enterprise-grade open-source AI amid rising global competition. More on VentureBeat.

Founder’s Corner

What We Read and Watched This Week

• Watch: Ilya Sutskever discusses “We're moving from the age of scaling to the age of research” in an interview with Dwarkesh Patel. (YouTube)

• HSBC warns OpenAI may stay unprofitable through 2030, facing a $207B funding shortfall and $792B in infrastructure costs, while partners like Oracle and SoftBank shoulder nearly $100B in debt-fueled AI expansion. (Fortune and Financial Times). 

• New York’s new AI law mandates disclosure when algorithms use personal data for pricing, making it the first state to regulate personalized pricing and setting the stage for broader US AI regulation battles. (NY Times)

• MIT’s Project Iceberg finds AI can already automate 11.7% of US jobs, affecting $1.2T in wages. New protocols like MCP expand AI’s reach beyond tech, putting cognitive roles nationwide at risk. (MIT)

• Nvidia invests $2B in Synopsys to co-develop AI-powered chip design tools, aiming to shift industries toward GPU-based workflows. Deal is non-exclusive; Synopsys remains open to other chipmakers. (Reuters)

• David Sacks, Trump's A.I. and crypto adviser, shaped policies benefiting his 700+ tech investments and allies like Nvidia, prompting ethical concerns over conflicts, influence, and $200B+ in potential profits (NY Times)

• Moore Threads, a 2020-founded AI chipmaker by ex-Nvidia execs, soared 425% in its Shanghai debut after $1.13B IPO, spotlighting China’s tech independence push and surging investor demand for AI. (Yahoo Finance)

• Netflix to acquire Warner Bros. Discovery’s film studio and HBO Max for $72B in cash and stock, outbidding Paramount. Deal expected to close in 12–18 months, pending regulatory and shareholder approvals. (CNBC)

• Top consultancies like McKinsey and BCG have frozen graduate salaries for a third year as AI reshapes hiring, reduces junior roles, and challenges the traditional pyramid structure with automation-driven efficiency. (Financial Times)

• Goldman Sachs to acquire Innovator Capital for $2B, expanding its defined-outcome ETF offerings and asset management footprint. Innovator oversees $28B in assets across 159 ETFs. Deal closes Q2 2026. (CNBC)

AI Fundraising News (Nov 26 — Dec 4)

• 7AI: Makes agents that triage cybersecurity alerts, raised a $130M Series A

• Angle Health: AI-native health benefits platform, raised a $134M Series B

• Antithesis: Software testing and validation startup, raised $105M

• Axiado: Chip designed to save space and power in AI servers, raised $100M

• BHub: AI-supported accounting services for Brazilian entrepreneurs, raised $10M

• Black Forest Labs: Foundation AI models for image generation/editing, raised a $300M Series B

• Clover Security: Embeds AI agents into dev tools for product security, raised $30M

• Databricks: AI-powered data analytics and lakehouse platform, raised a $5B Series I

• Flex: AI-based payment and credit tools for businesses, raised a $60M Series B

• Fortell: AI hearing aid startup for affluent clients, raised $150M

• Gradial: Agentic tools for enterprise marketing automation, raised a $35M Series B

• Gradium: AI voice startup spun out of Kyutai lab, raised $70M

• Harvey: AI legal software startup, raised $160M

• LizzyAI: AI-driven interviewing system with role-specific assessments, raised a $5M Seed

• Lumia: AI analyzing human-autonomous agent interactions, raised an $18M Seed

• Minitap: Helps engineering teams build mobile features with AI, raised a $4.1M Seed

• Moore Threads: Chinese AI chipmaker, raised $1.13B

• Nevis: AI platform for wealth management, raised a $35M Series A

• Orq.ai: Helps enterprises scale and monitor AI agents, raised a $5.8M Seed

• Phia: AI search engine browser extension startup, raised $30M

• Range: AI-driven flat-fee financial planning services, raised a $60M Series C

• Simular: AI agents that operate Macs and Windows PCs, raised a $21.5M Series A

• Sober Sidekick: AI platform to prevent substance-use relapse, raised a $7.6M Seed

• Supper: AI-driven data platform to clean and normalize company data, raised an $11M Seed

• Trial Library: AI-enabled clinical trial access platform, raised a $10M Series A

• Tutor Intelligence: AI-powered warehouse robots, raised a $34M Series A

• Unlimited Industries: AI to design and build infrastructure projects, raised a $12M Seed

• Vinci: AI simulations for hardware design, raised a $36M Series A

• Zafran: AI-native threat exposure management service, raised a $60M Series C