Anthropic S1 Leaked, ElevenLabs Hits $22B, Oura Pulls $2.2B IPO & How Midterms Will Impact AI

Dave McClure (0:00)

Anthropics S1 was leaked, could still be valued at more than 2 trillion, but they lost 42 billion in 2025

Aman Verjee (0:07)

There's definitely a safety issue. I think we've seen enough to know that these models are getting out of their harnesses.

Dave McClure (0:12)

Smart read maker Oura recently ended up that they were pulling their IPO.

Aman Verjee (0:17)

They were aiming between 13, 15 billion, that's 40 to $44 a share.

Dave McClure (0:21)

ElevenLabs was valued at 11 Billion dollars, now being valued at 22 billion.

Welcome back to another episode of Trading Places, the world's horrible, terrible, worst secondary BC podcast on the planet. Aman, hockey season has started. I'm waiting for the NBA season to get started. What's happened in any world? Everything's great, except for wars around the world and oil prices and oil shocks and rising rates and all kinds of other stuff.

Aman Verjee (1:10)

Yeah, well, we got rising rates, we got oil prices bouncing off of 100 bucks, but we've also got baseball playoffs, so that's great. We've got hockey, there's all kinds of stuff you can watch on TV. So if you're into any of that, that's the best month of the year.

I've been reading.

Dave McClure (1:28)

Your book is rising up the charts faster than the price of oil.

Aman Verjee (1:32)

I know, well, we hit number one on the Amazon best seller list for new releases in the economics category. So when you're not watching baseball, football, or watching ice hockey, or seem to be NBA, you can get this book on Amazon right now in the Kindle store. Well, we actually have a promotion going on. It'll be just this week for our subscribers if you clicked on the link in the Kindle store they will provide. So that's kind of good. You know, the only downside now is there's only one place you can go from number one, and that's down. So we'll enjoy the moment at the top while we have it, Phil.

Dave McClure (2:08)

Our headlines this week, we're going to talk a little bit about the macro picture.

Oil shock, bond market, and rising rates. We'll cover the Anthropic S1, which was just leaked recently, a little bit about their revenue and losses and the huge amount of money they're spending on compute. Overall, AI data centers, lots of money being spent, and lots of money being spent in debt, and some of that being spent off balance sheet. We'll cover some AI safety concerns that are come up. Not just a few incidents, but thousands of incidents at OpenAI and other labs.

That's resulted in the IPO window maybe looking a little bit shaky. Oura pulled their IPO. Anthropic had delayed their IPO at least a month, and OpenAI delayed their IPO until 2027 Some good news, AMD bought World Labs for $8 billion just in two and a half years. That company went from zero to an $8 billion exit. ElevenLabs doubled their previous $11 billion valuation to $22 billion, and they did an employee tender. And then lastly, we'll cover Aalo Atomics in our Valuation Corner along with other nuclear AI startups. Aalo is actually a company we're invested in, Aman.

Aman Verjee (3:11)

Yeah, we are. That seems like a really great deal. We'll talk about them and we'll just do a brief of the nuclear category.

Dave McClure (3:19)

Well, our first article is going to be talking about the market, macro picture, and I guess some rising rates for the 10-year treasury, now above 5% for the first time in close to 20 years. Maybe not just an issue in the US market, it's actually also a potential issue in the global market. Other countries also have rising rates for bonds. Some might say that's coming from the government debt, some might say it's coming from all the oil shocks going on, some elder might say it's coming from all the AI data center build-out.

Aman Verjee (3:50)

This is a chart showing the 10-year sovereign benchmark yield in a number of countries. You've got the US on the list that's right near the top, but you've also got the UK, the purple line is the Euro yield, and you can see what's been happening over the last four years or so, a pretty steady march up into the right. There's at least three different things that could be driving it, and you mentioned a couple of them. One is just budget deficits overall, which is the supply of sovereign debt, US and others, that's just pushing bond yields higher to supply demand mismatch.

It could be just the trade deficit in the US, more of a US-specific problem that's been creating a contagion to other markets around the world, it could be dollar weakness, or it could be other global factors. If this is primarily a US thing, you would expect the market to be behaving in ways that are different than now. So let's just go through the possible sources and causes. And I'll give you maybe four different causes, and we can talk about what types of economists are stressing those different causes. One of them is just higher inflation. If you have higher inflation coming from oil prices or supply chain bottlenecks, it produces higher interest rates.