Meta's Muse Agent Hits #1, Anthropic Eyes a $2T IPO, a Fed Hike & Shield AI at $20B | Trading Places Podcast Ep49 ft. Dan Gray (Odin)

Dave McClure (0:00)

Google did not want to be late to the party too much, disclosing that they did some AI hacks to three companies as well. Trying to keep up with the bad boys of Anthropic and OpenAI. Legible for capital is a term that's being used all across Venture. Could you explain what you think that means to me?

Dan Gray (0:15)

I think it means obvious to idiots. Is the brutal truth is what that means.

Dave McClure (0:21)

It certainly seems like the corporate tender market is growing in just three years. We've seen probably a tripling of the number of deals and probably 5X in the dollars. So now we're like 10 to 1 the number of 100 million dollar private rounds versus 100 million dollar IPOs.

Aman Verjee (0:36)

So far the revenue has only been about 300 million dollars. They're targeting 540 million dollars this year. They're guiding to about 80% year-over-year growth in revenue.

Dave McClure (1:06)

Aman, we are back.

The world's second worst VC podcast on secondary trading places. Not only are we back, but NFL football is back. Did you get your fantasy football team lined up? How did you do the first week?

Aman Verjee (1:21)

Did. I did great. I'm actually the defending champion in my league. I've had a couple of close seasons and runners ups, but I somehow won last year with a suboptimal team. But winning is winning. For a football fan, it's the first time to the Jets and the Giants.

Dave McClure (1:34)

We're in Silicon Valley, Aman. What are you talking about? This is all about the Niners. They crushed the Rams down in Australia, in Melbourne.

Aman Verjee (1:43)

Maybe instead of all the games in Australia from now on.

Dave McClure (1:45)

Well, let's walk through our headlines for this week. We've got the Fed hiking rates. We got Anthropic pushing their IPO to November, but it sounds like they're still going to go out. On the other hand, OpenAI has pushed the news of their IPO till 2027, but they are considering another pre-IPO raise at 1.2 trillion. AI data center provider Nscale is filing an IPO that should be in the 30-35 billion range. I guess along with the UK, Europe is rising. Mistral AI raised at 24 billion.

Our portfolio company Cohere merged with Aleph Alpha that was definitively signed. Google didn't want to be left out in the cold on jailbreak and I guess they announced that Gemini hacked into three companies trying to keep up with the bad boys of Anthropic and OpenAI. Meta AI agent Muse is now the number one app in the App Store, and they're competing with Instinct, which is in talks to raise it at $10 billion valuation.

And then lastly, we'll be covering Shield AI in the evaluation corner. Shield AI rumored to be raising at a $20 billion valuation. Let's get started here, and what happened at the Fed this past week?

Aman Verjee (2:51)

So we had a Fed meeting under the new chairman, Kevin Warsh. This is the second meeting with Mr. Warsh in charge. The tone was very different than his tone the first time. The first time was like the wait and see.

The vote at the time was something like 9 to 3 to hold rates where they were. They were seeing some hints of inflation, but they were seeing, I guess, a general direction towards inflation subsiding in the second half of the year and tight labor markets, but some temporary things driving prices higher. I think Warsh was just in his first meeting and trying to lay the land, trying to figure out where the bathroom is at the Fed. This time was a much different tone. It was a unanimous decision, so he's obviously done a good job now of getting all the different Fed governors to see the world the same way. They agreed on a 25 basis point rate hike. Markets expect, they're kind of 50-50. I don't know whether they get another rate hike in October. That would be another 25 basis points. Right now, betting markets have it at about 53-47 for a rate hike.

I don't think they're going to go in October. There's an election happening in November. You might have heard about. I don't think the Fed wants to slide into a political discussion.

Dave McClure (4:00)

What happened to all these Trump appointments and Trump wanting rates to go down? I guess a unanimous rate hike doesn't seem like people are playing ball with President Trump, huh?

Aman Verjee (4:10)

I know. Do you think Elizabeth Warren has sent in her letter of apology yet to Warsh for calling him Trump lacky?