Killing Fields circa 2024, Eric Schmidt's AI bet, Perplexity.AI on a roll, Seinfeld's comedic concerns, designer strawberries and mushrooms, and the UnPatriotic GenZ...
Given our economic and innovation leadership positions, the US has little choice but to adhere to an updated version of the 'peace through strength' policies pioneered by Ronald Reagan that led to the non-violent collapse of the Soviet Union in 1989. The world still needs to point to a 'shining city upon a hill' described by Reagan in his farewell address as 'a tall, proud city built on rocks stronger than oceans, wind-swept, God-blessed, and teeming with people of all kinds living in harmony and peace.' But where do AI-powered killing machines fit into the equation? For that matter, where does modern conventional warfare fit in?
Autonomous drones are being used for surveillance, targeting, and attacking ground forces across the Gaza and Ukraine battlefields. Ukrainian drone company Saker produces the Saker Scout that can make its own decisions about who to target and destroy. Lavender, an AI-powered database developed by the Israeli Defense intelligence, rapidly identifies potential Hamas and Palestinian Islamic Jihad (PIJ) targets and has marked 37,000 operatives, many of whom are targeted for assassination.
Harkening back to Robert Oppenheimer's invention of the atomic bomb in 1945, a scientific feat he later profoundly regretted, some global leaders are wondering if killer AI robots represent 'the Oppenheimer moment of our generation.'
So, how do we help protect the world without killing people? These are very complicated issues that will not be settled in this post. Our view is the first step to answering this question is to embrace and atone for the 3.5 million, overwhelming innocent people that were either killed, maimed, or displaced during the Bush and Obama administration's $3 trillion foray into endless Middle East wars. If examined thoughtfully, we believe that it will more than prove that modern, conventional war is no longer just. The level of killing and ‘collateral damage’ that occurs no longer can justify the means.
It might be time to revisit a modern form of the ‘Reagan Doctrine'—a multifaceted non-violent offensive against totalitarian leaders and dictators oppressing people around the world. This doctrine included covert support and encouragement for those seeking freedom (think the Solidarity worker movement in Poland in the 1980s), guarding access to the West's most advanced technologies, and rallying the free world to isolate and punish dictatorial regimes. This 'Reagan Doctrine' forced the Soviets to spend heavily to counter these measures, which was unsustainable for a controlled economy already teetering and led to the peaceful collapse of the communist regime.
Encouraging the development of more killer robots can only lead to more killing. As the center of innovation, Silicon Valley entrepreneurs and investors have to ask themselves if our economic incentives are aligned with the preservation or destruction of the rest of humanity. Silicon Valley has a lot of power in this equation, and we should have only one goal—To stop the killing.
Did you know?
(Overheard on the streets of the global Silicon Valley. Got any hot insider tips? Email us editor@cryptoniteventures.com)
Billionaire Boys Club
Elon and Zuck didn’t make the 22-member cut for the Feds’ AI safety board to help stay on top of potential 'AI-related disruptions in our nation’s critical services.’ Homeland Security Secretary Alejandro Mayorkas, who the US House of Representatives has impeached for 'breach of the public trust' in his handling border security, announced the new board last week. It includes OpenAI's CEO Sam Altman, Microsoft CEO Satya Nadella, Google CEO Sundar Pichai, Nvidia CEO Jensen Huang, and the CEOs of Adobe, Advanced Micro Devices, Delta Air Lines, IBM, Northrop Grumman, Occidental Petroleum, and the head of Amazon’s AWS division.
While corporate titans dominate the board, it also includes civil rights advocates, AI scientist Fei-Fei Li, who leads Stanford University’s AI institute, Maryland Gov. Wes Moore, and Seattle Mayor Bruce Harrel.
VC Whispers
Now that Bitcoin has rallied, fueled, in part, by Wall Street's Bitcoin ETF fever, crypto-savvy VCs are back in the market raising crypto funds. Pantera Capital is targeting $1.25B for a fund that will invest in early-stage tokens, liquid tokens, and startup equity. Paradigm is in discussions to raise up to $850M in a new fund. According to Pitchbook, in the first three months of 2024, VCs have closed $2B in crypto funds globally, compared to just $1.9B in all of 2023.
Agtech VC deal counts have mirrored the broader global VC slowdown. According to Pitchbook, agtech startups raised $1.2B across 161 deals, down 25.8% and 20.3%, respectively. The median pre-money valuation totaled $13.7 million, down 8.6% from 2023. Market volatility, high interest rates, and a closed IPO window have frozen VCs in their boots and have created a private company market valuation correction.
AI Tracker
Two-year-old Google search slayer and our edit team's favorite AI chatbot tool, Perplexity.AI, raised $63M in new funding at 2X the value of their last round three months ago. Perplexity’s US user queries in the US are also doubling—so far this year, they have reached 75 million, which is already more than in all of 2023. Perplexity has cut deals with two major carriers, SoftBank and Deutsche Telekom, allowing them to market the service to an additional 300 million users worldwide.
Perplexity is now worth North of a cool billion. Daniel Gross, billionaire Stanley Druckenmiller, Y Combinator CEO Garry Tan, and Figma CEO Dylan Field all invested in the current round. Perplexity's early backers include Jeff Bezos and Nvidia, who both made follow-on investments in the new round. Nvidia CEO Jensen Huang has said he uses the product 'almost every day.'
Meanwhile, Paris-based Mistral AI is seeking several hundred million dollars at a $3B-plus valuation. The startup's existing investors include Andreessen Horowitz, Lightspeed, and Microsoft, which invested $16M in Mistral as part of a partnership with their web service arm Azure in February. In December, Mistral raised $415 million at a $2.2B+ valuation, a significant increase from the $280M valuation following its $113M seed round in June 2023.
As a software and hardware developer, Apple has a GenAI advantage over its competitors because the new iOS 18 AI features will run entirely on-device so that users can use them offline. To achieve this, Apple is developing its own large language model (LLM) and leveraging the Neural Processing Unit (NPU) of Apple Silicon in the new iPhone 16. Apple is also filling any knowledge gaps through deals with Google, Microsoft-backed OpenAI, and China's Baidu.
Apple has the further advantage of being able to integrate GenAI features across all its established apps, including Siri and iMessage, Apple Music, Pages, Keynote, and Numbers. To achieve its AI goals, Apple has reportedly hired away dozens of artificial intelligence experts from Google. Most of Apple's AI team is based in Cupertino and Seattle, but the company has been expanding its AI base in Zurich, Switzerland.
Apple will unveil the new iOS 18, iPadOS, macOS, and other platforms at its annual Worldwide Developers Conference (WWDC) at Apple Park in Cupertino from June 10 through June 14.
AI-supercharged coding is now officially in fashion. 44% of software engineers say they use AI tools as part of their development processes. Gartner estimates that over half of organizations are currently piloting or have already deployed AI-driven coding assistants and that 75% of developers will use coding assistants in some form by 2028.
AI upstart Augment, cofounded by ex-Microsoft developer Igor Ostrovsky and Guy Gur-Ari, a former AI research scientist at Google, is set to ride this trend by shaking up the still-nascent market for generative AI coding technologies. How exactly? They are keeping that on the down low for now.
What we do know is Augment raised $252M, a post-money valuation just shy of $1B, and the investors include former Google CEO Eric Schmidt, Index Ventures, Sutter Hill Ventures, Lightspeed Venture Partners, Innovation Endeavors, and Meritech Capital.
OnHollywood
Comedian Jerry Seinfeld created and starred in the iconic sitcom Seinfeld, which ran for nine seasons from 1989 to 1998 and is considered one of the greatest TV shows of all time. So, if Jerry has observations on why Hollywood and TV programming are declining steeply, the studio honchos should have a listen.
"People always need comedy. It used to be that you could happily go home at the end of the day and watch shows like Cheers, MASH, Mary Tyler Moore, and All in the Family. You just expected there would be some funny stuff to watch on TV every night. Well, guess what? Where is it? This lack of funny programming is the result of the extreme left and PC (politically correct) crap. People are running around worrying too much about offending people. When you write a script, it goes into four or five different hands and committees, all saying, 'Here's our thoughts about this joke.' Well, that's the end of your comedy. These folks move the gates, like in skiing, and the gates keep moving. Your job as a comedic actor now is to be agile and clever enough, so wherever they put the gates, you're gonna make it through the gate."
—Jerry Seinfeld speaking on The New Yorker Radio Hour
Canadian mega hip hop star Drake posted (and since removed) on his X and Instagram accounts a diss track called Taylor Made Freestyle aimed at fellow rapper Kendrick Lamar, which included AI-generated voices of the late Tupac Shakur's voice and mimicked Snoop Dogg. Check out the track above; it sounds like Pac and the Snoop to us—a total trip. Drake took it down after lawyers for the late rapper's estate threatened to sue. Tupac's lawyer, Mr. HowardKing, pointed out that Drake had previously objected to his voice being cloned in the viral AO cover track Heart on My Sleeve, which also copied the voices of the Canadian singer and The Weeknd.
The Science of Life
For the first time in Gallup polling since 2001, a majority of US adults, 57%, say they would feel better if they got more sleep, while 42% say they get as much sleep as they need, a reversal since last measured in 2013 when 56% of Americans got the sleep they needed, and 43% did not. Fewer women than men get the sleep they need, with 27% of younger women saying they are getting much less than required.
"Many signs commonly attributed to aging are often symptoms of insufficient or poor sleep. We must pay attention to sleep challenges and make conscious efforts to set the stage for restfulness both in terms of nighttime routines and daytime habits. These habits include exposing oneself to morning sunlight to align with natural circadian rhythms, practicing morning meditation, and engaging in cardio exercise during the day to facilitate nighttime sleep. Adequate REM and deep sleep are emphasized for recovery and brain-cleansing processes, and it's suggested that most people need seven to nine hours of sleep each night. We advise against sleep disruptors like caffeine intake late in the day, alcohol consumption, exposure to light during sleep, an overheated bedroom, and late-night eating."
Going Green
Vertical farming company Oishii grows specialty strawberries ($12 for six) for high-end consumers, world-class restaurants, and specialty retailers, particularly in the New York City area. The company's 'Omakase Berry' and the newly launched 'Koyo Berry' are grown year-round in the company's vertical farms without the use of pesticides. Oishii recently bucked the funding slow-down in agtech by closing a whopping $144M Series B financing led by Nippon Telegraph and Telephone, giving the company a $400M pre-money valuation.
Speaking of expensive designer strawberries, our favorite $20 smoothie at Erewhon Market in LA is the Hailey Bieber Strawberry Glaze Skin. While in the trendy store, you might as well pick up some beef dandelion echinacea bone broth for $14 a jar and $20 Cult Coconut vegan yogurt. Strolling the aisles, you also might bump into everyone equally trendy, from Gwyneth Paltrow to Emma Chamberlain to the Kardashian-Jenner family. The high-end natural foods grocery market in the US is estimated to be worth over $100 billion, with Whole Foods and Sprouts Farmers Market as the top chains.
The grocer received an outside injection of capital from Stripes Group in 2019 and has seven SoCal locations, including Pasadena. It's all paying off. In 2019, Forbes reported that Erewhon generated $2,500 in sales per square foot of floor space—over four times more than the average grocery store.
‘Our cult following among young consumers is a pure reflection of the increasing interest in bettering our health. We are constantly monitoring CPG trends through various channels as we strive to be first to market with the highest-quality products.’
Follow the Crypto
FTX founder Sam Bankman-Fried was sentenced to 25 years in prison for a massive fraud that unraveled FTX, the third biggest cryptocurrency exchange, before it blew up in mid-air in late 2021. Changpeng Zhao (a.k.a. CZ), the co-founder and former CEO of Binance, the world's largest crypto exchange, got off a little lighter with a sentence by a Seattle judge last week of only four months in federal prison. It helped that CZ pled guilty last November to violating anti-money laundering laws, the company agreed to pay a $4.3B penalty, and Binance remains a thriving business.
Know Thy Enemy
Power and wealth can lead a man down a deep, dark path. As a case in point, one need not look any further than North Korea’s Kim Jong Un, one of the world's most repressive leaders and grisly executioners. According to defectors from the totalitarian state, despite having a long-suffering wife, Kim has his cronies pluck 'tall, beautiful, and virgins' from classrooms and be turned over to a life of sexual servitude in Kim’s ‘Pleasure Squaud’ of entertainers, maids, and concubines. Kim also owns a disturbing 'Pleasure Train' packed with stunning 'lady conductors.'
The 'less stunning members' are ordered to serve lower-ranking generals and politicians. In 2020, The Sun reported that the dictator's pleasure squad was a 2,000-strong harem of sex slaves who were forced not only to 'sing and dance for the nation's elite but also take part in sexual games and orgies’ Some members are said to be as young as 13 when they were first taken out of school and forced into sex work. If the treatment of the Uyghurs informs us about the nature of the Chinese Communist Party, the systemic sexual abuse, exploitation, and oppression of women and girls by the Norious Tub Kim Jong Un should do the same. It’s ugly.
Gen Z
Gen Z has spent its formative years defined by political polarization, economic uncertainty, COVID-19, and the Black Lives Matter protests and riots during the Summer of 2020. This trauma and uncertainty has left Gen Z with less love, identification, and loyalty to their country than millennials, Gen Xers, and Boomers. Gen Z also does not possess any shared consciousness about what it means to be an American. A Spring 2024 Harvard Youth Poll found that while 74% of 18-29-year-old Republicans would ‘rather live in America than any other place, only 55 percent of same-age Democrats feel the same.
Studies have long shown that those who identify as Democrats are significantly less likely than Republicans on the importance of feeling pride in being an American. For example, a 2022 study found a 36-point gap between Democrats and Republicans over 65 on the question of how important 'being American' is to their identity. Yet, within Gen Z, that same gap is 55 points, with only 18 percent citing any identification that 'being American.'
Meanwhile, the use of alcohol and e-cigarettes among 11 to 15-year-olds living in Europe, Central Asia, and Canada has reached 'alarming' levels based on survey data from 280,000 young people by the World Health Organization (WHO). While 8% of 11-year-old boys have consumed alcohol in the last 30 days, it is higher than the 5% of girls who have, but by age 15, 38% of girls are drinking compared to only 36 percent of boys. The rate of regular drunkenness has also gone up, with nine percent of teenagers reporting having experienced 'significant drunkenness.'
'Our findings highlight how available and normalized alcohol and e-cigarettes are. The widespread substance abuse among children in many countries across the European Region—and beyond—is a serious public health threat; such as the fact that high-risk behaviors are linked to risks of long-term addiction. The consequences are costly for them and society.” — Hans Kluge, WHO Regional Director for Europe
While smoking is on the decline, e-cigarette use—often called vaping—is up among teenagers. Around 32% of 15-year-olds have used an e-cigarette, and 20% reported having used one in the last 30 days. Cannabis use, meanwhile, was down slightly, with 12% of 15-year-olds having ever used it, down 4 points in as many years.
What the Math Says
There are now over 3 million soft and hard-core peddlers on London-based OnlyFans, with 67 percent of the sex site's $2B+ annual net revenue coming from US content creators. OnlyFans' net revenue was $375M in 2020 and rocketed to $2.5B by 2022. OnlyFans charges content creators a 20% commission on all revenue they generate, with the average OnlyFans creator earning $180 a month. OnlyFans has paid creators over $5B since its inception in 2016.
Now, a new survey found that, per 100K, Connecticut has the highest number of creators, followed closely by Nevada, Hawaii, and North Dakota. The survey also reported the average monthly income of OF creators in each state. South Dakota generated the highest average monthly income, at $1,460 per month, with West Virginia last at $40 per month. The study was conducted by sex toy and wellness company Bedbible using a search engine called OnlySearch, which can search for OnlyFans creators by using keywords, including state.
‘A lot of folks are struggling now more financially than in past years, so I think people are getting creative in way in supplementing income. Ultimately, when it comes down to sexual attitudes, we are all more alike than different.’
—Professor Stacey Litam, Assistant Professor, Cleveland State University, and coauthor of Archives of Sexual Behavior—The sexual attitudes and characteristics of OnlyFans users.
A new American Press Institute/AP ominously says that about 53% of Americans say they are extremely or very concerned that news organizations will report inaccuracies or misinformation during the 2024 election. A whopping 42% worry that news outlets will use GenAI to create stories. The study also shows that half of US adults follow presidential election news closely, with a two-thirds engagement for those over 60, compared with only one-third of those under the age of 30.
Pura Vida (pure life)
Certain foods and spices can strengthen your immunity and create a path to resist popping antibiotics and contributing to antibiotic-resistant superbugs.
These foods have natural antibiotic properties. They help strengthen immunity by balancing the good and bad bacteria in your gut (where 70% of your immune system is) and give you a better shot at fighting off the next superbug.
Fermented Foods make you more resilient and better able to repel viral and bacterial pathogens by balancing gut bacteria and stomach acids, releasing enzymes to ease and improve digestion, and allowing your body to extract and absorb more nutrients from the foods you eat.
Stalks and Stems—tough parts of your veggies we usually throw away—give your good bacteria indigestible plant fibers to feast on and, therefore, serve as prebiotics. Think of these prebiotics as the fertilizer that enables your gut garden to thrive and can help tame stress and anxiety levels.
Medicinal mushrooms have been used traditionally for thousands of years to promote well-being and longevity. But they also help to strengthen the immune system, lower inflammation, prevent disease, and give you more energy.
Turmeric contains curcumin, which has powerful anti-inflammatory, antiviral, antibacterial, and anti-tumor properties and effects. You can sprinkle it on salads and eggs and mix it into soups, smoothies, and hot and cold beverages.
Fresh Ginger has an antibiotic effect on food-borne pathogens. Eating fresh ginger before meals can offer an extra layer of protection from food-borne illnesses like salmonella and listeria. That can be a lifesaver, particularly when traveling and eating questionable or unusual foods or dealing with indigestion.
Raw Garlic is a powerful, pungent, and delicious medicinal food with known antiviral, antifungal, and antibiotic properties that have helped mankind fend off flu and cold viruses for thousands of years. Chop, crush, or slice a few cloves and let them sit out for 10 to 15 minutes to aid the release of additional health-boosting chemical compounds.
Extra-virgin Coconut Oil, unprocessed, is a tasty antimicrobial and antifungal food. It contains the all-powerful lauric acid, which helps smack down certain types of viruses and pathogenic bacteria. Try adding EVCO to smoothies for its antimicrobial effects and delicious tropical flavor.
Good morning and thank you for this edition in particular! This entire concept of relegating final decision-making to ANY AI-based system is utterly abhorrent to me. I was a tactical operations officer in the US Air Force, in a system where – to put it mildly – those heading ops on any given day would be the first to know we were all going to die. It was our responsibility to inform our superiors that if they were going to wake the president, it better be right. I was the ops officer on duty one night when the computer for the entire missile warning system “broke”. It was human awareness and intervention that precluded any further damage. Yes, our hardware and software have become substantially more sophisticated and robust over the years, but not to the point where we cede authority and ultimate control. And before anyone labels me a luddite, I've been originating and leading technology investment in raw startups for nearly 40 years.
Keep up the great work!
Wayne Embree