Happy Tuesday. Little bit of a hiatus — a lot happening with the companies I'm running. Sometimes content takes a back seat. But today, that's not the case. This might be the biggest single news day in a while. The news cycle is insane right now in tech, especially as it pertains to first, second, and third order effects for founders. Let's get into it. Anthropic Sued the Pentagon — And Their Competitors Are Standing Behind Them The Anthropic-Pentagon story just escalated to a new level. Anthropic filed two federal lawsuits yesterday — one in Northern California, one in DC — alleging the supply-chain risk designation violates their First Amendment rights and exceeds the scope of law. They’re seeking a temporary restraining order to keep working with military partners while this plays out. The massive development: 30+ OpenAI and Google DeepMind employees filed an amicus brief supporting Anthropic. Among the signatories — Jeff Dean, Google’s chief scientist and the leader of the Gemini AI program. The brief is blunt: the government’s designation was “an improper and arbitrary use of power that has serious ramifications for our industry.” The Pentagon could have simply cancelled the contract and hired another AI company. Instead, they weaponized a national security label to punish a private company. Even Sam Altman, who literally took the $200 million Pentagon deal that Anthropic lost, called this “very bad for our industry.” Here’s the thing I want to say to founders. This actually affects early-stage startups. Your political ties, your political positions are really, really important in how your product is commercially used. I work in an industry where things are regulated. We have a large government agency — the SBA — that oversees how our commercial partners provide services. It’s better to be on the side of the political institution because that gives you the benefit of the doubt when you bring services to market. Church and state are very integrated in business right now. Your political affiliation, your religious affiliation — all of it is part of how you’re judged as a builder. That’s just reality. I grew up on the principle that church and state are things you stay away from in business. That’s over. Anthropic has been the lone soldier among the big companies that hasn’t bowed down to Trump. Everyone else went MAGA in the past 18 months. Dario has been outspoken — he’s not from that ilk. He’s not giving money, not showing up at events. And now there are real ramifications. The supply-chain risk designation is going to cause a trickle-down effect. It’s going to slow the business in the short term. And here’s the part nobody wants to say: competitors will support Anthropic in court while taking the opportunity in the market. OpenAI already took the $200 million contract. Google will probably lean into whatever the military needs. The industry is standing behind Anthropic because this shouldn’t be happening, but the reality is that business moves on. Anthropic isn’t going anywhere. But this will probably go into litigation for a while. Oracle Reports Tonight — And the Pressure Is Real Oracle’s reporting after the bell today, and their AI cloud numbers will tell us a lot about whether this infrastructure buildout is real or hype. I’ve been reading a book on Dario Amodei, and the biggest thing to understand about the AI story is that these companies are built around access to compute. The more data centers, the more compute, the more power — the better. That’s how it works. That’s the reality of why these companies are building out massive infrastructure. But Larry Ellison is under pressure. Oracle has more than $100 billion in debt and massive layoffs as they push ahead with this transformation. Expected numbers: $16.9 billion in revenue, cloud up 43% to $8.9 billion. That cloud number represents a historic shift. Oracle used to be an on-prem database company. Now cloud is more than half the business. There’s a learning lesson here for every startup: you have to always be reinventing yourself, especially in the AI-first market. What you were a year ago may not be what you are today. The capex numbers are staggering: $50 billion expected this year. Q3 alone, $14 billion, up 139%. And their Stargate initiative with OpenAI appears to be scaling back. The Information has reporting on why OpenAI walked away from the Stargate expansion in Albany. Oracle’s stock tells the story of the market’s uncertainty. Down 54% over six months. Flat over the past year. Up 125% over five years. The AI bet is massive, but the market is nervous about whether $300 billion in commitments upfront is justified for something we don’t know the full scale of yet. Mira Murati Hit Back — A Gigawatt of Nvidia and a Comeback Story Mira Murati is back in the news. And this time, it’s a good story. The background: she’s 37, ex-CTO at OpenAI, previously at Tesla. She founded Thinking Machines Lab, raised $2 billion out the gate at a $12 billion valuation — notoriously, without a product. Then January happened. A wave of defections. CTO Barret Zoph left. People went back to OpenAI. She was in a tough spot. But here’s what I keep saying about startups — they’re long-term but also super short-term. You can go from a bad position two months ago to a pretty good position today. It looks like she’s weathered the storm. Today, Jensen Huang himself announced that Nvidia is making a significant investment in Thinking Machines Lab and supplying Vera Rubin AI accelerators. The commitment: at least one gigawatt of compute. Only the biggest labs operate at that scale. I want to say something real about this. She’s 37, I’m 38. I’m building a company, she’s building a company. It’s the game. Is it harder for me to raise money than Mira Murati? I’m sure it is. But at the end of the day, this is the game everybody has to play if you’re in the venture-backed world. The part that a lot of people aren’t ready for: down rounds, not paying yourself, seeing a new company raise more money than you every single day. The business of being in venture is as much about fundraising as it is about building a business. And if you can’t do it, if you don’t like to do it — you’ve got to get good at it. It’s a skill. If you ain’t got the money in the bank to build what you want, you ain’t got a chance. Go out there and get the bag. She doesn’t have to do Thinking Machines Lab. She could go make $10-30 million a year at another lab. She’s out there running a company. You respect it. Jensen put his neck out for her. To whom much is given, much is expected. She got her first hit and now she’s hitting back. Roy Lee: Building the Real Resume Quick reaction to Roy Lee. TechCrunch did a whole piece on him and it sparked a lot of debate. Here’s what I think. See Roy’s Response to Techcrunch below. I believe what Roy Lee is doing is the modern-day way to be a founder. You’ve got to get news, you’ve got to get attention, and he’s doing it in a very direct, punctual, public way. A lot of people can say a lot of things about him, but as a 38-year-old — I wasn’t doing what he’s doing at 25. I don’t think a lot of founders were thinking like that at 25. The real insight is this: he’s building a brand. And one thing that’s true today more than ever — if you’re a founder, you’re building a brand around yourself. One of my friends told me: if your companies fail, you still have to exist. You’re not defined by your company. I’m Matt Parker. I am who I am. I haven’t had a nine-to-five in over 12 years. This is a brand. For someone like Roy Lee, his public profile is the real resume. There’s always going to be young talent coming through the pipeline. And he’s building an attraction magnet. When stuff goes viral, it’s huge for him. As for the revenue numbers controversy — I don’t count people’s pockets. If you’re a private company, you don’t have to report revenue. And a lot of these AI revenue numbers right now? A lot of it’s b******t. “We made X amount yesterday so now we’re doing this annually.” A lot of people are hyping it. Shout out to Roy. Different approach. We’ll see what happens. NBA & Morality — New Essay I published a separate piece today about the NBA, morality, and the Magic City / Atlanta Hawks story. It’s on my NBA Substack — linked in the show notes. Go check it out. The Through Line Five stories, one thread: everything is political now. Your position on government, on safety, on brand, on how publicly you build — it all affects your business. Anthropic is being punished for having principles. Oracle is betting $50 billion on a reinvention. Mira Murati weathered a storm and hit back. Roy Lee is building a public brand because that’s the real resume. And even the NBA is navigating morality in public life. Church and state are integrated in business. That’s the world we’re in. Build accordingly. Reply PREMIUM for the weekly deep dive. This show is presented by ModernTax — AI and voice intelligence for IRS and tax services. We serve SBA lenders, CDCs, banks, and fintechs. 98% accuracy. 75% cost reduction. moderntax.io Get full access to Four Insights at stretchfour.substack.com/subscribe
