TheChek News Flow

Spring is finally here along with longer days.

The changing weather may have caused you to miss some eye-catching rounds, so let’s run down a handful that you may have missed as our clocks sprung forward.

Only about 20% of residential recyclables are actually recycled, so clearly recyclers need a way to better find, sort and separate than what they have now.

San Francisco-based Glacier is looking to help with that. The AI and robotics startup is developing robots that automate recyclable sorting while at the same time collect real-time recycling data for companies.

Glacier locked up a $7.7 million round this month — led by big-name firms/funds NEA and Amazon‘s Climate Pledge Fund. In fact, the company now has a partnership with the retail giant to help the “traceability and recovery processes for recyclable materials” at Amazon. The partnership will try to identify and aggregate novel biomaterials so they can be recycled.

The startup’s robots utilize AI capabilities to identify more than 30 different materials — including everything from plastic bottles and aluminum cans to more difficult-to-label items like toothpaste tubes and cat food cans.

We are all trying to recycle as much as we can, but perhaps an AI-enhanced robot can help where we fall short.

While expecting mothers often watch what they eat, it also can be important pre- and post-pregnancy too.

Detroit-based Chiyo is a fertility through postpartum maternal nutrition startup. The company attracted some investor interest this month with a $3 million round, led by Bread and Butter Ventures, Ingeborg Investments, Union Heritage Capital, Peterson Ventures, Detroit Venture Partners, Palette Ventures and Helm.

The startup is looking to rewrite “what nutritional care looks like during each stage of a woman’s reproductive life cycle.” Its meals are rooted in Eastern food therapy. It has served 100,000 meals since launching in 2021 and grew 300% in the past year while expanding nationwide.

The company also now works with more than 100 women’s health practitioners. With the new cash, the firm is looking to build its digital platform for personalized customer self-guided content and nutrition programs and increase distribution through clinics and its practitioner community.

One stat the startup likes to point to is a 50%-plus decrease in pre-term birth rates across labor-and-delivery hospital units that participated in coordinated holistic care programs between 2014 and 2019.

You may have heard AI is a big thing right now. Well, did you know it can help your teeth?

March Capital clearly believes it can. The firm led a $53.2 million Series C at a $550 million valuation for Boston-based Overjet.

The startup uses AI to help interpret X-rays and review dental insurance claims — huge issues that often cause friction between dentists, payers and patients, and can cut into the time allotted for care.

Its platform — the only dental AI platform cleared by the U.S. Food and Drug Administration, per the company — can be used to detect, outline and quantify instances of oral disease — with millimeter-level precision. Its AI is trained on millions of cases and continually verified.

Still likely won’t make anyone want to go to the dentist, but perhaps it will increase the level of attention and care.

Everyone wants to give their best at work. A Cincinnati-based automated coaching firm is trying to help with that.

Cloverleaf raised $7.3 million in a Series A extension led by Advantage Capital. The startup is trying to help companies unlock their team members’ full potential by leveraging psychology data from behavioral assessments — such as DISC and Enneagram — and providing personalized coaching tips to employees directly in their daily collaboration tools such as Slack and Microsoft Teams.

The idea seems to be that while upskilling and training the workforce can be useful, personalized tips for team members based on who they are and how they think can also be useful.

It seems to be catching on, as the company has tripled its revenue since June 2022.

At a time when companies are cutting their workforce, getting the best out of everyone is more important than ever — even if it comes from a Slack channel.

Can I help you?

We started with robots and we’ll end with robots.

It’s no secret restaurants have struggled to secure enough staff post pandemic.

Well, a Redwood City, California-based startup may have a solution — robot waiters! Bear Robotics got a $60 million Series C financing from home appliance giant LG Electronics.

The robots are not exactly human-like — they are more just elevated trays on wheels — but the company may have plans to expand beyond its current Servi robots. In its blog announcing the round, the company says “we’re poised to explore new frontiers, particularly in smart warehousing and supply chain automation. Our next-generation robotics platform, featuring autonomous navigation systems and adaptive learning algorithms, is tailored to meet the intricate demands of modern supply chains and manufacturing processes.”

However, it is the current product that caught our attention.

While you may lose out on the human element with a robot as your waiter, you also won’t deal with a rude server. Perhaps it’s a trade off.

This March certainly did not go out like a lamb, with seven rounds hitting $100 million or more in the final week. While there were no huge rounds like last week, money was again spread around from AI to biotech to marketing and more. Let’s see if April can continue the trend of a growing amount of large raises.

1. Celestial AI, $175M, semiconductors: Optical interconnectivity startup Celestial AI raised a massive $175 million Series C led by Thomas Tull’s US Innovative Technology Fund. With the explosion of generative AI, both compute power availability and memory capacity are becoming more and more crunched — and marriage between compute and memory causes both to increase simultaneously. However, Celestial’s photonic fabric platform helps separate compute and memory, making processing extensive AI faster and more energy-efficient computing. It was just last June when Santa Clara, California-based Celestial raised its $100 million Series B funding led by IAG Capital Partners, Koch Disruptive Technologies and Temasek’s Xora Innovation fund. Founded in 2020, the company has raised nearly $339 million, per Crunchbase. It’s been a busy couple of weeks in the semiconductor industry as investors have flocked to the sector knowing its importance in the rocketing AI industry. Earlier in March, shares of Astera Labs — a developer of data center connectivity technology with use cases in generative AI — soared after its initial public offering on the Nasdaq. Shares have since then remained well above their IPO price.

2. Avenzo Therapeutics, $150M, biotech: Oncology startup Avenzo Therapeutics locked up the biggest biotech raise of the week, closing a $150 million Series A-1 financing led by Deep Track Capital, New Enterprise Associates, Sands Capital Ventures and Sofinnova Investments. The San Diego-based firm has now raised $347 million since the company’s founding in August 2022, per the company. The startup plans to use the new proceeds to advance its emerging oncology pipeline, which includes a treatment for metastatic breast cancer and other advanced solid tumors.

3. (tied) The Brandtech Group, $115M, marketing: It seems like every week there is a big funding round involving the intersection of AI and some new sector. This week it’s marketing, as New York-based The Brandtech Group, an AI marketing company, has secured a $115 million Series C funding. No lead investor was named, but it was reported the money came from new investors — Fimalac Group and Nendo Labs — and existing investors Mousse Partners and Bansk Group. The company uses machine-generated content and AI to push marketing initiatives. Founded in 2015, the company has raised $725 million, per Crunchbase.

3. (tied) Observe, $115M, data integration: Every company wants to know about the data it has, and observability cloud solution Observe locked up a big round this week to help with that effort. The startup, which helps companies manage data by breaking down silos and making it useful, raised a $115 million Series B at a reported valuation of $400 million to $500 million this week. The round was led by Sutter Hill Ventures. Snowflake Ventures also invested with others. Founded in 2017, the San Mateo, California-based company has raised $277 million, per Crunchbase.

5. (tied) Coro, $100M, cybersecurity: Things have not been great fundingwise in cybersecurity the past year or so as investors have pulled back and IT budgets have been cut. However, some startups are still raising. Case in point, New York-based Coro, a cybersecurity platform purpose-built for small and medium-sized enterprises, announced a $100 million Series D led by One Peak. Founded in 2014, Coro has raised $255 million, per Crunchbase.

5. (tied) FundGuard, $100M, accounting: Artificial intelligence is disrupting most industries, and financial services certainly is no exemption. To that point, New York-based FundGuard, an AI-powered investment accounting platform for asset managers, raised a fresh $100 million round led by Key1 Capital and new investors including Euclidean Capital and funds managed by Hamilton Lane. The company did not disclose a valuation, but it has been reported the round was raised at a valuation of up to $400 million. Founded in 2018, FundGuard has raised more than $150 million, per the company. FundGuard is leveraging AI capabilities to help streamline investment accounting operations and workflows. The startup, which has offices in New York, Boston, London, Toronto and Tel Aviv, plans to use the new cash for ongoing investment in product innovation as well as customer acquisition.

5. (tied) Lightshift Energy, $100M, energy: Arlington, Virginia-based Lightshift Energy, formerly known as Delorean Power, locked up $100 million from Greenbacker Group. Lightshift is a utility-scale energy storage development company and plans to use the cash infusion for its projects across public power, investor-owned utilities and large corporate consumers in the U.S. Founded in 2019, the company has raised more than $121 million, per Crunchbase.

8. (tied) Eliyan, $60M, semiconductor: Santa Clara, California-based Eliyan, a chiplet interconnect developer, raised a $60 million round co-led by Samsung Catalyst Fund and Tiger Global Management. Founded in 2021, this is the company’s first announced round, per Crunchbase.

8. (tied) HeyGen, $60M, artificial intelligence: Los Angeles-based HeyGen, an AI video platform, reportedly raised a $60 million funding round led by Benchmark at a $500 million post-money valuation. Founded in 2020, the company has raised $69 million, per Crunchbase.

10. Pelago, $58M, health care: New York-based Pelago, a substance use management platform, announced a $58 million round led by Atomico. Founded in 2017, Pelago has raised $151 million, per the company.

Boeing’s pain is European rival Airbus’ gain—but that advantage may not last long unless the aircraft maker can ramp up production.

Airbus CEO Guillaume Faury said at a conference in early March that Boeing’s well-documented regulatory, production, and safety problems were bad for the industry as a whole. There’s probably some truth to that. But in reality, the two have been locked in an intense battle for decades, and the U.S. plane maker’s troubles benefit Airbus considerably.

Toulouse, France–based Airbus has secured more orders than Boeing in 2024 and delivered more planes (79 to Boeing’s 54), gaining market share in the narrow-body, or single-aisle, aircraft market—which is essentially a straight shootout between Boeing’s 737 MAX and the European-made A320 family. Airbus holds 61% of the narrow-body market, according to RBC Capital Markets analyst Ken Herbert, though Boeing holds a commanding lead in the wide-body market.

The widening gap is perhaps most starkly illustrated by the two companies’ stock performances. Airbus has climbed 22% to €170.28 euros ($184.33) this year, hitting new highs in the process. Boeing’s stock is down 27%.

The momentum is very much with Airbus, which is favored by more airlines. United Airlines Holdings has been vocal in its desire to get more A321 jets. Japan Airlines ordered A321neo jets for the first time —it was previously an exclusive single-aisle customer for Boeing. That’s a significant win for Airbus, and suggests that efforts by airlines to diversify their manufacturers could help the company grab more market share.

But it isn’t as simple as that. Airbus’ unfilled-order backlog reached 8,599 aircraft at the end of January, an industry record. In other words, at current production rates, there’s more than a decadelong wait for a plane.

“Airbus is winning as much as it can,” Stifel Nicolaus analyst Bert Subin tells Barron’s. “The main problem with Airbus becoming overly dominant is that you just can’t get an aircraft until later into the 2030s, and that’s a problem for airlines that want to grow.” He has a Buy rating on Boeing and a price target implying 42% upside to Tuesday’s price, while his colleague Marc Zeck has a Buy rating on Airbus but his price target suggests a 3% drop.

The downside to this year’s Airbus rally is that shares are now a bit more expensive than their five-year average, trading at 24.2 times future earnings compared with the 21.8 average. That’s still cheaper than Boeing, which trades at 65.7 times projected earnings over the next 12 months.

Airbus, meanwhile, has maintenance difficulties of its own. Hundreds of A320 aircraft are set to be grounded this year due to problems affecting Pratt & Whitney engines. RBC’s Herbert says those issues will have less of an impact than first feared, citing Airbus’ guidance for 800 aircraft deliveries in 2024, which indicates demand remains strong despite the setback.

Airbus wants to reach a monthly production rate of 75 for the A320 family by 2026, up from an average of 48 last year. In contrast, the Federal Aviation Administration has temporarily limited Boeing’s 737 production rate at 38 a month.

Deutsche Bank analyst Christophe Menard has a Buy rating on Airbus stock and sees it reaching €186. However, he wrote in a note that his price target “assumes a flawless production ramp-up,” noting a constrained supply chain as a potential risk. Delivery delays and parts shortages have hit the industry in recent years, particularly since the pandemic.

Boeing has handed Airbus the edge for now, and how far it can extend its supremacy will depend on it getting its own house in order.

Data centers being built to run AI systems require lots of power. Nuclear power is exceptionally well suited to meeting such enormous demands.

Asmall set of companies that own nuclear reactors have seen their stocks soar at Nvidia-like rates in the past few months, part of a little-noticed renaissance in an industry that hasn’t had much to brag about in years. They can thank artificial intelligence.

A small set of companies that own nuclear reactors have seen their stocks soar at Nvidia-like rates in the past few months, part of a little-noticed renaissance in an industry that hasn’t had much to brag about in years. They can thank artificial intelligence.

Nuclear power, it turns out, is exceptionally well suited to meeting the enormous electricity demands of data centers for AI. As a result, the stocks of Constellation Energy Vistra, and Talen Energy are each up more than 90% in the past year. There’s a good chance they’ll go still higher.

“The world clearly is moving in our direction,” said Constellation CEO Joe Dominguez on the company’s latest earnings call.

For years, most of the world was moving in the opposite direction. The fear of nuclear accidents like the 2011 Fukushima disaster is part of the problem. But economics have played a role, too. Operating a nuclear plant has been a terrible business — barely profitable without government subsidies. Generating electricity from nuclear fuel often costs more than generating it from natural gas, because natural-gas prices have fallen during the U.S. shale-drilling revolution. The growth of renewables also complicates life for nuclear power owners. When strong winds gust in Texas, the surge of wind power can cause electricity prices to fall below zero.

Only two new nuclear plants have been built in the U.S. since 2000. The last one, which opened in Georgia in 2023, was seven years late and cost twice as much to build as expected. Nuclear power accounts for 18% of U.S. electricity capacity, and it’s likely to keep drifting lower in the next few years as renewables expand. Globally, it accounted for 9.2% in 2022, the lowest in four decades, according to the World Nuclear Industry Status Report.

The industry’s recent rejuvenation is driven by two factors: political support and technological change.

Global efforts to slow climate change rely on expanding electric power. After more than a decade of relatively flat demand in the U.S., electricity use is set to rise quickly in the coming years as people plug in electric vehicles and appliances like heat pumps. Businesses are also set to ramp up their power demands.

Some of the biggest sources of new power demand are the data centers being built to run AI systems, each of which use as much power in a day as tens of thousands of homes. Data centers, which now account for about 2.5% of power demand, could eat up 7.5% by 2030, according to Boston Consulting Group. The companies that are building the most data centers are big technology firms, including Alphabet, Microsoft and Amazon.com.

Those companies have all made commitments to get their energy from cleaner sources, with Microsoft saying it will remove more carbon emissions from the atmosphere than it produces by 2030.

For companies with those kinds of ambitions, nuclear power fits the bill. Nuclear reactions don’t release carbon in the way that coal and natural gas plants do. And nuclear plants stay on constantly, giving them an advantage over intermittent clean power sources like solar and wind. Battery storage technology attached to solar and wind farms is advancing fast, but it isn’t yet ready to provide enough backup power to renewables to make them as reliable as nuclear power. As renewables take market share from coal and, eventually, natural gas, the percentage of power that can be counted on to run 24/7 will decline.

“You have an outlook where demand is going up, and reliable power going down,” said Rodney Rebello, an analyst focusing on nuclear at Reaves Asset Management. “Nuclear produces reliable power, and it also has the attribute of being clean in terms of its emission profile. The profile of nuclear—24/7, baseload power, clean—lines up really well with data center demand for power, which is around the clock.”

Reaves holds Constellation Energy and Vistra in its closed-end Utility Income fund and in the Virtus Reaves Utilities exchange-traded fund.

It’s important to note that not all nuclear plant owners are profiting from the shift. Independent power companies sell power into competitive markets and profit when prices rise. But utilities that own nuclear plants, like Duke Energy , have struggled, because their returns are limited by regulators. Duke stock is down 1% in the past year. About 60% of the U.S. nuclear fleet is in the hands of regulated utilities, meaning that most nuclear capacity is hamstrung by those rules.

Constellation, the largest owner of independent nuclear power plants in the U.S., has seen its stock jump 150% in the same period. It’s a major turnaround after a rough stretch for the company. Constellation was spun out of Illinois-based utility Exelon in 2022, a year after two of the company’s nuclear plants in Illinois needed a state bailout to stay open.

After the spinoff, Exelon retained its regulated utility and transmission businesses, leaving Constellation with the nuclear assets.

The stocks have since diverged. Exelon is down 9% over the past year, hurt by the larger forces bringing down utility stocks, like high interest rates, as well as company-specific challenges. Last year, Illinois regulators rejected its capital plan, which could have led to rate hikes for consumers and better earnings for the company.

Unlike Exelon and Duke, Constellation doesn’t need to ask regulators to approve rate hikes for its power. Constellation sells the power it produces into competitive electricity markets along the Atlantic coast and in the Midwest, where demand and prices have been rising. The company has also made direct deals with tech companies like Microsoft that are willing to spend extra to certify that the power they use for their data centers is carbon-free.

The company is also benefiting from political backing. Even as politicians fight over renewable energy and fossil fuels, there’s considerable bipartisan support for nuclear. In its latest earnings presentation, Constellation featured pronuclear quotes from both President Joe Biden and former President Donald Trump.

The company received a significant benefit from the Inflation Reduction Act, which gives tax credits to nuclear plants. The law effectively put a floor under nuclear power prices around $43 per megawatt-hour, a level at which the plants can make money.

The tax credit establishes a floor for the industry. But investors are now convinced there’s a higher ceiling, too. In March, Amazon agreed to an unusual new deal with Talen Energy, a Houston company that just emerged from bankruptcy last year. Amazon bought a site next to Talen’s nuclear plant in Pennsylvania for $650 million and will receive power directly from the plant, instead of connecting to the larger transmission grid like most data centers, an arrangement known as “behind the meter.” Amazon could phase in the data centers, eventually using as much as 960 megawatts worth of Talen’s 2.2 gigawatts of nuclear capacity. Analysts estimate that the deal values the power produced by Talen at about $75 per megawatt-hour, well above the average market prices that Talen receives by selling into the grid.

Analysts have extrapolated the figures in the Talen deal to other nuclear names: Constellation would probably benefit the most, simply because it owns the most nuclear plants.

The company’s earnings per share are expected to jump 33% this year, and Constellation says it can keep growing base earnings by at least 10% annually through the end of the decade, largely because of data center opportunities. Morgan Stanley analyst David Arcaro thinks Constellation could sign Talen-like deals for about a quarter of its nuclear capacity. He boosted his price target on Monday to $193 from $166, based on those projected deals.

Vistra, the second-largest owner of independent nuclear plants, could benefit, too. The company made a prescient decision last year to acquire three nuclear plants with four gigawatts of capacity just as the market was improving. Its stock is up 190% in the past year, but Arcaro sees more upside, increasing his price target to $78 from $62.

Then there’s Public Service Enterprise Group, a multifaceted New Jersey energy company that also owns nuclear power. Although it hasn’t benefited much from the nuclear rally so far, Arcaro thinks the company could sell one gigawatt of its nuclear capacity into a lucrative data center deal. He upped his price target to $70 from $61.

In the short term, the handful of companies that own nuclear plants have little to fear from new competition. But eventually, new entrants are likely to shake up the industry. Several of them, backed by big-name investors like Bill Gates and Sam Altman, are betting on small modular reactors that can be built much faster than the enormous reactors currently in use, and can sit right next to data centers like the ones Amazon is building.

None of these small reactors has been built yet, and the industry has recently had some setbacks. NuScale, the company that was furthest along, announced last year it was canceling plans for its first reactors, largely because of rising costs. Rebello doesn’t expect any of them to start operating in the next three years, but he sees small reactors eventually benefiting from the data center surge, too. “The Amazon deal validates nuclear as being a solid partner for data centers,” he said. “Arrangements like this could lead to nuclear happening sooner.”

Legal scholars, lawmakers and at least one Supreme Court justice agree that companies will be liable for the things their AIs say and do—and that the lawsuits are just beginning.

If your company uses AI to produce content, make decisions, or influence the lives of others, it’s likely you will be liable for whatever it does—especially when it makes a mistake.

This also applies to big tech companies rolling out chat-based AIs to the public, including Google and Microsoft, as well as well-funded startups like Anthropic and OpenAI.

“If in the coming years we wind up using AI the way most commentators expect, by leaning on it to outsource a lot of our content and judgment calls, I don’t think companies will be able to escape some form of liability,” says Jane Bambauer, a law professor at the University of Florida who has written about these issues.

The implications of this are momentous. Every company that uses generative AI could be responsible under laws that govern liability for harmful speech, and laws governing liability for defective products—since today’s AIs are both creators of speech and products. Some legal experts say this may create a flood of lawsuits for companies of all sizes.

It is already clear that the consequences of artificial intelligence output may go well beyond a threat to companies’ reputations. Concerns about future liability also help explain why companies are manipulating their systems behind the scenes to avoid problematic outputs—for example, when Google’s Gemini came across as too “woke.” It also may be a driver of the industry’s efforts to reduce “hallucinations,” the term for when generative AIs make stuff up.

The legal logic is straightforward. Section 230 of the Communications Decency Act of 1996 has long protected internet platforms from being held liable for the things we say on them. (In short, if you say something defamatory about your neighbor on Facebook, they can sue you, but not Meta.) This law was foundational to the development of the early internet and is, arguably, one reason that many of today’s biggest tech companies grew in the U.S., and not elsewhere.

But Section 230 doesn’t cover speech that a company’s AI generates, says Graham Ryan, a litigator at Jones Walker who will soon be publishing a paper in the Harvard Journal of Law and Technology on the topic. “Generative AI is the wild west when it comes to legal risk for internet technology companies, unlike any other time in the history of the internet since its inception,” he adds.

I spoke with several legal experts across the ideological spectrum, and none expect that Section 230 will protect companies from lawsuits over the outputs of generative AI, which now include not just text but also images, music and video.

And the list of potential defendants is far broader than a handful of big tech companies. Companies that simply use generative AI—say, by using OpenAI’s tech as part of a service delivered to a customer—are likely to be responsible for the outputs of such systems. This is a potentially vast universe of services, ranging from evaluating investments to providing customer support.

Among the most compelling indications that companies won’t be protected by current law is Supreme Court Justice Neil Gorsuch’s early 2023 statement on the subject.

In discussing a Section 230 case before the court, he said: “Artificial intelligence generates poetry. It generates polemics today that would be content that goes beyond picking, choosing, analyzing or digesting content. And that is not protected.”

And as companies like OpenAI argue in legal briefs over whether scraping copyrighted content from the internet counts as theft of intellectual property, they may actually be hurting their case that they aren’t responsible for the content their systems produce.

Some AI companies have argued that their AIs “substantially transform” all the content they are trained on. That means, they argue, that they don’t violate copyright protections, under the doctrine of fair use. If that is true, it would seem to indicate they are “substantial co-creators” of the content they are displaying. That is the point at which a company is no longer merely hosting content, and loses the protection of Section 230, says Ryan.

Normally, when companies perceive a gap in existing laws, they lobby Congress for a fix. But lately, Congress has been keen to strip away some of the protections Section 230 already offers, by specifying that companies can only have Section 230 protection if they play by certain rules. Congress’s current mood is the opposite of what companies that make and use AI want.

“In the discussion about, ‘What do you want to do about Section 230’—the answer that many lawmakers will give you is ‘We should gut it,’ ” says Adam Thierer, a senior fellow at the R Street Institute, a conservative think tank. As a result, companies are eager to simply hold on to the existing law and not agitate for any changes, he adds.

The complicated work of figuring out how to apply old laws to AI might be best accomplished case-by-case in courthouses, says Bambauer of the University of Florida. “I’m even going to go out on a limb and say maybe it should,” she adds.

Her argument is, essentially, that by letting cases play out as new information about the harms and benefits of AI is revealed, companies might have the freedom to innovate—but could be reined in when they go too far.

OpenAI is being sued for defamation in at least two cases, including one in which a Georgia radio host alleges that the company’s chatbot wrote an answer that falsely accused him of embezzlement. The company has argued that it isn’t responsible for what its chatbot creates, because its product is more like a word processor, in that it is a tool people use to create content.

In a filing, OpenAI responded to the suit. “By its very nature, AI-generated content is probabilistic and not always factual, and there is near universal consensus that responsible use of AI includes fact-checking prompted outputs before using or sharing them,” its lawyers wrote.

The argument that ChatGPT is more like a word processor than an actual creator of content is likely to fail, says Jason Schultz, director of New York University’s Technology Law & Policy Clinic. “Microsoft Word gives you a blank document, it doesn’t give you a pre-scripted essay,” he adds.

Speech is one kind of liability for companies using generative AI. The design of these systems can create other kinds of harms—by, say, introducing bias in hiring, giving bad advice, or simply making up information that might lead to financial damages for a person who trusts these systems.

Because AIs can be used in so many ways, in so many industries, it may take time to understand what their harms are in a variety of contexts, and how best to regulate them, says Schultz.

Meanwhile, the legal uncertainty for companies that use generative AI, and resulting compliance issues and litigation, may create an unsustainable legal risk for many, says Ryan of Jones Walker. Some, like Therier of R Street Institute, believe this is a threat to the development of the entire field of AI.

Others think that making the legal threat manageable may be as simple as limiting how today’s generative AI tools are used. If making AI chatbots and things that resemble them leads to too many lawsuits, the companies developing the underlying AI technology may simply cut off access to it, says Michael Karanicolas, executive director of the Institute for Technology, Law & Policy at UCLA.

“If we have these tools, and large volumes of people are doing dangerous things as a result of receiving garbage information from them, I’d argue it isn’t necessarily a bad thing to assign cost or liability as a result of these harms, or to make it unprofitable to offer these technologies,” he adds.

Not only is the cost-benefit ratio unbeatable, but not to undertake this spending is to court disaster

In a world of polycrisis, in which intersecting problems compound each other and there are few easy wins, it is all the more important to recognise those policy choices that are truly obvious. Vaccines are one such investment. Since the 1960s, global vaccination campaigns have eradicated smallpox, suppressed polio and contained measles. Modest expenditures on public health have saved tens of millions of lives, reduced morbidity and allowed children around the world to develop into adults capable of living healthy and productive lives. 

After years of development, 2023 saw the approval of a second vaccine for malaria, a scourge which causes more than 600,000 deaths annually. A recent study on a vaccine for Strep A, a pathogen that causes 600,000 deaths and 600mn cases of pharyngitis annually, calculates that an investment of less than $60bn would deliver benefits in excess of $1.6tn. 

Even more spectacular is the success that was achieved against Covid-19, with fully certified vaccines deployed within less than one year. Even though we failed to provide them to many of the world’s poorest people, they saved at least 14mn lives. Restarting the world’s economy generated trillions in additional output. 

Being able to deploy a vaccine mid-pandemic opened a new chapter in medical history. At a summit co-hosted by the UK government and the Coalition for Epidemic Preparedness Innovations (Cepi) in March 2022, a new goal was announced of having safe and effective vaccines ready within just 100 days of the next epidemic outbreak.

That will take some doing. Covid vaccines could be developed so quickly because of years of research on the Mers and Sars viruses. To prepare for the next onslaught we must compile inventories of potentially dangerous strains and tighten global surveillance. We can try to predict which pathogens are most likely to provoke zoonotic mutation. Above all, we can start work now on the early stages of vaccine development for the dangerous diseases we already know. 

Of course, this will cost money. But compared with other major investments, scientific breakthroughs come cheap. To push at least one vaccine against the 11 epidemic infectious diseases to phase 2 trials has been costed at less than $8.5bn. In her book Disease X, the science writer Kate Kelland estimates that $50bn would pay for a comprehensive vaccine library. 

To expect that funding to come from the private sector is unrealistic. The work is too expensive and high risk and the returns too uncertain. Philanthropy and public-private partnerships may work. But ultimately it is governments that should foot the bill. Unfortunately, in public policy, pandemic preparedness is all too often relegated to the cash-starved budgets of development agencies or squeezed into strained health budgets. Where such spending properly belongs is under the flag of industrial policy and national security. 

Biotech is one of the most promising areas of future economic growth, combining research, high-tech manufacturing and service sector work. As the IMF declared: “vaccine policy is economic policy.” And pandemic preparedness belongs under national security because there is no more serious threat to a population. A far larger percentage of the UK died of Covid between 2020 and 2023 (225,000 out of 67mn) than were killed by German bombs in the second world war (70,000 out of 50mn). 

The annual defence budget of just one of the larger European countries would suffice to pay for a comprehensive global pandemic preparedness programme. The money lavished on just one of the UK’s vainglorious aircraft carriers was enough to have made the world safe against both the ghastly Ebola and Marburg viruses. 

Not only is the cost-benefit ratio unbeatable, but not to undertake this spending is to court disaster. In any given year, the risk of a Covid-level global pandemic with 20mn excess deaths is thought to be about 2 per cent. We will be lucky if we avoid another major pandemic in the coming decades. All the more so, because due to population growth and urbanisation, the risk of zoonotic mutation is steadily increasing. Climate change is compounding that effect. 

There is now a consensus that we must engage in investments running into the trillions to mitigate and adapt to climate change, transforming our energy infrastructure and our way of life. But for most countries you have to go very far out in the climate scenarios to generate an event as severe in terms of loss of life and economic cost as Covid. Measured by cost of a life saved, vaccines are far cheaper, more direct and fast acting than climate policy. 

This is not to play off global public health against climate policy. We cannot pick our challenges. But what we can do is to reduce the overload, which in 2020 threatened to overwhelm the decision-making capacity of our societies and our political processes. As Kelland remarks: “ . . . while epidemics are inevitable, pandemics are a choice”. If we fail to invest the modest amounts necessary to give us a fighting chance against major life-threatening diseases, it is not fate that consigns us to chaos, but narrow self-interest and collective short-sightedness. 

Monetising messaging apps is not easy, and listing changes the power structure and forces greater disclosure

Secretive messaging app Telegram claims that it is inching closer towards breaking even and going public. Dangling the possibility of an initial public offering has helped it secure more favourable borrowing terms. In keeping with the company’s anti-surveillance back-story, however, financial details are sparse.

Does co-founder Pavel Durov really want to run a public company? He has previously used his private wealth to fund Telegram and wants to maintain control. Opting for debt over equity fundraising means he can avoid diluting ownership, although it adds interest to the company’s overall expenses. Previous investor demand may not have been high. Last year he purchased a quarter of the bonds issued himself. 

In mid-March, Telegram announced that it had raised a further $330mn in a bond sale, taking total debt financing to $2.3bn since 2021. Once again, the potential IPO was used as a sweetener. Bonds can be converted to equity at a discount to the IPO price if there is a listing by March 2026. The company talks up a possible $30bn valuation but offers no details to back this up. 

Once hailed as Russia’s Mark Zuckerberg, Durov created Telegram in 2013. He left Russia the following year after refusing to share data with the country’s security agency. His exile plays an important role in Telegram’s origin story, reinforcing its guiding principles of privacy and security online. 

Taking the company public would change the power structure and force greater disclosure, although Durov could maintain voting control by issuing dual class shares. 

Monetising messaging apps is not easy. Users do not want adverts to pop up in their private messages. Signal relies on donations and Meta does not give profit figures for WhatsApp.

Telegram is not yet profitable. It told the FT that it makes “hundreds of millions of dollars” in annual revenue via digital ads, crypto payments and premium subscriptions. It is planning an AI-powered chatbot, but then who is not? Server costs are large. Durov described costs as less than 70 cents per user, which translates to around $630mn a year. Revenue is below that.

Selling tokens linked to its own blockchain effort could have funded the endeavour but it was shot down by regulators. However, Telegram still facilitates use of the tokens, called Toncoins, after developers took on the project. Toncoin’s price has climbed about 60 per cent in the past year. Talk of a possible IPO is proving lucrative in more ways than one.