What xAI and OpenAI Should Buy Next
Recently, a close friend of mine introduced me to another of his friends, a tech investment banker, and now this banker and I have become friendly, too. I’ve enjoyed learning a bit about his life. We’d not met before because he’s not around very much, with AI and tech and FOMO what they are these days. He lives right by one of the nicest beaches in California and has bought himself an expensive car. But he seldom seems to spend much time enjoying his seaside abode, and he’s burning the gas in his G-Wagon mostly to get back to the airport. He travels often for work, sometimes several times a week.
By his telling of it, investment banking sounds like an arduous, go-go-go profession. I don’t buy it, though, because it seems simple enough to me, and as it happens, over the past few days I’ve come up with a bunch of very plausible deals I think should happen.
Here’s the most straightforward one: xAI should buy Cursor. The two already have a blossoming relationship, with xAI agreeing to sell computing capacity to Cursor. That makes sense. The compute crunch is real. The fine folks at SemiAnalysis, the AI research outfit profiled in our latest Big Read, recently likened acquiring AI processing power to “trying to book airplane tickets on the last flight out.”
Joining up with xAI would give Cursor access to xAI’s “stockpile” of compute, as Business Insider termed it. (Imagine having a stockpile of compute! That’d be like laying out a smorgasbord in front of Tom Hanks in “Castaway.”) xAI, meanwhile, would get a leg up in the AI coding wars and gain its first real access to the enterprise market.
My second idea is slightly less plausible but still very fun to consider. I think Snap CEO Evan Spiegel should sell the company to OpenAI. Snap is slashing its staff in yet another attempt to engineer a turnaround, and it won’t work. None of Spiegel’s other turnaround efforts have. He should accept the inevitable and take the years he’s spent focusing on consumer hardware to a place that really, really wants to do consumer hardware. An added incentive: Whatever he came up with at OpenAI would have a much better chance of torpedoing Meta Platforms’ efforts to produce similar technology. And surely he would still like to take Zuck down a peg or ten.
At Snap, Spiegel has total power over the stock thanks to his supervoting shares. He’s the only one who can make the decision on a sale, and he has seemed resistant to the idea even as the stock has dropped and dropped and dropped. (A CEO with less control of the stock would’ve been ousted long ago.) But I think OpenAI’s recent acquisition of TBPN is real proof that it can win over founders who wouldn’t sell to anyone else.
Finally, let’s ponder what will happen to poor ol’ Vox Media, which will reportedly begin selling itself piecemeal. Vox owns more than 10 media brands, including New York Magazine, itself a collection of brands. If someone hasn’t already called Jay Penske, who owns a portion of the Vox parent company, they should—and they should talk him into buying Vulture, New York’s beloved outlet devoted to entertainment and Hollywood. Puck News says Karli Kloss has been interested in possibly buying The Cut, another beloved New York sub-brand. I find her interest intriguing: A couple years ago, I predicted that Vox Media would need to do a sale like this one and would sell New York Magazine to her husband, Josh Kushner. Clearly, my crystal ball tuned into the wrong corner of the Kushner-Kloss living room.
Vox also owns The Verge, the tech news site. I’m sure the same set of people who keep loudly talking about wanting to buy Wired might be interested in The Verge. They’d be buying it to profoundly change it, and I wonder if Vox CEO Jim Bankoff would want to be the one to push those brands into their hands. I also wonder if much of the Vox brands would get sold off to owners who seem to apparate out of nowhere, as Jeff Lawson did when he bought The Onion.
I’m gonna stop here and go try to track down that banker I mentioned. I expect a fat finder’s fee.