Can you smell what the Grok is cooking...

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• xAI raises more cash: Grok remains one of the more controversial LLMs on the market today, but that has not slowed down parent company xAI even a little bit. The AI concern announced a new $20 billion Series E round, surpassing its original target of $15 billion in new funding. WSJ and CNBC had previously noted that the company was looking for extra cash in November of last year, which CEO Elon Musk had tagged as “false” at the time.

• UMG teams with Nvidia: Universal Music Group — the world’s largest music company — has teamed with the chip manufacturers on a new program pioneering “responsible AI for music discovery, creation, and engagement.” This includes a focus on “rightsholder compensation,” a hot topic in the generative AI space, particularly as it concerns music-themed products. (You’ll recall that AI music creator Suno recently settled an ongoing lawsuit with Warner Music Group over this issue.) Billboard suggests most of the work will center on Nvidia’s “Music Flamingo” initiative, which breaks down and analyzes music based on a variety of deep metrics and variables beyond just “genre” — think aspects like lyrical context, music theory, key, tempo, and harmonies — and could revolutionize music discovery, and the way algorithms recommend new songs or artists.

• LMArena valued at $1.7 billion: The startup’s crowdsourced leaderboards rank top AI models based on performance, and have become an important industry standard in terms of gauging overall quality. Though it started life as a non-profit research project called Chatbot Arena at UC Berkeley just a few years back, LMArena has already grown into a sizable for-profit company, now valued at $1.7 billion, following a $150 million Series A. 5 million monthly users across 150 countries are now using LMArena to test and rank AI models. They’ve also added a commercial service — AI Evaluations — that help AI startups’ improve their models’ performance with the community. That’s given them a “consumption rate” (their version of annual recurring revenue) of $30 million as of December.

TWiST 500

One of our favorite under-the-radar robotics startups is Mentee. Their AI-powered humanoid robot — cleverly named the MenteeBot — comes standard with a “lifelike gait” and agile hand movements, but it’s primarily designed to allow users and enterprises to self-train (or “mentor”) their bots for more specialized applications.

The company comes from co-founder Ammon Shashua, who announced this week that it will be acquired by his OTHER company, autonomous driving outfit Mobileye, for $612 million in cash and 26.2 million in stock. Shashua reportedly recused himself from the Mobileye process of considering and approving the acquisition.

So what does a company that develops self-driving car and driver assistance tech want with humanoid robots? Well, that’s not ENTIRELY clear in an immediate sense. Mobileye in a statement said that the goal is “broaden[ing] the scope of the business with a decisive step toward Physical Artificial Intelligence.” TechCrunch suggests perhaps Mobileye is moving beyond self-driving cars, and will use their and Mentee’s technology to help AI agents navigate the physical world more generally? It’s as good a guess as any.

Finally, it’s a bittersweet moment when a long-time stalwart of the TWIST 500 gets ready to move on, but in the case of Discord, we can all agree that it’s about time.

The iconic messaging and community platform has reportedly entered the IPO process (if Bloomberg is to be believed), and they’re working with Goldman Sachs and JP Morgan Chase on the listing. Though these plans could of course still fall through, there is an air of inevitability around a Discord public offering at this point. The platform is over a decade old, and counts more than 200 million dedicated monthly users. During their last round of fresh funding (back in 2021), the platform was valued at around $15 billion, and they had reportedly rejected a $12 billion acquisition proposal by Microsoft around that same time.

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E2230: New year, new TWiSTs. We’re starting 2026 with a look at Meta’s behind-the-scenes AI drama, Nvidia’s “acquisition” of Groq and what it means for his bestie Chamath, Twitter co-founder Biz Stone’s new social media app Tangle, PLUS another check-in with the sharps at Polymarket.

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E2228: Jason gets asked a LOT of questions by fans, and there’s never enough time to answer them all… until now! We’re dedicating an entire year-end episode to pressing questions from viewers and founders. Find out what to do when a VC reaches out cold to your startup, why Jason thinks there’s room in the future for BOTH AI Agents AND great SaaS companies, whether European companies should take local investments if they’re aiming for US customers, Jason’s dream mega-purchases when he his $1 billion, and lots more.

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