Everyone hates California’s AI bill

Top News

• OpenAI calls out proposed California AI bill: In an open letter, AI titan OpenAI argued that California’s contentious SB 1047 proposal is a mistake. Instead, in the company’s view, “a federally-driven set of AI policies, rather than a patchwork of state laws, will foster innovation and position the U.S. to lead the development of global standards.” SB 1047 proponent State Senator Scott Wiener responded, arguing that it’s “notable” that OpenAI’s letter “doesn’t criticize a single provision of the bill.” Many well-known California members of Congress have also come out against the proposed law.

• Lux backs Brazilian fintech Magie: Magie wants to use an AI assistant that will, TechCrunch reports, allow “people to send money and pay bills through WhatsApp.” The effort has enough legs that the startup just added $4 million to its coffers, bringing its total capital raised to date to $5.1 million. Latin American venture dealmaking has slowed since the last boom, making Lux’s first deal in Brazil all the more potentially impactful.

• Windows Recall is still getting tweaked: One way that consumers are being introduced to AI is through AI features brought directly to their hardware via firmware updates. Android is getting AI. iOS is getting AI. And Windows is in on the game, too. One AI feature for Windows, called Windows Recall, however, was delayed earlier this year due to privacy concerns. Now it’s looking like folks can play with it in October. Not this summer, as was originally planned.

It’s getting chippy out there

No, we’re not talking about a football match. We’re talking about private-market companies that are busy building the hardware that underpins today’s AI gold rush. Given capital expenditure trends from hyperscalers and smaller cloud players alike, folks making chips, racks, switches, and other networking and computing gear are doing quite well.

Nvidia’s last few years are now business lore, and Astera Lab’s financial glow-up was enough to take it public earlier in 2024.

Who else is in the ring? We’ve discussed Etched and Rebellions here before, but it’s time to add a few more names to the TWiST500. My argument is simple: The massive spending spree that we’re seeing today — and should continue for several years — will mint enormously valuable new public companies. Or at least startups and their backers are betting as such. And I think that they are right.

So, three new bright lights are heading onto the list today:

• Tenstorrent: With $334.5 million in known capital raised (Crunchbase), Tensortorrent may have pinged your radar when it closed $100 million from Hyundai and Samsung earlier this year. What is super interesting about this company is its computing products' modularity (scalability?). It sells single boards to servers packed with them. Indie developers can buy them one at a time; big companies can buy them in bulk formats. Product flexibility, capital, a huge market to sell into, and major backers? Onto the list!

• Enfabrica: Unlike Tenstorrent, Enfabrica is not building digital brains. It’s building digital bones and sinew. By that, I mean it’s not trying to build processors to crunch AI numbers. Instead, it builds SuperNICs, which Nvidia defines as “a new class of network accelerators designed to supercharge hyperscale AI workloads in Ethernet-based clouds.” Enfabrica says that it has built the first “multi-GPU SuperNIC chip.” Faster and more efficient GPU usage inside data centers sounds like a pretty good place to attack the current market, I reckon.

• Celestial AI: Celestial AI made noise in March by raising $175 million. Why the new capital? It wants to solve the so-called ‘memory wall.’ What is that? A recent paper describes the situation as when “the main performance bottleneck [for AI model training] is increasingly shifting to memory bandwidth.” That’s not good! But Celestial AI reckons that its ‘Photonic Fabric’ will solve the issue by allowing for the “deliver[y of] data directly to the point of compute.” If it can pull that off, I presume that its order book will start reading like War and Peace.

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