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Top News

• OpenAI developing “smart” devices: A report from The Information suggests that OpenAI is busily working behind the scenes on a number of AI devices, including smart glasses, a smart speaker, and even a smart lamp. The speaker apparently includes a camera, allowing it to learn about its environment and owners visually as well as via audio. The glasses will follow in 2028. Fewer details are available about the “smart lamp” projec, and if it’s an original concept or a variation on the laundry-folding robot arm concept introduced last summer by Lume in an (animated!) viral pitch video. Presumably, all these devices will have design input from iconic former Apple innovator Jony Ive, whose startup io was picked up by OpenAI last May for $6.5 billion.

• Google may invest in Fluidstack: WSJ reports that Google is in talks to invest $100 million in Fluidstack, an AI “neo-cloud” infrastructure platform that aggregates under-used data center capacity, opening up access to high-performance GPU clusters. (It’s one of the key rivals to breakout cloud computing concern, and former T500 all-stars, CoreWeave.) The deal apparently values Fluidstack at a tasty $7.5 billion. Google apparently hope to not just earn healthy returns on their investment, but encourage more computing providers to switch from Nvidia chips to its tensor processing units (aka TPUs).

• Code Metal closes $125M Series B: The Boston-based startup uses AI to generate code, and then translate it into a variety of different coding languages. While there are a vast number of startups in the business of creating and verifying AI-generated code, Code Metal is aimed exclusively at the defense industry, and counts both Raytheon and the US Air Force as early adopters. The focus specifically on code translation also helps set it apart. As Code Metal CEO Peter Morales points out, otherwise fast-moving projects can get bogged down when porting old code into new applicants, especially if the developer team isn’t immediately familiar with an older, more archaic programming language. Their Series B follows hot on the heels of the company’s $36 million Series A, which closed just a few months ago.

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The other day, we discussed Perplexity’s eyebrow-raising decision to pull back on ads, noting that they can negatively impact the perceived trustworthiness of AI chatbot responses. That’s a major shift in strategy. Recall, in June 2024, CEO Aravind Srinivas told Harry Stebbings that ads would become the backbone of Perplexity’s business model, noting “with advertising we could be really really profitable.”

Now, Wired has some additional insight on the company’s reasoning. Apparently, the ad shift is part of a larger effort to reposition Perplexity from a public-facing substitute for Google Search into a subscription-based tool for enterprise customers (and others willing to pay top dollar for access). The goal is to become “the most accurate AI service for developers [and] enterprises.”

The Plex will reportedly bolster these plans by forging new relationships and partnerships with device-makers, and also have designs on becoming more of an orchestration layer, where users can work on projects while selecting from a variety of available models.

This pivot, of course, makes more sense when considering how Perplexity has struggled to convert new users, especially compared with break out tools from rivals like OpenAI, Google, and Anthropic. According to Wired’s numbers, Perplexity’s monthly active users — not counting early adopters of the company’s Comet browser — top out at around 60 million, less than 10% of the audience for ChatGPT and Gemini.

With over 800 million people using ChatGPT each week, even low-impact ads equal a massive flood of new revenue. Perplexity can’t compete on that level, so a re-brand to focus exclusively on enterprise clients makes sense. – Lon

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This Week in Startups

E2252: OpenClaw Mania continues with Alex and a trio of expert builders: YouTuber Matthew Berman, NextVisit co-founder Ryan Yannelli, and Massive CEO/co-founder Jason Grad. They’re showing off their own personal projects, and also discussing what it’s going to take to get mainstream people as excited about OpenClaw as startup founders and tech nerds. Will there be a killer iPhone app bringing OpenClaw to the masses, or is this another geeky trend that will never hit the monoculture?

E0001: That’s right, it’s the FIRST EVER episode of our brand-new spinoff series, “This Week in AI”! On Episode 1 (“The Claw Awakens”), Jason welcomes an expert panel of AI-first founders — including Mitesh Agrawal of Positron, Kash Ali of TaxGPT, and Alex Elias of Qloo — to discuss the rise of OpenClaw, and how AI agents can move beyond helpful time savers and into full-on teammates and collaborators.

E2251: OpenAI hasn’t exactly ACQUIRED the open-source free AI virtual assistant OpenClaw, but it hired the project’s creator, Peter Steinberger. The company has promised to keep OpenClaw true to its open-source roots but what does this really mean for the project’s future? Jason and Alex play out the best and worst case scenarios with special guest experts Hiten Shah and Jesse Genet. PLUS we’re talking about the ethical implications of AI Scott Adams with his creator, John Arrow.

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