Robinhood’s up 14%, AppLovin 11%

Top News

• Anduril, Meta snag government contract: The previously-announced tie-up of Meta (a social media giant), and Anduril (a defense-tech unicorn) is back in the news this week after being awarded a contract to produce “prototypes of a new combat goggle.” A rival company, Rivet, got a competing contract that it says is worth $195 million. Heres’ hoping that for $400 million or so we get some slick combat headgear. For Meta, the contract could make its long-running investment in VR and the metaverse slightly more palatable to investors.

• Anthropic backs CA AI regulation: Stating that it favors national rules instead of state-based regulation, AI giant Anthropic will back California’s SB 53. The bill, which regulates powerful AI models by requiring their makers to “develop and publish safety frameworks,” report “critical safety incidents” quickly, and protect whistleblowers. The proposed bill has racked up opposition from industry groups, making Anthropic’s support all the more notable.

• Robinhood, AppLovin soar: After it was announced as last week closed that American tech companies Robinhood and AppLovin would be added to the S&P500 index, investors pounced. Shares of Robinhood (consumer fintech) are up 14% today, while AppLovin (mobile app monetization) are up 11% in the wake of the news.

TWiST500

Databricks is a great American company that has sadly gotten lost in the private markets. To wit, the data storage, analytics and AI company announced today that it crossed the $4 billion annual run rate mark in the second quarter, growing at more than 50% per year. Even more, Databricks’ AI products have cracked the $1 billion run rate threshold, and the company had positive free cash flow in the last twelve months.

How is it growing so quickly with negative operating cash burn? One thing that helps is net retention of more than 140%, per the company. That means its existing customers are throwing more and more revenue (read: demand) at Databricks each and every year.

Naturally instead of going public on the health of its business results, Databricks has raised another $1 billion from private-market investors.

On one hand, we get to keep Databricks in the TWiST500 for a while longer. On the other hand, by the time Databricks files and lists I suspect I’ll be dead. Anyway, with a valuation simply pegged at “over $100 billion” Databricks is worth no less than 25x its Q2 run rate. At 50% growth that’s 17x next year around this time. Perhaps it will go public then.

I’m kidding. Databricks won’t list until it has run through the alphabet. — Alex

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This Week in Startups

E2174: It’s a special pre-recorded Friday TWiST. Jason, Alex, AND Lon open the show by following up the “KPop Demon Hunters” debacle. Sony Pictures’ CEO says the movie wouldn’t have been a theatrical hit and Netflix was the best home for it… But Jason isn’t buying it. PLUS Jason’s response to Lina Khan on The Bulwark podcast, his “two stock markets” theory, why Atlassian wanted to buy a browser company, Google’s anti-trust remedies, and MUCH MORE.

E2173: It’s a 70 minute plus autonomous driving deep dive on a brand new TWiST as Jason and Alex welcome Nuro co-founder and president Dave Ferguson. Together they unpack Nuro’s new mega-deal with Lucid and Uber, and look ahead to the arrival of fully driverless SUVs to Uber by next year. PLUS they’re evaluating claims that autonomous rides could one day be cheaper than driving a car, and look at ways to keep costs down, via high-tech chips, off-the-shelf sensors, and other hacks.

E2172: Jason and Alex are back with a packed new TWiST. First up, as humanoid robots become increasingly visible on our streets, and in our lives, is human vs. clanker violence INEVITABLE? Plus…. Apple’s open-source AI models have started to impress, triggering a rethink of the hardware giant’s position in the ongoing race. PLUS another hit model from Grok, Jason’s thoughts on the importance of curiosity, AND a chat with Runbin Dong of Scale Social about knowing your worth as a founder.

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Angel University is Back!

Jason and Mike Savino are hosting our next virtual Angel University workshop on Tuesday, October 7. Jason will share proven strategies he’s used to invest $200M+ in over 500 startups. Whether you’re new to angel investing or looking to sharpen your skills, this is your chance to learn directly from one of the most active angel investors in the world. Register now at angel.university!

Founder U is Coming to the MENA Region!

Our 12-week pre-accelerator—designed to help early-stage founders build and grow—kicks off this fall in Saudi Arabia. The first cohort launches in Riyadh on November 3rd, followed by in-person and virtual sessions throughout the program. Founders in MENA: this is your chance to turn your idea into a business and get world-class insights on building a successful startup. Apply today: https://mena.founder.university/

SF Live-Work Space Now Available

Need a flexible living and working environment in San Francisco? This thoughtfully designed loft-style residence at 787 Bryant St., the heart of the vibrant SOMA district and the city’s creative hub, is now available for rent or purchase. Check the listing for more details.

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