So... SaaSpocalypse NOW?

Top News

• Thoma Bravo writes off Medallia: According to Reuters, the private equity firm plans to hand over SaaS company Medallia to its lenders after months of restructuring talks. The agreement wipes out $5.1 billion in equity for Thoma Bravo and its investors; they picked up the customer service software firm for $6.4 billion in 2021. The company’s value took a major hit over the last few months, as justifiable concerns about the incursion of AI tools into the enterprise software market, continued to mount. Medallia has been struggling under the weight of about $3 billion in debt, but the overall concerns around the defensibility of legacy SaaS companies is hardly isolated to them. In February, Bloomberg reported that around $17.7 billion in tech company loans have dropped to “distressed” trading levels.

• X shuts down Communities: In 2021, back in the “Twitter” days, the platform launched Communities as a place for users to connect around shared interests in real time. This week, X head of product Nikita Bier announced plans to terminate the feature, arguing that it’s under-used and plagued by spam. Specifically: “Communities had a great vision, but they were used by less than 0.4% of users—yet contributed to 80% of spam reports, financial scams, and malware on X.” The overall plan seems to be pushing Communities fans to group chats, specifically XChat, which xAI plans to spin off into a standalone app. Some of the largest Communities — including the 250K member strong “Build in Public” — are migrating to their own off-X destinations.

• Salmon brings digital banking to The Philippines: Millions of adults in The Philippines don’t have bank accounts, and a new Manila-based fintech app hopes to turn that around. Salmon raised $60 million in equity and $40 million in debt to introduce digital banking to the island nation. It was founded by three veterans of the Russia-based digital bank Tinkoff, who spotted the Southeast Asian opportunity while expanding that company’s footprint. The combination of The Philippines’ very active mobile market — and young, tech-savvy population — with a relatively archaic financial system, seems to be the sweet spot.

TWiST 500

A few quick hits from some T500 All Stars on this rainy Austin Thursday…

• OpenAI drops ChatGPT for Clinicians: The company’s latest free-to-use chatbot was designed specifically for licensed physicians, nurses, physician assistants, and pharmacists. The company also announced a new clinical medicine benchmark system, HealthBench Professional; they claim GPT-5.4 outperforms human doctors on this test. There’s been some legal pushback on chatbots giving out the kinds of advice for which you’d normally turn to a licensed professional, such as a physician. This may be the company’s attempt to split the difference.

• Beehiiv adds new creator tools: Updates include the ability to host webinars on the platform, tiered paywalls, paid trial offers, and AI analytics tools. It’s part of an overall attempt to transform The Hiiv from a strictly newsletter-focused operation into what TechCrunch terms an “all-in-one hub for creators.” It also feels like a direct broadside against Beehiiv’s most notable rival, Substack, which already features a lot of native tools for various kinds of content creators, but continues to face controversy over its free speech and moderation policies.

• Anthropic hits $1T+ value on secondary markets: On the Forge Global private marketplace exchange, Anthropic’s valuation is hovering around $1 trillion. This puts it AHEAD of rival OpenAI, which was valued at $852 billion earlier this year. Business Insider further reports that Anthropic share owners are getting “hounded” with purchase offers. The same sources claim there’s “slumping demand” for OpenAI. These kinds of reversals, based on whoever has the hottest model of the moment, are not unheard of in the AI space, but the narrative that Anthropic and Claude have firmly secured the lead has now fully taken hold. – Lon

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This Week in Startups

E2279: SpaceX and Cursor are building a frontier model together, and later this year, SpaceX has the option to buy the AI coding company outright for $60 billion, or pay them $10 billion for their work. Alex and Lon break down the deal on a special TWiST. Then we chat with Chris Zacharia and Brian McCrindle, the founders of Bitstarter, the Kickstarter for Bittensor, and Ning Ren of competitive skill marketplace TrajectoryRL.

E2278: Jason and Lon greet Eragon CEO Josh Sirota, who argues that companies are giving away too much proprietary data to model companies like OpenAI and Anthropic. Instead, his company trains custom models for companies based on all of their documents, which they own and control. Plus we’ve got IONA Drones founder Etienne Louvet discussing why his company is licensing their aviation delivery tech to logistics operators rather than going direct to customers (like rival Zipline).

E2277: Jason Ballard of ICON joins the show to talk about how 3D printing homes can not just help us solve the housing crisis, and help humanity colonize the cosmos, but could also lead the way to a more beautiful and aesthetically pleasing future. Plus Jason and Lon chat with Seby Rubino of Resi Labs about designing the “oracle,” which can guess the price of any home with 98% accuracy. Is this a potential Zillow Killer?

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