X + xAI = Profit?

Author

Alex Wilhelm
April 21, 2025 • Estimated Reading Time: 8 minutes

Top News

  • Even more capital for AI giants? After merging with X, foundation model company xAI may be on the path to raise new capital, CNBC reports. The Anthropic and OpenAI competitor — all three are TWiST500 companies — has raised more than $12 billion to date, helping it build a massive data center and release models that ranked on global leaderboards. After its combination the network formerly known as Twitter, xAI affixed a $100 billion valuation to itself. That makes it worth more than Anthropic, on paper, but only a third of what OpenAI is valued at today.

  • US talent pipeline slows: Many leading American technology companies were founded by immigrants, or the children of immigrants. But the firehose of international talent hoping to live and build in the United States may be slowing down. At present, many international students are seeing their legal access to the country revoked, often over seemingly minor infractions or completely occluded reasons. If the pattern continues, other nations’ startup scenes could benefit from homegrown talent staying put.

  • 20 new unicorns thus far in 2025: TechCrunch counts twenty new unicorns minted in the first quarter of 2025 — putting the year on pace for eighty. That’s above what we saw last year but still far under the pace seen in the ZIRP era and the post-COVID timeframe. Amidst angst concerning trade and the stock market, it’s good to see startups from Hippocratic AI to Assured to Truveta crack the billion-dollar valuation mark to get the year started. More, please.

TWiST500

TWiST500 member company Bluesky appears content to ape old Twitter methods of verifying users, something that went so well the first time. Perhaps better than the new system, perhaps not — depending I reckon on whether or not you were verified the first time ‘round.

But instead of jawing about that, we have news. As promised, Lon and I have uploaded the next cohort of TWiST500 companies, bringing the list to 318. We already have names percolating for the next batch, so expect us to reach 400 by the end of Q2. At that point, we’ll work through the list to remove exited names and gather our druthers for the push to 500.

Who joined? Among the 18 new names, a few favorites:

  • NexGen Cloud: NexGen recently raised capital to help it expand its EU-friendly AI cloud. We’re bullish on long-term AI compute demand, and with the global order shaking itself up and many nations preferring computing clusters that comport to their bloc rules, it’s a great time for EU cloud providers. NexGen in particular cited local demand in its recent fundraising report.

  • Glean: Which company reached $100 million ARR this year and rhymes with bean? Precisely. Glean is a company whose product I have used — and while I was not the biggest fan as a user, the company’s growth as a SaaS-cum-AI company is notable. The company puts its pace to $100 million worth of annual recurring revenue as somewhere between Slack’s and GitLabs’ trajectory.

  • Hammerspace: We discussed this company on the show recently. The gist: Hammerspace is one of a few companies — Tailscale (private, TWiST500 member) and Astera Labs (public) are others — that’s busy selling the AI equivalent of picks and shovels to datacenter buildouts. In the case of Hammerspace, it helps companies access their unstructured data rapidly in an AI context. Given that proprietary data in AI use cases is digital gold, Hammerspace could become a key player in our AI future. Even if one that is more behind the scenes than, say, a foundation model company.

The entire TWiST500 list is pretty damn cool. I’m more than stoked about how it’s coming together. More soon, and keep in mind that we’re hosting member companies for regular interviews. So, don’t miss the show if you want to learn more about the startups we’re the most excited about. — Alex

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This Week in Startups

E2114: It’s Friday TWiST! Jason, Alex, and Lon chat about LMArena’s pivot from research project to full-blown company, the rise of application-layer AI startups, and they muse about the future of autonomous drone and weapons systems. PLUS a brand-new “Tips from the Trenches” featuring design and product UX advice from branding expert Scott Bair!

E2113: On a brand new TWiST, Jason, Lon, and Alex examine Figma’s surprise IPO filing (sorry, Adobe…) and make some informed guesses about OpenAI’s new social media plans. PLUS a chat with Chris Tung about his comic book art marketplace Nerd Crawler AND Steven Borrelli of Cuts Clothing gives us the lowdown on his viral appeal to President Trump and how tariffs are wrecking havoc on his ecommerce business.

E2112: On a very special TUESDAY EDITION of This Week in Startups, Alex chats with the founders of not one but TWO companies at the forefront of so-called “Vertical AI.” (That is, AI applications tailored for specific industries or use cases!) First up, Abacus founder David Moscatelli tells us about how they help banks and insurers install data-secure LLM systems. Then, Victor Riparbelli walks us through how his company, Synesthesia, is turning internal documents into scalable AI video.

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