AI | Nvidia agreed to develop AI infrastructure platforms with Apollo, Blackstone, BlackRock, Brookfield, KKR, and Goldman Sachs, mobilizing more than $500 billion of third-party capital through private-asset-like structures and asset-based financing. Jensen Huang told CNBC his chips are now "an investable infrastructure asset," which is a chip company describing its inventory as collateral. Goldman analysts counted $1.5 trillion in hyperscaler lease commitments for data centers, R&D facilities, offices, and equipment, up from roughly $200 billion five years ago. About $1 trillion of that is "uncommenced," meaning it doesn't appear in financial statements yet but will produce payments later. Then the bond market started pushing back. AI hyperscaler debt issuance reached $220 billion in 2026 as of August 10, per BNP Paribas, against $12.5 billion in the same period last year. Tech corporate spreads now sit at 89 basis points, 9 wider than the overall investment grade market, a reversal for a sector that spent a decade with the tightest spreads in credit.

IPO WATCH | Anthropic is heading for what could be one of the largest IPOs ever. The company filed confidentially on June 1 and is targeting a listing as early as October, with bankers reportedly discussing a valuation around $1.5 trillion. To justify that, they are reaching all the way out to projected 2028 revenue of $190 billion to $200 billion, against a current run rate of $47 billion, because the business is growing too fast to price on the numbers it's actually posting today. Valuing a company off revenue two years out is unusual, but it isn't entirely brand new. SpaceX went public on June 12 at $135 a share, raising about $75 billion at a $1.75 trillion valuation, the largest IPO ever, and closed its first day up 19%. Cerebras leaned on its own 2028 projections before debuting in May, and OpenAI is laying groundwork for a Q4 listing near $1 trillion.

ECONOMY | On July 30, Trump signed a Presidential Determination under Section 101 of the Defense Production Act of 1950, handing Commerce Secretary Howard Lutnick the authority to restrict exports of recovered critical minerals. The list includes black mass (the shredded remains of lithium-ion batteries, which carry lithium, cobalt, and nickel), end-of-life rare-earth magnets, and metal scrap. Commerce moved fast, publishing a rule that requires sellers of black mass and tungsten scrap to route 100% of their monthly volume to domestic buyers from August 27, 2026 through August 27, 2027, skipping the usual public comment period. Tungsten is the point of emphasis. The US hasn't mined it in over a decade, it goes into armor plate and ammunition, and China placed it under export control last year. The complication came from the Government Accountability Office, which reported days earlier that the US needs two to ten years to build the substitution and recycling capacity to actually process this material, especially for batteries and chips.

PRIVATE EQUITY | Private equity is holding 33,575 companies it hasn't sold, according to PitchBook, up from 32,451 at the end of 2025 and roughly 15,923 a decade ago. Second-quarter exits came to about $100 billion, half of the first quarter's total, and sales from one PE firm to another fell nearly 40% quarter over quarter, the weakest in at least ten years. IPOs absorbed some of the backlog, rising from about 10% of exit proceeds in Q1 to a third in Q2. 70 PE-backed companies have gone public since 2022, against more than 400 between 2017 and 2021. Pension funds own these positions at untested valuations, and founders who planned to sell their businesses to a PE buyer are finding fewer bidders.

THE MIDDLE LAYER | Nvidia agreed to buy Hugging Face, the open-source model hub, for $12.9 billion, a company it tried to invest in last year at a $7 billion valuation and was turned down. A week or so earlier, Stripe bought OpenRouter for more than $7 billion, roughly five times its valuation from a Series B three months prior. Both companies sit between developers and the AI models, routing requests to whichever model fits. Nvidia wants a healthy open-source ecosystem so customers have alternatives to the in-house chips that OpenAI, Google, Amazon, and Anthropic are all now building, which keeps demand on Nvidia hardware. Stripe wants to move AI tokens between companies the way it already moves dollars.

HEALTHCARE AS AN AI HEDGE | Investors nervous about AI have started hiding in drug stocks. Semiconductors and healthcare, which used to move independently, have flipped to a negative correlation this year, per FactSet, so when chips fall, pharma tends to rise. From late June to late July, as the market questioned whether the AI rally could hold, healthcare beat semiconductors by more than 30 points. The appeal is that people fill their prescriptions regardless of the AI trade, and pharma is cheaper, trading around 18 times forward earnings against 22 to 30 for chips. The last time this happened was 2022, when healthcare also outran semiconductors by 30 points during a tech selloff. 💊

THE DOJ v a16z | The Justice Department has spent nearly a year investigating Andreessen Horowitz over whether two of its partners sit on the boards of competing companies, Bloomberg reported. Ben Horowitz is on the board of Databricks, which raised $5 billion at a $190 billion valuation this month, and general partner Martin Casado is on the board of Fivetran. Section 8 of the Clayton Act bars the same firm from placing directors at rival companies. The DOJ has argued that different people from the same firm can still count as a violation. The two businesses have drifted into each other's lanes as Databricks pushed into data ingestion, Fivetran's core market. a16z manages over $100 billion, and its $15 billion January raise was more than 18% of all US venture capital in 2025. When one firm funds that much of the market, its portfolio companies are bound to bump into one another. 👮

TARIFF ON DRONES | Trump signed a proclamation on August 13 slapping tariffs on imported drones, including from close allies. The rates run 100% on larger drones with sensitive capabilities, 25% on smaller ones, 15% on drones and parts from the EU, Japan, South Korea, Switzerland, Taiwan, and a few others, and 10% from the UK. Commerce Secretary Howard Lutnick ran the investigation behind it and found that the US leans too heavily on foreign drones and can't build enough of its own to meet security needs. The US is currently moving towards a domestic industrial base for defense hardware. 🚁

AI Compute is Becoming an Asset Class 🤖

everything is downstream of ambition 🏃

Go Big or Go Broke 🐘

Parallel vs. Serial 🛣️

Kushner & Iger’s $12.5B Lakers Deal [0.5 hr]

Microsoft’s Deputy CISO on Securing AI Agents [0.5 hr]

Know which rules to break [0.5 hr]

September 15-17, Brett and Willy will speak at Main Street Summit

Annual General Meeting with Redbud LPs and founders September 17-18th

Hosted a Roots Happy Hour in Kansas City with leading operators and technical talent, co-hosted with Husch Blackwell and Social Balances.

Attended the Residency demo day in San Francisco.

Hosted a Roots Happy Hour in St. Louis with leading founders and operators, hosted in partnership with Cultivation Capital, TechSTL, and Transitions Law Group.

Hosted a Roots Happy Hour in Miami with top HealthTech talent, co-hosted with Elan Adler at OneImaging.

Hosted a Roots Happy Hour in Springfield with leading operators and technical talent, co-hosted with Codefi and eFactory.

Atlanta-based Axle Labs closed a $17.5M Series A

Loom Security wrapped a $3M Seed, based in Kansas

Finley, a North Carolina-based company, closed a $2M Seed

Columbus-based Blend raised a $12M Series A

Utah-based Quantizr raised an $5M Seed

Chicago-based startups closed a few rounds this month

Across Texas

Minnesota-based Yardstik wrapped a $30 Series B