October 3 2025
- Push up challenge
- EA going private
- $55B
- Silver Lake, Saudi PIF, Kushner’s Affinity Partners
- Games are huge - 3B DAU
- IP creators (EA, etc) vs Gatekeepers (Microsoft, XBOX, Playstation, etc)
- This is a huge asset - probably bigger than social media - but creators don’t win enough
- AI will accrue to video game entertainment much more than social media or traditional media engagement - this is one view - and could explain part of the thesis for this deal (at least in potential)
- Deflationary effects of AI will give people more free time - so general market for entertainment will grow - Gaming is a huge part of entertainment
- Saudis are going big after gaming - chunks of blizzard, take2, etc - and whole games/companies, etc
- Why is PE becoming so large?
- When too much money goes in, returns compress
- Distributions on Paid in Capital - DPI is more important than IRR - this has been less in PE recently - so money will leave this asset class
- SPAC 2.0
- Traditional IPO, Direct Listing, Reverse Merger (SPAC)
- Hoping for improvements from SPAC 1.0
- AI rollup opportunity
- Transform businesses with AI - like Josh Kushner doing at Thrive - roll up of CPA firms
- People incentives at typical PE companies is misaligned to AI outcomes
- Maybe there’s a new kind of private equity that can execute this well
- Owner operated model is the only way the AI transformation happens
- AI video generation/game generation can help create new content opportunities - just do it genuinely
- Jason selling mahalo.com
- OpenAI, Meta releasing video generation
- New media will distribute production (vs trad media where its centralized production and distributed consumption)
- Deepseek’s new model
- Cheaper costs
- Might herald a new architecture of how models work and how much energy they consume
- 8090 redirected a lot of their workload on bedrock to kimik2 on groq and it was quite cheap
- hard to hot swap models because prompts, etc don’t just work interoperably
- Getting worse the more complicated tasks companies undertake
- Open source is a big check on the power of big tech
- Open source running on your own infrastructure is cheaper if you know what you’re doing
- Question about whether the OSS models have backdoors - relying on safety testing by the infra providers (AWS, Groq, etc)
- Jensen said - no one wants nuclear weapons, everyone wants AI - so the view of doomers and policy makers from a couple of years ago was completely wrong - AI is highly decentralized - 5 major US companies, like 8 Chinese startups, etc
- AI energy problem will become worse sooner
- Energy costs are doubling due to AI companies and they will take your jobs - that’s a bad look
- Need energy fast - nuclear takes 5 years, natural gas needs gas turbines but there is a backlog on those
- So can we squeeze it out of the grid?
- State AI regulation
- CA SB53
- Insane requirements - need govt intervention to deploy models, etc
- These guys just want control over private market actors and their actions
- They have no idea what they are talking about and have no idea what they want
- Worse than EU style regulations
- 50 authorities instead of 1
- Look how CO law from 2024 talks about algorithmic discrimination
- These things just want to add a DEI layer to AI outputs
- We already saw this with the car market - how CA emissions vs rest of the country hurt the manufacturers
- We already have statutes that protect people from harm
- These regulations are not about harm prevention but are about oversight
- States have rights to set their regulations - but they are clueless here
- Blue states will make woke AI return if Federal pre-emption doesn’t happen
- Commerce clause in the constitution helps the US have 1 economy
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