2025-06-24 20:55:09
Welcome to the 938 newly Not Boring people who have joined us since our last essay! Join 245,548 smart, curious folks by subscribing here:
Rox is on a mission to empower every business owner to secure and grow their revenue.
The best sellers at the fastest-growing companies, like OpenAI, Ramp, and MongoDB, trust Rox to power their revenue. By combining warehouse-native architecture with swarms of AI agents that keep you smart on your top customers, Rox helps top sellers do more in less time.
When I wrote about Rox last year, I heard from a lot of you that this is the revenue tool you’ve been waiting for. No overpromises. No Salesforce implementation. Just insights and assistance. So Ishan and I decided to team up to get more Not Boring readers on Rox.
You’re probably sick of getting AI-generated inbound. I certainly am. AI is not good enough to replace salespeople, which is why Rox doesn’t do that. Instead, it gives sellers superpowers. To hear from the man himself, watch Ishan and I discuss how Rox helps companies grow here.
Want to feel why the fastest-growing companies are choosing Rox as their new system of record? Run your own Rox Agent Swarms, with no cost (and no pain) to start.
Hi friends 👋 ,
Happy Tuesday!
Not Boring is weird. A couple of weeks ago, I wrote about Modern Magnificenza, drawing on Iain McGilchrist and Italian history to argue that tech billionaires should lead a right-brain renaissance. This week, I’m teaming up with William Godfrey at Tangible to argue that capital intensity isn’t bad, as long as you finance it correctly.
These seem like two entirely different ideas, but they’re connected. We’re not going to get the world we want unless we get the nitty gritty right. To colonize Mars, we need to finance rockets. To fix the grid, we need battery-backed loans. To get really big, impactful hard tech companies, we need startups to finance themselves correctly.
And we need investors to understand that capital intensity isn’t a bad thing.
Let’s get to it.
William Godfrey x Packy McCormick
The conventional wisdom that hard tech startups are inherently more dilutive than software companies has become venture capital's most expensive Boogeyman.
While hard tech startups1, or Vertical Integrators, can require more capital than software startups, those capital needs don’t necessarily translate into more dilution for equity investors. In fact, hard tech startups that master structured finance achieve lower dilution than software companies burning equity on customer acquisition.
The capital they do spend tends to go to more productive uses; hard tech spend is more differentiating than software spend. Factories are deeper moats than increasingly expensive customer acquisition in competitive markets. And because so much capital is required, and potential winners are identifiable earlier, the leading hard tech companies actually can use capital as a moat. Not everyone can raise the mix of equity and debt required to build big things, which means less competition for those who can.
This is an argument I’ve tried to make before, and a conversation that I have with practically every LP I speak with about Not Boring Capital, and a conversation that every hard tech company has with practically every VC they speak with.
So I figured it was time to call in the big guns.
William Godfrey is the co-founder of Tangible, which helps hardware businesses structure, raise and manage asset-backed debt capital, and the co-author, along with my friend Brett Bivens, of the essay The Rise of Production Capital. After I mentioned the essay in Everything is Technology, William and I spoke and decided to try to kill this Boogeyman once and for all, with data, case studies, and financing structures that hard tech startups can use to turn their capital intensity into an advantage.
In the first half of the essay, we’re going to talk about why hard tech startups’ capital intensity isn’t necessarily a disadvantage and how using different types of financing can limit dilution and juice equity returns. To do that well, we’ll need to give you the context.
In the second, we’re going to get very specific about one type of financing: Asset-Backed Securitisation (ABS). We’ll explain what they are, how they work, the flavors they come in, and what hardware operators should be thinking about to set themselves up to issue them when the time is right. Then we’ll do some case studies, both real and illustrative, to make it all clear.
It starts out as an argument and turns into a handbook. Hopefully, having digested the former, you’ll find the latter useful.
Structured finance seems… not not boring. We hear you. But the goal of everything we talk about here isn’t simply to make cool products and watch them wither away into bankruptcy. It’s to scale them to the point at which they can make a real impact. And to do that, at some point or another, you’ll need structured finance.
As technology businesses get more complex and sophisticated, the capital that supports them needs to, as well. Capital structures need to rise to meet the opportunity.
We’ll explain how, and why getting it right can turn capital intensity into an advantage.
First, though, we need to get on the same page about what capital intensity is.
Capital Intensity is Neither Good Nor Bad
Capital intensity is the measure of how much capital (assets, equipment, infrastructure) a company needs to generate revenue.
At the extreme ends of the spectrum, a vibe coded software product might have very low capital intensity and a rocket company might have very high capital intensity.
Many companies start out looking capital-light but become capital-intense over time. Google. Amazon. Microsoft. Meta. The four largest “software” companies will spend more than $300 billion combined on CapEx this year, largely due to data center and AI investments. Apple, always a hardware company with some software, will spend less this year, but committed to spending more than $500 billion in US investments over the next four years. That is on top of another $230 combined projected R&D spend.
Nvidia aside (unlike real men, it does not have fabs), the world’s largest companies are among its most capital intensive.
SpaceX, now America’s most valuable private company at $350 billion, has also been among its most capital intensive. But, and this is the big one, its fundraising hasn’t been particularly dilutive. SpaceX has experienced less than 50% dilution since its first outside funding two decades ago, and Elon Musk still personally owns an estimated 42% of the company.
By contrast, Uber is one of Ben Thompson’s canonical examples of a Level 2 Aggregator, which “do not own their supply; however, they do incur transaction costs in bringing suppliers onto their platform.” Its founder, Travis Kalanick, owned just 8.6% of the company at IPO.
The three co-founders of another Level 2 Aggregator, Airbnb, owned a combined 30% of the business at IPO.
How is it possible that the founders of two defining Aggregators owned significantly less of their businesses after a decade than Musk owns of a company that builds (and occasionally blows up) its own rockets after two?
Certainly, SpaceX spends much more on CapEx than Uber or Airbnb. It is more capital intense.
Most investors think that capital intensity is inherently bad. It isn’t. It can be good, actually.
The question is where the capital comes from and where capital intensity lives.
SpaceX has raised over $9 billion in venture capital and growth equity over its life. Uber raised $15.9 billion before going public. It doesn’t take less money to make rockets than it does to make a ridesharing app. The difference is, as The Washington Post reported in February, as if it were a bad thing, that SpaceX has received over $22 billion from the government (not including classified defense & intelligence contracts).
SpaceX President Gwynne Shotwell said in 2013 that the company would “probably be limping along” without NASA’s support. Last year, Shotwell told an investment conference of the U.S. Government contracts, “We earned that. It’s not a bad thing to serve the U.S. government with great capability and products.”
We agree. SpaceX’s relationship with NASA is one of the most fruitful partnerships between a government and one of its companies in recent memory.
The Post quotes its owner and Blue Origin founder, Jeff Bezos, as saying in 2016: “Elon’s real superpower is getting government money.”
We agree with this one, too, with a qualification: One of Elon’s superpowers is funding his businesses with the cheapest and most appropriate capital available.
This is a superpower more hard tech founders are acquiring, and that they must acquire to win.
We have written at length about our belief that the future will be owned by companies that combine bits and atoms, software and hardware to build better, cheaper, and/or faster products than incumbents. To that belief, we would add money. Bits + Atoms + Dollars.
The future belongs to companies that combine the world's best engineers with the world's best financial engineers.
During the hard tech renaissance, smart technical founders have realized that they must also be smart about the way they capitalize their businesses, and have become more aware of the myriad financing options available to them. A few examples include:
Each hard tech company will have a different menu of options available to them depending on what they do and how far along they are. Most founders and investors are familiar with, and take advantage, of most of the appropriate ones.
You would be arrested for dereliction as a defense tech founder, for example, for not pursuing DOD contracts, or as an energy founder for not applying for the appropriate DOE loans. Any CFO with a pulse might try to mix in a little corporate debt on the back of a venture fundraising.
Asset-backed financing, however, perhaps because it can be the most sophisticated and bespoke, is deeply underutilized and underappreciated.
(Plug: AI should help make sense of all of this complexity for you. We built Tangible because watching billion-dollar structures built and managed in hand-crafted Excels was giving us nightmares. Instead of lending against your equity story, Tangible helps you prepare your company story and access lenders, who finance against the actual cash-generating assets you've deployed.)
As hard tech and venture become more aware that you shouldn’t fund everything with equity, almost everyone now realizes that equity should fund R&D and debt should fund scale.
That is a step in the right direction. But all debt is not created equal.
The two overarching types of debt instruments are corporate debt and asset-backed financing.
Corporate debt gets priced on the strength of your company's balance sheet. If you're a startup, that's deep junk bond territory, because lenders face full enterprise risk plus bankruptcy risk, which is safely assumed to be a zero recovery scenario. Asset-backed debt gets primarily priced on the specific collateral and cash flows (although for very early stage companies there is some degree of corporate risk that is also accounted for but to a lesser extent than corporate debt). Those same charging stations price lower because lenders have first lien on hard assets plus dedicated payment streams that never touch your corporate balance sheet.
When most startups we hear about raise debt, it’s corporate debt in one form or another.
At Breather, we raised venture debt, which ended up being good for neither us nor our lender.
Debt is the promise of paying back the principal with interest in a timely manner, unlike equity, which has no formal obligation to repay. Venture debt attempts to blend these two worlds in a way that sometimes falls short of the mark for helping a hardware company to scale. Debt investors, even “venture” debt investors, primarily care about getting repaid their capital on time and less about your venture story. Venture debt can be useful, but it can also be dangerous.
Uber got big enough that it didn’t have to raise venture debt but also didn’t only have to rely on its $15.9 billion in venture capital. It raised $1.6 billion in convertible debt from Goldman Sachs in 2015, followed by a $1.15 billion leveraged loan in 2016.
This institutional debt was cheaper than equity but more expensive than asset-backed alternatives since lenders were underwriting the company's overall business risk rather than specific collateral. When we talk about “cheaper” or “more expensive,” we mean the cost of capital. Interest rates on debt are typically lower than the expected returns equity investors demand.
The reason that Uber raised more expensive corporate debt instead of cheaper asset-backed alternatives is simple: ride-sharing platforms are asset-light. They don’t have the assets to use as collateral for their borrowing.
Hence the meme: “Uber owns no cars. Airbnb owns no hotels. [Company X] owns no [Y]. This is the new economy.”
But owning things can be good, actually, if capital intense. The question here is where the capital intensity lives.
For smart hard tech companies, capital intensity doesn't live on their balance sheet, where it can weigh them down. It lives in off-balance sheet structures that actually multiply their capital efficiency, and even generate revenue through servicing fees and yield, while isolating risk.
Asset-backed financing is all about stripping out assets from businesses and packaging them up as a product that the debt capital markets will like.
If you can pull it off, asset-backed financing can be the difference between scale and insolvency. But adding it into the mix can be a tricky transition for startups to make, because what debt capital markets like is almost diametrically opposed to what venture capital likes.
Venture capitalists expect founders to sell them the dream, the bigger and riskier the better. Lenders expect borrowers to show them the numbers, the more precise and predictable the better.
To please the former, too many venture-backed hard tech companies high on equity funding have spent their money in ways that make the latter shudder.
Planning ahead can fix this. For hard tech companies, VC and debt each represent one act in the story of a successful business.
Every startup goes through a similar Act I: The Engineering.
In Act I, a startup needs to prove that it can actually do what it thinks it can do. Design the hardware. Prove the technology works. Find product-market fit. Show unit economics. Get to repeatability.
This is pure equity territory. Higher risk, higher returns. You're asking investors to underwrite technical risk, market risk, execution risk. You burn cash to prove that your thing works and people want it. VCs are comfortable here because this feels like every other startup.
Act II: The Financial Engineering is where fortunes are lost and won… and where many VCs check out, because Act II doesn’t look like “tech” anymore.
Act II is about turning your deployed technology into a financial instrument that institutional capital wants to own. You're no longer asking investors to underwrite your startup risk. You're asking them to underwrite the cash flows your technology generates.
In Tesla’s Act II, it became one of America’s largest consumer lenders. In SpaceX’s Act II, it became one of the government’s largest contractors, and could borrow against the US Government’s well-accepted ability to pay those contracts.
Act II changes everything a startup does, even how it thinks about and presents itself.
In Act I, you compete with other startups for expensive equity capital. In Act II, you compete with asset-backed securities and corporate bonds for cheap institutional capital.
In Act I, every dollar of growth requires a dollar of equity. In Act II, every dollar of equity can support multiple dollars of debt-financed growth.
In Act I, you're a technology company that happens to make money. In Act II, you're a financial products company that happens to use technology.
Most capital-intensive companies die in the transition. This is the Valley of Death. They raise equity to prove the technology works, then keep raising equity to scale deployment. They never learn to package their deployed assets into financial products.
Think solar companies that install panels but never securitize the cash flows. EV charging companies that build networks but never turn them into infrastructure bonds. Manufacturing companies that prove unit economics but never create equipment financing programs.
One big challenge to consider is that many hard tech (or, specifically, deep tech) companies build first-of-a-kind (FOAK) products that may be hard to securitize. Venture loves unstandardized and esoteric; credit loves standardized and legible. To be clear: the world needs more of this kind of innovation! But recognize that it makes accessing credit more difficult, and may contribute to capital intensity’s bad reputation. There is a tightrope to walk.
Companies that fail to transition to Act II remain addicted to expensive equity while their competitors graduate to scalable cheaper debt deployments.
At their own peril, they ignore the age-old lesson:
All else equal over time, cheapest cost of capital wins.
Which means that if you’re building a hard tech startup, and you want to turn it into a big hard tech company, you need to understand asset-backed financing.
The simplest way to understand an asset-backed facility is that it’s like a credit card that you can buy one thing with.
Your Amex can buy anything: dinner, flights, random stuff on Amazon. An ABS is a credit card that can only buy EV charging stations. Or solar panels. Or whatever specific asset you're securitizing.
The credit card company (investors) fronts the money, you buy the assets, and the monthly payments from those assets pay down the credit card balance.
Wall Street thrives on jargon and acronyms, but strip away both, and ABS is simple: you're creating a legal entity that owns specific assets and cash flows, separate from your operating company.
If your startup fails, the assets and their income streams live on. Your job as a hard tech founder is to make these streams reliable and enduring, even in the event of the death of your startup. That the asset might outlive its creator sums up the difference in approaches.
Viewed in this light, the job in Act I is to prove that you can build the crazy thing you say you’re going to build, and that that thing can generate relatively predictable cash flows.
Once you begin generating those cash flows, you can sell a small package of them to investors, and scale up the size of the package as you prove that you’re good for the money and add more assets. Optimally, you’d set up multiple facilities to reflect differences in geography, restraints, and models, and then grow the assets in each as you mature instead of writing new docs each time you need to raise more capital.
This is how successful capital-intensive companies move the capital intensity off their balance sheets: they originate assets, prove the model works, then package and sell those assets to institutional investors backed by steady, predictable returns.
Tesla doesn't keep every car loan on its books; it packages them into a portfolio of loans and sells this portfolio. Solar companies don't hold 25-year power purchase agreements; they securitize them and recycle the capital. Securitization means selling your future cash flows for cash today, at an appropriate discount.
The company keeps the profitable origination business and capital providers get the steady cash flows.
This is financial engineering 101, but it's treated like black magic in venture. Which is fair, actually, because backing companies with tangible assets is not what venture has done for decades. To be even more fair, ABS can be intentionally complex.
An ABS is basically a massive algorithm for governing this new off balance sheet structure of yours. Every payment that comes in gets sorted, allocated, and distributed according to hundreds of rules. Which investors get paid first? How much goes to reserves? Who gets paid when in the waterfall? What happens if Station #247 stops paying? What covenants stop you from having one customer that gets too big as a % of your originations?
When the risk of misunderstanding that algorithm is the seizure of your business’ productive assets, it’s understandable that some companies and their investors go with the more expensive equity; at least the equity doesn’t come with bond covenants.
Worse, this algorithm usually runs on... spreadsheets. Thousands of them. Excel models so complex they need their own user manuals. One misplaced formula and your entire deal structure falls apart.
Every deal comes with credit agreements that are legitimately thicker than a phone book, full of covenants that read like the legal version of the calming words hypnotists say to knock you out and triggers that sound like nuclear launch codes.
Take this sample covenant: "If the 3-month rolling average of Cumulative Net Loss Rate exceeds 2.50% or if the Payment Rate falls below 15.0% for any two consecutive collection periods, the Revolving Period shall terminate immediately."
Translation: If too many charging stations break or customers stop paying, the growth phase ends and you start paying investors back.
Of course, to translate that, you would have to know that most ABS structures have two phases that determine whether you keep "buying more stuff" (Revolving Period) or start "paying down the balance” (Amortization Period).
During the Revolving Period, you can keep adding new assets to the pool. Install 100 charging stations, securitize them, use that money to install 200 more stations, add those to the same securitization. Rinse, repeat. The investors' "credit line" keeps growing as long as the assets perform well. This is the growth period.
During the Amortization Period, the music stops. No more new assets. All cash flows from existing assets go straight to paying down investor principal. This is usually triggered by time or performance metrics falling below certain thresholds. Putting a deal into an amortization phase more quickly is a risk mitigation feature that can help limit losses.
Think of it like a construction loan that converts to a mortgage. First you build (revolving), then you pay it off (amortizing). Mature companies have multiple facilities, some of which are Revolving and some of which are paying down at any given time.
That’s just one example of the many terms you’ll have to get to know. Wall Street dines on opacity.
There’s good news for those intrepid enough to wade through it all, though: the more complex the structure, the higher the barriers to entry. The algorithm gets more sophisticated, the documentation gets thicker, and your moat gets deeper.
It’s worth learning the basics (and then hiring or working with professionals).
So you want to securitize your assets?
Long before that day comes, you need to prepare the company to eventually be in a position to sell to ABS investors. There are a few things you should plan for from the early days of the business (or look for in a hard tech business, if you’re an investor):
Clear offtake agreements: Someone committed to buying your output
Standardizable assets: Repeatable deployments that can be packaged
Predictable cash flows: Instalment sales, subscriptions, leases, usage-based fees
Collateral value: Market value of the assets backing the debt
Reporting: Solid operations and processes to capture every beat
Credit Enhancements: Tools you can make use of to reduce the risk of non payment of interest or principal, for example third-party guarantees (usually from what the market perceives to be credit worthy counterparties with strong credit ratings)
Seed Portfolio: A showcase of assets that you’ve funded yourself to prove that you know how to do your core business
Often, these are things you’ll want to think about anyway. Clear offtake agreements means there will be demand for what you’re supplying. Repeatable deployments makes operations easier and allow you to capture the benefits of scaled manufacturing. Every investor, VC or credit, likes predictable cash flows; that’s why SaaS won. And your robot is more valuable if it can work in any warehouse you put it in or can be sold in the open market for cash; maybe the massive battery you put in the robot is even easy to take out, and sell to someone else. The design choice to have one screw or thirty being the barrier can have a real effect on your fundability. Preparing for asset-backed financing is just another reason to dot these i’s and cross these t’s.
Once you have hardware deployed, or a plan to, and generating cash flows, or contracted to, financing becomes a multi-dimensional puzzle. Most founders think there's one "right" way to finance hardware assets. Actually, you're assembling puzzle pieces across multiple dimensions - and when they fit together perfectly, you can unlock dramatically cheaper capital.
Here's how the best hardware companies think about it:
Originate Assets: Deploy hardware, sign customer contracts
Pool & Package: Group similar assets with predictable cash flows
Credit Enhancement: Add guarantees, cash reserves, insurance, overcollateralization
Solve the Puzzle: Match all the pieces to create the optimal structure
Recycle Capital: Use proceeds to deploy more assets
Optimize Over Time: Use track record to access better puzzle pieces
The magic happens in Step 4, where you and your team solve the puzzle. There is no universal “best option.” This process is all about finding the combination where all your puzzle pieces fit together seamlessly, which the credit world calls “structuring.”
There are six big things (and a million little ones) to consider when determining how to securitize your assets.
Physical Characteristics: Solar panels with 25-year warranties fit different financing structures than a fleet of esoteric robots just learning to walk. Durability, technological obsolescence risk, resale value, how easy they are to move and maintenance requirements all shape your options.
Cash Flow Patterns: Predictable monthly payments unlock different capital than seasonal usage spikes. Revenue timing, contract lengths, contracted floors, and payment reliability determine which investors will be interested.
Deployment Model: Distributed assets (thousands of charging stations) need different structures than centralized ones (single large solar farm). Geographic concentration affects risk and operational complexity.
Payment Preferences: Monthly subscriptions, usage-based fees, upfront purchases, or long-term contracts. Your financing structure needs to match how customers actually want to pay and can often mean they’ll buy more from you.
Credit Profile: Large companies with strong perceived credit worthiness, such as a utility with a ‘AAA’ rating enables different financing than startups paying monthly. Customer creditworthiness directly impacts not just your borrowing costs but also your ability to access this type of capital. And seeing as you’re now becoming a lender, it’s something you should really care about as well.
Contract Terms: Take-or-pay contracts, termination rights, escalation clauses, early repayment penalties. The specific contract language, who drafted it, all determines cash flow predictability and investor comfort.
Track Record: Early-stage companies pay premium rates until they prove their model. Each successful deployment expands your financing options.
Performance Data: A minimum of 12-18 months of operating history is typically the threshold where institutional investors start to get comfortable. Before that, you're likely to have more limited choices.
Management Team: Investors finance management teams as much as assets. Prior experience with similar deployments matters enormously. Investors want to hear their mother tongue of ABS from the other side of the table.
Regulatory Landscape: Energy sector regulations, transportation rules, tax incentives. Some sectors have specific financing programs or restrictions that shape your options.
Macro Environment: Rising rates favor floating-rate structures, falling rates favor fixed (from the perspective of the lender). The macro environment affects which investors are active, which products have delays in production, which will have tariffs, and any extra political goodwill around asset classes like data centers or robotics.
Competitive Dynamics: How many similar deals are competing for the same capital? Market saturation affects pricing and terms.
Pension funds want predictable cash flows with minimal risk. Hedge funds or private credit funds want higher returns and can accept complexity, newness or novelty. Matching risk profiles is crucial.
Return Requirements: Different investors have different return hurdles. Senior capital accepts lower returns for safety. Specialty capital demands higher returns for risk.
Investment Mandates: Some investors can only buy certain structures (ABS vs. project finance) or asset classes (energy vs. transportation). Understanding mandates helps target the right capital.
Cash Flow Structures:
Pass-Through: Everyone owns everything proportionally
Pay-Through/Sequential: Waterfall with senior/junior tranches that respects the hierarchy of creditors in liquidation
Hybrid: Combines both approaches for flexibility
Financing Vehicles:
Asset-Backed Securitization: Regulated, standardized, public market access
Project Finance: Ring-fenced projects with dedicated cash flows
Equipment Finance/Leasing: Traditional lending secured by physical assets
Master Trusts: Revolving structures for repeatable deployments
Warehouse Facilities: Credit lines before larger securitizations
And much much more!
A few examples will demonstrate how fitting your puzzle pieces might work in practice, and show that this part of the work isn’t overwhelmingly complex.
Assets: Predictable locations, long-term utility contracts
Customers: Investment-grade utilities with take-or-pay agreements
Company: 3 years operating history, experienced management
Market: Supportive regulatory environment, stable rates
Solution: Pay-through ABS with senior/junior tranches
Assets: New technology, software-dependent, limited resale value
Customers: Mix of startups and established companies, monthly payments
Company: 6 months operating data, first-time founders
Market: High interest rates, limited comparable deals
Solution: Equipment finance with specialty lender, graduate to master trust
Assets: Single large installation, 25-year power purchase agreement
Customers: State utility with AA credit rating
Company: Experienced developer, multiple prior projects
Market: Tax incentives available, infrastructure funds active
Solution: Project finance with infrastructure debt fund
There is a fair amount of complexity to think through here, which can seem scary when unfamiliar but which is both manageable and learnable. People much dumber than you issue ABS all the time. It’s not… rocket science.
But it can help turn rocket science into a rocket business, or any small-scale project into a large one. For those willing to piece together the puzzle, there are significant, potentially company-defining advantages.
Remember the lesson: all else equal, cheapest cost of capital wins.
The first advantage is a crucial one: ABS is cheaper than corporate debt.
In the US public markets, asset-backed ABS almost always price inside (at lower spreads and yields than) unsecured corporate bonds of comparable rating and tenor. ABS spreads were 28–36 basis points (bps) tighter and all-in yields roughly 50–60 bps lower than unsecured IG corporates over two recent period-end snapshots.
There are a number of structural reasons for this:
Structural credit enhancement: Subordination, excess spread, over-collateralisation and reserve accounts mean even AAA ABS can withstand large collateral losses. Investors require less spread to compensate for risk.
Shorter interest-rate exposure: Most ABS amortise quickly (2-4 y weighted-average life), so duration risk, and the spread needed to bear it, is lower.
Collateralized vs. unsecured: ABS investors have a direct claim on ringfenced specific cash-flow pools; corporate bondholders rely on the issuer’s general credit and pool of assets in case of bankruptcy.
Ratings mix: In part because of the reasons listed above, AAA/AA tranches dominate the ABS index, whereas the IG corporate index skews A/BBB. Tighter spreads partly reflect their higher ratings.
Less important day-to-day, but existentially important when it counts, a second advantage of ABS is that it is bankruptcy remote. This works two ways.
First, it means that if the parent company goes bankrupt, its creditors can’t reach into the Special Purpose Vehicle (SPV) set up to house the assets and their cash flows. ABS investors will continue to receive the cash flows as long as the assets generate them. This contributes to ABS’ cheaper cost of capital.
Second, it means that, once in an SPV, if the assets underperform, there is generally no recourse to the originator (although for startups, a corporate guarantee may be required). A wipe-out in the SPV can’t force the parent into Chapter 11. It can’t bankrupt the company. It can still hurt earnings. The parent company typically holds the equity piece, which is wiped out, and must often repurchase bad collateral. But the losses are bounded. With unsecured corporate debt, on the other hand, creditors can go after everything and push the company into bankruptcy.
The third advantage of ABS may be the most strategically critical: ABS can turn capital intensity into a force multiplier, giving you the ability to multiply your equity dollars.
If you're able to offload your capital intensity to someone who will buy it from you, you are at worst as good as any other technology company. You have the balance sheet of an asset-light business with the moats of a (well-run) capital intensive one.
Most pure-software companies are fighting in hyper-competitive markets with massive marketing spend. Hardware companies that crack securitization get natural monopolies with lower acquisition costs and potential software company valuations.
Plus, because small-scale success unlocks larger facilities, ABS allows companies to unlock more capital to build more assets without raising additional equity.
The companies that figure this out first will have long lasting competitive advantages - they'll be able to deploy faster, cheaper, and at scale while competitors are still trying to raise equity for each new deployment.
Perhaps most relevant to dispelling the belief that hard tech is too capital intensive to make sense for most VCs, getting your financing right can dramatically lower your dilution.
A toy model will clarify what we mean.
Let's model this with Packy's robot company, which sells warehouse robots on subscription, lowering the CAPEX barrier to entry for our customers and enabling larger deployments, before locking them in with the recurring fees.
There are two ways that we can finance this business: with pure equity, or by combining equity and asset-backed financing. The latter is more capital efficient than the other and results in a lower blended cost of financing over time.
This is a toy model, but the takeaway is clear: more robots, more revenue, less dilution.
With an initial $1M seed portfolio, Company B unlocks a $30M facility, which funds more than 3x the number of robots as Company A with less equity, and therefore, less dilution. The subscription payments from deployed robots create a self-reinforcing cycle where each new deployment strengthens your ability to access more capital from the facility.
In Scenario B, you keep 6% more equity while deploying more capital to finance more assets. Scale this across multiple rounds, and the difference becomes massive.
The traditional equity financing looks something like this:
Deploy $1 of capital → Generate revenue → Retain all profits
Capital gets "locked up" in assets until payback is reached
Efficiency measured as: Revenue ÷ Total Capital Deployed
The structured finance scenario, the money multiplies and the business becomes more efficient:
Deploy $1 of capital → Generate revenue → Recycle 80% (your advance rate) immediately → Deploy again
Same $1 of equity capital supports multiple asset deployments over time
Efficiency measured as: Total Revenue Generated ÷ Equity Capital Required
Both models achieve the same 5x revenue-to-capex ratio, but the structured approach is more capital efficient because of three factors:
Capital Velocity: Your equity dollar "turns" faster - instead of being locked in one robot, it can support the deployment of multiple robots over time.
Leverage Effect: Each equity dollar leverages debt capital (the AB facility) to deploy more total assets than equity alone could support.
Continuous Deployment: Capital recycling enables continuous scaling and upsizing, although you may want to raise equity to scale even faster.
With ABS, in other words, not only is each dollar “cheaper,” it’s also more productive.
There are, of course, trade-offs, the most important of which is that in the ABS scenario, you accept X% lower margins per robot (i.e. 70% → 62%) in exchange for 4x deployment scale with the same equity base. The "efficiency" comes from maximizing the productivity of your scarce resource (equity capital), not necessarily maximizing the margin on each individual transaction.
It's about making your equity capital work harder and faster, not just making it work more profitably on a per-unit basis.
In short, capital intensive businesses can still be capital efficient, and often even more so when done right.
And no startup has done it better than Crusoe Energy.
“The guy at the heart of the Stargate build in Abilene is Chase Lochmiller,” said Bloomberg’s Emily Chang, walking onto the construction site. “He’s the founder of Crusoe, the little-known data center startup overseeing this massive project.”
Crusoe is a seven-year-old startup that started out using the gas that would have otherwise been flared off into the atmosphere to mine bitcoin. As the AI boom kicked off, Chase and his co-founder Cully Cavness realized that the same idea would work for AI data centers. Power was a key input, and they could get it cheaply, and latency didn’t matter as much, so they could put the data centers wherever the gas happened to be.
Fast forward, and the company was last valued at $2.8 billion in December 2024 and is now managing the largest AI data center buildout in history, the $500 billion Stargate project, having raised just $1.59 billion in equity from the likes of Founders Fund, Bain Capital Ventures, and Valor Equity Partners.
“Just” is a weird word to put next to $1.59 billion, but there are very few startups more capital intensive than one that builds its own data centers and power generation and buys tens of thousands of GPUs. To fund all of that, Crusoe turned to asset-backed financing.
In August 2023, Chase went on the ACQ2 podcast with Ben and David from Acquired, and laid out how the business financed itself in a way that echoes a lot of the points we have been making. You can listen to the section starting at 1:13:42 and ending around 1:22:26:
We will include a big chunk of that conversation here, because it’s so relevant to everything we’ve written, and bolded for emphasis:
Chase: Obviously our business is not just a pure enterprise SaaS business, right? It’s pretty far from it. We have quite a bit of CapEx, we build technology, we build software solutions, but we also have physical infrastructure and big pieces of heavy machinery that are involved in the overall process… We’ve certainly done a lot of equity, but on the CapEx side, right, we’ve done a bunch of very interesting things around how do we actually scale the business without just plowing equity dollars into CapEx, because at the end of the day that’s not really what we want to do.
Ben: For listeners who don’t come from the finance side, why is it a bad idea to just finance all the CapEx with equity and when in a business’ life cycle can you explore other options? What level of predictability do you need?
Chase: …In our case, we really didn’t want to finance big physical assets with equity dollars because there is collateral there at the end of the day versus…
David: It’s like a mortgage versus venture investment. These are different things.
Chase: Exactly. Most people don’t buy their house with 100% cash because they can get a low-interest mortgage and the bank’s happy to make that loan because there’s existing collateral, if you stop making your payments they can just take over your house and liquidate it for more than the outstanding loan that they have with you. In our case, we have large pieces of power generation equipment that we’ve been able to finance with asset-backed financing. There was one group that we have a large facility with called Generate, there’s another group that we did something with called Northbase, and another group called Spark Fund, all on the electrical and asset-backed financing for electrical systems and power generation equipment.
What’s cool about that is the way those are structured is they are asset-backed, which means it isn’t debt that sort of defaults up to the parent company necessarily, like if we stop paying they’d come and they’d take the generator and they’d go liquidate it on the secondary market, they’d get made whole that way, and it’s not an incremental liability for Crusoe the company. Now, that’s our plan. You know, if my debt holders are listening to the show right now, we entirely intend to continue to make all of our payments.
Ben: But it’s useful for listeners to understand how those sorts of things work and how it connects to the parent company.
David: And this is how most of the non-tech business world works. Like if you’re Procter & Gamble or something, you’re not financing your assembly lines with equity.
Chase: Yup, yup. We essentially have four big pieces of CapEx: we have generators and electrical infrastructure supporting the power generation side, we have GPUs and associated networking equipment and servers, we have bitcoin mining hardware, so ASICS that are used to run the SHA-256D hashing algorithm, and then we have data center infrastructure, the actual physical boxes or buildings that we build to house the actual equipment.
Our belief is that the best way to structure financing is to have each of those individually with different asset-backed loan facilities, and then we use equity capital to continue to grow, invest in technology, hire the team, and also come up with our piece of the loan essentially. Where it’s like you typically don’t get 100% LTV on something, just like when you buy a house it’s typically not a 0% down payment, you typically put in whatever 20-30% as a down payment on a house, we do a similar thing with generators or GPUs with these asset-backed financing facilities.
David: And I would imagine what’s cool is that there are pools of capital out there that are interested in the risk and reward profiles of each of those different things.
Chase: Exactly. We did a project financing facility with a really clever and creative credit fund called Upper 90, and this was actually focused on our bitcoin mining business, and it had equity-like constructs to it but it had debt-like constructs to it, and it was actually one of the keys to helping us get off the ground was through this facility, and it was cool to see investors like that that were really willing to think deep and creatively about what our actual revenue stream was independent of where we were at in terms of stage of company. Because we did that around our Series A, it ended up being a total of $55M that we deployed through these facilities that really enabled us to kind of grow and scale that digital currency mining business in a way that didn’t dramatically dilute our equity capital.
David: Right, otherwise you would have been adding on another $55M to your Series A, and that would have sucked.
Chase: Exactly. There are just creative financing solutions that, people by default think that they need to go raise the next series of funding, and I don’t think that’s the case, and I think there are a lot of ways founders can end up owning a larger percentage of the company by finding the right investor for the right component of their overall capital stack and capital structure.
We don’t have a time machine, so there’s no way we could have paid him to say all of that.
When I had Chase and Cully on Not Boring Founders, I said, “It’s built what I think is one of the greatest cathedrals to capitalism in startup land.”
I meant that they took a problem (flared gas) and turned it into a solution (cheap energy for compute), economically, and that they financed the whole thing brilliantly. To recap:
In 2019, when Founders Fund led their Seed Round, Upper90 came in with a debt facility that same year.
By 2021, they had 86 data centers and proved the model with a $40M debt round.
In the 2022 Series C, they raised $350M in equity from G2 Venture Partners PLUS $155M in credit facilities from three specialist lenders (SVB, Sparkfund, Generate).
By 2023, as AI boomed, they realized they could use GPUs as collateral, and raised $200 million in asset-backed financing from Upper90, specifically for GPU purchases.
In 2024, they raised $600 million led by Founders Fund at a $2.8B valuation. NVIDIA participated.
This year, in 2025, they raised $225M Upper90 syndicated facility with pension funds and insurance companies (March), $11.6B joint venture development capital for Texas data center expansion as part of Stargate with Blue Owl (May), and $750M in infrastructure debt from Brookfield.
When trillion dollar asset managers start lending to you, you've graduated from startup to infrastructure company.
There are a few key lessons to learn from Crusoe:
Originate Early and Often: Crusoe "helps businesses with predictable revenue and collateral." Crusoe had both. Hard assets that credit investors could touch, feel, and repossess if needed.
Relationship-Driven Debt Compounds: Upper90's relationship "started in 2019 with equipment financing" and evolved through multiple growth stages. Each successful facility made the next one easier and larger.
Think in Instruments, Not Just "Debt vs. Equity": Crusoe used equipment financing, asset-backed lending, infrastructure debt, development joint ventures, and syndicated facilities. Each serves a specific purpose at a specific point in time.
Big Counterparties = Big Money: When NVIDIA becomes an equity investor and Oracle becomes your anchor tenant, credit investors unlock pools of capital that make venture look like pocket change.
If you do all of those things right, and solve all of the engineering challenges required to do things like building data centers powered by stranded energy in the middle of nowhere, you can build something really big, really fast.
We’ve thrown a lot at you. We don’t expect you to absorb it all in one setting. Save it, print it out, reference it when you’re thinking about how to finance your business, and then, if you think that asset-based financing makes sense, hire professionals. Feel free to reach out to Will at [email protected] if you want to get pointed in the right direction.
Financing your business the right way might be the difference between life and death, or at least between owning a lot of your company at IPO versus owning a little.
Any business worth building will be capital intensive, either at the beginning or over time.
Software companies will typically need much less money upfront, because software is not inherently expensive to build. You can even vibe code it now. But the thing that makes it easier to build means that they will have to spend more money competing in the competitive Red Queen’s Race, on things like customer acquisition, that don’t contribute to a lasting moat. Remember how many 30% off Ubers you took when they were trying to win the market? If they get really big, like Facebook, Google, and Microsoft, they will need to spend tens of billions to protect their throne and capture the next platform shift or risk destruction.
Deep tech companies need more equity capital upfront, to build a physical thing before they’ve proven that they can, which scares investors. But if they make it through, they face less competition over time because of the inherent difficulty (and capital intensity) of what they’re building. Once they’ve reached the promised land, many hard tech companies can (and should) turn to asset-based financing to fund the deployment of assets with predictable cash flows, building up bigger leads, and digging deeper moats, in the process.
For these companies, properly financing the business can mean less dilution and more speed. Our hypothetical robot company was able to put 3x the robots into the field, faster, with two-thirds the dilution. In infrastructure markets, speed wins. Premium locations get taken. Network effects kick in. Economies of scale create cost advantages. Regulatory favor goes to market leaders. Investors pile into the winner, and cut off competitors’ financial oxygen.
This is why companies like Base Power Company care so much about speed: there are only so many residential battery early adopters, and they’re only going to put one battery on their home. Of course, they are thinking about asset-backed financing. In my first Deep Dive on the company, I wrote:
For now, Base is financing batteries off of its own balance sheet. In the months ahead, it needs to grow the portfolio and prove out the economics of its batteries so that it can secure asset-backed loans to fuel its growth. Building a portfolio that appeals to lenders means that Base can unlock a lower cost of capital, which means more batteries and more profits, and ultimately even lower costs of capital. The moat widens.
As these companies build up a capital markets track record, they can unlock larger facilities and cheaper financing costs, compounding their advantage. Financing itself becomes a moat.
The biggest challenges of our generation cannot be solved with software alone. Solving them requires CapEx, and CapEx isn’t free.
But capital intensity isn’t a bad thing. It’s another challenge to be solved, and another product to sell. And those who solve it can build more capital-efficient businesses than their competitors, which is what counts. There is no shortage of money in the world for companies that generate predictable cash flows solving huge problems. Private credit assets under management is expected to double to $3 trillion by 2028, dwarfing venture capital by nearly an order of magnitude, and turbocharging it.
The trick is structuring your cash flows in ways that appeal to investors. Which can be complex and difficult, but that’s what makes it valuable.
Don’t be scared. Capital intensity isn’t bad, as long as you finance it right.
Thanks to William for co-writing this essay and contributing all the smart stuff, to Brett Bivens for introducing us, to the Tangible team for feedback, and to Claude for editing.
That’s all for today. We’ll be back in your inbox with the Weekly Dose on Friday. In the meantime, set your sellers up with agent swarm on Rox. We’ll
Thanks for reading,
Packy
We are going to use hard tech startups instead of Vertical Integrators throughout, because the lessons apply to any company building hardware that generates cash flows, not just the fully vertically integrated ones competing directly with incumbents.
2025-06-20 20:35:57
Hi friends 👋 ,
Happy Friday, welcome back to our 149th Weekly Dose of Optimism. I am back from what was the best week of my life: I got married to my beautiful wife, Sienna, in Pietrasanta, Italy surrounded by 110 of our closest family and friends. This specific Tuscan region is notable for its combination of both mountains and beaches and seemed pretty undiscovered by the hoards of tourists that generally visit Italy during the early summer. The wedding itself, largely planned by Sienna, was a dream: our moms officiated, Sienna looked gorgeous, I cried, we had two pasta courses, it was so hot but no one seemed to notice, and the wine and dancing flowed well into the night. I even had the Not Boring guy give a Best Man speech (he crushed.) Best night of my life and it’s not even close. It could just be the post-wedding glow, but I am feeling more in love with life and more optimistic than I ever have before.
And the celebrations continue! Today is our dad’s birthday. We wouldn’t be doing what we do if he didn’t give us the love of business, love for each other, opportunity, and tough love that he did. Happy birthday, Pops!
Let’s get to it.
Today’s Weekly Dose is brought to you by… INBOUND
Some companies improve on existing markets. Others create entirely new ones. At INBOUND 2025 in San Francisco, you'll connect with visionaries like Dario Amodei, Victor Riparbelli, and Dharmesh Shah who are pioneering technology-enabled market creation at unprecedented speed.
The agenda is now live! Secure your ticket now to start planning an INBOUND experience that fits your goals and growth plans. Don’t miss this chance to hear from industry icons and connect with decision-makers seeking strategic partnerships and growth opportunities.
INBOUND delivers value you can't get anywhere else — direct access to the founders and thinkers who are redefining industries, practical frameworks you can implement today, and connections that translate to real business opportunities.
Not Boring readers get 10% off their INBOUND General Admission ticket with code NOTBORING10 (Valid thru 7/31).
(1) FDA Approves Powerful Twice-Yearly Treatment to Prevent HIV
Joseph Walker and Peter Loftus for The Wally Street Journal
The Food and Drug Administration on Wednesday approved a powerful new prevention drug for HIV called Yeztugo that promises to keep most people virus-free with two shots a year.
Hope you’re PrEPed for some good news: the FDA just approved a new HIV prevention drug that’s about as close to a sure thing as science gets. Gilead’s Yeztugo, a twice-yearly injectable PrEP drug demonstrated 99.9% effectiveness in trials making it the longest-acting HIV prevention option available. It requires only two shots a year, which solves two of HIV treatment’s longest standing barriers, adherence and accessibility. The treatment is a meaningful advance in a decades-long effort to stop the virus without a vaccine (I don’t blame the community for mistrust here!)
With projected sales of $1.6 billion by 2028, Yeztugo strengthens Gilead’s leadership in the space and puts pressure on rivals like GSK’s Apretude which requires four shots per year. It also signals how far the PrEP strategy (prevention before exposure) has come since Gilead introduced it back in 2012. Pretty amazing how far HIV treatment has come in just our lifetime.
From Lilly
Verve is developing a pipeline of gene editing medicines designed to address the drivers of atherosclerotic cardiovascular disease (ASCVD) through treatments that may only need to be given once in a lifetime. Verve's lead program (VERVE-102) is a potential first-in-class in vivo gene editing medicine targeting PCSK9, a gene linked to cholesterol levels and cardiovascular health.
Lilly is acquiring Verve Therapeutics for up to $1.3B to advance a one-time gene editing treatment that could permanently lower LDL cholesterol by ~50%. Verve’s lead program, VERVE-102, shuts down the PCSK9 gene, potentially replacing daily statins and injectables with a single gene editing dose.
Cardiovascular disease is the world’s top killer and costs the U.S. over $400B annually; about 94M Americans have high cholesterol, and over 30M could benefit from PCSK9-targeted therapies. But long-term adherence is low, and current treatments are expensive. Verve’s single dose treatment is simpler, lasting, and potentially more cost-effective.
The timing is strategic. Just weeks ago, the HHS announced reforms to reduce the cost of manufacturing gene therapies and expand access through Medicare’s new Cell & Gene Therapy Access Model. That clears a major commercial hurdle, and Lilly is wasting no time to take advantage of the scientific and regulatory tailwinds in the massive market of cardiovascular health.
(3) Waymo has set its robotaxi sights on NYC
Kirsten Korosec for TechCrunch
New York, we're coming back to the Big Apple next month! We want to serve New Yorkers in the future, and we’re working towards that goal. - Waymo on X
Waymo may be coming to NYC soon!
The company just applied to test its self-driving Jaguar I-Pace vehicles in Manhattan with a human behind the wheel, as required by New York’s restrictive AV laws. The state mandates a hand on the wheel, $5M insurance, and extensive operator training, making true driverless service currently illegal. Waymo’s lobbying to change that and calling in the big guns like MADD NY and the National Federation of the Blind. When Moms get involved, you better watch out. The whole approach seems very Uber/Tusk early 2010s.
Waymo previously mapped NYC in 2021 but never ran autonomous mode. Now, it's betting that regulators are more open and that its track record matters. It already runs over 250,000 fully autonomous rides per week in Phoenix, San Francisco, Los Angeles, and Austin.
NYC is a different beast: dense, chaotic, and politically complicated. But as Frankie Blue Eyes once noted about New York, “If Waymo can make it here, they can make it anywhere.”
(4) US Senate passes stablecoin bill in milestone for crypto industry
Hannah Lang for Reuters
The U.S. Senate on Tuesday passed a bill to create a regulatory framework for U.S.-dollar-pegged cryptocurrency tokens known as stablecoins, in a watershed moment for the digital asset industry.
The Senate passed the GENIUS Act, the first major U.S. bill regulating stablecoins, crypto tokens pegged to the dollar. It requires stablecoins to be backed 1:1 by liquid assets like cash or T-bills and mandates monthly reserve disclosures. The bill passed 68–30 with bipartisan support but still needs to clear the House before it can land on Trump’s desk, where the very pro-crypto President is likely to sign in.
This bill is particularly notable for a couple of reasons. First, the industry has been asking for clear guidelines and regulation for well over a decade now. Murky rules and laws have, in part, slowed crypto’s institutional and mainstream and option and regulation helps clear up the uncertainty. Second, stablecoins are quickly becoming “the use case” within crypto and certainly having a moment with Circle’s successful IPO and Stripe’s stablecoin/wallet acquisition spree.
Our hope is that this momentum turns into even realer, more mainstream results with large companies and institutions adopting stablecoins to put their businesses on “room-temperature superconductors for financial services.”
There are indications that is happening already. JPMorgan, America’s largest bank, is launching a stablecoin-like deposit token, JPMD, on Coinbase’s Base L2. Not exactly a stablecoin, a deposit token is a digital representation of a commercial bank deposit, but it gives the money stablecoinesque digital powers: it will offer round-the-clock settlement and can pay interest to holders.
Probably nothing.
(5) ‘Remarkable’ new enzymes built by algorithm with physics know-how
Heidi Ledford for Nature
Computer algorithms have designed highly efficient synthetic enzymes from scratch, with minimal need for tedious hands-on experiments to perfect them. The resulting enzymes catalyze a chemical reaction that no known natural protein can execute, achieving a reaction rate and efficiency similar to naturally occurring enzymes.
In a rare L for AI, researchers developed a new way to build synthetic enzymes, tiny proteins that speed up chemical reactions, using a physics-based computer model. These enzymes are 100 times more efficient than ones created with traditional AI, and they can perform chemical reactions that don’t occur naturally. Instead of using trial and error in the lab, the scientists simulated how atoms move and interact, which allowed them to design enzymes from scratch on a computer.
One big breakthrough came when the algorithm challenged a long-standing belief about how enzymes should be built, replacing a complex component with a simpler one that worked even better. The result was an enzyme that looked completely different from any found in nature, with over 140 changes to its structure. This approach could help scientists quickly and cheaply create custom enzymes for making medicines, cleaning up pollution, producing sustainable fuels, and more without waiting years for lab experiments to catch up.
Just a remarkable week for the optimist, indeed.
BONUS: Sari Azout on Hyperlegible
When I first started using AIs, I feared that machines were becoming more human. And yes, it is getting harder to tell the difference. But that's not just because machines are becoming more humanlike, but because humans are becoming more like machines.
Packy here. Earlier this week, I had Sari Azout — a former VC, the founder of Sublime, a friend, and a writer whose work I've long admired; we actually co-wrote the first piece I ever wrote on crypto about a company called Fairmint — on Hyperlegible to discuss her presentation / essay, Becoming unLLMable.
Sari is one of the most thoughtful and tasteful people on the world wide web, something that comes across in her writing, in the product she's building at Sublime, and even her background in this video. While a lot of people are talking about what AI means for humans, Sari is one of the few people I actually want to talk to about that topic.
Because of the format in which she originally presented these ideas, we did this one a little differently. To kick us off, Sari gives the presentation that we gave in Stockholm, and then we dig in on questions I had and things I've been thinking about.
It's characteristically Sari: optimistic but practical, grounded in facts but unafraid to imagine, and informed by her perspective as someone actually using AI to build a product and voice that stands out in a sea of undifferentiated slop. We discuss a bunch of though-provoking ideas, my favorite of which is that average is now attainable by everyone, which means to stand out, you need to be way better than average. She is a case study on how to do that.
DOUBLE BONUS: Jason Carman x Abundance Institute
My friend Jason Carman, the best filmmaker in optimism, teamed up with Abundance Institute, where I’m a Senior Advisor, to make a film on him and his work making films. It’s a full-throated endorsement of something we believe strongly at Not Boring: the future needs a better story.
This is a great peek behind the scenes into Jason’s process, where Story Co is going, and his excellent Too Cheap to Meter energy documentary featuring Not Boring Capital portfolio companies Fuse and Base Power Company and some favorite founders like Casey Handmer of Terraform Industries, Julia DeWahl & Jordan Bramble of Antares, Bret Kugelmass of Last Energy, Isaiah Taylor of Valar Atomics, and Doug Bernauer of Radiant.
The future is bright. Jason is one of the best at telling its story.
Have a great weekend y’all.
Thanks to INBOUND for sponsoring. We’ll be back in your inbox next week.
Thanks for reading,
Packy + Dan
2025-06-13 20:41:06
Hi friends 👋 ,
Happy Friday, welcome back to our 148th Weekly Dose of Optimism, and ciao from Pietrasanta, Italy, where DAN IS GETTING MARRIED TODAY.
It would be inappropriate for Dan to write the Dose on his big day, but it would also be inappropriate not to send the Dose on the most optimistic day of his life, so I’m taking over the writing duties for today.
Dan picked a wild week to take off. Riots in LA. Plane crash in India. Israel striking Iran. “Nothing ever happens” is under siege.
But those stories get plenty of coverage and are not what we cover in the Dose. Fortunately, the people pushing the world forward have not taken Dan’s wedding week off, either. We have stories on leukemia, nuclear, self-driving Ubers, and all sorts of big startup news.
We have some celebrating to do, so…
Let’s get to it.
Just Revealed: the INBOUND 2025 agenda is officially live! With content designed to challenge how you think about growth, INBOUND is your chance to learn how to build what’s next.
Join icons like Dario Amodei, Sean Evans (Hot Ones), Marques Brownlee, and Amy Poehler for three days of insight-packed sessions on how emerging trends are creating entirely new approaches to business. A lot of conferences are about far-future speculation. INBOUND isn't. It's about immediately applicable frameworks that give businesses a competitive edge.
For the first time ever, INBOUND comes to San Francisco for a one-time-only West Coast experience at the epicenter of global innovation. This limited-edition event places you in the heart of the world's AI capital, offering access to the thinkers who are defining what's next in business.
Not Boring readers get 10% off their INBOUND General Admission ticket with code NOTBORING10 (Valid thru 7/31). Come for the insights, stay for the network.
(1) Childhood leukemia: how a deadly cancer became treatable
Saloni Dattoni in Our World in Data
Childhood leukemia was fatal for the vast majority of children who developed it in the past. Before the 1970s, fewer than 10% of children diagnosed with the disease survived five years after diagnosis.
But since then, this outlook has improved dramatically. In North America and Europe, around 85% now survive that long.
If the Dose has a bigger enemy than cancer, it’s childhood cancer.
And based on this new report from Saloni Dattoni at Our World in Data, we are glad to say: get fucked, childhood cancer!
In the late 1960s, under 10% of children survived more than 5 years after an leukemia diagnosis. By the 2010s, over 85% of children in the US and Europe survived more than 5 years after diagnosis. Those numbers need to get to “100%” and “more than 80 years” for us to really start popping the champagne, but that is stunning progress.
That means that deaths from childhood cancer have dropped from 11 per 100,000 to roughly 2 per 100,000. That’s millions of kids given the opportunity to live a full life, and millions of parents spared from the agony of losing a child.
Treating leukemia still involves brutal chemotherapy, and we’re hopeful for breakthroughs in cell therapies that can make treatment more painless and effective, but this is a story of lots of incremental progress made by thousands of doctors and researchers across the world compounding over decades.
Progress happens both ways, and we’re glad OWID pulls the numbers to show how big an impact the less sexy kind can have.
(2) World Bank lifts ban on funding nuclear energy in boost to industry
Jamie Smyth and Claire Jones for Financial Times
The World Bank is lifting its decades-long ban on financing nuclear energy, in a policy shift aimed at accelerating development of the low-emissions technology to meet surging electricity demand in the developing world.
Another day, another piece of good news for the nuclear industry (read: another piece of good news for all of us.)
When Julia and I did our season of Age of Miracles in 2023, a big reason we chose nuclear is that it was a bellwether for the world’s sanity, and for humanity’s ability to actually put the miracle technologies we’ve built into practice. For all of the reasons we discussed on the show and in this newsletter, nuclear is a no-brainer. It’s clean, energy-dense, reliable, and safe. If we developed it today, we’d be having parades. But for a whole host of reasons, everything from economics to regulation to “environmentalist” opposition to fear, we stopped building new nuclear capacity in the United States.
For its part, “The World Bank has not backed a nuclear project since 1959, due both to opposition from Berlin and concerns from some countries about nuclear proliferation.”
That’s changing. Germany, under Chancellor Friedrich Merz, is dropping its opposition, the Trump Administration supports nuclear, there’s no way to meet either the world’s clean energy goals or our growing demand for electricity without nuclear, and, it seems, the world is snapping out of its temporary insanity around the technology.
While World Bank president Ajay Bagna said, and we agree, that private sector investment is essential to nuclear’s development, the World Bank can support and backstop projects with guarantees and equity. This includes support for the development of small modular reactors.
The World Bank is even considering supporting upstream gas development, which would have been unthinkable a few years ago. We support that support. With more energy, we can figure everything else out.
There is no such thing as a low-energy rich country. The World Bank is coming to realize that there is no such thing as a low-energy rich World.
Financial support is an important step in the right direction, but to fuel the nuclear revolution, we’re going to need a lot of nuclear fuel…
(3) The Audacious Reboot of America’s Nuclear Energy Program
Christmastime brought relief. A group of venture capitalists, led by a former Special Forces officer, invested $42 million to reboot and rebrand the company Standard Nuclear.
The deal marked an extraordinary bet by venture capitalists, who have historically steered clear of heavily regulated enterprises that require huge amounts of capital up front. The lure of AI and heightened competition with China have changed that calculation.
That’s where Not Boring Capital portfolio company Standard Nuclear comes in.
This week, the WSJ told the story of how Standard Nuclear came to be. It’s an inspiring one.
As Ultra Safe Nuclear, which was making both reactors and TRISO fuel, ran out of funding after the death of its main backer, its fuel scientists worked up to eight months with no pay to keep the gang together. They believed, rightly, that TRISO manufacturing was so underdeveloped in America, and so necessary to the country’s future, that it was worth personal sacrifice to ensure the team’s capabilities survived.
They held it together long enough for a team of investors, led by Tommy Hendrix at Decisive Point, to reboot the fuel business with $42 million and rebrand it Standard Nuclear.
I’m proud to be a part of this one, and think it’s going to be a monster business. The more companies work to build advanced reactors, the more demand there will be for its products. It’s a crucial part of the advanced nuclear value chain, which is a critical part of the world’s energy future. In short: if Standard wins, we all win.
(4) Wayve and Uber Partner to Launch L4 Autonomy Trials in the UK
Wayve and Uber (NYSE: UBER) today announced a first-ever plan to develop and launch public-road trials of Level 4 (L4) fully autonomous vehicles in London. This announcement marks the UK as the largest market where Uber has announced an intention to pilot autonomous vehicles.
Long before hating modern autonomy technology was cool, London’s cabbies fought Uber’s entry into the market.
The city’s black cab drivers must pass The Knowledge, a famously difficult test requiring the memorization of 25,000 streets and 20,000 landmarks. Passing typically takes 3-4 years of full-time study, and it’s so difficult that a 2000 UCL study found that London cab drivers have significantly larger posterior hippocampi, the brain region critical for spatial navigation, than average people or even bus drivers. The more years they’d been driving, the more pronounced the posterior hippocampi.
Now, self-driving company Wayve’s AI brain is big enough to hold The Knowledge in its computer head.
This week, Wayve and Uber announced a first-ever plan to develop and launch public-road trials of Level 4 (L4) fully autonomous vehicles in London. The market in which Uber faced the most driver opposition is now the largest market in which the company has announced plans to pilot autonomous vehicles.
The UK government is helping pave the way with new regulations and an accelerated framework for self-driving commercial pilots, yet another sign that (the artist formerly known as, in this case) Europe is finally realizing that technology is good, innit.
Oi! Fair play! Good on them! Well in!
(5) Tech is HUMMING
We’re investing against the thesis that all incumbents are going to get nuked and everything is gonna get rebuilt.
That clip is from Marc Andreessen on Jack Altman’s Uncapped podcast, and it sums up the Not Boring Capital thesis beautifully: “all incumbents are going to get nuked and everything is gonna get rebuilt.”
Because Dan’s busy and not paying attention, I’m going to use the clip as an excuse to talk about a whole bunch of things that have happened this week in one of tech’s most active weeks in a while.
First things first, The Information reported that Meta is going to pay $14.3 billion to acquire 49% of Not Boring Capital portfolio company Scale AI and bring in Scale’s founder Alexandr Wang to help lead its superintelligence efforts. The deal is a big win for Little Tech and a nice cash infusion back into VCs’ LPs’ pockets.
It’s also a validation of Wang’s long-term vision for the company, which was anything but obvious when they were doing manual data labeling for autonomous vehicle companies, before the LLM craze. I wrote about Scale’s plan back in June 2021:
Speaking of acquisitions, Stripe is making its second big crypto bet, acquiring wallet infrastructure company Privy.
Terms of the deal haven’t been disclosed, but this is a meaningful acquisition and not an acqui-hire. My friend Simon Taylor broke down the rationale here: “Bridge handles stablecoin rails. Privy handles the wallet complexity. Stripe keeps its reputation for simplifying complexity for developers.”
Meanwhile, Anduril announced a $2.5 billion Series G at $30.5 billion post-money, Founders Fund’s largest investment ever. Anduril co-founder Palmer Luckey went on CNBC and said that Anduril is definitely going to go public and that the company is working to become public-market shaped (which he previously described as, “the right shape for a Wall Street weenie to tell his boss that we are a safe part of their institutional portfolio.”). An Anduril IPO would be a massive return event for the industry, and fund a whole lot more Vertical Integrators.
Speaking of which, Meter, which I wrote 100 pages on in January, announced a $170 million Series C. After writing the piece, I was relieved to get the opportunity to back the company on its journey to move every packet.
And finally, Nominal, which makes the software used by many of the hard tech companies and vertical integrators we cover here in Not Boring, which “powers mission-critical engineering work across aerospace, energy, automotive, and defense. Automation, analytics, and operations,” raised a $75 million Series B from Sequoia and others. Nominal is an index on America building big, complex things faster, so this is a good sign for all of us.
I missed a bunch, but it’s been a huge week for startups. These weeks are only going to keep getting huger. A big week now will be an average one in a year or so. The future is bright.
Have a great weekend y’all.
Thanks to INBOUND for sponsoring. We’ll be back in your inbox next week.
And now… let’s go get Dan married!
Thanks for reading,
Packy + Dan
2025-06-10 20:44:46
Welcome to the 411 newly Not Boring people who have joined us since our last essay! Join 244,610 smart, curious folks by subscribing here:
Ramp is more than a corporate card (although it makes a great one). The card is the portal into a full suite of products designed to help your business grow intelligently and help you save time. Imagine: never chasing down your team, or being chased, for receipts. Ever. Again.
With Ramp, your finance team has the best engineers in fintech, like Calvin, working on your behalf to make sure that you get the control and visibility they need, without the busywork.
Ramp is one of my favorite companies in the world. It’s the only company I’ve written about four times and invested in three times. The company just keeps getting better, which means your finance team does, too.
Ramp is so much better than the alternatives that I bet your team will eventually run on Ramp. Just start now, and start compounding the benefits of working with a company that makes your company run better. Reply to this email to let me know when you switch.
Upgrade your team to Ramp: The Official Business Card of Not Boring.
Hi friends 👋 ,
Happy Tuesday, and ciao from Italy, where the Not Boring team is getting ready to celebrate Dan and Sienna’s wedding!
Maybe it’s the love in the air, maybe it’s the architecture, maybe it’s the history, or maybe just the Lambrusco, but being here has renewed my belief that we must, and can, make the world more beautiful. That even as we use our left-brains to accelerate progress, we can use our right-brains to birth a new Renaissance.
And billionaires might just be our best shot.
Let’s get to it.
In The Master and His Emissary, Iain McGilchrist writes about the differences between the right and left hemispheres of our brain.
Our left-brain is narrow, analytic, grasping. Our right-brain is broad, contextual, alive.
We need both, but in a healthy person (or a healthy society), the right-brain is the Master, and the left-brain his emissary.
When the left-brain is in control, intuition dies. It’s “not a lack of reasoning; it is in fact a hypertrophy of rationality, in which everything that is intuitively understood has to be painfully and laboriously reasoned out from first principles.”
He’s describing schizophrenia here, but he could be describing LessWrong.
What’s true in humans, McGilchrist argues, is also true of civilizations. In his books, he maps the hemispheric tilt of western civilization over time.
The Renaissance was the peak of right-brained civilization. Today, the left-brain dominates. In a 2023 Unherd interview, he is very clear on this point:
Interviewer: Do you think we have ever been in a moment as left-hemisphere-dominated as we are now?
McGilchrist: No, I think this is hitherto unseen.
The right-brain sees living, connected things. The left-brain sees lifeless machines that it can deconstruct and put back together.
As McGilchrist writes in The Master and His Emissary: “If we assume a purely mechanical universe and take the machine as our model, we will uncover the view that – surprise, surprise – the body, and the brain with it, is a machine.”
Anyway, here is part of a commencement speech that OpenAI and SSI co-founder Ilya Sutskever gave at the University of Toronto the other day:
Watching this while reading McGilchrist is a trip. It is exactly and explicitly the point he is trying to make.
Once you see the left-brained framing, you notice it everywhere.
This is “we are the fastest company to ever hit $100M ARR,” every week.
This is Cluely hiring strippers to convince you to Cheat on Everything.
This is Effective Altruism.
This is a bureaucracy whose processes take precedent over the results they were established to achieve.
This is a group of people that seems resigned to the fact that AI is going to make us useless, even excited by the prospect. As past Hyperlegible guest Parakeet put it, “people turn into absolute cucks”:
This is … fill in your favorite examples.
Look at me using words and specific examples to make my point, though. Very left-brained.
The truth is: you can feel it, if you’re paying attention.
The good news, I think, is that the dizzying left-brainness is the sign of a peak, Late Stage Left-Brainism, a Left-Brain Fourth Turning, whose logical conclusion will leave people thirsty for something completely different.
Whether we continue to let the left-brain play Master or return the right-brain to its rightful role will determine whether we live in a world built by and for machines, or one built by and for humans.
So is our civilization’s future left-brained, which McGilchrist argues could lead to our collapse?
Well, the internet has produced a lot of writing on the future of work in the age of AI recently.
Painting with a broad and probably unfair brush, the premise goes something like: “You know how companies work today? Imagine exactly that, but with AI agents replacing everyone but the CEO. But, like, it’s a Super CEO, and many copies of him.”
I find most of it uninspiring, uncreative, and most likely wrong.
One of the themes of this newsletter is that people don’t realize how quickly or how much things can change, and do a bad job anticipating what the world will look like as a result. That was the point of Everything is Technology and Chaos is a Ladder and many other pieces I’ve written.
The dystopian future, so obvious to so many, will not come to pass.
But the truth is, traditional incentives aren’t going to put the right-brain back in control. Companies have to do what they believe will generate the most shareholder value. They are incentivized to be left-brained, because left-brained is legibility, and legibility means funding.
In the process of creating shareholder value, however, many individuals have become fabulously wealthy. And it’s these individuals, set for life, spending their own money, free from plebeian ROI considerations, who can usher in a modern Renaissance.
Our billionaires may be our best hope, as the Medici were Florence’s.
We must revive Magnificenza.
They say that Bologna once looked like Medieval Manhattan.
Between the 12th and 13th centuries, the Bolognesi built as many as 180 towers, though historians suggest the real number is closer to 100, measuring as high as 97 meters. Today, that 97-meter Asinelli Tower still stands, one of 22 remaining.
I know this because I’m currently in Italy, writing this from outside of Bologna. On our first night in town, we took a tour of the city, during which our guide told us all about the towers, and asked: “What do you think the towers were for?”
We guessed defense, religion, housing. Kind of right, absolutely wrong, and technically wrong, respectively (technically, some families built houses next to their big towers).
The real answer is that wealthy merchant families built the towers to show off.
After the Investiture Controversy, a war between the Holy Roman Empire and the Church over who could choose and install religious leaders, wealthy merchant families filled the power vacuum to become the de facto rulers. Each family picked a side – Ghibelline (Empire) or Guelph (Church) – while simultaneously competing for local dominance in the coming paradigm, one in which authority was no longer bequeathed by Church or Empire but earned.
So they built towers, each taller than the next, to prove their worthiness to rule.
This practice, abstracted from towers into grand projects for the benefit of the city, continued into the Renaissance, and for the same reason.
Renaissance Italy was a fragmented landscape of competing city-states, merchant republics, and princely courts where political power was often precarious and newly acquired. Noble bloodlines no longer automatically conferred legitimacy. The Medici, those patron saints of patronage, rose to prominence through banking, not birthright.
Two things happened in the 14th Century that would launch the Renaissance and the Medici’s role in it.
First, the Black Death decimated the Italian population, which was bad, but resultantly increased the resources per worker and improved labor productivity, incomes, and standards of living, which was good for those who survived.
Second, the newly-opened trade routes between Europe and the East created a new kind of economy: instead of barter, coins. Florence became the center of the burgeoning financial industry, and the gold florin the main currency of international trade.
This is the Florence Giovanni di Bicci de’Medici was born into in 1360, and from relatively modest beginnings, thanks to a cousin under whom he apprenticed, a marriage that gave him a large dowry, and savvy parlays, he founded the Medici Bank in Florence in 1397. The Medici Bank became the wellspring from which his family’s largesse flowed.
That we know the name Medici is due to Bicci’s son, Cosimo de’Medici (“the Elder”), who inherited his father’s business and understood that to protect it, he must acquire political influence in Florence. He did that similarly to the way Bologna’s leading families had two centuries prior: by spending lavishly and publicly, in his case, through large public works and cultural projects.
Cosimo reconstructed the Basilica of San Lorenzo, which would become the Medici family church, built Palazzo Medici, assembled one of Europe’s greatest libraries in order to position Florence as the heir to ancient Athens and Rome, and supported the artist Donatello, whose bronze David was the first freestanding nude sculpture since antiquity. He also supported Brunelleschi, the architect who engineered the Duomo, and funded its completion. Six hundred years later, it is Florence’s most recognizable symbol.
After Cosimo, his son, Piero de’Medici, took over the family business. His nickname, due to a familial medical condition, was “the Gouty.” Tough. He worked largely to maintain the legacy his father had created; his most impressive creation was his own son.
Lorenzo de’Medici ruled with his brother, Giuliano, from 1469 until the Pazzi family attempted to assassinate both of them during Mass at the Cathedral, and succeeded only in killing Giuliano, in 1478. Then, Lorenzo ruled alone with the support of the Florentine people. After the attempt, the Pazzi expected the Florentines to join them in their cry for “People and liberty!” Instead, they shouted “palle! palle!”, a reference to the balls on the Medici coat of arms.
What the people gave to Lorenzo in legitimacy, he gave back in support of Florentine culture and arts.
Lorenzo patronized Botticelli and Michaelangelo, and recommended Leonardo da Vinco to the Sforza. He created the Platonic Academy among his circle of friends, including Marsilio Ficino, Pico della Mirandola, and Politian, an attempt to recreate the philosophical environment of Athens and establish Florence as the seat of Western learning. A poet himself, he wrote in Tuscan dialect, not Latin, establishing Italian as a legitimate literary language. He built the infrastructure for the Florentine Renaissance.
For this, he was given the name Lorenzo il Magnifico: Lorenzo the Magnificent.
When we hear the word “magnificent” today, we think “great” or “awesome” but amped up, fancier. Back then, though, it had a more specific meaning.
In Nicomachean Ethics, Aristotle counted “magnificence” among the moral virtues. Magnificence, megaloprepeia in ancient Greek, was “a fitting expenditure involving great wealth.” More than generosity – me buying you a sandwich when you’re hungry – magnificence meant tastefully spending large amounts of money in the right context. “The magnificent man will spend gladly and lavishly,” he wrote, “since that is proper to him; but he will look to what is suitable to the occasion and will spend in a dignified and fitting way.”
Magnificence was more than lavishness, however. Showiness and ostentation were not magnificent. Buying yourself a Rolls Royce La Rose Noire Droptail is not Aristotelian magnificence. Spending for your city is. “He will build more gladly for the city than for himself,” wrote Aristotle, “and temples and all public works are of this kind.”
Magnificence had to be beautiful, ROI be damned. “In everything he will spend not for himself but for the sake of the work;” per Aristotle, “and the cost will be measured by the worth of the work, not by its owner's means.”
Magnificence was big and beautiful for the benefit of the public. Receiving foreign dignitaries, making religious offerings, erecting public buildings, funding festivals and entertainments, throwing weddings, lavishly decorating a house (“to suit a great man”).
Aristotle’s conception of Magnificence made its way to Florence via a circuitous route across space and time. Lost to the West after the fall of the Western Roman Empire, it survived through Islamic scholars like Avicenna and Averroes, until the Crusades and increased trade with Byzantium brought Europeans back into contact with Greek-speaking Christians, and with the Arabic translations of Aristotle. There, Latin scholars retrieved manuscripts and began commissioning translations, from Arabic, and then directly from Greek. Meanwhile, with the fall of Constantinople in 1453, Greek scholars fled to Italy, bringing with them the original Greek manuscripts and the ability to teach the language directly. This Greek influx, the invention of the printing press, and a renewed interest in Greek philosophy, accelerated the spread of Aristotle’s ideas that was already afoot.
By Lorenzo’s time, Nicomachean Ethics was widely available in Latin and were both read and taught by the Florentine humanists, like Marsilio Ficino, the very friends Lorenzo supported in the Platonic Academy!
These humanists reinterpreted Aristotle’s Magnificence through the lens of civic humanism. The virtuous citizen improves his city through beauty, order, and public works. They called it Magnificenza.
The practice pre-dated the Italian name. The Bolognesi built towers three centuries earlier in a form of proto-Magnificenza. The Medici had already been supporting beauty and public works for three generations by the time Lorenzo ruled. But the scholars codified Magnificenza and supported it with its Aristotelian heritage, and Lorenzo il Magnifico became its greatest practitioner.
I want to give an overly simplistic summary sure to make historians throw up, so we might begin to see some parallels between that time period and ours.
The ur-cause of Magnificenza was the declining power of the institutions that had ruled medieval European society: the Church and the Empire. Into this power vacuum stepped merchant families, who made up for what they lacked in legacy and name with their skill for organization and their money. They used new forms of capital – financial and cultural – to establish legitimacy and prove their ability to rule.
At the same time, in the 14th Century, just as Giovanni di Bicci de’Medici was born, the Black Death killed off 30-60% of the population in some areas, leaving more wealth and resources to survivors, driving up wages as a result of labor shortages, ending some noble bloodlines (giving merchant families more opportunity for upward mobility), and driving the population into city centers like Florence all of which concentrated wealth and talent and created the concentrated audience for grand public works in cities. Meanwhile, new trade routes meant new money which meant an opportunity for new banks.
The Medici Bank (and other banks and businesses, but most prominently the Medici Bank) profited from this transition, generating the coin with which to grow their influence.
Finally, a renewed appreciation for the Ancient Greeks, for Plato and Aristotle, cemented the flow of these funds towards beautiful cultural and public works as the best route to influence, and to morality, for the merchant families competing to win both.
Fall of institutions. Demographic shock. Concentration of wealth. Desire for beauty. Will to power. Magnificenza.
The causes sound familiar, almost modern.
And what were the effects?
Magnificenza created a new kind of economy centered on cultural production instead of pure profit. In fact, Lorenzo spent so freely that the Medici Bank declined under his rule. But while the Bank declined, the city rose. Renaissance Florence became the cultural and intellectual center of the western world. And with the city, the fortunes and skills of its citizens.
Wealthy patrons funded workshops, academies, and public works that employed armies of artists, craftsmen, scholars, and apprentices. All of this created jobs, to be sure, but it also diffused skills. Young people learned through hands-on work on prestigious projects, gaining technical mastery, cultural knowledge, and powerful networks. Michelangelo, Botticelli, and de Vinci all accomplished more after Lorenzo’s death than during his life as a result.
The apprenticeship system produced a cascade of talent: apprentices became masters, masters trained new apprentices, and knowledge spread throughout society. Cities like Florence became magnets for the brightest minds, creating concentrated hubs of innovation and creativity.
The competition for magnificence drove rapid advancement in art, architecture, engineering, and philosophy. Each patron tried to outdo the others, funding increasingly ambitious projects. In the place of just towers, painting, sculpture, literature, grand projects, and also towers. This created a virtuous cycle: better projects attracted better talent, which enabled even better projects.
I have long been obsessed with Scenius, which Brian Eno defined as “the intelligence and the intuition of a whole cultural scene. It is the communal form of the concept of the genius.” Renaissance Florence, thanks in large part to Magnificenza, is the canonical example.
Most importantly, Magnificenza aligned private wealth with public benefit. The most socially admired way to spend money was on beautiful, lasting works that elevated the entire city. Personal ambition served collective flourishing. To understand this as charity is mistaken. It was a rare incentive alignment between private and collective good.
Skill-based apprenticeship economy. Talent concentration. Innovation acceleration. Alignment of private wealth with public good. Cultural renaissance.
Those were the effects of Magnificenza. They, too, sound modern, at least aspirationally.
It is fairly popular to call for a modern Renaissance, and all too easy to overfit the facts to a narrative that suggests we’re entering one. But the parallels are striking.
We live in an era of declining trust in institutions. Last year, Pew collected some of the Data Behind Americans’ Waning Trust in Institutions. Average confidence in major U.S. institutions is down from ~50% in 1979 (coming off of Watergate and Vietnam, mind you) to just 26% today.
And the distrust is broad-based, with trust in the church, banks, public schools, and the medical system cut by more than half in the past half-century. Higher education, which has only been measured since 2015, is already down from 57% to 36%, and I would imagine if we took the poll again right now, it would be even lower.
Perhaps most poignantly, Elon Musk, the world’s richest person and our best cost-cutter, just spent seven months inside of the government and came out saying, basically, “This is hopeless.”
This does not spell the end of the American Empire – I’ve written that I believe we’re just getting started on the American Millennium – but it does create a vacuum that new forms of power might fill.
The new tech elite are positioned to fill this vacuum. They are where wealth is concentrating.
The four richest people in the world, all tech founders, are personally worth more than $1 trillion combined and control companies worth much more.
And as I wrote in Everything is Technology and Tech is Going to Get Much Bigger, I expect these outcomes to get much, much bigger.
When Forbes released the first list of the 400 richest Americans, it only took $100 million to make the cut. The richest person on the list, Daniel Keith Ludwig, was worth $2 billion. Today, that would place him 1,815th, between Italian financiers Annalisa and Massimo Doris.
The nature of the list has changed, too. The inaugural 1982 Forbes 400 top 14 included a lot of oil money, heirs and heiresses, and smattering of candy, football, and media.
Today, the list is dominated by tech, and by the entrepreneurs who created their own fortunes. The first heirs, the Waltons, show up in 14th and 15th slots.
This means that many of the world’s richest people are still young and capable of building new things. Instead of handing their fortunes to others, the tech elite want to build their own legacies.
Last year, I had the pleasure of attending a weekend summit hosted by Nadia Asparouhova and Tim Hwang about Silicon Valley Ideology and tech’s rise from industry to elite. One of the participants was Professor Peter Frumkin, who shared his framework of “instrumental” versus “expressive” giving. Nadia wrote about this distinction in her new book, Antimemetics, and I’m going to reproduce the section in full because it touches on so much of what we’re talking about:
In his book Strategic Giving: The Art and Science of Philanthropy, philanthropy scholar Peter Frumkin identifies a key consideration for developing philanthropic strategies, which he calls instrumental versus expressive giving. Instrumental giving focuses on measurable outcomes and is driven by a desire to solve specific, often large-scale social problems with efficiency and precision – like the effective altruists’ approach. Expressive giving, by contrast, emphasizes the personal values, beliefs, and identity of the donor.
Impact is measured according to individual or community values, even if the outcomes are less deterministic.
Frumkin’s telling of history suggests that we’ve already seen the utilitarian worldview play out. With the passage of time and rise of professional norms in philanthropy – accelerated especially by restrictions imposed by the 1969 Tax Reform Act, such as stricter reporting requirements and mandatory payouts – Frumkin argues that philanthropy went too far in the direction of instrumental giving. An overfocus on efficiency turned into a race to the bottom, where all philanthropic strategies became indistinguishable from one another.
Philanthropy is meant to be pluralistic, reflecting a diverse expression of values from private citizens who exercise the freedom to put their money wherever their ideas are. Instrumentalized philanthropy, on the other hand, starts to mirror the role of government, where there is a single, authoritative way of doing things.
“Philanthropy went too far in the direction of instrumental giving. An overfocus on efficiency turned into a race to the bottom, where all philanthropic strategies became indistinguishable from one another.”
If that sounds familiar, it is because it’s how a left-brain dominant society would do philanthropy, how a left-brain dominant allocates resources more generally. Frumkin, like McGilchrist, argues that it’s swung too far in one direction.
With the declining trust in institutions, including charities, simply giving to charity doesn’t come with the same prestige that it once did.
The new ethos is something like: Doing, Not Davos.
Meanwhile, there are some differences between now and then, but I think those differences horseshoe to the same place.
The Black Death created the economic and social conditions that made the Renaissance possible: higher wages, concentrated urban populations, weakened traditional hierarchies, and new opportunities for merchant families. But between the Black Death and the Renaissance, there was also social upheaval, labor revolts, and economic instability.
The Renaissance’s cultural flowering required those families to choose magnificence over mere profit accumulation, both out of a sense of moral duty and self-preservation. And after a period of senseless death, people were starved for meaning and beauty, which gave merchant families a direction in which to spend.
Today, AI presents a potentially equally large shock – replete with social upheaval, labor revolts, and economic dislocation, but also higher wages, weakened traditional hierarchies, and new opportunities – in the opposite direction, from a population perspective. Instead of mass deaths leading to relative abundance for survivors, we have billions of proto-intelligent software “beings” competing for jobs. We have to feed them with data centers and chips and energy.
And while I don’t think AI will take all of our jobs and render humans meaningless meatsacks – see: Most Human Wins; see: Intelligence Superabundance; see: Goldilocks Zone – while I think they’ll actually make humanity richer and better off, it would be naive to argue that their arrival won’t have an impact on the shape of society.
The dominant corporate structure will not be one person companies powered by AI workers, but I do expect that we’ll see a hollowing out of entry-level jobs, which will in turn hollow out the junior → experienced worker pipeline, which is a problem that will need to be solved.
In fact, AI will likely create a few problems that I think are best solved by people using AI.
One of the challenges of the left-brained modern world is that people are once again starved for beauty and meaning. This was happening before AI.
But AI is an accelerant. It’s driving us faster and faster to the conclusion that we will not find beauty or meaning in the machines. It’s making us ask a lot of questions.
One area where people are searching and coming up empty is the quest for beauty.
The internet is drowning in slop. Some say the word is overused, but I don’t think it’s used enough. Every tweet has an AI-generated reply. Every day, I get multiple emails clearly written by AI. You read essays and you can just smell the LLM. You see images, and you see the same.
Slop is the antithesis of beauty. Slop is what you get when you focus on what you can measure – “we outbounded to 1,200 people today” – and in so doing, crowd out the beautiful.
Slop is not limited to the digital world.
X designer and Party Round Mafia member Brandon Jacoby recently tweeted about the slopification of cities: the same outdoor breweries, the same ugly apartments.
He got roundly dunked on. The dunks were diverse, but something to the effect of: “Well, we need more housing and people who live in these places seem to like them and don’t be a YIMBY. Instead of just saying we don’t want that, tell us what you think would be better.” The latter of which Jacoby responded to with:
- true to themselves
- represents culture / history of the city they’re in
- stands for something
- has soul
- optimizes for quality not just cost
I am on Team Jacoby here. Walk through any European city. Drive through a modern mega-development. Tell me how each makes you feel.
All of this is symptomatic of the same thing: a favoritism towards that which can be measured over that which can’t.
Last month, Stripe’s Patrick Collison interviewed Apple-now-io designer Sir Jony Ive at Stripe Sessions in a much-discussed conversation.
While some, like my friend Reggie James, critiqued the messenger (“We believe in principled service. And that’s why I just made a $64,000 record player WUTTTT????”), the message seemed to deeply resonate with people. The message was something like: “Don’t let the measurable crowd out the beautiful.”
And the internet, collectively, went:
At the same time, as people are bombarded with the message that AI will be able to do everything that they can, but better, they’re rightly wondering about meaning.
Why are we here? Are we just biological bootloaders? Can AI really do everything that I can, but better? What is it that I can uniquely do? What is my purpose?
While I think the threat that AI will replace us all is overhyped, not even close to right, one of the most positive aspects of its arrival is that it’s forced people to look in the mirror and ask what the hell it is that we’re doing here.
Often, as McGilchrist might have predicted, we come up wanting, realizing that much of what we do day-to-day can be replaced by machines.
Certainly, one of the areas in which humans have found meaning, at least since the Industrial Revolution and the shift to a left-brain civilization, is in work.
(For the avoidance of doubt, I am an Industrial Revolution maxi, I welcome the Techno-Industrial Revolution, and I love work. It’s just that it’s only half the picture, and we’ve elevated it to a much larger share.)
The truth is, the more machine-like jobs are going away.
The Official Not Boring AI View is that we’ll end up in the Goldilocks Zone: “with assistants that continue to get more and more capable the more data and compute we feed them, and that have absolutely no desire or ability to overtake us.”
I wrote that essay a year ago, and while the models have gotten smarter, I haven’t seen anything that’s changed my view. The last-mile problem is going to be really hard, and potentially impossible, to solve under the LLM paradigm. Humans might actually become more valuable in the process.
Having said that… our economy supports an awful lot of Bullshit Jobs that probably aren’t safe. It also supports a lot of jobs that are kind of bullshit but that are necessary in the current system for young people to gather the skills and experience they need to do more meaningful work.
Entry-level jobs are how people learn to work, and how they pick up the tacit knowledge that comes from working with more experienced people. Unfortunately, it seems like a lot of these jobs are going to go away, too.
Think about being a junior lawyer, maybe the ultimate “endure pain doing bullshit now so you can gain the experience and knowledge you’ll need to be really successful in the future” job.
Junior lawyers work ungodly hours at good salaries doing legal research, reviewing documents and doing due diligence, drafting documents for review, taking notes and shadowing senior lawyers in meetings and court, and providing administrative support. The Suits situation where Mike Ross contributes novel, case-breaking insights daily seems almost entirely fictional.
Now, we have tools like Harvey, Clio, Ironclad, CaseText (now ThomsonReuters CoCounsel), Luminance, and dozens more that promise to automate a lot of that rote, repetitive, time-consuming, and expensive work.
Imagine that, for every industry.
In the short-term, that will be great for companies’ bottom lines. In the medium-term, it will hollow out the green-to-experienced pipeline. If you think that by the time that bill comes due, AI will be good enough to replace the need for experienced people, too, that’s fine! If you, like me, don’t think that, then it creates a real issue (with a lot of social upheaval in the meantime).
And right on cue, here’s Bloomberg:
There’s an argument to be made that even this scenario is too pessimistic. When Excel came out in the 1980s and spread in the 1990s, allowing finance professionals to build models that would have taken weeks by hand in just hours, they didn’t hire fewer junior employees. They hired a lot more. This is the growth of finance jobs since the early 1990s:
Think about it. Would a Managing Director in the 1980s, whose value was in understanding how companies fit together and building relationships with key players, pull back from those activities to become great at Excel? Or would he hire smart, hungry people who were raised on computers and motivated to get really, really good at Excel?
Ironically, Excel’s boom is probably a major contributing factor to the world’s left-brain tilt. With the ability to financialize more, we’ve financialized everything. There is a reason the type of left-brain bias McGilchrist describes is called “spreadsheet thinking.”
Almost certainly, something similar will happen with AI. Senior people will hire AI-native junior people who, no matter how good AI gets within reason, will be capable of getting more out of the tools for less of an opportunity cost (and who give the senior person a throat to choke when things inevitably go wrong).
But it’s probably safe to assume that fewer junior people can wield these tools on behalf of senior people, that a lot of entry-level jobs will go away, and that on average, the people who own and manage companies will be better off than those they replace.
So in this more pessimistic scenario, what happens?
Joe Weisenthal, as usual, nails the crux:
What are the partners going to consume with their new savings? What will all rich people who get even richer consume with their new riches? Who’s going to supply it?
One place this line of questioning leads is that more people will start companies, which would be great, especially if they’re not all vibe coded software companies converging on different versions of the same thing.
A step beyond that, though, I think it leads to a Renaissance.
In the Future, Everyone Will Have a Guy (or an Army of Guys)
Warning: this is where the essay goes from analysis to educated speculation. Call it my right-brained attempt to pull together a bunch of seemingly disconnected threads.
So before we jump into the speculation, let’s recap:
Modern society has become overly left-brained. Measurement over meaning.
Conditions in the modern world mirror those of the pre-Renaissance period. Declining trust in institutions. Power vacuums. Concentration of wealth.
People are starved for beauty and meaning. Slop. Efficiency. Metrics. And a lot of questions about what it means to be a human.
The green → experienced pipeline is hollowing out. Young people need to work alongside experienced people to gain experience and tacit knowledge.
The challenges, as they often do, contain the seeds of the solution. And the solution looks something like this:
Successful people - rich and still young - can support teams of energetic young people, fluent in modern tools, to lead and carry out magnificent projects, from large public works to new scientific institutions. Fuck you money for the public good, which, in the process, gives these apprentices the experience, resources, reputation, and network to become masters themselves.
Let’s start with this: senior people don’t hire junior people for a specific skill, really. For a while, they hired for Excel, or Figma, or coding, or, back in the day, sculpting, or whatever. Really, the meta-skills they’re hiring for across all of these technical skills are youthful energy, fast brains, and the ability to figure things out, no matter how long it takes, because young people have more to prove, more time, and fewer obligations.
Next, let’s say that AI gets really good but not full-replacement-good. That means that rich people will need to hire young people to help them get the most out of these new tools, as they did with Excel, and these young people will have the ability to do more, as they did with Excel.
If researchers and entrepreneurs can’t figure out AI’s last-mile problem – going from AI having useful thoughts and capabilities to actually fully trusting it to carry work out end-to-end in the real world (and the real world can be digital or physical) – then this army of underemployed young people will serve as the execution layer between patrons’ ideas and their realization.
This is how work works, just abstracted a bit.
The more interesting question is what these people are going to be executing.
Now, obviously, not everyone is going to be doing this new thing. Some will be junior lawyers. Some will be junior investment bankers. Many will be entrepreneurs.
But I think the biggest new category is going to be apprentice.
Call it the Rise of the Guys.
Guys can, of course, be guys or girls. Their defining characteristics are energy, intelligence, and the ability to figure things out.
This is happening already.
Think of Luke Farritor, who went from interning at SpaceX to successfully reading the scrolls for the Vesuvius Challenge to working for Elon Musk at DOGE to becoming a full-time government employee in the General Services Administration. Farritor is clearly energetic, smart, and high-agency, and he’s picked up both tacit knowledge and reputation by being a Guy. The probability that he doesn’t parlay that into building his own well-funded thing rounds to zero.
Farritor is an extreme case, but guys are already becoming more common. Elad Gil, for example, employs some of the smartest young people you’ve never heard of working on projects that sound straight out of Renaissance Florence: “Monumental (coming soon!), a chain of new K-12 schools inspired by ancient Greece, two new foundation models I want to exist.”
Gil has had success both as an entrepreneur (Mixerlabs (acquired By Twitter) and Color) and as an investor, building Gil Capital into perhaps the largest solo VC in the world. He’s also written one of the most popular books on startups, High Growth Handbook, and co-hosts the popular AI podcast, No Priors.
With all of that going on, how can he take on building monuments, starting a school system, building two new foundation models, and translating the top 1,000 off-copyright books into all commonly spoken languages with Alexandria AI?
He has Guys.
In May of last year, Elad told Turner Novak about Monuments: “I'm in the process of looking for somebody to help do this because I don't have the time myself to do a bunch of stuff right now.” And about Ancient Greece-inspired K-12 schools: “And so this is another one where I would need somebody to drive it, and I'm very happy to sponsor that.”
He specifically tells Turner that these projects are both meant to be driven by young people and to inspire young people:
And then on the non-business side, there's these broader societal questions of how do you think about societal inspiration and how do you encourage people to work on important things and build important things? How do you identify young talent that could help a boost, could make a big difference for in terms of their future impact, things like that?
As of this February, Elad is teaming up with Sabrina Halper to make Monumental, which will build monumental public art projects in major cities, a reality.
I know a couple of the Guys working on Alexandria AI, and they’re incredibly good.
In each case, the Guys in question could get jobs with generous salaries and equity packages anywhere, and they’ve chosen to work on what are basically non-profits.
Which is very interesting. Probably a preview of the future. As Chris Dixon writes, “What the smartest people do on the weekends is what everyone else will do during the week in ten years.”
So why, given the flood of opportunities available to this group, are they choosing to work on Modern Magnificenza?
I think the first answer is pretty simple: they are the coolest possible projects to be working on.
When all of your peers are working on AI products, building monuments and schools and decoding scrolls and trying to fix the government stands out.
I suspect, too, that the combination of resources to do something big with the agency and responsibility to just go figure it out is attractive. Managing a too-big project end-to-end at a young age is both incredibly rewarding and a strong signal for future investors, partners, employers (probably rarely), and employees.
With better tools, like AI and eventually robots, each apprentice will be able to manage bigger and bigger projects. It will be their job to keep up to date with the new tools and figure out how to apply them to the problem at hand. AI in the right human hands can be an amplifier; but for many big projects, it’s not enough. Even Guys need to be able to call a Guy.
Third, at a time when computers can do more basic work, network becomes more important. By apprenticing with someone successful, apprentices get both direct exposure to someone they can learn from through observation, and access to that person’s network. While Elad might not have time to do everything himself, he has time to give advice and make introductions.
One of my favorite examples of this relationship is Jesse Michels. Hired by Peter Thiel to organize talks with heretical scientists at Thiel Capital, Jesse produced Eric Weinstein’s podcast, The Portal, before launching his own, American Alchemy. He built experience and a network – people were probably much more likely to respond to an email with a Thiel Capital email address than an email from some random guy - and proved his skill through deep curiosity, deep research, and strong storytelling skills.
Over the past few years, Jesse has worked himself into the center of the UAP and speculative physics universe. Last week, he went on Rogan.
Jesse, for his part, is as skeptical of reductionist materialism as McGilchrist is, and through his work, is doing as much as anyone I know to bring its questioning mainstream. He’s certainly had an impact on my thinking in this area; The Return of Magic was largely inspired by American Alchemy. The impacts of apprenticeship can spread far beyond the initial relationship.
In short, if you want to do something big yourself, there is no better training ground than doing something big with the support of a successful patron.
For their part, patrons need to excel at identifying high-potential young people, guiding them towards ambitious projects, and giving them the resources they need to succeed. They are, in the process, responsible for raising their ambition.
In my Hyperlegible conversation with Astera CEO Cate Hall, she laid out how this works at the multi-billion dollar private foundation she runs.
I want to share this in-full, because it captures what I’m trying to say so well:
So Astera is a private foundation. It was started a few years ago by Jed McCaleb. It's a large, multi-billion dollar private foundation that works on creating technology and science for the public benefit. So we do a bunch of different investing and grant-making activities.
We also run programs in-house that are about taking talented scientists whose work wouldn't have a home otherwise and bringing them here and sort of creating this community around them and really supporting them. And this is all in service of trying to create a new pathway for the creation of public goods in the world, which is traditionally a thing that government has done, maybe a little bit less now, but it's also a valuable complement to what industry is able to do, which I'm also a fan of. There are many things that industry is just not well-suited to do - different stages of development or commercialization, different industries where it's hard to extract value.
And so we are trying to support those activities, and we're also trying to - with this residency program, I think Paul Graham talks about the most important thing you can do is massively raise somebody's ambition. And so it's kind of that - it's kind of like "come here and we will help you think through how to be more effective in the world and how to find the best expression of this thing that you are really passionate about and the way that you want to see the world change.”
Astera highlights another flavor of Magnificenza, one very much like Lorenzo il Magnifico’s.
While Vesuvius Challenge, Plastic List, Monuments, and Alexandria AI say, “Here is something I want to see happen in the world, go make it happen,” Astera says, “If there is something you want to see happen in the world that doesn’t fit inside the traditional system, we want to support you in making it happen.”
Because Astera has billions of its own dollars at its disposal, it can create public goods outside of, and even in the face of, the established system. As we covered in the Weekly Dose, Astera and Arcadia Science’s Seemay Chou wrote last week that her organizations “are expanding our requirement that all scientific work we fund will not go towards traditional journal publications. Instead, research we support should be released and reviewed more openly, comprehensively, and frequently than the status quo.”
While many people have called out the flaws in the journal publishing system, Astera and Arcadia are in the position to just… build a new system. And in that system, scientists whose work might not traditionally get noticed – because it’s too weird, because they’re not attached to the right institution, because they’re too young – have a place to shine. More, because Arcadia and Astera mandate open, comprehensive, and frequent research releases and reviews, they’re creating infrastructure on top of which other researchers can build and publish.
No individual junior scientist, no matter how good, has the power to operate outside of the establishment on their own. But with billionaire benefactors, they might.
As you might have noticed, as we’ve progressed from Luke Farritor, to Elad Gil’s team of Guys, to Astera, we’ve expanded the number of opportunities for young people to do big, important work.
And I’ve just listed a few examples. There’s 1517. There’s the Thiel Fellowship. Another, which Aman and Sehaj shared with me, is Yuri Milner’s Breakthrough Initiatives, a $250 million effort to “investigate the fundamental questions of life in the Universe: Are we alone? Are there habitable worlds in our galactic neighbourhood? Can we make the great leap to the stars? And can we think and act together – as one world in the cosmos?”
Aman and Sehaj, two of my teammates at Not Boring, are themselves beneficiaries of one of the greatest attempts to identify and support young talent in the world, Tyler Cowen’s Emergent Ventures, having won Emergent Ventures India grants.
This form of modern patronage is expanding, both locally and around the globe, and I bet it will continue to expand.
Every billionaire will need a team of Guys competing to build magnificent public works and establish new institutions and infrastructure. It is becoming, and will become, the new status signal. And it will expand from there.
Magnificenza seems to be starting in Silicon Valley, where things often start, but these things tend to spread. Inspired, or goaded on by, the Medici, Venetian merchants increased their patronage of artists like Bellini and Giorgione. In Milan, the Sforza funded Leonardo da Vinci. Rome’s papal families (practically merchant princes themselves) commissioned Michaelangelo for the Sistine Chapel. Within cities, merchants competed with each other, but cities competed with each other, too.
Seeing what the billionaires are doing, the centimillionaire in the small town will want to revitalize their city, too. Seeing what the small-town centimillionaires are doing, millionaires will reconsider how they give to make an impact.
I think, as in Florence, there will be a tipping point, driven not just by moral good but by competitive dynamics.
One of the lessons from the Renaissance is that Magnificenza is good for patrons’ communities, their apprentices, and for the patrons themselves. The Medici name still stands for patronage and beauty 600 years on.
By enacting Magnificenza most successfully, they won the competition among the city-states and their leading merchant families: the Medici established Florence as the center of western intellectual civilization, established one of the world’s great Scenius, secured their legacy, and led the world into its right-brained peak.
What was good for Florence, and the world, was good for the Medici.
I suspect that, fuse lit, competition and necessity will drive a similar renaissance of Magnificenza in our modern world.
Funding grand public works, identifying the best young talent, supporting novel research, and commissioning great works of art, philosophy, and literature will be the status symbol that the Giving Pledge was meant to be. Magnificenza will be all the more signifying because it is more active.
As Andrew Carnegie wrote in The Gospel of Wealth, “Surplus wealth is a sacred trust which its possessor is bound to administer in his lifetime for the good of the community.”
Beyond status, Magnificenza will be a way to attract the highest-agency young talent. People want to work on Good Quests, whether by starting a startup, bringing beauty into the world, or both, the former en route to the latter.
It is also a way to rise above the noise. In an era in which attention matters more than ever, and is harder to capture, doing grand, novel things is a way to stand out. We must have written about Vesuvius Challenge at least three times in the Weekly Dose. Elad Gil’s projects are a way for him to separate himself from other GPs – as an individual, expressing his vision in the world. I would be shocked if both Nat Friedman and Elad Gil haven’t won competitive deals in part due to founders’ appreciation for their Magnificenza.
As the Experiment Foundation writes, “Forget ad spending, grant programs are the new marketing budget.”
If one way to gain attention in the world we’re entering is what Cluely is doing, creating controversy for eyeballs, then I will take the other way, the one where patrons earn attention for the things they build for the community. If they direct that attention for commercial gain, then the trend is all the more self-sustaining.
Finally, in some ways, Magnificenza is a form of self-preservation, for a newly elite group of tech wealthy who have been taking arrows for almost as long as they’ve been in power. If AI does cause social upheaval, labor revolts, and economic instability, this becomes critical.
I am as pro-Waymo, anti-burning Waymos as anyone (lock them up), but if we think the kind of sentiment expressed by this UC Irvine professor will get less prevalent as technology touches every corner of the economy, we have our heads in the sand.
Not Boring readers will know that profit and the public good aren’t at odds. Capitalism has given us longer, healthier lives, better jobs, and material abundance. But the more we can turn profits into public goods, directed by the very people whose talent and energy created the profits in the first place, the better the future will turn out.
Directly, it will turn out better because, as the Medici learned, building for the public good is the best way to earn public support. The people chanted “palle! palle!” in the face of an attempt to manufacture populist uprising. Modern Magnificenza may smooth the path to more Waymos, rockets, supersonic planes, and delivery drones, and stave off crippling government redistribution efforts.
Less cynically, though, Modern Magnificenza can provide the cure to many of the things that ail us.
Drivers whose jobs are displaced by Waymos can build monuments. Entry-level workers made redundant by AI can apprentice on more meaningful projects, and learn the meta-skills that will be crucial to thrive where we’re going. Patrons can amplify the ambitions of the most talented among us with support, apprenticeship, and networks.
Magnificenza isn’t a standalone solution, of course. Startups remain the driving force in the economy. Academia trains young thinkers. The government provides essential infrastructure and services.
But clearly something is missing, and Magnificenza can fill crucial gaps: it creates space for ambitious projects that don't fit neatly into existing categories, for research that's too speculative for academia but too foundational for startups, for young talent that needs seasoning but can't find meaningful entry points in an AI-optimized economy. It's the bridge between pure profit and pure charity, between individual ambition and collective good, between left-brain-generated wealth and its right-brain application.
During the Renaissance, Magnificenza was both symptom and cause of civilization’s right-brain tilt.
In modern times, too, I suspect that the proto-Magnificenza we’re seeing is a symptom.
Whatever its ultimate capabilities, AI has forced a reckoning on what it means to be human. It’s made us pause to consider what we think is good and beautiful, if only to say that AI’s output is not that.
The easier it becomes to build software and automate slop in pursuit of metrics, the more prestigious it becomes to build things with no care for returns. “In everything he will spend not for himself but for the sake of the work;” said Aristotle, “and the cost will be measured by the worth of the work, not by its owner's means.”
Separately, I’ve sensed a Return of Magic, a trust in intuition over numbers, a search for wonder instead of skepticism, and a very right-brained view of the “universe as alive, connected, and full of possibilities.” That there is a Meaning Crisis has been widely reported; over time, crises tend to resolve themselves. We will search for, and find, meaning.
I also believe that Magnificenza can be a cause accelerating the shift back to the right-brain.
Orienting people towards searching the world for unique and personal ways to express their beliefs in a way that brings civic benefits is orienting them towards a more holistic way of thinking. Actually building those things, bringing beauty into peoples’ lives and showing them that it’s still possible to build big, beautiful things might once again change how people attend to the world. It may make the world come alive with possibility.
We stand at a moment much like Lorenzo's Florence: after crisis, before renaissance. The infrastructure of the old world is crumbling. New forms of wealth and power are emerging. Change is coming. The question is what kind of change we choose.
Down one path lies Sutskever's machine world: humans as biological bootloaders, optimization over beauty, measurement over meaning.
Down the other lies magnificence: a world where wealth flows toward human flourishing, where young minds decode ancient scrolls instead of optimizing click-through rates, where cities compete on cultural vibrancy as much as economic metrics.
This is not an institutional decision, but an individual one.
If you’re reading this, it’s your decision.
If you have resources and experience, be a patron. Find a team of talented, driven young people and build something magnificent. That might be a monument, or it might be a public park. It might be a new research institution, or it might be a grant to support one person whose work you think needs to exist.
If you’re a talented, driven young person who’s worried about the job market, and who thinks you could, should, be doing more, be an apprentice. Find yourself a project you believe in and work like hell. Your future won’t be given to you, but you can take it.
There is beauty in the world, because people choose to bring it into the world.
The choice is yours.
Be magnificent.
Thanks to Aman and Sehaj for feedback!
That’s all for today! We’ll be back in your inbox Friday with a Weekly Dose.
In lieu of wedding gifts, Dan asks that you sign your business up for Ramp. What a guy. Even on his big day, he just wants you to save time and get profitable.
Thanks for reading,
Packy
2025-06-06 20:31:24
Hi friends 👋,
Happy Friday and welcome back to our 147th Weekly Dose of Optimism. Another action packed week of scientific breakthroughs across cancer treatments, gene therapies, and the ways in which science itself is conducted.
We won’t be covering the Elon/Trump drama, although our lawyers have advised us that we can no longer call ourselves a technology newsletter if we don’t at least mention it. So we will say this: we are happy to have Elon back focused on his companies (more on Neuralink below) with something to prove.
Let’s get to it.
ElevenLabs is one of the most magical products I’ve ever used. Backed by a16z, ICONIQ Growth, Sequoia, NFDG, and more, it’s the gold standard in AI voices. I think you’ll love it, and they keep making it better. Just yesterday, they released Eleven v3 (alpha), the most expressive Text to Speech model ever.
ElevenLabs makes AI voices that don’t sound like AI voices; the one they made for me, using just some old podcast recordings I had lying around, was so good that both of my parents thought it was actually me. Turns out I have a tiny lisp, and ElevenLabs captured it perfectly.
For developers building conversational experiences, that level of voice quality makes all the difference. It’s the difference between Uncanny Valley and a magical experience.
Their massive library includes over 5,000+ options across 70+ languages, plus, with v3, audio tags such as [excited], [sighs], [laughing], and [whispers], giving you creative flexibility.
ElevenLabs is powering human-like voice agents for customer support, scheduling, education and gaming. It saves me hours reading my own pieces to generate audio versions. With server & client side tools, knowledge bases, dynamic agent instantiation and overrides, plus built-in monitoring, it’s the complete developer toolkit.
Seriously, try it on your own voice, then dream up ways to incorporate it into your product. Start chatting with and building your own, unbelievably realistic AI voice agents for free today.
(1) Structured Exercise after Adjuvant Chemotherapy for Colon Cancer
Courneya et al in The New England Journal of Medicine
A 3-year structured exercise program initiated soon after adjuvant chemotherapy for colon cancer resulted in significantly longer disease-free survival and findings consistent with longer overall survival.
This may or may not surprise you at this point, but exercise is good for you. Across almost every measure of quality of life including happiness, healthspan, and mortality risk, it turns out exercise is crucial. And new research now shows that exercise may even help post-chemotherapy cancer patients live longer.
The new landmark phase 3 trial, called CHALLENGE, has shown that structured exercise significantly improves survival in colon cancer patients post-chemotherapy. The 900 patient study found that those in a three-year supervised exercise program had a 28% lower risk of cancer recurrence and a 37% lower risk of death over eight years compared to those receiving only health education materials. Basically, the risk of the cancer returning or causing death reduced by 1/3rd due to the exercise protocol.
Trial participants followed personalized regimens with goals of at least 150 minutes of moderate-to-vigorous aerobic activity per week and two or more resistance training sessions weekly. I am no doctor or even a personal trainer, but I’d bet that if they swapped out some of that cardio time for another 1-2 lifting sessions per week, results would be even better.
(Packy note: don’t besmirch cardio like that. long live running.)
Notably, however, even this protocol rivaled many standard drug treatments, with fewer side effects and lower costs.
Call somebody you love today and tell them to exercise.
Jagganath et al in The Journal of Clinical Oncology
One third (32/97) of patients remain alive and progression-free for ≥5 years after a single cilta-cel infusion, without maintenance treatment. Twelve of these patients treated at a single center underwent serial minimal residual disease (MRD) and positron emission tomography-computed tomography assessments, and all (100%) were MRD-negative and imaging-negative at year 5 or later after cilta-cel. To our knowledge, our data provide the first evidence that cilta-cel is potentially curative in patients with RRMM.
Researchers may have discovered a cure for multiple myeloma, a deadly blood cancer, for some patients. The treatment studied is ciltacabtagene autoleucel (cilta-cel), a personalized CAR-T cell therapy which involves collecting a patient's own T-cells, genetically modifying them to target the BCMA protein on myeloma cells, and infusing them back into the patient as a one-time treatment. While most patients with relapsed or treatment-resistant multiple myeloma die within a year, nearly 1/3rd of treatment recipients were still alive and cancer-free five years after treatment, without needing any ongoing therapy. Even more impressively, a subgroup of these patients showed no trace of the cancer, suggesting the disease was fully gone.
While this type of durable cancer remission in multiple myeloma has never been achieved before, it’s important to note that the initial treatment did not work for everybody: it was more effective for patients that had stronger immune systems, low initial tumor burden, and a healthy blood profile going into the treatment. That said, unlike other therapies that require ongoing drugs and still result in relapse, cilta-cel offers a one-and-done possibility. These results are the first real signal that a cure may be possible for some multiple myeloma patients.
Say it with me now folks: Get Fucked, Cancer.
(3) Neuralink raises $650 million Series E
From Neuralink
We’ve closed our Series E funding round of $650 million with participation from key investors…This funding will accelerate our efforts to expand patient access and innovate future devices that deepen the connection between biological and artificial intelligence.
Neuralink closed a massive round this week to double down on the progress its made over the last couple of years. The brain-computer interface company has indeed made some notable advancements since its last funding round of August 2023. Notably, during this time the company successfully implanted its first human device, enabled a paralyzed person to control a computer cursor with thoughts, built a custom surgical robot for precise implantation, achieved wireless data transmission from the brain, and received FDA approval for human trials. Elon’s companies move…fast.
I’ll admit it: I am super bullish on the work that Neuralink is doing. Could a cynic paint a scary picture of how a Musk-owned company is going to implant brain chips into every human and control their minds for evil? Sure, I guess there is a small probability of that occurring many years in the future. What’s much more likely, however, is that in the relatively short-term Neuralink is going to all-but-cure blindness, deafness, and any number of other severe neurological conditions. And in the longer term, it could enable the merging of human brains with super AI which would transform just about every way we humans learn, work, and communicate (and in my view, for the better.)
(4) Longevity Is Now a Factor When Picking an Embryo for IVF
From Nucleus
Nucleus plans to charge $5,999 for an analysis of up to 900 conditions, including diseases that occur later in life and are major causes of death in older people such as Alzheimer’s disease, heart disease and cancers. The company will analyze up to 20 embryos. The embryos are given probabilities for the likelihood they will get these chronic conditions. It is up to the parents to decide the qualities most important to them when choosing which embryos to use.
In a world-first, Not Boring Capital portfolio company Nucleus has launched Embryo, a genetic optimization tool that lets IVF parents rank and select embryos based on a complete genomic profile, from disease risk and cancer predisposition to traits like IQ, height, and eye color.
It works by analyzing the genetic data of IVF embryos to assess risk for over 900 diseases and dozens of traits. The analysis combines Mendelian analysis (for rare, high-impact mutations) with polygenic risk scores (for common, complex conditions) and adjusts predictions based on ancestry and assumed adult risk factors. It spits out a ranked, science-backed embryo profile that helps parents make informed decisions during the embryo selection process of IVF.
Embryo is already live, with early adopters using it to guide choices including, in some cases, selecting embryos with lower predicted risk and higher estimated intelligence. While still early and not without controversy (Kian is very good a garnering attention for his company!), the launch marks a major step toward applying consumer genomics to reproductive health. Nucleus is building out its suite of products (Family, Embryo, Health) that unlock genetic information to live longer, healthier, and perhaps even better lives from pre-conception to grave.
It’s important to note, and Nucleus does, that its tests can’t guarantee anything. They deal in probabilities. But with embryos already screened for certain diseases and genetic conditions, Embryo expands what parents can understand about their future children. As we discussed last week when we covered Orchid, “our perspective is that we’d of course rather have the technological capability of doing these things and wrestle with the resulting ethical dilemmas of whether or not we should do these things, than to not have the capability at all.”
Kian broke it all down with Molly O’Shea in this interview on Wednesday. My man has one of the most genetically optimized jawlines you’ll ever see.
(5) Scientific Publishing: Enough is Enough
Seemay Chou for Human Readable
I no longer believe that incremental fixes are enough. Science publishing must be built anew. I help oversee billions of dollars in funding across several science and technology organizations. We are expanding our requirement that all scientific work we fund will not go towards traditional journal publications. Instead, research we support should be released and reviewed more openly, comprehensively, and frequently than the status quo.
Arcadia Science and Astera Institute are no longer funding science built for scientific journals. The two institutes are shifting away from traditional scientific publishing, arguing that the current model distorts research incentives and slows progress. In her essay, Astera’s cofounder Seemay Chou explains how journals prioritize prestige and polished narratives over truth and transparency, leading scientists to selectively report results and delay data sharing. This creates artificial bottlenecks, discourages collaboration, and blocks real-time feedback and reuse. Incentives shape the world, folks.
So what are Arcadia and Astera doing instead? Only funding research that is shared openly, frequently, and transparently, prioritizing real-time feedback, full data access, and iterative publishing over prestige-based narratives. Scientists are encouraged to share failed experiments, raw data, and in-progress work, making science more reproducible and useful. And the early results are promising: faster peer review, more creative and rigorous science, and stronger collaboration.
We’re big fans of Arcadia and Astera here at Not Boring. Earlier this week, Astera CEO Cate Hall went on Hyperlegible to discuss her essay, Crossing the cringe minefield. In the discussion, she explains that the work Astera does “is all in service of trying to create a new pathway for the creation of public goods in the world, which is traditionally a thing that government has done.”
And way back in October 2022, in Gassing the Miracle Machine, Elliot Hershberg wrote that “Arcadia is an applied experiment in metascience.” This is a hell of an applied experiment. Arcadia and Astera are betting that playing with the way we share and build off each other’s knowledge might be the most impactful experiment of all.
We look forward to covering some of these non-journal results in future Doses.
BONUS: Elliot Announces $200M Amplify Bio Fund
Packy here. Yesterday, our friend Elliot Hershberg announced that he’s joining Amplify to help build their new $200M fund dedicated to technical founders in bio.
Over the past three years, Elliot worked with me as the Biotech Partner at Not Boring Capital. The plan was: work with me while getting his PhD, get it, and then launch his own small early stage bio fund.
Everything was going according to plan. He led our investments in some exceptional biotech companies including Atomic AI, Unnatural Products, Decade Bio, Cromatic, Neion Bio, Digital Bio, Convoke Bio, Fletcher Biosciences, Biodrive, Exthymic, Euler Biologics, and Sculpta. He wrote pieces like Medicine’s Endgame and Gassing the Miracle Machine, and we worked together on Deep Dives for Atomic AI and Varda. In February, he successfully defended his PhD at Stanford.
One thing didn’t go to plan, though. The market realized what I realized about Elliot getting to work with him closely for three years: he is going to be one of the best investors in biotech, and he should probably be running a larger fund than the one he was planning to run.
Elliot is a rare combination of skills and traits. He combines the rigor of a scientist with the ability to dream like a writer. He’s a biologist and a computer scientist. He’s as thoughtful about fund strategy as he is about clinical strategy. He’s a deeply curious student of whichever game he’s playing. And he connects with biotech founders, who are a different animal than traditional tech founders, in a way that consistently impressed me. I always like to be the dumbest person in a room, but I never felt dumber than when in conversation with Elliot and a biotech founder, and I loved it.
I wasn’t the only person who realized this. I can’t count the number of firms that tried to poach Elliot over the past few years. And as we discussed whether he should take this or that offer seriously, we kept coming back to: it’s tempting, but Elliot has a distinct point of view on biotech investing and writing, and should build his own firm to reflect that point of view.
Then Sunil Dhaliwal and the Amplify Partners team offered him the ability to do just that, with more scale, resources, and teammates than he would have had on his own. Amplify has been one of the best investors in developer tools and infrastructure for over a decade, partnering with “technical founders who would rather write code than PowerPoint.” Along the way, they backed technical founders in bio — Chris Gibson at Recursion, Brandon White and Alex Beatson at Axiom, Nima Alidoust and Johnny Yu at Tahoe Therapeutics, Zvonimir Vrselja and Nenad Sestan at Bexorg, and many more — and they decided it was time to build a dedicated Bio fund. They realized (geniusly, in my opinion) that Elliot was the perfect person to help them build it.
In the Weekly Dose, we often cover breakthroughs in biotech. In the past month alone, we’ve covered multiple miraculous gene therapy breakthroughs. At the same time, it’s been a weird market for investing in biotech companies. Elliot believes and has written many, many words on the idea that this is going to be the Century of Biology. As he writes in the Amplify Bio Manifesto, bio is at the same place tech startups were almost two decades ago, with the infrastructure in place to take really big swings: “Equipped with rented lab benches, cheap cloud compute, and tremendous grit, we believe these brilliant technical founders have the potential to build generational companies.”
I think that Elliot is going to back a disproportionate amount of those generational companies, and that his portfolio will be responsible for making all of our lives longer and healthier. I’m excited to personally be a small LP in Amplify Bio.
When people ask me how I plan on building out the Not Boring Capital team, I always point to Elliot as the prototype: someone with technical depth who can write, someone so talented that it would be impossible for a small fund to hire them full-time, but who I could team up with and learn from part-time while they also pursued other goals (in his case, the PhD). Even as I said it, though, I knew that it would be incredibly hard to find Elliots. The guy is a unicorn.
That said, getting to work with Elliot has been one of the highlights of my career, and I think the most interesting way to build out the Not Boring Capital team is through ephemeral partnerships that turn into a strong network as people go on to run their own funds. So if you’re deeply technical in a category I care about, tell stories that your industry trusts, and want to become a world-class investor while pursuing the thing that keeps you close to the metal, my inbox is always open. You’ll have big shoes to fill.
Have a great weekend y’all.
Thanks to ElevenLabs for sponsoring. Go get yourself (and your business) a voice. We’ll be back in your inbox next week.
Thanks for reading,
Packy + Dan
2025-06-02 20:33:21
Welcome to Episode 010 of Hyperlegible, a Not Boring Radio production.
To find all of the excellent essays we’ve discussed on Hyperlegible, head to Readwise.
Crossing the Cringe Minefield with Cate Hall is live: YouTube | Spotify | Apple Podcasts
Cate Hall is the CEO of Astera, one of my favorite multi-billion dollar private foundations, and one hell of a writer.
If you've noticed the word "agency" popping up all over the place recently, you have Cate to thank. Her 2024 essay, How to be More Agentic took the internet by storm and brought agency into the zeitgeist, where it has remained and grown. Now, she's even writing the Book on Agency, which you can sign up to pre-order here.
On the first episode of Hyperlegible with Tina He, when I asked who people should read more of, Tina recommended Cate.
So I was excited to see Cate drop a new essay that felt like it was written at me (and I think will feel like it was written at you, too) called Crossing the Cringe Minefield:
Like Tina said, Cate is really good at directly saying: this is how this works, and this is how to deal with it. She does that in the essay, and we expand on it in the conversation.
When we want to improve ourselves or our station in life, she argues, we start with the things that come naturally, the easy wins. They don't work. Then, we try things we don't love but don't hate. Those don't work, either.
Finally, we're faced with a choice: give up, or do the thing that feels deeply, incredibly uncomfortable, the thing that makes us cringe. That's where the answer normally is, because the cringe is a sign that we've left that area of ourselves under-developed.
“This means," Cate writes, "that existential cringe is actually a signal pointing you to where you can make the most progress quickly."
We all have something we want to get better at. We all have something that makes us cringe to even think about. And unfortunately for all of us, those two are intimately related.
While people have always felt irrational fear and shied away from doing uncomfortable things, letting cringe dictate our lives is a modern luxury. It’s part of the mechanism behind good times creating weak men. To avoid something because it feels a little scary is something that only a comfortable society can afford.
In her excellent book, Antimemetics: Why Some Ideas Resist Spreading, Nadia Asparouhova writes, “‘Cringe,’ a term that originated in tandem with the rise of social media, is a uniquely modern concept that refers to doing something that you misjudged as socially acceptable, which then evokes embarrassment from others.”
The cringe Cate writes about is an evolved version, an anticipatory cringe, almost drunkenly believing that a thing that won’t actually be cringe to others will be, preventing you from actually doing the thing. In either form, it’s a dangerous emotion.
Societally, Nadia writes, “Before cringe, people just....tried things, some of which landed, and some which did not.” Personally, Cate points out cringe has the same effect: preventing you from trying things and even discovering which will land and which won’t, and learning that even the ones that don’t land don’t hurt as much as you expect.
So, we must kill the cringe. For ourselves, and for society.
At one point, I mentioned that essays like How to be More Agentic and Crossing the Cringe Minefield seemed far afield from her day job running Astera, but she disagreed. Astera is a large, multi-billion dollar private foundation that works on creating technology and science for the public benefit through investing and grant-making. Part of the job is finding talented scientists and convincing them that they can do more than they realize.
“Paul Graham talks about the most important thing you can do is massively raise somebody's ambition,” Cate said, explaining that the Astera residency is, “Kind of like ‘Come here and we will help you think through how to be more effective in the world and how to find the best expression of this thing that you are really passionate about and the way that you want to see the world change.’ And I think that that is also what I'm trying to do with my writing.”
Cate’s writing, then, is a gift that I’m thrilled to share with the Not Boring community, because if all of us become more effective in the world, find the best expression of the thing we’re really passionate about and the way you want to see the world change, a lot of good things will happen.
We talk about how to do that and more, often in the form of a quasi-personal coaching session that I think applies to many of us.
If you're like me and have been avoiding something that makes you cringe, this conversation might be the kick in the ass you need. Or at the very least, it'll help you understand why you've been stuck in the same patterns. Either way, Cate is worth the listen (and the subscribe).
Links to a transcript, YouTube, Spotify, and Apple Podcasts are right down below so you can listen early and often.
[3:37] Cate summarizes "Crossing the Cringe Minefield"
[5:48] Why this essay resonates universally (and why your 30s aren’t too late)
[7:20] My personal cringe around asking for help
[8:15] Why cringe exists - the "hot stove" analogy for psychological patterns
[10:53] How cringe distorts your sense of proportion in normal situations
[12:19] What percentage of people actually overcome their cringe (less than 1%)
[13:40] Whether naming your fear publicly makes it easier to face
[15:54] How to identify your cringe using the Enneagram system
[22:06] Why personal vulnerability in writing creates audience connection
[23:23] How Astera's mission connects to Cate's writing on agency
[25:57] Whether Cate kicked off the "agency trend" before it was cool
[27:38] Coaching session: applying agency principles to Enneagram 7s
[32:49] The "gift of desperation" - how addiction led Cate to higher agency
[34:29] What it feels like to be high agency - seeing constraints as arbitrary
[35:39] The challenge of figuring out what you want once you can do anything
[37:05] Facing cringe is more agony than thrill initially
Final takeaway: [40:31] "The places where you feel existential cringe are where you can make the most progress as a person really quickly"
Ramp: the official Business Card of Not Boring.
Rox: AI agents to help your best sellers sell better.
Vanta: easy compliance for startups who want to grow their revenue.
Readwise: the best software for smart, curious readers.
If you’re the reading type, I used Claude to turn the messy YouTube transcript into something well-formatted and clean:
TRANSCRIPT: Crossing the Cringe Minefield with Cate Hall (Hyperlegible 010)
As always, you can find the full conversation wherever you like by subscribing to Not Boring Radio:
YouTube:
Spotify:
Apple Podcasts:
While you’re there, give us a like, comment, and subscribe so we can bring great essays to more people.
You can also find links to all of the essays and conversations at readwise.io/hyperlegible. Thanks to our friends and sponsors at Readwise, you can head there for a free trial and get all Hyperlegible articles automatically added to your account.
A recent episode that’s gotten a lot of good feedback is my conversation with Reggie James on his essay, A tale of two Vaticans (or, OpenAI building an unholy spirit), in which we discuss some of the things that have taken up more of my thinking since writing The Return of Magic.
If you want more to read, here are two of Cate’s reading recommendations, two of her own on agency and one on dreams. Save them to Readwise and come back to them:
Cate’s favorite essay she’s written:
Sign up to learn when Cate’s book on Agency is available for pre-order
One essay Cate thinks more people should read:
Dream Mashups by Malcolm Ocean
Big thanks to Cate for joining me, and to Jim Portela for editing!
Thanks for listening,
Packy
