Big Tech’s antitrust cases are starting to feel like Groundhog Day

Today on Equity, we're digging into the week’s headlines, from browsers and search to AI and social, and why Google and Meta's antitrust cases have us wondering if they’re really breaking up monopolies or just passing the baton to the next dominant player. Listen to the full episode to hear about: Tesla’s massive 71% profit drop and how Elon Musk is doubling down on Tesla and AI How Mati Carbon took home the grand prize from this year’s Xprize Carbon Removal competition Vibe coding, Cursor, and which AI-powered coding tool OpenAI has its sights on acquiring next The $91.5 billion raised by U. S. startups in Q1—and why more than half of it went to just 10 companies Equity will be back next week, so stay tuned! Equity is TechCrunch’s flagship podcast, produced by Theresa Loconsolo, and posts every Wednesday and Friday. Subscribe to us on Apple Podcasts, Overcast, Spotify and all the casts. You also can follow Equity on X and Threads, at @EquityPod. For the full episode transcript, for those who prefer reading over listening, check out our full archive of episodes here. Credits: Equity is produced by Theresa Loconsolo with editing by Kell. We’d also like to thank TechCrunch’s audience development team. Thank you so much for listening, and we'll talk to you next time. Learn more about your ad choices. Visit megaphone.fm/adchoices

Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

• 0:00Anthony Ha?

  This episode of Equity is brought to you by Schneider Electric. Schneider Electric, advancing energy tech.

• 0:16Kirsten Korosec?

  Well, I'm here just for the vibes. That's it. No business talk. Because really, what I've found is that especially with covering Tesla and looking at how the stock market reacted to like a 71% decrease in its profits and yet stock going up, it is vibes. It's just all vibes.

• 0:35Anthony Ha?

  Yeah, I felt like I was going insane because I remember seeing the first wave of sort of posts where they're just like, oh, my God, like, this is like a brutal, brutal quarter for Tesla. And then immediately going to like Yahoo Finance and then seeing that the stock was up and it was so confusing.

• 0:48Kirsten Korosec?

  Yeah, so if you look at the fundamentals of the present business, 71%, you know, down on profits, you look at automotive revenues down year over year. Energy business actually kind of did, did okay. It grew, but it's small. And also, by the way, like the most vulnerable to tariffs. So we'll see how that goes. And the stock market reacted to the, you know, put your galaxy brain on the future. So Elon saying, hey, I'm going to step back from Doge. Hey, I'm going to allocate more time to Tesla and AI, AI, AI, Cybercab, robo-taxi, cheaper EV models.

• 1:31Anthony Ha?

  Of course.

• 1:32Kirsten Korosec?

  None of these things that actually are commercial yet, but, but yeah, like, you know, vibes. And this is the, what was so interesting to me. So the market reacted and a lot of media paid attention to how Elon was like stepping back from Doge. But he also said he was willing to stick around through the entire Trump administration, which is new. That's actually an escalation of commitment.

• 1:56Anthony Ha?

  I mean, we'll see if he actually does it.

• 1:58Kirsten Korosec?

  TBD.

• 1:59Speaker 02

  The part that I think investors were reacting to was he said, you know, I'll be stepping back in some way. But right. He also said he's going to stick around with the administration. But it's just shocking that like, like, I don't think we've seen any evidence that returning to office is more valuable for companies as opposed to remote work, except for Elon Musk returning to office. When he returns to office, that's a $50 billion raise to Tesla's market cap. Any other company, doesn't really matter.

• 2:28Kirsten Korosec?

  Because when he goes back to office, Max, he doesn't just go back to the office. He sleeps in the office. He becomes the office. He literally becomes the couch, right? But I digress. Hello and welcome back to Equity. That's what you're listening to. TechCrunch's flagship podcast about the business of startups. Today is Friday, April 25. I am Kirsten Korosec, Transportation Editor at TechCrunch.

• 2:49Speaker 02

  I'm Max Zeph, a senior reporter with TechCrunch.

• 2:52Anthony Ha?

  And I'm Anthony Ha, Weekend Editor at TechCrunch.

• 2:55Kirsten Korosec?

  So on the show today, sans Tesla, we do have a bunch of other deals to talk about. XPRIZE Carbon and some insider details on OpenAI's acquisition of Windsurf. And then we're going to get into updates on the Meta antitrust trial and pick through some Q1 venture figures. So let's get on with that first deal.

• 3:15Anthony Ha?

  Right. So this is the XPRIZE Carbon Award, and it went to this company called Mati Carbon, that's spelled M A T I. I should also just say that like, I watched a YouTube video while we were preparing for this episode to get the pronunciation, but then did the classic thing where I was like, wait, oh, no, now I don't remember which one in my head was correct. But it's M A T I, Mati Carbon, and they got a $50 million prize for basically working with farmers on capturing carbon. And weirdly enough, this actually ties back into our previous discussion, because this is also, the XPRIZE Carbon Award is actually funded by the Musk Foundation.

• 3:49Kirsten Korosec?

  Oh, yes, that's right. I always forget that they, you know, his hands are in a lot of things. And I had kind of forgotten about this. And it's so interesting because I really haven't been hearing too much about climate tech investments. I mean, we, of course, cover it here. It's certainly still happening, but there's so many other deals and sector areas, AI being that the big one that just gets the bulk of attention. And I, you know, we covered the XPRIZE Carbon Award, but what's your sense of how important this is to the climate tech industry?

• 4:27Anthony Ha?

  I mean, I, I noticed that there was other coverage, but it was all from the Musk angle because it's like, put Elon Musk's name in a headline right now and it becomes kind of interesting. I mean, this is like a pretty sizable prize. This is $50 million. And the company does seem like pretty cool. It's basically taking basalt and working with farmers to kind of ground up basalt and then help them kind of cover their fields in the ground up rocks, which will both capture carbon and also is like good for the farms because it helps with fertilization and with water retention. So it seems kind of like a win-win situation. I mean, one thing that I do wonder about is that their model is based on carbon credits,

• 5:09Anthony Ha?

  right? And the idea that basically companies are going to fund this to get carbon credits. So that relies on the assumption that there's still going to be a healthy market for carbon credits in the years to come.

• 5:20Kirsten Korosec?

  Well, I hope for Tesla's sake it is because, see, dang it, I thought we were going to be done talking about Tesla. But if you go back and look at their first quarter earnings, they're brought in $595 million in the first quarter from selling regulatory credits. So that's a market that matters for Tesla. In fact, if you looked at their net income, they would have had a net income loss under a GAAP accounting practices, but it would have been a net loss if they hadn't had that. So regulatory credits do matter. They matter for quite a lot of businesses, Tesla being one. And in the climate tech sector, it is an area where, you know, companies can potentially generate revenue and build a business.

• 6:03Anthony Ha?

  Right.

• 6:03Speaker 02

  You know, it's interesting to me that like in 2025, you think we're going to have these advanced solutions to improving the environment and yet the the real thing that's going on is companies are continuing to operate in the same kind of wasteful ways that they do. And then they pay Matty to basically grind up rocks and throw it on the dirt, which I think is a really fascinating kind of just place where we're at for saving the environment. However, I think one thing that is noted in this story is like you mentioned, Anthony, this platform for selling carbon credits, which which they think is going to be a real driver for them. And maybe it is.

• 6:41Anthony Ha?

  Right. So it's like, part of it is like the idea of like connecting these farmers, you know, including like farmers in Africa to this carbon market that presumably they, you know, a lot of them would not really have access to otherwise. I think one other thing that's like interesting about the company, and this is like a B Corp, but like that's controlled by a nonprofit. And it sounds familiar, like some of the other companies we might be talking about later on. But they also say like, you know, because they are mission driven, they'll also make some of the software parts of the platform available to other companies that wanted, as long as they're willing to sort of share their profits, like 50% of their profits with the farmers themselves, then they can get access to the Matty software for free.

• 7:22Kirsten Korosec?

  No, that is interesting. I'm wondering if you have any sense of other companies either going after the same market? I mean, I do think it's interesting that you mentioned Africa, which is potentially in terms of sustainability in regions that are particularly vulnerable to climate change. I mean, that seems like a really good market. Are you seeing either competitors doing what Matty is doing or actually like moving some of this interest in tech into the US market at all? Or is it really focused on Africa?

• 7:54Anthony Ha?

  I don't know about the geographic side. I mean, it did seem like in terms of just the other companies that were sort of runners up for the prize, that there was some similarity, including like a company called Undo Carbon, which is also trying to do like use rocks for for carbon capture. So it does seem like an area where there is interest. Yeah, I'm not sure about the geographic side.

• 8:12Kirsten Korosec?

  Well, actually, you know, we really should have Tim Deschamps on the show one of these days, who's a climate tech reporter who knows all this stuff inside and out. We don't have time for that today. But Max, please take us inside the OpenAI deal acquisition of Windsurf, because apparently, which I didn't realize, they were looking at Cursor, which is the product under AnySphere, right?

• 8:38Speaker 02

  Correct, correct. Yes. So for those who don't know, Cursor is the most popular vibe coding tool out there. And, and just for a second, what is vibe coding? Basically, you use a chatbot on your computer to say, hey, can you make me an app that looks like Google Earth, or something like that? And it will basically execute all of this code for you and create this code base that can replicate it for you. So you can effectively code without needing to actually have any knowledge of coding. And that's an oversimplification of it to an extent. But it's, it's a tool that's become really popular in big tech companies. It helps people kind of solve errors, check their work really quickly, kind of do repetitive

• 9:20Speaker 02

  tasks. And this is a tool, Cursor, that that has been just growing dramatically. And there's other competitors, like Windsurf is the second largest in the space. And there's also Poolside. So there's a lot of these popping up. And Opening Eye is trying to buy one of these startups. So we reported that OpenAI tried to acquire Cursor originally, but those talks were just early and they broke down quickly. And now they're in active discussions to acquire Windsurf here. We were not the only ones to report on this, but we got some new numbers on their revenue of these coding startups, which, which I think is, really shows a lot about why OpenAI is interested here.

• 10:00Kirsten Korosec?

  So what's the revenue? So are you gonna, yeah, I was like, are you gonna leave us hanging? Or what's happening here?

• 10:05Speaker 02

  It's a great question. So I mean, so Cursor's revenue, their ARR right now is about $300 million. So in a year, they're going to bring in 300 million. Windsurf's ARR is about 100 million. And this is according to our sources. So I would say that neither of these, on their own, are quite large enough to be a significant impact on OpenAI's overall revenue. They're bringing in over $10 billion a year. Next year, they're trying to double that to be more like 25 billion. But the real significant part is how quickly Cursor and Windsurf's revenues are growing. We reported that Cursor's revenue has been growing, it's been doubling almost every

• 10:47Speaker 02

  month or two. I mean, it's just like really dramatically getting more popular right now. And OpenAI is really looking to get into this kind of application layer to increase its revenue because the prevailing knowledge for the last couple of years has been that they would just build these AI models. They would just build this technology and sell access to it to companies like Cursor and WinSar. And what's happened is that's not actually as profitable as selling someone a $20 a month subscription to it. So they're really doubling down on this subscription model, which is just fascinating.

• 11:18Anthony Ha?

  Right, because I mean, I think that there's this sort of view on the sort of VC and startup side of the AI ecosystem that, listen, it'd be kind of crazy to try to build a foundational model at this point. There's sort of a handful of like big players they're going to build, and the opportunity for startups is to sort of build at the application layer, like, you know, using one or multiple of these models. And then it starts to get more complicated when if OpenAI, like the biggest company there is, is now starting to get into the application business itself. If I were a startup, I mean, on the one hand, you're like, oh, like, maybe I could like get acquired by OpenAI for like a ton of money. That'd be great. But like, oh, am I also now going to be competing more directly with them too?

• 11:57Speaker 02

  Yeah, exactly. I mean, so one of the things that we reported in here that hadn't been reported before was that Cursor, actually, sources close to the company told us that Cursor was the one who walked away from the OpenAI acquisition talks, which is like, why would you not want to join the hottest tech company on earth right now? And basically, what people told us is that Cursor is on this insane trajectory right now, and they don't want OpenAI to basically soak up their potential. Their valuation today is not what they think their valuation could be next year or two years from now. One question here is with the vibe coding startup that gets acquired by OpenAI. It seems like OpenAI might have them just use their own, OpenAI's own coding

• 12:42Speaker 02

  models. And OpenAI's models, while they were, once were the state of the art for coding, now Anthropic and Google's models are better. So actually being able to keep that kind of independence and variability seems really important for these guys right now. So we'll see what happens with Windsurf. Will OpenAI take out Cursor if they had Windsurf under their belt? I think that remains to be seen. I think Cursor is betting that they can actually compete here.

• 13:06Kirsten Korosec?

  I actually give Cursor a little slow clap, little kudos for, you know, standing their ground. I don't know if it's going to work out for them, but you know, good on them to see like, hey, we have some growth here. Let's actually stay in the marketplace. And competition is a good thing, you know, there, I do think that there's this risk where we get this homogeneous market when, you know, the giants and OpenAI being one of them just gobbles up everything. And in either like an aquahire form or, you know, more significant acquisitions, you know, I always love to somehow turn this around to a conversation about autonomous vehicles, but that is a form of physical AI. And, and I will say that during the hype cycle of autonomous

• 13:50Kirsten Korosec?

  vehicles, which I feel like we're kind of back in that realm again, but back in like 2017, 2018, we saw the same thing where these companies were popping up, putting autonomous vehicle or AI in their pitch decks, getting acquired, aquahired, and that was a thing. And there were a few that tried to stand their ground and go their own way. That didn't turn out great for a lot of them. The ones that exist today are because they were acquired by a much larger tech company, but there is some semblance of a little bit of competition, five, six years later, just way fewer players. So I'm very curious to see if this is the same thing that

• 14:30Kirsten Korosec?

  happens. We are not totally done with OpenAI just yet. The company's even setting its sights on Google Chrome. More on that after the break.

• 14:46Anthony Ha?

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• 15:13Speaker 02

  We were just talking a lot about competition in the AI space, and we're going to keep on talking about competition here because the DOJ is trying to break up Google for being too dominant. They're also trying to break up Meta for being too dominant in their respective domains. Anthony and Kira, so we've seen a lot of interesting details come out of these cases. I'm curious what stuck out the most to you.

• 15:34Kirsten Korosec?

  Well, before I let Anthony jump in on that, because I'm sure he has all these tidbits, I just want to say it feels a little bit like Groundhog Day in terms of going after Google for being too dominant in search ads. So just want to put that as a boilerplate foundation. So I'm curious to see if anything actually comes out of this one. But yeah, there's been some really interesting little tidbits that have come out of these trials.

• 15:58Anthony Ha?

  Right, and we should say, I mean, when you say it's Groundhog Day, part of the reason is because actually Google lost a different antitrust case last year, which that is still sort of working its way through the courts of like what the judge is going to try to actually make Google do. And then once the judge decides that, Google's probably going to appeal. So there's going to be this whole separate process. And so you're going to see headlines about both one antitrust case from last year that's continuing and this new case that's focused on the advertising side. I mean, I think that like one of the things that you alluded to earlier that is fun, I mean, I it's sort of not sure how seriously to take this, but someone from OpenAI did testify this week and said that if Chrome were on the market, OpenAI would be interested in buying it.

• 16:42Kirsten Korosec?

  OpenAI is just buying everything. And by the way, doesn't that present like a whole other problem of like another dominant player? I'm not sure if that solves the the issue there. It just shifts, it just, you know what it does? It just kicks it down the line and creates another bigger player, but it would solve, I suppose, a problem for Google. But I seriously doubt that they would sell Chrome.

• 17:03Speaker 02

  I mean, I think that OpenAI was trying to make the case that looked like they are being anti-competitive here. Like, it kind of ended up sounding like we would be the next monopoly if you let us, if you gave us that choice. Perplexity, executive from Perplexity also went on stand and said that they would be interested in buying Chrome too. I am much less seriously considering Perplexity's offer here, considering that Perplexity also offered to buy TikTok and-

• 17:27Anthony Ha?

  They make a lot of offers in the press. And I, you know, having like, you know, a lot of that's kind of breaks over the weekend and had some interactions with them over and they just, I mean, it's not to say that these aren't serious offers, but I think all of these offers are also PR for Perplexity.

• 17:41Kirsten Korosec?

  So cynical, Anthony.

• 17:44Speaker 02

  Perplexity is interested in being in the headlines. They're interested in maybe buying these things too. But, but I think that like what we're seeing in these cases is really just, particularly with Google, just, it seems likely that some remedy is going to be found in this case. Whether they spin off Chrome, it remains to be seen. But the implications of something like that would just be huge for the search market, for the AI market. I mean, someone like OpenAI, Perplexity, all these companies, I think, could have huge gains to be had if Google was to be spun out in these different ways.

• 18:20Anthony Ha?

  Right. And I mean, I think what you're also alluding to is that we're at this very dynamic time in the sort of web browsing slash search, which I mean are distinct things, but obviously for Google, they're tied together. And like, there's this sense that AI has begun to transform search. What is that actually going to look like? I mean, certainly, I think in Google's case, it has not been a home run in terms of improving their product. And so, and then that's part of the argument, I think, that Google is making across these cases, like, listen, we're not actually that dominant. I mean, of course, any company that's basically facing an antitrust trial wants to make the argument that they're not that big a deal, at least in that context, because then they don't get broken up. But I think in this case, there is like, at least certainly a pretty strong argument that Google

• 19:04Anthony Ha?

  is not by default just going to dominate, you know, search and the web for the next 10 years.

• 19:10Speaker 02

  Yeah, I wanted to call out another detail that came out of this that's related. Google ended up unveiling a slide in this case this week that showed their user metrics for Google Gemini, their AI chatbot. And what it revealed was that Google Gemini has 350 million monthly users. Compared to ChatGPT, Google's own estimates that were revealed in the case, they guessed that ChatGPT has 600 million monthly active users. And Meta says that its AI chatbot has around 500 million monthly users. So you're starting to see, like, these are the big three in this space. And this is kind of where everyone thinks the puck is going for search. It's moving to these AI chatbots that are more dynamic. But you're seeing that Google is not the most dominant here.

• 19:53Speaker 02

  They've dominated search with Chrome and they've dominated web browsing for the last, you know, 15, 20 years. But that's just not the world we're going in. So it's really hilarious to see OpenAI get on the stand and say, we would take that too. You'd see that would clearly create an entirely new problem for the next generation.

• 20:12Kirsten Korosec?

  Yeah, this is like the perfect segue to kind of talk about Meta's antitrust case. Because that is really like looking back into time about how future tech acquisitions are judged or might be judged. And so in Meta's case, there has been a lot of FTC questioning around, you know, WhatsApp and the Instagram acquisitions. And it could inform, of course, future acquisitions that OpenAI wants to make. Because to your point, OpenAI is actually, if those numbers that were presented in the Google trial are accurate, it would show OpenAI as the dominant player, right? And it shows Google as a fading power. And that's a pretty good argument for Google.

• 20:56Kirsten Korosec?

  But moving to the Meta's antitrust trial, there were some interesting tidbits that came out of there. They weren't gossipy because these were folks who were on the stand. But it had that element to them because we got to look back in time at those acquisitions and The one that kind of stood out to me was the co-founder of Instagram testifying that Instagram was sort of starved of resources after Meta bought it because Mark Zuckerberg was afraid of the success of Instagram, which was like, I guess we could all go, well, yeah. But I don't know, to me, that was like a surprising detail and I, I hope that other startups out there, like the cursors of the world, remember that, that,

• 21:40Kirsten Korosec?

  you know, sometimes you get the money in the acquisition, but you end up getting starved of resources and getting choked out and it doesn't, you, you lose control over that.

• 21:48Anthony Ha?

  Right. Although Instagram is like an interesting case because obviously like, if we look at Instagram now, it is not a startup that sort of died after the acquisition, like far from it. Like I think that in a lot of ways, Facebook now relies on Instagram as this huge chunk of its user base, a huge part of its business, you know, and an app that is in many ways sort of more like culturally relevant than Facebook itself. But yeah, it was interesting because, you know, like when Kevin Systrom and his, and his co-founder left Facebook, I think there was a sense that it was, there was some bad blood, but with these things, there's always a little bit of sort of corporate speak. And so this seemed like the first time where he sort of very publicly was just like, yes, we left because it felt like Facebook was not investing in Instagram to the level

• 22:31Anthony Ha?

  that they should be. And then it seems like certainly in the years since they left, that's turned around and for better or worse, Facebook is definitely making Instagram a big priority now.

• 22:40Kirsten Korosec?

  Yeah, but it took a while.

• 22:42Anthony Ha?

  Yeah. Well, and that's interesting. I mean, again, you know, I feel like half the time I'm just like doing disclaimers, but like, I don't know how much this matters in an antitrust context, but to a certain extent, it's like, you could say Facebook, the way they handled both acquiring Instagram and then sort of managing it in those early years was sort of anti-competitive. Does that really mean that in 2025, they should be, you know, forced to sell Instagram off? Like it feels like maybe those are things that should be penalized for, but if this is fundamentally about competition and competition in the social media space, like that doesn't really tell us about like the landscape in 2025.

• 23:15Speaker 02

  Right. We do have to move on shortly after this, but I do just want to say like, I think the FTC has struggled a lot in presenting this case against Meta. There's been some stumbles so far, but I think that this moment on Instagram has really been kind of a high point for the US's argument that Meta is being anti-competitive here. Because, I mean, obviously Instagram is like one of the most popular apps in the world. But I think everyone who goes on Instagram can say, this maybe isn't the perfect experience. Like, it's getting filled with AI slop. You barely see your friends anymore. You're kind of just seeing businesses when you use, like, it's clear that there are problems with it. And maybe if Meta didn't own it, it could be a better experience.

• 23:54Speaker 02

  That said, though, we do have to move on to some funding outlooks for 2025 for startups. Kirsten, can you kind of walk us through what we're seeing in the startup funding landscape?

• 24:05Kirsten Korosec?

  Well, it's interesting because on the one hand, startup funding was hitting records in Q1. And yet, that doesn't tell the whole story because nearly half of that money, which was about $91.5 billion in the first quarter, that's more than 18% gain from the previous quarter. And it's the second highest in the decade. But half of that money came from OpenAI's $40 billion round. So it doesn't really show a balanced quarter. It's very uneven. And so we had a story that is pretty interesting.

• 24:48Kirsten Korosec?

  Marina wrote about it and she talked to Kyle Stanford, who leads US venture capital. He's, he's an analyst over at PitchBook and he's pretty bearish, actually, about it, even though there was this very high growth. And really what he centers on is that the expectations around 2025, being the year that we're finally going to see these huge exits and we're going to see all these IPOs, is just not happening. And we're seeing that already, like, in our coverage and our discussions the last, I don't know, month or so, examples of IPOs either being put on ice a little bit. I mean, there's been a few cases where companies have gone ahead and filed, at least confidentially, or signaled that they were.

• 25:31Kirsten Korosec?

  But that, to me, is the far more interesting thing than just, hey, big number, big growth.

• 25:37Anthony Ha?

  Right. Although actually on the concentration side, I think it's also worth highlighting the fact that 71% of the total funding just went to 10 companies. So like you take those 10 companies out, like that's just a 29% remaining slice of the pie, which is, and that's every other startup.

• 25:54Kirsten Korosec?

  Yeah. And how many of those startups were outside of the AI sector?

• 26:00Anthony Ha?

  Right.

• 26:01Kirsten Korosec?

  Probably none.

• 26:03Anthony Ha?

  Oh, in terms of, yeah, I guess the big 10, there is investment going to some other areas, including like pharma biotech, I think that was like, like, which is up like 29%. Energy is up 79%. So, I mean, there is growth and it seems like the, the size of the rounds is is sort of going up in general, but that's all just happening in the shadow of like these giant AI companies that are just hoovering up the vast, vast majority of the funding.

• 26:27Speaker 02

  Right. I mean, we've been, I think for the last couple of years, been in this kind of era of free money for AI startups. It's still going on today. Like, like I think as this data shows, we're still very much in that era right now. Mary Ann had a story earlier this week about an ex meta engineer that raised $14 million for their startup and they help with home services, but they kind of described themselves in the story as a revenue generation startup. There's just like a lot of kind of interesting ideas that you kind of look at them and you say, oh, that's, that's, that's a business right there. And you're wondering like, how are these getting so much funding these days? And I think what the analysts at PitchBook are saying is that we don't think that this is going to continue. We think that, you know, we are entering

• 27:11Speaker 02

  a much more bearish era for funding because investors aren't getting that liquidity from exits.

• 27:16Kirsten Korosec?

  I kind of wonder how big this bubble is then, because if you see companies with, let's say vague business models, getting decent funding rounds while at the same time, you see to Anthony's point, fewer startups getting a smaller slice of the pie and like a lot of money going towards the big AI companies like OpenAI. And at the same time, by the way, we've seen a bunch of down rounds in the past few months. I mean, just off the top of my head, there was Parallel Systems was a down round, Rapid Financial Network, I believe was a down round, this AI-based workforce as a service marketplace called, I'm going to completely kill the name, but Job and Talent, I guess, is.

• 28:01Kirsten Korosec?

  It's all one word.

• 28:03Anthony Ha?

  Nailed it.

• 28:04Kirsten Korosec?

  Nailed it. You know, you look at all that together. It's like, it just seems, to your point, Max, unsustainable. So my question is, and one I'm not ready to answer, but maybe you two will, you know, put your predictor hats on. When is this AI bubble going to burst? When are the early-stage startups that throw AI in their pitch decks not going to get funding anymore? Or has that moment come?

• 28:28Speaker 02

  It's hard to predict when exactly the bubble is going to burst here. I will say that I was tuning into IBM's earnings last night, which, you know, legacy tech company, and they were giving a pretty grim outlook for the future. I mean, and I think this is something we're starting to see on a lot of earnings calls lately. IBM said it was just was going to start projecting to the next quarter for some of their expectations around revenue. And it's not something they usually do, but they said, we're just in such an uncertain time. We feel like we can only predict 90 days out. And so we're going to try to give our investors just a little bit of confidence about what's going to happen 90 days from now, because we're in such a volatile space. They said the Doge cuts are really affecting them. So I just think that broadly, we're in this like very kind of uncertain market.

• 29:13Speaker 02

  And I think that everyone is kind of starting to tighten their belts here.

• 29:18Anthony Ha?

  Yeah, I wonder if there's also like a parallel to, I mean, I think this is true and across like different tech sectors as they mature. But I was thinking particularly about like streaming as like an area where for a long time, like Wall Street money and other, you know, venture money was sort of going in on the assumption of like, all we care about is growth and we just want to see the, you know, number go up. And then at a certain point, they're like, basically when Netflix had a rough earnings quarter, suddenly it became about profitability. And I think that's going to be a really rough time for a lot of AI companies where it's not just enough to say, hey, like 10s or hundreds of millions of people lose our, use our product and like, we bring in a lot of revenue, then we're like, great, like, how much money are you losing? And it's like, those are going to be very large numbers that are going to be very scary.

• 29:59Kirsten Korosec?

  Yeah, once we start seeing, and by the way, like, you know, you get insight into those numbers when a company files to go public or they choose, you know, I'm talking about privately held companies, choose to relay those numbers. So I think you're right in that there will be that moment where they have to answer for that. And then Max, to your point about volatility, on the publicly traded stage, we are seeing this kind of Schrödinger's cat situation in which because of all the volatility, you're seeing guidance happening from companies that are giving two different figures because of the amount of volatility. We could make money in 2025, or we could lose money. That's pretty unusual.

• 30:44Kirsten Korosec?

  And I'm starting to see that, I think, trickle down to the startup realm as well, not just the publicly traded realm. So TBD, I am sure we will talk about it so much more in the coming weeks, but we are out of time. Thank you, Anthony and Max, of course, as always, for joining me on this conversation. Until then, to our audience, you can find equity under the handle at EquityPod on X and Threads.

• 31:12Rebecca Bellan?

  Equity is produced by Teresa Loconsolo with editing by Kel. We'd also like to thank TechCrunch's audience development team. Thank you so much for listening and we'll talk to you next time.