Meta's 'open' AI, data centers' hidden costs, and a $250M deal gone very wrong

Meta released Glimmer this week, an open-weight AI model anyone can download and run on their own hardware — a contrast to Muse Spark, the company’s more powerful model that stays locked behind its own APIs. The release landed alongside a letter from Mark Zuckerberg arguing AI should be “for everyone” rather than controlled by a handful of labs, but as Equity’s hosts point out, the vision comes with some asterisks. On this episode of TechCrunch's Equity podcast, Kirsten Korosec, Anthony Ha, and Rebecca Bellan take a look at Glimmer, Zuckerberg’s 6,500-word manifesto, and more of the week’s headlines, from the true cost of the AI industry’s energy needs to a $250M acquisition gone very wrong. Listen to the full episode to hear more about: Who’s on the market for a $300 cocktail robot? Why Anthropic is adding watermarks to its generated text, and users are not happy. The potential cost Amazon’s planned data center in Texas and the startups racing to fix the grid, including Form Energy’s $750M raise for 100-hour batteries, Reservoir’s $8M bet on smarter water heaters, and Discovered Materials’ hunt for cooler chips. Why Joby Aviation’s $500M acquisition of a defense contractor reminds Kirsten of its Blade deal last year — and what the 2028 LA Olympics have to do with it. How a $250M deal between video-clipping startup VideoVerse and sports publisher Minute Media collapsed amidst allegedly forged documents, multiple lawsuits, and a CEO nobody can reach. Subscribe to Equity on YouTube, Apple Podcasts, Overcast, Spotify and all the casts. You also can follow Equity on X and Threads, at @EquityPod. 00:00 Intro 1:20 Would you buy a $300 cocktail robot? 3:08 Meta's Glimmer and the “AI for everyone” pitch 8:03 Anthropic starts watermarking its writing, and users have thoughts 14:34 Amazon's data center and its natural gas problem 16:37 The startups racing to keep the grid from melting down: Form Energy, Reservoir, and Discovered Materials 23:28 Joby Aviation buys into defense with Resonant Sciences 28:24 The $250M VideoVerse-Minute Media deal, a missing CEO, and a mess of lawsuits 32:37 Outro 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.

• 0:00Speaker 00

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

• 0:05Kirsten Korosec?

  Mark Zuckerberg wants to give everyone their own personal AI. We'll get into why and what it says about the line Meta's drawing between the AI it gives away and the AI it keeps for itself. Also this week, the data centers powering all this AI are starting to show their true costs. And we're keeping our eye on a couple of deals this week, including a quarter billion dollar acquisition that fell apart into a mess of fraud allegations and forged signatures.

• 0:38Kirsten Korosec?

  Hello and welcome back to Equity TechCrunch's flagship podcast about the business of startups. Today is Friday, August 14th. I'm Kirsten Korosec, Transportation Editor here at TechCrunch, and I'm joined, as always, by our Weekend Editor, Anthony Hall, and this week, Rebecca Bellan, our Senior Reporter, specializing in AI. We've been all on kind of like a little vacation thing. Sean O'Kane is out this week. I was out last week. We've all been out and about in the world and I came back and was so happy to see a fun little review from one of our reporters. It's about a cocktail robot. I'm wondering, A, would you buy this?

• 1:19Kirsten Korosec?

  And if not, who, who's the customer for this $300 robot that makes cocktails for you?

• 1:26Rebecca Bellan?

  No, of course I would not buy this. Well, okay, so it makes, it makes, like shakes it up? I actually need to see this thing, like.

• 1:32Kirsten Korosec?

  Yeah, so it works like an espresso. Think of it as like these little pods. You supply the alcohol.

• 1:38Speaker 00

  Like a Keurig, yeah.

• 1:39Kirsten Korosec?

  And this is why some former TechCrunchers, specifically, I'm going to give a call out to Devin Coldaway, I know that he would like be offended, deeply offended by this product because he's a cocktail guy. Some of these liqueurs are actually non-alcoholic and they're just mimic. So if you were going to, let's say, make an aviation, which uses a lot of these elixirs that are liqueurs, it would be like an offshoot of that. So it wouldn't be, for the purists, I think it would be a problem. But it just, to me, is so interesting that like, we're roboticizing so many products and I'm wondering, do we need to for the cocktail?

• 2:17Rebecca Bellan?

  Is it a robot if it's just, if it's just a Keurig but for alcohol? Like, why are we calling it a robot? It's just a Keurig for alcohol.

• 2:25Speaker 00

  And if you check out a Manistore and you look at it, it, it looks like a Keurig, too. It does, there's no, there's no like robotic arms that are shaking up.

• 2:32Rebecca Bellan?

  Yes. This is going in hotels and tech bro apartments. That's where it's going.

• 2:37Kirsten Korosec?

  Yeah, so that's what I was thinking is that maybe like an Airbnb super host?

• 2:42Speaker 00

  Yeah, I mean, I could imagine this, like certain places where it could be like interesting, but no, it had, it has no appeal to me. I mean, I'm a New Yorker. I like bars, I like bartenders, like. Part of the reason you brought this up, I assume, besides the fact that it's fun, is that this kind of fairly silly question about a cocktail robot also ties into these kind of broader questions about like, what kinds of assistance do we want? What kind of, you know, technological, personal assistance? This is something that Mark Zuckerberg was talking about this week. The company Meta released a new AI model called Glimmer. Maybe we'll start with Glimmer. Rebecca, can you just tell us what Glimmer is?

• 3:14Rebecca Bellan?

  Yeah, so Glimmer is a new capable open source model. It's kind of, it's essentially like a pared down version of Muse Spark, which is Meta's most capable model. It was their first frontier closed source model that they released earlier this year in April. And so Glimmer is open weight, so that means anyone can download it, run it on their own computer, tweak it, build products on top of it.

• 3:38Rebecca Bellan?

  And, you know, it, it's, whereas Muse Spark can like only be accessed via Meta's, you know, own APIs. So I think that this kind of leads into Mark Zuckerberg's vision of like AI for everyone, right? It's a, it's something that you can run to, to, you know, help you with multi agents for, you know, getting your life together, doing your work, anything personal.

• 4:03Kirsten Korosec?

  I have a couple of questions about this. So on the one hand, they still have a closed weight model. And then Glimmer is this message of AI for everyone. Is Mark Zuckerberg trying to do both? Is he trying to thread the needle where, you know, it's like the win-win? Because that's very difficult to do. I'm just wondering what, and do you think he can pull it off?

• 4:29Rebecca Bellan?

  Yeah, I think, you know what, like cynically, I think that this is Mark Zuckerberg and is like a attempt for Meta to win in a different way, right? Like, they're not winning in the frontier closed model space. They're not necessarily even winning in the open space, but when it comes to personal empowerment, as Mark Zuckerberg talks about in his letter, "The Future is for Everyone", I think that's where he's trying to win. He's trying to like give, like provide the models that people will use, you know, for their own personal AI on their own personal devices, right? Like, I think last year when he published a "The Future is for Everyone" letter, the thought was that a lot of that AI would go on to the glasses, the wearables. But, you know, it's not really clear what the final hardware form factor for this would

• 5:13Rebecca Bellan?

  be, and I guess he's like leaving it up to the individual to choose, right? So his idea is that you're using Glimmer for like managing your schedule, drafting messages, organizing files. It's always on, it can operate anytime, anywhere with or without an internet connection. So, yeah, but then there is still Muse Spark. So I think that, like, that maintains a way for them to, you know, control, have some level of control over still its most capable models and provide, you know, a revenue outlet for people who want to scale their compute and people who want to like do larger projects or companies that might want to do larger projects.

• 5:52Speaker 00

  I imagine the part of the context here is also, you know, like Meta, like you said, in AI, obviously has made some very serious investments in AI, you know, and, and, you know, last year there are also all these stories about how much money they were trying to pay for, for AI scientists. But in terms of like who we think of as kind of like the leading companies, the frontier labs, like Meta doesn't tend to come up in the conversation. I think another way it doesn't come up in the conversation is in, you know, what are the, the kind of popular consumer AI chatbots, right? Like, certainly people are interacting with Meta AI tools in Instagram, in Facebook and all these things, but it's not a company that you think of as like, oh, when I'm going to go like use my like personal assistant.

• 6:36Speaker 00

  Meta isn't that yet and I'm, so it feels like to a certain extent, this is an attempt to reposition them and try to claim space that they really haven't been that successful in before. Is that fair?

• 6:48Rebecca Bellan?

  Yeah, I think that is really fair to say. And, you know, I would take it with a grain of salt because like Mark Zuckerberg loves to, you know, put out a vision of what, you know, his companies will do for people and how they will empower people. And so far, what that looks like for Meta, like, I mean, of course Lama is great, it's a great tool and open source, but I think that, you know, from a, on a consumer level, how are people using Meta's AI? Well, there's like a lot of creepy ass chatbots that, you know, and a lot of people can like build their own chatbots that, you know, if you ever look through this, there's, you know, some, some like fairly interesting role-playing chatbots that are available on Meta's platforms that people can, can use. And, you know, he's talked a lot about this loneliness epidemic and how are we going to address the loneliness epidemic?

• 7:33Rebecca Bellan?

  And I think that, I mean, my TLDR is, I think that his letter and his idea of personal empowerment is put in a bad taste in a lot of people's mouths because it's him who's saying it, right? Like, look back to the social media days. Russell Brandem, our AI editor, wrote about this this week. Like, you look back to the social media days, he was saying that he wants to make sure that everyone, you know, has an outlet for talking to their friends and having a social network. And what do we have instead? We have like rage baiting and advertisements and not, not connection.

• 8:09Kirsten Korosec?

  Yeah, I think that the manifesto didn't, um, strike the right note for a lot of people. And to Russell's point, which he makes in this column, is it's what's making people hate AI or hate on AI. Because, to your point, it is coming from Zuckerberg. And I do think also it feels very Pollyanna-ish in a way to, to, this is a 6,500-word manifesto. He's kind of put these thoughts out there in the past. And it really doesn't provide what I think is a more realistic picture, but instead

• 8:49Kirsten Korosec?

  casts AI as, you know, this, this great tool for humanity. And that might be the case, but there will also be like extreme costs to that. And I think that that's why the reaction, the negative reaction to it has been, you know, so widespread. I don't know if you agree, Rebecca, but that's kind of my, my thinking on it.

• 9:11Rebecca Bellan?

  It feels like he's positioning himself as like, almost like an, like an anti- Anti Dario, I don't know, like, there's a lot of talk among the frontier labs, pacing the frontier, pulling back, you know, focus on safety, we need to slow down development, right? They're not doing any of that, of course, but they're talking about it, right? And because of all these recent cybersecurity incidents that we've had, whereas Mark Zuckerberg, on the other hand, is like, no, no, we do not slow down, we cannot afford to give an inch to China, and slowing down would only like hurt the individual who can like super be empowered by this technology. But like, I mean, I was like, maybe I'll try to download Muse Glimmer and see what I can do with it. Like, can I download it to my MacBook? No. Like, you need like specific hardware. I forget what the hardware is.

• 9:56Rebecca Bellan?

  Like, it's not actually that accessible to the average person, like, maybe developers.

• 10:00Kirsten Korosec?

  So it's not for, it's not for everyone.

• 10:02Rebecca Bellan?

  Not yet, at least.

• 10:03Kirsten Korosec?

  It's not a tool for everyone, yeah.

• 10:04Rebecca Bellan?

  No, God, no.

• 10:05Speaker 00

  I will say, the one positive thing I will say for this very long manifesto, again, like six, you know, 6,500 words, longer than almost anything that's been published on TechCrunch, for example, is that there is one sentence where he says, if you are an AI doomer and you believe that that's the future that AI is going to bring, why are you building this stuff? Which I think is fair.

• 10:28Kirsten Korosec?

  Yeah, I like that.

• 10:29Speaker 00

  Although maybe the takeaway from that is not, is the takeaway is not that the AI future is great, but it like makes you wonder about people who are making these predictions and then kind of pushing ahead anyway. I also wanted to talk a little bit about, you know, Russell's point, which I think is totally a fair one about like how, you know, part of it is the messenger, right? Is that for a variety of reasons, I think that people are suspicious of Mark Zuckerberg, of Meta. I think, you know, arguably that could become amplified over the next few months as this like new Facebook movie is coming out. But it's also about the future that is being promised by these AI companies and often why we see these kind of whole kind of viral pylons whenever, you know, Sam Altman or

• 11:11Speaker 00

  Mark Zuckerberg or somebody is making a prediction of this AI future and people essentially say like, who wants this? I mean, I think maybe one of the more famous recent examples was Sam Altman talking about the idea of like, hey, like, you could use ChatGPT to make podcasts about your kids' interests to listen to while driving to school. And of course, everyone is like, well, why don't you just talk to your kid? And I think that that was part of this. I mean, part of the manifesto was half of it was just stuff where it's just like, you're good, it's going to unleash all this creativity and invention, and it's so abstract where I just think if you're skeptical about AI, none of that is going to convince you because it just doesn't, it seems unreal. And then the stuff that is more concrete about these sort of like personal coaches and assistants, there's some aspects that appeal, but a lot of it that don't at the same time.

• 11:55Kirsten Korosec?

  Yeah, I mean, I also think that what's happening here, and we saw evidence of it already this week with Anthropic, which is these companies, these massive companies that are promising and also cautioning of the future, but sort of they are the ones that are talking about what the future is going to look like. And I think part of the issue that users have is that future keeps changing and the rules around that future keep changing. And so in a very small example of this is Anthropic released this watermark that it's going to be putting on. And there's been extreme pushback on that because it's like, hey, use our product, use our product to help you write. Oh, but also now we're changing the rules a little bit. We're going to put a watermark on here so people will

• 12:36Kirsten Korosec?

  know. Now, that seems like in some, some people might have that view that that's like, that's a good positive thing. The point is, is that people are pushing back because all of a sudden, the companies that are creating these tools and pushing people to use them keep changing the rules in which they're engaged with. And I think that that is not going to end anytime soon. And we're going to continue to see these. And, and, and there will always be this sort of tension between the user and the creator.

• 13:06Speaker 00

  Well, I think it's also not just the user and the company, but also, you know, governments and regulatory bodies. In this case, it's not just Anthropic deciding on their own that they wanted to add the watermarks, but, but I guess it's essentially in compliance with EU law. And I think part of the pushback also has to do with the social dynamics around AI and that, you know, as I think a lot of resistance and backlash to AI is kind of hardening, that there's almost this kind of paranoia around it. Like, you don't want to be caught be posting AI content. And so that's part of why people are, you know, scared of this watermark. And, you know, the same way you see like LinkedIn adding these buttons, report AI slop. And so it, there, there is this, this, again, I think to your

• 13:47Speaker 00

  point, just in this sense of like, both these tools are getting pushed on us, and yet there's a certain stigma around actually using them.

• 13:56Kirsten Korosec?

  And you're right, the regulatory piece is also changing the rules. So it's just creating this very interesting dynamic. It's also starting to reveal, I think, the true costs that are associated with AI, not just on the social dynamic, but also on an infrastructure dynamic. And I'm talking about data centers. There were a ton of data center stories this week. And I think, I don't know how either of you view this, but clearly, the populace is waking up to the cost factor of data centers. And there's a lot of pushback and protests. But I wonder if the public is understanding it on a broader level of like, what this massive build out of data centers will mean.

• 14:41Speaker 00

  Every company today is looking for an edge. Better insights, faster decisions, greater resilience. But as AI drives new growth, it also creates new demands on energy and infrastructure. Schneider Electric is connecting energy, automation, and digital technologies to help organizations make smarter decisions and operate more efficiently. Because the future won't be shaped by AI alone. It will be shaped by energy and industrial intelligence. Schneider Electric, advancing energy tech. Yeah, I mean, it's definitely like been a very surprising phenomenon to me, just like how much the kind of AI backlash has really focused on, on data centers. And I think there's a bunch of reasons for that that we can get into. But, you know, part of the reason we're talking about it now is this report that came out in the New York

• 15:25Speaker 00

  Times this weekend about prospective Amazon data center in Texas, which, to be clear, what we're describing is basically what's been permitted. And, and we'll, you know, what the reality will be, we'll see. But in the permits, basically, they're saying we're going to build an onsite natural gas power plant, because I guess increasingly, these companies that build data centers, they found the easiest way to, to, to deal with the kind of power needs, instead of trying to hook up to the grid, is just build their own power center onsite, and then we don't have to worry as much about the grid. And that power center is permitted to basically release more carbon into the air than any other power plant in the United States. So if it kind of used that full capacity, it would be the largest carbon polluter in the United States.

• 16:10Rebecca Bellan?

  That's pretty insane. Like, the energy is becoming the hugest bottleneck for data centers. So they're, they're pulling it from everywhere. You're seeing like companies spin up nuclear sites again, et cetera. But this is, this one, I think, is really notable because it's, you know, Amazon, last year, were already up 16% from its overall carbon emissions. And it's moving away from its 2040 net zero pledge. So you're really seeing how companies and like what they're willing to do to push forward and like the pledges, you know, that they have for the environment, et cetera, are really like downstream of federal policy and federal mood, right? Like, the Trump administration made it a lot easier,

• 16:52Rebecca Bellan?

  like rolled back a bunch of environmental protections so that we could build data centers faster. And I think there's just this absolute grab for energy that's happening that, you know, doesn't necessarily take the wider world or climate, or potentially even individual communities into account.

• 17:10Kirsten Korosec?

  Individual communities are absolutely pushing back, and I think that's putting a lot of pressure. There's also just the realities of the economics of how to power these data centers. We've done a lot of reporting on it, but just to like level set it for everyone, data centers are expected to quadruple the US electricity use by 2035. So that's a big number. And as a result, you can look at how long it takes to build a natural gas power plant, and how long it takes to throw up some solar and energy storage. And the permitting alone, and the speed of which you can, you know, you know, put in and install

• 17:51Kirsten Korosec?

  solar, is basically creating this interesting scenario in which a lot of renewable energy is now being used to support these data centers. Not because it's a good positive story, by the way. It's economically behooves the companies to do this, and it's good that we have this technology. So there's interesting things that are happening in the background because of all this demand. Obviously, a lot of protests on the community side, but also... Um, like a huge amount of installed solar, a lot of energy storage, a lot of startups kind of popping up or that have been existing for a while, but finally getting the attention that they sort of deserve and getting a lot of money behind it. One of those is a company

• 18:35Kirsten Korosec?

  called Form Energy. And I don't know if either of you read this story that our climate tech reporter wrote, but that company just raised $750 million because they have created a 100-hour battery, basically, that is really critical energy storage that can be coupled to support the grid and then also, you know, support data centers. So you're seeing these examples because of this.

• 19:01Rebecca Bellan?

  Yeah, I mean, you're seeing it on that side. You're seeing it on the consumer demand side as well. Um, as you know, people are feeling like their energy use is, you know, dire at the moment, right? So like, I think Reservoir we wrote about is this company that raised $8 million to make water heaters. Their pitch is basically that water heaters are dumb energy wasters and they could instead store energy as hot water and shift demand to cheap, low-demand hours. So, yeah, there's just like all these new ways to kind of think about energy that, you know, data centers are helping with, I guess, will will help promote, uh, clean, green energy in that way.

• 19:41Kirsten Korosec?

  Yeah, I mean, just really quickly, I, okay, many years ago, I was a clean tech reporter. This is when we called climate tech clean tech. And there were companies that were working on all sorts of really interesting things around heat pumps and, you know, hot, you know, hot water heaters and, you know, efficient HVACs and solar. And, you know, a lot of that died off or just didn't get the attention and the VC money it deserved. And so there are periods of time in which a product becomes so necessary, AKA data centers, and the demand's so great that that it then is an accelerant when it comes to these types of technologies. I mean, Form Energy is not like, didn't just start

• 20:26Kirsten Korosec?

  up yesterday, right? So, um, I, I think it's the good news aspect of what is, you know, potentially a great polluter, um, when it comes to data centers. The, the, hopefully more of these startups that have really good, solid ideas and products get more tailwinds and are able to actually bring their products to market.

• 20:48Speaker 00

  Yeah, I did want to mention one other startup that we covered, a technist we called Discovered Materials, which is working on making data centers and the chips cooler, and which apparently is a, is a major source of, of where, why the power consumption is what it is. I didn't know that, but it's a very interesting story that we ran. And apparently they're using AI to try to find ways to design chips that are cooler. So I do, yeah, I agree that this is all very promising. And I think that that has been a recurring theme when people bring up the environmental concerns around AI and data centers is that actually, a lot of this could be powered by renewable energy. AI could even play a role in making the energy, you know, more environmentally friendly. I think

• 21:29Speaker 00

  then the question, or certainly one of the questions is, can that sort of happen quickly enough to offset, you know, the tremendous growth in, you know, burning fossil fuels? Because renewable energy is not appealing just because it, yeah, it's great if we like just get more and more energy from solar, from all these other things. But it's part of the reason it's desirable is because putting carbon into the air is very, very, very, very bad for our planet. And so if like, you know, our, uh, energy consumption or energy usage, like, you know, quadruples and half of that is renewable and half of that is through, you know, stuff that's, that's increasing climate change, uh, that's still really bad.

• 22:08Kirsten Korosec?

  So to answer your question, is it going to happen fast enough? I'm going to say no, because we've seen companies like circumvent permit processing and things like that to get, um, their, their power supply, which is, you know, oftentimes renewable energy, but sometimes not, um, as fast as possible. But I do think that there's some promising technology out there and companies that have made real headway that are not in like the lab, they're actually, you know, producing, they have a product that can be used. We are seeing that. I just, you asked the question in the beginning was, is it going to happen fast enough? And I would say no. I mean, I think we're going to see definitely more emissions associated with data center build out. Um, and also the other environmental

• 22:52Kirsten Korosec?

  factor that we haven't talked a lot about is the water use, which, you know, are there startups working on ways to, um, make the water use in data centers more efficient? Because that's actually just as important, if not more so, when it comes to like this data center build out.

• 23:11Rebecca Bellan?

  Yeah, well, I mean, talking about climate, for whatever reason, reminds me of my time working under Kirsten's desk in transportation, under which I often wrote about defense as well. There's a lot of overlap between the two. And we've got an interesting defense story that came out. So I think it's time to move to the deals of the week. So, um, one of the deals is that Joby Aviation, an EV toll startup, they're building out their defense business with a $500 million acquisition of Resonant Sciences. That's 500 million in cash and stock. So Resonant makes radio frequency sensor systems. Uh, they're based in Ohio. They bring access to classified government programs. This is pretty interesting. I think, like, we've seen other EV toll, for those who don't know, this is electric vertical

• 23:53Rebecca Bellan?

  takeoff and landing vehicle startups do defense deals, like last year Archer did a big one with, um, Anduril.

• 24:01Kirsten Korosec?

  Yep.

• 24:01Rebecca Bellan?

  And so, yeah, I'm kind of curious. This is like, that one was like, we're doing weapons with our, like, warfighting planes. This is very different.

• 24:08Kirsten Korosec?

  This one, yeah, this one, I think, is, uh, more, uh, I'm not going to say more reasonable, but it makes more sense because of the other elements of Joby's business. So you've written a lot about Joby in years past when you worked under our desk. We miss you over here. Um, but this one is interesting because Joby started working on some defense piece, specifically a hybrid electric aircraft. So, you know, for those who aren't familiar with Joby, they were working on an all-electric EV toll. Um, and they're still doing that. And that's going to be used for like urban air taxis and, and stuff like that. They started

• 24:48Kirsten Korosec?

  doing this hybrid piece and as a defense play, um, because of the longer distances. So this new company that they're acquiring, the, their technology, which is essentially like radar, radio frequencies and systems, can be then added on to those planes, which then makes it a really, hopefully in Joby's view, um, what they hope is a very attractive product to, you know, the US government as a customer. So that makes a lot of sense. The interesting thing here is that they're creating a whole division. Um, and so to me, that is a signal that they're just like, you know, dabbling around and trying to be dual-use. They're, they're making a real go of it.

• 25:31Speaker 00

  And the sense I got reading your, uh, Kirsten, your story about this deal was also that it suggested Joby is in this place where, you know, there is this very kind of exciting, promising air taxi vision, but that is still probably many, many, many years off. And they're kind of now at the point where maybe investors are saying, hey, you've got to actually make some money now, not five, 10 years from now.

• 25:53Kirsten Korosec?

  Yeah, to jump in, it's not many, many years away. I mean, they are, they are getting close. They've gone through almost all the steps on the, the type one certification, which I will not get into, but it is a process that is required under the FAA. Um, they are under a Trump administration pilot program, one of the companies that is going to be doing these piloted, um, flights this year. But you are absolutely correct in that investors really wanted to see, I think, want to see some sort of revenue. So the company they bought is profitable. And it reminds me of another acquisition they made last year, which was with Blade. That's the helicopter rideshare. You know, it's a fossil fuel-based product, has nothing to do with the overall mission of Joby. But guess what? It gave them revenue.

• 26:38Kirsten Korosec?

  And it gave them enough revenue to show a pretty big growth from the same period last year, um, per their earnings. So I think that it is a, a way of, uh, it's a near-term revenue plan. I'll put it that way.

• 26:52Rebecca Bellan?

  Yeah, that was going to be my question. Like, how far are we from, like, you know, the whole, when they were pitching it, it was like, we want to do rideshare for the skies, air taxis, yada, yada. But now it's like, huh, that's like the goalpost keeps, like, you know, the timeline keeps getting pushed out. It's like, all right, we actually just need to get money. It's a tale as old as time when they're like, all right, we need to get money. The government, defense, we're moving into the military and the time could not be better, honestly. I mean, like everyone in Silicon Valley, et cetera, and the government has a serious desire for defense.

• 27:25Kirsten Korosec?

  True. I would say, keep an eye out for, there's been a lot of shift. I want to talk about one other really interesting startup story, but I will close with this when it comes to Joby. The Olympics are in LA in 2028. I think that you should absolutely look at that as key dates for a lot of these companies who want to, or that want to, you know, be launching and showing, showcasing that technology. And you're seeing a lot of movement in the space of EV tolls. I mean, earlier this week, Archer acquired Wisk, which is also huge news. So there's a lot of movement happening in this space, something to watch, especially over the next year. And I do think it's not going to keep, you

• 28:07Kirsten Korosec?

  know, someone's going to launch. I'll put it that way. It's not going to, you know, we're not going to have the same conversation three years from now.

• 28:13Speaker 00

  Well, let's move on to that last deal, which is, well, it's a deal gone wrong, I guess is probably the simplest and I think a pretty fair way to put it, which is, so there's a video clipping company called Videoverse, and it was acquired by a sort of larger media company called Minute Media for $250 million. And we ran a pretty in-depth piece, I think it was by Russell, kind of digging into what has happened since the acquisition. There's a lot of accusations kind of flying back and forth, there's lawsuits. And I think that, I mean, certainly one thing we should just emphasize is right now, there's sort of a lot of finger pointing, there's lots of lawsuits, lots of allegations, but you know, this stuff hasn't necessarily been sort of proven out in a court of law yet. I'm curious for either of you, I mean, what were your takeaways from this story?

• 28:56Kirsten Korosec?

  So I spent some time with Russell on this story, actually. And, you know, to me, it is a cautionary tale, I think, for, you know, all parties involved. And you're right, these are accusations, there are a number of lawsuits, not just coming from some of the investors, so some of the VCs, but also from some employees who have accused or alleged that the CEO, where I should say, almost all of the accusations and allegations are focused on one individual, which is the CEO. To me, this is really interesting and kind of like a classic cautionary tale, because this was, this company was a darling, if you

• 29:39Kirsten Korosec?

  will, and was really like highlighting the startup scene in India. It was a success story. And so everything seemed to be going like gangbusters and it just went completely sideways. And it also, I think, is a reminder of the limits of due diligence, you know, so like on the investor side. And so there is ultimately still a lot of trust. This is a trust game when you're investing in startups and how they're going to exit.

• 30:07Rebecca Bellan?

  The trust thing is really real. It kind of reminds me of, I'm not sure if you guys saw a few weeks ago, maybe you talked about it on the show, but Dom, Dominic Manjori-Davis, one of our reporters, did a story on a study that showed that VC-backed startups commit more fraud. And, you know, a lot of that is just because of the pressure that they have to, you know, meet these insane expectations of investors. And so they kind of like lie about it. They're like, yeah, sure, I can do that. Like, or we've already done it, right? So that's kind of what my takeaway from this, from this story was.

• 30:38Speaker 00

  I think there's probably any number of kind of startup scandals that you could point to that it might remind you of, certainly it made me think of, you know, the Frank story, their acquisition, and then, you know, how subsequently the founder was accused and ultimately convicted of, you know, inflating a lot of the customer numbers for the acquisition. I mean, this story is, I think, at least at this stage, considerably more complicated than that, because there's so, again, all the fingers are kind of pointing to Videoverse's CEO, but the accusations and who's mad is sort of, there's a lot of different ones. I mean, one of the ones I found kind of just most eyebrow raising and intriguing was the idea that he allegedly had basically taken the acquisition agreement, but like, created

• 31:23Speaker 00

  kind of fake versions of what the acquiring company had promised and was telling investors kind of completely untrue things about what was actually going to happen in this acquisition, which, yeah, that's, again, if that turns out to be true, that is a very impressive strategy.

• 31:40Kirsten Korosec?

  I don't know if we'll ever get the answer to this. And we should say that the CEO was ousted. He's been out since the end of April. That's, I think, an important point here.

• 31:52Rebecca Bellan?

  He's now unreachable.

• 31:53Kirsten Korosec?

  Yeah. He is unreachable. Yeah. Somewhere in the Middle East, per our reporting. But to me, I don't know if we'll ever get the answer to this, but why? Because you had the exit, man, like $250 million exit. Why? Because some of the accusations are post-exit, in which, you know, loans were apparently brought against what that exit is. So is this, is this a story of just greed? Or is it a story of terrible decision-making? Or to Rebecca's point earlier, like pressure? I mean, I want to know the why as much as, probably that's my biggest question. And unfortunately, I don't know if I'm ever going

• 32:38Kirsten Korosec?

  to get the answer to that one.

• 32:39Rebecca Bellan?

  Broadly, my takeaway, like if, you know, speaking from an American point of view, is that it also shows that like the SEC like can't do much about anything when it doesn't come to like a public company, right? So, you know, private companies, you know, defrauding investors or investors defrauding each other, or what have you. I think that that creates, it's just like the name of the game. Like, there's just, it's a bit of a Wild West, I guess, which I think is problematic in the long run.

• 33:09Speaker 00

  Well, I do, if nothing else, very much hope that we do just learn more about what actually happened with Videoverse in the future. But for now, we are out of time. Equity, of course, will be back next week. And you can always follow us at EquityPod on X and Threads. Thanks so much for listening.

• 33:26Rebecca Bellan?

  Equity is hosted by TechCrunch senior reporters and produced by Teresa Locan Solo with editing by Cal. Subscribe on YouTube or wherever you get your podcasts and find out what's next at techcrunch.com/events. Thanks so much for listening and we'll talk to you next time.