Thinking Machines’ First AI Model, California Loses $3.2B to Texas, TSMC Adds $100B | Diet TBPN

Diet TBPN delivers the best of today’s TBPN episode in 30 minutes. TBPN is a live tech talk show hosted by John Coogan and Jordi Hays, streaming weekdays 11–2 PT on X and YouTube, with each episode posted to podcast platforms right after. Described by The New York Times as “Silicon Valley’s newest obsession,” the show has recently featured Mark Zuckerberg, Sam Altman, Mark Cuban, and Satya Nadella. TBPN is made possible by: Ramp - https://ramp.com Public - https://public.com Cisco - https://www.cisco.com Console - https://www.console.com CrowdStrike - https://www.crowdstrike.com Figma - https://www.figma.com MongoDB - https://www.mongodb.com NYSE - https://www.nyse.com Railway - https://railway.com Shopify - https://www.shopify.com/ Follow TBPN: https://TBPN.com https://x.com/tbpn https://open.spotify.com/show/2L6WMqY3GUPCGBD0dX6p00?si=674252d53acf4231 https://podcasts.apple.com/us/podcast/technology-brothers/id1772360235 https://www.youtube.com/@TBPNLive

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

• 0:01John Coogan?

  We have a very special show for you today because we have Tyler Cosgrove guest hosting. He's here in

• 0:07Speaker 01

  Great to be here.

• 0:08John Coogan?

  Chair. And I know I'm gonna make mistakes today because I always throw it over to Jordy. I gotta remember this. Tyler, it reminds me of this video from Warren Buffett. We gotta play it to show what I'm going through emotionally today without Jordy in the TVP and Ultra Dome. Let's pull up this video of Warren Buffett throughout the years at the Berkshire Hathaway shareholder meetings. Warren Buffett always goes to Charlie after he gives his comment. He, he, he, he gives his speech and then he kicks it over to Charlie. Through the years. Charlie.

• 0:41Speaker 01

  Charlie.

• 0:42John Coogan?

  Charlie. Tear jerker.

• 0:44Speaker 01

  Yeah, makes me wanna cry.

• 0:45John Coogan?

  It's emotional.

• 0:48Speaker 01

  Charlie, me.

• 0:52John Coogan?

  That's Greg Abel. So if that happens today, I apologize. But the first big story is of course, Thinking Machines new model has released. Miramarati's AI startup released its first model in bid to loosen AI giants' grip. We're gonna be talking about open source, closed source, where the frontier is, national geopolitical model moves.

• 1:13Speaker 01

  And some people had an idea this was gonna happen, some inkling.

• 1:16John Coogan?

  Oh, they had an inkling.

• 1:17Speaker 01

  That, yeah, that they're gonna

• 1:17John Coogan?

  Did they? I didn't have an inkling that they were going to jump into the open source.

• 1:21Speaker 01

  I think it's actually, I think it makes a lot of sense, given the Tinker API, right?

• 1:24John Coogan?

  Okay.

• 1:25Speaker 01

  The whole business is, is, you know, you're doing fine tuning on open source models.

• 1:28John Coogan?

  Yeah.

• 1:28Speaker 01

  It makes a lot of sense that they're gonna have their own.

• 1:30John Coogan?

  Yeah.

• 1:30Speaker 01

  That, you know, you can easily

• 1:32John Coogan?

  It's sort of like, they are set up as a business to launch an open source model without it degrading any other piece of their business because the Tinker API, that fine tuning that they do, that integration with the customers that they have actually benefits from open source.

• 1:49Speaker 01

  Yeah.

• 1:49John Coogan?

  And then they can go to their clients and say, look, you know, it's the red hat model. At any time, you can leave because we are giving you the weights of the model, open source. You can do whatever you want with them, but keep working with us because we're helping you a bunch and we're making money in the process. So Thinking Machines Lab, first, the first model is an open weights model designed to chip away at the lead of OpenAI and Anthropic, says the Wall Street Journal. Former OpenAI Technology Chief Miramarati is betting on more customizable artificial intelligence models to chip away at the lead that the frontier labs, such as her former employer, hold over the technology. TML, a company led by Maroti, released its first AI model Wednesday and did it with open weights, meaning that others can modify it with their data.

• 2:28John Coogan?

  Called Inkling, the model has 975 billion total parameters, making it far smaller than estimates of the most advanced closed source models.

• 2:37Speaker 01

  So only, I think the number is 41 billion of those are actually like

• 2:40John Coogan?

  Active at any moment.

• 2:41Speaker 01

  Yeah. So this is definitely on the, on the bigger side of open source models.

• 2:44John Coogan?

  Yeah.

• 2:45Speaker 01

  But like that number, it's not, these aren't like dense models, like what you traditionally think of

• 2:48John Coogan?

  Sure.

• 2:49Speaker 01

  Of the models, like, you know, four years ago.

• 2:51John Coogan?

  Yeah, yeah. The Miramarati told the Journal, "We trained it to be a broad, balanced foundational, foundation model, strong across many domains, flexible enough to adapt. Inkling is not the strongest overall model available today, open or closed," which is a different frame of reference for many of these model launches. There's, it's been, everyone's been jockeying for the frontier, even if they're not world-class at everything. Usually when they launch, they say, oh, well, we're best at something or we're best at this. But a different tone, different communication strategy. And I think it's being well received. I think people are having fun with the reaction.

• 3:29Speaker 01

  Yeah, I mean, I think the main picture is that this model is like uniquely set up for the Tinker API. It's built to be fine tuned.

• 3:36John Coogan?

  Sure, sure.

• 3:36Speaker 01

  That's the whole point.

• 3:37John Coogan?

  Got it. DeeDee Das says, "Thinking Machines just dropped the best open weight AI model outside of China." And obviously that is a big topic of conversation as business leaders in the United States have some policies and some reticence about using Chinese open source models. Even if they're not worried about the dystopian, you know, Manchurian candidate hidden inside the weights, maybe they just want to be aligned with a US-based company for a variety of reasons. Inkling beats Nematron 3 Ultra and benchmarks put it between Kimi K 2.5 and 2.6. Of course, there's also news today that Kimi K 3 will be launching and is another jump forward.

• 4:17John Coogan?

  But there's back and forth between some AI researchers around what's going on there, how long that strategy will continue. So DeeDee says, "Many were contending to this throne, but Thinky has come out on top. Really solid release and will pair well with Tinker." So there are some benchmarks that you can go and dig into if that's your thing. There's another very bullish take from Jack Morris of Ingram Labs. He says, "People are under, are underestimating what a big deal this is. This is the only open weight model that, that's trained without distilling for OpenAI, from OpenAI or Anthropic. Kimi distills, GLM distills, Quen distills, Nematron distills, Kimi and DeepSeek, which count.

• 5:00John Coogan?

  Basically a fully different tech stack, the first pure open frontier coding model, very exciting." And there's a community note on this. Can you break down exactly like where are they standing on the shoulders of giants? Where are they not?

• 5:13Speaker 01

  So I think this tweet is not exactly true. In the blog post, they say, "To bootstrap post-training, we ran an initial supervised fine-tuning on synthetic data generated by open weight models, including Kimi K 2.5."

• 5:25John Coogan?

  Okay.

• 5:26Speaker 01

  So I think that's like generally how people think of like distillation, that they mean something related to this. So I think that actually is not that different than what people like, you know, at Nvidia with Nematron did.

• 5:38John Coogan?

  Sure.

• 5:38Speaker 01

  So this is not like very new, I think.

• 5:40John Coogan?

  But it's sort of like the lightest touch of distillation that could happen because it's just one piece of the pipeline.

• 5:47Speaker 01

  Sure.

• 5:47John Coogan?

  One small amount of data.

• 5:48Speaker 01

  Yeah.

• 5:49John Coogan?

  It's not one of these scenarios where we're like, why is it identifying as Claude? Or why is it, why is it just saying that it's ChatGPT?

• 5:56Speaker 01

  But it is funny because you can kind of say like, oh, well, if this is like kind of distilled on, on Kimi and Kimi's kind of distilled on closed source.

• 6:02John Coogan?

  Yep.

• 6:03Speaker 01

  Well, then maybe you get some kind of two-layer distillation.

• 6:05John Coogan?

  This sort of round trip loop.

• 6:06Speaker 01

  Yeah, yeah.

• 6:06John Coogan?

  At the same time, there's probably something to be said for the more layers of abstraction, the, the, the more, you know, ingredients you pour in, like the distillation becomes weaker and weaker.

• 6:17Speaker 01

  Yeah. And I think there's also an important question of like, well, okay, they're doing some level of distillation, like why? Because you can either be like, well, they're just doing it to save time, whatever. Like obviously they have these capabilities.

• 6:27John Coogan?

  Yep.

• 6:28Speaker 01

  But there's no point in, in, you know, doing everything over again. You might as well just, just use what's out there already. Or is it because these capabilities that they get from this, this, you know, distillation light, whatever it is?

• 6:39John Coogan?

  Yeah.

• 6:39Speaker 01

  Are those actually super imperative to the model like being good?

• 6:42John Coogan?

  Ingram says, "Our founder, Jack Morris, recently issued some unfounded claims that got community noted. We deeply apologize for the confusion caused by his original post, the follow-up post, and the follow-up to the follow-up post. Nevertheless, we stand by his conviction in his own takes and in strong open source models like Inkling." And there is a question of like, distillation is a vague term where it's not a binary thing.

• 7:04Speaker 01

  Yeah.

• 7:04John Coogan?

  And if it's not in the pre-training data, does it count?

• 7:07Speaker 01

  I think it's also very much this, this mean people love to talk about on X.

• 7:10John Coogan?

  Yeah.

• 7:10Speaker 01

  They like to kind of, you know, scapegoat it. Oh, you know, it's all distillation. That's the only reason Chinese models are good.

• 7:15John Coogan?

  Yep.

• 7:15Speaker 01

  Is that actually true?

• 7:16John Coogan?

  Well, I mean, Anthropic's head of national security policy, Taran Chabra, accused Zepu, Z.ai, of distilling both Claude and OpenAI models for GLM 5.2 at the Aspen Security Forum earlier this week. This is from Vincent Chow, senior AI reporter at SCMP. He said, "It's the first time that they've named Zepu specifically after previously calling out DeepSeek, Alibaba, Moonshot and Minimax. Join the, join the club at this point."

• 7:45Speaker 01

  Yeah.

• 7:46John Coogan?

  Also accused, they also accused DeepSeek of continuing its adversarial campaign of distillation. Anthropic is now shutting down distillation accounts on the order of millions of accounts of per week. That is crazy scale. You have to, I mean, you always think about it as like, oh, there's like shut down that one company or shut down that one block of IP addresses. But when there's a really, really distributed attack, we've even heard about whole companies that just like resell Claude tokens or, or GPT's 5.6 tokens. And that looks like a reasonable business because it's just a wrapper company. Of course, you wanna work with them, but then you don't realize that on the other side, who are their customers? Why do they, why did they get to 100 million run rates so quickly?

• 8:30John Coogan?

  Well, maybe it's a lab that's trying to distill through this pass-through entity. And of course, it's hard to like watermark the tokens once they go out the API and they get passed through some other system and they can go through other countries, all sorts of things. So millions per week, that is crazy. That's gotta be really difficult to, it's a game of whack-a-mole. They say, "GLM is, quote, 'probably the most advanced Chinese model on the market now, which poses significant cybersecurity challenges.'" They hinted that Anthropic will expand access to Mythos to ensure fair fight for cyber defenders. And they said that distillation challenge is real in shrinking US a lead in AI, suggesting that the US government could do more to clamp down on Chinese model adoption globally

• 9:13John Coogan?

  by working with allies similar to trusted telecom efforts like Huawei and ZTE. So obviously a hot topic and people will be debating how, how, how, exactly how heavy of a hand the government should be putting.

• 9:26Speaker 01

  Yeah, I think this, this release is also, makes a lot of sense. And I think it was a week ago, there was that article about Like Beijing is looking at curbing overseas access to Chinese top AI models.

• 9:36John Coogan?

  Yeah.

• 9:36Speaker 01

  Right? So you're not going to be able to access the Chinese open source, right? It makes a lot of sense to to start doing American open source, Western open source.

• 9:42John Coogan?

  Yeah, it really does feel like there's a pretty.

• 9:44Speaker 01

  It feels very well timed.

• 9:45John Coogan?

  Yeah, there's it seems like there's a pretty wide gap with between at least what's reported preferences from Beijing, from the actual government and the companies. The companies are like, yeah, send us all the Nvidia chips. Let's distill everything. Let's and then let's open source these models and compete internationally. And Beijing's like, hey, maybe we need like, you know, an indigenous supply chain here. Maybe we need to, you know, lock down these models, keep our lead over here, go work internally. I don't know. This was an interesting post from Grace Lee. She she asked the question, how did OpenAI Soul finally learn design taste? She projected a thousand websites by GPT 5.6 soul into a design manifold and discovered big holes.

• 10:28John Coogan?

  These holes were where GPT 5.5 previously generated outputs outputs with, quote, bad AI smell. So there were, you know, there's these tells in any AI model, but it's not this. It's that the M dash. Once people start identifying those as, ah, we don't like that. It's too AI, it's too generic. One way it appears to actually sort of beat that out of the model is to actively avoid those specific things. And then she calls out three particular areas that have been avoided as anti-patterns. One, the bento box layout in dashboards. Two, large typefaces in hero images. I did realize that that sometimes you would ask for a website and you would just get a massive block of huge text.

• 11:12John Coogan?

  And that's just not the way you when you land on a beautiful website. It's usually there's more wordsmithing, there's more.

• 11:18Speaker 01

  Yeah, yeah.

• 11:19John Coogan?

  terse language.

• 11:19Speaker 01

  Well, you know, you you make your first website with with five, six hole or whatever, and it looks really good.

• 11:23John Coogan?

  Yeah.

• 11:24Speaker 01

  And then you make 10 and they're like, oh, okay, there's actually a lot of patterns I'm I'm seeing.

• 11:27John Coogan?

  Totally, totally.

• 11:27Speaker 01

  And you can start clocking them like everywhere you see.

• 11:29John Coogan?

  Yeah.

• 11:29Speaker 01

  A lot of like claudisms, whatever, on general design.

• 11:32John Coogan?

  Especially.

• 11:33Speaker 01

  You see them everywhere.

• 11:33John Coogan?

  Yeah, especially if you don't come with.

• 11:35Speaker 01

  You know, it's like the the, you know, high border radius on the edges. There's a little color on the.

• 11:40John Coogan?

  Yeah, yeah, yeah. Especially if you don't come with like an opinion. If you come like, we made a whole vibe coded website in Codex for just the latest episode of Nick Bostrom on Joe Rogan. And I wanted it to look like a UFC fight card and a fight promotional website. And it doesn't look like any like normal AI slop. I mean, there's still like AI generated images. It looks like AI, but it doesn't look like, oh, yes, that's the bento box layout or that's the offset layout or that's the purple or it's stealing from linear. It it's a completely different style. So if you at least inject like one reference point, you'll usually land somewhere.

• 12:18Speaker 01

  Yeah, I mean, it is interesting, though. This makes it seem like the new model is not necessarily, it doesn't have like higher variance with outputs it gives, but it we basically just found like, oh, there's certain examples that people really don't like. Let's just remove those. But you're not necessarily like making the model more creative by you're by removing these like patterns it always comes to.

• 12:36John Coogan?

  Yeah, well, you're giving like the the flavor of creativity and maybe that's.

• 12:42Speaker 01

  Yeah, but you can imagine if we kind of keep the same model for six months, we'll just notice new patterns.

• 12:47John Coogan?

  Totally.

• 12:47Speaker 01

  And you'll have this kind of.

• 12:48John Coogan?

  But at the same time, like mid-journey had like a very distinct look and people like that look, at least some people. And so if you can, if you can quickly personalize and customize and land in a place where someone whose job is designing dashboards is happy every time with the layout. Like, there is somewhat of a platonic ideal for some of these design patterns. And at the same time, if you're, yeah, working on certain, like, there there are certain designs that are just like solved, like, you know, make the call to action green, blue, not red, right?

• 13:25Speaker 01

  Yeah.

• 13:26John Coogan?

  And so some of those like do need to be consistent. And then also, I imagine that many folks who are using these tools like in enterprises are doing, even if it's not a fine tune, they're uploading a reference for everything that they're designing. So it's consistent with the brand that they've designed.

• 13:41Speaker 01

  Yeah.

• 13:42John Coogan?

  Anyway, California Forever lost a $3.2 billion shipyard project from defense startup Sironic after the company chose the port of Brownsville, Texas over Solano County. I was, oh, no, you're not supposed to clap for that. We got a Texan in the studio who's happy about that. This is bad news for California. We want California to have a whole bunch of amazing stuff. Brandon Goral, who wrote the newsletter, tbpn.com, today, was very disappointed about this. The automated shipyard, known as Point Alpha, Port Alpha, is expected to create roughly 10,000 permanent jobs, along with thousands of union construction jobs. Supporters say California's lengthy approval process ultimately cost the state one of

• 14:24John Coogan?

  the first marquee tenants that California Forever had appointed to as evidence its planned city could anchor a new era of American shipbuilding. Joshua, executive director for the California Alliance for Jobs, said California failed to move with the urgency the product required, quote, while Texas moved quickly and aggressively. Thank you, Jackson. California could not provide clear expedited approval process needed. He said, calling the decision an enormous loss for Solano County, California workers, and our state's manufacturing economy. Earlier this year, California Forever signed a 40-year construction labor agreement covering 70,000 acres, and labor groups later backed legislation to fast-track environmental review and permitting for the proposed shipyard the legislation has yet to advance.

• 15:07John Coogan?

  Instead, Texas approved a $211 million tax abatement package in June to secure Sironic's investment at Brownsville, roughly 20 miles from Starbase. Labor leaders said they warned that without expedited approvals, the project would leave the state. And that is exactly what happened. A project insider told the San Francisco Chronicle that California Forever itself remains on track, but acknowledged that losing a major defense contractor sends a powerful signal about the state's ability to compete for large industrial investments. Very disappointing, but I like Yan, I like the California Forever project, and I'm excited for where he takes it next. I'm sure he's on the hunt for the next major tenant.

• 15:46Speaker 01

  Gotta talk about TSMC.

• 15:48John Coogan?

  Yes, TSMC. TSMC both beat earnings and raised their capex guide. They're spending a lot more money and.

• 15:57Speaker 01

  Fledged to invest an additional 100 billion in the US.

• 15:59John Coogan?

  Yes.

• 16:00Speaker 01

  Plans to spend a record amount, cementing its position atop the global semiconductor supply chain.

• 16:04John Coogan?

  Yes. But and and yeah, and they're they're investing another 100 billion in in Arizona fabs. But people are worried about overspending. The news is that the NASDAQ dropped 1% on TSMC's spending plans, offset by strong results. Very, very odd story that in a time when even TSMC, which was not a particularly AGI pilled company for a long time, since they've been through the smartphone boom, the so many booms and busts, so many cyclical build out cycles, that when they are finally like, yes, now is the time, people are, I don't know. They're skeptical. In creator world, there is some news from Colin Samir.

• 16:46John Coogan?

  Lexus is now the official car of Colin and Samir. What does that actually mean? They made four ads for them that roll across the rollout across YouTube. They're sponsoring four videos on their channel. It's the first of its kind deal that represents broader shift taking place in media, the aperture of what it means for a brand to work with the creators changing quickly. It's very cool to see because obviously they've been on YouTube for a long time. They've done a lot of like host read ads, mid-roll ads, but this is a much deeper integration and something that I think will be hopefully replicated all over YouTube and be a new source of revenue for for creators of all kinds. So I was excited to see this.

• 17:29John Coogan?

  In other entertainment news, Jake from Econompic says, this is almost hard to believe. Disney spent $129 billion acquiring Marvel, Star Wars, Pixar, ESPN, and Fox, which is $182 billion in today's dollars. Throw in all their legacy assets and the entire company's market cap today is $169 billion.

• 17:53Speaker 01

  Wow.

• 17:53John Coogan?

  Do you know what this picture is missing?

• 17:55Speaker 01

  Which, what do you mean?

• 17:57John Coogan?

  So so they're saying they acquired all these assets and the company is only worth $169 billion. What's missing from this analysis? The cash that's been returned to shareholders. Disney across dividends and buybacks has returned like 70 billion, maybe more, to shareholders, which is, I don't know, I just saw this.

• 18:18Speaker 01

  They're giving up for shareholders.

• 18:18John Coogan?

  And it is, it is, it is an interesting angle because they have spent a lot acquiring and the company is not worth more than what they acquired. So there's this question of like, were those were those acquisitions accretive or destructive or dilutive? But there is a whole separate picture, which is that a lot of cash has been returned to shareholders throughout this journey.

• 18:38Speaker 01

  Yeah, also, I mean, that's the mechanism with with with which those acquisitions were funded also.

• 18:42John Coogan?

  Yeah.

• 18:43Speaker 01

  Should.

• 18:43John Coogan?

  Yeah, matters a lot. I don't know. It was sort of interesting. Sean Frank has a pitch. He says you should move to New York City. Bro, you got to move to NYC. The weather, horrible, 100 degrees, easy. AC, F that. Taxes, so high. Rent, highest in the country. Air quality, some of the worst in America. Tech, bro, we banned. Do they really ban Waymo in New York?

• 19:04Speaker 01

  I believe so, yeah, there's no Waymos.

• 19:06John Coogan?

  Wow, that's very wild. Yeah, if you can make it here, you can make it anywhere. So I don't know. Do you ever have aspirations to move to New York City?

• 19:15Speaker 01

  At some point, it seems.

• 19:16John Coogan?

  You've been to New York City.

• 19:17Speaker 01

  Yeah, yeah.

• 19:18John Coogan?

  It's a nice city. That's the thing is that all of this is true and it's still a great city to hang out in. It's so fun, so dense, you can see so many people walk around, it's beautiful. It's just like, I don't know, it's unlike anything else. Still great, but yeah.

• 19:31Speaker 01

  You've never lived in New York City.

• 19:32John Coogan?

  I've never lived in New York City, but I've spent like a lot of time there. So I've had a good time. Thank you to everyone who tuned in in the chat. Thank you for positive reviews of Tyler. Let us know what you think of Tyler. Leave us a review on Apple Podcasts and Spotify. Write us an email. Tell us how he did. I think he did fantastically.

• 19:51Speaker 01

  Have the best Thursday of your life.

• 19:52John Coogan?

  Yes, there you go. That's a good impression. That's a good impression. But but thank you. Sign up for newsletter at tbpn.com and we will see you on Monday.

• 20:01Speaker 01

  See you.

• 20:01John Coogan?

  Goodbye.

• 20:04John Coogan?

  Oh, we got the flashbang. There we go.