The circular deals in AI are incredibly fishy. There’s been a bunch of circular deals in the past several months. Hear this, Anthropic is planning to spend $30B (with a B) on Azure compute credits to host Claude. These compute (GPU compute) is powered by NVIDIA chips. NVIDIA is investing $5B in Anthropic. Microsoft is investing $10B in Anthropic. It’s not only me, even Wall Street guys are raising their eyebrows.
These type of deals are getting attention because the sheer amount of money that’s involved. This to me is not news. This is how silicon valley companies and VCs been successful. This is how they’ve built and done business for decades. This dawned on to me after hearing this a16z podcast. As a VC you invest in bunch of companies and you have a network of friends who own other companies. You buy and sell shit to each other. Everyone wins. It’s a simple formula.
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