E125: SpaceX launch, Fox News settlement, "Zombie-corn" exodus to AI, late-stage implosion

After the April 20, 2023 Starship test, SpaceX will require at least 2–3 months to rebuild the pad and prepare another Starship/Super Heavy vehicle for the next test launch, with the earliest plausible next launch attempt no sooner than late June to late July 2023.

“it'll take at least 2 or 3 months, 2 or 3 months to really get the pad rebuilt and get another vehicle back on for testing. Uh, maybe longer.” View on YouTube

Within approximately 5–10 years from April 2023 (i.e., by April 2028–April 2033), Starship-based point-to-point transport will eliminate essentially all conventional transatlantic and transpacific air cargo flights, causing those long-haul air cargo routes to disappear.

“There will be no more transpacific or transatlantic cargo flights. I think in five, six, seven, eight, ten years. You're going to need a big Starship fleet to accomplish that. But I think the transatlantic and Trans-Pacific aerospace cargo routes go away.” View on YouTube

By the end of 2026, due to FCC spectrum-license launch requirements that other operators cannot practically meet, SpaceX will effectively have a monopoly on the new generation of satellite broadband capacity and will offer the best global internet connectivity at every natural point on Earth, leaving incumbent terrestrial and satellite telecommunications providers in a financially and competitively difficult position over the following few years.

“The big disruption is going to happen by the end of 2026 because this next generation set of licenses, uh, Spectrum licenses that the FCC sold came with a condition that you had to launch satellite capacity by the end of 2026... The point is that the only company that actually has the capability to build and to launch is SpaceX. So they have a complete monopoly.... you’re going to be left with a bunch of these existing telecommunications companies in a really difficult spot in the next couple of years.” View on YouTube

Over the coming AI-driven technology wave (starting circa 2023), the total economic value created could be roughly 10x the value created during the internet era, but broad-based (index-style) investing in AI startups will lose money overall, with only a small number of companies capturing the vast majority of gains.

“I think we're at a point in time right now where we could see ten times the value generated in this phase of technology advancement than we saw during the internet and the advancement of the internet. And if if that is true, I think you'll end up seeing certainly the same thing happen, which is the index will lose money, but the few winners will accrue such extraordinary gains.” View on YouTube

Over the next few years following April 2023, a large share of late-stage private companies (“zombie-corns”) whose valuations have fallen below their preferred equity stacks will experience recapitalizations that effectively wipe out common equity, prompting a significant exodus of founders and employees from those companies into new AI-focused startups.

“So many of those companies have a valuation that's less than their preference stack. And as a result, those founders that work there and those employees that are there are getting their equity wiped out.... a lot of those employees are going to run. Those founders don't want to go work for the VC's when they get recapped and get offered a 4% equity to go, because it looks like they're going to start AI companies.” View on YouTube

In the AI wave starting in early 2023, dozens (at least 24) of new startup unicorns (valuations ≥$1B) will be created globally over the subsequent ~2 years (by around mid-2025), driven specifically by AI technologies.

“there's a reason now to believe that, say, dozens of unicorns could be created in the next couple of years.” View on YouTube

By around mid-2025, multiple (at least 2 each) AI unicorns will exist in: (1) AI infrastructure (e.g., vector databases, agent platforms) and (2) AI copilot products targeted at specific professional categories (e.g., coding, medicine, law, architecture).

“I do think there will be dozens of new unicorns minted in various aspects of AI. It could be in AI infrastructure... or it could be in AI copilots... I think there's going to be potentially multiple unicorns created in in those categories.” View on YouTube

The film "Dalíland" will be released to the public approximately two months after this April 21, 2023 episode release, i.e., by late June 2023.

“the film is called Dolly. Dolly land. ... [00:58:27.110]: Yeah, coming out in two months.” View on YouTube

The process of major down-rounds/write-downs and loss recognition in late-stage VC portfolios as of April 2023 has barely begun; a substantially larger wave of markdowns and restructurings will occur over the following 1–2 years.

“It hasn't even started. I think we're.” View on YouTube

After April 2023, there will be multiple further major negative valuation events (e.g., large write-downs, bankruptcies, or distressed financings) for tech/biotech companies that went public or raised money at peak 2020–2021 valuations, beyond what had already occurred by that date.

“it's still. Yeah, I think you're right. Chamath is probably a another hammer to drop. [01:19:11.150]: Multiple hammers.” View on YouTube

As of 2023 and for the foreseeable future (through at least the 2024–2025 cycle), the United States will cease to be a viable jurisdiction for building and operating major crypto businesses; most meaningful crypto innovation and company formation will move outside the U.S.

“Crypto is dead in America. [01:21:41.370]: It is dead in America. [01:21:42.770]: Crypto is dead in America.” View on YouTube

U.S. regulatory actions starting by early 2023 will effectively amount to a ban on most significant crypto activity in the United States, causing a substantial share of major crypto companies and new crypto startups to relocate their primary operations to foreign jurisdictions over the next few years (by ~2026).

“I think Chamath is right that they're effectively banning crypto in the United States. They're going to drive all these companies overseas, which is terrible for American innovation.” View on YouTube

Nikki Haley will win the 2024 Republican Party presidential nomination (defeating Donald Trump, Ron DeSantis, and all other Republican primary contenders).

“I think Nikki Haley's going to win the Republican nomination.” View on YouTube