Trump’s Plan To "Make America First in AI Defense"

TECH IN THE NEWS

Quarter Point — The Federal Reserve cut its benchmark interest rate by 0.25bps amid economic uncertainty following Donald Trump’s decisive election victory.

Trump Pump — The Bitcoin spot price surged above $76,000 on wednesday to hit an all-time high. Cryptocurrencies and related equities broadly, with Coinbase shares up 33%, and Robinhood shares up 20%.

Chopra Gets Chop? — A 2020 Supreme Court decision paved way for Trump to fire CFPB head Rohit Chopra, a consumer groups hero, almost immediately.

Let’s Chat — OpenAI acquired the domain Chat.com, to redirect it to ChatGPT. The domain was worth ~$15.5M, so it could be the largest domain purchase ever.

World's Largest Company — AI chipmaker Nvidia is now the world's largest company, surpassing Apple this week with a $3.43T market cap.

Smart Vision — Apple is exploring the feasibility of smart glasses. | 2. OpenAI just hired Meta’s former hardware lead for AR glasses, to lead robotics and hardware.

COMPANIES TO WATCH

Perplexity — The San Francisco AI search engine startup is raising a $500M round at an estimated $9B valuation led by IVP, in its fourth round this year.

Precision Neuroscience — The New York brain–computer interface startup has raised $93M of a planned $100M round at a $500M valuation. It aims to treat neurological conditions such as paralysis and neurodegenerative diseases.

Zodia Custody — The London startup providing secure digital assets storage and management services to institutional investors, is in the market to raise $50M.

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THE HOTTEST THING IN TECH
Trump’s Plan To "Make America First in AI Defense"

Trump’s well-known foreign policy isolationism policies were reinforced after he vowed to “stop wars” in a victorious speech Wednesday morning. Beyond the rhetoric, his term is likely to be a transformative time for the Defense industry, re-focusing energy on AI-driven efficiency and technological advancement. His proposed AI-focused "Manhattan Projects" prioritizing AI development for military purposes is also an indication Trump sees the real defense goal as defeating China in the AI race.

The "Manhattan Projects"

Trump allies developed an executive order this year titled "Make America First in AI," to advance military technology and reduce regulatory burdens on AI development. It seeks to launch a series of "Manhattan Projects" and would favor Silicon Valley investors and companies by establishing industry-led agencies to evaluate AI models and protect systems from foreign threats. Key beneficiaries of the project would include AI defense contractors like Anduril and key Trump ally Peter Thiel’s Palantir.

Anduril had one of the largest US raises this year with its $1.5B August round at a $14B valuation post-money. It is now building a massive manufacturing facility called "Arsenal-1." employing thousands and producing tens of thousands of autonomous military systems annually. Anduril and Palantir already have a joint $178M army contract to deliver space sensor and AI-enabled military trucks and other hardware. 

Foundational AI companies will also benefit. Anthropic just partnered with Palantir and Amazon to provide U.S. intelligence and defense agencies with access to its Claude AI models. This collaboration aims to operationalize Claude within Palantir's platform, hosted on AWS, specifically targeting defense-accredited environments handling highly sensitive national security data.

Meta also changed its policy to allow government agencies in the US and key allies, as well as contractors, to use its Llama models for natsec purposes. The company is working with Lockheed Martin and Palantir to make Llama accessible for tasks such as tracking terrorist activities and enhancing cybersecurity. However, Meta's open-source approach has faced scrutiny due to concerns about potential misuse, after reports of unauthorized use by Chinese research institutions for military applications.

The Musk Militia

Another big winner will be Elon Musk’s SpaceX and xAI, as Musk looks likely to head up Trump’s Department of Government Efficiency (D.O.G.E). In this job, he aims to apply his business acumen to streamline government operations, reduce spending, and potentially cut jobs in part by use of AI. NYT reported that prior to the election, Musk advised Trump to hire prominent SpaceX officials as high-ranking government employees, including at the Pentagon. The NYT says that Musk could play a similar role to that Peter Thiel played in Trump’s 2016 transition team and eventually the government, seeding the DoD with key allies and setting a strategic direction.

Musk’s six companies are already deeply entangled with federal agencies and make billions off rocket launch, satellite building and space-based communications contracts. However, in October SpaceX revealed it is expanding into military and spy satellites, capitalizing on the Pentagon's push to counter China's space-based military systems. It is highly likely that xAI will somehow be involved in providing the AI compute to deliver on this. A loser from this could be OpenAI’s Sam Altman, with Musk making no secret of his dislike for leadership direction at the helm.

The Regulatory Debate Settled? 

A debate has been underway in Silicon Valley and D.C. regarding the ethics and implications of fully autonomous weapons. While some defense tech leaders like Shield AI's Brandon Tseng express opposition, others like Anduril's Palmer Luckey and investor Joe Lonsdale are open to their use to take on China and Russia. Trump’s election likely clears the way for the sector to go full steam ahead on Defense AI.

The "Palantir for Contracting" 

Another interesting defense tech startup founded by Palantir and Lockheed Martin veterans is Pryzm. It aims to simplify the complex world of government contracting. It offers a data-driven platform that helps companies identify lucrative contracts, understand key decision-makers, and navigate the often opaque bidding process by aggregating data  into a personalized dashboard.

Footnote: So what is China up to? Just this week, Chinese scientists claim to have developed an advanced directed-energy “Death Star” weapon capable of focusing multiple “high-powered microwave” beams onto a single target in space or on earth.

TRENDING TOOLS AND BUZZY TECH
Tools

Apple — iOS 18.2 to offer GPT-4o to improve Siri + offer apps screen awareness.

Google — Jarvis AI 'onscreen awareness' tool leaked. It may be out next month.

JPMorgan — Rebrands ‘RWA’ token platform + adds blockchain foreign exchange.

Microsoft — New Notepad AI editing + AI tools for Paint begin roll out.

Agora — Cross-platform ‘multiagent’ protocol, simple comms between LLM agents.

Tech

MIT — Breakthrough semiconductor tech cuts data storage power use by 1Bx

Carnegie Mellon — Human body ‘power-over-skin’ tech runs a variety of devices.

Nvidia — New robotics AI & simulation tool suite + partnered with Hugging Face.

Saudi Arabia — $100B AI initiative invests in data centers, startups, & infrastructure.

Robotaxis — 1. Alphabet's self-driving car unit Waymo raised $5.6B at $45B. | 2. Lyft partners with May Mobility and Mobileye to offer robotaxis on its app in 2025. 

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