Aug 7, 2025 5 min read Daily Rundown

⛵ Code of the Hill

More Stories: OffDeal Punked Wall Street, Rivian Got Tariff-slapped

Good Morning, Early Adopters!

Welcome to capitalism, patch 2025. No safety rails. No margin for error. Just vibes, valuations, and very polite bots.

OpenAI Nukes AI Gov Market in the Process

👀 What’s the move: OpenAI just offered ChatGPT Enterprise to U.S. federal agencies for $1 per agency, undercutting Anthropic and Google the day after they all got greenlit as government vendors. The “deal” includes unlimited model access, onboarding support, and a community — basically, a year-long free trial wrapped in a GSA contract.

💡 Why it’s not boring: This isn’t a promo — it’s a platform kill shot. OpenAI isn’t chasing revenue here; it’s playing the lock-in game. By embedding itself early in government workflows, it sets the standard for “acceptable AI” under Trump’s ideologically neutral order — and dares others to bleed cash or lose relevance. If you’re a smaller AI vendor eyeing gov contracts? Good luck surviving a $1 price war.

⛵ Key takeaway: OpenAI isn’t competing — it’s colonizing. And the first territory is Washington.

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OffDeal Just Punked Wall Street

👀 What’s the move: OffDeal just closed a $12M Series A at a $100M valuation, cementing its position as the first AI-native investment bank. The company built custom AI tools to replace analyst teams, automating 80% of the M&A workflow — from due diligence to buyer outreach. Each deal runs with just two people: one junior, one senior. That setup allows bankers to handle up to 10 deals at once. This isn’t disruption — it’s a total rewrite of the playbook.

💡 Why it’s not boring: They’re not selling software — they’re selling exits. The real wedge? High-frequency, mid-sized deals ($10M–$100M) that Wall Street ignores because the economics don’t work. OffDeal flips that with AI-powered cost compression, making these deals scalable and profitable.

⛵ Key takeaway: OffDeal drops them into the deal room — automating the grind so humans can close. It’s how you scale what was never scalable.

Rivian Just Got Tariff-slapped

👀 What’s the move: Rivian just raised its projected losses to as much as $2.5B for FY2025, blaming shifting U.S. policy. EV credits are vanishing, tariffs are climbing, and CFO Claire McDonough says each car could cost “a couple thousand dollars” more to build. Regulatory credit revenue? Slashed in half.

💡 Why it’s not boring: The Trump administration’s rollback of EV incentives and bump in tariffs isn’t just politics — it’s strategic sabotage of the post-gas momentum. Startups like Rivian, who built forecasts on yesterday’s subsidies, now face margin erosion and cash flow compression just as they prep their mainstream R2 model.

⛵ Key takeaway: When policy flips, it’s not the incumbents who bleed first — it’s the innovators who bet the farm on a future Washington just rewrote.

STARTUP SPOT

🪙 OffDeal
“AI-native investment bank for small-business exits.”
Platform revolutionizing sell‑side M&A for SMBs ($10M–$100M revenue), using AI to automate pitch decks, buyer matching, bidding, and CRM—letting a lean team focus on high-value deal execution.
→ Founded by Ori Eldarov (ex-RBC, HBS) and Alston Lin (ex-Meta engineer), OffDeal completed ~10 deals with fewer than 10 employees and recently closed a $12M Series A (total funding $17M) led by Radical Ventures (with participation from YC, Rebel Fund, Centre Street Partners) at ~$100M valuation. Targets $100M ARR by 2027 through ~100 deals/year.

🚗 Rivian
“Adventure EVs meet autonomy.”
Premium electric trucks, SUVs & vans with AI-powered driver assist (hands-free by 2026). New zonal compute, built-in OTA updates, R2 SUV launches mid-’26.
→ Founded by RJ Scaringe; backed by Amazon & VW ($1B+); hit gross profit in Q2 ’25; 130k roads now support Enhanced Highway Assist.

🎥 Luma AI
“Building creative, multimodal general intelligence.”
AI startup developing powerful video‑and image‑generation tools—think creative world‑models that understand and act in physical, multimodal contexts. Behind tools like Ray2 (a large‑scale video generator) and Dream Machine, its image‑and‑video creative suite.
→ Founded by researchers bent on “simulating reality” with multimodal AGI. Backed by a $200 million-plus venture push, including a recent partnership with HUMAIN AI to accelerate AGI development.

BAY AREA MEMOS

OpenAI is in talks for a share sale that could value the company at $500bn, making it the world's most valuable private tech group.
AI video startups Runway and Luma are seeking over $1.6 billion in new funding at high valuations despite having modest revenues.
US senators are calling for an investigation into Chinese AI models following arrests related to illegal exports of Nvidia chips.
Apple is suing the small theater chain Apple Cinemas over alleged trademark infringement and consumer confusion.
SoftBank swings to a first-quarter profit driven by gains in its Vision Fund and successful bets on AI stocks like Nvidia.

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