Aug 14, 2025 5 min read Daily Rundown

⛵ Stablecoin War

More Stories: Growth Costs More, Grok Scared CoFounder Off

Good Morning, Early Adopters!

AI founders are fleeing their own creations like it’s Frankenstein 2.0, and growth? Oh, it still costs money—just more of it now.

FINTECH

Stripe and Circle Both Want to Be Visa

👀 What’s the move: Stripe’s L1, Tempo, leaked from stealth. Circle responded by launching Arc—a USDC-native Layer 1. In 24 hours, both Stripe and Circle dropped their own Layer 1 blockchains. One’s sitting on merchant firepower. The other’s trying to turn a stablecoin into settlement infrastructure.

💡 Why it’s not boring: This is no longer about who issues stablecoins—it’s who settles them. Stripe wants to turn every POS into a protocol. Circle’s tired of being the token on someone else’s chain. They’re not sharing rails. They’re building rival tracks—straight into each other.

⛵ Key takeaway: The stablecoin war just moved to the base layer—and it’s not about speed, it’s about who gets to be the toll booth.

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AI CODING

Growth That Bleeds Red

👀 What’s the move: The 2025 balance sheets of AI coding startups are in, and they’re ugly—Replit’s gross margins swing from +36% to –14%, Lovable sits at ~35%, StackBlitz at ~40%. That’s grocery-store territory—40% or less—nowhere near SaaS heaven’s 70–90%. And here’s the kicker: those numbers don’t even include the AI inference costs for free users. If they did, the margins would look far worse. Many of these “AI coding darlings” are effectively losing money just to gain users.

💡 Why it’s not boring: This isn’t just a bad quarter—it’s a structural flaw in the AI coding model. Every user query burns real compute, so scale inflates costs instead of amortizing them. The GPU tax, inference inefficiencies, and a freeloading user base mean growth can be a cash-burning spiral. Without major leaps in model efficiency or bold price hikes, consolidation—or collapse—isn’t a risk, it’s a timeline.

⛵ Key takeaway: In AI coding, “growth hacking” can hack your balance sheet to death faster than stagnation ever could.

STARTUP

xAI Co-Founder Quits Over Grok Free Speech

👀 What’s the move: Igor Babuschkin, who co-founded Elon Musk’s xAI and built Grok into a benchmark-crushing model, is leaving to start Babuschkin Ventures — a VC shop aimed at AI safety research. His pivot follows dinner-table debates with AI ethicist Max Tegmark and months of Grok PR fires, from antisemitic rants to AI-generated celebrity nudes.

💡 Why it’s not boring: Babuschkin’s exit isn’t just a founder chasing “impact investing.” It’s a quiet admission that Grok’s radical free-speech ethos — Musk’s selling point — is also a liability magnet. In the race to be the “uncensored” chatbot, xAI may have coded itself into a corner where technical wins are overshadowed by reputational self-harm.

⛵ Key takeaway: In AI, “say anything” can just as easily mean “end everything.”

STARTUP SPOT

🧠 Safe Superintelligence
“AGI with safety built in.”
Stealth lab aiming for superintelligence, prioritizing alignment over speed to market.
→ Founded 2024 by Ilya Sutskever, Daniel Gross, Daniel Levy; raised $3B+, valued ~$30B; ~50 staff in Palo Alto & Tel Aviv.

💼 Humanloop
“Ship AI you can trust.”
LLM-ops for teams—prompt mgmt, evals, observability to deploy reliable GenAI. → Founded 2020 (YC S20) by UCL/Cambridge ML-PhDs; backed by Index, Albion; used by Duolingo, Vanta. Sunsetting Sept ’25 as core team joins Anthropic.

🛡️ CyberArk
“Identity security for AI & humans.”
Enterprise PAM + AI/ML identity controls for human, machine & agent accounts → Founded 1999; $868M rev ’24, 78% subs; acquired Venafi (’24) & Zilla Security (’25). Launching Secure AI Agents & AI Profiles; pending Palo Alto Networks acquisition.

BAY AREA MEMOS

Fountain Life, the longevity firm co-founded by Tony Robbins, secures $18 million in new funding to grow its network of preventative health centers.
Anthropic has acqui-hired the team from AI tooling startup Humanloop to bolster its enterprise and AI safety capabilities.
Chinese AI startup DeepSeek delayed its new model after Huawei chips faced stability, speed, and compatibility issues in training.
Driven by demand from large tech companies, Cisco's AI sales hit over $2 billion in fiscal 2025, more than doubling its initial forecast.
Palo Alto Networks announces a $25 billion deal to acquire CyberArk, aiming to complete its platform strategy and secure agentic AI.

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