E87: 5/18/25
OpenAI stays non-profit, Microsoft/OpenAI enter tense negotiations, Saudi Arabia funds a new national AI company with $700B, Meta delays its newest LLM, OpenAI goes international, and so much more
Enormous AI update this edition, since I missed last week, and the world keeps turning fast!
PNW AI News:
OpenAI and Microsoft are in "high stakes negotiations", reworking the terms of their $13B partnership, as OpenAi restructures as a for-profit to prepare for a potential IPO (more below)
OpenAI is aiming to reduce Microsoft's revenue share from 20% to a share of 10% by 2030, when OpenAI forecasts $174B in revenue
Box tightens its partnership with Microsoft with a new Microsoft 365 Copilot integration for document storage, and builds out its own suite of AI agents for pulling data from those docs
Amazon is developing its own AI coding app, code-named ‘Kiro’, which will leverage AI agents for developer tasks and feature multimodal capabilities
Microsoft has laid off around 6,000 employees, 70% disproportionately targeting software engineers, as it ramps up spending on AI infrastructure and offloads junior and mid-level software development roles
Amazon.com launched Enhance My Listing, a new AI-powered tool that helps sellers maintain and optimize product listings
A new study from Microsoft and Salesforce researchers found that LLMs significantly underperform during multi-turn conversations where user instructions are gradually revealed, often getting “lost” and failing to recover
Microsoft president Brad Smith revealed that the company’s employees are banned from using DeepSeek models, citing propaganda and data security concerns
Key AI Product/Research Updates:
Saudi Arabia has launched a new AI company called Humain, backed by the $700B Public Investment Fund (PIF) and chaired by Crown Prince Mohammed bin Salman, focusing on Arabic-language models, massive local data centers, and plugging the Kingdom deep into the global AI supply chain
xAI identified an unauthorized modification to Grok’s system prompt that caused it to repeatedly reference “white genocide in South Africa” in unrelated 𝕏 conversations on May 14
This follows a February incident where a rogue employee altered Grok to censor mentions of Elon Musk and Donald Trump
Google just announced a major expansion of its AI assistant, with plans to bring Gemini to more Android devices and platforms like smartwatches, TVs, cars, and upcoming XR headsets
Sakana AI unveiled Continuous Thought Machines (CTMs), a new type of model that makes AI more brain-like by allowing it to “think” step-by-step over time instead of making instant decisions like current AI systems do
OpenAI released a new GitHub connector for its Deep Research feature, allowing the tool to leverage and answer questions about codebases
AI coding platform Windsurf just launched SWE-1, its first family of in-house AI models specifically designed to assist with the entire software engineering lifecycle, not just code generation
Apple has partnered with Anthropic to create a "vibe-coding" platform for automating code generation, editing, and testing
OpenAI launched its "OpenAI to Z Challenge," inviting participants to use its models to help uncover archaeological sites in the Amazon rainforest for a $250k prize
OpenAI Releases “Codex”, an AI agent designed to run multiple tasks in parallel and assist with complex coding workflows, initially available to ChatGPT Pro
Google released an early preview of Gemini 2.5 Pro I/O Edition, an update that dramatically improves coding and web development capabilities
Chrome’s On-Device AI, embedded as 'Gemini Nano', catches scams in real-time on Android and desktop devices
Mass General Brigham’s researchers just introduced FaceAge, an AI tool that can estimate a person's biological age and improve cancer survival outcome predictions simply by analyzing their facial photograph
Meta has postponed the release of “Behemoth,” its next-generation AI model, after engineers flagged disappointing training outcomes
It was originally set for April, then June, and now the release is now delayed to fall
Meta did have two other notable releases:
Meta launched OMol25, a massive dataset of over 100M quantum chemistry calculations across biomolecules, organics, metal complexes, and includes spin, charge, and conformational data design for drug discovery use cases
Meta introduced UMA, which predicts atomic-level chemical properties with high speed and accuracy across diverse molecular tasks,ed to support AI-driven drug discovery and materials R&D
Google announced AlphaEvolve, a coding agent that harnesses Gemini and evolutionary strategies to craft algorithms for scientific and computational challenges
Anthropic is reportedly preparing to launch advanced versions of Claude’s Sonnet and Opus models in the “upcoming weeks,” featuring hybrid thinking and expanded tool use capabilities
OpenAI launched a new Safety Evaluations Hub that will publicly and regularly display test results for its AI models
Google's Chief Scientist Jeff Dean says we're a year away from AIs working 24/7 at the level of junior engineers
Alibaba researchers introduced ZeroSearch, a technique that teaches AI systems to search for info without using real search engines, cutting training costs by 88%
French AI startup Mistral released Medium 3, a new AI model that delivers high-end performance at drastically lower costs
Key AI Business/Investment Updates:
Over 250 tech leaders and CEOs from major companies just signed an open letter urging U.S. states to offer AI and computer science courses and make the subjects mandatory graduation requirements in high school
Newly appointed Pope Leo XIV identified AI as one of humanity’s most pressing challenges in his first major address, continuing his predecessor's focus on the ethical implications of the technology
OpenAI’s massive Stargate initiative (backed by SoftBank, Oracle and MGX) will deploy AI supercomputing hubs worldwide under the banner of “democratic AI”
It is done by new program "OpenAI for Countries," a global initiative to help nations build out their AI infrastructure and customize AI tools for local needs
Softbank’s $100B commitment towards OpenAI’s Stargate is reportedly being stalled with fears over U.S. tariffs and rising data center costs
At a Senate hearing, OpenAI’s Sam Altman, AMD’s Lisa Su, CoreWeave’s Michael Intrator and Microsoft’s Brad Smith pressed for streamlined permitting of data centers, power plants and chip fabs to underpin the AI tech stack
Klarna CEO revealed the fintech giant cut 40% of its workforce due to AI, but now plans to hire human agents after a hit on work quality, reversing his decision
Yikes!!!!
The Trump administration rescinded a Biden-era rule that would have imposed controls on semiconductor export worldwide, opting instead to develop an approach focused on country-specific agreements while keeping restrictions on China
OpenAI is reportedly set to acquire coding platform Windsurf (previously named Codeium) for $3B, which would be the AI giant’s largest acquisition to date
OpenAI just announced the hiring of Instacart CEO Fidji Simo as its CEO of Applications, creating a new leadership position that will oversee the company's product offerings and business operations
NVIDIA and AMD are securing AI chip deals in the Middle East, supplying Saudi Arabia’s Humain and the UAE after meetings with the Trump admin and other regional leaders
OpenAI walked back on its plans for for-profit restructuring. According the OpenAI Board on May 5th:
"OpenAI was founded as a nonprofit, and is today overseen and controlled by that nonprofit. Going forward, it will continue to be overseen and controlled by that nonprofit.
Our for-profit LLC, which has been under the nonprofit since 2019, will transition to a Public Benefit Corporation (PBC)–a purpose-driven company structure that has to consider the interests of both shareholders and the mission.
The nonprofit will control and also be a large shareholder of the PBC, giving the nonprofit better resources to support many benefits.
Our mission remains the same, and the PBC will have the same mission."
Microsoft is reportedly a major holdout in OpenAI’s announced restructuring
Perplexity is raising a new $500M round of funding at a $14 valuation, up from its $9B valuation in December 2024
Salesforce is acquiring AI agent startup Convergence AI, with plans to integrate the team and tech into its Agentforce platform
CEO Sam Altman, in an interview with Sequoia Capital forecasts 2025 as the year of working AI agents, 2026 as a tipping point for scientific breakthroughs, and 2027 as the dawn of economically useful robotics.
PNW AI/ML/CV Fundings:
Unblocked (Vancouver, BC) raised $20M in Seed funding from Radical Ventures and B Capital
AI coding assistance tool intended to simplify the code-writing process with context of the edit history – TFTD $20M
CEO: Dennis Pilarinos
Elastix (Seattle, WA) raised $16M of Seed funding led by FUSE, and joined by Catapult, Tyche, Liquid 2 Ventures, and DNX Ventures
AI inference platform designed to optimize how large language models are run using field programmable gate arrays (FPGAs) – TFTD $16M
CEO: Mohammad Rastegari
CueZen (Seattle, WA) raised $5.2M of seed+ funding from Point72 Ventures, Fortson VC and others
Generative AI personalization engine designed to offer lifestyle data that drives behavior change for improved health outcomes through hyper-personalized nudges – TFTD $12.2M
CEO: Ankur Teredesai
Verdi (Vancouver, BC) raised $4.7M in Seed funding from led by SVG Ventures, with participation from NEC X, Ponderosa Ventures Elemental Impact, GenomeBC, One Small Planet, Waterpoint Lane, Dangerous Ventures, VentureUs, Echo River Capital, Cyan Ventures, Jetstream and Baker Hall Capital
Scalable control systems designed to bring plant-level healthcare and automation to the harshest farm environments with IoT and AI – TFTD $5.3M
CEO: Arthur Chen
Potato (Issaquah, WA) raised $6.6M in Seed funding from Draper Associates, PSL Ventures, Ensemble VC, and more
A fully-autonomous science research Ai agent designed to run science code efficiently – TFTD $6.6M
CEO: Nick Edwards