Sam:
Some big shifts are happening in tech and science. AI investments are scaling to unbelievable levels. Social media is breaking apart in unexpected ways, and cancer research is making real strides toward personalized treatments. Welcome back to the Tech Optimist, where we break down the breakthroughs shaping the future. Today we're covering an AI arms race, the unbundling of social media, and a major breakthrough in cancer vaccines. You heard me right now. This episode is packed with insights you won't want to miss, so let's get started. Real quick, we've got an ad and a disclaimer. We'll be right back.

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Sam:
As a reminder, the Tech Optimist podcast is for the informational purposes only. It's not personalized advice and it's not an offer to buy or sell securities for additional important details. Please see the text description accompanying this episode.

Sam:
And we're back. Now. Let's dive in today's episode where we're unpacking some of the biggest breakthroughs that I mentioned earlier from the AI arms race to a game-changing medical discovery. This is one episode you're not going to want to miss. Let's get started.

Mike Collins:
Hey, and welcome to this week's three breakthroughs. I'm here again with Lucas. I'm Mike Collins, the founder and CEO of Alumni Ventures. We get together every week and talk about what's going on in tech and science and innovation and venture capital and whatever the hell else we want to talk about.

Speaker 1:
This seems to be my cue in this type of episode. Before we dive in deeper into the conversation, I'm going to set the stage a bit more for what's ahead because today's breakthroughs aren't just important. They're reshaping the future in real time. First up, we're talking about the AI arms race and things are escalating fast. Google, Microsoft and Amazon are investing billions into compute power. I'm going to explain what that means a little bit later, but building out massive AI supercomputers to fuel the next generation of models. But is this a necessary step forward? Or are we racing towards an AI monopoly where only the biggest players can compete? And what happens when AI advancement is limited by who can afford the most GPUs? We're going to break that down today.
And next, social media is evolving as users seek more tailored experiences. We're seeing a shift from all in one platforms to smaller, more specialized communities. So what does this mean for the future of online interaction and how will platforms adapt to this changing landscape? And then finally, we're going to shift from technology to medicine where one of the most promising breakthroughs in cancer research is only unfolding. A new cancer vaccine trial has delivered stunning results, with kidney cancer patients showing zero recurrence of the disease after three years. It's an incredible step forward in personalized immunotherapy. And if this approach scales, it could change how we treat cancer forever. The world is shifting, industries are evolving, and these breakthroughs are leading the charge. Stick with us. We're about to break it all down.

Mike Collins:
So the big splash a few weeks ago was DeepSeq and everybody freaking out. We talked a little bit about it, but we're now a couple weeks into it. And from the people writing big checks in the know, it seems to be a yawn and we are going to continue to spend enormous amounts of money on compute and data centers and energy. And if you listen to the earnings report, they all believe that they are compute constrained and not backing off at all. Whether that's Meta, whether that's Google, it just seems that they're plowing a hit. What's your take on it?

Lucas Pasch:
Yeah. I mean, not backing off is putting it lightly. Last week was Google's earnings announcement and they announced plans to increase CapEx to 75 billion in 2025. And that's off of 50-something I think in 2024. Analysts were expecting them to increase like 58 60, but they just blew that out of the water. So big tech is going all in writing checks so big, they may as well be government defense budgets. It's Amazon, Google, Microsoft Meta pouring tens of billions of dollars into AI infrastructure.

Speaker 1:
All right, let's take a second to talk about how massive $75 billion really is because when you throw around numbers that big, it's easy to lose perspective. So let's break it down. If you had $75 billion in a hundred dollars bills, the stack would reach about 50 miles high. That's nearly twice the height of the stratosphere. And if you spent $1 million every single day, it would take you over 205 years to run out of money. Now, let's put that into some real world comparisons.
Netflix, the streaming powerhouse, made about 39 billion in total revenue last year. So $75 billion is nearly double of Netflix's entire business. It's also 40% of the entire global gaming industry. Or how about this? When the US sent astronauts to the moon, the entire Apollo program cost around $25 billion in the 1960s adjusted for today's dollars. That's about $150 billion, meaning $75 billion is half the cost of putting humans on the moon multiple times. And for one more example to round this off, in the world of tech companies like Meta spent $33 billion last year on AI infrastructure, meaning that 75 billion could more than double Meta's AI investment. OpenAI's next big model GPT-V is rumored to cost between one and $10 billion to develop. So $75 billion could fund multiple generations of the most advanced AI systems we've ever seen. Bottom line, $75 billion isn't just a big number. It's a game changing amount of money that could shift entire industries, fund moon missions or shape the future of AI for years to come.

Lucas Pasch:
And I think their big bet is even in the face of what DeepSeq brought to the market a couple weeks ago, they believe that dominance in compute today is just going to mean greater control in this sector in the future.

Mike Collins:
Yeah. And I'm in the camp too, that these people are not run by speculative go from the gut people. These are run by the smartest. They're seeing ROI. ROIC. So I tend to trust them that this is not just game theory, I've got to spend it because that guy's spending it. I believe they're looking at usage. I believe they're looking at their business model and what they can charge and they're basically saying, this is being used, this is being paid for, this is an investment that is going to pay back for our company and our shareholders.
I believe that is true. That this is not kind of mass hallucination and a bubble. I believe people are using this stuff every day and are going to be using it more and more and they're investing in where there is demand. I could be wrong, but I tend to fall on that end of the spectrum that these people are seeing things, seeing numbers, sharing it, and they literally are, we cannot make this stuff fast enough. And even our portfolio company just this week in the Middle East announced a big deal, billion and a half dollars for Grok.

Lucas Pasch:
Grok. Yeah.

Mike Collins:
And again, I think that this is not just the big tech investing here. I think you're going to increasingly see countries investing in this infrastructure. I think you're going to see small and medium-sized looking to control their own models, customize their own models, train their own models. I think all of the above. Yes, yes, yes. And we've talked about this too, which is there's going to be a lot of picks and shovels. There's going to be a lot of energy constraints, that there is going to be... I think the interesting debate is where's their venture money to be allocated? Where in the stack and where do you want to play? Do you want to play it close to the metal? You want to play way up the stack at the application layer?
I think those are all interesting debates, but I think big tech has spoken, which is we're not blinking. We need more compute. And obviously that's going to feed into Nvidia and the like for sure. But this whole oh, shock and recalibration, I'm not seeing it. And to plug another podcast, I think a really good discussion over on BG-II is, I'd encourage people that they wanted to dig into deep-seek and this analysis, I thought those guys, their analysis was phenomenal. Again, word I hear about viewership and numbers and stuff, we're trying to add value to mostly our customers and our portfolio company CEOs. Go check them out. Great discussion.

Lucas Pasch:
Great discussion. And I think in terms of the two-week fallout from DeepSeq, sure it's not going to cause big tech to spend any less, but what the BG-II guys were talking about I think was really fascinating, which is DeepSeq's rise as an open source AI powerhouse is something that the rest of the industry is reckoning with and is kind of rethinking. For years, OpenAI, Google, anthropic, they were able to justify their closed models by arguing AI is too powerful, too dangerous, too expensive to give away for free.

Mike Collins:
That genie's out of the bottle for sure. In fact, I think you raise a really good point, Lucas about Sam Altman in an interview just recently said, "Hey, we need to rethink that." So again, I encourage people to go see kind of, Sam's just did a fascinating blog on the three rules of AI where he talked about scaling laws and one-tenth of the cost, but also this opening of like, "Hey, I think there's a place for open source even within our framework of the world." I think you're absolutely right. I think scale is one dimension. How much money, how big, fast do we build compute? I think energy is the dimension, and I think there's a fascinating where's value going to accrue in this whole open source discussion? Fascinating.

Lucas Pasch:
Yeah, it's really interesting how Sam's tone has shifted in the last couple of weeks. It started with Gear Up for the lawsuits, distillation practices.

Mike Collins:
Yeah, they ripped me off.

Lucas Pasch:
And now he's acknowledged-

Mike Collins:
Ironic from the guy who scraped the internet.

Lucas Pasch:
Right. But he has acknowledged like, no, this was impressive. And there was real innovation here. I don't know if he's going to drop the lawsuits ultimately, we'll see what he does.

Mike Collins:
We'll see.

Lucas Pasch:
But he definitely indicated an understanding that the R one model from DeepSeq really did require some impressive innovation. And he also indicated a potential openness to implementing a more open plan, an open plan for open ai, which is I think initially when the company was founded, it was supposed to be a pretty open model and has been closed really to date.

Mike Collins:
And again, I think this discussion too about what does open really mean? A lot of people throw that around. It's black and white. And I think one of the things that I imagine happened is Zuck lost his because really positioned, Hey, we got Google over here and trying to finesse what they're doing with losing their search business. And you got kind of nonprofit, for-profit, closed system chat GPT over here, and we are going to be the open source guys with an asterisk, but we're really on the scale of what I'll call semi open source. Because if you were big enough in reading the fine prints, again, Facebook talking a big game, doing a lot of other stuff, a lot of things they're trying to protect. And then really the Renegade entrepreneur who in this case happened to be in China says, "No, we're going to be actually a little further down the scale of open source and rock the world." So again, from where I sit in the cheap seats, all good competition.
We're trying to vest around the elephant's footsteps here, but I think it's good. I think it's good for humanity. I think this illusion of, oh, we're going to keep the genie in the bottle and we're going to keep it in the United States. And there's only a few players that are going to play. Whether that's ultimately would've been the right thing to do or not, I think that that was never going to happen. Life finds a way, technology finds a way, innovation finds a way, capitalism finds a way. I think all that is true.

Speaker 2:
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Lucas Pasch:
Let's move on to something that we're calling the social media unbundling. So for a long time now, social media has been synonymous with a handful of giants in the arena. Meta, X, TikTok, Snap to some degree, but there are cracks that are forming
Consumer frustration with algorithmic feeds and privacy concerns. And the sheer dominance of Big Tech has been fueling this new wave of decentralized open source social networks. So keeping on the theme here of open source. And so what that means is unlike their predecessors, these newer platforms are built on open protocols like Activity Pub or AT Protocol, and it allows users to move between apps without being locked into a single company's ecosystem. So think about how email works, right? You have your Gmail account, but that doesn't stop you from emailing someone who uses Outlook or ProtonMail or a different client. The service you use is just a preference. It's not a restriction in any way. And we're starting to see social media move in that direction. And I think it's really exciting. We are early investors in Blue Sky, that is kind of the open protocol-

Mike Collins:
Version of that.

Lucas Pasch:
Version of X. And it allows the apps to kind of communicate with one another just like email providers do. So in the future, social media is not about choosing one platform, it's about choosing the actual experience that you prefer. And one of the reasons that I want to talk about this is there are a rising number of, just like Blue Sky has been a rising competitor to X, Mastodon was another rising competitor to X that was big last year. Blue Sky has amassed like 25 million users.

Mike Collins:
30 now I just heard. Yeah.

Lucas Pasch:
Incredible. And so we're starting to track something similar on the Instagram side. There's one called Pixel Fed that's gained us some traction on the activity part protocol, and it's something that we're looking at really closely here at Alumni Ventures.

Speaker 1:
So as Lucas prepped us earlier, social media is shifting and Blue Sky is at the center of it. In just four months, the platform has grown from 10 million users in September of last year to over 27 million by mid-January of this year, a remarkable 174% increase. So what is driving this rapid adoption? A major factor has been the 2024 US presidential election, which led to a significant number of users seeking alternate platforms. Blue Sky saw daily increases of over 500,000 users with some reports showing up to a million new signups per day in late November. But this isn't just about one election. It reflects a broader trend in how people are engaging online. Many users are exploring new platforms that align with their evolving preferences for social media. And studies indicate that Blue Sky has gained traction with certain political groups. While other platforms continue to maintain their own dedicated audiences.
Additionally, recent changes in leadership and platform policies across social media have influenced how users interact, contributing to Blue Sky's growing appeal. Its decentralized approach and user controlled experience have been major factors in attracting new members. Even political figures are recognizing its potential. Several elected officials, including US representatives and state leaders have joined the platform, reinforcing its role in digital communication. Blue Sky's growth highlights an ongoing shift in the social media ecosystem, where users are increasingly seeking platforms that reflect their communication preferences, content policies, and digital experiences. So what does this mean for the future of online interaction? And will this trend continue? What does that look like?

Mike Collins:
Again, I think this is really healthy for the ecosystem, right? When you have one dominant platform, competition is good. It leads to innovation, it leads to customer choice, it leads to options. And a lot of these social networks have such powerful network effects that you really have huge locket, right? And that makes for a really good business. But I think consumers benefit with choice. And as you know, we're big fans of Blue Sky and their approach and their tech stack. And this idea of related to everybody thinks, oh, Alumni Ventures was in early at Blue Sky. That must've been done by the woman's fund because a woman's CEO founder.
And it was not, it was actually done by our blockchain team and it's in several of our funds, but it really, we made the initial investment because we really just love this idea of decentralized tech stack, consumer choice, the ability to move. And yeah, we're just very excited about that as being a good option for people to put more control and more options in the hands of the user with their information, their preferences and their control. So it's good stuff, and I think we're going to be active with more companies that are innovating along that dimension as well. We're big believers.

Lucas Pasch:
Yeah, it'll be interesting to see what new business models come to prominence in this future. Big tech's dominance and social media has been fueled by advertising revenue. And they thrive because they control the user experience. They track every click, like, comment, and they can serve these hyper targeted ads in a more open, decentralized social web that control erodes completely. And so it'll be interesting to think about how these social platforms actually make money. Instead of squeezing revenue out of ads, we could see a move toward subscription based models, creator driven, monetization, community funded platforms. Mastodon is sustained by donations, Blue Sky is exploring more premium features. But at the end of the day, what's most-

Mike Collins:
If you have attention and you have eyeballs, I mean, again, coming back to the venture capital preference, the way I look at it is if you have attention and you have eyeballs, you can figure out a business model. And obviously we saw that with Google, we saw that with Facebook, that we live in an attention economy and good, smart people will figure out a fair way to build value in a good business model. But it all starts with get people to your thing for sure.

Lucas Pasch:
And make no mistake, this makes our jobs hard. We like investing in companies that have high switching costs and this reduces switching costs immensely. I'm annoyed as... But better competition is good. And as a consumer, I wake up to notifications that YouTube TV is going to increase my subscription and they're going to lose all of their paramount affiliated channels possibly. And it's really annoying. So the more that players in the ecosystem need to provide the better experience in order to keep users, I think is a good thing.

Mike Collins:
It's capitalism, right?

Speaker 1:
Imagine a world where cancer treatment, but instead uniquely tailored to each patient. That's why what NeoVax a personalized cancer vaccine is designed to do with the latest clinical trial results. They're nothing short of groundbreaking. Neovax is a custom-built vaccine that trains the body's own immune system to recognize and eliminate remaining cancer cells after surgery. How cool is that? Using neoantigens extracted from a patient's tumor? The vaccine creates a highly targeted immune response Reducing the chances of recurrence in advanced kidney cancer patients. And here's where it gets exciting. Every single patient in a recent phase one trial remains cancer-free nearly three years after receiving the vaccine. That's a hundred percent of participants with stage three or four kidney cancer, showing a strong and sustained immune response. The vaccine works incredibly fast.
T-cells responses spiked within three weeks, increasing by a staggering 166 fold and staying at high levels for up to three years. And while some patients experience minor side effects like injection site reactions and flu like symptoms, no severe adverse effects have been reported. But this is just the beginning though. Larger trials are already underway with researchers exploring how NeoVax could work alongside other immunotherapies to create even more powerful long-lasting treatments. A vaccine that fights cancer after it's removed trains the body to prevent its return and has zero recurrences in early trials. If these results hold, we could be looking at a game-changing future for kidney cancer treatment and beyond.

Mike Collins:
And the last thing on today, right? We in a day where we, I believe confirmed a new person to lead the department that oversees vaccines who has been accused fairly, unfairly of being a vaccine skeptic. I just want to spend a minute talking about a real promising new drug discovery in the area of vaccines for cancer. And so again, I go to the science and unequivocally, vaccines have done more for humanity than almost any technology of the last a hundred years. In lives saved, misery avoided, and just the data of good being done that the chart for vaccines is very, very strong. So huge fan of vaccines and exciting news out of just down the road at Dana Farber. Again, a very small trial, just a handful of people, but Neovax, which dealing with kidney cancer and the vaccine was administered after surgery and at medium follow-up, after three years, all patients remain cancer free, showing that the immune response kind of up all the random little kidney cancer cells kind of flowing around had yet to find a foothold, yet to find traction.
These patient's immune systems had been effective in gobbling this stuff up with relatively minor flu like symptoms that again, are the equivalent of you and I having a bad night out with airport sushi. So a really good trade-off there. Again, you and I have talked about, Lucas, at length, the real good work being done now in life sciences. We've talked extensively about the innovation with GLP-I drugs. And again, data coming out. There's just this week about helping with treating alcohol and fatty liver disease. And again, kind of the fourth thing on the topic list that we didn't get to, which is people using surgery to really effectively combat just advanced disease around liver problems. And so again, I just want to put a plug in for vaccines today and this real promising thing coming out of Dana Farber for kidney cancer.

Lucas Pasch:
Yeah. Mike, thank you for sending me the article. I read through the study summary from Dana Farber and I got goosebumps. This is a big moment. I have someone very close to me in my life who in the summer of 2023 was diagnosed with late stage kidney cancer. Thankfully the immunotherapy he's on has been very effective, but the prognosis initially was not good and the therapy took a toll. And the idea that in these patients, in this phase one study, the idea that at stage three and four, meaning there's been some degree of metastasis, all enough-

Mike Collins:
Three and four, is the horse has left the barn and it's very bad news, right?

Lucas Pasch:
All nine of these patients are cancer free still three years after treatment. I mean, this is a huge moment. Cancer vaccines have been talked about for years. They've been mostly theoretical or limited to only a couple types of cancers. And if these results hold up in larger trials, we could be witnessing the beginning of an entirely new category of-

Mike Collins:
Hope for later stage cancer patients. And again, I think under the sheets we're seeing the benefit of CRISPR. I think we're seeing the benefits of AI. I hear from a lot of cancer researchers that they're using these tools. Some of the tools coming out of Google with protein folding, all of this is creating a mesh of opportunity and optimism and hope for people. And again, just I think underscoring this specific example is just one of many and hopefully the beginning of much, much more. I go back to, we just lost President Carter at age of a hundred, but I think he was diagnosed with brain cancer. I forget the exact age, but it was a while ago. And people were just basically saying hospice, he's done. And because of immunotherapy, the ability to take one's own immune system, which is however religious you are, it is a beautiful system to keep us alive and keep us healthy.
And frankly, to fight cancer and fight other diseases and things. It is a wondrous system. And by tweaking it and attuning it and activating it, it is turning out to be the best cure, the best way to address something like the scourge of cancer. So I am just super excited about these cancer vaccines and other related things, whatever you want to call them. It may need a new branding, but just turbocharging our immune system to fight this problem. Everybody's all on board on that for sure. We don't have to get political or anything, but if you're stage three cancer, you're looking for answers. And if the answer is your own body, super exciting, super promising. Like you say, it gives us all goosebumps because we've all been touched by cancer in our families and lives. Well, Lucas, it's been great. I think your sprint tour of duty, you've done great. Couple of months we're onto another young buck. Drew Anzalek I think is going to be kind of the next on the baton and we'll sprinkle back to you.

Lucas Pasch:
You're not rid of me yet. I think we're going to go once more next week, Mike.

Mike Collins:
Excellent. I am preparing our millions of listeners and followers for the coming baton passing. So all right, we'll do it again next week, Lucas, and have a good night.

Lucas Pasch:
I'll make sure to bring it home with a good one next week. Thanks, Mike.

Mike Collins:
Bring it up. A lot of pressure.

Lucas Pasch:
All right,

Mike Collins:
See you buddy.

Speaker 3:
Thanks again for tuning into The Tech Optimist. If you enjoyed this episode, we'd really appreciate it if you'd give us a rating on whichever podcast app you're using and remember to subscribe to keep up with each episode. The Tech Optimist welcomes any questions, comments, or segment suggestions. So please email us at info@techoptimist.vc with any of those and be sure to visit our website at av.vc. As always, keep building.