Elon’s Anthropic Deal, The Next AI Monopoly?, “FDA for AI” Panic, Trading the AI Boom

May 8, 2026 1h 22m

All-In Podcast

Key Takeaway

Elon Musk just became a hyperscaler overnight by leasing all of Colossus 1 to Anthropic—over 220,000 Nvidia GPUs solving their compute constraints while generating an estimated $5 billion in new revenue for SpaceX. This deal validates a critical insight: the AI race isn't constrained by demand but by power and compute supply. Companies that secured infrastructure early (like Elon building data centers at scale) now hold kingmaker positions in determining which AI labs can deliver on their exponential growth trajectories.

Episode Overview

The hosts discuss Elon Musk's strategic move leasing SpaceX's Colossus data center to Anthropic, effectively creating "Elon Web Services" (EWS) as a new hyperscaler competitor. The conversation explores how this deal solves Anthropic's compute constraints while de-risking SpaceX's valuation story, debates whether Anthropic is on track to become an unprecedented monopoly, and examines the broader implications for AI competition and American innovation leadership.

Key Insights

AI Revenue Is Supply-Constrained, Not Demand-Constrained

Anthropic and OpenAI's revenue performance has nothing to do with lack of demand—it's entirely driven by supply constraints in data centers and power. With infinite power, their revenues would be even more parabolic. This means all analysis about exceeding or underperforming forecasts misses the point: the bottleneck is infrastructure, not market appetite.

Elon's Infrastructure Bet Creates Strategic Optionality

By building massive compute infrastructure early, Elon created a five-layer value stack: launch services, connectivity (Starlink), compute/hyperscaler services, space data centers, and AI applications/models. Leasing Colossus 1 generates immediate revenue ($5B estimated) that subsidizes xAI development while eliminating the balance sheet risk of unpaid CapEx commitments before having frontier-competitive models.

The Coding Market Represents a Trillion-Dollar Immediate TAM

The total addressable market just for coding—software developers and creation of software—is approximately $1 trillion annually. With AI coding tokens potentially 10x-100x'ing the productivity and value in this market, we could see the software development market double to $2 trillion, providing massive near-term revenue opportunities for whoever wins the coding AI race.

Anthropic's Unprecedented Growth Trajectory

Anthropic grew from $10B ARR to $30B ARR (tripling) from January 1 to March 31, 2025, then accelerated from $30B to $44B in April alone—a rate of growth at scale never seen before in Silicon Valley. If this 10x annual growth continues for 18 more months, they could exit 2027 at $1 trillion ARR, potentially making them more valuable than the rest of the Mag 7 combined.

Big Tech Has Stopped Innovating

The market is sending a clear message by giving Elon companies a valuation premium while keeping Apple, Google, and Meta at standard multiples: society expected broader benefits from innovation but instead got incrementalism—better ad targeting that does nothing (or worse) for society. The valuation differential reflects punishment for companies that have stopped taking meaningful innovation swings.

Notable Quotes

"Anthropic and OpenAI's revenue performance has nothing to do with demand. Zero. It is entirely to do with the supply constraints that exist in data centers and specifically in power. If they had infinite power, I think that their revenues would probably be even more parabolic."

— Chamath Palihapitiya

"The chaos that is American capitalism somehow finds a way, okay? And there's tremendous demand for Anthropic, and we find a way."

— Brad Gerstner

"Nobody in Silicon Valley has ever seen anything like it. Forget about the rest of the country. I mean, all we do in Silicon Valley is deal with exponentials, and still people have never seen that kind of growth at that level of scale."

— David Sacks

"You guys have stopped innovating. There's a lot of incrementalism, and we as a society aren't benefiting broadly the way that you told us we would be. And so, maybe this is the best way for them to get this message, which is to whack their valuation."

— Chamath Palihapitiya

"Unless something about their current trajectory changes, Anthropic will be the most powerful monopoly ever created in human history."

— David Sacks

Action Items

1
Monitor Your Company's Innovation Pipeline
Evaluate whether your organization is pursuing genuine innovation or just incrementalism. The market is rewarding companies with clear future pipelines (like Elon's ventures) with premium valuations while punishing those focused on marginal improvements. Ask: what are we building that will create new value for society, not just extract more from existing markets?
2
Secure Critical Infrastructure Early
In any rapidly growing market, identify the constraining resource (in AI it's compute/power) and secure it before it becomes obvious to everyone. Elon saw the compute shortage coming and built infrastructure at scale early, creating optionality to either use it directly or monetize it. Apply this principle to your domain: what will be scarce in 2-3 years that you can lock in now?
3
Focus on Revenue-Generating Applications
The AI market has consolidated around coding as the primary revenue driver (enterprise use case). If you're building in AI, stop spreading efforts across multiple experimental use cases (image generation, chatbots, etc.) and double down on where actual revenue is being generated today. The porcupine strategy (one clear focus) is beating the fox strategy (many scattered bets).
4
Build Platforms That Create Win-Win Ecosystem Value
Elon's deal with Anthropic shows how to create a strategic win-win: Anthropic gets compute they desperately need, xAI gets revenue to subsidize development without balance sheet risk. Look for opportunities where your excess capacity or infrastructure can solve others' critical constraints while generating revenue for you.