Capitalizing on AI's Defense Pivot, Infrastructure Wars, and Platform Power Grabs.
AI Market Report, May 2025.
May 2025 opens with a market that finally understands the price of speed: compute costs that can strangle a balance sheet overnight, regulatory cross-hairs aimed at any model that can pass a bar exam, and a geopolitical knife-fight over who owns the surveillance stack. The era of easy AI wins is officially over.
We also come with this month’s receipts. Over the last twelve months, we flagged three signals as likely to manifest around this time:
Google’s internal strife and palpable employee dissatisfaction.
The stealthy diffusion model coup – a call we made most recently in our April report, when many were still sleeping on the imminent arrival of text diffusion into the mainstream. Just ten days before Google's major announcement of their own diffusion LLM.
The early chatter of Blackwell-class GPUs preparing to corner data-center economics.
All three landed on schedule. The impact of Google's talent exodus, for instance, is now starkly visible: The following chart shows how Google (not including Deepmind) is the most likely to lose talent to upcoming AI Labs. The picture is even worse for Deepmind (Google’s main AI Lab)- with Engineers being 11 times more likely to leave Deepmind for Anthropic than the reverse.
This continued prediction success isn’t blind luck. Every month, our team reads thousands of pages in papers, financial reports, engineering blogs, and more.
We review code, commits in OSS libraries, and failure patterns across hundreds of engineering teams. Spent many hours in discussions with various members, both internally in our team and externally in high-performing Investment Teams, Labs, and Startups. To bring you the concrete, actionable insights before anyone else.
This month’s market report is focused on two types of insights:
Capital Map – Where the next tranche of serious money will compound: defense-aligned AI, compute monopolies, heavy-edge deployments, and the platforms rewriting ad economics under your nose.
Career Vector: The tactical skill stacks and domain expertise that convert macro shifts into personal leverage. We identify the specific capabilities commanding 40 %+ premiums over commodity talent.
If you’re looking for asymmetric advantage in either dimension, then this report contains concrete, falsifiable, and time-stamped moves for you.
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