27: Marc Andreessen

For the past 5 years, the AI industry has been built on one core assumption:

Building powerful AI requires massive resources.

Huge data centers. Thousands of engineers. Billions in funding.

That assumption just got shattered: pic.twitter.com/39IHQyyO85

— GC Cooke (@thegrahamcooke) January 27, 2025

A new AI model has matched their performance at a fraction of the cost.

Not just marginally cheaper.

We're talking about an order of magnitude reduction in what it takes to build world-class AI.

This isn't just disruption - it's an extinction event.

China knows this, that's… pic.twitter.com/rNLWKtKl2n

— GC Cooke (@thegrahamcooke) January 27, 2025

To understand why, we need to look back at the dot-com crash of 2000.

History doesn't repeat itself...it rhymes.

Companies spent hundreds of billions laying fiber optic cables under oceans. This is remarkably similar to what happened with GPU's in the 2000's.

They built enough… pic.twitter.com/IOB1HdKuwl

— GC Cooke (@thegrahamcooke) January 27, 2025

But they made a crucial miscalculation:

The infrastructure far outpaced actual demand.

Companies like Webvan built billion-dollar warehouses, assuming everyone would instantly start buying groceries online.

They were right about the trend, but catastrophically wrong about… pic.twitter.com/aKDgUrLNGE

— GC Cooke (@thegrahamcooke) January 27, 2025

When reality hit, it was brutal:

• Stock prices collapsed
• Companies went bankrupt
• Trillions in value vanished

Today's AI boom is following the exact same pattern, but the numbers are even more shocking: pic.twitter.com/rM6MOmN1L8

— GC Cooke (@thegrahamcooke) January 27, 2025

Sequoia predicts the AI industry needs $600 billion in revenue to justify current investments.

We're at just 10% of that today.

This isn't just a gap - it's a chasm between expectation and reality.

And now comes the catalyst that brings it all down: pic.twitter.com/17vav6lKsu

— GC Cooke (@thegrahamcooke) January 27, 2025

This breakthrough in efficient AI development proves something stunning:

Most of the massive infrastructure being built right now is unnecessary.

Think about the implications:

• Billions in data centers? Overkill
• Massive hardware investments? Wasteful
• Current AI… pic.twitter.com/BzcK5iGlvt

— GC Cooke (@thegrahamcooke) January 27, 2025

The entire economic model of the AI industry is built on scarcity:

"Only a few companies can afford to build powerful AI."

That scarcity just vanished.

And when artificial scarcity disappears, bubbles pop:

— GC Cooke (@thegrahamcooke) January 27, 2025

After the dot-com crash, something fascinating happened:

While the media declared the internet "dead," the real revolution began quietly.

Amazon wasn't building unnecessary infrastructure.

They were solving real problems for customers: pic.twitter.com/Xg6DpUh71c

— GC Cooke (@thegrahamcooke) January 27, 2025

The same transformation is coming to AI.

Web4 will emerge from the ashes, built on fundamentally different principles:

• Efficient, affordable AI models
• Decentralized infrastructure
• Natural human interfaces
• Value from data quality, not brute force compute

This…

— GC Cooke (@thegrahamcooke) January 27, 2025

The winners won't be who you expect.

Just like Amazon understood retail better than https://t.co/gCiMu5OZfR understood pets...

The next AI giants will be built by people who understand real human needs.

Three massive shifts are already beginning:

— GC Cooke (@thegrahamcooke) January 27, 2025

1. Edge Computing Over Cloud:
AI moves from massive data centers to local devices, bringing privacy and speed

2. Data Quality Over Size:
Better data beats bigger models

3. Practical Uses Over Demos:
Solving real problems beats impressive parlor tricks

The smart money sees this… pic.twitter.com/JFyyo60pTG

— GC Cooke (@thegrahamcooke) January 27, 2025

We're witnessing a pivotal moment in tech history.

The AI bubble will burst.

But just like the internet after 2000, what comes next will be far more revolutionary than anyone expects.

— GC Cooke (@thegrahamcooke) January 27, 2025

The Japanese have one of the world's highest life expectancies.

It's nothing to do with their genetics.

They've mastered ONE health secret that the West has never seen.

Here's the 2000-year-old tradition that's transforming thousands of lives: pic.twitter.com/i9vm56BGWZ

— Kulbir Sohi (@LivingAlpha1) January 27, 2025

What Is Deepseek And How Is It Upending The AI World?

DeepSeek is a Chinese artificial intelligence (AI) company that has recently garnered significant attention for its rapid advancements in AI technology. Founded in 2023 and backed by the High-Flyer hedge fund, DeepSeek focuses on developing open-source large language models (LLMs) and has committed to open-sourcing all of its models. (Wikipedia)

In January 2025, DeepSeek released its flagship AI model, R1, which has been compared to OpenAI's latest model, o1. R1 was developed in just two months at a cost of under $6 million, significantly less than the investments made by its Western counterparts. The model has demonstrated advanced reasoning capabilities and has become the top-rated free application on Apple's App Store in several countries, including the US, the UK, and China. (Business Insider)

DeepSeek's approach to AI development emphasizes cost-efficiency and accessibility. By making its models open-source, the company allows the global developer community to inspect, improve, and build upon its technology. This strategy challenges the prevailing notion that developing advanced AI models requires substantial financial and computational resources. (Yahoo Finance)

The emergence of DeepSeek has had immediate effects on the global tech industry. Shares of major US AI-related companies, including Nvidia, Meta, and Microsoft, experienced significant declines in response to DeepSeek's success. Analysts have warned that the rise of low-cost Chinese alternatives to established US AI models could disrupt the investment landscape, forcing companies to reconsider their AI strategies. (The Economic Times)

However, DeepSeek's models have faced criticism for embedded censorship to comply with Chinese regulations, particularly concerning politically sensitive topics. This has raised concerns about data privacy and the potential for disinformation. (Wikipedia)

In summary, DeepSeek's rapid development and deployment of cost-effective, open-source AI models are challenging existing paradigms in the AI industry, prompting both excitement and concern within the global tech community. 

What Is DeepSeek? Everything to Know About China’s ChatGPT Rival and Why It Might Mean the End of the AI Trade.
Nightmare on Wall Street as tech stocks set to lose $1T over Chinese AI startup DeepSeek
Chinese AI chatbot DeepSeek sparks market turmoil

DeepSeek R1 just broke the Internet, and people are going crazy over it.

SPOILER: ChatGPT is now falling behind.

13 WILD examples so far (Don't miss the 5th one): pic.twitter.com/449klVA32A

— Poonam Soni (@CodeByPoonam) January 27, 2025

Your father named you after this character. That is how.

— Paramendra Kumar Bhagat (@paramendra) January 27, 2025

1. Creates bouncing yellow ball within a Rhombicosidodecahedronpic.twitter.com/K3zaj7yabZ

— Poonam Soni (@CodeByPoonam) January 27, 2025

2. Deepseek is #1 free app on the iOS app store. https://t.co/fk2zKkbOvs

— Poonam Soni (@CodeByPoonam) January 27, 2025

6. Effect of DeepSeek R1? @sama pic.twitter.com/tPMS4dhw6V

— Poonam Soni (@CodeByPoonam) January 27, 2025

7. Nailed the hard math questionpic.twitter.com/QZf7rYM2IT

— Poonam Soni (@CodeByPoonam) January 27, 2025

9. DeepSeek is a side project 🤯 pic.twitter.com/k2eVaUm9nK

— Poonam Soni (@CodeByPoonam) January 27, 2025

11. Nasdaq 100 futures are now down -330 POINTS since the market opened just hours ago as DeepSeek takes #1 on the App Store. https://t.co/1GVlRH3Wvr

— Poonam Soni (@CodeByPoonam) January 27, 2025

12. Deepseek R1 seamlessly work with code in Cursorpic.twitter.com/JWyClEs985

— Poonam Soni (@CodeByPoonam) January 27, 2025

13. Building Perplexity clone in an hour without writing single line of codepic.twitter.com/SuSouF8H3l

— Poonam Soni (@CodeByPoonam) January 27, 2025

Website & API are live now!

Try DeepThink here: https://t.co/n4ATEXcYGC https://t.co/kkpEtg5kHl

— Poonam Soni (@CodeByPoonam) January 27, 2025

Sadly, they seem to have responded in the only way they could have scuttled the competition --even if for a while:

CHINESE AI DEEPSEEK HIT BY
LARGE-SCALE CYBERATTACK

Chinese AI sensation DeepSeek on Monday said it was limiting the registration of new users due to large-scale…

— Kamran Rehmat (@kaamyabi) January 27, 2025

https://t.co/NsL1Hd6zyK

— Eddie (@IamwhoIam003) January 27, 2025

https://t.co/O1imWWO2CH

— Paramendra Kumar Bhagat (@paramendra) January 27, 2025

New name for the water that separates England and France pic.twitter.com/R6Lipj1Dra

— Elon Musk (@elonmusk) January 26, 2025

Seriously, a single Chinese company and AI model DeepSeek brings down the whole Wall Street and AI sector in US. The world is changing in such an unexpected way. https://t.co/3GPLDprEad

— Ambassador Chen Song (@PRCAmbNepal) January 27, 2025

Peter Thiel is a kingmaker in the shadows

He backed Trump in 2016 and now 7 of his ex-colleagues(JD Vance, David Sacks, Elon, Vivek) are running the US government

Once you understand how Thiel spots winners before anyone else, you'll build influential networks like no other🧵 pic.twitter.com/DUvF3k3I3h

— Jonathan Swanson (@swaaanson) January 27, 2025

Peter Thiel today is at the center of all talent in Trump's cabinet.

He has quietly built a Peter Thiel Cinematic Universe.

The kind of power that could transform the US government and Silicon Valley.

But how did Peter Thiel orchestrate this? pic.twitter.com/UVEbZN4UXG

— Jonathan Swanson (@swaaanson) January 27, 2025

Thiel values substance over status.

Status and prestige are zero-sum games.
In a world where real value can be created, substance and true knowers are the people to look for.

To assess winners before anyone else, he came up with 4 questions... pic.twitter.com/PBExFm2mSc

— Jonathan Swanson (@swaaanson) January 27, 2025

All of the greats have bet their company on a contrarian belief:

Jobs and Gates: Computers will sit on desks, not warehouses.
Elon: Self-driving and Electric is the future.
Jensen: GPUs are the future, not CPUs. pic.twitter.com/rV7syrO4Wn

— Jonathan Swanson (@swaaanson) January 27, 2025

Peter's decision to hire David Sacks at PayPal is the perfect example of this.

Sacks walked into his interview, called their core product dumb, and walked out with a job. pic.twitter.com/MAC4XDsB6s

— Jonathan Swanson (@swaaanson) January 27, 2025

4. Do they have Zen-like opposites?

Exceptional people are living contradictions with a combination of unusual traits.

- Stubborn and open-minded
- Idiosyncratic yet work well in teams

Thiel calls this "The Founders Paradox" and I think it's his best idea. pic.twitter.com/3OS9c3275M

— Jonathan Swanson (@swaaanson) January 27, 2025

Thiel's ability to identify exceptional people by focusing on the right things helps him build extraordinary teams.

He creates the conditions that enable them to do their life's work.

And Peter does so by using a very peculiar system: pic.twitter.com/uP061BjITz

— Jonathan Swanson (@swaaanson) January 27, 2025

Most entrepreneurs can only aspire to be as good as Peter at recruiting and enforcing focus.

This stops them from operating at a high level of leverage.

While most founders operate at Level 2 or 3, Peter comfortably rests at 5. (maybe higher) pic.twitter.com/nmSs8Po0PA

— Jonathan Swanson (@swaaanson) January 27, 2025