The a16z Show

Gavin Baker × David George

Gavin Baker argues AI does not resemble 2000: NVIDIA trades near 40 times trailing earnings versus Cisco’s 150–180 times, GPUs are fully utilized, and major buyers’ ROIC has risen roughly 10 points.The open risk is whether returns persist through Blackwell spending, while Google’s TPU competition, incumbent distribution, and outcome-based pricing could reshape infrastructure, SaaS margins, and AI monetization.

Dylan Patel × Erin Price-Wright × Guido Appenzeller × Erik Torenberg

GPT-5’s router is an economic release, directing simple queries to mini models while reserving “ungodly amounts of compute” for transactions OpenAI could monetize through agentic commerce.Flat-rate subscriptions face heavy-user losses, while custom silicon threatens Nvidia mainly if demand stays concentrated among hyperscalers; powered sites, grid equipment, and Intel’s capital needs remain near-term constraints on broader deployment.

Steph Smith × Martin Casado × Steven Sinofsky

DeepSeek R1’s permissive MIT-like license and released reasoning traces enable broad adoption and distillation into smaller models, shifting strategic advantage toward distribution and “AGI in your pocket.”Model value may migrate from benchmark leadership to stateful workflows as competitors catch up, while scale-out expands endpoints without eliminating hyperscale compute.The clearest policy signal is that chip and open-source restrictions did not prevent capable Chinese research, making faster domestic innovation and permissionless diffusion the unresolved US advantage.