Welcome to the Pirate Street Journal. The business press covers companies. We cover categories. Each week, we pick three headlines worth paying attention to and break down the category underneath. Read the news through a different lens.
Dear Friend, Subscriber, and Category Pirate,
Anthropic is paying SpaceX $1.25 billion a month for compute.
Every month through May of 2029.
Roughly $45 billion total.
That single contract is bigger than SpaceX’s entire annual revenue today.
Software is paying hardware. Hardware is paying energy. Energy is paying space.
Is it three card monte?
Or is the pie getting massively bigger?
This should be on every business news front page this week. Instead, the headlines are about Sam Altman’s house getting attacked, Eric Schmidt getting booed off a stage, and OpenAI quietly leaking that it might file for an IPO too.
Here’s what we covered in this episode:
1. AI gets an F in marketing.
360,000 Americans are in Facebook groups organized against data centers. AI is polling less popular than ICE, less popular than Trump, less popular than politicians.
The technology being protested is curing diseases and driving much of US GDP growth.
So why are so many angry at AI?
Pirate Eddie has a theory, and it does not involve AI at all.
Marriage rates. Birth rates. Teenage drinking. Labor force participation among young men.
All down.
Life stages and zest for life as we know was crumbling before AI.
2. SpaceX is going public. The TAM is the size of the American economy.
The S-1 is pitching a $28.5 trillion total addressable market.
U.S. GDP is $32 trillion. SpaceX is asking public markets to fund a business roughly the size of the entire American economy, run by a CEO whose vesting schedule requires interplanetary colonization.
Imagine being on the dock before the Nina, Pinta and Santa Maria set sail and you were offered a chance to invest in the new world.
What was the ROI on America?
What if you had a chance to invest in Space?
But the history of IPOs is that retail investors get hurt.
The history of Elon Musk is that betting against him is also expensive.
The Pirates how category designers think about an IPO this size without losing your mind or your savings.
3. The category queen vs. the category queen.
The fastest-growing company in the history of business is not OpenAI.
It is Anthropic.
Anthropic was founded by people who left OpenAI. They are now in talks at $900 billion. Higher valuation. Higher growth. First profitable quarter ever at $11 billion in revenue.
Andrej Karpathy, founding member of OpenAI and the man who coined vibe coding, just joined Anthropic. Ross Nordeen of xAI joined Anthropic earlier this month. The defectors are recruiting the defectors.
Category Design 101 says the queen takes 76% of the economics. Everyone else shares 13%. So which one is the queen?
Pirate Christopher has a frame on the video that recasts the entire question. He thinks this is not OpenAI versus Anthropic at all.
This is the (new) Pirate Street Journal.
Every Wednesday, we pick three headlines worth paying attention to and break down the category underneath.
Three Wednesdays a month, the video is free (for now). Once a month, we drop a written deep dive for paid subscribers, the kind of category analysis you cannot get anywhere else.
Two ways to climb aboard:
Monthly subscriber: $20/month. You’ve done dumber things with $20.
Founding subscriber: $375/year. For about a dollar a day, you get every mini-book we’ve ever written (300+), every audiobook (30+), digital copies of all seven of our Big Books, and unlimited access to The Pirate Eddie Bot and Pirate Christopher Bot, your 24/7 AI jamming partners for category building.
To never miss a deep dive, become a subscriber today.
What’s coming up on Pirate Street Journal
A few of the threads from this week’s episode are running headlong into a much bigger story, which is the IPO season that is about to define the next decade of public markets.
On June 10th, two days before SpaceX is estimated to start trading, we are publishing the next PSJ written deep dive. We will be working through how a category designer thinks about investing in an IPO of this scale, what the category math says about SpaceX, OpenAI, and Anthropic going public in the same window, and we don’t know what the headlines will do between now and then, so there will be more.
Piratey disclaimer: This is NOT financial advice. None of us have Series 63, Series 7, Series 6 7, CPAs, CFAs, IUDs, IEDs, and hopefully not IBS (this makes DUDE Wipes sad).
Stay tuned for next week’s episode!
Hey Ho, Let’s Go!
Arrrrrrr,
Category Pirates
P.S. - Founding subscribers get every mini-book we have ever written (300+), every audiobook (30+), digital copies of all seven Big Books, and unlimited access to The Pirate Eddie Bot and Pirate Christopher Bot, your 24/7 AI jamming partners for category building for about a dollar a day. You have done dumber things with a dollar a day.
