Elon Musk has been on a roll.
SpaceX has been making progress at an exponential pace.
The aerospace giant has already launched 20 successful missions this year, and we’re less than six weeks into 2025. The company is averaging more than three launches to space every single week.
As of December, SpaceX Starlink has more than 4.6 million subscribers to its satellite-based broadband internet service, more than all of its competitors combined. Starlink’s constellation of satellites in Earth’s orbit represents a space-based World Wide Web, enabling communications anywhere in orbit and on the surface of Earth.
And just two days ago, Starlink enabled direct-to-cell services in collaboration with T-Mobile to and from Starlink satellites to normal smartphones. This technological feat enables anyone to have access to emergency services, even when they are outside of the coverage of land-based wireless networks.
Text messages can be sent and received to and from Starlink satellites, and later this year, picture messages, data, and even voice calls will be enabled.
At Tesla, the company is gearing up to launch its robotaxi network in Texas by June. Its full self-driving software, version 13.2, is nothing short of miraculous. I’ve had it drive me for hours without having to touch the steering wheel. It’s just phenomenal and transformational for the future of transportation.
If that weren’t enough, Tesla is gearing up to launch Gen 3 of Optimus – Tesla’s autonomous, general-purpose humanoid robot. This product will also transform businesses, healthcare facilities, and even the home. It’s a market far larger than that for Tesla’s electric vehicles.
And Musk and his team at xAI have already built the world’s most powerful AI supercomputer, Colossus, outside Memphis, Tennessee. Musk’s goal is nothing short of developing an unbiased, neutral artificial general intelligence (AGI). Grok version 3 is due to be released within the next two months and will be a major step towards achieving that vision.
And that’s not to mention the progress that Musk and his teams have been making at Neuralink and The Boring Company.
It’s hard to grok that all of the above can be attributed back to the leadership and vision of a single man.
Given the heavy lifting that Musk has been doing to solve some of the world’s greatest technological challenges, it’s remarkable to see the success that he and his team have been having elsewhere…
Specifically at the Department of Government Efficiency (DOGE).
In just three weeks, the DOGE team has uncovered hundreds of billions of fraud, waste, and corruption that has happened at the expense of the U.S. taxpayer.
Just yesterday, it was made public that roughly $50 billion of fraudulent payments were being made by the U.S. Treasury for entitlement payments.
The media hasn’t been kind to Musk. And now we know why.
One of the most jaw-dropping discoveries of the last two weeks has been that the U.S. government paid $472.6 million taxpayer dollars to Internews Network, a global media non-governmental organization (NGO), explicitly to promote censorship and media control.
Those funds flowed to 4,921 media organizations. They were paid to propagate and proliferate the desired political narrative. If they didn’t, they would lose the funding. And that’s why the media is not kind to Musk now. They are all losing their funding.
It all makes sense now, and we have the receipts to prove it, thanks to DOGE.
It has only been three weeks, and what we’ve learned has been unbelievable. Far worse than anything imagined. I’m excited to see what they do in the next seventeen months – the DOGE mandate expires on July 4, 2026 – on America’s 250th birthday.
If Musk is right, and I believe that he is, what we’re going to learn about the extent of fraud will be hard to comprehend.
With everything going on, it’s hard to believe that Musk has time for anything else.
And yet, just yesterday, Musk made yet another big move…
Musk offered $97.4 billion for control of Sam Altman-led OpenAI, the creator of ChatGPT, GPT o1, and the forthcoming GPT o3.
This is a fascinating development for several reasons.
As we learned in yesterday’s Bleeding Edge, OpenAI is raising an additional $40 billion at a $300 billion valuation. The lead investor for that round is Japan-based Softbank – one of the key players in the $500 billion Project Stargate.
That might give the impression that Musk’s offer is too low to be seriously considered. But we don’t yet know the details, only that the offer is for “control” of OpenAI.
That could suggest the offer is for 51% of OpenAI, implying a valuation of about $195 billion if true. That would be a healthy premium to the October 2024 round at $157 billion and a more than reasonable offer based on forecasted 2025 revenues.
And even if the offer is for the entire business, $97.4 billion represents an EV/Sales of 8.3 based on OpenAI’s forecasted 2025 revenues of $11.7 billion.
There’s definitely some logic, though, to Musk not wanting to buy out all of the equity holders. After all, there are some investors that he’d like to get rid of and some that he wouldn’t mind having around.
To be more specific, it’s not Musk making the offer. It’s Musk’s xAI – backed by some powerful investors, such as Valor Equity Partners, Atreides Management, Vy Capital, and 8VC.
Some of the media have mischaracterized the offer by xAI as an indication that xAI is “behind” in building its own frontier model. They are trying to position xAI as being “desperate” to catch up to OpenAI – even saying Musk is trying to “slow down” a competitor. This narrative is completely wrong.
Musk has been public about OpenAI’s CEO Sam Altman being untrustworthy. Altman has steered OpenAI away from its original mission of being a non-profit and has been working hard to change OpenAI’s status to a for-profit entity.
Altman is expected to get a 7% stake in the for-profit company, which would value his equity around $10 billion. I don’t blame Musk a bit for pointing out these inconvenient truths. Musk was a founder of OpenAI and left early on as he could see it was veering quickly from its non-profit mission.
And this gets to the “why” xAI has made an offer for control of OpenAI…
To understand the why, let’s look back at another bold takeover by Musk.
Elon Musk and his backers knowingly overpaid for Twitter because the platform was untrustworthy. It was being used to propagate lies, mistruths, and political narratives bought and paid for by the U.S. government, much like the other social media platforms, which at least half of Americans use to get their “news.”
(NOTE: This is no longer a contested point – Mark Zuckerberg has admitted multiple times to his company’s compliance with censorship mandates.)
The purpose of the Twitter acquisition was simple: to fight against authoritarian censorship and restore freedom of speech.
Not only have Musk and his team at X been successful in accomplishing that, but they’ve also turned the business around.
In 2024, X generated $1.25 billion in adjusted EBITDA on $2.7 billion in revenue. Better yet, the platform is thriving with more than 650 million monthly active users compared to just 370 million when Musk acquired Twitter.
xAI doesn’t want to acquire OpenAI for the technology. It wants to acquire control of OpenAI to avoid a far more nefarious outcome. After all, it is well-known that OpenAI’s AI has been programmed with bias and political narrative.
OpenAI’s ChatGPT (www.chatgpt.com) gets 4.79 billion visits a month. And this is a global phenomenon, as just 15% of those visits are from U.S.-based users.
As we explored with a bit of humor in yesterday’s Bleeding Edge – Le Big Mac? Non. Le Chat, when most of us think about a chatbot, we think about ChatGPT. That’s the value of being first to market – it’s like a default, and it has a global awareness scale that is hard to fathom.
Here’s the key point – artificial general intelligence will quickly become the operating system for society. It will be so easy to use, and it will remove so much friction in life, that everyone will adopt it blindly just as they adopt social media without really knowing or caring about their violations of privacy or how they might be being manipulated and “influenced.”
And if an operating system for society is programmed with bias, untruths, and political narratives, it will not be a better world. It will get much worse.
Musk, his team at xAI, and his investors want to acquire control of OpenAI to complete their mission: To develop and proliferate a “maximum truth-seeking AI.”
If the foundation of an AGI is based on facts and evidence – and not programmed by bias – we can avoid a world where a global population is being actively manipulated daily, which we have all experienced, and the eventual destruction of civilization as we know it.
Acquiring control of OpenAI and its user base would be an accelerated path towards achieving a neutral “operating system” designed for truth and the technological advancement of civilization.
And by the way, xAI doesn’t need to convince Sam Altman to do it. Musk just needs to convince the OpenAI board and the majority of the investors, including Microsoft, to accept a deal.
The reality is that any deal that the OpenAI board would accept would almost certainly make all prior investors in OpenAI extraordinary returns.
And as we learned from the effects of the nearly half a billion taxpayer dollars spent paying off media outlets through the Internews Network NGO – money talks.
Jeff
The Bleeding Edge is the only free newsletter that delivers daily insights and information from the high-tech world as well as topics and trends relevant to investments.
The Bleeding Edge is the only free newsletter that delivers daily insights and information from the high-tech world as well as topics and trends relevant to investments.
