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This week in Silicon Valley, startups & tech:
Pope Leo XIV dropped 43,000 words on AI: Anthropic co-founder Christopher Olah attended the unveiling.
DC committed $11B+ to AI in one week: $2B in equity stakes in quantum companies, $9B in chips for spy agencies, and a quietly killed AI EO.
5,500+ GitHub repos hit in one supply-chain attack: TeamPCP executed 20 attack "waves" compromising 500+ pieces of software.
Manus is raising $1B+ to buy itself back from Meta: Beijing forced the unwind of Meta's $2B acquisition
The IPO cascade is real: OpenAI is preparing to file confidentially as soon as May 22; Oura and Blockchain.com filed confidentially this week.
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-🕊️ The Pope Drops 43K Words on AI
Pope Leo XIV just made the Vatican the loudest moral voice in AI, releasing his first encyclical after weeks of quiet lobbying from Silicon Valley. Magnifica humanitas calls for AI regulation, attacks "new forms of slavery" in tech supply chains, and lands with Anthropic's fingerprints all over it.
🪶 Magnifica humanitas, 43K Words on AI
Pope Leo XIV's encyclical is the first papal teaching focused on AI. It calls for AI regulation and child protection from hypersexualized AI imagery, and urges governments to slow down AI development, decrying "new forms of slavery" in AI and tech supply chains.
🤝 Anthropic's Vatican Play
Anthropic co-founder Christopher Olah attended the unveiling, with WaPo reporting a section on AI's unpredictability suggests Anthropic influence. Religion News Service documented Anthropic's months of ongoing ethics discussions with the Vatican that led to the invitation. The same company is finalizing a classified NSA contract this same week. Anthropic is briefing the Pope and the spy agencies in the same news cycle.
🛐 Silicon Valley's Quiet Vatican Lobby
Meta, Google, and Amazon execs met Vatican officials on April 29 as part of a quiet lobbying push ahead of the encyclical's release, per Politico. Tech is now lobbying not just governments but moral authorities, with the same urgency it brings to capitols.
Translation: When the Vatican is louder on AI safety than Congress, the lobbying map gets redrawn. Where do you take your AI ethics meetings now, Rome or DC?
🏛️ Washington's $11B AI Week
Trump killed his own AI executive order this week after a last-minute lobbying push from Sacks, Musk, and Zuckerberg. In the same seven days, Washington committed more than $11B to AI on three other fronts: equity stakes in quantum companies, classified chips for the spy agencies, and a Pentagon task force to weaponize hacking models. Less regulation, more procurement.
🪦 The AI EO That Didn't Happen
The White House postponed Trump's AI executive order signing ceremony, with the President saying he "didn't like certain aspects of it." Sources told the Washington Post Trump shelved the order after calls with Musk and Zuckerberg; Politico reports David Sacks made the case that federal AI reviews would slow innovation and hurt the US in the race against China. The draft EO emphasized that government AI reviews would be voluntary; Treasury's expanded role was flagged as a final-hour concern. Axios's take: Trump "just hates regulation".
💎 $2B + Equity Stakes for Quantum
The Commerce Department announced $2B in grants to nine quantum computing companies and the government is taking equity stakes; IBM gets $1B of the package. Markets reacted instantly:
D-Wave: closed up 33%
Rigetti: closed up 30%
IBM: closed up 12%
France matched the bet hours later with Macron announcing €1B for quantum research and €550M for semiconductors. Industrial policy with sovereign-fund mechanics is the new shape of state AI strategy.
🛰️ The Classified Procurement Boom
The White House approved a $9B request to buy advanced AI chips for the spy agencies per NYT sources, while Anthropic is finalizing a classified contract to keep the NSA on Claude. The Pentagon launched a task force to study how to safely deploy AI tools with hacking capabilities across Cyber Command and NSA missions. The ECB summoned Eurozone banks to discuss AI risks. London Mayor Sadiq Khan blocked the Met police's £50M Palantir deal as the one major counter-example.
Translation: Federal AI policy this week was the opposite of what it looked like. The rules died; the checks cleared. Are governments writing AI policy or buying AI capability, and does the distinction matter once the procurement closes?
🛡️ Megalodon Week: AI vs AI on the Supply Chain
The largest software supply-chain attack of the year unfolded over seven days. 5,500+ GitHub repos infected in one coordinated push, with the same TeamPCP crew tied to a separate 3,800-repo breach executing 20 more attack waves on hundreds of additional software packages. For the first time, both sides of cyber are running AI as the primary attacker and the primary defender.
🐙 The Megalodon Cascade
More than 5,500 GitHub repositories were infected with malware in the Megalodon supply-chain attack on May 18, which relied on automated commits. Earlier this week, GitHub linked a separate breach of 3,800 internal repositories to the TanStack npm supply-chain attack, executed via a malicious Nx Console VS Code extension. Wired reports TeamPCP, the gang behind the GitHub breach, also ran 20 "waves" of supply-chain attacks recently, compromising 500+ pieces of software.
🤖 The AI-Assisted Attacker
FOIA documents show the Russian hackers who breached SolarWinds had access to all "treasury.gov" emails from July 6 to October 12, 2020. US and Canadian authorities arrested 23-year-old Jacob Butler, the alleged operator of the Kimwolf DDoS botnet, which infected ~2M devices. The defensive side is hiring: security engineer postings are up 11% YoY in Q1 per NYT, driven by threats from AI-generated code and models like Mythos and GPT-5.4-Cyber.
🦾 The Defender's Counter-Stack
Anthropic's Project Glasswing has identified 10,000+ high- or critical-severity vulnerabilities using Claude Mythos Preview since launch. The flip side surfaced this week as well: the NTSB suspended its civil accident database after people used AI to re-create voices of pilots killed in a 2025 UPS crash. Even authoritative public datasets are now an attack surface.
Translation: Both sides of the security war now have AI doing the heavy lifting. The attacker generates new malware in seconds; the defender finds 10K critical vulns per quarter. Which side scales faster?
⚡ Funding & Investment Quick Hits
• Manus: in talks to raise $1B+ to buy itself back from Meta, after Beijing ordered the unwind of Meta's $2B acquisition
• DeepSeek: $10B round in progress, founders pitching AGI focus over short-term commercialization to potential investors
• Hark: $700M+ Series A at $6B for Brett Adcock's new AI hardware devices co; Parkway Venture led
• Modal Labs: $355M Series C at $4.65B (up from $1.1B in 2025); serverless cloud platform for AI apps and inference
• Exa: $250M at $2.2B (up from $700M in September) for a search engine built for AI agents; a16z led
• Mercury: $200M Series D at $5.2B (up from $3.5B in March 2025); TCV led; startup banking platform
• Farther Finance: $150M Series D at $1B+ post-money for AI wealth-management platform for advisors; General Atlantic led
• Fresha: $80M from KKR's growth equity arm at $1B+; London beauty and wellness booking platform; $285M total raised
• Moment: $78M Series C led by Index Ventures with a16z participating; AI tools for fixed-income and equities trading
• Commure: $70M at $7B post-money for healthcare AI revenue-cycle and workflow tools; General Catalyst led
• Socket: $60M at $1B from Thrive Capital for open-source supply-chain security tools (read more in DD3 above)
• Catena Labs: $30M Series A from Circle co-founder Sean Neville for AI-agent financial guardrails; applied for a US bank charter
💸 M&A & IPO Quick Hits
• OpenAI: preparing to file confidentially for an IPO as soon as May 22, with a target to go public as early as September (WSJ)
• Oura: filed confidentially for a US IPO set for later in 2026; SF- and Finland-based smart ring maker last valued at $11B in September 2025
• Blockchain.com: confidentially filed for a US IPO; UK-based crypto exchange founded in 2011, once valued at $14B
• Plenary Americas / ISC: La Caisse's infrastructure arm to acquire Canadian database company ISC for $872M; expected to close in Q3
• Uber / Delivery Hero: Uber confirmed a €38/share takeover offer valuing the group at €11.5B+; offer rebuffed, Uber weighing a higher bid
• Anthropic-Blackstone-H&F JV / Fractional AI: first deal of the unnamed enterprise services JV; sources: Fractional ended its OpenAI deal as part of the acquisition
• Tether / SoftBank-Twenty One: Tether bought out SoftBank's 26% stake ($679M) in bitcoin treasury firm Twenty One Capital, taking Tether to ~71%
• Activision shareholders / Microsoft: $250M settlement over allegations Microsoft and Activision underpaid them during the 2023 acquisition
🌟 Editor's Note
At Startup Intros, our mission is to bring the latest founder-investor news straight to your inbox, keeping you ahead in the fast-paced world of Silicon Valley.
💭 Parting Thoughts: The $65B Week
The thread connecting everything this week is institutional power finding its voice on AI:
The Pope released 43,000 words on AI ethics. Anthropic's Christopher Olah was there in person, the same week Anthropic finalized a classified NSA contract and got cited in WaPo as influencing the encyclical's language. Briefing the Vatican and the spy agencies in the same news cycle is a new posture for any company.
Washington committed $11B+ to AI: $2B for quantum equity stakes, $9B for spy-agency chips, $0 in new rules. Trump's AI executive order died after a single round of lobbying calls. France matched the quantum bet hours later.
5,500+ GitHub repos got infected in one coordinated attack. Anthropic's Glasswing turned up 10K+ critical vulns. Both sides of cyber now have AI doing the work.
Forward to a friend or hit reply to let me know what you're seeing in your world.
Till next time!
 | Dev Chandra |
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