The reasoning era begins 💬

It’s Friday!

Thoughtly co-founder Casey Mackrell briefly went viral for coding at his wedding, but the reality was less dramatic—he spent just 30 seconds on his laptop to push a crucial update, sparking debate on founder work-life balance.

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This week’s top updates…

👋 The DOJ is considering a potential breakup of Google after a landmark ruling found the company abused its search monopoly, marking one of the biggest antitrust actions in decades.

🎧 ByteDance launched $170 AI-powered Ola Friend earbuds in China, enabling direct interaction with its Doubao chatbot without a smartphone.

📁 Crypto market maker Cumberland vowed to continue business as usual after an SEC complaint accusing it of operating as an unregistered dealer, marking another escalation in the agency's crackdown on the blockchain industry.

🤝 LinkedIn's Services Marketplace has reached 10 million freelancers, growing 48% in the past year, as it taps into the evolving world of work despite freelancer platforms facing challenges.

💸 Monzo hit a $5.9 billion valuation after a secondary market share sale, providing liquidity for employees while continuing its growth trajectory and investor demand.

💬 Apple’s new AI feature in iOS 18.1 surprised a user by summarizing his breakup texts with a cold, machine-like "No longer in a relationship; wants belongings from the apartment," highlighting the need for better emotional intelligence in tech-driven summaries:

AI’s next leap: From fast responses to deep reasoning

Two years into the generative AI revolution, we’re moving beyond rapid-fire responses to something much more powerful: AI that can actually stop and think. This shift, dubbed “System 2” thinking, is set to unlock a new wave of applications with reasoning capabilities that mimic human problem-solving.

What’s changed?

The AI market’s foundation is stabilizing around key players like Microsoft/OpenAI, AWS/Anthropic, and Google. But the real action now is in AI’s ability to reason in real-time, opening doors for new, smarter applications.

Why it matters: The next-gen AI tools aren’t just about spitting out pre-trained responses—they’re thinking on the fly. This evolution means AI will soon be able to handle tasks that require deep problem-solving, like coding, research, and beyond.

The AlphaGo parallel: Remember when AlphaGo beat a Go champion by thinking ahead? Today’s AI models, like OpenAI’s “Strawberry,” are starting to do the same in fields like programming and science—solving problems through inference rather than pattern-matching.

For startups and investors: For founders, the opportunity lies not in competing with the tech giants at the infrastructure or model layer, but in building domain-specific applications. These agentic apps will target service markets, offering work as a service, a shift from the traditional software-as-a-service (SaaS) model. For investors, the application layer is where the real value lies, with significant potential for returns as AI moves into industries previously untouched by automation.

What’s next?

As AI’s reasoning capabilities grow, we’re likely to see multi-agent systems taking on even more complex tasks, pushing the boundaries of what machines can do. It’s no longer just about fast answers; it’s about smarter, more thoughtful AI solutions.

Tesla unveils Cybercab, Musk’s long-awaited robotaxi

Elon Musk has revealed the highly anticipated Cybercab, a futuristic autonomous vehicle designed without a steering wheel or pedals. Unveiled at Tesla's “We, Robot” event in California, the Cybercab is set to become a key player in Tesla's shift from electric vehicles (EVs) to AI-driven robotics and automation.

Key details about the Cybercab:

• Design: The vehicle features butterfly-wing doors, a small two-passenger cabin, and charges wirelessly through inductive power.

• Autonomy: Musk claims it will be 10–20 times safer than human-driven vehicles, with an operating cost as low as 20 cents per mile.

• Timeline: Production is expected by 2026, though possibly as late as 2027.

Musk is positioning the Cybercab as a game-changer in the transportation industry, aimed at reducing traffic accidents and revolutionizing how we commute. However, the vehicle still requires regulatory approval, and Tesla will need to overcome significant challenges in autonomous driving, especially with increasing scrutiny from safety regulators.

Tesla lags behind competitors like Waymo and Cruise, but Musk remains confident that the Cybercab will deliver on its promise to reshape urban mobility. Time will tell if Tesla can navigate the technical and regulatory hurdles ahead and fulfill Musk's vision for the future of autonomous transport.

FOUNDER NOTES

Today’s top founder & startup reads.

Read: How to secure celebrity investors for your startup (Nathan Beckord)

Watch: Calling my best friend with good news (Mack Hubbell)

Listen: We predict the future of YouTube (The Colin and Samir Show)