While AI valuations keep stretching into the stratosphere, Andreessen Horowitz is making a contrarian bet. The firm has now committed over $3 billion to what it calls AI infrastructure, not consumer apps or hype-driven demos, but the tools developers and enterprises actually rely on.
To a16z, “infrastructure” means coding tools, models, security, and systems software—the plumbing behind AI. The logic is simple: if there is a bubble, the last things companies cut are the tools their engineers depend on.
Some early bets are already paying off. Cursor, an AI coding startup a16z backed early, jumped from a $400M valuation to nearly $30B in under a year. Other portfolio companies have been acquired by Stripe, Salesforce, Meta, and Cloudflare.
The fund is run by Martin Casado, a deeply technical operator who admits valuations are “crazy” but insists demand is real: users, GPUs, and revenue are all there. a16z is avoiding massive data-center plays and instead writing smaller, earlier checks, aiming to be in before the hype peaks.
OpenAI plans to test ads in ChatGPT for Free and Go users in the U.S. soon, positioning ads as a way to expand access without pushing everyone into paid plans.
Ads will be clearly labeled, shown separately from answers, and placed at the bottom of responses when relevant. They won’t affect how ChatGPT answers questions, and conversations won’t be shared or sold to advertisers. Users can turn off personalization, and paid plans stay ad-free.
Notably, ChatGPT Go ($8/month) is now available everywhere ChatGPT runs, including the U.S., while Pro, Business, and Enterprise remain clean, ad-free experiences.
The bigger signal: AI products are settling into a familiar model—free with ads, paid for focus and trust. If you’re building with AI, this raises the bar on transparency, privacy, and separation between answers and monetization.
3. Musk wants $134B From OpenAI and Microsoft
Elon Musk is seeking up to $134 billion from OpenAI and Microsoft, arguing they benefited from his early involvement and funding and now owe him what he calls “wrongful gains.”
Musk claims he contributed about $38M, roughly 60% of OpenAI’s early seed funding, plus credibility, recruiting help, and scaling know-how when OpenAI launched in 2015. According to his court filing, that early support helped generate $65B–$109B in value for OpenAI and $13B–$25B for Microsoft
OpenAI has dismissed the claim as “unserious” and part of a harassment campaign. Microsoft has denied any wrongdoing. Both companies argue Musk’s damages math is speculative and misleading.
The lawsuit centers on Musk’s claim that OpenAI abandoned its original nonprofit mission when it restructured into a for-profit entity. A judge has ruled the case will go to a jury trial, expected in April.
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