The PayPal Mafia—a tight-knit group of former PayPal executives—has not only shaped the modern tech world but has also strategically expanded into defense, AI, and government contracting. Leveraging their financial power, deep connections, and influence, they have co-invested in a network of companies that now dominate national security, military AI, and autonomous warfare. As some of them move into government advisory roles, questions are being raised about potential conflicts of interest and the alignment of government procurement with their private business interests.
The Rise of the PayPal Mafia in Defense and AI
After selling PayPal to eBay, key members—including Peter Thiel, Elon Musk, Reid Hoffman, Max Levchin, David Sacks, and Joe Lonsdale—moved on to found and invest in companies at the intersection of AI, defense, cybersecurity, and robotics.
Key Companies They Founded and Funded
- Palantir (2003) – Co-founded by Peter Thiel and Joe Lonsdale, specializing in AI-driven data analytics for military, intelligence, and law enforcement agencies.
- Anduril (2017) – Co-founded by Palmer Luckey, with funding from Thiel’s Founders Fund and Trae Stephens, developing autonomous defense systems and AI-powered surveillance.
- Epirus (2018) – Co-founded by Joe Lonsdale and Nathan Mintz, focusing on electromagnetic warfare.
- CX2 (2024) – Founded by Nathan Mintz, backed by Andreessen Horowitz (a16z), specializing in electronic warfare and AI-driven spectrum dominance.
- SpaceX & Starlink (Musk, Thiel-backed) – Providing AI-driven satellite defense solutions, with increasing involvement in military applications.
- OpenAI (Thiel-backed) – Originally aimed at open AI research but has since moved into defense-related AI capabilities.
Their influence isn’t just financial—many of these companies now hold government contracts, military partnerships, and deep ties with intelligence agencies.
Expanding Influence into Government Contracts
The PayPal Mafia’s key players have not just funded these companies—they have also positioned themselves as advisors, policymakers, and influencers in national security.Creating potential conflicts of interest. With billions in Pentagon budgets directed toward AI, defense tech, and data-driven warfare, the financial incentives are undeniable.
Recent Key Appointments and Overlaps with Government
Elon Musk (PayPal co-founder, owner of SpaceX and Starlink) → His direct White House influence could steer military communications and AI-driven defense solutions toward SpaceX contracts.
Trae Stephens (Co-founder of Anduril, Partner at Thiel’s Founders Fund) → Appointed Deputy Secretary of Defense in Trump’s administration, overseeing military procurement.
David Sacks (Early PayPal exec, investor in Anduril and Palantir) → Named AI and Crypto Advisor, influencing policies that could benefit his investments.
These advisory and leadership roles allow them to shape military spending decisions, cr
Potential Conflicts of Interest: Aligning Business with Government Spending
Where Their Business and Government Roles Overlap
- Anduril (Trae Stephens) is already securing major U.S. military contracts, and with Stephens now in the Pentagon, there is potential for procurement decisions that could favor Anduril’s autonomous AI drones and surveillance tech.
- Palantir (Thiel, Lonsdale) has been deeply embedded in government contracts for years, benefiting from military data analytics contracts. With David Sacks influencing AI policy, Palantir could gain even more government work.
- SpaceX/Starlink (Musk, Thiel-backed) continues to expand military applications, and Musk’s direct influence on White House tech policy raises concerns about whether contracts are being steered toward his companies.
- CX2 (Mintz, backed by a16z) is a new entry in electronic warfare, backed by Silicon Valley’s elite, and could quickly become a top Pentagon contractor.
Financial and Ethical Questions Being Raised
- Are government officials now directing military budgets toward their own companies or those run by close friends?
- Do these advisors have the power to create procurement rules that benefit their businesses?
- Can an AI or defense policy be trusted if the people shaping it profit directly from its implementation?
Conclusion: A Tech-Oligarchic Influence Over U.S. Defense
The PayPal Mafia’s expansion into AI-driven defense, military tech, and government advisory roles has given them unprecedented control over how modern warfare evolves. Their cross-investments, board memberships, and direct influence on government spending create an ecosystem where they can steer billions in contracts toward their own ventures—blurring the line between private profit and public service.
As this network continues to blend government policy with private business interests, it raises serious ethical concerns about whether U.S. defense procurement is being influenced by personal financial incentives rather than national security needs.
This isn’t just about winning contracts—it’s about shaping the future of AI-driven warfare in a way that centralizes power in the hands of a small, interconnected group of tech elites.

- Deepseek has one of the very largest Nvidia clusters in Asia
- Deepseek and Chat GPT training date data is the same [June 2024]
- Deepseek performs and makes the same errors as ChatGPT 3/4
- The Hedge fund that owns Deepseek regularly shorts stocks
Deepseek Cluster is huge
DeepSeek’s cluster, reportedly around 50,000 NVIDIA GPUs, ranks as one of the largest GPU clusters in Asia. Here’s how it compares with other major GPU clusters in the region:
- DeepSeek Cluster (China)
- Size: Approximately 50,000 NVIDIA GPUs.
- Colossus Cluster (Asia, exact owner/location undisclosed):
- Size: Over 100,000 NVIDIA H100 GPUs, making it the largest GPU cluster globally.
- GreenNode Cluster (Thailand):
- Size: 1,024 NVIDIA H100 GPUs (smaller than DeepSeek’s cluster but significant for Southeast Asia).
- NSTDA Supercomputer (Thailand):
- Size: 704 NVIDIA A100 GPUs.
- China’s National Supercomputers:
- Tianhe-2A: Uses Matrix-2000 accelerators alongside CPUs, but the GPU count is less than 50,000.
Relative Position:
- DeepSeek’s cluster is one of the largest in Asia specifically for NVIDIA GPU-based AI applications.
- While it is smaller than Colossus, it outpaces most other clusters in the region in terms of GPU count and computing capacity.
- This positions DeepSeek among the leading AI hardware infrastructures in Asia, focused on cutting-edge AI development.
Same Training date cut-off of June 2024
I asked both “what is today’s news“
DeepSeek: As of my last update in July 2024, I don’t have real-time information. For today’s news, please check reliable news websites, apps, or platforms like BBC, CNN, Reuters, or others. If you want real-time info, please enable the Internet search feature at the bottom of the dialog box.
ChatGPT: My training data cutoff is June 2024. However, I can access and retrieve up-to-date information from the web when needed, ensuring my responses are current. If you’d like, I can help with the latest information!
Same Mistake as GPT 5 – The cup and ball Question
I asked – I put a small ball on a table and put a cup over it. I pick the cup up and then look inside it – what do I see
ChatGPT 4: When you lift the cup from the table where you placed the small ball and look inside, you should see the ball inside the cup, unless it has been moved or there’s some trick involved
Deepseek R1: IS WRONG ”When you pick up the cup and look inside, you will see the small ball that you originally placed on the table and covered with the cup. The ball should still be there, assuming:
- The cup was placed firmly over the ball, preventing it from rolling away.
- The cup was lifted straight up without tilting or shaking it, which could cause the ball to move or fall out.
If everything was done carefully, the ball will remain inside the cup when you lift it and look inside.”
Chat GPT 4o gets it right : If you place a cup over a ball on a table and then lift the cup to look inside it, the ball will no longer be inside the cup—it will still be sitting on the table where it was originally placed. The cup only “contains” the ball while it’s covering it, but once lifted, the ball stays put on the table.
Claude does even better and notably different as you would expect from a different algo and training data
Well, there are two possibilities:
- If the ball somehow stuck to or adhered to the inside of the cup when you lifted it, you would see the ball inside the cup.
- More likely, since most small balls don’t stick to cups, you would see just the empty inside of the cup, as the ball would have remained on the table when you lifted the cup.
Without knowing what kind of ball and cup we’re talking about and whether there are any special conditions involved, the second scenario seems most probable – you’d likely see an empty cup while the ball sits on the table where you originally placed it.
What actually happened when you tried this?
Disclaimer: This information is for educational purposes only. It does not constitute financial or investment advice. Always consult a qualified financial professional before making any investment decisions.
Tesla Rises more than 50% to $750 [Currently $430 Valuation $1.5tn]
Confidence Level HIGH – Commitment 20% portfolio
Why
- FSD excites mainstream media – people wake up to an iPhone moment and realise TSLA FSD is Real and will be as dominant in driving as Google in search
- Trump – Owes Elon big. Even if Musk upsets Trump, the fear that Musk would support a different candidate in the 2028 primaries
- Mergers e.g. Honda/Nissan shows mainstream media that legacy is un-investable.
- VW restructures or Merges
- One Major legacy Auto licenses Tesla FSD
- Tesla wins significant battery backup business from US government
- Optimus plays the piano!
- Did I mention lower cost car and refreshed model Y?
- TSLA component parts would justify current valuation many times over. EVs $500bn n 5 independent companies are
Click for Sum Of Parts Analysis
Here’s the updated table with the sum of Tesla’s segment valuations:
Tesla Business Segment | Description | Valuation Metric | Tesla Estimate | Peer Examples | Peer Valuation | Tesla Segment Valuation ($B) |
---|---|---|---|---|---|---|
Electric Vehicles (EV) | Core business of manufacturing EVs | P/S | ~6x Sales | BYD, Rivian, Lucid | BYD: ~3x, Rivian: ~5x, Lucid: ~10x | $515B |
Battery Business | Lithium mining to units | QS, Enovix | ? | |||
Energy Storage (Green Energy) | Powerwall and Megapack for energy storage solutions | P/S | ~10x Sales | Enphase Energy, NextEra Energy | Enphase: ~8x, NextEra: ~12x | $85B |
AI and Autonomy | Self-driving tech (Autopilot, FSD) | P/S | ~15x Sales | NVIDIA, Mobileye, Waymo | NVIDIA: ~20x, Mobileye: ~15x | $129B |
Software & Services | FSD subscriptions, Tesla app, over-the-air updates | P/E | ~80x Earnings | Palantir, Snowflake, Microsoft Azure | Palantir: ~75x, Snowflake: ~90x | $86B |
Solar Energy | Solar panels and solar roofs | P/S | ~12x Sales | Sunrun, SolarEdge | Sunrun: ~10x, SolarEdge: ~15x | $43B |
Final Valuation:
- Sum of all segments: $515B + $85B + $129B + $86B + $43B = $858B
Palantir $180 [PLTR: Currently $80]
Confidence Level HIGH – Commitment 15% portfolio
Click for Defining factors
- Massive existing contracts but only tiny penetration so far
- Amazon AWS partnership
- As PLTR becomes a more household name valuation will soar.
- Forward p/e of 80
- Q3 PEG of 1.9
- Charismatic leader
- Famous commercial clients – Tesla, BP, UK NHS, Airbus, Accenture +++
- Current valuation of $180bn is modest and imho given the trend in revenue growth could, at a stretch be valued on a par with Oracle ($500Bn)
- Forward p/e of 80
- Q3 PEG of 1.9
- Charismatic leader
- Famous commercial clients – Tesla, BP, UK NHS, Airbus, Accenture +++
- Current valuation of $180bn is modest and imho given the trend in reven
On The Radar
SoundHound
Serious Fortune 100 customers
more …
Some of SoundHound’s publicly known clients and partners include:
Automotive: Hyundai, Kia, Mercedes-Benz, Honda
Quick-Service Restaurants: White Castle (drive-thru AI pilot), and additional chains (not always publicly named)
Financial Services: Mastercard (voice-enabled payments exploration)
Media/Streaming: Pandora, Spotify
Tech & Consumer Electronics: Samsung, Snap (Snapchat music recognition)
Telecommunications & Others: Deutsche Telekom, VIZIO (voice-enabled devices)
These organizations integrate SoundHound’s Houndify platform to add voice AI capabilities to their products and services, from in-car infotainment and drive-thru ordering to music discovery and voice-activated payments.
ISRG – Intuitive Surgical
Strong established and well regarded medical with good exposure to AI medical applications
Click for Pro’s and cons
Below is a general assessment of Intuitive Surgical (ISRG) as an investment, considering both potential advantages (“good”) and risks or drawbacks (“bad”). This is not financial advice; always conduct your own research or consult a qualified advisor.
The “Good” (Bull Case)
- Market Leadership
- Intuitive Surgical’s da Vinci surgical systems are the market leader in robotic-assisted surgery.
- A strong installed base of surgical robots creates ongoing revenue from instruments, accessories, and maintenance (a “razor-and-blade” model).
- High Barriers to Entry
- Robotics and surgical systems face significant regulatory, R&D, and capital requirements.
- Intuitive Surgical’s intellectual property and brand recognition deter new competitors.
- Recurring Revenue & Growth Potential
- Once a hospital invests in a da Vinci system, recurring revenue streams come from each procedure: usage fees, disposable instruments, and service contracts.
- Growth tailwinds include expanding surgical indications (more procedure types) and increased global adoption, particularly in Asia.
- Strong Financials
- Historically robust balance sheet, minimal debt, and consistent profitability.
- High gross margins on instruments and accessories.
- Innovation & Pipeline
- Continued R&D into next-generation systems and new procedure categories (e.g., general surgery, thoracic, cardiac, etc.).
- Potential future expansion into other surgical specialties.
The “Bad”
- Valuation Concerns
- ISRG often trades at a premium (high P/E ratio) relative to the broader market and medical-device peers.
- If growth slows, that premium could compress, leading to a price drop.
- Competition
- Other robotic surgery systems from companies like Medtronic and Johnson & Johnson are emerging.
- New entrants or competing technologies (e.g., Vicarious Surgical) could erode Intuitive’s market share over time.
- Regulatory & Litigation Risks
- Medical devices require approval from bodies like the FDA. A failed trial or regulatory setback could hurt the stock.
- Product liability lawsuits or concerns about procedure outcomes could negatively impact the company’s reputation.
- Dependency on Procedure Volumes
- A large portion of Intuitive’s revenue comes from procedures performed with its installed base of robots.
- Economic downturns, hospital budget cuts, or lower elective surgeries (e.g., during pandemic peaks) can reduce procedure volume and revenue.
- Slowing Growth in Developed Markets
- In saturated markets (like the U.S.), future growth depends on deeper penetration of existing hospitals or expansion into new surgical categories.
- Growth challenges or delays in new procedure approvals can stall revenue momentum.
Key Takeaway
- ISRG has a strong position in a growing field (robotic-assisted surgery), with recurring revenue streams and high margins.
- Valuation is typically high, and increased competition plus regulatory uncertainties are the primary risks.
- It remains a leader in robotic surgery technology, but investors should watch whether future growth and earnings can justify the premium price.
Disclaimer: This information is for educational purposes only. It does not constitute financial or investment advice. Always consult a qualified financial professional before making any investment decisions.
BBAI – Worth a punt
Interesting $1bn company which is tiny and they have a proven product – They had a lot of debt, but t hat got converted to convertable notes on 24th Dec
BigBear.ai (ticker: BBAI) provides AI-driven analytics and cyber engineering solutions, with a primary focus on government and defense clients. While it also has commercial customers, the company’s most prominent contracts tend to be with U.S. federal agencies and military branches, including:
- U.S. Department of Defense (DoD)
- Work spans multiple branches (e.g., U.S. Army, U.S. Air Force) to provide data analytics, predictive modeling, and decision-support tools.
- U.S. Intelligence Community
- BigBear.ai has longstanding relationships with various intelligence agencies, delivering AI-driven intelligence, surveillance, and reconnaissance (ISR) solutions.
- Other Government Agencies
- Includes the Department of Homeland Security and other federal entities that require advanced analytics for threat assessment and operational planning.
- Commercial & Industrial
- Although BigBear.ai’s roots are in defense/intelligence, the company has begun expanding into sectors like healthcare, finance, and manufacturing. Specific commercial clients are often undisclosed, but BigBear.ai has indicated growing interest among Fortune 500 companies seeking predictive analytics and supply-chain optimization.
BigBear.ai’s product suite—covering data ingestion, analysis, and visualization—is generally geared toward high-stakes, complex environments. As such, government contracts remain a cornerstone of its revenue, with commercial lines providing additional growth opportunities.