The California AI bill is back, and it lost its teeth
Mar 7, 2025
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California's latest AI safety bill is facing major changes, stripping down controversial parts while still protecting whistleblowers. The discussion dives into this legislative shift and the challenges of AI regulation amid a pivot towards innovation. The hosts also dig into the buzz around SXSW, the surprising growth of fintech giant Ramp, and the intriguing implications of CoreWeave's IPO. Nostalgia for early internet platforms like Digg resurfaces as key players try to revitalize their legacy. Expectations are high for future funding trends in a shifting venture capital landscape.
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Quick takeaways
California's new AI bill SB 53 seeks to balance innovation and safety but faces skepticism regarding its effectiveness in real-world applications.
Ramp's rapid growth to $700 million in revenue highlights concerns about sustainability as half of its income is reinvested in R&D.
The revival of Digg by Kevin Rose and Alexis Ohanian emphasizes AI moderation to combat misinformation, reflecting a nostalgic yet ambitious vision for the platform's future.
Deep dives
Rebirth of Digg: Embracing AI Moderation
The revival of the early news aggregator Digg is being spearheaded by its original founder, Kevin Rose, alongside Reddit co-founder Alexis Ohanian. Their partnership aims to reestablish Digg as a competitive platform in the news space, focusing heavily on AI moderation as a means to combat misinformation. This approach echoes a nostalgic sentiment for the internet's earlier days and suggests the potential for Digg to play a significant role in today’s digital landscape. However, while Rose and Ohanian express optimism, the real impact of this new strategy on the platform's relevance remains to be seen.
Ramp's Growth: A Fintech Powerhouse
Ramp, a fintech startup known for its corporate credit card solutions, has seen remarkable growth, reporting over $700 million in annualized revenue as of January. Despite this impressive figure, there is caution regarding their profitability, as the company deliberately reinvests in research and development, allocating half of each dollar towards this effort. Analysts note that while Ramp's annualized figures are significant, they may not fully represent sustainable revenue trends, as they are based on best-performing months. Furthermore, the company's heavy reliance on AI as a driving force for efficiency raises questions about the specifics of this integration and its long-term viability.
CoreWeave's S1 Filing: High Stakes and Concerns
CoreWeave's recent S1 filing reveals its ambitious goal to raise between $3.5 to $4 billion, banking on its status as an AI-focused cloud service provider backed by Nvidia. Originally a cryptocurrency mining venture, CoreWeave has pivoted to leverage its GPU resources for AI development, but the company faces heavy debt, amounting to $7.9 billion, which raises red flags about its financial stability. The fact that over 60% of their revenue comes from Microsoft underscores the risks involved, especially amidst reports of potential contract pullbacks due to delivery issues. As CoreWeave prepares for its IPO, questions about its long-term commitment and diversification strategies continue to linger.
AI Regulation in California: A Balanced Approach
The new California AI bill, SB 53, aims to address concerns surrounding advanced AI systems while also providing tech companies a platform to report issues. Unlike its controversial predecessor SB 1047, the new legislation focuses on fostering innovation by establishing a public cloud computing cluster, thus encouraging AI development without stifling the industry. However, critics argue this approach lacks substance, with some components like whistleblower protections already existing in law, questioning its necessity. The bill appears to be an attempt at appeasing both the tech industry and regulatory demands, but its efficacy and real impact on AI safety remain uncertain.
Funding Disparities: Gender Gap in Startups
Recent statistics highlight a continuing funding disparity in the startup ecosystem, particularly between male-founded and female-founded companies. In Europe, VC funding for female founders dropped by 12%, mirroring a broader 11% decline in overall funding, indicating a stagnant situation rather than a worsening one. Notably, a significant portion of VC raised by female founders is directed towards deep tech startups, demonstrating an area of strength despite the overall decline. However, the US market shows similar trends; while there has been a stabilization in female funding after sharp drops, the struggle for parity continues amidst a competitive investment landscape, emphasizing the challenges female entrepreneurs still face.
California’s most controversial AI safety bill of 2024 might be dead, but its author isn't backing down. State Senator Scott Weiner is back with SB 53, a new AI bill that strips away the most debated parts of last year’s failed legislation while keeping key whistleblower protections and a public cloud computing initiative called CalCompute.
With the AI industry and even the federal government shifting away from AI safety regulation in favor of innovation, will the bill gain any traction? Today, on TechCrunch’s Equity podcast, hosts Kirsten Korosec, Max Zeff and Anthony Ha are unpacking the latest moves in AI regulation along with the week’s top stories in tech and startups.
Listen to the full episode to hear about:
What Kirsten is hoping to see on the ground at SXSW this year
CoreWeave’s IPO, and why the founders’ latest moves are raising eyebrows. As Kirsten put it: there's nothing more fun than diving into an S-1
Equity is TechCrunch’s flagship podcast, produced by Theresa Loconsolo, and posts every Wednesday and Friday.
Subscribe to us on Apple Podcasts, Overcast, Spotify and all the casts. You also can follow Equity on X and Threads, at @EquityPod. For the full episode transcript, for those who prefer reading over listening, check out our full archive of episodes here.
Credits: Equity is produced by Theresa Loconsolo with editing by Kell. We’d also like to thank TechCrunch’s audience development team. Thank you so much for listening, and we'll talk to you next time.
