Scale or Die: Why 2025 really is the Inflection Point That Changes Everything

You've heard it before and you'll hear it again. AI is a gold rush. It will change everything. But 2025 is different, That Was The Week tech newsletter publisher Keith Teare argues. This is the year that the AI gold rush is changing everything. In our reflection of the first six months of 2025, Keith argues that we're witnessing a fundamental "phase shift" - not just another tech cycle, but an inflection point where scale becomes a necessity for survival. From Meta's $100 million developer deals to the consolidation of 80% of venture capital into just five firms, from Cloudflare's revolutionary "toll booth" economy replacing advertising models to the tokenization of private markets through platforms like Robinhood, the rules of Silicon Valley are being rewritten. As graduates face an employment crisis and AI superstars command unprecedented compensation, Keith and I debate whether this transformation represents capitalism's natural evolution or a dangerous concentration of power that could reshape the global economy forever.

1. Scale Has Become a Survival Requirement

2025 marks a shift where scale isn't just advantageous—it's necessary for survival. With 80% of venture capital flowing to just five firms (Andreessen, Sequoia, Cotu, Lightspeed, and one other), and late-stage investors writing billion-dollar checks for 3-5x returns instead of traditional smaller bets for 100x gains, the venture capital game has fundamentally changed.

2. The "Toll Booth" Economy is Replacing Advertising

Cloudflare's "paper crawl" initiative represents a seismic shift from advertising-based revenue models to direct payment systems where AI companies must pay publishers for content access. This could create new revenue streams for content creators while giving them control over how their intellectual property is used for AI training.

3. Tokenization is Democratizing Private Markets

Robinhood's tokenization of companies like SpaceX and OpenAI allows European retail investors to buy shares in private companies through crypto-backed tokens. This convergence of private markets, public markets, and crypto could fundamentally change who can access high-growth investments.

4. AI Superstars Command Unprecedented Value

While AI eliminates many jobs, it's creating extreme value concentration among top talent. Meta's $100 million deals for individual AI experts and OpenAI's $6 billion deal with Johnny Ive illustrate how differentiated developers are becoming incredibly valuable in an age where most workers face displacement.

5. 2025 is the Inflection Point, Not the Future

Unlike previous tech cycles, Keith argues this isn't about future potential—the transformation is happening now. With companies like OpenAI reaching $14 billion in annual revenue and AI's economic impact becoming undeniable, 2025 represents the moment when AI shifted from promise to reality, making it a true inflection point rather than just another tech trend.

Where Keith and I fundamentally disagree is over jobs. He seems to skate over the implications of jobless consequences of AI, believing in some sort of magical age of abundance in which we will all be free to pursue our hobbies. I think this is entirely wrong. This is where his Silicon Valley language about having to “scale or die” is so terrifying. Over the next couple of decades, tens of millions of people are going to lose both their jobs and careers to the AI revolution. Some might find other kinds of work, but most won’t. The age of abundance is total a myth. Instead of “scale or die”, the mantra of the coming age will be “scale or starve”. What we are about to experience is the kind of economic scarcity that will utterly transform our societies and politics. 2025 might be an inflection point for Silicon Valley. But that existential moment for the rest of us will come in around 2030.

Keen On America is a reader-supported publication. To receive new posts and support my work, consider becoming a free or paid subscriber.

This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit keenon.substack.com/subscribe