Musk Chases the Smart AI Money in $60 Billion Deal: Parmy Olson

One of the most fundamental ingredients of Silicon Valley success is the practice of dominating a market to rapidly achieve massive scale. The strategy has a name, blitzscaling, coined by billionaire venture capitalist Reid Hoffman, and it has created unfathomable wealth for companies in social media, ride-hailing and streaming. But not so much artificial intelligence.

Elon Musk’s decision to enter an expensive partnership with the company behind AI-assisted coding tool Cursor, in which his SpaceX will pay $10 billion for the startup’s work or buy it for $60 billion, shows how futile the blitzscaling strategy can be when selling services ...