Neal's Deals (Vol. 88) - Stargate: Data Centers, Economic Boost, and Billionaire Bickering ?????????

Hey everyone – This week three top tech leaders announced the formation of a new company, Stargate, aimed at advancing artificial intelligence infrastructure in the U.S.

OpenAI CEO Sam Altman, SoftBank CEO Masayoshi Son, and Oracle Chairman Larry Ellison appeared at the White House alongside President Donald Trump to unveil the initiative. The companies are kicking things off with a $100 billion investment into data centers, with plans to scale up to $500 billion in the coming years. The project is expected to create 100,000 U.S. jobs and underscores the growing collaboration between Silicon Valley and Washington. Stargate’s mission is clear: to ensure the United States leads in global AI infrastructure, keeping ahead of China in the high-stakes AI race, which has implications for everything from the economy to national security.

But the announcement wasn’t without its share of controversy. Elon Musk questioned the project’s financial feasibility and took aim at OpenAI CEO Sam Altman’s partnerships and political ties. Meanwhile, Salesforce CEO Marc Benioff speculated that Stargate might strain the relationship between OpenAI and Microsoft, following news that OpenAI would no longer rely exclusively on Microsoft’s Azure cloud platform.

These developments highlight just how pivotal AI infrastructure has become, not only as a technological battleground but as a platform for collaboration and contention among some of the industry’s most influential players. That is why in this edition of Neal’s Deals, we’ll dive into the details of the Stargate project, unpack its significance for Silicon Valley and Washington, and explore the drama surrounding this monumental initiative.

What are the details of the project?

SoftBank will shoulder the financial responsibilities for the project, while OpenAI will manage operations. The project’s investment will be focused on building state-of-the-art data centers to accelerate AI development.

Construction has already begun in Texas, with the first data center located in Abilene, according to Oracle Chairman Larry Ellison. The initial phase includes building 10 data centers, each approximately half a million square feet, with plans to expand to 20 locations nationwide. Other potential sites for data centers across the country are currently being evaluated.

Why has AI become such a point of focus?

The Stargate project underscores the critical role AI plays in driving innovation and addressing some of the world’s most pressing challenges. A source close to the venture revealed that the data centers will primarily support OpenAI’s efforts, paving the way for advancements in areas such as cancer research and defense technology.

President Trump described Stargate as a job creation engine and OpenAI echoed this sentiment, stating on its website that the initiative would generate “hundreds of thousands” of jobs over time. New hires will be concentrated near the data center locations, with roles spanning construction, operations, and engineering.

Beyond the immediate economic impact, Wall Street sees Stargate as a clear indication that the Trump administration is intensifying its commitment to advancing AI innovation—further underscored by Trump’s decision to rescind Biden’s executive order on AI safety.

Ok so what is all the drama about?

Now to the fun part….Elon Musk has emerged as a vocal critic of the Stargate project, questioning its financial feasibility and claiming that SoftBank and other backers do not have the funds to support their ambitious commitments. He also took aim at OpenAI CEO Sam Altman, criticizing his partnership decisions and past political affiliations. Altman, in response, dismissed Musk’s remarks with a sarcastic post on social media, further fueling tensions.

Meanwhile, the project has also highlighted a potential rift between Microsoft and OpenAI. The announcement that OpenAI will no longer rely exclusively on Microsoft’s Azure cloud platform prompted Salesforce CEO Marc Benioff to speculate that this shift could create friction as Microsoft focuses on building its own AI models and infrastructure.

Microsoft CEO Satya Nadella downplayed the concerns, reaffirming the company's “critical partnership” with OpenAI while underscoring Microsoft’s $80 billion investment in Azure. The Stargate drama perfectly captures the high-stakes rivalry in the tech world, where major players are vying for AI dominance—sometimes throwing shade at each other on social media.

(Queue Why Can’t We Be Friends)

Anyway, while these billionaires duke it out over funding and strategy, the broader geopolitical implications of this massive infrastructure commitment remain to be seen. Grab your popcorn—this showdown is just getting started…

Let’s get to it:

Mili, a startup based in Plano, TX, that has built an AI-powered meeting assistant designed for wealth advisors, raised a $2 million seed round co-led by Chiratae and BoldCap.

Why this is interesting: Mili positions itself as a transformative force in the wealth management industry with its enterprise-grade AI platform aimed at streamlining advisory workflows and ensuring compliance. The platform automates tasks like real-time note-taking, client onboarding, and financial strategy planning, which helps reduce administrative overhead for wealth managers. While Mili emphasizes features such as customizability, deep integrations, and SOC 2-certified security, it's worth noting— as we’ve discussed in Neal’s Deals previously—that the market is crowded with AI-driven notetakers offering similar functionalities. Yes, Mili adds compliance-focused enhancements, such as automatically masking sensitive information (e.g., account numbers and SSNs) and flagging critical compliance terms. These features are valuable, but the key question is whether they are sufficient to establish a defensible position. Mili’s success will likely hinge on its go-to-market strategy and sales execution to create a competitive moat in an increasingly saturated space.

Ember Software, a San Francisco startup whose vertical software platform helps empower fire protection professionals, raised a $10 million round led by 8VC and Menlo Ventures.

Why this is interesting: Fire protection companies, which are critical to public safety and economic stability, often lack modern technological solutions to enhance their operations. Ember Software addresses this gap by providing tools that streamline the day-to-day, reduce inefficiencies, and help fire protection professionals focus on their core mission of safety. The platform offers customizable forms compliant with federal and state standards, centralized data management, seamless submissions, intuitive scheduling, and smart proposals to support business growth. With over 17,000 fire inspectors in the U.S. alone, this market is large, underserved, and ripe for innovation. With a quick search of ‘Fire Inspection Software,” it is easy to tell that the industry could use a new player. It’s also worth noting that many of these businesses are privately owned, allowing them to bypass the bureaucratic sales cycles associated with public fire departments. Always a big fan of underserved industries getting some attention—excited to follow this one.

Spaceium, a San Francisco startup that is developing unmanned service stations in space to support interplanetary missions, raised a $6.3 million seed round led by Initialized Capital.

Why this is interesting: The co-founders of Spaceium identified a critical industry challenge: the lack of refueling options in space. Currently, spacecraft must carry all the fuel required for a mission, leading to significant limitations and turning spent spacecraft into space debris once their missions are complete. Spaceium aims to address this bottleneck by creating a network of in-space refueling stations, a "space superhighway" that would support longer missions and open new possibilities for deep-space exploration, including Mars colonization. While competitors like Orbit Fab and Astroscale are also tackling in-space refueling—Astroscale recently secured a $25.5 million U.S. Space Force contract—Spaceium believes its proprietary technology offers a unique advantage. Their system reportedly allows fuel to be stored for longer periods, a challenge yet to be solved by others in the field. Commercializing this solution will undoubtedly take time, but once implemented, it has the potential to profoundly impact an industry that is increasingly becoming a national priority.

Deals in the Works:?If you want to learn more - feel free to reach out

1. Platform for businesses to reach customers on the messaging apps they use most
2. Commodities risk management made easy
3. Banking built for families
4. White-labeled earned wage access platform for FIs
5. AI for healthcare claim denials

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Quote of the week:

I am always doing that which I cannot do, in order that I may learn how to do it.” - Pablo Picasso

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Have a great weekend everyone!