Pope warns AI could destroy society. Wall Street warns IPO bubble. ClickUp cut 22% for AI agents.

Good morning Crowd!

The Pope just warned it could destroy society.

The AI IPO wave is here.

And analysts are terrified.

The intel:

Pope Leo XIV released an 83-page encyclical yesterday, warning that AI could deepen inequality, erode trust, and concentrate power. He presented it at the Vatican alongside Anthropic's cofounder, while Anthropic fights the U.S. military in court over access to Claude. Meanwhile, Bank of America dropped its own warning: If SpaceX and OpenAI go public at their reported valuations, the top U.S. stocks will control 48% of the market, higher than the dot-com bubble. Taiwan overtook Canada in market cap. South Korea passed the UK. And ClickUp proved what happens when AI agents meet real companies: 22% layoffs, $1M salary bands for survivors, 3,000 AI agents doing the work of hundreds.

In today's private markets rundown:

• Pope Leo XIV's AI encyclical: Inequality, power, trust

• Wall Street's IPO bubble warning

• Taiwan and South Korea surge past Western markets

• ClickUp's 22% layoff: The AI future is here

• SpaceX's S-1: Starlink makes billions, rockets lose money

• Quick hits on other deals

☕

Jose, Alberto, and the Founderscrowd team.

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⛪ POPE LEO XIV

First papal encyclical on AI: Inequality, eroded trust, concentrated power

What happened:

Pope Leo XIV released an 83-page encyclical on AI yesterday. Titled "Magnifica Humanitas" (Magnificent Humanity), it's the most authoritative religious statement on artificial intelligence ever issued.

He presented it at the Vatican alongside Anthropic cofounder Christopher Olah.

The details:

• Pope warns AI could deepen inequality, erode trust, and concentrate power without guardrails

• Anthropic is valued at $380B and in talks to raise at nearly $1T

• The company is separately suing the U.S. government over military access to Claude

• Pope Leo XIV (first U.S.-born pope) chose his name to honor Pope Leo XIII, who defended workers' rights during the 1890s industrial revolution

The three warnings:

Inequality: AI will make the rich richer and leave the poor behind. Companies with AI replace workers. Workers without AI skills lose jobs.

Eroded trust: Deepfakes. Misinformation. Loss of shared reality. You won't know what's real anymore.

Concentrated power: Big Tech monopolies control the models. Authoritarian governments use AI for surveillance. A few companies and governments control everything.

Why it matters:

Papal encyclicals are the highest form of Catholic teaching outside of dogma. This carries weight with 1.3 billion Catholics worldwide and influences global policy.

The timing is deliberate. This drops as SpaceX and OpenAI prep record IPOs, ClickUp lays off 22% for AI agents, and Wall Street warns of concentration risk.

The Pope is saying: "You're building systems that concentrate power. Here's why that's dangerous."

The Anthropic angle:

Christopher Olah presenting at the Vatican signals Anthropic is positioning itself as the "responsible AI" company.

Meanwhile, Anthropic is fighting the U.S. military in court. The company refuses to give the Pentagon unlimited access to Claude—arguing it would violate safety principles.

Olah stressed two things in his remarks:

• Independent oversight (not just Big Tech regulating itself)

• Public participation in AI governance (not just engineers deciding)

The military lawsuit:

Anthropic's argument: Giving the military unchecked access violates our safety charter. AI models trained for warfare could be misused.

Pentagon's argument: National security requires cutting-edge AI. China and Russia aren't holding back. Anthropic's restrictions weaken U.S. defense.

Bottom line:

The Pope sided with the skeptics. AI could deepen inequality, concentrate power, and erode trust. Without guardrails, it becomes a tool of oppression.

Anthropic is positioning itself as the ethical AI company—Vatican presentation, military lawsuit, oversight advocacy.

Whether that's genuine principle or savvy PR before a $1T fundraise? That's the question.

🚨 WALL STREET'S IPO BUBBLE WARNING

SpaceX + OpenAI could push market concentration past dot-com peak

What happened:

Bank of America strategist Michael Hartnett warned that if SpaceX and OpenAI go public at their reported valuations, the top U.S. stocks will control 48% of total market value.

That's higher than the dot-com bubble. Higher than anything except the 1880s railroad boom.

The details:

• SpaceX IPO: $1.75-2T valuation, $75B raise, June 12 listing (ticker: SPCX on Nasdaq)

• OpenAI IPO: $1T+ valuation, September 2026 listing (Goldman Sachs and Morgan Stanley advising)

• Combined new supply: $135B in equity (little modern precedent for this scale)

• Current market concentration: 40% (top stocks control this much)

• Post-IPO concentration: 48% (if both go public at reported valuations)

• Dot-com peak concentration: 44%

Historical comparison:

Only one period in history had higher concentration than 48%: the 1880s railroad boom.

Every other bubble—dot-com, Nifty Fifty, Japan's 1980s boom, Roaring Twenties—peaked lower.

Why analysts are nervous:

The concentration risk is extreme. If 48% of the market is controlled by top stocks, and AI cools, the entire market tanks. There's no diversification.

Inflation is creeping back. U.S. CPI hit 3.8% in April. Bank of America considers 4% a red flag for equities. The 30-year Treasury yield is pushing 5%.

This feels like 1999. Mega-cap IPOs at the peak of a bull run. Sky-high valuations. Concentrated bets on transformative technology.

But there's a difference:

The dot-com bubble had profitless companies going public on hype. Pets.com. Webvan. No revenue, no path to profit.

SpaceX lost $4.9B in 2025, but Starlink made $4.42B profit. OpenAI is generating $20B annualized revenue.

These companies have real products, real customers, real money.

Why this matters:

If SpaceX and OpenAI suck up all available capital, what happens to the rest of the market?

Nancy Tengler (Laffer Tengler Investments): "These IPOs could take almost all of the market's liquidity for a short period. Every fund, institution, and retail investor will want in."

Bottom line:

Wall Street is ringing the alarm. The skeptics say this is 1999 all over again.

But transformative technologies create generational fortunes. And AI is transformative.

History says the skeptics are usually right at market peaks. But history also says the people who bet on technology during revolutions get rich.

This is the gamble.

🌏 TAIWAN AND SOUTH KOREA SURGE

AI boom reshuffles global stock market rankings

What happened:

Taiwan overtook Canada to become the world's 6th-largest stock market. South Korea leapfrogged the UK into 8th place.

Both moves are driven by AI infrastructure demand. Chips = AI. Taiwan and South Korea make chips.

The details:

• Taiwan: $4.7T market cap (was #7, now #6)

• South Korea: 76% surge in 2025 (Kospi benchmark), now #8

• TSMC is driving Taiwan (world's leading advanced chip foundry)

• Samsung and SK Hynix driving South Korea (memory chips, AI processors)

• Semiconductor market cap: $9.4T in April 2026, up from $2.2T in May 2023 (4x in 3 years)

The chip winners:

TSMC (Taiwan): Makes 90%+ of the world's most advanced chips. Every AI model runs on TSMC chips.

Samsung (South Korea): Second-largest chip maker globally. Memory chips for data centers.

SK Hynix (South Korea): AI memory specialist. Revenue is exploding as AI models need more RAM.

Why this matters:

AI needs chips. Chips are made in Taiwan and South Korea. As long as AI demand grows, these countries capture the value.

This is a structural shift, not a bubble. The wealth is concentrating where the supply chain bottleneck sits.

But concentration risk is rising:

HSBC's Asia-Pacific head of equity strategy: "We're reaching levels where many Asian portfolios face concentration risk, too much exposure to a small number of stocks."

Taiwan is now like Saudi Arabia (dominated by Aramco) or Denmark (dominated by Novo Nordisk). One sector drives everything.

The geopolitical risk:

Taiwan controls 90%+ of advanced chip production. If China invades Taiwan, the global economy collapses.

Investors are betting this doesn't happen. If they're wrong, portfolios blow up.

The AI infrastructure boom is spreading:

• Broadcom: Accelerator revenue up 840% (March 2023 → March 2026), projecting $18.3B by year-end

• AMD: Accelerator revenue up 289% (same period)

• Meta, Anthropic, OpenAI: All ramping up partnerships with Broadcom

The AI boom isn't just Nvidia anymore.

Bottom line:

The global stock market is being redrawn by AI. Taiwan and South Korea are winning. Western markets (Canada, UK) are falling behind.

If you're investing in private markets, pay attention to where the chips are made. That's where the value is concentrating.

💎 WHAT FOUNDERSCROWD PREMIUM MEMBERS SAW

MARCH 2025: WE PROFILED CEREBRAS

What we told Premium members:

• Cerebras was trading on secondaries at $102-$107

• IPO expected in Q2 2026 at $150-160 range

• $510M revenue, $10B OpenAI contract

• Strong buy for investors who want AI infrastructure exposure

What happened:

• IPO'd at $185 (23% above high-end estimate)

• Popped to $311 on day one (68% gain)

• Currently trading at ~$280

If you'd bought at $105 in March 2025:

You're up 166% in 14 months. Annualized return: 142%.

If you'd bought at IPO ($185):

You're up 51% in 8 days.

🤖 CLICKUP'S AI TRANSFORMATION

22% layoff, $1M salaries, and 3,000 AI agents

What happened:

ClickUp laid off 22% of its workforce on May 21. CEO Zeb Evans framed it not as cost-cutting, but as an "AI-first transformation."

The company deployed 3,000 AI agents to do the work. Employees who survive and use AI effectively get million-dollar salaries.

The details:

• 22% of workforce cut (May 21, 2026)

• 3,000 AI agents deployed internally

• $1M salary bands for employees who generate "100x output" using AI

• $300M annual recurring revenue (2025)

• Company valued at $4B in 2021, now preparing for IPO

Evans's pitch:

"Most savings from this change will flow directly back into the people who stay. We'll be introducing million-dollar salary bands. If you create outsized impact using AI, you'll be paid outside of traditional bands."

Translation: Automate your job with AI, or lose it. If you survive, you could make $1M+.

How it works:

Workers don't do the tasks anymore. They direct AI agents. Then they review the agents' outputs.

The agents handle work that used to require humans. ClickUp says it's measuring the efficiency gains and will bake them into customer products.

Why this matters:

This is the first major tech company to explicitly tie layoffs to AI agents. It's a blueprint for the future of work.

The workforce is bifurcating. Two classes of workers emerging:

• AI-native operators: Build, manage, optimize AI systems. Make $1M+.

• Everyone else: Replaced by AI agents.

ClickUp is saying the quiet part loud. Most companies will follow.

But productivity gains are unproven:

Despite ClickUp's claims, broader data suggests AI-driven job cuts aren't delivering consistent financial benefits yet.

Companies are betting on future gains, not proven results.

The risk:

Cutting 22% of staff could destroy institutional knowledge, collapse morale, and leave the company unable to execute.

Evans is betting ClickUp can do more with fewer people. If he's right, it's a $1B+ exit. If he's wrong, the company collapses.

The comparisons:

Polsia: One-person startup using AI to handle all operations. Founder Ben Broca runs it solo.

Other tech layoffs: Most companies claim "efficiency," but ClickUp is explicitly calling eliminated roles "structurally obsolete."

Bottom line:

ClickUp just showed you the future. AI agents replace jobs. Survivors get paid $1M+ to manage the agents. Everyone else is out.

If you're investing in startups, ask: How many employees do they actually need? If AI can do the work, why pay for humans?

📊 THIS WEEK'S FUNDING & M&A

The deals that shaped private markets (May 18-24, 2026)

Big raises this week:

Fintech:

• Mercury: $200M Series D at $5.2B (TCV) — Banking for AI-first startups, 1 in 3 U.S. startups

AI/Infrastructure:

• Anthropic: Hired Andrej Karpathy (OpenAI co-founder) — Major talent acquisition

• No new funding disclosed this week for Anthropic, but secondary market prices rising

Notable hires (talent as capital):

• Anthropic: Andrej Karpathy (OpenAI co-founder, Tesla AI lead)

• Anthropic: Ross Nordeen (xAI founding member)

• Anthropic: Chris Rohlf (cybersecurity veteran)

New markets/infrastructure:

• Polymarket: Launched private company prediction markets (Nasdaq partnership)

Total raised this week: ~$200M disclosed (Mercury only major round this week)

M&A highlights:

None disclosed this week.

Notable secondary market activity:

• SpaceX: IPO filing confirmed, June 12 listing at $1.75T

• Oura: Filed confidentially for IPO at $11B

• Polymarket: Now offering contracts on OpenAI, Anthropic, SpaceX, and Stripe valuations

Portfolio moves:

• Leopold Aschenbrenner's Situational Awareness LP: $7.5B in bearish bets against Nvidia, AMD, chip stocks; Long on Bitcoin miners and AI power infrastructure

🔥 QUICK HITS

📰 Everything else in private markets this week

Anthropic: Hired Andrej Karpathy (OpenAI co-founder, Tesla AI lead) to work on pre-training and recursive self-improvement, major talent coup

Mercury: Raised $200M Series D at $5.2B (TCV). Banking 1 in 3 U.S. startups, 4 consecutive years profitable, riding the AI founder boom

Polymarket: Launched private company prediction markets (Nasdaq partnership). Retail can now bet on OpenAI, Anthropic, SpaceX valuations, and IPO timing

Leopold Aschenbrenner: Disclosed $7.5B in bearish bets against Nvidia/chip stocks, long on Bitcoin miners and power infrastructure — Contrarian bet that AI trade shifts from chips to power

Oura: Filed confidentially for IPO at $11B, Smart ring maker 4x'd revenue in 2 years, 80% subscription renewal rate, 5M paid members

NVIDIA: Still trading at 65% odds (Polymarket) to finish 2026 as the world's largest company by market cap. AI trade still hot despite concentration warnings

See you Thursday for the deep dive.

Until then, keep hunting. ☕

Jose, Alberto, and the Founderscrowd team.

P.S. Premium members: We're publishing the complete SpaceX S-1 teardown on Thursday. Every segment breakdown, every risk, every bull/bear case, and whether you should buy at $1.75T. Plus: Our model for which startups will follow ClickUp's AI agent playbook—and which will fail.

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