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Greetings! One of venture capital's big misses has to be AppLovin, an ad-tech firm specializing in selling ad space in gaming apps. Its shares have soared more than 900% since the beginning of last year, giving AppLovin a market capitalization today of $135 billion. That makes it just a bit smaller than Spotify, Shopify and Arm Holdings—and bigger than companies such as Comcast, Intel and DoorDash. And yet according to AppLovin CEO and co-founder, Adam Foroughi, when he tried to raise $1 million in a seed round on Sand Hill Road in early 2012, he struck out. It was hard at the time to persuade investors that an advertising company "that wasn't Facebook, Google or Amazon could become a material business," he recalled in this onstage interview with the folks at Jefferies a few days ago. What a blunder. My colleague Catherine Perloff's story on AppLovin today reveals how the company's success in the app ad marketplace prompted Google to take steps to ward off the smaller company's market inroads. AppLovin's success is a reminder of how companies that don't raise money the traditional way often travel beneath the radar, getting little attention from the news media or investors. With no funding, AppLovin had to get profitable real fast—which it did. By the end of 2012 it was in the black, Foroughi said, and the company was able to raise $4 million from angel investors. It didn't raise any other venture funding. That's not something you see very often from tech companies going public; they frequently report a history of losses and of financing their operations primarily from equity raising. AppLovin's cash generation has lately ballooned. The company generated free cash flow of $2.1 billion last year—or 44% of revenue—double the amount it generated in 2023. In the first quarter of this year, its free cash flow doubled again. (The Jefferies interview is worth watching, by the way—among other things, Foroughi revealed that he rebuffed various entreaties from investors and advisers to change the company's less-than-great name because it was a "handicap" the company was forced to overcome by building "the best product.") To be sure, there are plenty of AppLovin skeptics out there, including a bunch of short-sellers who wrote some damning reports on AppLovin's business earlier this year, slicing the stock in half between February and early March, although it has since recovered a bit. As our story points out, AppLovin succeeded in part by ignoring privacy conventions in ad tracking that Google adhered to—until recently. That implies Google could become a much more effective rival soon, although the bigger company has a lot of other issues to deal with. Still, our story also noted that AppLovin's efforts to expand into e-commerce ads have had mixed success. Where the stock goes from here is, therefore, hardly assured. Still, it's a reminder that Silicon Valley investors often miss the forest for the trees. That didn't take long. Just a few days after being lauded by President Donald Trump in the Oval Office, Elon Musk took to his X service on Tuesday to attack Trump's "big, beautiful" budget bill. On the very day Trump attacked Sen. Rand Paul for declaring his opposition to the bill, Musk tweeted that the "massive, outrageous, pork-filled congressional spending bill is a disgusting abomination." (Paul later tweeted that he agreed with Musk). Musk followed that with a tweet: "In November next year, we fire all politicians who betrayed the American people." While his tweets were aimed at Congress, Trump is the one pushing for the bill's quick passage. It's hard to imagine this will end well. Already Trump has changed tack on who should run NASA, withdrawing his nomination of Jared Isaacman, whom Musk had pushed as a candidate for the job. If Trump and Musk have a big falling out, will the ripple effects flow to others in tech who also supported Trump? • Meta Platforms is buying the power output from Constellation Energy's Clinton, Illinois, nuclear power plant under a 20-year deal announced on Tuesday, the latest sign of how tech firms are dealing with fast-rising needs for electricity to power their AI data centers. • Thoma Bravo raised $24.3 billion for its main buyout fund and a total of $34.4 billion across three funds, marking its biggest fundraising year ever. • The Kuwait Investment Authority is joining a Blackrock-led plan to invest up to $100 billion in data centers for artificial intelligence. More than 100,000 readers rely on The Information's Creator Economy newsletter for coverage of the creator startups making waves, big tech companies' social media playbooks, and scoops on the sector's biggest hires. Start receiving the free newsletter here. | 
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