"The MBA crowd has switched all too seamlessly from talking about CAC (customer acquisition cost) and CPC (cost per click) to a rather different measure of efficiency: CPK, or cost per kill." Defense and AI are the biggest bubbles in European VC right now, especially as the climate VC bubble seems to have thankfully deflated a bit...though climate VCs are still the cringiest. https://lnkd.in/e3KAfUBG
The shift from CAC to CPK shows how quickly narratives adapt to follow capital, not values. Defense and AI are hot now, but Europe risks overcorrecting. Strategic depth won’t come from hype driven militarization ,it’ll come from building dual use infrastructure, resilient supply chains, and sovereign tech ecosystems that last beyond the next funding cycle.
I'm not so sure that there's a bubble to defense per se. Eventually we will run into hard material limits. As far as so-called AI. The architectures that are currently available to the public are not developing intellectual systems, intelligence systems, reasoning systems, or systems that are with agency of any kind. The fact of that there has not been lawsuits suing these companies into the absolute ground as to using the language incorrectly to falsely advertise their products, is it self insane. If you call it a large language model company whatever. If you call it a company utilizing the mathematics with autoregressive function approximation whatever, and so on. However, using specific labels that are incorrect to hype up a product that does not do the thing is illegal. If you tell me that a Ford F-150 comes with the capacity to X, yet it is not capable of X, then you should lose your shirt.
Cost Per Kill may not be the best indicator; total cost per won battle may be more meaningful.
Sun Tzu would likely say: "It is wise to invest in defense, but wiser still to ensure that such investment prevents war, rather than fuels it." Cost per kill is a fine enough measure as one builds toward the end of creating powerful deterrent. Investors who project returns based on ending an existing war (MITS Capital ) or adding preventative measures present a potential benefit to society, however, those whose projections depend upon new wars occurring will naturally have a conflict of interest with peace.
Yep, who is able to develop the cheapest AI-driven killer drones. That is the name of the game in the Defense sector. It must be a big disappointment for the traditional Defense sector though, since suddenly there is less need for expensive tanks, fighter planes, navy equipment etcetera. With a relatively low budget, countries can now build the most advanced defense organizations.
What are your actual beliefs about climate change? You are always so dismissive of every private and public attempt at solutions. This leads me to believe you either know some deeply scientific solution that you are keeping close to your chest or you deny it's a problem needing a solution.
For two months CPK morphs into CPSB as the European military bases close for summer. CPSB = Cost per Sub Bed.
Especially impressive bunch are European VCs who are passionate about investing in defense to protect Europe's sovereignty and speak about it with authority, but have never served in the army. 😳 Climate VCs are not the cringiest - they are beaten for the top spot by VCs investing in climate & defense, who are now investing in "resilience". 🙄
Thanks for sharing Michael. But how could climate VCs be more cringy than the defense efficiency KPI "CPK" (cost per kill). At least to me personally, this sends shivers down my spine!