Good morning. Andrew here. Mark Zuckerberg announced a new open-weight A.I. model that can run locally on a laptop, aiming to prove that open models can be far smaller and cheaper than top frontier systems — potentially rewriting the industry’s economics. Meta is also creating a $1 billion fund to support police and firefighters in towns hosting its data centers, an effort to counter local pushback in states like New York and Texas. We get into all of it. Plus, don’t miss our fascinating piece on Mayor Zohran Mamdani’s efforts to recruit business leaders to a panel of advisers. More below. (Was this newsletter forwarded to you? Sign up here.)
Zuckerberg’s bid to catch up on A.I.When it comes to artificial intelligence, the discussions in Silicon Valley and in Washington in recent weeks have come down to one thing: open versus closed. Meta is now doubling down on the open camp. Its C.E.O., Mark Zuckerberg, outlined that in his philosophy on A.I., as the company races to catch up with technologically advanced rivals in the West and in China. Zuckerberg’s mantra: Give everyone access to A.I. That’s the central thesis of a 14-page essay he published this morning, in which he talks up widespread access to A.I. and agents. (That means personalized coaches for every subject, tools to start businesses and more.) The other way of looking at it? Oppose centralizing control of A.I. That principle, which he outlined to The Times last month, is a direct shot at leading A.I. labs like Anthropic and OpenAI, whose favoring of closed A.I. models risks restricting access to the most powerful features of the technology. That includes committing to open models. Zuckerberg announced that Meta was releasing Muse Glimmer, an open-weight model close in abilities to its most powerful tool, Muse Spark. The move is meant to position Meta as a bulwark against rapidly advancing and increasingly popular Chinese open A.I. models, which can be much cheaper to run than high-end Western ones, but also while increasingly match their performance. (That said, Zuckerberg didn’t say whether Meta’s forthcoming cutting-edge model, internally code-named Watermelon, would be open or closed.)
Meta also talked up a commitment to safety, including by proposing that A.I. companies help the federal government toughen critical tech infrastructure. Perhaps more important, these companies should submit their tools to government reviews more frequently during development, instead of just at the end of training. And he proposed spending more on local communities, as Meta and other tech giants face blowback over their plans for giant data centers to power A.I. Zuckerberg promoted Meta’s program to pay for the training of skilled tradespeople to build the giant server farms, as well as an initiative in which teachers in the Louisiana community in which it’s building a huge data center received a $50,000 bonus. Meta still has some hurdles.
But Zuckerberg appears to be betting that committing to openness (and lower cost) and a willingness to work with Washington will help Meta catch up. Whether that’s enough remains to be seen.
Oil prices tick up amid uncertainty about the Strait of Hormuz. Brent crude, the international benchmark for oil, hovered close to $85 a barrel today as ship traffic through the waterway remained at a trickle. Tensions between Iran and the U.S. remain high, with President Trump saying he was only “semi-negotiating” over the strait while Tehran named Mohsen Rezaei, who supports Iran having control over the waterway, as the new secretary of the Supreme National Security Council. Taylor Farms voluntarily recalls some products with fresh jalapeños. The company is recalling products distributed in 26 states that have been tied to a salmonella outbreak. It’s the latest blow to Taylor Farms, which has already been linked to a large outbreak of cyclosporiasis tied to iceberg lettuce. Paramount reportedly commits to releasing 30 movies a year in theaters. The media giant has struck written agreements with AMC and Cineworld’s Regal Cinemas, the world’s biggest theater chains, guaranteeing the release figure if it acquires Warner Bros. Discovery, according to Bloomberg, citing unnamed sources. The move appears aimed at countering claims in a lawsuit by several states that Paramount would reduce its output if the deal goes through.
Mamdani’s new business outreachNews about a business advisory council that Mayor Zohran Mamdani of New York is forming had Wall Street abuzz over the weekend, Niko Gallogly and Lauren Hirsch report. Some dismissed the council as a superficial move from Mamdani, who has taken aim at business elite. Still, others cited it as an example of the behind-the-scenes effort to form a more cooperative relationship between the corporate sector and the administration. Mamdani and his team have been meeting with C.E.O.s from different sectors since December. It is weeks away from formally announcing the members of the council, which will engage business leaders for their input into the city’s economic development strategy, Dora Pekec, a spokeswoman for the Mamdani administration, told DealBook. Among the list of invitees, first reported by Bloomberg and confirmed by DealBook, are:
DealBook has also learned of two more people the mayor’s office has reached out to about the possibility of joining the council. According to a person familiar with the administration’s plan who was not authorized to speak publicly, they are:
Wolf told DealBook that he was considering joining the council and that he hoped business leaders would engage “in a constructive way, irrespective of where they are politically, as helping N.Y.C. thrive economically has to be a priority.” Weiss, Ryan and Ulukaya declined to comment and Tavarez did not respond to a request for comment. At least some C.E.O.s are skeptical of the council. Steven Fulop, the president and C.E.O. of the Partnership for New York City, which represents many corporate giants, told DealBook he had “spoken with a number of major business leaders who declined the invitation,” partly because of their frustration with Mamdani’s approach to the corporate sector. Fulop cited as one example a video Mamdani posted on social media that took aim at a $238 million penthouse owned by Ken Griffin, the C.E.O. of Citadel. “We’re tired of the performative gestures on one hand, and then being punched in the face publicly on the other,” Fulop said. “Mayor Mamdani has been clear from Day 1 that New York City will remain the business capital of the world,” Pekec said in a statement in response to Fulop’s concerns, “and that his door is open to business leaders who wish to share strategic guidance.”
Private equity is stuck in limboThis should be a golden moment for private equity. Stock indexes have been hitting record highs and global deal-making has surged this year. (Not to mention the fact that a number of private equity guys are dating celebrities.) And yet the industry continues to flounder, stuck with companies it can’t offload, Maureen Farrell reports for The Times. The number of companies sitting stagnant in private equity portfolios has increased for a third year in a row. As of June 30, private equity firms had 33,575 unsold companies in their portfolios, according to PitchBook. That’s double the amount from a decade ago. And while the first half of 2026 was the second-highest for I.P.O.s by volume in more than 10 years, the prospect of a flood of I.P.O.s for private equity-owned companies looks bleak: Since 2022, only 70 private equity-backed companies have gone public on U.S. exchanges, according to the data firm Dealogic. Frustration is building for big investors in private equity, like pension funds and endowments, Farrell writes: As the backlog grows, private equity firms continue to underperform the broader stock market. From July 1, 2022 to March 31, 2026, U.S. private equity firms generated annualized returns of 6.4 percent, according to the most recent data from MSCI, an index firm. That’s far below the 15.2 percent annualized returns of the S&P 500 and the 19.3 percent of the Nasdaq during the same time period. There are several reasons for the logjam. Higher interest rates have made it difficult for private equity firms to find buyers that rely on cheap debt to finance acquisitions. Another challenge is the weakness in the software sector, where there is a heavy concentration of private equity-owned companies. The value of many software firms has declined, as investors worry that artificial intelligence will cut into future earnings. A prolonged delay in sales and I.P.O.s could lead to more pain, Farrell reports, with firms eventually being forced to sell, even if it’s at a lower price.
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