📰 Key Takeaways

Situational Awareness, the fund that recently sold off most of its public market holdings, keeps doubling down on private investments. According to The Wall Street Journal, the fund poured another $400 million into Source Foundry this week, a startup founded by Stanford researchers focused on speeding up chip manufacturing and cutting its costs, bringing its total investment in Source Foundry to $500 million.

Situational Awareness was founded by former OpenAI researcher Leopold Aschenbrenner, who launched the fund in 2024 in his twenties with zero trading experience. Early returns were reportedly strong, but the fund has taken significant losses in recent months as AI infrastructure stocks slid. In late July, the fund sold most of its public market portfolio to Ken Griffin’s Citadel, while holding onto its Anthropic stake. Its assets under management reportedly shrank from $20 billion to $10 billion.

Despite these setbacks, Aschenbrenner hasn’t pushed back his wedding.

💬 JudyAI Lab Take

After selling most of its public holdings to Citadel, Situational Awareness founder Aschenbrenner still put another $400 million this week into chip manufacturing startup Source Foundry, bringing the total to $500 million.

What’s worth noting for AI builders here is the divergence in where the capital is flowing: the same investor is unloading public AI infrastructure stocks (while keeping the Anthropic stake) on one hand, and continuing to double down on private chip manufacturing startups on the other. Even under the pressure of falling AI infrastructure stock prices and AUM shrinking from $20 billion to $10 billion, “cutting the cost of chip manufacturing” — a foundational layer of the supply chain — is still being treated as worth a long-term bet, not something that moves with short-term public market swings. For AI builders, it’s a reminder that public market price action and the underlying long-term fundamentals judgment behind a technology or investment don’t always move in sync.

Next time you see a headline about AI infrastructure stocks tanking, it’s worth pausing to ask: is this just short-term sentiment, or has the long-term direction actually changed?

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